Rite Aid files for bankruptcy, plans to close some stores
Rite Aid has already seen its share of stores close in recent years, with more locations expected to close in the coming months.LEARN MORE
Drugstores did well during the pandemic due to COVID-19 vaccinations, but are now seeing less foot traffic and fewer prescriptions.
Three prominent national drugstore chains are grappling with escalating pressures, prompting them to shut down hundreds of stores across the U.S.
Earlier this week, the pharmacy chain Rite Aid announced it had filed for Chapter 11 bankruptcy and disclosed plans to shut down over 150 of its more than 2,000 stores in 19 states.
In the bankruptcy court documents, the pharmacy chain listed all the locations slated for closure but refrained from specifying the closure dates for each store.
The court filing detailing the store closures spanned across several states, with the most significant numbers being 38 in Pennsylvania, 31 in California, 20 in New York, 19 in Michigan, 12 in New Jersey, 11 in Washington, and 6 in both Ohio and Maryland.
The company said it had secured $3.45 billion in new financing to support the remaining stores and employee salaries during the restructuring. Currently, Rite Aid has a workforce of over 50,000 people, which includes over 6,000 pharmacists.
But Rite Aid’s bankruptcy and restructuring underscore enduring challenges in the retail pharmacy sector.
Last week, Walgreens pharmacy employees from 500 locations across the U.S. walked off the job to protest pharmacy conditions.
The chain, with nearly 9,000 U.S. stores, announced in 2019 that it would close 200 stores, and in June 2023, it stated that it plans to close an additional 150 locations by August 2024. The company has also cut 10% of office jobs and plans to save money through tech and new pharmacy plans.
And CVS is not far behind.
CVS has shut down about 300 stores since 2018, and in 2021, it announced that it would close 900 stores by 2024.
Drugstores did well during the pandemic due to COVID-19 vaccinations, but are now seeing less foot traffic and fewer prescriptions due to fewer elective procedures. Experts link pharmacy closures to various factors such as demographic shifts, fierce competition from online pharmacies, thin profit margins on drugs, and an increased focus on digital services.
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