- Rite Aid has filed for bankruptcy and will sell its pharmacy benefit manager and close some stores.
- The retail pharmacy industry in the U.S. is facing significant challenges.
- Walgreens and CVS Health are also struggling, with Walgreens reporting below-expectation earnings and pharmacists at both chains protesting understaffing.
- Factors contributing to the industry’s troubles include low profitability, fallout from the opioid litigation, and questionable acquisitions.
- Analysts predict a 58% drop in core retail earnings for Walgreens from 2019 to 2024.
- Rite Aid’s bankruptcy filing was expected due to lawsuits over its role in dispensing prescription opioids and its long-term debt.
- The company has a history of negative earnings and high debt from acquisitions.
- Rite Aid plans to turn its retail business around by closing stores and aiming for a 3.1% Ebitda margin by 2025.
- The future of Rite Aid and the retail pharmacy industry as a whole is uncertain.
- Walgreens and CVS are exploring primary care as a source of earnings growth.
Rite Aid’s bankruptcy filing and the challenges faced by Walgreens and CVS Health highlight the struggles of the U.S. retail pharmacy industry. Factors such as low profitability, fallout from the opioid litigation, and questionable acquisitions have contributed to the industry’s troubles. Analysts predict a significant drop in core retail earnings for Walgreens. Rite Aid’s bankruptcy filing was expected due to lawsuits and high debt. The company plans to turn its retail business around by closing stores and aiming for improved financial performance. However, the future of Rite Aid and the retail pharmacy industry remains uncertain. Walgreens and CVS are also exploring primary care as a potential source of earnings growth.
