The company is also a defendant in a sprawling multidistrict litigation targeting drugstores and insurers, including Walmart Inc., Walgreen Co., and CVS Pharmacy. Last summer, Rite Aid negotiated a temporary truce with three county governments involved in the litigation.
Financial Struggles and Turnaround Efforts
Amid tepid front-end sales at retail pharmacies and lower reimbursement rates, Rite Aid reported a 6% drop in revenues to $5.65 billion in the first quarter ended June 3 compared to the previous year, with a staggering net loss of $306 million. The company’s profits were further impacted by the loss of commercial clients at Elixir Insurance, a Medicare contractor.
“We’ve been a highly leveraged company for many years, which has limited our ability to invest in the business and keep up with our competitors,” explained Burr during an April earnings call. She detailed a program initiated in late 2022 to revamp the chain by boosting prescription and retail sales, reorganizing leadership, and reducing in-store inventory.
