Rite Aid is downsizing once again. The pharmacy chain and convenience store filed for Chapter 11 bankruptcy last year, and the company continues to struggle. Now, 27 more stores throughout Ohio and Michigan are set to close. This comes after 55 stores were closed in January, and another seven in April. USA Today reports that Rite Aid closed 154 underperforming stores when it filed for Chapter 11 bankruptcy last Fall. More than 500 stores have been closed nationwide, with the company citing a need to "further reduce rent expense and strengthen overall financial performance."
Amid billions of dollars and debt and legal issues surrounding the pharmacy providing illegal painkiller prescriptions, Rite Aid filed for bankruptcy amid decreasing sales. Despite previously being one of the leading pharmacy chains in the country, Rite Aid has struggled to keep up with its competitors, such as CVS and Walgreens, as it faced ongoing legal ramifications related to accusations that it helped fuel the opioid epidemic.
Under a Chapter 11 filing, Rite Aid was able to remain in business amid restructuring its debts. Before the filing, the company issued a statement noting they'd raised $3.45 billion in financing from lenders.
Rite Aid was founded in Philadelphia in 1962. It eventually became one of the largest pharmacy chains in the nation with more than 2,000 stores in 17 states. The company promised that most customers would not have to worry about the bankruptcy filing disrupting their prescription refills at local stores, but many of those stores have since closed, or are in jeopardy of closing.
Saving costs was a big reason for the bankruptcy filing. "Rite Aid regularly evaluates its store portfolio to ensure it is operating efficiently while meeting the needs of its customers, communities and associates," the company said in a statement at the time of the filing. "These efforts will further reduce the company's rent expense and are expected to strengthen its overall financial performance."
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