Rite Aid Corporation is an American
drugstore
A pharmacy (also called "drugstore" in American English or "community pharmacy" or "chemist" in Commonwealth English, or rarely, apothecary) is a retail shop which provides pharmaceutical drugs, among other products. At the pharmacy, a pharmacis ...
chain based in
Philadelphia, Pennsylvania
Philadelphia, often called Philly, is the largest city in the Commonwealth of Pennsylvania, the sixth-largest city in the U.S., the second-largest city in both the Northeast megalopolis and Mid-Atlantic regions after New York City. Sinc ...
. It was founded in 1962 in
Scranton, Pennsylvania
Scranton is a city in the Commonwealth (U.S. state), Commonwealth of Pennsylvania, United States, and the county seat of Lackawanna County, Pennsylvania, Lackawanna County. With a population of 76,328 as of the 2020 United States census, 2020 U ...
, by
Alex Grass
Alexander Grass (August 3, 1927 – August 27, 2009) was an American businessman and lawyer who founded Rite Aid, one of the United States' largest drugstore chains.
Early life
Grass was born in Scranton, Pennsylvania, to Jewish parents, Louis ...
under the name Thrift D Discount Center. The company ranked No. 148 in the
Fortune 500
The ''Fortune'' 500 is an annual list compiled and published by ''Fortune'' magazine that ranks 500 of the largest United States corporations by total revenue for their respective fiscal years. The list includes publicly held companies, along ...
list of the largest United States corporations by total revenue.
Rite Aid began in 1962, opening its first store in
Scranton, Pennsylvania
Scranton is a city in the Commonwealth (U.S. state), Commonwealth of Pennsylvania, United States, and the county seat of Lackawanna County, Pennsylvania, Lackawanna County. With a population of 76,328 as of the 2020 United States census, 2020 U ...
; it was called Thrift D Discount Center. After several years of growth, Rite Aid adopted its current name and debuted as a
public company
A public company is a company whose ownership is organized via shares of stock which are intended to be freely traded on a stock exchange or in over-the-counter markets. A public (publicly traded) company can be listed on a stock exchange (l ...
in 1968. Rite Aid is publicly traded on the New York Stock Exchange under the symbol RAD.
In late 2015, Walgreens announced that it would acquire Rite Aid for $17.2 billion pending approval. However, on June 29, 2017, over fear of antitrust regulations,
Walgreens Boots Alliance
Walgreens Boots Alliance, Inc. is an American-British-Swiss holding company headquartered in Deerfield, Illinois that owns the retail pharmacy chains Walgreens and Boots, as well as several pharmaceutical manufacturing and distribution companies ...
announced it would buy roughly half of Rite Aid's stores for $5.18 billion. On September 19, 2017, the
Federal Trade Commission
The Federal Trade Commission (FTC) is an independent agency of the United States government whose principal mission is the enforcement of civil (non-criminal) antitrust law and the promotion of consumer protection. The FTC shares jurisdiction ov ...
(FTC) approved a fourth deal agreement for
Walgreens
Walgreen Company, d/b/a Walgreens, is an American company that operates the second-largest pharmacy store chain in the United States behind CVS Health. It specializes in filling prescriptions, health and wellness products, health information, an ...
to purchase 1,932 stores from Rite Aid for $4.38 billion total.
History
Alex Grass
Alexander Grass (August 3, 1927 – August 27, 2009) was an American businessman and lawyer who founded Rite Aid, one of the United States' largest drugstore chains.
Early life
Grass was born in Scranton, Pennsylvania, to Jewish parents, Louis ...
founded the Rite Aid chain in
Scranton
Scranton is a city in the Commonwealth (U.S. state), Commonwealth of Pennsylvania, United States, and the county seat of Lackawanna County, Pennsylvania, Lackawanna County. With a population of 76,328 as of the 2020 United States census, 2020 U ...
,
Pennsylvania
Pennsylvania (; ( Pennsylvania Dutch: )), officially the Commonwealth of Pennsylvania, is a state spanning the Mid-Atlantic, Northeastern, Appalachian, and Great Lakes regions of the United States. It borders Delaware to its southeast, ...
, in September 1962, after marrying into Harrisburg Pennsylvania's Lehrman family in the early 1950s. The first store was called Thrift D Discount Center. The store expanded into five additional states in 1965 and went public as Rite Aid in 1968. It moved to the
New York Stock Exchange
The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed c ...
in 1970.
Rite Aid is one of
Fortune 500
The ''Fortune'' 500 is an annual list compiled and published by ''Fortune'' magazine that ranks 500 of the largest United States corporations by total revenue for their respective fiscal years. The list includes publicly held companies, along ...
's Largest U.S. Corporations.
Growth and acquisitions
![Rite Aid, Scott Depot, WV](https://upload.wikimedia.org/wikipedia/commons/1/19/Rite_Aid%2C_Scott_Depot%2C_WV.jpg)
Ten years after its first store opened, Rite Aid operated 267 locations in 10 states. In 1981, Rite Aid became the third-largest retail drugstore chain in the country. 1983 marked a sales milestone of $1 billion. A 420-store acquisition along the east coast expanded Rite Aid's holdings beyond 2,000 locations.
A large number of acquisitions brought the chain to the state of
Michigan
Michigan () is a state in the Great Lakes region of the upper Midwestern United States. With a population of nearly 10.12 million and an area of nearly , Michigan is the 10th-largest state by population, the 11th-largest by area, and the ...
in 1984. These were of
Grand Rapids, Michigan
Grand Rapids is a city and county seat of Kent County, Michigan, Kent County in the U.S. state of Michigan. At the 2020 United States census, 2020 census, the city had a population of 198,917 which ranks it as the List of municipalities in Mi ...
-based Muir Drug and Remes Drug, along with Lippert Pharmacy of
Lowell and Herrlich Drug of
Flint
Flint, occasionally flintstone, is a sedimentary cryptocrystalline form of the mineral quartz, categorized as the variety of chert that occurs in chalk or marly limestone. Flint was widely used historically to make stone tools and start fir ...
; one year later, Rite Aid opened stores in
Lansing, Michigan
Lansing () is the capital of the U.S. state of Michigan. It is mostly in Ingham County, although portions of the city extend west into Eaton County and north into Clinton County. The 2020 census placed the city's population at 112,644, making ...
through the acquisition of State Vitamin. Expansion into
Ohio
Ohio () is a state in the Midwestern region of the United States. Of the fifty U.S. states, it is the 34th-largest by area, and with a population of nearly 11.8 million, is the seventh-most populous and tenth-most densely populated. The sta ...
began in 1987 through the acquisition of
Cleveland
Cleveland ( ), officially the City of Cleveland, is a city in the U.S. state of Ohio and the county seat of Cuyahoga County. Located in the northeastern part of the state, it is situated along the southern shore of Lake Erie, across the U.S. ...
-based
Gray Drug
Gray Drug was an American drugstore chain in Cleveland, Ohio. The chain began in 1912 and grew to 46 stores by 1946 and over 100 by the 1970s. Besides Ohio, stores later opened in Florida and Maryland. The chain later acquired Alexandria, Virginia ...
. Among the companies acquired was
Baltimore, Maryland
Baltimore ( , locally: or ) is the List of municipalities in Maryland, most populous city in the U.S. state of Maryland, fourth most populous city in the Mid-Atlantic (United States), Mid-Atlantic, and List of United States cities by popula ...
's
Read's Drug Store
Read's Drug Store was a chain of stores based in Baltimore, Maryland. Read's Drug Store was founded by William Read. He sold it to the Nattans family in 1899. The downtown store was constructed in 1934 by Smith & May, Baltimore architects also re ...
. On April 10, 1989,
Peoples Drug
Peoples Drug was a chain of drugstores based in Alexandria, Virginia. Founded in 1905, Peoples was subsequently purchased by Lane Drug in 1975, Imasco in 1984, and finally by CVS in 1990, which continued to run the stores under the Peoples banne ...
's 114 unit
Lane Drug
The Lane Drug Company of Ohio (also referred to as "Lane’s Discount Drugs", or "Lane's), was a discount drugstore chain in the United States that was originally based in Toledo, Ohio. On 10 April 1989, the chain was acquired by Rite Aid Corporat ...
of Ohio was purchased by Rite Aid.
Rite Aid acquired twenty-four
Hook's Drug Stores
Hook's Drug Stores was an Indianapolis, Indiana-based drug store chain which was founded in 1900 by John A. Hook. The chain flourished throughout central Indiana for most of the 20th-century.
Hook's did business under its own banner, the SupeRX D ...
stores in 1994, selling nine of those stores to
Perry Drug Stores
Perry Drug Stores was an American retail pharmacy chain founded in 1957 in the city of Pontiac, Michigan, United States. At its peak in the 1980s, Perry operated more than 200 drug stores, primarily in the state of Michigan, as well as 200 Auto W ...
, a Michigan-based pharmacy chain. One year later, Rite Aid acquired 224 stores from Perry, thus expanding its presence in Michigan even further.
In 1996, Rite Aid acquired
Thrifty PayLess
Thrifty PayLess Holdings, Inc. was a pharmacy holding company that owned the Thrifty Drugs and PayLess Drug Stores chains in the western United States. The combined company was formed in April 1994 when Los Angeles-based TCH Corporation, the pa ...
, a 1,000-store
West Coast West Coast or west coast may refer to:
Geography Australia
* Western Australia
*Regions of South Australia#Weather forecasting, West Coast of South Australia
* West Coast, Tasmania
**West Coast Range, mountain range in the region
Canada
* Britis ...
chain. The acquisition of Thrifty PayLess included the
Northwest
The points of the compass are a set of horizontal, radially arrayed compass directions (or azimuths) used in navigation and cartography. A compass rose is primarily composed of four cardinal directions—north, east, south, and west—each sep ...
-based
Bi-Mart
Bi-Mart is an employee-owned corporation, employee-owned chain of retailers located in the U.S. U.S. state, states of Oregon, Washington (state), Washington, and Idaho. A typical Bi-Mart houses merchandise including electronics and small appliance ...
membership discount stores, which was sold off in 1998. Acquisitions of Harco, Inc. and
K&B, Inc. brought Rite Aid into the
Gulf Coast
The Gulf Coast of the United States, also known as the Gulf South, is the coastline along the Southern United States where they meet the Gulf of Mexico. The coastal states that have a shoreline on the Gulf of Mexico are Texas, Louisiana, Mississ ...
area.
In the 1990s, Rite Aid partnered with
Carl Paladino's
Ellicott Development Co.
Ellicott Development Co. is an American property management, leasing and development real estate firm based in Buffalo, New York and led by CEO William Paladino. The company's asset base includes residential, commercial, hotels, parking garages, a ...
to expand the company's presence in
upstate New York
Upstate New York is a geographic region consisting of the area of New York State that lies north and northwest of the New York City metropolitan area. Although the precise boundary is debated, Upstate New York excludes New York City and Long Is ...
.
[Breidenbach, Michelle (October 10, 2010)]
How Carl Paladino built his Rite-Aid empire
''The Post-Standard'' (Syracuse, New York). Retrieved 2010-10-10.
On August 23, 2006, the ''Wall Street Journal'' announced that Rite Aid would acquire 1,858 Eckerd Pharmacy and Brooks Pharmacy stores from Jean Coutu for US$3.4 billion. The deal closed on June 4, 2007. Rite Aid announced that the two chains would be converted to the Rite Aid name, retiring the 109-year-old Eckerd banner. The merger was signed and completed as of June 4, 2007, with all remaining Eckerd stores converted to Rite Aid by the end of September 2007.
In 2015, Rite Aid purchased EnvisionRx, a
pharmacy benefit manager
In the United States, a pharmacy benefit manager (PBM) is a third-party administrator of prescription drug programs for commercial health plans, self-insured employer plans, Medicare Part D plans, the Federal Employees Health Benefits Program, ...
, which owns subsidiary PBMs MedTrak, Connect Health Solutions, and Smith Premier Services.
Partnerships
General Nutrition Corporation (
GNC) and Rite Aid formed a
partnership
A partnership is an arrangement where parties, known as business partners, agree to cooperate to advance their mutual interests. The partners in a partnership may be individuals, businesses, interest-based organizations, schools, governments o ...
in January 1999, bringing GNC mini-stores within the Rite Aid pharmacies. A partnership with drugstore.com in June 1999 allowed customers of Rite Aid to place
medical prescription
A prescription, often abbreviated or Rx, is a formal communication from a physician or other registered health-care professional to a pharmacist, authorizing them to dispense a specific prescription drug for a specific patient. Historica ...
orders online for same-day, in-store pickup.
In March 2018, Walgreens and Rite Aid agreed to a $4.3 billion deal for Walgreens to purchase 1,932 Rite Aid locations and 3 distribution centers.
Amazon
Amazon most often refers to:
* Amazons, a tribe of female warriors in Greek mythology
* Amazon rainforest, a rainforest covering most of the Amazon basin
* Amazon River, in South America
* Amazon (company), an American multinational technology c ...
announced in June 2019, that Amazon shoppers will be able to pick up their purchases at designated counters inside more than 100 Rite Aid stores across the US. The new service is called Counter and launches in the US after finding success in the UK with the Next clothing chain and in Italy with Giunti Al Punto Librerie, Fermopoint and SisalPay stores.
In May of 2022, Rite Aid partnered with Homeward, a rural home care startup. Under this partnership,
Medicare-eligible customers will be directed to Homeward's clinical services and will have access to Homeward mobile care units.
Company troubles
In the late 1990s, Rite Aid performed poorly, and its stock dropped precipitously from $30 to $4.40 At this time,
Mary Sammons
Mary F. Sammons (born 1946) is an American businesswoman who formerly served as the CEO, and is the former chairperson, of Rite Aid. She was formerly the president and CEO of Fred Meyer.
Biography
Mary F. Sammons was born in 1946 and hails from ...
, of
Fred Meyer
Fred Meyer is an American chain of hypermarket superstores founded in 1922 in Portland, Oregon, USA, by Fred G. Meyer. The stores are found in the northwest U.S., within the states of Oregon, Washington, Idaho, and Alaska. The company merged w ...
, was tapped by
Leonard Green, of
Leonard Green & Partners
Leonard Green & Partners ("LGP") is an American private equity investment firm founded in 1989 and based in Los Angeles. The firm specializes in private equity investments. LGP has invested in over 95 companies since its inception, including Petc ...
to become President/COO. She went on to become CEO in 2003.
In July 2001, Rite Aid agreed to improve their pharmacy complaint process by implementing a new program to respond to consumer complaints.
On July 25, 2004, Rite Aid agreed to pay $7 million to settle allegations that the company had submitted false prescription claims to United States government health insurance programs.
In August 2007, Rite Aid acquired approximately 1,850 Brooks and Eckerd Stores throughout the United States in hopes of improving their accessibility to a wider range of consumers. On December 21, 2007, ''
The New York Times
''The New York Times'' (''the Times'', ''NYT'', or the Gray Lady) is a daily newspaper based in New York City with a worldwide readership reported in 2020 to comprise a declining 840,000 paid print subscribers, and a growing 6 million paid ...
'' reported that Rite Aid had record-breaking losses that year, despite the acquisition of the Brooks and Eckerd chains.
The following fiscal quarter saw an increase in revenue but a sharp fall in net income as Rite Aid began the integration process. Rite Aid shares fell over 75% between September 2007 and September 2008, closing at a low of $0.98 on September 11, 2008. Rite Aid shares subsequently dropped to $0.20 on March 6, 2009, the all-time low .
[
]
Rite Aid had a major accounting scandal that led to the departure (and subsequent jail time) of several top ranking executives, including CEO Martin Grass. After serving six years in prison, Martin Grass was released on January 18, 2010. Founder Alex Grass died of
cancer
Cancer is a group of diseases involving abnormal cell growth with the potential to invade or spread to other parts of the body. These contrast with benign tumors, which do not spread. Possible signs and symptoms include a lump, abnormal b ...
on August 27, 2009.
In June 2010, John Standley was promoted from Chief Operating Officer to chief executive officer, with former CEO Mary Sammons retaining her position as chairperson; Ken Martindale, previously co-president of
Pathmark
Pathmark is a supermarket brand owned by Allegiance Retail Services, a retailers’ cooperative based in Iselin, New Jersey, USA. Pathmark currently has one location in East Flatbush, Brooklyn, New York, which it has operated since 2019.
From 1 ...
, was named Chief Operating Officer.
In October 2018, a former Rite Aid vice president of advertising and two co-owners of Nuvision Graphics Inc. pleaded guilty to in a $5.7 million kick-back scheme defrauding Rite Aid.
Surveillance practices
In July 2020, the
Reuters news agency
Reuters ( ) is a news agency owned by Thomson Reuters Corporation. It employs around 2,500 journalists and 600 photojournalists in about 200 locations worldwide. Reuters is one of the largest news agencies in the world.
The agency was estab ...
reported that during the 2010s Rite Aid had deployed
facial recognition video surveillance
Closed-circuit television (CCTV), also known as video surveillance, is the use of video cameras to transmit a signal to a specific place, on a limited set of monitors. It differs from broadcast television in that the signal is not openly tr ...
systems and components from FaceFirst, DeepCam LLC, and other vendors at some retail locations in the United States.
Cathy Langley, Rite Aid's vice president of asset protection, used the phrase "feature matching" to refer to the systems, a technical term related to the process of
image feature extraction in the field of
artificial intelligence for video surveillance
Artificial intelligence for video surveillance utilizes computer software programs that analyze the audio and images from video surveillance cameras in order to recognize humans, vehicles, objects, attributes, and events. Security contractors pro ...
, and said that usage of the systems resulted in less violence and organized crime in the company's stores, while former vice president of asset protection Bob Oberosler emphasized improved safety for staff and a reduced need for the involvement of
law enforcement organizations.
In a 2020 statement to Reuters in response to the reporting, Rite Aid said that it had ceased using the facial recognition software and switched off the cameras.
According to director
Read Hayes of the National
Retail Federation Loss Prevention Research Council, which in 2018 called facial recognition technology "a promising new tool" worth evaluating, Rite Aid's surveillance program was either the largest or one of the largest programs in retail.
The Home Depot
The Home Depot, Inc., is an American multinational home improvement retail corporation that sells tools, construction products, appliances, and services, including fuel and transportation rentals. Home Depot is the largest home improvement re ...
,
Menards
Menards is an American home improvement retail company headquartered in Eau Claire, Wisconsin. Menards is owned by founder John Menard Jr. through his privately held company, Menard, Inc. It has 335 stores in 15 states: Illinois, Indiana, Iowa ...
,
Walmart
Walmart Inc. (; formerly Wal-Mart Stores, Inc.) is an American multinational retail corporation that operates a chain of hypermarkets (also called supercenters), discount department stores, and grocery stores from the United States, headquarter ...
, and
7-Eleven
7-Eleven, Inc., stylized as 7-ELEVE, is a multinational chain of retail convenience stores, headquartered in Dallas, Texas. The chain was founded in 1927 as an ice house storefront in Dallas. It was named Tote'm Stores between 1928 and 1946. A ...
are among other US retailers also engaged in
pilot programs or deployments of facial recognition technology.
Of the stores examined by Reuters, those in communities where
people of color
The term "person of color" ( : people of color or persons of color; abbreviated POC) is primarily used to describe any person who is not considered "white". In its current meaning, the term originated in, and is primarily associated with, the U ...
made up the largest racial or ethnic group were three times as likely to have the technology installed,
raising concerns related to the substantial history of
racial segregation
Racial segregation is the systematic separation of people into race (human classification), racial or other Ethnicity, ethnic groups in daily life. Racial segregation can amount to the international crime of apartheid and a crimes against hum ...
and
racial profiling in the United States Racial profiling by law enforcement at the local, state, and federal levels, leads to discrimination against people in the African American, Native American, Asian, Pacific Islander, Latino, Arab, and Muslim communities of the United States. Exampl ...
. Rite Aid said that the selection of locations was "data-driven", based on the theft histories of individual stores,
local and national crime data, and site infrastructure.
Customer loyalty and rewards programs
The wellness+ card is Rite Aid's free
shopping rewards card that started nationwide on April 18, 2010. It became a part of the newly launched
American Express
American Express Company (Amex) is an American multinational corporation specialized in payment card services headquartered at 200 Vesey Street in the Battery Park City neighborhood of Lower Manhattan in New York City. The company was found ...
-backed
Plenti
Plenti was an American rewards program created by American Express in 2015; the program ended in 2018. Plenti enabled users to earn points at one retailer and use them at another retailer enrolled in the program.
History
Plenti launched on May 4, ...
rewards program in May 2015. Rite Aid introduced wellness+ BonusCash on January 1, 2018. Customers can no longer earn
Plenti
Plenti was an American rewards program created by American Express in 2015; the program ended in 2018. Plenti enabled users to earn points at one retailer and use them at another retailer enrolled in the program.
History
Plenti launched on May 4, ...
points; instead, they earn BonusCash that can only be redeemed at Rite Aid. However, Rite Aid would remain a part of the Plenti rewards program, which would end on July 10, 2018. After
Plenti
Plenti was an American rewards program created by American Express in 2015; the program ended in 2018. Plenti enabled users to earn points at one retailer and use them at another retailer enrolled in the program.
History
Plenti launched on May 4, ...
was discontinued Rite Aid re-introduced the wellness+ program.
Merger with Eckerd and Brooks
![Eckerd logo](https://upload.wikimedia.org/wikipedia/commons/1/11/Eckerd_logo.svg)
On August 23, 2006, the ''Wall Street Journal'' announced that Rite Aid would be buying the
Eckerd Pharmacy and
Brooks Pharmacy
Brooks Pharmacy was a chain of more than 330 pharmacies located throughout New England and New York and was a well-recognized name in the New England pharmacy industry for several decades. The corporate headquarters were located in Warwick, Rhode ...
chains (
Brooks Eckerd Pharmacy) from the
Quebec
Quebec ( ; )According to the Canadian government, ''Québec'' (with the acute accent) is the official name in Canadian French and ''Quebec'' (without the accent) is the province's official name in Canadian English is one of the thirtee ...
-based
Jean Coutu Group
The Jean Coutu Group (PJC) Inc. is a Canadian drugstore chain headquartered in Varennes, Quebec. It has more than 400 franchised locations in New Brunswick, Ontario and Quebec under the PJC Jean Coutu, PJC Clinique, and PJC Santé banners. Th ...
for US$3.4 billion, and merging the two chains into one dominant pharmacy system. The company's shareholders overwhelmingly approved the merger on January 18, 2007. After some store closures and the conversion of the two chains was completed, Rite Aid became the dominant drug store retailer in the Eastern U.S., and the third largest drug retailer nationwide (behind the faster-growing
Walgreens
Walgreen Company, d/b/a Walgreens, is an American company that operates the second-largest pharmacy store chain in the United States behind CVS Health. It specializes in filling prescriptions, health and wellness products, health information, an ...
and
CVS chains).
Similar to what CVS experienced in the
Chicago metropolitan area
The Chicago metropolitan area, also colloquially referred to as Chicagoland, is a metropolitan area in the Midwestern United States. Encompassing 10,286 sq mi (28,120 km2), the metropolitan area includes the city of Chicago, its suburbs and hi ...
after its purchase of
Albertsons
Albertsons Companies, Inc. is an American grocery company founded and headquartered in Boise, Idaho.
With 2,253 stores as of the third quarter of fiscal year 2020 and 270,000 employees as of fiscal year 2019, the company is the second-large ...
drug store chains, the deal gave Rite Aid stores that were too close to each other. (Only 23 stores nationally were sold to Walgreens,
The Medicine Shoppe, or independent owners to meet federal regulations.) In many situations, especially in Pennsylvania, where both chains were dominant and had roots in the Commonwealth (Rite Aid originated in Scranton; Eckerd began in
Erie
Erie (; ) is a city on the south shore of Lake Erie and the county seat of Erie County, Pennsylvania, United States. Erie is the fifth largest city in Pennsylvania and the largest city in Northwestern Pennsylvania with a population of 94,831 a ...
, while
Thrift Drug
Thrift Drug was a U.S. pharmacy chain founded in 1935 and based in Pittsburgh, Pennsylvania.
The company was purchased by JCPenney in 1968, and was expanded greatly thereafter, serving as the flagship chain of JCPenney's pharmacy group. The cha ...
was popular in the
Pittsburgh
Pittsburgh ( ) is a city in the Commonwealth (U.S. state), Commonwealth of Pennsylvania, United States, and the county seat of Allegheny County, Pennsylvania, Allegheny County. It is the most populous city in both Allegheny County and Wester ...
area), there were, in some cases, neighboring Rite Aid stores. However, in March 2008, some of these overlapping stores were closed. Most of these stores that closed were pre-existing Rite Aids from before the Eckerd deal, since Eckerd had built newer, more modern stores with
drive-through pharmacies and larger space under ownership of both
JCPenney
Penney OpCo LLC, doing business as JCPenney and often abbreviated JCP, is a midscale American department store chain operating 667 stores across 49 U.S. states and Puerto Rico. Departments inside JCPenney stores include Mens, Womens, Boys, Gir ...
and
Jean Coutu Group
The Jean Coutu Group (PJC) Inc. is a Canadian drugstore chain headquartered in Varennes, Quebec. It has more than 400 franchised locations in New Brunswick, Ontario and Quebec under the PJC Jean Coutu, PJC Clinique, and PJC Santé banners. Th ...
; and the "moved to" sites were converted Eckerds. Employees at the closed stores were transferred to nearby ones, so no layoffs were necessary.
Rite Aid had sold some stores to
JCPenney
Penney OpCo LLC, doing business as JCPenney and often abbreviated JCP, is a midscale American department store chain operating 667 stores across 49 U.S. states and Puerto Rico. Departments inside JCPenney stores include Mens, Womens, Boys, Gir ...
's Thrift Drug chain in the mid-1990s shortly before JCPenney's acquisition of Eckerd and had also sold all of their Massachusetts stores to Brooks in 1995, bringing some existing Eckerd and Brooks stores that were once Rite Aids full circle.
Because Eckerd was previously owned by JCPenney, Eckerd stores accepted JCPenney charge cards. Since the merger, all Rite Aids take JCPenney charge cards, a policy also followed by competitor
CVS pharmacy
CVS Pharmacy, Inc. is an American retail corporation. A subsidiary of CVS Health, it is headquartered in Woonsocket, Rhode Island. It was also known as, and originally named, the Consumer Value Store and was founded in Lowell, Massachusetts, in ...
, which had earlier acquired most of the Eckerd chain in the southeastern United States.
With the acquisition of Brooks Eckerd, at its peak in 2008, Rite Aid had a total of 5,059 stores and employed 112,800 people.
Market exits
On January 4, 2008, Rite Aid Corporation announced that it would terminate operation of its 28 Rite Aid stores in the
Las Vegas, Nevada
Las Vegas (; Spanish for "The Meadows"), often known simply as Vegas, is the 25th-most populous city in the United States, the most populous city in the state of Nevada, and the county seat of Clark County. The city anchors the Las Vegas ...
, area and had signed an agreement to sell patient prescription files from that metro market to
Walgreens
Walgreen Company, d/b/a Walgreens, is an American company that operates the second-largest pharmacy store chain in the United States behind CVS Health. It specializes in filling prescriptions, health and wellness products, health information, an ...
. The company said Las Vegas was a non-core market that had not been contributing to overall results, and it had not opened a new store there since 1999. One Nevada store would remain open in
Gardnerville, near the
California
California is a U.S. state, state in the Western United States, located along the West Coast of the United States, Pacific Coast. With nearly 39.2million residents across a total area of approximately , it is the List of states and territori ...
border, where Rite Aid at the time had more than 600 stores.
On February 5, 2009, Rite Aid announced that it would terminate operations of seven Rite Aid stores in San Francisco, along with five stores in eastern Idaho through a sale to Walgreens.
Rite Aid formerly had a presence in the
Columbus, Ohio
Columbus () is the state capital and the most populous city in the U.S. state of Ohio. With a 2020 census population of 905,748, it is the 14th-most populous city in the U.S., the second-most populous city in the Midwest, after Chicago, and t ...
market, but has since sold off its stores there to CVS.
Sale of stores to Walgreens
![Aisles and goods in the Rose Hill Rite Aid](https://upload.wikimedia.org/wikipedia/commons/0/07/Aisles_and_goods_in_the_Rose_Hill_Rite_Aid.jpg)
On October 27, 2015,
Walgreens
Walgreen Company, d/b/a Walgreens, is an American company that operates the second-largest pharmacy store chain in the United States behind CVS Health. It specializes in filling prescriptions, health and wellness products, health information, an ...
announced that it would acquire Rite Aid for $9.4 billion, pending regulatory and shareholder approval. The deal would have resulted in a merger of two of the United States' three largest pharmacy chains.
Walgreens planned to keep the Rite Aid name on existing stores when the deal went through, though the long-term plans for the Rite Aid name were unknown. On December 21, 2016, it was announced that
Fred's
Fred's Inc. (stylized ''FRED'S'') was a retail store chain headquartered in Memphis, Tennessee, operating in 15 states in the southeastern United States. As of June, 2019 Fred's operated 396 locations, of which 155 are pharmacies, and the remain ...
would acquire 865 Rite Aid stores as a result of the merger for $950 million, for
antitrust
Competition law is the field of law that promotes or seeks to maintain market competition by regulating anti-competitive conduct by companies. Competition law is implemented through public and private enforcement. It is also known as antitrust l ...
reasons. In January 2017, Rite Aid and Walgreens cut the price of the merger to approximately $6.8 billion and delayed the merger by six months. On January 31, 2017, it was reported that the workers' union 1199SEIU United Healthcare Workers East, representing 6,000 Rite Aid Corp workers, was opposed to the sale of the Rite Aid stores to Fred's Inc.
On June 29, 2017, Walgreens announced the merger was canceled, adding that it would be purchasing 2,186 stores from Rite Aid for $5.2 billion plus a $325 million penalty for canceling. Most experts had thought that the merger would be completed within a few weeks. The merger would have had about 46% of the market share.
The revised deal—now not including Fred's at all—effectively would have seen Rite Aid exit the
southeastern United States
The Southeastern United States, also referred to as the American Southeast or simply the Southeast, is a geographical region of the United States. It is located broadly on the eastern portion of the southern United States and the southern por ...
.
On September 19, 2017, the
Federal Trade Commission
The Federal Trade Commission (FTC) is an independent agency of the United States government whose principal mission is the enforcement of civil (non-criminal) antitrust law and the promotion of consumer protection. The FTC shares jurisdiction ov ...
(FTC) approved a fourth deal agreement, this time allowing Walgreens to purchase only 1,932 Rite-Aid stores for $4.38 billion.
The sale was completed on March 27, 2018. Three distribution centers and related inventory were transferred after September 1, 2018, when the stores were rebranded to Walgreens. The 1,932 stores showed banners saying "Pharmacy now operated by Walgreens" or "We now have a Walgreens pharmacy" in the meantime. After the acquisition, Walgreens closed about 600 stores over 18 months starting in spring 2018, mostly Rite Aid stores within a mile of an existing Walgreens.
As of fiscal year 2022,
Pennsylvania
Pennsylvania (; ( Pennsylvania Dutch: )), officially the Commonwealth of Pennsylvania, is a state spanning the Mid-Atlantic, Northeastern, Appalachian, and Great Lakes regions of the United States. It borders Delaware to its southeast, ...
with 494 stores is home to the largest number of Rite Aids, followed by
California
California is a U.S. state, state in the Western United States, located along the West Coast of the United States, Pacific Coast. With nearly 39.2million residents across a total area of approximately , it is the List of states and territori ...
and
New York
New York most commonly refers to:
* New York City, the most populous city in the United States, located in the state of New York
* New York (state), a state in the northeastern United States
New York may also refer to:
Film and television
* '' ...
with 487 and 281 respectively.
Attempted acquisition by Albertsons
On February 20, 2018,
Albertsons
Albertsons Companies, Inc. is an American grocery company founded and headquartered in Boise, Idaho.
With 2,253 stores as of the third quarter of fiscal year 2020 and 270,000 employees as of fiscal year 2019, the company is the second-large ...
announced plans to acquire the remainder of Rite Aid, including the 2,600 stores not acquired by Walgreens, in a merger of equals, subject to shareholder and regulatory approval. On August 8, 2018, Rite Aid announced that the plan had failed to please shareholders and the proposed acquisition would be cancelled.
Acquisition of Bartell Drugs
In October 2020, Rite Aid announced the acquisition of the privately held
Bartell Drugs, a 67-location Seattle-area chain, for $95 million. Some customers have criticized the acquisition with reports of heavy staff turnover and computer system glitches.
Finances
For the second quarter of 2019, Rite Aid reported basic and
diluted earnings of -0.34 per share. This is significantly down from prior quarters' report of .20 per share.
Litigation
''Hall v. Rite Aid Corporation''
In the employee seating lawsuit (''Hall v. Rite Aid Corporation'', San Diego County Superior Court), the parties reached a class action settlement for $18 million plus institution of a two-year pilot seating program for front-end checkstands. On September 14, 2018, the Court granted preliminary approval of the settlement. On November 16, 2018, the court granted final approval of the settlement.
In re National Prescription Opiate Litigation
As reported by Rite Aid, the company is a defendant in the consolidated multidistrict litigation proceeding, In re National Prescription Opiate Litigation, pending in the U.S. District Court for the Northern District of Ohio. Various plaintiffs (such as counties, cities, hospitals, and third-party payors) allege claims concerning the impacts of widespread opioid abuse against defendants along the pharmaceutical supply chain, including manufacturers, wholesale distributors, and retail pharmacy chains.
''Byron Stafford v. Rite Aid Corp.'' and ''Robert Josten v. Rite Aid Corp.''
As reported by Rite Aid, the company is involved in two consumer class action lawsuits in the United States District Court for the Southern District of California, alleging that it has overcharged customers' insurance companies for prescription drug purchases, resulting in overpayment of co-pays.
See also
*
CVS Pharmacy
CVS Pharmacy, Inc. is an American retail corporation. A subsidiary of CVS Health, it is headquartered in Woonsocket, Rhode Island. It was also known as, and originally named, the Consumer Value Store and was founded in Lowell, Massachusetts, in ...
*
Walgreens
Walgreen Company, d/b/a Walgreens, is an American company that operates the second-largest pharmacy store chain in the United States behind CVS Health. It specializes in filling prescriptions, health and wellness products, health information, an ...
References
External links
Rite Aid Official website
{{Authority control
Pharmacies of the United States
Companies based in Cumberland County, Pennsylvania
Companies based in Philadelphia
American companies established in 1962
Retail companies established in 1962
Health care companies established in 1962
1962 establishments in Pennsylvania
Companies listed on the New York Stock Exchange
Health care companies based in Pennsylvania
1960s initial public offerings