Rite Aid’s across America have recently been closing due to the company going bankrupt. The company filed for Chapter 11 bankruptcy in May of 2025. This is the second time they have filed for bankruptcy in the past three years, the first time being in October of 2023. As of now, there are 70 Rite Aid stores left, only in 12 of the 50 states.
There are many reasons Rite Aid filed for bankruptcy, one being its high debt. To grow faster, Rite Aid bought out other chains like PayLess Drug Stores and Brooks and Eckerd. However, like with many big moves, there was a downside. The company borrowed a lot of money to pay for these purchases, which left it with a huge pile of debt. The debt is also due to the business model and competing with other pharmacies like Walgreens and CVS. Rite Aid’s core business plan began to fall behind other competitors, lacking in online shopping, and its business model.
When Rite Aid initially opened, it tried to get ahead of its competitors by using an aggressive growth-by-acquisition strategy in the 1990s and 2000s. This caused them to end up with massive amounts of debt. Then, when they fell behind in business, they had no money to catch up and were forced to file for bankruptcy for the first and second time. They were also being sued for opioids.
The Opioid litigation was also a large point of Rite Aid going bankrupt. According to the Department of Justice, Rite Aid was being sued over 1600 times, alleging that it ignored “red flags” and illegally filled prescriptions for controlled substances. They were also sued for suspicious prescribers. Rite Aid was having doctors who had been repeatedly flagged internally by Rite Aid pharmacists fill prescriptions. The company was also allegedly ignoring its own pharmacists’ concerns and intentionally deleting internal notes about suspicious prescribing practices. The company settled with the government in July 2024 for nearly $410 million.
Rite Aid’s bankruptcy is due to many issues, some of its own making. Their issues included poor money management, as well as opioid issues. The company also had trouble keeping up with changes in the market. Whether they can bounce back and stay in the game is still unclear, but the challenges ahead are serious. As of now, Rite Aid’s future is uncertain as it works through bankruptcy. If the company can lower its debt, simplify its operations, and settle legal issues, it could get stronger.
Sources: CNN, Frego And Associates, Department of Justice, Rite-Aid, NBC
