Drugstore chain Rite Aid gave in to the pressures of a generally bad environment for pharmaceuticals with slowing sales and an opioid lawsuit as well.
Other reasons include reduced demand for COVID-19 vaccines, reduced members in its prescription drug plan, and customer loss from its Elixir pharmacy benefits.
Rite Aid has also not kept up with rivals CVS and Walgreens. CVS opened in-store Minute Clinics and their stores have become urgent care facilities.
Walgreens struck expensive deals to expand its healthcare reach as it became the majority-owner of primary care company VillageMD.
But even these rivals are no match for other retailers like Amazon, Walmart, and Costco, offering staples like toothpaste and shampoo at cheaper rates.
Revenues fell from $6.1 billion to $5.6 billion last quarter and net losses are at $5.57/share compared to $2.03 /share last year for the same period.
Lenders have agreed to provide Rite Aid $3.45 billion in new funding to help with the restructuring.
The Department of Justice filed a lawsuit earlier this year against it for allegedly filling out unlawful prescriptions for controlled substances.
Rite Aid has denied the allegations asking a court to dismiss the lawsuit. It hopes to bounce back with a better strategy and to soon scale newer heights.