CVS Health Thursday night confirmed plans to “acquire and operate” 64 Rite Aid stores in Idaho, Oregon and Washington states as part of a bidding process following Rite Aid’s filing last week for bankrtuptcy protection.
CVS appears to be the biggest buyer of Rite Aid stores and pharmacy assets. CVS said it has also agreed to “acquire the prescription files of 625 Rite Aid pharmacies across fifteen states in areas that CVS serves,” CVS said. “Of the 625 file buys, 78 are in Idaho, Oregon and Washington.” Currently, CVS has more than 9,000 CVS Pharmacy locations in 50 states and Washington, D.C.
The CVS disclosure comes within hours after Rite Aid said “it has successfully entered into a series of sale agreements and pharmacy services transition agreements,” Rite Aid said. “This includes the rolling transition of pharmacy assets from more than 1,000 store locations across the U.S. to operators including CVS Pharmacy, Walgreens, Albertsons, Kroger, and Giant Eagle, among others, as well as the sale and operation by CVS Pharmacy of many Rite Aid and Bartell Drugs stores located in Washington, Oregon, and Idaho.”
It’s unclear whether Walgreens or other buyers will end up operating any Rite Aid brick-and-mortar stores or whether Walgreens and the grocery store chains are only interested in the patient prescription files. Walgreens had no comment when reached Thursday evening.
During the transition to CVS, Walgreens and other buyers, RiteAid said “stores will remain open, and customers can continue to access their pharmacy services, including prescription refills and immunizations, without interruption.”
“A key priority for Rite Aid is to ensure that as many of our loyal customers as possible continue to receive the pharmacy services and care they require without interruption,” Rite Aid chief executive officer Matt Schroeder said. “These agreements ensure our pharmacy customers will experience a smooth transition while preserving jobs for some of our valued team members.”
By buying the prescription files, CVS and Walgreens and others would avoid taking on more debt from brick-and-mortar stores. It’s common for pharmacy chains, other retailers and grocers in the pharmacy business to pursue prescription files and related pharmacy assets during Chapter 11 bankruptcy proceedings.
In 2019, for example, Walgreens Boots Alliance, CVS Health and Rite Aid were among the winning bidders for prescription files and related pharmacy assets auctioned off from 120 Shopko locations as part of the general merchandise retailer’s financial restructuring at that time.
As of Thursday night, Rite Aid operated 1,240 stores in the U.S. with most of them located in California, Pennsylvania and New York, according to the drugstore chain’s store locator.
CVS said its transaction with Rite Aid is subject to the approval of the U.S. Bankruptcy Court for the District of New Jersey, applicable regulatory approvals, and other customary closing conditions. “Additional details about the transaction will be available following the upcoming hearing on approval of the sale to CVS Pharmacy,” CVS said.
