Major U.S. pharmacy chain Rite Aid has filed for bankruptcy, obtained fresh funding, and initiated restructuring while dealing with declining sales and opioid-related lawsuits.
The bankruptcy filing: Rite Aid declared bankruptcy and secured $3.45 billion in new funding as part of a restructuring plan on Sunday.
* In 2022, Rite Aid agreed to a settlement up to $30 million to resolve lawsuits alleging pharmacies contributed to an oversupply of prescription opioids.
* The company said the bankruptcy filing was part of the process to reduce debt and resolve litigation claims equitably.
The leadership transition: The pharmacy chain has appointed Jeffrey Stein as its CEO, replacing interim CEO Elizabeth Burr, who remains on the board.
* Stein, who heads a financial advisory firm, took over on Sunday.
Noncompliance with listing standards: Rite Aid notified the New York Stock Exchange earlier this month that it wasn’t in compliance with listing standards, but its stock continues to trade during a grace period.
* The bankruptcy filing and violation of listing standards won’t affect its business operations or its reporting requirements to the U.S. Securities and Exchange Commission.
Store closures and financial challenges: Rite Aid plans to close some underperforming stores among its more than 2,100 pharmacies located in 17 states.
* It reported its revenue fell to $5.7 billion in the fiscal quarter ending June 3, down from $6.0 billion a year earlier, with a net loss of $306.7 million.
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