Rite Aid Facing Bankruptcy, Amid Opioid Lawsuits , and Annual Losses.
Associated Press reports that Rite Aid has filed for bankruptcy protection ahead of a plan to sell a portion of its business while attempting to restructure.
Late on October 15, the drugstore chain announced that it had obtained $3.45 billion in financing to support the company through the Chapter 11 process.
The news comes as the company faces heavy losses and a wave of lawsuits related to the ongoing opioid crisis in the United States.
According to Rite Aid, the newly acquired financing will “significantly reduce the company’s debt” while helping to “resolve litigation claims in an equitable manner.”.
The company is reportedly awaiting court approval for a number of motions intended to support its business.
Those motions include efforts to avoid interruptions to paying employee wages and benefits, while also paying vendors in full.
AP reports that Rite Aid, which operates over 2,100 drugstores in the U.S., has been posting annual losses for several years.
The Philadelphia-based company has been forced to close some stores and cut costs while dealing with long-standing financial obstacles.
Rite Aid is one of several major U.S. drugstore chains to face financial risks amid a series of lawsuits over opioid prescriptions.
Last year, Rite Aid reached several settlements in opioid-related cases, including one with the state of West Virginia for as much as $30 million.
Last year, Rite Aid reached several settlements in opioid-related cases, including one with the state of West Virginia for as much as $30 million