Fashion tape rite aid9/22/2023 ![]() ![]() ![]() Justin Sullivan-Getty Images Missing the boat on the health care transformation Providing vaccination jabs and swabbing noses added about $500 million in revenue last year, but it also meant some aspects of Donigan’s strategy have been on the back burner. Also on the health care front, she hopes to use the company’s small pharmacy benefits business to go after midsize employers the industry’s larger players ignore.Įxecuting on this plan hasn’t gone quite as Donigan hoped-in part because the turnaround she envisioned, unveiled with fanfare in New York on March 16, 2020, had to take a back seat to the pandemic. The CEO also wants Rite Aid to make much greater use of its 6,400 pharmacists to provide vaccinations, treatment advice, and health services. Donigan’s turnaround plan is focused on expanding and increasing dominance in the markets where Rite Aid remains a strong competitor-including New York City, Los Angeles, and its hometown of Philadelphia. Building Rite Aid back into a growing, sustainable business means leaving the rivalry for national supremacy to CVS and Walgreens. ![]() But simply keeping the company limping along isn’t enough, she says. What happens if it reaches that point? A downward spiral that could potentially end in bankruptcy, taking shares from their current $6 or so all the way down to zero.Īvoiding such doomsday scenarios is job one for CEO Heyward Donigan, who has led the chain since 2019. The company is also dragging around $3 billion in debt-one reason that an April Deutsche Bank research note warned that the company was in danger of hitting a “dramatic negative inflection point” where it no longer has the funds to invest in the business. Rite Aid’s financial difficulties are far deeper and more perilous than simply looking puny compared with its competitors. ![]()
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