Rite Aid Corporation

Is Rite Aid still in business?
No. Rite Aid ceased all retail operations by late 2025 after filing for Chapter 11 bankruptcy for the second time in May 2025. The company's pharmacy assets and prescription files were sold to CVS, Walgreens, Albertsons, Kroger, and Giant Eagle. The bankruptcy case was closed in January 2026.

Did Walgreens buy Rite Aid?
Walgreens attempted a full acquisition of Rite Aid in 2015 for approximately $9.4 billion, but the FTC raised antitrust concerns. Instead, Walgreens acquired approximately 1,932 individual Rite Aid stores in 2017 for approximately $4.375 billion. In 2025, during Rite Aid's second bankruptcy, Walgreens acquired additional Rite Aid prescription files and stores as part of the court-approved asset sale.

Why did Rite Aid go bankrupt?
Rite Aid filed for Chapter 11 bankruptcy in October 2023 due to accumulated debt from historical acquisitions, declining same-store sales, opioid-related litigation settlements, and an inability to invest in store modernization. After emerging in 2024, the company filed for bankruptcy again in May 2025 because vendors demanded stricter payment terms, promised capital failed to materialize, and the company continued to lose market share.

Who bought Rite Aid's stores?
Rite Aid's pharmacy assets and prescription files were sold to multiple buyers during the second bankruptcy in 2025. CVS Pharmacy, Walgreens, Albertsons, Kroger, and Giant Eagle were among the 13 buyers of prescription files. CVS also acquired many Rite Aid and Bartell Drug store locations. Dollar Tree acquired some unexpired leases.

What happened to Rite Aid employees?
At the time of the second bankruptcy filing in May 2025, Rite Aid employed approximately 24,500 people. The company stated that preserving jobs for as many associates as possible was a key priority during the sale process. Some employees were transitioned to the acquiring pharmacy operators, though the majority of positions were eliminated as stores closed.

What was Rite Aid's peak size?
At its peak, Rite Aid operated over 2,200 stores across the United States. After the 2017 partial sale to Walgreens (approximately 1,932 stores), the company operated approximately 2,000 remaining stores. By the time of the first bankruptcy in October 2023, the store count had been reduced to approximately 2,100. After the first restructuring, approximately 1,700 stores remained. At the second bankruptcy filing in May 2025, approximately 1,275 stores remained.

Who founded Rite Aid?
Rite Aid was founded in 1962 by Alex Grass in Scranton, Pennsylvania. The first store was called Thrift D Discount Center and was renamed Rite Aid in 1968. Grass's son, Martin Grass, later became CEO but was convicted in the 1999 accounting fraud scandal.

Alex Grass opened the first Rite Aid store in 1962 as Thrift D Discount Center in Scranton, Pennsylvania. The chain was renamed Rite Aid in 1968, the same year the company went public. Through the 1970s and 1980s, Rite Aid expanded aggressively, becoming one of the largest pharmacy chains in the Eastern United States.

In the 1990s, Rite Aid made several significant acquisitions. The attempted acquisition of Revco Drug Stores in 1996 was blocked by the FTC. The company acquired Thrifty PayLess in 1997 for approximately $1.4 billion and PCS Health Systems in 1999 for $1.5 billion. The PCS acquisition proved financially disastrous and was quickly unwound. In 1999, a major accounting fraud scandal emerged in which former executives were convicted of securities fraud for overstating earnings. The scandal required significant earnings restatements and a complete management change.

In 2015, Walgreens attempted a full acquisition of Rite Aid for approximately $9.4 billion. The FTC raised serious antitrust concerns, and the parties renegotiated to a limited store acquisition in 2017. Walgreens acquired approximately 1,932 individual Rite Aid stores for approximately $4.375 billion, leaving Rite Aid as a smaller, weaker independent operator.

Opioid-related litigation added to Rite Aid's financial burden. The company faced allegations that its pharmacies dispensed opioids without adequate oversight of prescribing patterns. In 2023, the US Department of Justice filed a civil complaint against Rite Aid alleging that the company filled prescriptions for controlled substances that were not for legitimate medical purposes. The company reached settlements with multiple states, including approximately $30 million with the State of West Virginia.

On October 15, 2023, Rite Aid filed for Chapter 11 bankruptcy. The filing was driven by accumulated debt from historical acquisitions, declining same-store sales, opioid-related litigation settlements, and an inability to invest sufficiently in store modernization. As part of the restructuring, the company closed approximately 500 underperforming stores. Rite Aid emerged from bankruptcy in 2024 as a restructured company with approximately 1,700 stores, significantly less debt, and new ownership held by former senior creditors who received equity in exchange for debt.

The post-emergence period was short-lived. Vendors demanded stricter payment terms, promised capital from investors failed to materialize, and the company continued to lose market share. On May 5, 2025, Rite Aid filed for Chapter 11 bankruptcy for the second time in eight months. At the time of the second filing, the company operated approximately 1,275 stores and three distribution centers in 15 states, employing approximately 24,500 people. The company secured $1.94 billion in financing commitments to support operations during the sale process.

On May 21, 2025, a US bankruptcy court approved the sale of most of Rite Aid's pharmacy assets. Customer prescription files were sold to 13 buyers, including CVS Pharmacy, Walgreens, Albertsons, Kroger, and Giant Eagle. CVS also acquired many Rite Aid and Bartell Drug stores. Approximately 1,000 store locations were transitioned to new operators. Dollar Tree acquired some unexpired leases.

By late 2025, Rite Aid had closed all of its remaining locations. The company's website was converted to provide prescription transfer information for former customers. The bankruptcy case was closed on January 6, 2026, with remaining matters consolidated under a single case (Lakehurst and Broadway Corporation, Case No. 25-14831).

Rite Aid published sustainability and corporate social responsibility reports prior to its first bankruptcy filing. These reports covered environmental initiatives, community health programs, and diversity and inclusion efforts. However, sustainability reporting was limited in scope compared to larger pharmacy competitors and was discontinued after the first bankruptcy.

The most significant ethical and legal issue facing Rite Aid was its role in the opioid epidemic. The US Department of Justice filed a civil complaint in 2023 alleging that Rite Aid filled prescriptions for controlled substances that were not for legitimate medical purposes, including prescriptions for excessive quantities of opioids. The company faced federal and state regulatory action and civil litigation from multiple states. These allegations and the resulting settlements contributed to the financial pressures that led to the first bankruptcy filing.

Rite Aid faced numerous controversies throughout its history:

Accounting fraud scandal (1999): Former Rite Aid executives were convicted of securities fraud for overstating earnings in the late 1990s. The scandal required significant earnings restatements and a complete management overhaul. CEO Martin Grass (son of founder Alex Grass) and CFO Frank Bergonzi were among those convicted.

Opioid litigation: The US Department of Justice filed a civil complaint in 2023 alleging that Rite Aid pharmacists filled prescriptions for controlled substances that were not for legitimate medical purposes. The company reached settlements with multiple states, including approximately $30 million with West Virginia. The opioid litigation was a significant factor in the first bankruptcy filing.

Failed Walgreens merger (2015-2017): The attempted full acquisition by Walgreens for approximately $9.4 billion was blocked by the FTC on antitrust grounds. The parties renegotiated to a limited store acquisition, which weakened Rite Aid by removing its best-performing stores while leaving it with a smaller, less competitive footprint.

Two bankruptcies (2023 and 2025): Rite Aid's two bankruptcy filings within eight months drew significant scrutiny. The second filing raised questions about the effectiveness of the first restructuring and whether the company was viable as an independent entity. Analysts noted that vendor reluctance to ship except under strict terms following the 2023 bankruptcy, combined with the failure of promised capital to materialize, created a "perfect storm" that made the second filing inevitable.

Store closures and community impact: The closure of all Rite Aid stores in 2025 raised concerns about pharmacy access in underserved communities, particularly in rural and low-income urban areas where Rite Aid was often the only nearby pharmacy. The transfer of prescription files to other pharmacies did not fully address the gap in physical pharmacy access in some communities.