Pharmacy deserts get worse as Walgreens announces closures

Walgreens shutters stores, Rite Aid asks bankruptcy court for approval

What you probably already know: Walgreens on Thursday announced it would close “a significant number” of its 8,600 stores across the U.S. as the retailer struggles with financial pressures on its core pharmacy business. CEO Tim Wentworth called the move a turnaround. Meanwhile, Rite Aid on Thursday asked U.S. Bankruptcy Court to approve a restructuring plan that cut $2 billion in debt and turns over control to a group of lenders.

Why? While prescription drug prices are rising, retailers aren’t the ones collecting those profits. Rather, pharmacy-benefit managers that negotiate retail drug prices on behalf of insurers have driven down costs, while new competitors like Amazon and telehealth companies have eaten up what little margin remained.

What it means: Rite Aid has closed at least 200 stores since its bankruptcy filing in October, and, with the Walgreens store closures, that will mean at hundreds of pharmacies across the U.S. will close. Both stores said they’d target “underperforming” stores, which often means stores in less wealthy neighborhoods. That can make it more difficult for people in those areas to get access to their medications, as well as other services like vaccinations.

What happens now? A recent survey by Cardinal Health found that 2,177 rural towns with populations up to 5,000 people didn’t have a pharmacy within 10 miles, and urban areas with mostly Black or Hispanic populations were more likely to be pharmacy deserts. These closures are likely to make this issue worse and increase the need for online and telehealth pharmacies to do outreach to populations in pharmacy deserts.

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