Major U.S. pharmacy chain Rite Aid said Sunday that it has filed for bankruptcy and obtained $3.45 billion in fresh financing as it carries out a restructuring plan while coping with falling sales and opioid-related lawsuits.

In 2022, Rite Aid settled for up to $30 million to resolve lawsuits alleging pharmacies contributed to an oversupply of prescription opioids. It said it had reached an agreement with its creditors on a financial restructuring plan to cut its debt and position itself for future growth and that the bankruptcy filing was part of that process.

The plan will “significantly reduce the company’s debt” while helping to “resolve litigation claims in an equitable manner,” Rite Aid said.

  • Moobythegoldensock@lemm.ee
    link
    fedilink
    English
    arrow-up
    73
    ·
    edit-2
    1 year ago

    Rite Aid got caught knowingly filling illegal and suspicious opioid prescriptions, got slapped with a lawsuit, and now is restructuring.

    They fueled the opioid crisis for profit, got caught, and now the courts are bailing them out of their debts

  • qooqie@lemmy.world
    link
    fedilink
    arrow-up
    31
    arrow-down
    4
    ·
    edit-2
    1 year ago

    I won’t pretend to know a ton about finance, but I don’t like that so many large companies can get away with going bankrupt and then just “restructuring” instead of going out of business. Maybe it’s actually a good thing, I’m not sure, it definitely seems kinda scummy to me though.

    • FlowVoid@lemmy.world
      link
      fedilink
      English
      arrow-up
      9
      ·
      edit-2
      1 year ago

      Chapter 11 is basically a debt consolidation plan overseen by the courts. It doesn’t wipe out debt, in fact it requires creditors to agree to the plan. It is not just for large companies, small companies use it too.

      There is even a version for individuals called Chapter 13. But it’s more useful to companies than individuals, since debt consolidation usually involves selling part ownership of the company and that’s obviously not an option for individuals.

    • dogslayeggs@lemmy.world
      link
      fedilink
      arrow-up
      6
      ·
      1 year ago

      Individuals can do this, too. You don’t even have to be rich. It’s called Chapter 11, and it isn’t just for companies. That said, it’s just a pause while you restructure your finances and requires an approved get-well plan. Individuals would have a hard time coming up with a get-well plan that doesn’t include “get a better job” or “don’t pay off this huge debt.”

    • RedditWanderer@lemmy.world
      link
      fedilink
      arrow-up
      6
      arrow-down
      1
      ·
      edit-2
      1 year ago

      If you ran a corporation, you too could benefit from this, but obviously the minority of people are in that situation, and corporations have lobbied for us to spend immense funds supporting that “kind” of socialism. They should just go bankrupt, and instead fund the people who will have lost their job, and directly invest there to get them back onto the market.

      3500 million dollars to go “figure it out”. It’s meant for the company to make good by its clients, but we know that’s not what’s going to happen

      • FlowVoid@lemmy.world
        link
        fedilink
        English
        arrow-up
        1
        ·
        edit-2
        1 year ago

        I’m not sure what you mean by “that kind of socialism”, but rest assured that the $3.5b didn’t come from the government. Rite Aid got the money all by itself, mostly by selling off parts of its own business.

        The courts are simply there to make sure Rite Aid doesn’t do anything sneaky with the money before paying off its creditors.

        • RedditWanderer@lemmy.world
          link
          fedilink
          arrow-up
          2
          ·
          1 year ago

          I was talking a out bailouts specifically yeah, so not in this case.

          Chapter 11 is to protect against creditors and force them to cooperate, prevent lawsuits and seizing assets. IN EXCHANGE the court promises to make sure the creditors get their share in the end.

          Guess how it always ends…

    • Astroturfed@lemmy.world
      link
      fedilink
      arrow-up
      2
      arrow-down
      2
      ·
      1 year ago

      It’s just code for it’s hard for them to pay their debts so they want to Welch on some of the ones they don’t want to pay. (Like pesky lawsuits for fueling the opioid epidemic).

  • key@lemmy.keychat.org
    link
    fedilink
    English
    arrow-up
    7
    ·
    1 year ago

    TIL Rite Aid still exists

    Walgreens attempted to buy Rite Aid for about $9.4 billion in a deal announced in 2015. But the larger drugstore chain scaled back its ambition a couple years later and bought only a chunk of Rite Aid, around 1,900 stores, to get the deal past antitrust regulators.