In , the company was acquired by Pantry Pride, a supermarket chain, and the brand faded a few years later. Big B. The drugstore was established by now-defunct grocer Bruno's in in Alabama. Revco, a different pharmacy chain, acquired the company in Drugs as CVS pharmacies.
Brooks Pharmacy. Launched in , the pharmacy was once a mainstay in New York and New England. After a series of failed mergers and acquisitions in the early s, the struggling pharmacy chain was purchased by Rite Aid in The Brooks name disappeared shortly after. Eckerd was one of the major national drugstore chains in the U. After Eckerd was sold, it merged with Brooks Pharmacy. Ultimately, Rite Aid acquired the stores in The Eckerd brand disappeared from stores the following year.
Gray Drug. The drugstore opened in Ohio in and later expanded into Florida and Maryland. Just ten years after its first store opened, Rite Aid operated locations in 10 states.
A store acquisition along the east coast expanded Rite Aid's holdings beyond 2, locations. Rite Aid acquired twenty-four Hooks Drug stores from Revco in , selling nine of those stores to Perry Drug Stores, a Michigan-based pharmacy chain.
One year later, the store Perry chain itself was acquired by Rite Aid. The acquisition of Thrifty PayLess included the Northwest-based Bi-Mart membership discount stores, which was sold off in Acquisitions of Harco, Inc. A partnership with drugstore.
In the fall of , Rite Aid was the subject of several media reports about its aggressive marketing of pharmaceutical products and other consumer-unfriendly practices, including selling date-sensitive products well past the due dates.
Rite-Aid is the largest pharmacy chain in California. It has recently been investigated by government regulators in California, Washington, and Oregon. Rite Aid also had a major accounting scandal that led to the departure and subsequent jail time of several top ranking executives, including the CEO.
Sammons instituted a number of reforms of Rite Aid's business and has returned the company to credibility and profitability. July , Rite Aid agreed to improve their pharmacy complaint process by implementing a new program to respond to consumer complaints. Additional benefits also include discounts on certain days of the week, as well as unadvertised sales on merchandise.
This program is very similar to the former Revco program which was called "Senior Shoppers"; Rite Aid attempted to purchase Revco in Early in , the UAW announced that its members' prescriptions would be filled through mail order.
This decision by the union disproportionately affected Rite Aid as it has predominant market strength where the UAW has its highest union density nationally. The company's shareholders overwhelmingly approved the merger on January 18, Similar to what CVS has gone through in Chicagoland after its purchase of Albertson's drug store chains, the deal has left Rite Aid with some locations in close proximity to each other.
In the company continued to expand and enhance the technology available to its stores. In September of that year, it disposed of its Company earnings, however, continued to absorb the cost of the enormous acquisitions the company made in The company in continued to focus on the integration of both its past and present acquisitions.
Rite Aid added 1, store computer systems, and it enhanced 2, pharmacy terminals. The pharmacy terminals enabled drug interaction analysis and cumulative tax information, all of which resulted in speedier prescription service. Prescription sales for advanced Rite Aid's computerization also propelled the company toward greater efficiency, enabling it to cut back on unnecessary corporate staffing in spite of the fact that the company's store count had continued to grow.
From to , Rite Aid acquired more than drugstores and opened new stores, closing only units. Within this period, Rite Aid's store count grew by nearly 60 percent. In Rite Aid added 68 stores and bought prescription records from 65 drugstores in Washington, D. While some organizations viewed the recession of the early s as a bleak period, Alex and Martin Grass, the father-and-son team then running Rite Aid, said it was a good time to buy, according to a January 13, , Business Week article.
The recession brought opportunities to acquire vulnerable companies, and Rite Aid bid for the bankrupt Revco D. Although the deal later fell through, Rite Aid had demonstrated its ability to move decisively and quickly.
This deal pushed Rite Aid's store count near the 3, mark. Beginning in Rite Aid opened 50 state-of-the-art drugstores in New York City, boosting the total to 67 within the city. Rite Aid planned to bring more stores into all of New York's boroughs later in the decade. From these two purchases emerged the subsidiary Eagle Managed Care Corp.
In October, 20 stores in Maine were bought from Brooks Pharmacy. By midyear Rite Aid appeared well positioned. Rite Aid set out to open, renovate, or expand 1, more stores over a three-year period. In Rite Aid continued to restructure its business to operate larger, higher-volume, and more profitable drugstores. Rite Aid, already the largest drugstore operator in the state, entered Louisville with a major share of the market.
At the same time, the company divested operations in certain areas where its market share was weak. During Rite Aid sold 37 drugstores and the assets of 72 more stores in Florida, as well as 33 drugstores and the assets of 21 others located in Massachusetts and Rhode Island. In October the company reached an agreement to sell stores in North and South Carolina to J. Penney Company, Inc.
In November the company entered into a joint venture to provide mail-order pharmacy services with Smith Kline Beecham's Diversified Pharmaceutical Services, a leading pharmacy benefit manager. This move was seen as another channel of distribution to offer prescriptions to select managed care customers.
Revco was subsequently acquired by CVS Corporation in Thrifty was the largest chain drugstore operator in California, Oregon, Washington, and Idaho. In addition, in Rite Aid opened new, 10,square-foot prototype stores, which seemed to pay off. The new format placed a greater emphasis on so-called front-end merchandise i. The siting of the new stores reflected an evolving emphasis on freestanding outlets over those located within strip shopping centers.
Many of the acquired stores were older, outdated stores, sorely in need of a remodeling. The company began a multiyear process of converting the units to the Rite Aid format. Some were expanded, while others were relocated--often shifting from a strip mall to a freestanding locale.
In addition, Rite Aid opened a number of its new prototype stores; the chain wished to continue growing, but there were few opportunities left for large acquisitions.
PCS was a leading pharmacy benefits manager, or PBM, involved in handling the administrative, paperwork side of prescription-drug services for health maintenance organizations HMOs and large employers and attempting to secure lower overall drug costs for them. GNC , a leading retailer of specialty vitamins and supplements. In July, the company allied with drugstore. During these same months of , however, Rite Aid was simultaneously in the process of going seriously off-track.
Investigations conducted by Business Week magazine and the Wall Street Journal began delving into allegations of dealings between Rite Aid and companies whose owners included members of the Grass family--dealings that the company had not disclosed. The company soon launched an internal investigation, which indeed uncovered undisclosed holdings in Rite Aid suppliers by Grass family members. In March, Rite Aid announced that its fiscal fourth quarter earnings would fall far short of expectations, sending its stock plunging 39 percent.
Shareholder lawsuits were soon filed. Late that month, Rite Aid faced a huge debt payment that it was not going to be able to make. The company's bankers agreed to a one-year extension of the credit, but not before forcing the ouster of Martin Green. After a short period of interim leadership, Robert G. Miller brought with him three other former Fred Meyer executives, including Mary F. Sammons, who was named president and chief operating officer. Miller and company quickly brought Rite Aid's store expansion program to a halt and launched a rigorous review of the existing store portfolio, targeting underperforming units for closure.
In alone, stores were shuttered. Sammons also slashed prices on Rite Aid's 1, top-selling products by 20 percent to get customers back into the stores and worked with vendors to repair supply-chain problems. The deal closed in October Meanwhile, litigation connected to the accounting scandal and the former managers of Rite Aid proliferated.
While Miller said, "This is a major step in putting the past behind us," several former top Rite Aid officials still had to contend with the legal consequences of their past actions, as formal investigations had been launched by the Securities and Exchange Commission SEC and federal prosecutors.
In June a federal grand jury in Pennsylvania issued a count indictment, charging Martin Grass and three other former Rite Aid executives with masterminding an illegal accounting scheme. One year later, on the eve of his trial, Grass pleaded guilty to conspiracy to defraud and conspiracy to obstruct justice. He faced as many as eight years in prison.
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