Rite Aid Bankruptcy Speculation

[veteran+]

"The only real sticking point I see if the creditors are already in agreements is the opiate lawsuit which then puts the government in a ugly position; how bad would it look if the government forced the company out of business to pay them a judgment? I highly doubt that they want the headlines nationwide that they caused tens of thousands of job losses and such."

Perhaps, but would it be worse than not trying to get compensation to the families that lost someone due to the reckless Opiod thing?

[SamSpade]

Actually, if you have already made agreements with all of your creditors then you control your destiny. The problem is when companies file with angry creditors who weren't part of the discussion, and they basically say we can only pay 2 cents on the dollar and would like to walk out debt free. Meanwhile they have enough money to run the company for like 47 days because they couldn't round up adequate DIP funding either and they run out... That's when the creditors wind up being able to take over and force the liquidation of the company to pay themselves back. The creditors here don't want that apparently. The only real sticking point I see if the creditors are already in agreements is the opiate lawsuit which then puts the government in a ugly position; how bad would it look if the government forced the company out of business to pay them a judgment? I highly doubt that they want the headlines nationwide that they caused tens of thousands of job losses and such.

This is a valid point. The company I work for had been pressuring their primary lender/creditor to refinance based on others in our industry receiving better deals out of packaged bankruptcies for a few years ahead of ours. Then, when they continued to refuse, a pre-pack chapter 11 was filed. The first lender pleaded with the court that it was unfair to them, but the secondary and third in line lenders were already open to and agreeable to stepping in and taking over the company.

While our industry is in a lurch right now so 2023 financials aren't rosy, I can assure you that things are weirdly better after the bankruptcy than they were for the few years ahead of it.

[BillyGr]

Perhaps, but would it be worse than not trying to get compensation to the families that lost someone due to the reckless Opioid thing?

I guess the question is, what did any of the pharmacies actually do that was incorrect?

If someone brought them prescriptions for these medicines that were legitimate, and they filled them, there is nothing being done wrong.

They have no way to know what else the person is getting from someplace else (since there weren't any centralized spots to compare prescriptions from Rite Aid vs. CVS vs. Walmart etc.).

And even if the person is getting more than one at the same store, that could very well be intended by someone who they are seeing.

After all, some people do, in fact, have issues that cause serious and long-term pain and actually need something to help them be able to live and function at best they can.

[ClownLoach]

"The only real sticking point I see if the creditors are already in agreements is the opiate lawsuit which then puts the government in a ugly position; how bad would it look if the government forced the company out of business to pay them a judgment? I highly doubt that they want the headlines nationwide that they caused tens of thousands of job losses and such."

Perhaps, but would it be worse than not trying to get compensation to the families that lost someone due to the reckless Opiod thing?

And do you actually believe one penny would go to anyone other than the lawyers and the government?

[ClownLoach]

Perhaps, but would it be worse than not trying to get compensation to the families that lost someone due to the reckless Opioid thing?

I guess the question is, what did any of the pharmacies actually do that was incorrect?

If someone brought them prescriptions for these medicines that were legitimate, and they filled them, there is nothing being done wrong.

They have no way to know what else the person is getting from someplace else (since there weren't any centralized spots to compare prescriptions from Rite Aid vs. CVS vs. Walmart etc.).

And even if the person is getting more than one at the same store, that could very well be intended by someone who they are seeing.

After all, some people do, in fact, have issues that cause serious and long-term pain and actually need something to help them be able to live and function at best they can.

So far these opioid pharmacy suits have been settled by the big guys like CVS who can afford to just throw away the money because they are so incredibly massive that billions of dollars spent now is better for their own stock buybacks than uncertainty while they do the right thing and fight the case. I argue that they didn't do what is right for their shareholders here; they should have fought the expense because as stated above they're not the doctor ordering the prescription but rather the pharmacy that is responsible for filling all valid orders without discrimination. The responsibility of the pharmacy is to clarify potential problems with the doctor if they feel the prescription isn't valid or there is a clerical/math error (script for 2 pills 2x a day for 30 days qty 60 - do you see an error there?). The doctor either affirms or corrects but then the pharmacy is responsible for filling the prescription. Aside from recent litigation around the responsibility for a pharmacist claiming religious objection to dispensing abortion pills, I am not sure exactly how the pharmacy is liable for the doctor's reckless prescription of these drugs. The pharmacy doesn't approve them either, the FDA does so if they shouldn't have been on the market then the FDA should have ordered them removed. If the intent is to claw back alleged profits from the sale of these problem drugs once again I find it difficult to believe that the pharmacies wouldn't have also been in trouble for refusing to fill FDA approved drugs even though they were in question (outside of the previously discussed religious objections which don't apply to opiates). In short, if someone had deep enough pockets to fight this to the Supreme Court I'm not sure that judgments against pharmacies hold up. The drugmakers? Sure, they knew what they were doing and should be responsible for cleaning up the mess they've made and paying for addiction treatments etc. But this is otherwise blaming the store for things out of their control. When the Firestone tires wore out prematurely on the Ford SUVs that were rolling over did anyone sue the dealerships over the bad tire design and demand to claw back the profits from the sale of the cars? (Someone probably tried but would the case actually hold water? Probably not).

At this point it's two groups. The big guys like CVS, Walmart, etc. that pay multi billion dollar verdicts out of petty cash as an annoyance even though they have the deep pockets needed to push these vastly complicated cases through the courts to attempt to be vindicated, and then the small guys like Rite Aid and other small pharmacies that don't have the resources to fight off the charges and can only afford to discharge them with a bankruptcy. That doesn't seem fair or just for anyone, and worse as these lawyers get richer and place orders for additional Bentleys and Ferraris the costs of these judgments get passed directly to those who can least afford it.

[veteran+]

"The only real sticking point I see if the creditors are already in agreements is the opiate lawsuit which then puts the government in a ugly position; how bad would it look if the government forced the company out of business to pay them a judgment? I highly doubt that they want the headlines nationwide that they caused tens of thousands of job losses and such."

Perhaps, but would it be worse than not trying to get compensation to the families that lost someone due to the reckless Opiod thing?

And do you actually believe one penny would go to anyone other than the lawyers and the government?

[storewanderer]

If the vaccine scheduler is accurate to predict closures then the following...

Santa Clara, CA has no future vaccine appointments available
Cupertino, CA has none either
Sacramento Fulton has none after today
Citrus Heights Sunrise has none after 10/31

[Romr123]

Looking in Detroit/SE Michigan from my home address--78 locations within 25 miles; the 10 locations w/in 5 miles all open and scheduling.

Flint, MI which is relatively overstored and has seen at least one closure....30 locations within 25 miles.

Looks like Woodsville, NH closed. Had stopped there this summer. 2 locations remaining within 25 miles.

[mbz321]

Here's a lengthy list of leases they want to reject (scroll down a bit). Some of these locations haven't been a Rite Aid for a decade+!
https://restructuring.ra.kroll.com/Rite ... A==&id2=-1

[storewanderer]

Here's a lengthy list of leases they want to reject (scroll down a bit). Some of these locations haven't been a Rite Aid for a decade+!
https://restructuring.ra.kroll.com/Rite ... A==&id2=-1

Many of these appear to be subleased, but also a lot of the very recent closures are on that list.