Walgreens and CVS Closing 2,100+ Stores While Rite Aid Ceases Operations

The three largest pharmacy chains in America are simultaneously shrinking. Walgreens announced plans to close 500 locations in 2025 and another 700 over the following two years. CVS closed 900 stores between 2022 and 2024 and plans to close 235 more by the end of 2025. Rite Aid, after a second bankruptcy filing, has ceased operations entirely. Combined, this represents the elimination of over 2,100 pharmacy locations by the country's largest chains -- and these are in addition to the thousands of independent pharmacies that have already closed. The chain pharmacy closures hit differently than independent closures because chains were supposed to be the resilient backbone of medication access. When an independent pharmacy closes, the conventional wisdom has been that a chain will fill the gap. But when the chains themselves are contracting, there is no backstop. Communities that already lost their independent pharmacies to chain competition in the 2000s and 2010s are now losing the chains too, leaving them with nothing. These closures are driven by a combination of factors that make the retail pharmacy model increasingly unviable. Declining prescription reimbursements from PBMs, competition from mail-order and Amazon Pharmacy, rising labor costs, increased shoplifting, and the end of COVID-era vaccination and testing revenue have all squeezed margins. Walgreens reported operating losses of $6.2 billion in fiscal 2024. The pharmacies that remain open are understaffed, with reduced hours, longer wait times, and higher error rates. This problem persists because the retail pharmacy is caught in a structural vise: PBMs squeeze reimbursement from above while operating costs rise from below. Mail-order captures the profitable, high-volume maintenance medications, leaving brick-and-mortar pharmacies with the complex, low-margin prescriptions. The business model that sustained pharmacy chains for decades -- using front-of-store retail sales to subsidize pharmacy operations -- has been gutted by e-commerce. No amount of operational efficiency can fix a model where revenue per prescription is below the cost of dispensing.