Rite Aid to fight lawsuits with bankruptcy

Rite Aid is poised to file for bankruptcy protection in the coming weeks — a move in part triggered by an onslaught of lawsuits brought against the drugstore chain alleging it knowingly filled unlawful prescriptions for controlled substances, including opioids, according to a new report.

The Chapter 11 filing would cover Rite Aid’s more than $3.3 billion debt load and pending legal allegations that it oversupplied prescription painkillers — ultimately contributing to the nationwide opioid crisis, the Wall Street Journal reported.

Rite Aid is currently facing more than a thousand federal and state-level, lawsuits as well as a civil suit filed by the Department of Justice back in March. It accuses the drugstore chain of violating the False Claims Act and Controlled Substances Act, specifically pointing to the filling of prescriptions despite obvious

“red flags” indicating they were “unlawful.”

“The present opioid epidemic is a national public health emergency,” the complaint states, noting that thousands of people across the United States have died from drug overdoses in the last decade.

According to the CDC, some 900,000 people have suffered fatal overdoses since 1999, with opioids playing an oversized role.

The bankruptcy filing would allow Rite Aid to pause on all of its legal proceedings and potentially resolve them in a single forum.

The company reported a revenue decline of 6% last quarter when compared to a similar period last year. Its net loss spiked to $307 million, which is nearly triple what it was the year prior, according to a securities filing reviewed by the Wall Street Journal.

With more than 2,330 stores in 17 states, Rite Aid is much smaller than counterparts like Walgreens, Boots Alliance and CVS Health, both of which have also been named in opioid lawsuits.