Walgreens private equity takeover may bring layoffs, pharmacy closures, experts warn

Walgreens has completed a deal to be bought by private equity firm Sycamore Partners, and pharmacy experts are worried it’ll bring with it layoffs and pharmacy closures.

Rumors of the takeover began swirling last December, and Walgreens executives confirmed in March they had signed a definitive agreement with Sycamore. As part of the deal, Walgreens and its subsidiaries are to be split into five separate, privately owned companies: retail pharmacy chain Walgreens, pharmaceutical wholesaler the Boots Group, specialty pharmacy company Shields Health Solutions, post-acute care company CareCentrix, and primary care clinic chain VillageMD.

Under Sycamore’s ownership, Walgreens will be led by CEO Mike Motz, who previously worked as CEO of Staples US Retail, a company the private equity firm acquired in 2017. Former Walgreens CEO Tim Wentworth will continue to serve as a director, company execs said in an Aug. 28 press release.

Industry reactions. Shane Jerominski, co-founder of the Pharmacy Guild, a pharmacy workers union formed in late 2023 that represents employees at some Walgreens and CVS locations, told Healthcare Brew in an emailed statement the deal “raises serious concerns for pharmacy professionals and the patients we serve.”

“When private equity firms take over, patients and communities are too often left paying the price through store closures, reduced staffing, and prescription errors—all of which jeopardize safe patient care,” Jerominski said, also highlighting that Sycamore has no background in healthcare or retail pharmacy.

Sycamore’s restructuring of Walgreens “must not come at the expense of patient safety or the dignity of the professionals who keep our pharmacies running,” Jerominski added.

Cherokee Layson-Wolf, a professor in the department of practice, sciences, and health outcomes research at the University of Maryland School of Pharmacy, told Healthcare Brew her biggest concern is how the deal will affect patient access to pharmacies.

For example, Sycamore may choose to consolidate pharmacy locations and rely more on central fill locations, Layson-Wolf said, which are facilities that fill and transfer prescriptions to pharmacies.

Walgreens has 11 such locations—the company calls them micro-fulfillment centers—that send prescriptions to more than 4,500 stores, Wentworth said in the company’s Q1 2025 earnings call in January. At the time, Wentworth said he wanted to get that closer to 6,000 stores this year.

More central fill locations could mean fewer pharmacies, which may affect patients’ ability to see their pharmacist, Layson-Wolf said.

In a statement released following the announcement, Jim Baker, executive director of nonprofit Private Equity Stakeholder Project (PESP), said the deal puts “patients, workers, and entire communities at risk” because of Sycamore’s record of bankruptcies, layoffs, and cost cutting, which could lead to fewer pharmacies and “thousands of workers” losing their jobs.

Walgreens has already announced plans to close 1,200 stores, and PESP warned “store closures could accelerate under Sycamore Partners’s ownership,” adding closures tend to “disproportionately impact low-income, rural, and minority communities and can create ‘pharmacy deserts’ where patients lose access to essential medicines and services,” according to the statement.

Since Sycamore acquired Staples, the company has shut nearly one-third of its stores in the US, according to PESP. If the same number of Walgreens stores close, that would mean more than 70,000 layoffs, the nonprofit estimated.

Walgreens already announced a number of layoffs in 2024, including 145 “mostly corporate” employees in January, 646 employees in March, an undisclosed number of roles in April, and 256 employees in December, we previously reported.

Healthcare Brew reached out to both Walgreens and Sycamore Partners for comment on the potential for layoffs or store closures, but did not hear back by publication.