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Retail Pharmacies

Maia Anderson

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

 last December, and Walgreens executives 

 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.

Shane Jerominski, co-founder of the Pharmacy Guild, a pharmacy workers union 

 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 

, and cost cutting, which could lead to fewer pharmacies and “thousands of workers” losing their jobs.

 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 ‘

’ 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.

 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. 

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

Some worry private equity’s business model may jeopardize patient access to pharmacies. 

Cassie McGrath

Ken Bertini, pet medication compounding specialist at Sear’s Pharmacy in Oak Park just outside Chicago, has worked in retail pharmacy since 1965. He spent most of his career at Segreti Pharmacy, also in Oak Park, but moved to Sears after Segreti closed this January due to rising rents.

When he was starting out, Bertini wrote labels on a typewriter. Now, he not only uses a computer for that work but also took up new skills to stay strong in the evolving industry, including compounding, or making tailored medications for patients and pets.

“There’s not too many pharmacists around as long as I’ve been around,” Bertini said. “I remember way back when—when things were profitable, things were fun in the pharmacy—but now it’s very stressful. You don’t turn out numbers, you’re not going to survive.”

The pharmacy industry has grown significantly in recent years, up from about 

 last year showed 1 in 3 retail pharmacies closed between 2010 and 2021, suggesting there’s increasing pressure to compete with the big names like CVS, Walmart, and Walgreens.

Healthcare Brew spoke with Bertini and Jim Schniepp, clinical pharmacy specialist at Rush University Medical Center in Chicago and pharmacist for 40 years, about how the industry has changed.

Both pharmacists began their careers before digital tools like electronic health records existed.

While retail pharmacists focus more on dispensing medications to patients in settings where they can also buy household items like toilet paper or over-the-counter meds, hospital pharmacists provide treatments for patients in hospitals.

Bertini said “technology is probably the biggest change for pharmacists” and computerization made it easier to store data, track a patient’s medication usage, and remind them of refills. When someone orders potassium, for example, Schniepp said he can pull up a patient’s labs and look for more information about the order.

Tech is everywhere in pharmacy settings (like all of healthcare) these days. Between 2003 and 2016, the amount of hospitals with computer prescriber systems grew from 2.5% to 95.6%, according to a 2018 

. And tools like barcode scanners that can digitally verify the safety and accuracy of a drug have grown in use from 5.7% in 2002 to 61.7% by 2017.

“You know in real time more of what’s going on,” Schniepp said.

Rush also uses Pyxis machines that automatically dispense medications now, he added, compared to having to use floor stock and medication carts before.

Schniepp said the problem is if technology fails—like 

 during a cardiac arrest—because pharmacies are extremely reliant upon it. (Though one could argue that’s the case for just about every industry.)

Technology, Bertini said, also changed the roles of pharmacists, who went from putting pills in bottles to receiving doctoral-level education (PharmDs, or doctors of pharmacy), which takes roughly four to six years to complete. However, the industry is still facing 

, and only 13,323 new pharmacists graduated in 2022, down from 14,223 the year prior, according to the American Association of Colleges of Pharmacy.

When Schniepp was fresh out of school, he said his job was mostly distributive and much less clinical. But in the last 20 years, he said the staff has grown “exponentially” and pharmacists are now assigned to different departments like ICU, pediatrics, and surgery.

“The skill level of the pharmacist has increased. Almost all of our pharmacists have done residencies,” he said.

Now, compared to when he first started, pharmacists also approve all medications, compared to that being solely a doctor’s purview in 2000. He and other hospital pharmacists speak with providers about what patients should take and which meds need to be changed to better their care.

“It’s not like I’m in the basement filling drugs,” Schniepp said. “In fact, I don’t see drugs very often, which people are surprised to hear.”

One of the downsides of technology, Bertini said, is it has increased the control of payers and 

Payers and PBMs now have control over “what we could dispense, how much we could dispense, to whom we could dispense, how much they were going to reimburse us for it,” he said. Before PBMs’ rise in influence, there were more direct relationships between drug manufacturers and pharmacies, and pharmacies made more money this way.

Though competition with corporations like CVS and Walgreens has grown over the years—CVS went from operating 5,471 stores in 2005 to 9,135 stores in 2024, for instance—the big competition, he said, is not with other pharmacy chains. It’s with the PBMs.

“We actually are losing money,” Bertini said, due to low reimbursement rates for medications, which make up a significant portion of pharmacies’ revenues. “How can you survive? You can’t.”

On top of that, corporate pharmacy jobs have become “very stressful,” he said.

“[Pharmacists are] not getting enough time, enough information, and…it’s not the pharmacists’ fault. The corporates don’t put the pharmacists that they hire in a position to do [vaccinations and additional tasks]. They have quotas,” he said.

In the early days of his career, Bertini said there was an independent pharmacy on every corner. What were once competitive relationships with other independent pharmacies has turned into collaborative ones. Now, there are 

But at the end of the day, Bertini said, the “personal contact” provided by independent stores remains important and strong.

“If you read the reviews about this store, people just love it—they don’t want to go anywhere else. There are chains all over the place,” he said, “but when you give people personal service, that’s really what they need and that’s what they like.”

Look back at the last 25 years in the pharmacy industry

Long-time pharmacists share how retail and hospital pharmacy has changed since the turn of the century.  

Chain drug stores like CVS and Walgreens no longer rank No. 1 on the pharmacy popularity list.

Patients increasingly prefer mail-order, digital, and supermarket pharmacies, according to consumer insights advisory firm JD Power’s 2025 US Pharmacy Study released July 29.

The study, conducted from May 2024 to May 2025, included responses from 14,700 pharmacy customers who had filled a prescription within the last 12 months.

The increasing satisfaction with alternatives to chain drug stores “helps set the stage for a tipping point in the pharmacy space,” Christopher Lis, managing director of JD Power’s global healthcare practice, said in a statement.

According to the study, supermarkets like New York-based Wegmans and Florida-based Publix and mass market retailers like Costco and Sam’s Club are outperforming chain drugstores when it comes to staffing levels, patients’ trust in their pharmacist, and how quickly they fill prescriptions.

Mail-order pharmacies, on the other hand, are growing in popularity, thanks to digital features like apps, websites, and texts—and they save patients time and money, according to the survey.

But despite digital pharmacies becoming more popular, most companies have pretty low brand recognition, JD Power found. The results show only 67% of pharmacy customers knew about digital pharmacy brands, and while 58% of that pool said they were “aware of” Amazon Pharmacy, other brands were not recognized widely.

Health Mart ranked No. 1 in satisfaction scores for brick-and-mortar chain drug store pharmacies, with Good Neighbor Pharmacy coming in second.

Sam’s Club came in first place for mass merchandiser pharmacies, and Costco came in second.

Wegmans took first place for supermarket pharmacies, with Publix ranking second.

PillPack by Amazon Pharmacy took first for mail-order/digital pharmacy, with Kaiser Permanente Pharmacy taking second.

Asian woman reading the ingredient label while shopping for multivitamin and health supplements on shelf in supermarket.

Patients increasingly prefer digital, supermarket pharmacies over chain drug stores

We know being popular isn’t everything, but… 

Another day, another example of CVS not beating the vertical integration 

Earlier this month, Aetna enacted a new policy for its commercial medical plans mandating drugs be supplied by third-party specialty pharmacies under CVS, the health plan’s parent company, and shipped directly to suppliers. Previously, these facilities have purchased drugs for patients independently and billed for them under a health plan’s medical benefit.

The policy, effective as of July 1, is a sign of vertical integration and puts infusion centers in a difficult financial position that could eventually lead to their closure, experts told Healthcare Brew.

Now, five drugs treating conditions like multiple sclerosis, uncontrolled asthma, and rheumatoid arthritis for Aetna patients are covered under a pharmacy benefit, meaning they will be delivered from a CVS specialty pharmacy.

An easy way to understand the challenges for infusion centers is comparing it to if customers brought their own steak to a restaurant and asked a chef to cook it, Robert Gelfand, founder and president of New York treatment facility American Infusion Centers, told us.

“Part of the business model we operate on is being able to buy the medication and bill for it,” Joshua Katz, director of Massachusetts-based medical clinic the Elliot Lewis Center, said. “If the specialty pharmacy buys the drug and bills for it, that eliminates that source of revenue for us. It’s hard to be profitable.”

Gelfand said his center runs on “relatively modest profits” and policies where a company yields higher returns on a few drugs (which can turn into more and more over time) like this are “insidious.”

 found clinics could lose out on nearly $2,000 per month if their drugs are delivered via an insurance company (aka “bagging”) rather than when they directly purchase the drugs. The study showed on average a $300+ per month rise in out-of-pocket payments for patients under the bagging method as well.

Right now, CVS is in the spotlight, but Gelfand is worried this kind of policy could spread to other drugs or payers. If it does, his business may no longer be able to sustain itself, he said, and may even be at risk of closure.

He may need to stop taking Aetna patients due to these financial challenges, Gelfand added.

Working with specialty pharmacies is also a “big administrative burden” on infusion centers, Katz said, as it requires phone calls, benefits verification, and shipment coordination. Without specialty pharmacies, the infusion centers can simply order drugs on their own.

If there’s a problem with drug temperatures or a drug is contaminated during shipment, or if a delivery is sent to the wrong address, the infusion center isn’t allowed to substitute a medication with another drug they have on hand, Elliott Warren, executive director of advocacy group Infusion Providers Alliance, said.

Considering that many patients at infusion centers have serious illnesses, Warren said he’s worried quality of care will suffer.

“It’s another example of a big payer and insurance company standing between a physician and their patient, all for, frankly, their own self-interest,” he said.

The Infusion Providers Alliance was informed about the policy before it went into effect and 

 on June 12 to Aetna outlining the group’s concerns, highlighting potential patient care, cost, legal, and supply chain issues.

When asked about the reasons behind the new rule, CVS spokesperson Phil Blando told us in an emailed statement the policy will allow the pharmacy chain “to better control the cost of the drugs and keep premiums more affordable, while still providing members with safe, convenient access” to certain drugs.

In recent years, CVS, UnitedHealth, and Cigna have 

 the healthcare industry. Essentially, these top three companies, which control 80% of the prescription medicine market, can set the cost of drugs while also operating the pharmacies that dispense them.

The infusion center leaders said this new Aetna policy is another practice in which CVS is pushing business into its own specialty pharmacy arm through beneficiaries covered under its health plan.

“It’s a theoretical death knell for infusion centers,” Glefand said.

Aetna’s new specialty drug policy ‘insidious’ for infusion centers, one leader says

Infusion center leaders accuse CVS of trying to funnel business back into itself. 

Nicole Ortiz

When you think “healthcare,” the first place your mind probably goes is Best Buy, right?

No? Well, perhaps that’s a good thing, seeing as it recently divested from its hospital-at-home offering and restructured its health business.

In 2021, the tech retailer acquired the Current Health virtual care platform for roughly $400 million, and in 2023, it shared plans to 

 its healthcare services. But the company’s health arm struggled, recording a Q4 $475 million goodwill impairment charge, which contributed to a nearly 16% stock drop on March 4 and led to a 

 that included an announcement to lay off 161 employees, effective this September.

Current Health announced the split from Best Buy at the end of June. It will be reacquired by co-founder Christopher McGhee, who started the company in 2014, for an unspecified amount. According to a LinkedIn 

, Current Health treated 70,000+ patients during its time under the Best Buy umbrella and had partnerships with major health systems like New York-based Mount Sinai Health System and NYU Langone Health.

“Investors are becoming increasingly cautious about big-name retail companies expanding into healthcare,” David Hamlette, health and wellness analyst at market researcher Mintel, told us via email. “Investors are wary because the long-term profitability and sustainability of these healthcare ventures remain unclear, especially as retailers continue to experiment with digital strategies and partnerships.”

Best Buy and Current Health did not respond to requests for comment.

In general, this seems to follow a trend: Companies saw that healthcare and virtual care were experiencing a boom during and after the height of the 

 and wanted to find a way in, Lucienne Ide, founder and CEO of digital health company Rimidi, told Healthcare Brew.

“A bunch of people thought, ‘Oh, how hard is this? We do virtual business in all other sectors, we can jump in and do this in healthcare,’” she said. “And it’s just not the same.”

According to data from researcher eMarketer, retail health clinics saw the most growth in use (over 51%) compared to other nontraditional care venues between 2020 and 2021. And that was largely because these retailers could offer more convenience, better price transparency, and a customer service element, Ide said.

“These big guys didn’t fail because they had nothing to offer,” she added. “They had a whole lot to offer. They just didn’t have all of this equity that we have in healthcare.”

Now, we’re seeing these retailers divest from parts of their healthcare offerings or ending them altogether after the pandemic bubble burst.

If you’re feeling a sense of déjà vu, that’s because last April, Walmart made a similar move by ending its 

. Or perhaps you’re thinking of Walgreens, which has struggled to 

 its VillageMD primary care offering (which is still of interest for its 

, private equity firm Sycamore Partners).

“Divesting from underperforming healthcare assets is increasingly seen as a necessary move to address stakeholder concerns and adapt to market realities,” Hamlette said.

 related to these healthcare investments, retailer options also contribute to rising healthcare costs when patients receive “disjointed care” that results in “duplicate care, duplicate testing—a lot of inefficiency in the system,” Ide said.

“I don’t think anyone has cracked the nut on it,” she said.

Retailers like Best Buy are divesting from their healthcare offerings following stakeholder wariness

Once seen as an opportunity for growth, big-name retailers still aren’t seeing financial gains from acquisitions and investments.

Retailers like Best Buy are divesting from healthcare offerings following stakeholder wariness

 23 pharmacies in Arkansas after the state passed a law banning companies that own 

 (PBMs) from also operating pharmacies starting in 2026.

But CVS also has a lot of competition in the retail pharmacy space, including 

. Experts told Healthcare Brew CVS closures could open the door for other retailers to grow their footprints in the state.

“There’s definitely an opportunity for competitors broadly to capture some of the market share. But how much of an opportunity, I think, certainly depends on each specific bigger brand,” Rajiv Leventhal, senior analyst in digital health at research firm eMarketer, said.

 retail pharmacies closed across the US between 2010 and 2021 the Arkansas Democrat Gazette reported in May, 100 pharmacies have closed in the state since 2020.

, which keep reimbursement rates for medications lower than what pharmacy companies say they need to keep their doors open, Healthcare Brew previously reported.

CVS owns Caremark, one of the three largest PBMs in the US—alongside Cigna’s Express Scripts and UnitedHealth Group’s OptumRx (all of which also have a pharmacy or mail-order presence)—which help set the price for 80% of drugs in the country. CVS and Cigna are 

 Arkansas to overturn the law that calls to break up vertical integration among PBMs.

Now that CVS is reevaluating its presence in Arkansas, Amy Thibault, executive director of corporate communications for external affairs at CVS, told Healthcare Brew in an emailed statement that “23 CVS pharmacy locations in Arkansas are currently open and will continue to operate for the immediate future.” She added the company has not announced any store closures, and is “evaluating any and all options” to keep pharmacies open, including legal means.

Referencing the lawsuit CVS filed against the state, Thibault added that the law would “force CVS Health to stop pharmacy operations in the state” and that “an injunction would allow the 23 CVS Pharmacy locations in Arkansas to remain open and continue serving patients and customers while the court considers CVS Health’s arguments that the law violates the United States Constitution.”

Rohan Kulkarni, executive research leader for business consultancy HFS Research, said potential CVS closures could “give new life to independent pharmacies who have been dying a very, very slow and painful death for the last number of years.”

In a May statement, CVS said the law would also restrict consumers’ access to medications. But Kulkarni disagreed, saying smaller chains and mail-order pharmacies “will step up.” 

Walgreens is another CVS competitor, though the company has faced significant challenges in recent years, culminating in getting 

 by private equity firm Sycamore Partners back in March. Now, Walgreens is closing more of its stores (1,200 nationwide, to be exact) than opening them.

“Walgreens probably isn’t thinking about attracting quite as much in-person pharmacy market share as much as it is figuring out its own strategic path going forward. That said, Walgreens and Walmart are in a good position, if [expanding in Arkansas] was a priority for both of them,” Leventhal said.

That’s because Walgreens and Walmart are second and fifth, respectively, on the list of the 

 in the US, he said. CVS has more than 9,000 pharmacies nationwide, while Walgreens has about 8,500 and Walmart has more than 5,000 alongside its partnership with wholesale retailer Sam’s Club.

But unlike CVS, Walgreens and Walmart don’t also own a health plan and a PBM, Leventhal said, adding that the whole idea behind the law is to “remove or reduce some of the power of these vertically integrated conglomerates.”

Both companies already have more stores than CVS in Arkansas, too—hundreds of locations for both Walgreens and Walmart, the latter of which is also headquartered in Bentonville, Arkansas.

Walgreens, Walmart, and Amazon did not respond to requests for comment.

“Even though Walgreens is grappling with all its own store closures, there’s definitely an opportunity for it to capture some pharmacy market share,” Leventhal said.

There’s also space for Amazon to pull more customers, Leventhal said, as a digital pharmacy in the market. In October 2024, Amazon announced it would expand same-day medication delivery in 20 new cities in 2025, up from just 10, which 

 reported as an “aggressive expansion.”

“Amazon is carving into the share of retail pharmacy incumbents—a bit even before this law—and I think it has an opportunity to continue doing so,” he added. “As more pharmacies close, even as Walgreens stores close, that’s an opportunity for Amazon.”

The biggest impact to PBMs, Kulkarni said, could come if the Arkansas law spurred a nationwide movement among other states to regulate PBMs more (

 have already proposed their own PBM laws). Congress 

 any PBM legislation in the recently passed budget bill.

“That will probably hurt the Caremarks and the Optums and CVS more than what’s happening in Arkansas,” he said.

CVS is threatening to close stores in Arkansas, but that may open the door for competitors 

“There’s definitely an opportunity for competitors broadly to capture some of the market share,” one expert says. 

If you’re a fan of winter sports, you might be in luck…because we may have a snowball effect emerging.

It all started when Arkansas Governor Sarah Huckabee Sanders signed a law on April 16 saying any company that owns a 

 (PBM) would be prohibited from also owning or operating pharmacies in the state. That’s seemingly bad news for the 

 PBMs—Cigna Group’s Express Scripts, CVS’s Caremark, and UnitedHealth’s Optum Rx, which collectively control nearly 80% of the market—seeing as they all also operate pharmacy chains.

Now the state of Iowa wants to get in on the action, with Governor Kim Reynolds signing a law on June 11 to change how PBMs operate in the state.

The current practice, the Iowa governor wrote in a letter, gives PBMs “outsized power.outsized power over which medications patients receive and what they pay—often resulting in unaffordable drug costs, difficult choices for families, and reimbursement below pharmacy acquisition cost,” she wrote in a letter.

 Under the Iowa law, PBMs cannot stop patients from using certain in-network pharmacies. They also can’t reimburse their own pharmacies more for dispensing the same drugs and must adhere to current national average drug costs.

Further, rebates negotiated with drugmakers will need to “pass through” to health plan clients to ensure PBMs are sharing the savings and not just profiting from the arrangement, according to 

“We believe the legislation will result in higher costs for Iowa patients. By restricting the tools PBMs use to control costs, drug companies get even more of an advantage to increase profits and make health plans and patients pay more,” Pharmaceutical Care Management Association spokesperson Greg Lopes told us.

 As late as last week, Louisiana lawmakers were working through a proposal that would go into effect in 2027 to ban PBMs from owning pharmacies in the state. CVS reportedly later sent texts to customers claiming the legislation “threatens to close your CVS pharmacy,” according to 

On June 12, the state’s Senate killed the bill, though the governor could still call a special session.

 on May 29 against the state. CVS threatened to close its 23 retail pharmacies in the state, and Cigna said it would likely end up shuttering some stores.

In response to the Iowa law, CVS Caremark spokesperson Phillip Blando told us the PBM “is committed to making affordable, high-quality pharmacy benefits available to Iowa employers and consumers” and the company believes the law allows it to “coordinate pharmacy services to contribute to lower prescription drug costs and better outcomes.”

Express Scripts and Optum Rx did not immediately respond to a request for comment.

High Cost of Prescription Drugs: Concept prescription bottles with gavel