The slow simmer of mistakes and misfortunes has come to a boil for the biggest U.S. drugstore chains. They've accumulated too many stores at a time of changing shopper habits. They're saddled with numerous government fines and a particularly ailing relationship with health insurers.
Novartis has lost a bid to keep a generic version of its top-selling heart failure drug Entresto off the U.S. market by blocking regulators from approving it, though the generic's launch faces other legal roadblocks. U.S. District Judge Dabney Friedrich in Washington, D.C., in an order made public this week, says the FDA did not overstep its authority in approving MSN Pharmaceutical's generic of Entresto, despite a slightly different label and alleged differences between the drugs.
CVS is closing 900 stores. Rite-Aid is closing 500. Walgreens announced Tuesday it plans to close 1,200 stores, meaning 1 in 7 will disappear. What is going on with America's drug stores? Walgreens and other chains overexpanded during the 1990s and 2000s to drive out competitors and draw more customers. They are now shutting down because of shifting consumer habits, competition and changes in the pharmacy industry. Around 25% of Walgreens' stores aren't profitable, CEO Tim Wentworth says, and the chain will look to close stores that are right by one another or struggling to hold down theft. Walgreens and other retailers say they have been hit by shoplifting since the pandemic, and resorted to locking up items or closing high-theft stores. But shoplifting alone doesn't explain Walgreens' problems, and the company subsequently admitted last year it 'cried too much' over the impact of the would-be scourge.
The FDA has agreed to reconsider a decision it made last month to bar drug compounders from selling their own versions of Eli Lilly's blockbuster weight loss and diabetes drugs. The agency said in a court filing it would now allow compounding pharmacies and facilities to keep providing the drugs while it reviews whether there is a shortage of their active ingredient. The compounding versions of the drugs are cheaper for patients than the brand-name versions.
CVS Health is exiting its core infusion services business and plans to either close or sell 29 related regional pharmacies in the coming months. Details of the strategic shift were announced in a CVS corporate memo dated Oct. 8 and seen by Reuters. The company on Oct. 8 stopped taking new patients seeking antibiotics, drugs supporting muscular health, and intravenous nutrition services. CVS bought Coram LLC, a drug infusion services provider, for $2.1 billion in 2013.
Teva Pharmaceutical Industries Ltd. has agreed to pay $450 million to resolve allegations it used charities that help cover Medicare patients' out-of-pocket drug costs as a means to pay kickbacks to boost sales of its multiple sclerosis drug Copaxone and conspired to fix prices for generic drugs. The two settlements announced by DOJ on Thursday included one for $425 million resolving a lawsuit filed in federal court in Boston in 2020 as part of an industry-wide probe of drugmakers' financial support of patient assistance charities.