The need for pharmacy innovation is growing

In a land of giants, where the once corner pharmacy is all but extinct, the fate of Rite Aid hangs in the balance, and perhaps the future of pharmacies as we know them now.

Among pure-play drugstore chains, Rite Aid started the week as a distant third player behind Walgreens and category leader CVS, but after a sharp drop in Wall Street ended the week with a to single digits and a market value that fell below $400 million with an “M.”

This after Deutsche Bank analyst George Hill slashed his share price target to $1 and questioned whether the Pennsylvania-based operator of 2,450 stores might even exist.

“Unfortunately, we believe COVID has accelerated the decline of the retail pharmacy segment and we see the potential for a dramatic negative inflection point for Rite Aid,” Hill wrote, saying the outlook for the current fiscal year of society “seem inaccessible”.

Those comments precipitated a more than 20% drop in stock and compounded the retailer’s 12-month drop to more than 60%.

Although Rite Aid has not commented on the downgrade or subsequent sale, it is set to release its latest quarterly results and meet with investors. next Thursday (April 14) where he will likely have to deal with his current situation.

Difficult cases

While Rite Aid faces its own set of challenges, it’s not alone. A week ago, after projecting a downturn in COVID-fueled business that carried the industry for two years, Walgreens Boots Alliance was hit with its own set of downgrades and derision, in part due to its failure to making a decision on what to do with its European Boots unit, along with concerns that the Chicago-based operator of 13,000 sites in the US, Europe and Latin America lacked focus.

“Despite a long-term positive bias, the WBA is simply too complicated at this time,” Robert W. Baird analyst Eric Coldwell said in a note to clients. explaining his downgrade from stock.

Walgreens CEO Rosalind Brewer assured investors and analysts the company is moving forward with post-COVID plans that will reshape the business, from storefront to pharmacy, online and offsite.

“We are transforming and aligning the core business and building a pharmacy of the future that will enable and support our healthcare strategy,” Brewer said. “We are building a technology-enabled healthcare solutions platform with the consumer in mind that is well positioned to fuel our next phase of growth.”

For its part, CVS also operates a combination of businesses in three distinct categories (healthcare benefits, pharmacy services and retail) and has announced its intention to reduce its number of stores and reduce the density of its 9 900 locations by approximately 10% over the next two years. . The Rhode Island-based company, whose $140 billion market value is 3.5 times that of Walgreens, is expected to report first-quarter results the first week of May.

Further complicating the fight for the hearts and minds of consumers is the fact that several non-essential players, such as Walmart and Kroger, already hold a large share of the market they are actively seeking to expand.

While price and convenience are a major determinant of consumer and location loyalty and how they fill and refill their prescriptions, there is clearly room for further innovation to find new ways and places. to provide consumers with the medicines and care they need, and allow them to pay for it.

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NEW PYMNTS DATA: WHY PATIENT PORTALS ARE BECOME TABLE TOPS FOR CONSUMERS

On: Patient portals have become a must-have for providers, so much so that 61% of patients interested in using the tools say they would choose a provider that offers one. For Accessing Healthcare: Easing Digital Frictions In The Patient Journey, a collaboration between PYMNTS and Experian Health, PYMNTS surveyed 2,333 consumers to learn how healthcare providers can ease digital pain points to improve care and satisfaction. patients.

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