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Tag: pharmacies and pharmacists

  • Rite Aid files for bankruptcy | CNN Business

    Rite Aid files for bankruptcy | CNN Business

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    New York
    CNN
     — 

    Rite Aid filed for Chapter 11 bankruptcy protection Sunday, a casualty of a miserable environment for drug stores, exacerbated by its runner-up status to bigger chains and expensive legal battles for allegedly filling unlawful opioid prescriptions.

    The bankruptcy was not a surprise. Its bigger rivals, CVS and Walgreens, are also facing many of the same problems. They, too, are closing stores as Amazon and big-box chains like Walmart, Target and Costco serve as more customer-friendly alternatives to nationwide pharmacy chains.

    But Rite Aid is in much worse financial shape than its competitors and unable to weather the storm that has been beating down on the industry. On Thursday, it filed a notice to the US Securities and Exchange Commission saying it would be unable to file its latest quarterly financial report because it was looking at “strategic alternatives,” which is Wall Street speak for “considering bankruptcy.”

    In that filing, the company said it expected its losses would increase significantly in the past quarter, which is saying something, considering it lost about three quarters of a billion dollars between March 2022 and March 2023 — and another $307 billion between March and May this year. Over the past six years, Rite Aid has tallied nearly $3 billion in losses.

    At the beginning of June, the last time the company filed a financial report, Rite Aid had just $135.5 million of cash on hand -— and $3.3 billion in long-term debt, which exceeded the value of the company’s assets by nearly $1 billion. With rising interest rates, that debt wasn’t cheap to finance.

    “It was always a matter of when, not if, Rite Aid would file for bankruptcy,” said Neil Saunders, managing director of GlobalData, in a note to investors. “The company has been deep in the red for the past six years.”

    The company said in a statement it had secured $3.5 billion in financing and debt reduction agreements from lenders to keep the company afloat through its bankruptcy.

    It said it would accelerate its pace of store closures and sell off some of its businesses, including prescription benefit provider Elixir Solutions. Bankruptcy could also help resolve the company’s legal disputes at a vastly reduced cost.

    As part of the bankruptcy plan, Rite Aid appointed a new CEO, Jeff Stein, who will also serve as the head of restructuring and a board member. Stein, in the statement, said the company plans to remain in business.

    “With the support of our lenders, we look forward to strengthening our financial foundation, advancing our transformation initiatives and accelerating the execution of our turnaround strategy,” he said. “In doing so, we will be even better able to deliver the healthcare products and services our customers and their families rely on -— now and into the future.”

    Rite Aid has had an interim CEO since January 2023.

    Rite Aid’s losing battle against mounting debt was exacerbated by its legal troubles stemming from accusations of filing unlawful opioid prescriptions for customers.

    The Department of Justice filed suit against the company in March, claiming that it knowingly processed “unlawful prescriptions for controlled substances.” That stands in violation of the False Claims Act and Controlled Substances Act. The government accused Rite Aid of missing “obvious red flags” when it filled the prescriptions for addictive pain killers.

    When the US Justice Department filed its lawsuit, Attorney General Merrick Garland said the department would use “every tool at our disposal” to hold Rite Aid accountable for contributing to the opioid epidemic.”

    Walgreens, CVS and others settled similar lawsuits over the past few years, but they remain in better financial shape and were largely able to weather the tens of billions of dollars owed to various government agencies in settlements.

    More than half a million people have died from drug overdoses in the United States between 1999 and 2020, according to the US Centers for Disease Control and Prevention.

    Rite Aid is a distant third-largest nationwide standalone pharmacy chain in the United States — and the seventh largest pharmacy overall, when taking into account big box chains. It has more than 2,200 stores in 17 states.

    It was offered a $17 billion lifeline in 2015 when Walgreens offered to buy the chain. But the deal was met with stiff scrutiny from US regulators who feared the combination would violate federal antitrust laws and reduce competition in the drug store market.

    Ultimately, in 2017, the companies agreed to a smaller, $4.4 billion deal, in which Walgreens bought just under 2,000 Rite Aid locations, leaving Rite Aid diminished in stature and unable to compete at the scale of its bigger rivals.

    — CNN’s Nathaniel Meyersohn and Juliana Liu contributed to this report

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  • US sues Rite Aid for missing opioid red flags | CNN Business

    US sues Rite Aid for missing opioid red flags | CNN Business

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    CNN
     — 

    The Justice Department on Monday filed a lawsuit against Rite Aid for allegedly violating the Controlled Substances Act, alleging that the company “knowingly filled unlawful prescriptions for controlled substances.”

    In a statement, Attorney General Merrick Garland said the Department of Justice is “using every tool at our disposal” to hold Rite Aid accountable for contributing to the opioid epidemic.

    Associate Attorney General Vanita Gupta said “Rite Aid’s pharmacists repeatedly filled prescriptions for controlled substances with obvious red flags, and Rite Aid intentionally deleted internal notes about suspicious prescribers. These practices opened the floodgates for millions of opioid pills and other controlled substances to flow illegally out of Rite Aid’s stores.”

    In the complaint, The Justice department alleges that from May 2014 to June 2019, Rite Aid filled thousands of unlawful combinations of prescriptions known as “the trinity” which included prescriptions for “excessive quantities of opioids, such as oxycodone and fentanyl.”

    Rite Aid pharmacists were accused of ignoring obvious signs of misuse and intentionally deleting some pharmacists’ internal warnings about suspicious prescribers, such as “cash only pill mill???”

    “These practices opened the floodgates for millions of opioid pills and other controlled substances to flow illegally out of Rite Aid’s stores,” Associate Attorney General Vanita Gupta said.

    The Justice Department said the prescriptions, who were issued illegally, “lacked a legitimate medical purpose, were not for a medically accepted indication, or were not issued in the usual course of professional practice.”

    Rite Aid is one of the country’s largest pharmacy chains, with more than 2,330 stores in 17 US states. It did not immediately respond to requests for comment.

    The Justice Department accused Rite Aid of violating the federal False Claims Act by submitting false prescription claims to government health care programs such as Medicare and Medicaid.

    It joined a whistleblower lawsuit filed in 2019 by two pharmacists and a pharmacy technician from Rite Aid stores in Pennsylvania, North Carolina and West Virginia.

    The Justice Department occasionally joins whistleblower cases it considers stronger.

    It has also sued Walmart and drug distributor AmerisourceBergen Corp over their alleged roles in the nation’s opioid crisis.

    More than 500,000 people died from drug overdoses in the United States from 1999 to 2020, including more than 90,000 in 2020 alone, according to the US Centers for Disease Control and Prevention.

    Reuters contributed to this report.

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  • Newsom to shut Walgreens out of California state business following abortion pill decision | CNN Politics

    Newsom to shut Walgreens out of California state business following abortion pill decision | CNN Politics

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    CNN
     — 

    California will cease all its business with Walgreens, the retail drugstore chain, Gov. Gavin Newsom said on Monday, days after the company announced it would not dispense abortion medication in 21 Republican-dominated states.

    “California won’t be doing business with @walgreens – or any company that cowers to the extremists and puts women’s lives at risk,” the Democratic governor tweeted. “We’re done.”

    Newsom’s pushback came at an already fraught time for the future of medication abortion, which is used in more than half of all procedures nationwide, as a Texas judge weighs issuing a ban on Mifepristone, the first pill in a two-drug abortion regimen. Walgreens had responded to legal pressure from Republican attorneys general in 21 states – including a handful where abortion remains legal – in deciding to partially halt its efforts to sell the drug.

    “We intend to be a certified pharmacy and will distribute Mifepristone only in those jurisdictions where it is legal and operationally feasible,” the company said last week in a statement.

    Walgreens declined to comment on Newsom’s tweet.

    The clash between Newsom and Walgreens, a massive chain with thousands of stores around the country, marks the latest round of fallout following the Supreme Court’s decision to overturn Roe v. Wade. The ruling, handed down in June of last year, shook up national politics ahead of the 2022 midterms – with many Democrats crediting the backlash for helping their candidates in tough, swing state and seat races – and complicated relationships between political and business leaders.

    The state is currently “reviewing all relationships between Walgreens and the state,” said Newsom spokesman Brandon Richards. He also accused the company of giving in to “right wing bullies.”

    Newsom’s office announced Wednesday that California would be “pulling back” a renewal of a $54 million contract with Walgreens that would have taken effect May 1, 2023.

    California’s Department of General Services holds a contract with the retailer “to procure specialty pharmacy prescription drugs,” mostly used by the state’s Department of Corrections and Rehabilitation and its correctional health care system, Newsom’s office said in a news release.

    The state will explore other options “for furnishing the same services,” his office said.

    CNN has reached out to Walgreens for comment on Wednesday’s announcement.

    Late last week, Democratic California state Attorney General Rob Bonta issued a statement slamming Walgreens for bowing to political pressure from GOP officials.

    “Medication abortion is safe, effective, and serves as a lifeline for people in need of critical care, especially those from vulnerable and underserved communities,” Bonta said on Friday. “I am disappointed that Walgreens has decided to give in to political pressure from anti-abortion states, and cut off access to these necessary and lifesaving medications.”

    The company on Monday sought to clarify its position, though their latest statement only added to the confusion.

    “Walgreens plans to dispense Mifepristone in any jurisdiction where it is legally permissible to do so,” the company said. Medication abortion is legal and accessible in states like Kansas and Iowa, among others, despite opposition from top Republicans, who have threatened legal action.

    In a letter addressed to Kansas Attorney General Kris Kobach, an anti-abortion Republican, from last month, Walgreens said it “does not intend to dispense Mifepristone within your state and does not intend to ship Mifepristone into your state from any of our pharmacies.”

    Abortion remains protected under Kansas state law. Last summer, the state voted overwhelmingly to block efforts by lawmakers to ban the procedure following the Supreme Court’s decision to overturn Roe v. Wade less than two months earlier.

    The US Food and Drug Administration said in early January that pharmacies certified to dispense Mifepristone can do so directly to someone who has a prescription from a prescriber.

    This story has been updated with additional information.

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  • Europe is running out of medicines

    Europe is running out of medicines

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    When you’re feeling under the weather, the last thing you want to do is trek from pharmacy to pharmacy searching for basic medicines like cough syrup and antibiotics. Yet many people across Europe — faced with a particularly harsh winter bug season — are having to do just that.

    Since late 2022, EU countries have been reporting serious problems trying to source certain important drugs, with a majority now experiencing shortages. So just how bad is the situation and, crucially, what’s being done about it? POLITICO walks you through the main points.

    How bad are the shortages?

    In a survey of groups representing pharmacies in 29 European countries, including EU members as well as Turkey, Kosovo, Norway and North Macedonia, almost a quarter of countries reported more than 600 drugs in short supply, and 20 percent reported 200-300 drug shortages. Three-quarters of the countries said shortages were worse this winter than a year ago. Groups in four countries said that shortages had been linked to deaths.

    It’s a portrait backed by data from regulators. Belgian authorities report nearly 300 medicines in short supply. In Germany that number is 408, while in Austria more than 600 medicines can’t be bought in pharmacies at the moment. Italy’s list is even longer — with over 3,000 drugs included, though many are different formulations of the same medicine.

    Which medicines are affected?

    Antibiotics — particularly amoxicillin, which is used to treat respiratory infections — are in short supply. Other classes of drugs, including cough syrup, children’s paracetamol, and blood pressure medicine, are also scarce.

    Why is this happening?

    It’s a mix of increased demand and reduced supply.

    Seasonal infections — influenza and respiratory syncytial virus (RSV) first and foremost — started early and are stronger than usual. There’s also an unusual outbreak of throat disease Strep A in children. Experts think the unusually high level of disease activity is linked to weaker immune systems that are no longer familiar with the soup of germs surrounding us in daily life, due to lockdowns. This difficult winter, after a couple of quiet years (with the exception of COVID-19), caught drugmakers unprepared.

    Inflation and the energy crisis have also been weighing on pharmaceutical companies, affecting supply.

    Last year, Centrient Pharmaceuticals, a Dutch producer of active pharmaceutical ingredients, said its plant was producing a quarter less output than in 2021 due to high energy costs. In December, InnoGenerics, another manufacturer from the Netherlands, was bailed out by the government after declaring bankruptcy to keep its factory open.

    Commissioner Stella Kyriakides wrote to Greece’s health minister asking him to take into consideration the effects of bans on third countries | Stephanie Lecocq/EPA-EFE

    The result, according to Sandoz, one of the largest producers on the European generics market, is an especially “tight supply situation.” A spokesperson told POLITICO that other culprits include scarcity of raw materials and manufacturing capacity constraints. They added that Sandoz is able to meet demand at the moment, but is “facing challenges.”

    How are governments reacting?

    Some countries are slamming the brakes on exports to protect domestic supplies. In November, Greece’s drugs regulator expanded the list of medicine whose resale to other countries — known as parallel trade — is banned. Romania has temporarily stopped exports of certain antibiotics and kids’ painkillers. Earlier in January, Belgium published a decree that allows the authorities to halt exports in case of a crisis.

    These freezes can have knock-on effects. A letter from European Health Commissioner Stella Kyriakides addressed to Greece’s Health Minister Thanos Plevris asked him to take into consideration the effects of bans on third countries. “Member States must refrain from taking national measures that could affect the EU internal market and prevent access to medicines for those in need in other Member States,” wrote Kyriakides.

    Germany’s government is considering changing the law to ease procurement requirements, which currently force health insurers to buy medicines where they are cheapest, concentrating the supply into the hands of a few of the most price-competitive producers. The new law would have buyers purchase medicines from multiple suppliers, including more expensive ones, to make supply more reliable. The Netherlands recently introduced a law requiring vendors to keep six weeks of stockpiles to bridge shortages, and in Sweden the government is proposing similar rules.

    At a more granular level, a committee led by the EU’s drugs regulator, the European Medicines Agency (EMA), has recommended that rules be loosened to allow pharmacies to dispense pills or medicine doses individually, among other measures. In Germany, the president of the German Medical Association went so far as to call for the creation of informal “flea markets” for medicines, where people could give their unused drugs to patients who needed them. And in France and Germany, pharmacists have started producing their own medicines — though this is unlikely to make a big difference, given the extent of the shortfall.

    Can the EU fix it?

    In theory, the EU should be more ready than ever to tackle a bloc-wide crisis. It has recently upgraded its legislation to deal with health threats, including a lack of pharmaceuticals. The EMA has been given expanded powers to monitor drug shortages. And a whole new body, the Health Emergency Preparedness and Response Authority (HERA) has been set up, with the power to go on the market and purchase drugs for the entire bloc.

    But not everyone agrees that it’s that bad yet.

    Last Thursday, the EMA decided not to ask the Commission to declare the amoxycillin shortage a “major event” — an official label that would have triggered some (limited) EU-wide action— saying that current measures are improving the situation.

    A European Medicines Agency’s working group on shortages could decide on Thursday whether to recommend that the Commission declares the drug shortages a “major event” — an official label that would trigger some (limited) EU-wide action. An EMA steering group for shortages would have the power to request data on drug stocks of the drugs and production capacity from suppliers, and issue recommendations on how to mitigate shortages.

    At an appearance before the European Parliament’s health committee, the Commission’s top health official, Sandra Gallina, said she wanted to “dismiss a bit the idea that there is a huge shortage,” and said that alternative medications are available to use.

    And others believe the situation will get better with time. “I think it will sort itself out, but that depends on the peak of infections,” said Adrian van den Hoven, director general of generics medicines lobby Medicines for Europe. “If we have reached the peak, supply will catch up quickly. If not, probably not a good scenario.”

    Helen Collis and Sarah-Taïssir Bencharif contributed reporting.

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    Carlo Martuscelli

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  • Justice Department sues pharmaceutical company for allegedly failing to report suspicious opioid sales | CNN Politics

    Justice Department sues pharmaceutical company for allegedly failing to report suspicious opioid sales | CNN Politics

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    Washington
    CNN
     — 

    The Justice Department on Thursday alleged that the AmerisourceBergen Corporation, one of the country’s largest pharmaceutical distributors, and two of its subsidiaries failed to report hundreds of thousands of suspicious prescription opioid orders to pharmacies across the country.

    The lawsuit, which spans several states, alleges that AmerisourceBergen disregarded its legal obligation to report orders of controlled substances to the Drug Enforcement Agency for nearly a decade. The company ignored “red flags” that pharmacies in West Virginia, New Jersey, Colorado and Florida were diverting opioids into illegal drug markets, the suit says.

    “The Department of Justice is committed to holding accountable those who fueled the opioid crisis by flouting the law,” Associate Attorney General Vanita Gupta said in a statement Thursday.

    “Companies distributing opioids are required to report suspicious orders to federal law enforcement. Our complaint alleges that AmerisourceBergen – which sold billions of units of prescription opioids over the past decade – repeatedly failed to comply with that requirement,” she added.

    If AmerisourceBergen is found liable at trial, the company faces billions of dollars in financial penalties, the Justice Department said.

    Lauren Esposito, a spokesperson for AmerisourceBergen, countered on Thursday in a statement that said the Justice Department’s complaint rested on “five pharmacies that were cherry picked out of the tens of thousands of pharmacies that use AmerisourceBergen as their wholesale distributor, while ignoring the absence of action from former administrators at the Drug Enforcement Administration – the DOJ’s own agency.”

    She added: “With the vast quantity of information that AmerisourceBergen shared directly with the DEA with regards to these five pharmacies, the DEA still did not feel the need to take swift action itself – in fact, AmerisourceBergen terminated relationships with four of them before DEA ever took any enforcement action while two of the five pharmacies maintain their DEA controlled substance registration to this day.”

    Yet AmerisourceBergen was allegedly aware that in two of the pharmacies, drugs it distributed were likely being sold in parking lots for cash, the Justice Department said. In another pharmacy, the company was allegedly warned that patients likely suffering from addiction were receiving opioids, including some people who later died of a drug overdose.

    The Justice Department also noted in its lawsuit that AmerisourceBergen’s reporting systems for suspicious opioid orders were deeply inadequate, and that the company intentionally changed its reporting systems to reduce the number of orders flagged as suspicious amid the opioid epidemic.

    Even when orders were flagged as suspicious, AmerisourceBergen often didn’t report those orders to the DEA, according to the complaint.

    Opioids are involved in the vast majority of drug overdose deaths, though synthetic opioids – particularly fentanyl – have played an outsized role. Synthetic opioids – excluding methadone – were involved in more than 72,000 overdose deaths in 2021, about two-thirds of all overdose deaths that year and more than triple the number from five years earlier.

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