Rite Aid CEO talks abortion ruling, earnings, and transforming the pharmacy business (2024)


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Uh, let's turn our attention now to pharmacy company rite aid, which reported earnings.

Yesterday we are seeing this stock up in a big way on the back of that in the session today, let's bring in president and ceo heyward donegan who's joining us today and uh heyward, it's good to talk to you today.

I do have to ask you about this news that we have been following out of the supreme court.

I know you're, not a political analyst, but increasingly we're seeing corporate ceos having to weigh in on this.

Let me just get your reaction to the decision that just came down.

Well, I guess I will react as an employer, and this is a big decision.

We provide health coverage to over three thousand employees across the company and our number one concern is and always will be, their best interest and their wellness and writing's been working with our health care administrator.

In anticipation of some decision on contingencies, we aren't able to address the specifics, but I think this just shows the importance of health care in people's lives and as a pharmacy company, we're really excited to continue to advance healthcare for all and the interests of healthcare for all uh, hey, it's brian chung.

Here as a follow-up.

To that I mean you were kind of speaking as an employer as a pharmacy.

You, you also I'm sure, watching this very closely, and I feel like this is such an important conversation, especially because you are across state lines and kind of the federal stance, and all this is very important, just kind of wondering if you know from the pharmacy standpoint of your business, do you have any thoughts on that as well? Well, this really doesn't impact the pharmacy business.

I mean we do obviously provide contraceptive and reproductive products and medications, but um other than that.

I can really only comment as a employer.

Let's shift to the numbers that we got out from the company, obviously you're getting a big pop on the back of your report.

There talk to me about the real strength that you're seeing right now.

Well, I think what we're so excited about is, as rite aid has been and will continue to define the modern pharmacy.

We've really been maintaining the integrity of pharmacists as a trusted health care, professional, someone that engages with customers on a daily basis and also provides convenience and access to medications and alternative therapies and supplemental therapies for our customers in any way they want to get it whether it's delivery by mail buy online, pick up and store, and I think what's happened is coming out of covid, which has been, I think, if nothing else showing how important a pharmacist is in the healthcare lives of our communities.

We were able to show strong results, even cycling out the significant number of vaccines and testing that we had last year, so we showed 100 million in ebitda we showed 6 billion in revenue for the quarter.

We beat consensus on both revenue and ebitda and we're getting back to business.

Our script growth is one percent up even after cycling.

Those strong covered results, yeah and hey we're to just kind of elaborate on that, specifically in the pharmacy business, it seems like, even though you have fewer people coming in to get their vaccines.

You've actually offset some of that decrease by an increase in non-covered prescriptions, so net net.

How should we be thinking about just kind of the the business in terms of revenue uh on that specific line? Yeah, I think that's what's so exciting and I think that's why people are enthusiastic is the fact that we could show a one percent increase in scripts, even with a three million fewer covet vaccines than we did year over year.

So I think what that demonstrates is acute.

Scripts are up almost 12 percent uh, that's a big number! It's it's! It's really back to where it used to be when we were all going to the doctors and living our lives before covet.

Well, we're all going back to the doctors and living our lives now with covet and it's exciting to see people getting back into their health care routines.

It's very important because mental health and physical health has really been not well attended to over the last two years, uh.

Finally hayward.

If we look at the big picture here um, you know you mentioned this shift that you're seeing within the company.

Obviously you are in the middle of the transformation.

I wonder where you are in that I mean thinking back to back in 2020 when you talked about where the future of pharmacy is going a retail pharmacy.

Are you halfway there? I mean give me a sense of where you are in that pivot.

I would say: rite aid is making good strides on our original transformation project, which was to really redefine the role of pharmacists in the communities that kind of that accelerated during the pandemic, also to build elixir.

Our pharmacy management services company build out those assets which includes a mail order: pharmacy, specialty, pharmacy, a pharmacy benefit management, company and a cash card savings program, and then, finally, all of the digital work that we wanted to do, which also was accelerated by covit.

So I would say we're we're in a good place, not as far along as I would have liked to have been just because we did get a bit distracted by covid, but we're in a good place.

I would say the next two years, you're going to see really meaningful new creative opportunities, innovation and expansion coming out of our organization, some of which I talked about on the earnings call and more to come in the next few months and then hayward is is scale kind of an important part of that story, because it seems like the strategy right now is to kind of make sure that you're, you know streamlining what you have right now uh.

We know that you still have debt that you're handling, although there's no debt due until 2025, but still very much a part of the short-term future for your company.

But at the same time, I imagine you want to see more growth in specifically the elixir, the pvm type of side of your business.

So do you have to get bigger, just even in terms of total assets, to achieve what you're trying to do here? Well, brian? I think it's a good question.

We don't need to buy anything and that's I'm excited about our 1.7 billion dollars in liquidity, because we have plenty of room to invest.

We have all the assets we need to scale and what we do need to do is grow into those assets.

So we have exciting opportunities to grow mail order.

Pharmacy benefit management, business.

We are showing strong growth, we sold 80 000 lives just this year and it's just the beginning of the sale season.

We are.

We have a specialty pharmacy that could handle a lot of additional both limited distribution, drugs and volumes, and also our retail pharmacies have capacity to grow as well.

All right, hey we're done again right aid, president and ceo stopping by yahoo finance.

I really appreciate you taking the time this morning, thanks so much.

Rite Aid CEO talks abortion ruling, earnings, and transforming the pharmacy business (2024)


Did the CEO of Rite Aid get fired? ›

On January 7, 2023, Rite Aid Corporation announced that Heyward Donigan, the company's President and Chief Executive Officer, had stepped down, effective immediately, and that Elizabeth ("Busy") Burr, a member of the company's Board of Directors, was appointed as the interim CEO.

Who is CEO of Rite Aid? ›

Elizabeth “Busy” Burr, Chief Executive Officer – Interim

Burr was most recently the former President and Chief Commercial Officer at Carrot Inc., a digital healthcare company with solutions that combine behavioral science, clinical expertise, and proprietary technology, from 2019 through 2021.

Where is Rite Aid headquarters? ›

Image of Where is Rite Aid headquarters?
Camp Hill is a borough in Cumberland County, Pennsylvania, United States. It is 3 miles southwest of Harrisburg and is part of the Harrisburg–Carlisle metropolitan statistical area. The population was 7,888 at the 2010 census.

Did Rite Aid CEO Heyward Donigan leave the drugstore chain? ›

Rite Aid CEO leaves drugstore chain, former Humana exec named interim head. Heyward Donigan is no longer CEO at Rite Aid. The chairman of the Philadelphia drugstore chain said the company's board determined, and the departing CEO agreed, that "now is the right time to identify the next leader of the business.”

How much did Rite Aid CEO make? ›

Of this total $1,000,000 was received as a salary, $1,160,000 was received as a bonus, $0 was received in stock options, $7,389,087 was awarded as stock and $22,000 came from other types of compensation. This information is according to proxy statements filed for the 2021 fiscal year.

Who did Rite Aid buy out? ›

Acquisition of Bartell Drugs

In October 2020, Rite Aid announced the acquisition of the privately held Bartell Drugs, a 67-location Seattle-area chain, for $95 million. Some customers have criticized the acquisition with reports of heavy staff turnover and computer system glitches.

What did Martin Grass do? ›

Grass was forced to resign, though it was later revealed that, even after he quit, he colluded to forge backdated documents giving several Rite Aid executives generous severance payments. He was charged with fraud in 2002 and sentenced in 2004 to eight years in jail.

Who is the head of communications at Rite Aid? ›

Susan Henderson serves as the Senior Vice President and Chief Communications Officer of Rite Aid. Bob Himler serves as the Vice President, Private Brand Development of Rite Aid. Frank Ho serves as the Vice President of Indirect Procurement of Rite Aid.

What is the Rite Aid scandal? ›

The Justice Department announced today that the United States has filed a complaint in intervention in a whistleblower lawsuit brought under the False Claims Act (FCA) against Rite Aid Corporation and various subsidiaries (collectively Rite Aid) alleging that Rite Aid knowingly filled unlawful prescriptions for ...

How many Rite Aid stores are left in the United States? ›

2214 Rite Aid Stores in the United States.

What state has the most Rite Aid? ›

There are 2,169 Rite Aid pharmacies in the United States as of June 06, 2023. The state with the most number of Rite Aid locations in the US is California, with 478 pharmacies, which is about 22% of all Rite Aid pharmacies in the US.

How much is the Rite Aid CEO worth? ›

The estimated Net Worth of Heyward R Donigan is at least $9.54 Million dollars as of 22 December 2021. Ms. Donigan owns over 14,350 units of Rite Aid stock worth over $917,577 and over the last 7 years she sold RAD stock worth over $0.

When did Heyward Donigan become CEO of Rite Aid? ›

Donigan has served as Rite Aid's CEO since August 2019, when she succeeded John Standley, who left the company after holding the CEO spot since June 2010.

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