The retail pharmacy landscape is beginning to worsen in America, with many communities experiencing at least one location closure in the last year alone. It is more than Walgreens versus CVS that this shows, but really reflects wider market dynamics, shifting trends in consumer behaviors, and general unrest in the marketplace. And as those doors begin to close, some experts are beginning to raise alarms over the impacts this will have on public health, notably in places with high need.
The scale of community pharmacy closures
Indeed, recent reports show that approximately 30% of retail pharmacies have closed since 2010, while the pace of closures has dramatically accelerated in recent years. A report in Health Affairs estimated that from 2010 to 2021, about 29.4% of retail pharmacies closed, compared to earlier years that saw the closure of only 12.5% of community pharmacies between 2009 and 2015. This trend is especially high in communities of Black and Latino populations, who are most likely to live in areas deemed ‘pharmacy deserts,’ or those with limited or no pharmacy access.
Major chains like CVS and Walgreens have announced large-scale store closures in their strategic movements towards reduced revenues and operational costs. For example, CVS has declared the shutdown of 900 stores within three years, and Walgreens has posted the closure of 1,200 stores by 2026. This can be attributed to heightened competition from online pharmacies, shifting consumer preferences, and outright theft problems emanating from the brick-and-mortar stores.
Reasons of closure
Several factors are interconnected and lead to the further decline of pharmacies:
- Changing consumer preferences: A growing number of consumers are opting for mail-order pharmacies and online services due to convenience and perceived efficiency. A J.D. Power study noted a decline in customer satisfaction with traditional brick-and-mortar pharmacies, which fell by 10 points on a 1,000-point scale from 2023 to 2024.
- Economic pressures: Increasing costs of rent, labour, and inventory management on one side, while on the other side, the overall reimbursement rates of prescription medications have declined, thus pressuring many pharmacy margins.
- Theft and safety concerns: Pharmacy retail has increasingly become a problem in many pharmacies, but particularly in those in urban centers. Clearly, high-value merchandise, such as pharmaceuticals, is very easy to steal; for this reason, companies like Walgreens have been closing stores where theft is too high.
- Market saturation: Many chains overexpanded several decades ago and today find themselves overextended. The chief executive for Walgreens Boots Alliance, Tim Wentworth, was cited as stating that before its latest closures, it generated about 25% of its stores that were not earning their keep.
Impact on society
Community pharmacies stand at a very important place concerning community health. Besides the mere dispensing of medications, they have increasingly become a source for vaccinations, health screenings, and medication management services. Generally, in most instances, they stand as the first point of contact with the medical community for advice or treatment.
Research has shown that when a pharmacy closes, patients have poorer medication adherence. For example, several studies have found that patients who lived in neighborhoods in which there was a closure of pharmacies were less likely to fill prescriptions of beta blockers and anticoagulation medications. This increased disparity in adherence serves to widen further the disparity gap in health outcomes, particularly within the vulnerable population that relies on community pharmacies for so much of their health care.
According to Dr. Omolola Adepoju at the University of Houston, this is an area needing urgent action: “Pharmacy closures disproportionately affect underserved neighborhoods, deepening existing health disparities.” That means that targeted solutions must be sought in ensuring equity in access to health services across communities.
Way forward and a possible solution
As continued pharmacy closures shape the face of health care, experts propose several strategies that would help mitigate their impact:
- Policy interventions: Many advocates recommend policy strategies to support independent pharmacies and their inclusion in the preferred pharmacy networks from insurers. Increasing Medicaid reimbursement rates for pharmacies deemed at risk may support the sustainability of such needed services as well.
- Community engagement: Creating partnerships among healthcare providers and other community-based groups can improve access to medication and health services. Programs that bring pharmacies into community centers, or the use of telehealth options, may help address the gaps created in the case of closures4.
- Innovative delivery solutions: Companies like Walgreens are exploring delivery options for prescriptions within certain distances to maintain service levels despite physical store closures. However, these solutions lack the personal interaction typically provided by pharmacists.
Read more: U.S. cucumber recall increases – These are the companies that have recalled products after 68 people in 19 states became ill with salmonellosis
Read more: Miss America pageant files for bankruptcy after 103 years – What will happen to the 2025 edition after owner feud?
