Key Takeaways:
- Pharmacies are closing fast — CVS, Walgreens, and Rite Aid have shuttered thousands of stores as profits fall and shopping habits shift.
- Prescription payments are the breaking point — low reimbursement rates from pharmacy benefit managers (PBMs) mean many stores lose money on every prescription they fill.
- Communities are paying the price — closures hit low-income and urban neighborhoods hardest, leaving “pharmacy deserts” where access to medicine and health advice disappears.
For decades, neighborhood drugstores like CVS, Walgreens, and Rite Aid anchored the corner of almost every busy intersection. They were places where people not only picked up prescriptions but also got flu shots, asked pharmacists health questions, and grabbed everyday essentials on the way home.
Now, those familiar storefronts are disappearing. And for many low-income and inner-city neighborhoods, the loss of a local pharmacy is more than inconvenient — it’s a public-health crisis.
A Wave of Closures Nationwide
The numbers are staggering. CVS has already closed about 900 stores since 2021 and plans to shut another 271 in 2025 as part of a multi-year restructuring plan. Walgreens, facing similar financial pressure, expects to close roughly 1,200 underperforming stores by 2027 — including about 500 this year. And Rite Aid, once one of America’s largest pharmacy chains, has now closed all of its remaining stores, ending 63 years in business after a second bankruptcy filing.
Industry leaders admit the current model is “not sustainable.” Around a quarter of Walgreens’ stores are unprofitable, and closures are targeting locations struggling with high theft, declining sales, or overlap with nearby stores. CVS has also been trimming locations as it shifts toward smaller, pharmacy-focused formats.
The reasons behind the closures run far deeper than theft, though that has played a visible role. Locked display cases and empty shelves have become common in many city stores. Retail theft, along with higher security costs, has made already-struggling locations even harder to keep open.
But these challenges are just part of what are larger shifts in how Americans shop — and how the drug industry itself is structured.
Changing Shopping Habits
In the 1990s and early 2000s, big drugstore chains grew aggressively, opening new stores in nearly every neighborhood to dominate the market. They wanted to be both the local pharmacy and the convenience store.
But over the past decade, consumers have changed how they buy.
Household goods and personal-care items once bought at drugstores are now ordered online or found cheaper at Walmart, Target, or dollar stores — retailers that have increased their presence in low-income and urban neighborhoods. The “front end” of the drugstore, which sells snacks, cleaning supplies, and small gifts, simply isn’t making enough money to sustain all those extra locations.
As people shop elsewhere, drugstores have leaned even harder on prescriptions — which were supposed to be their most stable business. But that’s now where they’re losing the most.
The Prescription Pinch
Most of a pharmacy’s revenue comes from filling prescriptions, but profits from that business have plummeted. The reason, many pharmacists say, lies with pharmacy benefit managers (PBMs) — the powerful middlemen that negotiate drug prices between manufacturers, insurers, and pharmacies.
Pharmacies claim that PBMs reimburse them for less than what they pay to buy some drugs. In other words, pharmacies are losing money every time they fill certain prescriptions. Independent pharmacies and small-chain locations in low-income areas are hit hardest, because they don’t have the same leverage as large corporate chains.
PBMs argue that they help control costs by pushing drugmakers for rebates and discounts. But critics — including pharmacists and patient advocates — say PBMs keep too much of the savings for themselves, operate with little transparency, and have grown so dominant that they effectively control what drugs are covered and how much pharmacies get paid.
Communities Losing More Than Stores
When a pharmacy closes in a low-income neighborhood, the impact ripples through the entire community. For many residents, these stores serve as accessible health hubs — the first stop for vaccines, over-the-counter medicines, and trusted advice from pharmacists who often know their patients personally.
Without them, people must travel farther for prescriptions and medical supplies — a burden for seniors, those without cars, and people managing chronic illnesses like diabetes or heart disease.
Researchers warn that this growing map of “pharmacy deserts” poses a serious threat to public health. A study in the Journal of the American Medical Association found that pharmacies in low-income areas, particularly those serving large numbers of patients on Medicaid, are far more likely to close. Already, one-third of neighborhoods in major U.S. cities lack a local pharmacy — and the numbers are climbing.
The Bigger Picture: America’s Drug-Price Problem
At the root of the crisis is one undeniable fact: Americans pay more for prescription drugs than anyone else in the world.
A 2024 report by the RAND Corporation found that U.S. drug prices are nearly three times higher than in other wealthy countries. That’s because, unlike most nations, the U.S. has no system of national price negotiation. Drug prices are set by manufacturers, then filtered through a maze of insurers and PBMs before they reach your pharmacy counter. Each step adds complexity — and profit — but little relief for consumers.
Recent efforts to control costs have come from both political parties. Former President Donald Trump signed an order to tie certain U.S. drug prices to the lower rates paid abroad, while President Biden’s Inflation Reduction Act gave Medicare new power to negotiate directly with drug companies. Still, progress has been slow, and the system remains fragmented.
Until the U.S. can rein in prescription costs and reform how reimbursement works, drugstores — especially those in already-struggling neighborhoods — will keep disappearing.
What’s at Stake
Drugstores were never just retail spaces. They were neighborhood fixtures, trusted by seniors, families, and caregivers. The pharmacist was often the most accessible health professional in the community.
Now, as chains close and independent stores vanish, millions of Americans are left navigating chronic illness, medication management, and rising costs without that support.
If nothing changes — if reimbursement rates remain unfair, if drug prices stay sky-high, and if the country fails to treat access to medicine as a basic public good — the trend will only accelerate.
The corner pharmacy, once a symbol of convenience and care, is fast becoming an endangered species. And the communities that can least afford to lose them will pay the highest price.