Rite Aid looks to build ‘Store of the Future,’ lead with rebranded PBM

David Salazar
Managing Editor
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Rite Aid is in the middle of what it has dubbed an “RxEvolution.” At the Camp Hill, Pa-based retailer’s virtual Analyst Day event on Monday, executives outlined its plan to position is PBM offering as a leader among mid-market plans, expand the role of its 6,400 pharmacists and build a Store of the Future that can appeal to younger consumer while also including a Pharmacy of the Future. 

When it comes to the pharmacy, Rite Aid CEO Heyward Donigan said that the company’s pharmacists play a key role in getting customers engaged in their health-and-wellness journey. 

“The pharmacist is the key to engaging consumers and the last mile connection between the health care delivery system and the consumer,” Donigan told Drug Store News Monday afternoon in an exclusive interview. “Our pharmacists touch consumers between 25 and 30 times a year — and that's about eight times more than a primary care physician interacts with his or her patients. So, if anyone can engage consumers, it's got to be us. It has to be comprehensive. And it can be because 90% of consumers trust their pharmacists, and 98% of pharmacists at Rite Aid say what they really want to do as part of their mission and purpose is engage with consumers in their health and wellness.”

To make this concept a reality, Rite Aid is rethinking how the space behind the pharmacy counter works to facilitate a changed production workflow that relies more on pharmacy technicians, as well as increased pharmacist consultation with patients. It also means moving certain OTC/alternative therapy merchandise that presents a counseling opportunity closer to the pharmacy. Currently, Donigan said that five locations in Baltimore are piloting the new workflows with a focus on increasing productivity to enable pharmacists to engage with consumers. She also noted that the company is building prototypes of potential future pharmacy layouts. 

As it rethinks the pharmacy, Rite Aid also is taking a new approach to thinking about the whole store, Donigan said, with a focus on attracting millennial and Gen X shoppers. 

“We aren’t backing away from retail. What we’re doing is focusing on retail that is on trend and relevant for the customer that we’re going after,” Donigan said. “We’re really excited to be rolling out this new merchandise.”

The first step to getting new items on shelves is sunsetting merchandise that isn’t turning. As part of this, Donigan said Rite Aid is exiting electronics, motor oil, clothing  and other categories she said “not only aren’t relevant to those consumers but actually degrade our brand.” 

Reduced merchandise will make room for more air in the planogram, as well as the new merchandise, which Donigan said would include more better-for-you consumable options, trendy skin care and other categories she said the chain is hoping will inject some fun

“We're not just about getting healthy. We're about getting thriving,” Donigan said. “And thriving is not just about not drinking soda and getting the right medications. It's about having fun. It’s not a clinical experience, it’s a 'radiating wellness and getting thriving' experience that’s fun and nonjudgmental.”

Refreshed interiors and signage will also bring a new Rite Aid logo and the chain plans to roll out new exterior signage to all of its stores by the end of the year. Additionally, the company plans to refresh its digital presence, including its e-commerce website and mobile app. In the opening salvo of its fight to attract younger shoppers, Donigan said Rite Aid is would be testing the Store of the Future concept, including the Pharmacy of the Future in nine locations nationwide in urban, rural and suburban areas. Additionally, she said the company would be almost completely redoing stores in Norfolk, Va., and a full makeover of all stores in Boise, Idaho — moves Donigan said is based on the population density of target consumers in those markets.


Also being rebranded is Rite Aid’s EnvisionRxOptions PBM business. The newly renamed Elixir will include RxBenefits and RxInsurance divisions. RxBenefits encompasses pharmacy benefits management, as well as specialty pharmacy, mail-order pharmacy, Laker claims adjudication software and an Rx savings program. RxInsurance includes Part D plans, employer group waiver plans and commercial plans. All told the company pegs the opportunity for Elixir at $400 billion, particularly when taken alongside the company’s retail pharmacy footprint. With the rejiggered Elixir, the company expects to grow its share of EnvisionRxOptions members from 13% to 30%.