It was convenient, sold a mix of products people wanted, and everyone was forced to go there (or to one of its rivals) when they needed to pick up a prescription. Now, however, the company has been fighting a war on many fronts. Consumers can order much of what made the chain convenient for delivery, and various online services, including Amazon, now fill prescriptions.
"At the rear of the store, business at pharmacy counters is being squeezed by stingier drug reimbursement rates and pharmacist wages. In the aisles, sales of everything from greeting cards to cosmetics are feeling the effects of cut-price competition," according to the Financial Times. It's an evolving situation that has caused CVS rival Rite Aid to shut down all its stores, while CVS and Walgreens have closed thousands of locations between them.
"The whole drugstore four-wall economic model is collapsing on itself, in my opinion," said Josh Cummings, a portfolio manager at Janus Henderson Investors, told the Financial Times. Now, another CVS division has struggled and will be sold by the company as part of a Chapter 11 bankruptcy. CVS Omnicare, which serves nursing homes, assisted living centers, and long-term care and rehab facilities, filed for Chapter 11 bankruptcy in Sept. 2025, according to documents found on PacerMonitor.
Now, the company, which CVS has owned since 2015, has received court approval for its bankruptcy liquidation. A bankruptcy judge in Texas has approved a wind-down bankruptcy plan by Omnicare after the CVS Health subsidiary sold its business operations for $250 million and reached a $440 million deal with the Justice Department to resolve an improper billing case. Bankruptcy Court for the Northern District of Texas approved Omnicare's Chapter 11 bankruptcy, noting that it received 'overwhelming acceptance' from general unsecured creditors," Seeking Alpha reported.
Outdoors retailer closing 91 stores in Chapter 11 bankruptcy 97-year-old aerospace manufacturer files Chapter 11 bankruptcy 60-year-old dining chain franchisee files Chapter 11 bankruptcy The long-term care pharmacy services provider filed for bankruptcy in September 2025, just months after getting hit with a $949 million judgment for fraudulently dispensing drugs without valid prescriptions to elderly and disabled patients and billing federal government healthcare programs for millions of false claims. The government later resolved the $949 million judgment through a $440 million settlement that requires CVS to pay $130 million upfront and cover the remaining $310 million if Omnicare fails to do so by March 2028, according to Bloomberg Law. The approved settlement will protect CVS Health from any future liability.
District Judge Colleen McMahon in Manhattan imposed a $542-million penalty for filing 3,342,032 false claims between 2010 and 2018. McMahon also awarded $406.8 million of damages, representing three times the $135.6 million that a jury awarded on April 29," reported. Attorney for the Southern District of New York Jay Clayton, who brought the case against CVS Omnicare, celebrated his victory in a press release.
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