Home / Business and Economy / Walgreens Cedes Ground: CVS Dominates Neighborhood Pharmacies
Walgreens Cedes Ground: CVS Dominates Neighborhood Pharmacies
13 Sep
Summary
- Walgreens is closing approximately 1,200 U.S. stores by 2027.
- CVS is absorbing customers from shuttered Walgreens locations.
- Walgreens went private in August 2025 via a $10 billion sale.
Walgreens is closing approximately 1,200 of its U.S. stores by 2027, a move that began following its $10 billion sale to private equity firm Sycamore Partners in August 2025. This transition to private ownership, which saw Mike Motz named CEO, has allowed the company to address challenges like shrinking reimbursement rates and increased competition without public market scrutiny.
As Walgreens trims its footprint, CVS is effectively absorbing its rival's customers. Federal and state regulations ensure an orderly transfer of prescription records, often directing patients to the nearest CVS pharmacy due to overlapping store locations. This strategic shift benefits CVS without requiring direct competitive action.
Together, CVS and Walgreens now represent nearly 40% of all U.S. retail prescription sales. CVS also benefits from its vertical integration, particularly its ownership of Caremark, a major pharmacy benefit manager, which helps mitigate reimbursement pressures impacting standalone retailers.
