Rite Aid stock price experience steep swings throughout the trading day, soaring more than 20% higher than its opening price in morning trading and then falling to near-session lows close to midday. The stock surged again in the afternoon and ended the day 8.23% higher.
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The sharp swings follow Rite Aid’s stock price decline on Friday as a result of rumors that the drugstore business was getting ready to file for bankruptcy.
The sbased chain sank 51% on Friday setting a new all-time low of $0.71 a share. Shares of Rite Aid (RAD) are down more than 91% since this time last year.
The Wall Street Journal and Bloomberg both claimed that Rite Aid was getting ready to file for Chapter 11 bankruptcy, which led to today’s decline. Currently owing roughly $3.3 billion, Rite Aid is also fighting a lawsuit for allegedly filling illegal opioid prescriptions.
In March, the firm sue by the Department of Justice on the grounds that it had intentionally process “illegal prescriptions for controll substances.” Both the False Claims Act and the Controll Substances Act are broken by that
Rite Aid’s debt would be restructure through bankruptcy, including any legal liabilities.
In a statement released on Friday, Rite Aid said that company “does not comment on rumors and speculation.”
With more than 2,200 locations spread across 17 states, Rite Aid is currently the seventh-largest pharmacy business in the country.
Following similar opioid litigation, Purdue, Endo Pharmaceuticals, and Mallinckrodt have also filed for bankruptcy.
The Department of Health and Human Services estimates that since 1999, more than 760,000 people have passed away due to a drug overdose.
