Investors Purchase Stake in drugstore.com From Rite Aid
BELLEVUE, Wash., May 6, 2002 -- drugstore.com, inc. (Nasdaq:DSCM), the leading Internet retailer for health, beauty, wellness and pharmacy products announced today in response to investor inquiries certain details regarding recent activities in drugstore.com, inc. A group of investors, led by drugstore.com board member Melinda Gates, Maveron Equity Partners L.P, and Kleiner Perkins Caufield & Byers, have purchased approximately 6.8 million shares of drugstore.com common stock from Rite Aid Corporation, increasing their current investments in drugstore.com. drugstore.com director, Dan Levitan is the managing partner of Maveron Equity Partners L.P. drugstore.com directors Brook Byers and L. John Doerr are partners in Kleiner Perkins Caufield & Byers. Rite Aid's divestment does not affect the 10-year strategic, commercial relationship between drugstore.com and Rite Aid, entered into in July of 1999. The relationship provides that drugstore.com will be the exclusive online pharmacy for Rite Aid and enables customers of the drugstore.com(TM) pharmacy to order prescriptions through the Web site for local pickup at 3500 Rite Aid Stores nationwide. "Over the past 3 years, we have developed a proven history and a good working relationship with drugstore.com," says Mary Sammons, President and Chief Operating Officer of Rite Aid. "drugstore.com provides a great service for our customers who enjoy ordering their prescriptions and other products online. We don't feel that retaining the equity investment in drugstore.com is necessary to continue offering and enhancing these services." Speaking about their recent purchase, Melinda Gates said, "drugstore.com has a history of solid execution and outstanding customer service." Dan Levitan echoed Gates' sentiments adding, "We are enthusiastic about the prospects for drugstore.com and believe customers will continue to embrace the company's products and services." Quellos Brokerage Services, LLC, based in New York, acted as agent for both the buyers and the seller in this transaction. drugstore.com, inc. (Nasdaq:DSCM) is the leading online drugstore and information site offering A Very Healthy Way to Shop(TM) for health, beauty, wellness, personal care, and pharmacy products. The drugstore.com(TM) online store provides a convenient, private, and informative shopping experience that encourages consumers to purchase products essential to healthy, everyday living. The Web store offers thousands of brand-name personal health care products at competitive prices; a full-service, licensed retail pharmacy; and a wealth of health-related information, buying guides, and other tools designed to help consumers make informed purchasing decisions. Consumers can personalize their shopping experiences with shopping lists, e-mail reminders for replenishing regularly used products, and private e-mail access to pharmacists and beauty experts for questions. drugstore.com has been awarded the Verified Internet Pharmacy Practice Sites (VIPPS) certification by the National Association of Boards of Pharmacy (NABP) as a fully licensed facility exercising the best safe pharmacy practices in compliance with federal and state laws and regulations. drugstore.com has also been rated the top health category site by Forrester PowerRankings, which provides objective rankings of the leading e-commerce sites. drugstore.com has formed strategic relationships with Amazon.com (Nasdaq:AMZN), Rite Aid Corporation (NYSE, PSE: RAD), WellPoint Health Networks Inc. (NYSE:WLP) and General Nutrition Companies, Inc. (Nasdaq:GNCI). The historical results contained in this press release are preliminary and unaudited. In addition, this press release contains forward-looking statements regarding future events or the future financial and operational performance of drugstore.com. Words such as "expects", "believes", "anticipates" and similar expressions are intended to identify forward-looking statements. Actual performance may differ materially from those contained or implied in such forward-looking statements. Risks and uncertainties that could lead to such differences could include, among other things: drugstore.com's limited operating history, the unpredictability of future revenues and expenses and potential fluctuations in revenues and operating results, risks related to business combinations and strategic alliances,
consumer trends, the level of competition, seasonality, the timing and success of expansion efforts, risks related to systems interruptions, possible governmental regulation, and the ability to manage a rapidly growing business. Additional information, regarding factors that potentially could affect drugstore.com's business, financial condition and operating results is included in drugstore.com's filings with the Securities and Exchange Commission, including in the prospectus dated March 15, 2000 relating to drugstore.com's public offering of common stock, in the prospectus on Form S-3, effective October 2, 2000 and in our periodic filings with the SEC on Forms 10K and 10Q. "Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding drugstore.com's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year. CONTACT: For drugstore.com, inc. Jenny Bendel, 425/372-3203 jbendel@drugstore.com