CVS Health and Walgreens announced on Wednesday that they had reached an agreement in principle to pay a total of $10 billion to settle a series of opioid-related lawsuits filed against the pharmacy chains.
CVS announced a $5 billion settlement to "substantially resolve" the open opioid lawsuits against it. CVS's chief policy officer and general counsel stated that the company is pleased to resolve these long-standing claims and put them behind them in the best interests of all parties, including our customers, colleagues, and shareholders. He went on to say that the company is committed to working with states, municipalities, and tribes, and that it will continue to support important initiatives aimed at reducing the illegal use of prescription opioids.
Walgreen also stated that it had reached an agreement in principle on a $4.95 billion settlement to be paid over 15 years. According to a spokesperson for Walgreens, the company remains committed to being a part of the solution, and this settlement framework will allow the organization to keep the focus on the health and well-being of customers and patients while making positive contributions to addressing the opioid crisis.
The spokesperson for Walgreens even stated that the company believes that this is in the best interests of the company and the stakeholders at this time and that it allows pharmacists, dedicated healthcare professionals who live and work in communities, to serve and continue to play a critical role in providing education and resources to help combat opioid misuse and abuse.
CVS stated that the national settlement, which has been reached in principle, would resolve lawsuits filed by states and other governments. Some of these allegations go back a decade or more. According to the company, the settlement is not an "admittance of any liability or wrongdoing."
CVS Health stock rose about 4% after the company released third-quarter earnings alongside the settlement announcement. Walgreens' stock increased by about 2%.
Depending on the number of governmental entities that agree to join the settlement, CVS's settlement payments would be spread out over a 10-year period beginning in 2023. According to CVS, the parties are still negotiating the "non-monetary" terms of the settlement.
CVS's payments would include approximately $4.9 billion to states, cities, counties, and other political plaintiffs, according to CVS. According to the statement, tribes would receive approximately $130 million.