Walmart agrees to $3.1 billion settlement over opioid lawsuits

Walmart has agreed to a $3.1 billion legal settlement over the toll of powerful prescription opioids sold at its pharmacies, marking the latest major drug industry player to promise major support to state, local and tribal governments still grappling with a crisis in overdose deaths.

The retail giant's announcement on Tuesday follows similar proposals on November 2 from the two largest U.S. pharmacy chains, CVS Health and Walgreen Co., which each said they would pay about $5 billion.

The majority of drugmakers that produced the most opioids have already reached settlements, as have the biggest drug distribution companies. With the largest pharmacies now joining in, the settlements represent a shift in the opioid litigation saga. For years, the question of whether companies would be held accountable for the overdose crisis that a flood of prescription drugs helped spark remained. 

With the crisis still raging, the focus is now on how the settlement dollars — totaling more than $50 billion — will be used and whether they will help curtail record numbers of overdose deaths, even as prescription drugs have become a relatively small portion of the epidemic.

Settlement is not an admission of liability

Bentonville, Arkansas-based Walmart said in a statement that it "strongly disputes" allegations in lawsuits from state and local governments that its pharmacies improperly filled prescriptions for the powerful prescription painkillers. The company does not admit liability with the settlement plan. The settlement would represent about 2% of its quarterly revenue.

"Walmart believes the settlement framework is in the best interest of all parties and will provide significant aid to communities across the country in the fight against the opioid crisis, with aid reaching state and local governments faster than any other nationwide opioid settlement to date," the company said in a statement.

Walmart added that it "will continue to vigorously defend the company against any lawsuit not resolved through this settlement framework."

Lawyers representing local governments said the company would pay most of the settlement over the next year if it is finalized.

Oversight measures

New York Attorney General Letitia James said in a statement that Walmart would have to comply with oversight measures, prevent fraudulent prescriptions and flag suspicious ones.

James added that the settlement "will require significant improvements in how Walmart's pharmacies handle opioids."

The deals are the product of negotiations with a group of state attorneys general, but they are not final. The CVS and Walgreens deals would have to be accepted first by a critical mass of state and local governments before they are completed. Walmart's plan would have to be approved by 43 states. The formal process has not yet begun.

James said that she is "optimistic" that the settlement will receive the support of the required 43 states by the end of 2022, allowing local governments to join in the settlement in early 2023.

After governments used funds from tobacco settlements in the 1990s for purposes not related to public health, the opioid settlements have been crafted to ensure most of the money goes to fighting the crisis. State and local governments are devising spending plans now.

Opioids of all kinds have been linked to more than 500,000 deaths in the U.S. over the past two decades.

In the 2000s, most fatal opioid overdoses involved prescription drugs such as OxyContin and generic oxycodone. After governments, doctors and companies took steps to make them harder to obtain, people addicted to the drugs increasingly turned to heroin, which proved more deadly.

In recent years, opioid deaths have soared to record levels around 80,000 a year. Most of those deaths involve illicitly produced version of the powerful lab-made drug fentanyl, which is appearing throughout the U.S. supply of illegal drugs.

In:
• Opioid Epidemic
• Walmart