Earlier this year, attorneys representing New Mexico announced that the state reached a $500 million settlement with Walgreens for the pharmacy’s alleged involvement in the opioid epidemic. On the same day as the New Mexico settlement announcement, California Attorney General Rob Bonta announced a settlement with Walgreens and CVS involving similar allegations.
New Mexico
The $500 million settlement came on the heels of a two-month bench trial where it was argued that “Walgreens failed in its ‘corresponding responsibility,’ a duty under state and federal law requiring pharmacies to recognize suspicious, red flag prescriptions, and refuse to fill them if they are not issued for a legitimate medical purpose.”
The settlement represents one of the largest separate settlements obtained from a single opioid defendant and the largest settlement obtained from a single defendant in the state of New Mexico. It is in addition to the $274 million settlements from Albertsons, Kroger, CVS, and Walmart, bringing New Mexico’s total recovery to $774 million. When added to the amounts paid to New Mexico by other defendants paid to the state (including AmerisourceBergen, Cardinal Health, McKesson, and Johnson & Johnson), the state has received more than $1 billion in connection with the opioid epidemic.
“During the trial, witness after witness testified about the devastation wrought by the opioid crisis in New Mexico and the profound harm caused by opioids in communities across the state. Indeed, this isn’t just another case for our team. When we heard about what was happening, we knew something had to be done. Now, after more than five years of litigation and six weeks of trial, we are confident that this record settlement positions New Mexico to turn the tide on this deadly epidemic,” said Baron & Budd Shareholder and co-lead counsel in the trial, Mark Pifko.
“Too many lives have been lost or ruined as a result of the opioid crisis. The burden on families, both financially and emotionally is immeasurable. That said, this settlement is a major step in our effort to hold companies like Walgreens accountable for their egregious conduct, and we expect the outcome of this case will not only cause these corporate wrongdoers to change their behavior, but, most importantly, put New Mexico on a path to recovery,” said Baron & Budd Shareholder and co-lead counsel in the trial, Dan Alberstone.
California
California Attorney General Rob Bonta also announced that four opioid settlements with the state of California are moving forward, at a value of up to $17.3 billion. Allergan has committed to moving forward with a $2.37 billion settlement while Teva will move forward with a $4.25 billion settlement, to resolve allegations that the opioid manufacturers deceptively marketed opioids by downplaying the risks of addiction and overstating their benefits. California’s shares of the settlements are $205 million and $375 million, respectively.
Pharmacies CVS and Walgreens have also committed to moving forward with national settlements, to the tune of $5 billion and $5.7 billion, respectively, to resolve claims that the companies ignored signs of prescription abuse and failed in their responsibility to prevent drug diversion. If approved, California stands to receive $470 million from the CVS settlement and up to $510 million from the Walgreens settlement. There is a Walmart settlement also in the works.
“We’ve made historic strides forward in our fight for justice and relief for Californians hurt by the opioid crisis,” said Attorney General Bonta. “Nothing can bring back the lives lost or erase the suffering caused by this crisis, but we are making sure those who caused it and profited from it are held to account for their greed and willful misconduct. These hard-fought and hard-won settlement funds will be critical in supporting victims and getting them the help they need to recover. I am proud of the work put in by my team and by our partners across the nation in making these wins possible.”