US Opioid Crisis: CVS Health Agrees To $5 Billion Settlement of Nationwide Lawsuits

CVS Health has announced an agreement, in essence, to settle lawsuits concerning the way it handled prescriptions for potent and addictive opioid medicines connected to an overdose epidemic.

If the deal is approved, per AP News, the Woonsocket, Rhode Island, corporation will pay approximately $5 billion over ten years, making it one of the largest settlements reached during the crisis.

Other pharmacies, Rite Aid, Walgreens, and Walmart, have agreements with specific states regarding the US opioid crisis.

CVS revealed the planned merger the same day the company released its quarterly earnings on Wednesday. The corporation denied any misconduct or responsibility and said other matters have yet to be settled.

Thomas Moriarty, CVS's chief policy officer, and general counsel, said in a statement that the company is "delighted" to conclude the longstanding suits and move forward for the benefit of all parties.

"We are committed to working with states, municipalities, and tribes, and will continue our own important initiatives to help reduce the illegitimate use of prescription opioids," the CVS official stated.

As part of its efforts to lessen opioid misuse, the firm has started educational campaigns and placed drug disposal machines in retailers and law enforcement agencies.

Governments filed lawsuits claiming pharmacies filled prescriptions that should have been flagged as questionable.

What Will CVS Do Next?

During the next decade, CVS will fork over $4.9 billion to state and local governments and around $130 million to Native American tribes as part of the settlement agreement. The precise sum is contingent on the number of government agencies that sign on to the arrangement.

With this proposed settlement, the total amount paid out in completed and finalized settlements among companies and governments across the country will exceed $45 billion. The majority of the funds are required to be put toward curing the epidemic, as stated in the agreements.

According to federal figures, the opioid crisis has caused about 650,000 overdose deaths since 1999 and is becoming worse. The money from the settlements will be used to tackle the US opioid crisis, per Reuters.

Companies aggressively advertised opioids as a safe approach to treat all types of chronic pain in the 1990s.

During the COVID-19 epidemic, opioid overdoses increased by 38% in 2020 and 15% in 2021, according to the US Centers for Disease Control and Prevention.

Officials believe that the illicit production of fentanyl, a potent synthetic opioid, is to blame for the current uptick in overdose cases.

CVS Health Tops 3rd Quarter Wall Street Predictions

In a related update, CNBC reported that CVS Health said Wednesday morning that its earnings for the third quarter topped Wall Street forecasts.

According to Refinitiv, CVS Health's performance was as follows: Dividends of $2.09 per share, up from the predicted $1.99.Sales of $81.16 billion compared to the predicted $76.75 billion. CVS has now exceeded earnings estimates for three consecutive quarters. Annual sales were up 10%.

CVS' Health Care Benefits business climbed over 10% compared to the same quarter last year, fueled by a rise in 2021 medical memberships.

Gains were offset by a decrease in Covid vaccines, although overall revenue from pharmacy services climbed by nearly 10% compared to the same time the previous year.

While sales increased by about 7% in the retail and long-term care sectors, profits fell nearly as much as declining demand for COVID-19 testing and vaccinations accounted for much of the fall in profitability.

CVS offers prescription and over-the-counter medicines, MinuteClinic patient care, and CVS Caremark pharmacy benefit management. Their portfolio also includes the managed health insurance provider Aetna.