In a landmark agreement that further underscores the mounting cost of America’s opioid epidemic, Walgreens has agreed to pay up to $350 million in a settlement with the United States Department of Justice (DOJ) over allegations that the pharmacy chain improperly filled millions of prescriptions for controlled substances.
The settlement, announced on Friday, resolves a long-running federal investigation and brings an end to all opioid-related litigation between Walgreens and federal, state, and local governments. Under the agreement, Walgreens will pay a minimum of $300 million, with an additional $50 million contingent on the company being sold, merged, or transferred prior to 2032.
A Decade of Negligence Alleged
According to the DOJ’s complaint, filed in the Northern District of Illinois earlier this year, Walgreens pharmacists repeatedly filled prescriptions from August 2012 to March 2023 that exhibited clear warning signs—such as unusually large quantities, early refills, or prescribers known for issuing illegitimate scripts.
The government alleged that Walgreens not only failed to prevent the improper distribution of opioids but also actively pressured pharmacists to fill prescriptions rapidly, ignoring red flags and, in some cases, suppressing internal compliance warnings. These actions, the DOJ argued, resulted in a direct violation of the False Claims Act by seeking federal reimbursement for prescriptions that should never have been approved.
Company Responds
Walgreens, while agreeing to the settlement, denied any wrongdoing. “We strongly disagree with the government’s legal theory and admit no liability,” said spokesperson Fraser Engerman. “This resolution allows us to close all opioid-related litigation… while we focus on our turnaround strategy.”
That turnaround may be badly needed. The company announced the closure of 1,200 stores across the United States in October 2024, following falling foot traffic and increased financial pressures, including opioid-related lawsuits. Walgreens’ competitor Rite Aid filed for bankruptcy in late 2023 under similar legal strain.
Compliance and Oversight Measures
As part of the settlement, Walgreens has committed to strengthening its protocols around the dispensing of controlled substances. Agreements with both the Drug Enforcement Administration (DEA) and the U.S. Department of Health and Human Services (HHS) require the company to implement stricter compliance programmes, train pharmacists, improve board oversight, and track prescriptions linked to high-risk prescribers.
“This Department of Justice is committed to ending the opioid crisis and holding bad actors accountable for their failure to protect patients,” said U.S. Attorney General Pamela Bondi. “Pharmacies have a legal responsibility to ensure prescriptions are safe and legitimate—not dispense dangerous drugs just for profit.”
Whistleblowers and Wider Context
The case was driven by four former Walgreens employees who acted as whistleblowers, bringing forward internal evidence of the company’s practices. Their actions follow a broader reckoning within the pharmaceutical and retail sectors, where more than $50 billion in settlements have been reached over the past decade.
In 2022, both CVS and Walgreens paid over $10 billion combined in multistate settlements tied to their roles in the public health crisis. These funds, according to government mandates, are to be used to support prevention, treatment, and recovery programmes in affected communities.
A National Reckoning
“In the midst of the opioid crisis that has plagued our nation, we rely on pharmacies to prevent—not enable—the unlawful distribution of these substances,” said Norbert E. Vint, Deputy Inspector General at the U.S. Office of Personnel Management. “This case is a stark reminder that corporate responsibility must extend beyond profit margins.”
As the retail pharmacy sector grapples with store closures, shifting public trust, and stricter oversight, Walgreens’ latest settlement may serve as both a cautionary tale and a pivotal moment for industry reform.
For further updates on retail regulation, pharmaceutical compliance, and market impact, follow International Supermarket News.
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