CVS Health has announced it has reached a $5 billion settlement over its role in the opioid crisis. Under the deal announced Wednesday, CVS would pay $4.9 billion to state and local governments and about about $130 million to Native American tribes over the next decade.
The $5 billion figure would make the settlement, if accepted, one of the largest opioid-related settlements ever. It would also make CVS the first major pharmacy chain to reach a nationwide settlement of lawsuits over the crisis. Other pharmacies, including Rite Aid, Walgreens and Walmart have reached agreements with individual states.
“We are pleased to resolve these longstanding claims and putting them behind us is in the best interest of all parties, as well as our customers, colleagues and shareholders,” CVS Health Chief Policy Officer and General Counsel Thomas Moriarty said in a statement. “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.”
In a press release on the settlement, CVS said the settlement “is not an admission of any liability or wrongdoing” regarding the opioid crisis. The company added it “will continue to defend against any litigation that the final agreement does not resolve.”
CVS announced the settlement the same morning the company released its third quarter earnings. While CVS reported a loss of $3.9 billion, that actually beat expectation, as the company had set aside $5.2 billion for “opioid litigation charges.” Meanwhile, CVS saw sales growth in all three of its main businesses as total revenue climbed 10% to $81.2 billion.
“We delivered another outstanding quarter, and have raised full-year guidance as a result,” CVS Health President and CEO Karen Lynch said in a statement. We continue to execute on our strategy with a focus on expanding capabilities in health care delivery, and the announced acquisition of Signify Health will further strengthen our engagement with consumers.”
The company now expects adjusted earnings of $8.55 to $8.65 per share for the year, a higher and narrower forecast than it made in August. FactSet says analysts predict, on average, earnings of $8.55 per share.
