Walgreens pays $100 million to settle class action drug lawsuit

Walgreens will pay $100 million to settle a seven-year-old class action lawsuit alleging the company inflated drug prices.

Walgreens denies wrongdoing.

The class action lawsuit, Russo v. Walgreens Co., dragged on for more than seven years in “hard-fought litigation,” according to court documents.

WHY THIS IS IMPORTANT

Walgreens did not consider the prices it charged under its Prescription Savings Club when determining its usual and customary price, which resulted in insured consumers and third-party payers paying more for their prescription drugs, according to the settlement announced Nov. 1 was filed in Northern federal court. District of Illinois, Eastern Division.

Walgreens said it acted appropriately in reporting its retail prices.

Walgreens was accused of requiring insured customers to pay more than members of the Prescription Savings Club, who for a low annual fee could purchase more than 500 commonly prescribed generic drugs for $5, $10 and $15 for 30-day prescriptions, and $10, $20 and $20. $30 for 90-day prescriptions without using insurance, according Reuters. Insured customers reasonably believed they would pay no more than customers who paid out of pocket, but they did end up paying more in copays and deductibles.

The lawsuit alleged that the prices Walgreens reported to insurers for reimbursement were inflated.

One condition of the settlement was that Walgreens would terminate the savings club, which it did in August, according to Reuters.

THE BIG TREND

Walgreens in September agreed to pay The Justice Department says it needs $106.8 million to resolve allegations that it is billing the government for prescription drugs that were never dispensed.

The government alleges that between 2009 and 2020, Walgreens submitted false claims for payment to Medicare, Medicaid and other federal health care programs for prescriptions it processed but were never picked up by beneficiaries. As a result, Walgreens received tens of millions of dollars for prescriptions it never actually dispensed, the DOJ said.

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