Walgreens To Pay $230 Million Settlement to San Francisco for Contributing to Opioid Epidemic

San Francisco reached a $230 million settlement with Walgreens on Friday over the companies role in the opioid crisis in the city, completing a District Court case last year that had found Walgreens guilty.

The city, like many areas of the country, has been devastated by opioids for years. Fentanyl in particular has caused hundreds of deaths a year in the city and has been a contributing factor to San Francisco’s crime wave. In the first three months of 2023 alone, 200 fentanyl-related deaths were recorded, a huge jump from 142 deaths duriing the same period in 2022. The city subsequently has sued all opioid drug makers in the U.S., and before Tuesday, had reached large settlements with companies such as Purdue Pharmaceuticals, Johnson & Johnson, AbbVie, and Teva. Teva alone paid over $24 million to the city last year, as well as an additional $20 million for supplying the city with the overdose reversal drug Narcan.

However, in addition to the drug makers, San Francisco also went after pharmacies for their role. Starting in 2018, the city sued several, include Walgreens. In August of last year, U.S. District Judge Charles Breyer ruled in favor of San Francisco, finding that the company didn’t properly investigate opioid orders for over a decade.

“Walgreens’ pharmacists filled hundreds of thousands of suspicious opioid prescriptions from 2006 to 2020 with pharmacists not given time, staffing or resources to properly investigate red flags,” said Judge Breyer last year. “Walgreens’ failures played a substantia  role in a crisis that has had catastrophic effects on the city, overwhelming hospitals and devastating neighborhoods.”

In a statement after the trial, San Francisco City Attorney David Chiu added that “This decision gives voice to the thousands of lives lost to the opioid epidemic. This crisis did not come out of nowhere. It was created by the opioid industry, and local jurisdictions like San Francisco have had to shoulder the burden for far too long. We are grateful the Court heard our arguments and held Walgreens responsible for the damage they caused.”

Despite the ruling, the ruling on how much the company should pay was moved to a later court date this year. With the court date ruling, and worse news on how the crisis has affected San Francisco coming out each day, Walgreens quickly worked with the city for a settlement. On Wednesday, both sides finally reached an agreement, with Walgreens to pay San Francisco $230 million. While the company expressed sympathy for those affected by the crisis, they also said that they were not liable for the crisis and did not admit fault.

San Francisco, Walgreens reach settlement

Chiu and other city leaders gave a press conference on Wednesday on the settlement. Officials noted that the $230 million settlement was far below their originally asked amount, $8.1 billion, to fight the opioid crisis in the city. They also noted the payments from the company will come in stages over the next eight years, with $57 million to be paid by June 2024, and the rest due in full by 2030.

“Extremely dangerous and addictive opioids were marketed to patients as safe. We now know that was a blatant lie,” noted Chiu in front of San Francisco City Hall on Wednesday. They were more concerned with profit than following their legal obligations, pressuring their pharmacists to fill, fill, fill.”

San Francisco Department of Public Health Director Dr. Grant Colfax added that “We have seen the devastating impacts of opioid addiction in our most vulnerable communities and this decision is an important step forward in our efforts to save lives.”

Legal experts noted that San Francisco was actually lucky to get the $230 million through the settlement, as previous city cases elsewhere in the U.S. had been settled for far less.

“San Francisco lucked out,” explained legal advisor William Bell, who has been part of consultant teams in drug trials in the past, to the Globe on Wednesday. “The city has made national and international news on the drug problem there in recent years, so San Francisco’s growing problems put more pressure on Walgreens to pay. There was no way they were getting billions for this, but it was always likely that over $100 million was in the cards. But with the city’s problems becoming more and more worse, Walgreens settled before a court could be affected by that and give an even bigger payday to the city.”

It is currently unknown how the first $57 million will be divided by the city next year, although the Department of Public Health is likely to get a fairly large portion.