Walgreens Settles Class Action Lawsuit

Walgreens has agreed to pay over $100 million to settle a class action lawsuit alleging that the pharmacy fraudulently overcharged patients who bought generic drugs through private insurance, Medicare, or Medicaid.

The Allegations

The claims against Walgreens span over a decade. The pharmacy was accused of requiring insured patients to pay more than members of its Prescription Savings Club for generic medications. For a small annual fee, Prescription Savings Club members could purchase over 500 commonly prescribed generic drugs for $5, $10, or $15 for 30-day prescriptions, and $10, $20, or $30 for 90-day prescriptions. Insured patients, however, ended up paying more between copays and deductibles. The lawsuit argued that patients with health insurance reasonably believed that they would pay the same—or less—than a cash-paying patient.

The lawsuit requested damages for insured patients nationwide dating back 2007, when the Prescription Savings Club began. Plaintiffs argued that Walgreens inflated copayments, coinsurance, and deductibles through an improper pricing scheme.

The Settlement

In November 2024, Walgreens agreed to a $100 million settlement after more than 7 years of litigation. Walgreens consistently denied any wrongdoing, but ultimately chose to resolve the case. As part of the settlement, the pharmacy chain also agreed to terminate the Prescription Savings Club program.

The settlement class includes all individuals in the US who used prescription insurance benefits to fill a prescription at Walgreens from January 1, 2007 to December 31, 2024.

In a statement, a Walgreens spokesperson said, “We admit no liability and believe these claims never had any merit. This resolution allows us to focus on our turnaround strategy that will benefit our patients, customers, team members and shareholders.”

Lawyers for the plaintiffs have filed for federal approval of the settlement, calling it an “excellent result” for the class of plaintiffs. In late November, an Illinois federal judge granted preliminary approval of the deal.

Reference

Russo et al v Walgreen Co. No. 1:17-cv-022246. United States District of Court Northern District of Illinois Eastern Division; 2024. https://www.classaction.org/media/russo-et-al-v-walgreen-co-et-al-preliminary-approval-order.pdf