Louisiana Secures $45M Settlement With CVS, Caremark Over PBM Practices

• Louisiana filed 3 lawsuits against CVS Health and its pharmacy benefit manager (PBM) affiliate, CaremarkPCS, alleging deceptive practices, misuse of patient contact information, and anti-competitive conduct affecting independent pharmacies.
• The State claimed CVS’s vertically integrated business model allowed manipulation of pricing, reimbursement structures, and pharmacy network participation in violation of Louisiana law.
• CVS and Caremark agreed to a $45 million settlement resolving the litigation without admitting liability, with funds directed toward oversight and enforcement initiatives.

The Louisiana Attorney General’s Office, led by Attorney General Liz Murrill, announced major legal actions and a subsequent settlement involving CVS Health Corp, its PBM subsidiary CaremarkPCS Health, LLC, and affiliated entities. The matters stem from a series of lawsuits alleging unfair, deceptive, and unlawful practices that harmed Louisiana patients, independent pharmacies, and public interest. This settlement resolves all actions for $45 million without any admission of liability.

In Summer 2025, the State filed 3 separate civil lawsuits in St. Landry Parish against CVS Health and CaremarkPCS. The complaints allege that defendants engaged in a range of practices in violation of Louisiana law, including misuse of customer information, manipulation of drug pricing, and anti-competitive conduct harmful to independent pharmacies. The State sought injunctive relief, restitution, civil penalties, and other remedies to protect the integrity of the healthcare system.

Misuse of Patient Contact Information

Louisiana alleges that CVS used personal contact information—obtained in the course of filling prescriptions and providing pharmacy services—to send mass text messages opposing House Bill 358. According to the complaints, these messages were sent without appropriate authorization and contained misleading claims designed to provoke fear about pharmacy closures, drug access, and job losses if legislative changes regulating PBM ownership of pharmacies passed. The texts were characterized as deceptive and contrary to public policy and standards of decency.

Vertical Integration and PBM Abuse

The State’s filings describe CVS’s vertically integrated business model—combining PBM operations, health insurance functions (including through acquisition of Aetna), pharmacy benefit design, and retail pharmacy services—as a structure that improperly influences drug pricing and reimbursement. The complaints contend this market power has been wielded not to reduce costs or expand access but to manipulate prices, restrict competition, and channel profits internally, obscuring true costs and harming payers, patients, and small pharmacy providers.

Harm to Independent Pharmacies

The third lawsuit targets CVS’s conduct toward Louisiana’s independent pharmacies. The State alleges that defendants imposed unreasonable fees and used their market dominance to subject independent pharmacies to unfair competition. Practices such as spread pricing, excessive fees, and threats of network exclusion were described as deceptive, substantial threats to community pharmacy viability, and violations of the Louisiana Unfair Trade Practices Act.

In early 2026, Louisiana announced a $45 million settlement with CVS Health and its PBM affiliate to resolve all 3 lawsuits. Under the agreement, funds will be directed toward pharmacy benefit legislation implementation, Medicaid fraud initiatives, and collaborative efforts with the Louisiana Department of Health and Inspector General to enhance oversight of pharmaceutical pricing and PBM practices. According to the Attorney General’s office, the settlement was reached to serve Louisiana’s best interests without prolonging litigation, and CVS did not admit wrongdoing or liability as part of the resolution.

• Patient Data Use: The lawsuits spotlight the legal and ethical boundaries surrounding the use of pharmacy customer information, especially for communications beyond clinical and transactional purposes.
• PBM Market Power: Claims of vertical integration and influence over pricing and reimbursement reflect ongoing scrutiny of PBM roles in the drug supply chain and their impact on independent pharmacies.
• Independent Pharmacy Protection: Allegations of unfair competition align with broader concerns about the survival of community pharmacies amid consolidation and dominant PBM influence.

Louisiana’s action against CVS and Caremark represents a substantial legal confrontation over alleged business practices in the pharmacy and PBM sectors. The negotiated settlement resolves complex claims and channels significant funds toward regulatory and public health initiatives. As the pharmacy industry continues to face legal and legislative challenges around data use, pricing transparency, and competition, this case may serve as a reference point for future enforcement and policy developments.

Reference

1. Louisiana AG announces $45 million settlement with CVS. Louisiana Office of the Attorney General. February 20, 2026. Accessed March 4, 2026. https://ag.state.la.us/Article/430
2. Attorney General Liz Murrill announces major legal action against CVS. Louisiana Office of the Attorney General. June 24, 2025. Accessed March 4, 2026. https://aglizmurrill.com/Article/288