Walgreens has agreed to a $100 million settlement to resolve claims from consumers and unions that it overcharged insured customers for prescription drugs while allowing members of its Prescription Savings Club to pay significantly less. The settlement, filed in Illinois federal court on Friday, seeks preliminary approval to conclude the case, which involves allegations of fraud, unjust enrichment, and violations of state consumer protection laws.
Details of the Settlement and Consumer Claims
The lawsuit, initially filed in 2017, accuses Walgreens of manipulating prescription drug pricing by failing to report lower prices from its Prescription Savings Club as the “usual and customary” rates when calculating costs for insured customers. Instead, Walgreens allegedly charged insured consumers more than club members, who paid flat-rate, discounted prices for generic medications.
In the court filing, plaintiffs praised the $100 million settlement as “an excellent result for the settlement class,” recognizing the challenges and complexities involved in continued litigation. Along with the payout, Walgreens has agreed to close its Prescription Savings Club, which offered discounted rates to uninsured members.
Class Members and Compensation Structure
The proposed class for the settlement includes all individuals who used insurance to pay for Walgreens prescriptions dating back to January 1, 2007. According to the filing, class members will receive compensation based on an estimate of their spending on eligible prescriptions at Walgreens. The class is expected to encompass millions of individuals and thousands of benefit providers, reflecting the extensive reach of Walgreens’ pricing practices over the years.
Walgreens To Pay $100M In Suit : Background of the Case and Legal Proceedings
Walgreens previously attempted to dismiss the lawsuit in 2017, but a federal judge largely rejected its motion in 2018. U.S. District Judge John Z. Lee found that the plaintiffs presented sufficient evidence to support claims that Walgreens listed higher “usual and customary” prices for insurance providers, despite offering lower prices to members of its Prescription Savings Club.
