CVS and Walgreens have agreed to a $10 billion settlement with state and local governments accusing them of mishandling prescription painkillers and fueling the US opioid crisis. They each would pay roughly $5 billion. Walmart, too, is reportedly ready to settle, to the tune of $3 billion.
The settlement amounts still require formal approval, but they’re a good indication of how much the pharmacy chains will have to pay. Earlier this year, the Sackler family—the owners of Purdue Pharma, the manufacturer of the blockbuster opioid drug OxyContin—reached a $6 billion settlement agreement after a federal judge rejected an initial settlement of $4.5 billion.
The latest round of settlements all but ends the big lawsuits brought against a dozen companies accused of precipitating what is arguably the worst addiction epidemic in American history. Drug distributor McKesson settled for the largest amount ($7.4 billion). Overall, the settlements add up to $53 billion.
That’s still less than $206 billion paid by tobacco companies sued over the health costs of treating smoking-related illnesses—and a tiny fraction of the estimated $1 trillion a year that the opioid crisis is currently costing the US.
The lawsuits might be over, but the opioid crisis is worse than ever
A combination of the growing numbers of people buying illegal opioids, and the ubiquity of fentanyl have driven up overdose deaths in the US to unprecedented levels. In 2020, 92,000 people died of drug overdoses. Opioids accounted for nearly 70,000 of those, up from 50,000 in 2019. Estimates for 2021 put overall overdose deaths at 103,000, with at least 82,000 tied to opioids.
What the opioid crisis is costing the US
The costs of such a monumental crisis are hard to estimate. The most recent estimate from the Centers for Disease Control and Prevention (CDC) says the crisis cost over $1 trillion a year, between the loss of life, expenses for medical treatments, and spending on criminal justice.
But that cost estimate is from 2017, when only 2 million Americans had an opioid-use disorder, and 48,000 died from an overdose because of it. In 2021, the number of patients with an opioid addiction is at least 3 million, and deaths reached 82,000. This makes the current epidemic at least 50% larger than it was in 2017, which would bring up the yearly cost estimate to $1.5 trillion, in line with recent cost estimates from the US Congress Joint Economic Committee.
That would mean the total amount paid in the settlements cover about 0.3% of the bill for one year only. Altogether, the 12 major companies involved in the settlements had total revenues of $1.8 trillion in 2021.