CHARLESTON, W.Va. (WVDN) – West Virginia Attorney General Patrick Morrisey on Thursday announced a settlement has been reached between his office and Kroger for $68 million. The pharmacy chain was the last remaining defendant in a lawsuit involving Walgreens, Walmart, CVS and Rite Aid.
The settlement with Kroger resolves the lawsuit that alleged the pharmacy chain failed to maintain effective controls as a distributor and dispenser against diversion that contributed to oversupply of opioids in the state.
“Let this be a warning to others: We fight hard for those affected the most by the opioid epidemic and will stop at nothing in getting justice for them,” Morrisey said. “West Virginia remains on top in settlement dollars per capita. And although the hundreds of millions of dollars we secured from these companies will not bring back the lives lost from the opioid menace, our hope is that the money would provide significant help to those affected the most by this crisis in the state.”
Kroger has agreed to pay $34 million upfront per the settlement agreement, then $12 million on June 30, 2024, another $12 million on June 30, 2025, and then lower additional payments over the next seven years to reach the $68 million total.
The deal also comes with a 2.94% Most Favored Nation protection — a guarantee that West Virginia won’t be prejudiced by a future national settlement.
As far as the other pharmacy chains in the lawsuit, Walgreens settled in January for $83 million.
Walmart and CVS settled with the state last September: Walmart agreed to a settlement of $65,070,000; CVS for $82.5 million.
Last August, Rite Aid settled for up to $30 million to resolve similar litigation.
The lawsuits allege the pharmacies’ contribution to the oversupply of prescription opioids in the state have caused “significant losses through their past and ongoing medical treatment costs, including for minors born addicted to opioids, rehabilitation costs, naloxone costs, medical examiner expenses, self-funded state insurance costs and other forms of losses to address opioid-related afflictions and loss of lives.”
The money from all opioid settlements will be distributed under the terms of the West Virginia First Memorandum of Understanding which allows for the creation of the West Virginia First Foundation.
In March, Gov. Jim Justice signed SB 674, which recognizes the Foundation and authorizes the governor to make appointments to its board of directors with the advice and consent of the Senate.
As a private, nonstock, nonprofit group, the Foundation will distribute any settlement or judgment funds awarded from litigation for abatement purposes—it will be pursuant to the terms of the MOU.
As the central organization dedicated to addressing the opioid crisis throughout the state, the Foundation will receive 72.5% of each settlement or judgment, 24.5% of settlement and judgment dollars will be allocated to local governments and 3% will be held in escrow by the state.
This allocation maximizes the amount of money that will be available for an opioid abatement fund and will distribute money throughout the state. This distribution will allow the money to help people and fund projects most in need.
The Foundation will be managed by a board of 11 members, five of whom will be appointed by the governor, subject to confirmation by the Senate. To represent the interests of local governments, the MOU establishes six regions, and one member will be chosen from each of those regions.
An executive director will run the day-to-day operations of the foundation.
So far, all 55 counties and 220 of 229 cities and towns have signed on to the MOU.
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