Louisiana and CVS Health Reach $45 Million Settlement Over Pharmacy Practices
Louisiana officials have reached a $45 million settlement with CVS Health, resolving a trio of lawsuits brought against the pharmacy chain and its benefits management subsidiary. The agreement stems from accusations of unfair business practices related to pharmacy benefit managers (PBMs) and the use of customer data for political messaging.
Background of the Dispute
The state accused CVS Health of employing “unfair, deceptive and unlawful” tactics by utilizing customer information to launch a text message campaign against proposed legislation concerning pharmacy benefit managers. These PBMs, often described as “middlemen,” play a significant role in determining prescription drug costs for employers and insurance providers by negotiating with drug manufacturers and establishing pharmacy networks. Many major drugstore companies, including CVS, have affiliated PBM components.
Specifically, the lawsuits, filed in June 2025 by Governor Jeff Landry and Attorney General Liz Murrill, targeted three key areas: the improper use of customer information for mass text messages, CVS’s “vertical integration” model (controlling multiple stages of the supply chain), and violations of Louisiana’s Unfair Trade Practices and Consumer Protection Law, potentially disadvantaging independent pharmacies. [Source: lailluminator.com]
The Text Message Campaign and Proposed Legislation
The dispute centered on a bill considered during the 2025 legislative session that would have prohibited pharmacies from too owning PBMs. CVS sent text messages to customers, including First Lady Sharon Landry and Attorney General Liz Murrill, warning that the legislation would force them to close all Louisiana locations. [Source: lailluminator.com] The bill ultimately failed to pass, leading to the lawsuits.
Terms of the Settlement
While CVS Health does not admit any wrongdoing or liability, the $45 million settlement will be allocated to implementing pharmacy benefit legislation and Medicaid fraud initiatives in Louisiana. [Source: yahoo.com] The funds will be used for oversight and to address fraud and abuse activities within the pharmaceutical system, according to Louisiana Health Secretary Bruce Greenstein.
CVS Health’s Response and Continued Investment in Louisiana
CVS Health expressed satisfaction with the settlement, stating it allows the company to focus on lowering healthcare costs and maintaining community pharmacy access in Louisiana. [Source: yahoo.com] Despite past disagreements, CVS Health also announced a $5 million scholarship program for students pursuing a doctor of pharmacy degree at the University of Louisiana at Monroe and Xavier University in New Orleans, an initiative lauded by Governor Landry. [Source: nola.com] The scholarship program is set to begin in the 2026-2027 academic year.
Looking Ahead
While the settlement represents a step towards accountability in pharmaceutical pricing and PBM practices, advocates like Louisiana Progress emphasize the need for broader regulatory reform to address soaring drug costs and prioritize patient care over profits. [Source: yahoo.com]