KEY TAKEAWAYS: Louisiana reaches $45 million settlement with CVS Health over three lawsuits State alleged improper text campaign and unfair PBM business practices Funds will support pharmacy benefit legislation and Medicaid fraud oversight CVS denies wrongdoing but agrees to settlement to reso lve dispute   Louisiana officials have reached a $45 million settlement with CVS Health over a trio of lawsuits the state brought against the national pharmacy chain and its benefits management subsidiary. The state had accused CVS Health of “unfair, deceptive and unlawful” business practices for using customer information to conduct a text message campaign last year against proposed legislation for pharmacy benefits managers. Gov. Jeff Landry‘s administration has blamed pharmacy benefits managers for high prescription drug prices and stacking the deck against small, independent pharmacies. Known in health care policy circles as PBMs, these “middlemen” companies work with employers and insurance providers to determine what consumers pay for prescription drugs. Their go-to business model is to negotiate with drugmakers to provide rebates and build pharmacy networks for their clientele. Most major drugstore companies have an affiliated pharmacy benefit management component. Caremark, a CVS subsidiary, is the pharmacy benefit manager for the state Office of Group Benefits, which provides prescription coverage for most state employees and public school teachers. A bill before lawmakers in the 2025 session would have prohibited pharmacies from also owning pharmacy benefit managers. In its text message, CVS said it would have needed to close all of its Louisiana locations if the proposal became law. Lawmakers ultimately shelved the bill in favor of an alternative transparency measure, leading Landry to consider calling a special session to enact stricter laws for pharmacy benefit managers. Attorney General Liz Murrill instead filed three lawsuits against CVS Health last June in St. Landry Parish. The first involved what she said was the improper use of customer info for mass text messages. The second targeted the CVS “vertical integration” model that gives it control of multiple stages in the supply chain. In the final lawsuit, Murrill accused the corporation of violating Louisiana’s Unfair Trade Practices and Consumer Protection Law, to the disadvantage of the state’s independent pharmacies. “These cases involved conduct directly impacting Louisiana citizens,” Murrill said in a statement. “Rather than prolonging litigation, which could have extended several years, we worked with CVS to reach a resolution that serves the best interests of Louisiana. The funds will be used to further ensure accountability in pharmaceutical pricing and PBM industry practices.” The settlement will be used to “implement pharmacy benefit legislation and Medicaid fraud initiatives in collaboration with the Inspector General and the Louisiana Department of Health,” according to the attorney general. In reaching the settlement, CVS Health does not admit to any wrongdoing or liability, Murrill said. “We’re pleased that we’ve reached a settlement agreement with the Louisiana Attorney General‘s Office,” CVS Health communications director Amy Thibault said in an email. “The settlement enables us to maintain our focus on lowering health care costs and providing community pharmacy access to Louisiana residents and is not an admission of liability or wrongdoing.” In an interview Friday, Louisiana Health Secretary Bruce Greenstein shed some light on how his agency would use its portion of settlement dollars. He said he was glad CVS Health and the attorney general worked through their differences to change what he called unfair business practices. “We know that regulating and overseeing PBMs is not a simple task, so monies that come to the department will be used for oversight. They will be abused for fraud and abuse activities,” Greenstein said. Peter Robins-Brown, who leads the citizens’ advocacy group Louisiana Progress, said while the settlement is good news, soaring drug prices remain a pressing issue for the state’s poor and working class. “Capping or lowering those costs will require more aggressive regulatory reform for all of the actors in America’s multibillion-dollar drug cartel system—Big Pharma, insurers and distributors — who often prioritize profit over patient care and access,” Robins-Brown said. ...read more read less