Walmart sues government to pre-empt allegations it helped fuel opioid crisis
Walmart Inc. sued the federal government in an effort to preempt regulators’ claims that the retailer added fuel to the U.S.’s opioid crisis by filling suspicious painkiller prescriptions in its pharmacies.
The world’s largest retailer argues in the suit that the U.S. Justice Department and Drug Enforcement Administration is scapegoating the chain to divert attention from the agencies’ failures to effectively address the public-health crisis over opioids.
Watchdog groups have “meticulously cataloged” the ways regulators have “failed to safeguard the public from improper diversion of prescription opioids,” Walmart’s lawyers said in the 54-page complaint. Walmart indicated it sued the government in anticipation of the DOJ filing its own lawsuit alleging the retailer mishandled the highly addictive pills. The company wants a judge to remove “unacceptable uncertainty” about its practices.
A spokesperson for the Justice Department didn’t immediately respond to calls for comment after regular business hours. James Pokryfke, a DEA spokesman, declined to comment. The complaint comes a day after federal prosecutors announced an $8.3 billion deal with drugmaker Purdue Pharma LP under which the company will plead guilty to criminal charges over its marketing of its opioid-based OxyContin painkiller.
Walmart has been promoting its health-services offering in the U.S. — where care is expensive and the insurance system is complex. The company has announced plans to expand its low-cost clinics in Georgia and the Chicago area.
Walmart sued the government in Sherman, Texas — the same district in which federal prosecutors once weighed hitting the chain with criminal charges over its opioid-dispensing practices, according to ProPublica. Joe Brown, the former U.S. Attorney for east Texas, threatened to indict the retailer for intentionally supplying doctor-run pill mills that routinely wrote hundreds of prescriptions for opioid painkillers, according to the report. DOJ officials in Washington nixed the indictments, ProPublica said.
Maureen Smith, a spokesperson for the U.S. Attorney’s office in Sherman didn’t immediately return a call seeking comment. Brown, who stepped down in May, didn’t return a call and email seeking comment. The Wall Street Journal reported earlier on the suit.
Walmart has been sued by more than 2,000 states, cities and counties seeking to recoup billions in tax dollars spent battling the fallout from the opioid crisis. The retailer, along with pharmacy chains, was set to face a federal trial in Cleveland over its opioid handling, but the case was delayed by the Covid-19 outbreak.
Local government officials claim Walmart and companies such as CVS Health Corp., Walgreens Boots Alliance Inc.and Rite Aid Corp intentionally turned a blind eye to suspiciously large opioid prescriptions to ramp up billions in profits.
In its suit, Walmart said it has a robust system for monitoring opioid prescriptions and federal regulators are making unreasonable demands on the chain.
“DOJ and DEA are placing pharmacists and pharmacies in an untenable position by threatening to hold them liable for violating DOJ’s unwritten expectations for handling opioid prescriptions—expectations that are directly at odds with state pharmacy and medical practice laws,” the company said.
The case is Walmart Inc. v. U.S. Department of Justice, 20-cv-00817, U.S. District Court, Eastern District of Texas (Sherman).(Updates with details on opioid suits against Walmart starting in eighth paragraph)
–With assistance from Chris Strohm and Laurel Calkins.
More must-read finance coverage from Fortune:
- What Wall Street needs from the 2020 election
- Tom Steyer thinks business is missing a big opportunity—and that Trump has done “nothing but whiff”
- Can an A.I. algorithm help end unfair lending? This company says yes
- Procter & Gamble shows that increasing spending during a recession is worth it
- Stocks in “election-sensitive” sectors seem oblivious to which candidate wins. Why?