Deerfield-based Walgreens Boots Alliance has agreed to pay a $595 million settlement to a virtual care company to a dispute involving COVID-19 testing – evading a $987 million arbitration award, and a federal judge recently said Walgreens must pay.
Just weeks after a federal judge upheld a $987 million arbitration award, Walgreens and virtual care company PWNHealth (now, now economically healthy health) were in court. There was a quarrel in court. A Walgreens spokesman said in a statement at the time that Walgreens would appeal the judge’s decision to rule the ruling. However, the settlement announced late Tuesday will end the matter.
Walgreens “concludes settlement agreements to avoid continued accruals in the arbitration award and the costs and uncertainties of continuing litigation.” Walgreens noted that the settlement does not include recognition of Walgreens (Walgreens) wrongful acts or liability.
Everly did not immediately respond to a request for comment Tuesday afternoon.
Walgreens signed up with PWNHealth for the Covid-19 pandemic when ordering Covid-19 tests, requiring the involvement of doctors. Walgreens uses PWNHealth’s physician network to order tests for clients who use the Walgreens website to schedule appointments, according to court documents. But in 2022, PWNHealth initiated an arbitration claiming that Walgreens violated an agreement between the two companies to use Walgreens and PWNHealth when it began using its own pharmacist after changing regulatory requirements. Site order test without notification of PWNHEADY. In part of the circumstances at the time, Walgreens retained the PWNHealth trademark on its website, PWNHealth said in court filings.
The arbitrators support PWNHealth, which Walgreens challenged in the federal court in Delaware, partly because damages should be limited to $79 million under the contractual agreement. However, the judge supported the arbitrator’s original decision.
Walgreens previously said that if Walgreens appealed the judge’s ruling, the appeal process could take at least two years.
The settlement reached a number of other financial challenges for the retail pharmacy giants related to drug reimbursement, changing consumer habits, and partnerships with primary care provider Villagemd. Walgreens CEO Tim Wentworth said he plans to turn the company around by refocusing on historic work on a retail pharmacy-led business.
Walgreens said earlier this year that it would suspend shareholder quarterly dividends for the first time in 92 years. Last year, Walgreens announced plans to close 1,200 stores over the next three years, including in Chicago. Walgreens has been cutting costs for years, including through layoffs in Illinois and elsewhere.
