Walgreens to Pay San Francisco $230 Million for Role in Opioid Crisis

Walgreens will pay San Francisco nearly $230 million over 14 years as part of a settlement agreement over the pharmacy giant’s role in the opioid epidemic, city officials announced Wednesday.

The settlement stems from landmark litigation San Francisco brought against Walgreens in 2018, and comes as part of a larger legal effort against the drug industry for fueling the opioid industry.

“Opioids have wreaked havoc across our nation, leading to immense suffering and untold damage,” said City Attorney David Chiu. “This historic agreement ensures Walgreens is held accountable for the crisis they fueled and our city receives appropriate resources to combat the opioid crisis and bring relief to our communities.”

Although Walgreens will pay the settlement over 14 years, the bulk of the funding will be released sooner: Up to $57 million will be available in the city’s current budget cycle — part of $175 million San Francisco should receive by 2030, Chiu said.

“While we are grateful for the funding secured in this lawsuit, it won’t replace the thousands of lives lost to the opioid epidemic that is playing out across our country. Lives are being devastated, particularly with the rise of fentanyl, and cities are being left to respond to what is a generational crisis,” said San Francisco Mayor London Breed. “We will incorporate the plans to use this funding in our upcoming budget, which is currently being finalized and must be submitted to the Board of Supervisors by the end of the month. I look forward to working with the board members on this as part of our overall budget process.”

The litigation will now be dismissed, and Breed and the Board of Supervisors must next approve the settlement agreement.

Since 2018, San Francisco has sued multiple opioid manufacturers, distributors and dispensers, and Walgreens was the last defendant to reach a settlement agreement with the city. In total, San Francisco stands to receive $352 million over the next 15 years.

In April, the city settled lawsuits over Walmart’s and CVS Pharmacy’s alleged negligent oversight of opioid prescription practices; San Francisco is slated to receive up to $18.8 million from those settlements. In 2022, the city attorney’s office secured a $10 million settlement from Endo, a pharmaceutical company, and $54 million from drug manufacturers Allergan and Teva. And, the city approved a $45 million settlement with Johnson & Johnson, which manufactures opioids, and distributors including Cardinal, AmerisourceBergen and McKesson.

“The evidence at trial established that from 2006 to 2020, Walgreens pharmacies in San Francisco dispensed hundreds of thousands of red-flag opioid prescriptions without performing adequate due diligence,” said presiding judge Charles Breyer of the U.S. District Court of the Northern District of California. “Tens of thousands of these prescriptions were written by doctors with suspect prescribing patterns.”

The funds are said to be earmarked for overdose prevention, such as distributing Narcan, a nasal spray or injectable that can reverse an opioid overdose.

Advocates for overdose prevention have also called for the millions of dollars in opioid litigation settlements to be used for safe consumption sites, facilities where people can consume illicit substances under medical supervision. The idea is to have trained staff available to reverse an overdose if one takes place, and work with drug users to connect them to other health and social services. It also gives drug users a safer place to be rather than the street.

Supervisor Hillary Ronen said she is advocating for a portion of the settlement funds to cover overdose prevention services at “wellness hubs” the city plans to open in the Tenderloin, Mission and South of Market neighborhoods. She said she would also like to see the funding used to hire case managers who could do proactive outreach and trust-building with hard-to-reach people living on the street and experiencing substance use disorder.

Chiu said he supports safe consumption sites as a tool to combat overdoses, but has not agreed to use the opioid litigation funds for the sites because of legal disagreements over whether this would run afoul of state and federal law.

In 2022, Gov. Gavin Newsom vetoed a bill that would have allowed San Francisco to pilot safe consumption sites, which are used in more than a dozen countries around the globe.

Rhode Island passed a similar bill, and is now planning to open a site in 2024 that would use some of that state’s funding from similar opioid litigation wins.

Meanwhile, New York City has been operating a safe consumption facility using a model that doesn’t rely on public funding — but long-term financing is an ongoing challenge. Staff at the site, run by the nonprofit OnPoint NYC, have reversed more than 800 overdoses, executive director Sam Rivera told Politico earlier this month. New York City Mayor Eric Adams has said he is looking to expand the model.

“I have been a long-time supporter of the possibility that San Francisco should consider safe consumption sites,” Chiu said. “In New York, there has been a nonprofit that has moved forward with safe consumption sites without city staff, funding or property. I think that would be appropriate for us to do here in San Francisco, but those conversations continue.”

But local nonprofits in San Francisco that want to operate safe consumption services say they will be hard to fully fund without support from the city’s opioid litigation funds.

Chiu said his office is in conversation with leaders in Rhode Island, but he stressed that Newsom’s veto in 2022 makes the situation harder here in San Francisco.

“Rhode Island is the only state in the country where the state legislature passed a law signed by the governor that would permit safe consumption sites,” he said. “That’s not the case here in California.”