CVS Health and its long-term care pharmacy subsidiary, Omnicare, have reached a Justice Department settlement with a $440 million floor.
The settlement would resolve a false claims case that resulted in a nearly $950 million judgment. A jury had previously determined Omnicare was responsible for more than 3.3 million false claims.
According to a July 1 filing in a Texas federal bankruptcy court, CVS would pay the Justice Department $130 million within two weeks of the deal being finalized. Another $310 million would be due March 15, 2028, or guaranteed to be paid by CVS by March 31, 2028, if not paid by the debtors’ estates.
A second agreement with the creditors’ committee releases CVS from potential fraudulent transfer claims tied to a $660 million member distribution Omnicare made to CVS entities in 2023.
“The agreements are not an admission of liability or wrongdoing, and were agreed upon to avoid the time and expense of further litigation. The Omnicare estate and unsecured creditors’ committee agreement resolves mutual claim and distribution issues arising out of Omnicare’s Chapter 11 case,” a CVS spokesperson told Becker’s July 8. “We’re pleased to put this matter behind us as part of a successful conclusion of the Omnicare Chapter 11 case.”
In May, CVS secured court approval to sell Omnicare to GenieRx, an investment firm partnership. The transaction is expected to close later in 2026.
The agreements are conditioned on court approval on or before Aug. 15 and the sale. A hearing is scheduled for Aug. 12.
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