By Jonathan Stempel
(Reuters) -CVS Health is not entitled to coverage from insurers, including AIG and Chubb, against thousands of lawsuits over its role in the nation’s opioid crisis, Delaware’s highest court ruled on Monday.
The Delaware Supreme Court concluded that governments, hospitals, doctors and benefit plans that sued CVS sought damages for economic losses, not individualized “bodily injury” or “property damage” covered by CVS’s general liability policies.
It also rejected the argument that CVS’ $5 billion nationwide settlement of opioid claims in November 2022 showed that the pharmacy chain and benefits manager had been sued for bodily injury.
“The national settlement agreement funds expenses in response to the opioid crisis at-large, but it does not change the fact that the underlying lawsuits do not seek specific damages tied to individualized injuries,” Chief Justice Collins Seitz wrote for a unanimous court.
CVS said it disagreed with the decision, and that it trains its pharmacists to make the best decisions on patients’ behalf and in compliance with the law.
AIG, Chubb and their lawyers did not immediately respond to requests for comment.
Many insurers have been sued by pharmacy chains, drugmakers and others seeking coverage for opioid-related bills.
Chains had long argued they were merely filling doctors’ prescriptions, but critics said the large quantities being dispensed and the potential for diversion were red flags.
Walgreens and Walmart agreed to pay more than $8 billion in similar settlements.
CVS, based in Woonsocket, Rhode Island, had been appealing two Delaware Superior Court decisions denying insurance coverage in more than 2,300 lawsuits, according to Monday’s decision.
Governments complained about increased spending to treat opioid addiction, hospitals reported strains on their health systems, and third-party payors such as employee benefit funds cited costs of prescription purchases and addiction treatment.
The Delaware Supreme Court ruled in Chubb’s favor in a similar case involving Rite Aid in 2022. CVS claimed that its own policies offered broader coverage, but the court found the policies “similar in all material respects” to Rite Aid’s.
The case is In re CVS Opioid Insurance Litigation, Delaware Supreme Court, No. 482.
(Reporting by Jonathan Stempel in New YorkEditing by Marguerita Choy)
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