Walgreens to pay $595M settlement in COVID-19 testing contract dispute

Walgreens has agreed to pay $595 million to settle a legal dispute with Everly Health Solutions, formerly known as PNWHealth, over COVID-19 testing services. 

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The settlement resolves all claims related to a breach-of-contract arbitration initiated by the virtual care company in 2022, according to an SEC filing reviewed by Becker’s

The dispute centered on Walgreens’ decision to in-source certain services previously provided by Everly Health Solutions, including test ordering and oversight, without consulting the company. Everly also alleged fraudulent inducement and misappropriation of branding. 

This settlement follows a Delaware federal court ruling that upheld a $988 million arbitration award in Everly Health Solutions’ favor, rejecting Walgreens’ argument that the damages should have been capped at $79 million under the contract. 

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