Kroger (KR), a leading U.S. supermarket chain, hopes to draw a line under its long-running opioid epidemic litigation scandal after agreeing to pay $110 million to settle a lawsuit brought by the state of Kentucky.
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The deal settles a lawsuit filed last year by Kentucky Attorney General Russell Coleman, which alleged that KR’s pharmacies helped fuel a deadly opioid epidemic by missing red flags on orders of drugs and prescriptions for addictive painkillers. The suit claimed that KR’s Kentucky pharmacies had been responsible for over 11% of all opioid pills dispensed in the state between 2006 and 2019.
As part of the settlement, KR admitted no wrongdoing and denied claims it did not have sufficient guardrails in place around the filling of prescriptions.
“We are pleased to have reached a settlement with the Commonwealth of Kentucky, and we hope the funds will be used to combat opioid abuse in the region,” a KR spokesperson told The Hill.
KR Already Settled Broader Action
The Kentucky case was brought as the state did not take part in a broader lawsuit involving 30 states that eventually saw KR agree to pay a $1.4 billion fine.
Drugmakers, pharmacy operators and a number of other companies have agreed to pay about $50 billion to settle lawsuits relating to the U.S. opioid epidemic. Around 727,000 people died from opioid overdoses in the U.S. between 1999 and 2022, according to the U.S. Centers for Disease Control and Prevention.
KR is also seeking to move on after the collapse of its $25 billion merger with Albertsons (ACI). The company’s next earnings date is expected to be March 6th.
Is KR Stock a Good Buy Now?
Overall, Wall Street has a Moderate Buy consensus rating on KR stock, based on eight Buys, six Holds and no Sells. The average KR price target of $67.38 implies about 14% upside potential from current levels. Shares of KR have risen 30% in the last year.
