Walgreens Boots Alliance, facing mounting financial obligations from opioid litigation and other legal matters, is laying off 504 corporate employees.
Spokesman Marty Maloney confirmed the layoffs Thursday, saying most of the cuts will be made at the drug giant’s Deerfield headquarters or its Chicago office. He said the layoffs represent about 10% of his corporate workforce.
“None of these roles are based in our stores, micro-fulfillment centers or call centers. We are grateful for the many contributions from team members who will be leaving our organization and are committed to supporting them as much as possible during this transition,” Maloney said.
He denied that the layoffs are related to the company’s financial liabilities. He reported an after-tax charge of $5.4 billion to cover opioid claims and litigation for the six months ending February 28. In its settlements, the company has denied responsibility regarding allegations of its role in the opioid crisis.
Earlier this month, he reached a settlement with San Francisco, agreeing to pay the city $230 million for its opioid sales.
Last week, Walgreens challenged a $642 million arbitration award for health insurance provider Humana in federal court in a dispute over drug prices. Walgreens called the sum “staggering.”
CEO Rosalind Brewer said in a message to employees, obtained by the Sun-Times, that the layoffs are among a series of steps the company is taking “to drive sustainable cost savings to help drive investment for the future.” future growth”. Brewer did not refer to legal issues.
He cited other cost-saving measures Walgreens has implemented, such as “consolidating our office space in the Deerfield building, reducing consultant and contractor expenses, eliminating non-essential projects, minimizing travel and canceling some events.”
He thanked the workers for their contributions and said: “While difficult, these changes are necessary to optimize our business, create value and support our long-term growth. Together, we will continue to advance our vision of being the leading partner in reinventing local healthcare and wellness for all.”
Walgreens has evolved beyond its pharmacies to become a direct health care provider through the Walgreens-backed VillageMD, which purchased Summit Health.
Brewer said laid-off workers will have mental health and counseling services available at the company.
Maloney verified Brewer’s memo as authentic. He said Walgreens is committed to maintaining offices in Deerfield and Chicago.
Maloney said that all affected employees will have relocation support. He said compensation is being offered, but declined to share the terms. Posts on TheLayoff.com blog said that workers with at least three years of service received two weeks’ severance pay per year.