McKinsey & Company agrees to pay $650 million to settle federal probe over opioids work
WASHINGTON — McKinsey & Company consulting firm has agreed to pay $650 million to settle a federal investigation into its work for opioids manufacturer Purdue Pharma, according to court papers filed in Virginia on Friday.
As part of the deal with the U.S. Justice Department, McKinsey will avoid prosecution on criminal charges if it pays the sum and follows certain conditions for five years, including ceasing any work on the sale, marketing or promoting of controlled substances, according to the court papers.
A former McKinsey senior partner has also agreed to plead guilty to obstruction of justice for deleting documents from his laptop after he became aware of investigations into Purdue Pharma, according to the filings.
McKinsey representatives didn’t immediately respond to phone and email messages on Friday.
Court filings say Purdue paid McKinsey more than $93 million over 15 years for a number of products, including how to improve revenue from OxyContin.
One of the jobs, the papers said, was to identify which prescribers would generate the most additional prescriptions if Purdue salespeople focused on that. That resulted in prescriptions that “were not for a medically accepted indication, were unsafe, ineffective, and medically unnecessary, and that were often diverted for uses that lacked a legitimate medical purpose,” the filing said.
The company also tried to help Purdue get a say in shaping federal rules intended to ensure the benefits of addictive prescription drugs outweighed the risks. The government said in its new filings that that resulted in making high-dose OxyContin subject to the same oversight as lower-dose opioids and made training for prescribers voluntary rather than mandatory.
Since 2021, McKinsey has agreed to pay state and local governments about $765 million in settlements for its role in advising businesses on how to sell more of the powerful prescription painkillers amid a national opioid crisis.
The consulting firm also agreed last year to pay health care funds and insurance companies $78 million.
The U.S. has been in an addiction and overdose crisis for decades, linked to more than 80,000 deaths in recent years. For the past decade, most of the deaths have been attributed to illicit fentanyl, which is laced into many illegal drugs. Earlier in the epidemic, prescription pills were the primary cause of death.
Some advocates say the crisis was touched off when Purdue Pharma’s OxyContin hit the market in 1996.
Three Purdue executives pleaded guilty to misbranding charges in 2007 and the company agreed to pay a fine. The company pleaded guilty to criminal charges in 2020 and agreed to $8.3 billion in penalties and forfeitures — most of which will be waived as long as it executes a settlement through bankruptcy court that is still in the works.
McKinsey documents made public over the years describe Purdue using the consulting firm to help “turbocharge” opioid sales in 2013, as blowback against the opioid crisis meant that the company’s drugs were being prescribed less.
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Mulvihill reported from Philadelphia.
