WASHINGTON – Global consulting firm McKinsey will pay US$573 million (RM2.3 billion) to states in the United States to settle claims it contributed to the country’s deadly opioid crisis through its advice to pharmaceutical giants, including OxyContin manufacturer Purdue Pharma.
The settlement is rare in the history of the massive firm that advertises its ability to solve problems worldwide, but has found itself accused of having a hand in creating a massive public health crisis in the US.
Under the terms of the settlement announced yesterday, McKinsey will not admit fault, and the agreement protects the company from future civil claims from the states involved.
However, the company will have to halt consulting work on some narcotics, implement a new ethics code, and release documents related to their work with Purdue Pharma while ensuring none are destroyed, said New York Attorney-General Letitia James, who announced the settlement.
“Under the terms of today’s agreement, the company will finally end its illegal conduct, deliver more than half a billion dollars into communities across the nation, and will never be able to help perpetrate this type of fraud and deception again.”
New York is among the group of 47 states, five territories and the Columbia District that sued the firm over its work with Purdue Pharma, which last year pleaded guilty to criminal charges over the production and sale of prescription opioid OxyContin.
Deadly consequences
McKinsey announced it had fired two of its partners who discussed destroying documents amid the probe.
“We deeply regret that we did not adequately acknowledge the tragic consequences of the epidemic unfolding in our communities,” its global managing partner, Kevin Sneader said.
“With this agreement, we hope to be part of the solution to the opioid crisis in the US.”
McKinsey advised Purdue on how to “turbocharge the sales engine” of the drug by up to US$400 million per-year, according to a Massachusetts suit, by emphasising that the opioid could reduce stress and make users more optimistic.
The New York Times reported that McKinsey consultants also worked with Purdue Pharma to counter “the emotional messages from mothers with teenagers that overdosed” on OxyContin.
Almost half a million Americans died in overdoses from both prescription and illegal opioids between 1999 and 2018, according to the Disease Control and Prevention Centres.
Authorities said the opioid crisis has driven the first significant reduction in US life expectancy since the 1990s as a result of the AIDS epidemic.
“McKinsey’s cynical and calculated marketing tactics helped fuel the opioid crisis by helping Purdue Pharma target those doctors they knew would overprescribe opioids,” James said.
She said proceeds from the settlement, which the Times reported exceeds any profit the firm made from its work with pharmaceutical giants, will go towards opioid addiction prevention and recovery programs.
In a nod to similar provisions in agreements with tobacco companies over the harm their products caused, the settlement also mandates that McKinsey set up a database accessible to the general public that includes most of the internal documents related to its work on the drugs. – AFP, February 5, 2021
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