Corporate executives caught up in the opioid crisis are rarely prosecuted: NPR

Global consulting firm McKinsey & Company agreed Friday to pay $650 million to resolve a federal investigation into Purdue Pharma’s role in “spiking” sales of the highly addictive opioid painkiller OxyContin. The U.S. Department of Justice announced Friday.

Federal officials said the influential consulting firm, which often advises governments and powerful companies around the world, committed the crime by aggressively trying to expand sales of opioids.

“This was a strategy, it was implemented, and it worked,” U.S. Attorney Christopher Kavanaugh said at a press conference Friday. “McKinsey’s strategy resulted in unsafe and medically unnecessary OxyContin prescriptions.”

Kavanaugh said Martin Elling, a former senior partner at McKinsey, “personally deleted various Purdue-related electronic materials from his McKinsey laptop for the purpose of obstructing future investigations.”

Justice Department officials said Mr. Elling has agreed to plead guilty to a felony charge of obstruction of justice for destroying those company records.

The settlement stems from charges brought by the U.S. Attorney’s Offices in Virginia and Massachusetts.

McKinsey’s payments include $2 million paid to the Virginia Medicaid Fraud Enforcement Bureau to resolve federal civil and criminal charges against the company, as well as a “deferred prosecution” agreement. McKinsey does not admit liability in the civil settlement. A copy of the deferred prosecution agreement was not publicly available at the time of publication.

This means that unless McKinsey commits further opioid-related misconduct, other executives who led McKinsey during its years of helping drug companies increase sales of prescription opioids will not face criminal charges or trials. do not have.

McKinsey pledged to help Purdue Pharma, maker of the highly addictive painkiller OxyContin, “soar” sales at a time when fatal overdoses were spiking nationwide, according to an internal memo. is shown.

“We deeply apologize for our past customer service to Purdue Pharma,” McKinsey said in a statement sent to NPR on Friday. The company also apologized for “the actions of a former partner who deleted documents related to that client’s work.”

This payment is on top of the approximately $900 million that McKinsey previously agreed to pay in opioid settlements with state and local governments that sued the company.

“We should have recognized the harm that opioids are causing in our society and should not have taken on Purdue Pharma’s sales and marketing jobs. We should not have accepted this terrible public health crisis and our commitment to opioid manufacturers. “Our past work will always be a source of deep regret for our firm,” McKinsey’s statement said.

As part of the agreement, McKinsey agreed to refrain from any future work involving “controlled substances,” including opioids, and to face increased federal oversight.

The company also said it agrees with the “facts and allegations” underlying the misdemeanor charges and “felony obstruction by a former senior partner” against McKinsey.

Justice Department officials said the misdemeanors include “knowingly and intentionally conspiring with the city of Purdue and others to aid and abet the mislabeling of prescription drugs.”

“This resolution marks the first time that a management consulting firm has been held criminally liable for advice that led to a crime by a client,” Justice Kavanaugh said at a press conference Friday.

Purdue Pharma, a one-time McKinsey client, has twice pleaded guilty to federal charges related to opioid fraud, in 2007 and 2020. However, after the plea deal, none of the opioid manufacturer’s executives, employees, or owners went to trial or served any jail time. time.

After the prescription opioid crisis began in the 1990s, many companies agreed to pay hefty fines and settlements worth more than $50 billion, but only a handful of corporate executives were punished.

Critics argue that this pattern continued through two decades of Democratic and Republican administrations.

“Nobody goes to jail,” said Ed Bish, an opioid activist whose son Eddie died from an overdose of Purdue Pharma’s painkiller OxyContin in 2001. “Prisons have to stop because these companies see fines (to businesses) as a cost of doing business,” he said.

Bisch’s group, called Relatives Against Purdue Pharma, protested outside the Justice Department’s headquarters in Washington, D.C., demanding more accountability from corporate leaders who actively promoted and profited from the sale of opioids.

Bisch noted that the Justice Department frequently prosecutes street drug dealers, doctors, and “pill mill” pharmacy operators accused of fraud related to opioids. They often end up serving long prison sentences.

But executives at companies involved in marketing and distributing hundreds of millions of opioid pills rarely face felony-level charges or spend time in prison.

“Simply collecting illicit profits without prosecuting the individuals behind the crimes is not a real deterrent and leaves parents like me fed up,” Bisch said.

In fact, many of the top leaders of companies involved in the opioid industry receive large bonuses even though their companies have paid billions of dollars in opioid settlements or admitted to criminal conduct that is extremely dangerous to the public. and continues to receive raises.

“Companies just pay the speeding ticket and move on,” said Paul Peltier, a former Justice Department prosecutor who worked on the Purdue Pharma opioid investigation in 2006.

Peltier said the Justice Department’s approach often leaves misconduct by individual companies unchecked, even if the Justice Department claims there is evidence of serious wrongdoing. “It is imperative that the Department of Justice holds corporate executives accountable,” he said.

A Justice Department spokesperson said in a statement to NPR that charging decisions are made “based on the facts of each case.”

“While not all crimes that result in corporate criminal liability are committed by corporate leaders, whether such leaders will be subject to criminal charges is determined by proof beyond a reasonable doubt,” the Justice Department said in a statement. It depends on whether or not there is.”

Federal charges against opioid executives are not completely unprecedented. In 2019, the Department of Justice won a rare conviction against Insys Therapeutics CEO John Kapoor and four other company executives.

“Today’s conviction marks the first successful prosecution of a top pharmaceutical company for crimes related to the illegal sale and prescription of opioids,” then-U.S. Attorney Andrew Lelling said in a statement at the time. . That same year, the Justice Department also indicted executives of the Rochester Drug Cooperative, a local drug distributor in upstate New York.