Consulting firm McKinsey & Co. is seeking to settle a federal investigation into its efforts to help opioid maker Purdue Pharma boost sales of the highly addictive drug OxyContin, according to court documents filed Friday in Virginia. , agreed to pay $650 million.
As part of the agreement with the U.S. Department of Justice, McKinsey will avoid criminal charges if it pays the amount and abides by certain conditions for five years, including ceasing any sales, marketing or promotion of controlled substances. It will be.
Former McKinsey senior partner Martin Elling is also guilty of obstruction of justice for deleting documents from his laptop after learning of an investigation into OxyContin maker Purdue Pharma, a then-customer, according to filings. He said he agreed to admit it. Mr. Elling’s attorney declined to comment Friday.
McKinsey said in a statement Friday that it “deeply regrets” its actions against Purdue Pharma.
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“We should have recognized the harm that opioids are causing our society and should not have taken over Purdue Pharma’s sales and marketing operations,” the company said. “Our past efforts against this horrific public health crisis and opioid manufacturers will always be a source of deep regret for our company.”
Opioids have been linked to more than 80,000 deaths a year in recent years and have helped fuel America’s addiction and overdose crisis, company officials say, and federal prosecutors seeking to hold them accountable. This is the latest initiative. For the past decade, most of the deaths have been attributed to illegal fentanyl, which is mixed into many illegal drugs. At the beginning of the epidemic, prescription drugs were the leading cause of death.
Over the past eight years, drug companies, wholesalers, and pharmacies have agreed to settlements worth about $50 billion with governments, with most of the needed funds going to fight the crisis.
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Purdue paid McKinsey more than $93 million over 15 years for several products, including ways to improve profits from OxyContin. Prosecutors said McKinsey “knew of the dangers and dangers” of OxyContin and that Purdue Pharma executives had previously pleaded guilty to crimes related to promoting the drug, but it did so anyway. He said he decided to work with opioid manufacturers.
Part of McKinsey’s job, the paper said, was to identify which prescribers would issue the most additional prescriptions if Purdue salespeople focused on that. As a result, “unsafe, ineffective, and medically unnecessary prescriptions were written for no medically recognized indication and were often repurposed for uses that lacked a legitimate medical purpose.” ” states the application.
“This wasn’t a hypothesis. This wasn’t just marketing. It was a strategy. It was executed and it worked,” Christopher Kavanaugh, the U.S. attorney for the Western District of Virginia, said Friday at a news conference in Boston. ” he said.
McKinsey consultants accompanied Purdue sales representatives to visit prescribers and pharmacies to gather information during Purdue’s efforts to “boost” sales after a 2013 slump. In a memo to a fellow passenger, a McKinsey consultant said a pharmacist was holding a gun and was “trembling.” Abuse is definitely a big problem. ” According to court documents, the company continued to look for ways to increase sales of OxyContin.
According to court filings, McKinsey in 2014 identified several small clinics that were writing more opioid prescriptions than the entire hospital system and made efforts to target those clinics for more sales. He suggested it.
The company also sought to help Purdue gain a say in developing federal regulations aimed at ensuring that the benefits of addictive prescription drugs outweigh the risks. As a result, high-dose OxyContin is subject to the same oversight as low-dose opioids, and training for prescribers is now voluntary rather than mandatory, the government said in a new filing.
McKinsey has awarded approximately $765 million to state and local governments since 2021 for its role in advising companies on how to sell more powerful prescription painkillers during the national opioid crisis. agreed to pay a settlement amount.
Last year, the company also agreed to pay $78 million to health funds and insurance companies.
Federal authorities say the deal is the first time a management consulting firm has been held accountable for advising a client in violation of the law.
“If a consultant first conspires with a client to commit a criminal act, the fact that they are an outside consultant does not protect you,” said Joshua Levy, U.S. Attorney for Massachusetts.
Some proponents argue that the opioid crisis began 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 fines. The company pleaded guilty to criminal charges in 2020 and agreed to $8.3 billion in penalties and forfeitures, most of which will be forgiven as long as it fulfills its ongoing settlement through bankruptcy court.
