'Deadly roadmap': McKinsey agrees to $573M settlement over opioid profits
The lawsuit alleged McKinsey earned millions for its work in designing and implementing marketing plans to the opioid makers.
A coalition of 47 states, the District of Columbia and five U.S. territories Thursday announced they’ve reached a $573 million settlement agreement with global consulting firm McKinsey & Co. over its role in advising opioid companies on how to promote and profit from their products.
Ten states led an executive committee investigation into McKinsey. Those states included Connecticut, California and New York. Thirty-seven other states joined the lawsuit and signed off on the settlement agreement. Only Nevada, Washington and West Virginia weren’t part of the agreement.
Related: Purdue Pharma pleads guilty to role in opioid crisis, will pay $8 billion and close doors
Connecticut is scheduled to receive $7.5 million to abate its opioid epidemic. Pennsylvania is set to receive $25.7 million; New York will get about $32 million; Florida about $40 million; New Jersey roughly $16 million; Texas about $38.4 million; and California $59.6 million.
The settlement followed a lawsuit alleging the New York City-based consulting company profited from its work advising opioid manufacturers on how to increase profits.
“At the same time McKinsey was working for opioid companies, McKinsey also consulted with governments and non-profits working to abate the raging opioid crisis—a crisis that McKinsey’s own research showed was caused in large part by prescription opioids,” the suit alleged. ”There are indications that individuals at McKinsey considered destroying or deleting documents related to their work for Purdue [Pharma].”
In addition to Purdue Pharma, the maker of OxyContin, the lawsuit said the company also had contracts with Johnson & Johnson and Endo Pharmaceuticals. The lawsuit said McKinsey earned millions of dollars for its work in designing and implementing marketing plans to the opioid makers.
As part of the agreement, McKinsey will implement a strict ethics code that all partners must agree to each year. In addition, the company agreed to stop advising opioid makers on potentially dangerous drugs.
“The abuse of opioids, not just by those who consumed these drugs, but by those who produced, marketed, distributed and dispensed them, has left much of America in mourning. We can’t being back lost lives, but we can hold ringleaders accountable,” former California Attorney General Xavier Becerra said.
Connecticut Attorney General William Tong said in a statement: “McKinsey consultants devised a deadly roadmap for Purdue to turbocharge the opioid epidemic, with callous disregard to the human suffering they caused. The hundreds of million of dollars they will now pay to states will go directly to abating this crisis.”
And New Jersey Attorney General Gurbir Grewal said: “With today’s settlement, McKinsey is paying much more money [than] it made advising opioid manufacturers like Purdue Pharma on how to sell more of their addictive drugs.”
In a statement on its website, McKinsey said it agreed to the settlement because it hoped to be “part of the solution to the opioid crisis in the U.S.”
“We chose to resolve this matter in order to provide fast, meaningful support to communities across the United States,” Kevin Sneader, global managing partner for the company, said on the website. “We deeply regret that we did not adequately acknowledge the tragic consequences of the epidemic unfolding in our communities.”
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