McKinsey Agrees to $650 Million Settlement Over Opioid Allegations
Consulting Firm McKinsey to Pay $650m to Settle Opioid Crisis Charges
McKinsey & Company has agreed to pay $650 million (£515 million) to resolve criminal charges tied to its role in the US opioid epidemic. The US Department of Justice (DOJ) accused the consulting firm of conspiring with Purdue Pharma to “aid and abet the misbranding of prescription drugs… without valid prescriptions.”
The DOJ revealed that McKinsey had advised Purdue Pharma on strategies to boost sales of OxyContin, a powerful painkiller containing oxycodone hydrochloride. This included efforts to “turbocharge” sales despite the drug’s role in fueling addiction. McKinsey also faced charges of obstructing justice during the investigation.
In a statement, McKinsey expressed regret, acknowledging, “We should have appreciated the harm opioids were causing in our society.”
Additionally, former McKinsey senior partner Martin Elling is set to plead guilty to obstruction for destroying records related to the case.
As part of the settlement, McKinsey has entered a five-year deferred prosecution agreement. If it complies with the terms, which include company reforms, prosecutors may ultimately dismiss the charges.
McKinsey has previously paid nearly $1 billion (£792 million) to settle lawsuits over its consulting work with Purdue and other pharmaceutical companies.
The opioid crisis has devastated the United States over the past three decades, beginning with the over-prescription of painkillers like OxyContin, which Purdue Pharma introduced in the mid-1990s. By 2002, OxyContin made up 68% of oxycodone sales, with studies showing it and other opioids like hydrocodone were widely abused.
Purdue Pharma itself pleaded guilty in 2020 to criminal charges for its role in the crisis, agreeing to an $8.3 billion (£6.6 billion) settlement. The company admitted to facilitating the distribution of drugs “without legitimate medical purpose.”
The opioid epidemic has since evolved, with addiction and overdose deaths rising sharply, particularly due to heroin and synthetic opioids like fentanyl. Nearly 100,000 people die annually from drug overdoses in the US. However, overdose deaths in the year leading up to June 2024 dropped to 97,000, a 14% decrease from the previous year.
