McKinsey & Co agreed to pay $650 million to resolve a U.S. Justice Department investigation into the work of the consulting firm that advises OxyContin opioid maker Purdue Pharma on how to boost sales.
McKinsey signed a five-year deferred prosecution agreement filed in federal court in Abingdon, Virginia, to resolve criminal charges brought as part of the latest corporate prosecution related to the marketing of addictive painkillers that helped fuel the deadly opioid epidemic in the United States. Joined.
Prosecutors said McKinsey provided Stamford, Connecticut-based Purdue with advice on steps it could take to “boost” sales of OxyContin. He was charged with conspiring to mislabel a drug and obstruction of justice.
A former McKinsey senior partner, Martin Elling, also agreed to plead guilty to obstruction of justice for destroying records related to McKinsey’s work for Purdue, according to court documents. He is scheduled to enter his guilty plea on January 10.
Elling deleted documents related to his work for Purdue from his company laptop, sending himself emails to remind himself to do so, according to court documents.
“We deeply regret our prior client service to Purdue Pharma and the actions of a former partner who deleted documents related to his work for that client,” McKinsey said in a statement.
“We should have appreciated the harm opioids were causing in our society and should not have done sales and marketing work for Purdue Pharma. “This terrible public health crisis and our past work for opioid manufacturers will always be a source of deep regret for our company.”
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McKinsey agreed to pay the $650 million over five years
A lawyer for Elling declined to comment.
McKinsey agreed to pay $650 million over five years, improve its compliance practices to detect illegal activity and submit to oversight by the Justice Department and the inspector general’s office of the US Department of Health and Human Services as part of the prosecution agreement. deferred, the company said.
The consulting firm also agreed to resolve a civil investigation related to alleged violations of the False Claims Act and enter into a “corporate integrity” agreement with the HHS inspector general’s office, the company said.
Purdue pleaded guilty in 2020 to criminal charges covering widespread misconduct regarding its handling of prescription painkillers, including conspiring to defraud U.S. officials and paying illegal kickbacks to both doctors and an electronic health records provider.
Purdue is currently involved in a court-ordered mediation over a multimillion-dollar settlement reached in a bankruptcy proceeding that the U.S. Supreme Court overturned.
In a statement Friday, Purdue said it was working to forge consensus on the plan to “deliver billions of dollars of value for opioid reduction” and create a new company as an “engine for good.” Proceeds from the settlement are also intended to compensate victims, Purdue said.
McKinsey previously reached settlements totaling nearly $1 billion to resolve widespread lawsuits and other legal actions alleging the company helped fuel the opioid epidemic through its work as an advisor to OxyContin maker Purdue Pharma and other drug manufacturers.
In 2019, McKinsey announced it would no longer advise clients on opioid-related businesses. The company has maintained that none of its agreements contain admissions of liability or wrongdoing.
With information from Reuters.
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