Business

McKinsey to pay $537m to settle claims over US opioid epidemic

US states claimed consulting firm had helped fuel the crisis

More than 400,000 Americans have died over the last two decades from opioid overdoses. Photograph: iStock

Thu Feb 4 2021 - 20:17

McKinsey will pay $573 million (€478 million) to settle claims by US states that the blue-chip consulting firm helped fuel the country's opioid epidemic by providing sales analysis and marketing advice to makers of the highly addictive painkillers, including Purdue Pharma and Johnson & Johnson.

Most of the money will go to government programs fighting opioid addiction and providing treatment, North Carolina attorney general Josh Stein said on Thursday. The company helped “turbocharge” opioid sales for 15 years while consulting for Purdue and its billionaire owners, the Sackler family, Mr Stein said.

New York-based McKinsey, which Forbes estimates had $10.5 billion in 2019 revenue and is one of the biggest US business consultants, also agreed to publicly disclose internal documents detailing all its work for opioid companies, which could be used in litigation by state and local governments against the industry.

“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,” said California attorney general Xavier Becerra. “We can’t bring back lost lives, but we can hold ringleaders accountable. McKinsey and Co was a player in this unfolding opioids tragedy.”

READ MORE

Reouping billions

More than 3,000 US state and local governments have targeted opioid makers and distributors in hopes of recouping billions in tax dollars spent dealing with the fallout of the opioid epidemic. More than 400,000 Americans have died over the last two decades from overdoses. Many of the municipalities’ suits have been consolidated before a federal judge in Cleveland.

In an emailed statement on Thursday, McKinsey denied allegations of wrongdoing, saying its “past work was lawful”. As part of the agreement with 49 states, five territories and the District of Columbia, “the attorneys general recognised McKinsey’s good faith and responsible corporate citizenship in reaching this resolution,” said the company, which has offices in more than 130 cities and 65 countries. – Bloomberg

LATEST STORIES