McKinsey Agrees to $650 Million Settlement Over Opioid Crisis Role

Consulting giant McKinsey has reached a $650 million settlement tied to its actions during the opioid epidemic, following accusations of conspiring to misbrand prescription drugs.

In a landmark settlement, McKinsey & Company has committed to paying $650 million to resolve criminal charges linked to its involvement in the U.S. opioid crisis. The U.S. Department of Justice (DOJ) has stated that the firm "knowingly and intentionally" conspired with Purdue Pharma to misbrand prescription drugs, including the notorious painkiller OxyContin, which is a brand name for oxycodone hydrochloride. The DOJ's charges included allegations of conspiring to misbrand medications and obstructing justice.

According to prosecutors, McKinsey provided Purdue Pharma with strategies to significantly boost OxyContin sales, disregarding the drug's impact on public health. In a public statement, McKinsey expressed regret, acknowledging that, "we should have appreciated the harm opioids were causing in our society."

Additionally, former McKinsey senior partner Martin Elling is expected to plead guilty to charges of obstruction for allegedly destroying evidence in connection to the case. As part of a deferred prosecution agreement, McKinsey must adhere to specific reforms over the next five years for the prosecution to be suspended; should they comply, the charges may ultimately be dismissed.

This agreement comes on the heels of a significant $1 billion settlement McKinsey previously reached concerning its work with Purdue and other pharmaceutical entities. Purdue Pharma itself entered a guilty plea in 2020, agreeing to an $8.3 billion settlement related to its role in the opioid epidemic, which included enabling the distribution of drugs without legitimate medical justification.

The opioid crisis has led to a dramatic increase in drug addiction and overdose deaths across the United States, following a surge that began three decades ago with prescription opioids and later transitioned to heroin and synthetic opioids like fentanyl. Nearly 100,000 Americans lose their lives annually due to drug overdoses, with the latest reports indicating 97,000 overdose deaths in the year leading up to June 2024—a sign of a 14% decrease from the previous year.