Global consultancy firm McKinsey has reached a rare $573 million settlement with US states over claims that the company’s advice to pharmaceutical giants contributed to the deadly opioid crisis.
Almost half a million Americans died in overdoses from both prescription and illegal opioids between 1999 and 2018, according to the Centers for Disease Control and Prevention.
McKinsey worked with Perdue Pharma — which last year pleaded guilty to criminal charges over the production and sale of prescription opioid OxyContin — advising the firm how to “turbocharge the sales engine” of the drug, according to a Massachusetts lawsuit.
The $573 million settlement has been reached with attorneys general in 47 states, the District of Columbia and five territories, according to the New York Times and Wall Street Journal, which both cited people familiar with negotiations.
The consultancy firm will not admit wrongdoing, reports said, but will submit to court-ordered restrictions on some of its work with some types of addictive narcotics.
With the settlement McKinsey will avoid the possibility of any civil suits.
The settlement, $478 million of which must be paid within 60 days according to the New York Times, will be filed Thursday.
It exceeds any profits the firm made from opioid-related work with pharmaceutical giants, according to one person quoted by the Times.
States will put the money towards prevention, treatment and recovery programs, the paper added.
McKinsey stopped opioid-related work in 2019, the Wall Street Journal reported.
The payout comes after documents emerged from Perdue’s bankruptcy case detailing some of the consultancy firm’s work with the pharmaceutical giant.
In one instance, the Times reported, McKinsey consultants worked with Perdue Pharma to counter “the emotional messages from mothers with teenagers that overdosed” on OxyCotin.
Authorities have said that the opioid crisis has driven the first significant reduction in US life expectancy since the AIDS epidemic in the 1990s.
McKinsey and Company did not respond to AFP requests for comment.