Attorney General Phil Weiser leads states to reach $573 million national settlement with McKinsey & Company for its role in ‘turbocharging’ the opioid epidemic with Purdue Pharma
Feb. 4, 2021 (DENVER) – Attorney General Phil Weiser today announced a $573 million settlement with a coalition of attorneys general from 47 states, the District of Columbia and five U.S. territories and one of the world’s largest consulting firms, McKinsey & Company, Inc. United States, to resolve investigations into the company’s role in working for opioid companies, helping those companies promote their drugs, and profiting from the opioid epidemic.
McKinsey recognized the harm its conduct caused and the agreement reached with the firm is the first multi-state opioid settlement to result in substantial payment to the states to address the epidemic. The settlement, after payment of costs, will be used to abate problems caused by opioids in the participating states. Colorado will receive nearly $10 million from the settlement.
McKinsey has also agreed to disclose, on a public website, tens of thousands of its internal documents detailing its work for opioid companies such as Purdue Pharma. In addition, McKinsey agreed to continue its investigation into allegations that two of its partners tried to destroy documents in response to investigations of Purdue Pharma, adopt a strict document retention plan, implement a strict ethics code that all partners must agree to each year, and stop advising companies on potentially dangerous Schedule II and III narcotics.
“I applaud McKinsey’s decision to step forward, accept responsibility, and work with us to address the opioid crisis. They are the first company to work with the states to fix the problem rather than deny their conduct and engage in protracted litigation or delay. Their approach provides a model for other companies to follow to focus our energy on fixing the problem rather than making excuses or blaming others,” said Attorney General Weiser. “The partners who tried to cover up their actions placed profit over responsible behavior and acted reprehensibly. To address that conduct, and make sure it does not happen again, McKinsey has committed to an expanded company-wide ethics code and agreed never to work for opioid companies like Purdue Pharma again.”
Today’s filings in Denver District Court describe how McKinsey contributed to the opioid crisis by promoting marketing schemes and consulting services to opioid manufacturers, including OxyContin maker Purdue Pharma, for over a decade. The complaint, filed with the settlement, details how McKinsey advised Purdue on how to maximize profits from its opioid products, including targeting high-volume opioid prescribers, using specific messaging to get physicians to prescribe more OxyContin to more patients, and circumventing pharmacy restrictions in order to deliver high-dose prescriptions.
When states began to sue Purdue’s directors for their implementation of McKinsey’s marketing schemes, McKinsey partners began emailing about deleting documents and emails related to their work for Purdue.
The opioid epidemic has led to considerable harm to individuals and communities in the state over the last 20 years. During this time, nearly 5,000 Coloradans have died from a prescription opioid overdose. From 2000-2019, the rate of annual prescription overdose deaths rose nearly 400%. On an economic level, these deaths—and the impacts on thousands who have struggled with opioid addiction—have created considerable costs to the state in the form of health care, child welfare, criminal justice, and many other programs needed to lessen the epidemic. It has also resulted in lost economic opportunity and productivity. On the social level, opioid addition, abuse, and overdose deaths have torn families apart, damaged relationships, and eroded the social fabric of communities.
Today’s filing is the latest action Weiser and his office has taken to combat the opioid epidemic and to hold accountable those who are responsible for creating and fueling the crisis. In July 2019, Weiser filed an updated lawsuit against opioid manufacturer Purdue Pharma that added former company executives and members of the Sackler Family for their roles in the opioid epidemic. The Colorado Attorney General’s Office also is involved in national settlement negotiations with other state attorneys general and opioid manufacturers and distributers to provide the states with resources for addiction and treatment services.
The Opioid Unit in the Consumer Protection Division of the Colorado Department of Law conducted the investigation into McKinsey & Company and is advising the attorney general on legal matters and the state’s response to the opioid crisis.
The states’ investigation was led by an executive committee made up of the attorneys general of California, Colorado, Connecticut, Massachusetts, New York, North Carolina, Oklahoma, Oregon, Tennessee, and Vermont. The executive committee is joined by the attorneys general of Alabama, Alaska, Arizona, Arkansas, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, North Dakota, Ohio, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, Utah, Virginia, Wisconsin, Wyoming, the District of Columbia, and the territories of American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands.