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Consulting giant McKinsey agrees to $78 million settlement in opioid case
McKinsey settles for $78 million in a landmark agreement with insurers over its alleged role in fueling the opioid crisis.
A $78 million settlement has been reached between McKinsey and Co., a consulting firm, and a group of insurers and healthcare funds who accused the firm of contributing to the opioid addiction crisis through its work with drug manufacturers.
The settlement was disclosed in court documents on Friday night in a federal court in San Francisco. It still needs the approval of a judge.
The settlement would create a fund that McKinsey would use to pay back insurers, private benefit plans and others who incurred costs related to prescription opioids.
The insurers claimed that McKinsey collaborated with Purdue Pharma, the producer of OxyContin, to design and implement marketing and sales strategies that were aggressive and aimed at overcoming the reluctance of doctors to prescribe the highly addictive drugs.
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The insurers said that this resulted in them having to pay for prescription opioids instead of safer, non-addictive and cheaper alternatives, such as over-the-counter pain relievers. They also had to cover the costs of treating opioid addiction.
$78M settlement adds to previous agreements
According to the U.S. Centers for Disease Control, almost 280,000 people in the U.S. lost their lives to overdoses of prescription opioids from 1999 to 2021. The insurers alleged that McKinsey continued to work with Purdue Pharma even after the severity of the opioid crisis became evident.
The settlement is part of a long-running effort to hold McKinsey responsible for its role in the opioid epidemic. In February 2021, the firm agreed to pay close to $600 million to U.S. states, the District of Columbia and five U.S. territories. In September, the firm announced another settlement of $230 million with school districts and local governments.
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When asked for a comment on Saturday, McKinsey referred to a statement it issued in September.
“As we have stated previously, we continue to believe that our past work was lawful and deny allegations to the contrary,” the firm said, adding that it settled to avoid lengthy litigation.
McKinsey said it stopped working with clients on any business related to opioids in 2019.
