McKinsey’s fool
McKinsey & Company agreed to pay $ 573 million to settle investigations into its role in helping to "turbo-charge" opioid sales
McKinsey & Company, the consultant to corporations and governments around the world, has agreed to pay $ 573 million to settle investigations into its role in helping to "turbo" opioid sales, a rare case in which it is was held publicly accountable for her work with clients.
The company struck a deal with attorneys general from 47 states, the District of Columbia and five territories, according to five people familiar with the negotiations. The deal comes after lawsuits uncovered a series of documents showing how McKinsey worked to lead the sales of Purdue Pharma's pain reliever OxyContin, in an opioid outbreak in the United States that contributed to the death of more than 450,000 people in the past two decades – writes the NYT .
McKinsey's extensive work with Purdue included advice to focus on selling the lucrative high-dose pills, documents show, even after the drug company pleaded guilty in 2007 to misleading doctors and regulators about OxyContin's risks. . The company also told Purdue that it could "team up" with other opioid manufacturers to avoid "rigorous treatment" by the Food and Drug Administration.
The consulting firm will not admit wrongdoing in the deal, which will be filed in state courts on Thursday, but will agree with court-imposed restrictions on its work with certain types of addictive narcotics, according to those familiar with the law. 'agreement. McKinsey will also keep the emails for five years and disclose potential conflicts of interest when bidding on state contracts. And in a move similar to the tobacco industry deals decades ago, he will put tens of thousands of pages of documents related to his opioid work into a publicly available database.
States will use civil penalties – $ 478 million to be paid within 60 days – for opioid treatment, prevention and recovery programs. It will be the first money states will see after Purdue Pharma agreed to pay $ 8.3 billion in October and pleaded guilty to federal criminal charges over its commercialization of OxyContin. Purdue has filed for bankruptcy, which means states party to that deal will have to align with other creditors.
Separately, members of the Sackler family, which owns Purdue, agreed last fall to pay the federal government $ 225 million in civil penalties, and are in talks with other contenders to pay $ 3 billion.
Many states were dissatisfied with the October deal, which the Trump administration's Justice Department reached just days before the former president was defeated in the November election.
The amount McKinsey is paying is substantially more than what he earned from opioid-related work with Purdue or Johnson & Johnson, Endo International, and Mallinckrodt Pharmaceuticals, his other opioid-producing clients, one of the people said.
A former partner called the deal enormously significant because it breaks the distance that McKinsey – who claims to only make recommendations – puts between his advice and the actions of his clients. For decades, the company has shied away from legal liability for the high-profile bankruptcies of some customers, including energy company Enron and Swissair, the defunct Swiss national airline. The former partner asked for anonymity because former McKinsey employees are bound by confidentiality agreements.
Making McKinsey and its competitors even more vulnerable is the fact that they have moved aggressively in recent years, not only offering management advice, but also helping companies implement their recommendations.
McKinsey materials released in litigation in the last two years date back to 2004 and run through 2019.
The documents highlight McKinsey's close relationship with Purdue for many years. In 2009, the company wrote a report for Purdue saying the new sales tactics would increase OxyContin sales by a whopping $ 400 million annually, and suggested "sales drivers" based on the idea that opioids they reduce stress and make patients more optimistic and less isolated, ”according to a lawsuit filed in 2018 by Massachusetts. McKinsey worked with Purdue executives to find ways to "counter the emotional messages of mothers with teen overdoses" of the drug.
In 2013, the federal government reached a deal with Walgreens, the pharmacy chain, to crack down on illegal opioid prescriptions. Sales at Walgreens began to decline. According to the Massachusetts lawsuit, McKinsey recommended that Purdue "pressure the leaders of Walgreens to ease their grip."
And in a 2017 slide presentation, McKinsey laid out several options for supporting sales. One was to give Purdue distributors a refund for any OxyContin overdose attributable to the pills sold. The slides are notable for their granular detail. For example, McKinsey estimated 2,484 CVS clients would overdose or develop an opioid use disorder in 2019 from taking OxyContin. CVS said the plan was never implemented.
In 2018, McKinsey's top executives were becoming aware that they could face responsibility for their opioid work. After Massachusetts sued Purdue, Martin Elling, a leader of the company's pharmaceutical practice, wrote to another partner, Arnab Ghatak: “It probably makes sense to have a quick conversation with the risk committee to see if we should do. something ”other than“ deleting all our documents and emails. I suspect not, but when things get more difficult, someone might turn to us ”.
Both men were put on administrative leave pending the results of an external investigation to see if any material was destroyed, McKinsey North American managing partner Liz Hilton Segel said in a letter to Congress in the month of December. That month, McKinsey released a rare public apology for his opioid work.
"Looking back at our customer service during the opioid crisis, we recognize that we have not adequately recognized the epidemic unfolding in our communities or the dire impact of opioid abuse and addiction on millions of families across the country." the company said in a statement. The company then changed the statement to read "misuse" instead of "abuse".
The deal with the 47 states – Nevada, Washington and West Virginia were not part of it – does not prevent the Biden administration from seeking legal action against McKinsey. Additionally, several counties and cities across the country – including Mingo County in West Virginia, one of the states hardest hit by the opioid crisis – have sued McKinsey in recent days.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/mondo/la-figuraccia-di-mckinsey/ on Sat, 06 Feb 2021 06:47:57 +0000.