Corporate Opioid Promoters Agree to Hefty Settlement

Consulting firm McKinsey & Company settled investigations into its involvement in helping boost opioid sales for drug manufacturers. The settlements with attorneys general representing 47 states, Washington, D.C., and five other territories totaled $573 million, in addition to separate deals with Washington state ($13 million) and West Virginia ($10 million).

The settlements were reached after the discovery of McKinsey documents that tracked how the firm was able to increase sales of opiate painkillers, including directing Perdue Pharma leaders to “turbocharge” sales of OxyContin.

Although the settlements were announced in early February, the consequences are still rippling out. Last week partners at McKinsey ousted the firm’s global managing partner and CEO Kevin Sneader.

Although the firm’s ties to the opioid crisis were likely not the sole reason for rejecting Sneader, The New York Times reported that a majority of the firm’s 650 senior partners voted to deny Sneader a second three-year term as the global managing partner. “It is highly unusual for a sitting managing partner at McKinsey to be refused a follow-on term,” according to The Times. “The last time a firm leader was denied a second term was in 1976.”

“During Sneader’s tenure, McKinsey has faced major corruption scandals in South Africa; criticism over contracts with current or former authoritarian governments in China, Turkey, Saudi Arabia, and Ukraine; and lawsuits challenging the firm’s role in encouraging client Perdue Pharma to aggressively promote OxyContin, thereby fueling the opioid crisis,” Forbes noted.

Sneader penned a letter to McKinsey employees after the settlements were announced, explaining that the settlements were agreed to in order to avoid further litigation. In the letter, McKinsey noted that the firm “did not adequately acknowledge the epidemic unfolding in our communities.”

“Some of the firm’s senior partners, especially those outside the U.S., reportedly thought that his acknowledgement went too far, and they were upset about the size of the settlement,” Forbes reported.

The opioid crisis has had other impacts beyond marring corporate reputations. Besides lawsuits against pharmaceutical companies, including Johnson & Johnson and Purdue, data from the U.S. National Institutes of Health (NIH) indicated that overdose deaths linked to prescribed opioids between 2000 and 2019 increased from 1.3 deaths to 5 deaths per 100,000, especially as pills were diverted from legitimate supply chains. (For more information on how prescription opioids have been diverted, read “Drug Diversion and Loss Prevention: A Changing Landscape.”) Healthcare workers also face increasing fallout from opioid addiction, especially if they deny patients access to the drugs.

According to the National Safety Council, employers can help their employees in mitigating substance abuse. The council estimated that one in 12 employees is dealing with an untreated substance use disorder.

“In a National Safety Council survey, 86 percent of employers were concerned that prescription opioid use was having a negative impact on their workplace, and 74 percent were concerned about heroin and fentanyl having a negative impact on their workplace,” the council said.

For more information on employers’ responses to the survey, visit https://nsc.org/workplacedruguse.