Consultant to pay $573.9 million as consequence of its sketchy opioid advice

Patrick Malone & Associates P.C. | DC Injury Lawyers
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Patrick Malone & Associates P.C. | DC Injury Lawyers

The opioid abuse and drug overdose crisis has tarred yet another of the nation’s business titans: McKinsey, a globally renowned consulting firm, has discovered that providing corporate clients sketchy advice about addictive, debilitating, and even lethal prescription medications can have consequences.

The firm, which has apologized for its conduct, has agreed to pay $573.9 million in a settlement with 47 states over consulting work it did for multiple Big Pharma companies, notably with Purdue Pharmaceuticals, the maker of the drug OxyContin.

Critics of Purdue, citing media investigations and in civil lawsuits filed by states and local governments, have argued that Purdue pioneered aggressive and deceptive advertising, marketing, and sales practices that fueled the abuse of powerful prescription painkillers and opened the door to overdoses of those drugs, synthetic versions of them, as well as illicit narcotics.

The crisis killed at least 450,000 Americans in the decade starting in 1999, federal officials say, and while it seemed to be receding, it has only surged anew during the coronavirus pandemic.

Crossing a line as paid advisors

As the New York Times reported, McKinsey’s internal communications — unearthed as part of lawsuits against it by states and local governments — caught the firm giving aggressive and dubious advice to Purdue and other drug makers about pushing painkillers known to be addictive and even lethal, as well as ways to push back against increasing regulator pressure to curb opioid sales. As the Washington Post reported:

“McKinsey ‘sold its ideas’ to OxyContin maker Purdue Pharma for more than 15 years beginning in 2004, according to Massachusetts court filings, which note that McKinsey carried on efforts to expand opioid sales even after an affiliated company, Purdue Frederick, pleaded guilty to misbranding OxyContin, its flagship opioid. McKinsey was intimately involved in the drug maker’s push to expand its market, according to the states, helping to fend off Food and Drug Administration restrictions and, at the height of the epidemic, developing a multipoint plan for the drug company to ‘turbocharge’ sales. McKinsey also worked for other companies that profited from opioids, including Johnson & Johnson and Endo, according to the legal filings, with the consultants earning millions of dollars designing and implementing marketing programs for the companies.”

The New York Times reported that McKinsey’s recommendations, even on casual examination, were excessive:

“In a 2017 slide presentation for Purdue, McKinsey laid out several options to shore up sales. One was to give distributors a rebate for every OxyContin overdose attributable to pills they sold. The slides are notable for their granular detail. For example, McKinsey estimated that 2,484 CVS [drug store] customers would overdose or develop an opioid use disorder in 2019 from taking OxyContin. CVS said the plan was never implemented.”

McKinsey fired two consultants who may have tried to destroy evidence in the case, which the firm has agreed to preserve and make public. The company’s settlement will exceed any sums it was paid for its work, and McKinsey may yet face more lawsuits for advising Big Pharma — and industry that the firm has told its own employees it will curtail and constrain its future work for, along with others.

As the New York Times reported of this consulting debacle:

“One former partner called the settlements hugely significant because it shatters the distance that McKinsey — which argues that it only makes recommendations — puts between its advice and its clients’ actions. For decades, the firm has avoided legal liability for high-profile failures of some clients, including the energy company Enron and Swissair, Switzerland’s defunct 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 in recent years they have aggressively moved into a new line of work, not only offering management advice but also helping companies implement their suggestions. That is what happened with McKinsey at Purdue, said Phil Weiser, the attorney general for Colorado. Two McKinsey senior partners led the firm’s effort to implement plans to drive sales, working with members of the Sackler family and even overruling Purdue executives, Mr. Weiser said. ‘When you see the actions of these McKinsey partners, they were almost acting as executives of the firm,’ Mr. Weiser said.”

Crisis worsens during pandemic

McKinsey must fork over $478 million of its settlement in the next two months or so, with the recipient states and local governments planning to use that money to combat the resurgent opioid crisis. It is one of a mountain of major challenges confronting the Biden Administration, as NPR reported:

“From May 2019 to May 2020, 81,000 people died of a drug overdose in the U.S. It’s the highest number of overdose deaths ever recorded in a 12-month period, according to the Centers for Disease Control and Prevention. The main cause was synthetic opioids.”

Drug abuse experts have expressed concern that the new administration may have so many issues to deal with that a robust response to the worsening opioid crisis may not be as high a priority as it needs to be. Beau Kilmer, director of the Drug Policy Research Center at the RAND Corporation, told NPR:

“While Covid-19 may have pushed our problems with overdoses to the backburner, they’re still boiling over. New ideas are desperately needed.”

Administration officials pointed out that the president’s $1.9 trillion pandemic response measure includes a boost in mental health funding, which could be helpful in combatting the opioid crisis.

Still, Biden officials have taken heat for unwinding a hasty order by their predecessors expanding doctors’ ability to use the prescription drug buprenorphine to deal with opioid overdoses. Doctors had praised the decision to allow greater use of this medication. Biden has endorsed the idea of expanding its use, but administration officials had deep questions about the legality of their predecessor’s order and how it would be carried out.

In my practice, I see not only the harms that patients suffer while seeking medical services, but also the damage that can be inflicted on them and their loved ones by dangerous prescription medications, especially opioids, their synthetic versions, and illicit drugs.

The opioid and overdose crisis took years to explode, fueled by Big Pharma, doctors, nurses, hospitals, insurers, regulators, and many others in health care. The isolation, alienation, fear, economic disruption, and inequity that have been part and parcel of the coronavirus pandemic have only made more nightmarish the addiction, debilitation, and deaths unleashed by a preventable drug epidemic. The new administration cannot ignore the damage that this crisis has inflicted and will continue to wreak — in cities but also in exurban and rural communities, too. We have much work to do to attack this public health menace.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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