McKinsey grilled by house committee over parallel work in opioid case

A Wednesday hearing before the House Committee on Oversight and Reform criticized consulting firm McKinsey & Company for advising opioid manufacturers at the same time that it provided consulting services to the US Food and Drug Administration (FDA).

The hearing is part of an ongoing federal probe into McKinsey’s role in the US opioid crisis, which has been linked to over half a million deaths.

The New York-based management consulting firm last year agreed to pay $641 million to settle claims from US states that the company contributed to the opioid crisis by providing marketing strategy services to manufacturers of opioid painkillers such as Purdue and Johnson & Johnson. McKinsey admitted no wrongdoing in the settlement.

“While our intent was not to fuel the epidemic, we failed to recognize the broader context of what was going on in society around us,” said McKinsey CEO Bob Sternfels, who was questioned by lawmakers for three hours. “That’s why we have new protocols and policies in place to prevent this happening again.”

The house committee grilled Sternfels over the perceived conflict of interest of advising opioid makers at the same time as the FDA. An April 13 preliminary report from the committee found 37 FDA contracts staffed by at least one McKinsey consultant who simultaneously or previously worked for Purdue. From 2008 to 2021, McKinsey worked on three dozen FDA contracts worth more than $65 million.

“McKinsey was advising both the fox and the hen-house, and getting paid by both,” said chairwoman Carolyn Maloney, a Democrat from New York. “McKinsey’s conflicts and conduct are among the worst I have seen in my years in government,” she added.

Sternfels denied conflict of interest, saying the company’s FDA work focused on administrative and operational areas and not on opioid-related matters. The CEO also said McKinsey did not share FDA intelligence with Purdue and was open with the FDA about its pharma consulting projects.

The house committee also questioned Sternfels, who ascended to CEO in July 2021, about a September 2013 presentation slide outlining a “Wildfire” sales strategy to increase the amount of sales calls to certain doctors to boost prescriptions written. The presentation also proposed cash prizes for top performing OxyContin sales reps in order to boost Purdue revenues.