McKinsey settles with US local governments over opioid consulting work

McKinsey & Company has agreed to settle claims by hundreds of US local governments and school districts that the consulting firm fueled an opioid addiction crisis through its work for Purdue Pharma and other opioid manufacturers.

The deal was disclosed in a court filing in a San Francisco federal court on Wednesday evening, according to Reuters. The terms were not made public.

McKinsey 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.

The firm’s advisory work included 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.

McKinsey argued the US state settlements should shield it from local government and school district lawsuits.

The New York-headquartered consulting firm still faces claims by Native American tribes and claims on behalf of children exposed to opioids in the womb.

McKinsey’s former client Purdue is in bankruptcy and earlier this year reached a nationwide settlement in which the Sackler family members who own the company would boost their cash contribution to as much as $6 billion. The settlement aims to stop the flood of lawsuits facing the OxyContin manufacturer and protects the Sackler family from civil lawsuits.

McKinsey has also been undergoing a federal probe into its role in the US opioid crisis, which has been linked to 500,000 deaths. A House committee has been investigating whether there was a conflict of interest in McKinsey advising the FDA at the same time it was working with opioid manufacturers.