In a court filing on Friday, McKinsey & Company agreed to pay $650 million in a deferred prosecution deal to end a federal criminal investigation into the firm’s consulting work advising Purdue Pharma on how to boost sales of its narcotic medication OxyContin.
According to a petition in U.S. District Court in Abingdon, Virginia, Martin Elling, a former top partner at McKinsey, also consented to enter a guilty plea to obstruction of justice next month in the U.S. Department of Justice investigation.
The consulting behemoth “knowingly and intentionally” colluded with Purdue Pharma “and others to aid and abet the misbranding of prescription drugs,” according to the criminal charge sheet that McKinsey consented to have filed by prosecutors.
Additionally, according to the document, McKinsey is charged with “knowingly destroying and concealing records and documents with the intent” to obstruct the Department of Justice’s inquiry through the actions of its former partner Elling.
According to the deferred prosecution deal, McKinsey, which had already agreed to pay almost $1 billion to resolve claims from states, local governments, and others for its opioid advising, took accountability for the actions claimed by federal prosecutors.
McKinsey will not work on any controlled substance marketing, sales, promotions, or distribution as part of the agreement.
“We are deeply sorry for our past client service to Purdue Pharma and the actions of a former partner who deleted documents related to his work for that client,” McKinsey stated in a statement to CNBC.
The company stated, “We should not have done sales and marketing work for Purdue Pharma and we should have recognized the harm opioids were causing in our society.” Our firm has asked McKinsey for response, saying, “This terrible public health crisis and our past work for opioid manufacturers will always be a source of profound regret.”
The business stated that it “has agreed to settle a related civil False Claims Act investigation and to enter into a Corporate Integrity Agreement with the Office of Inspector General at the Department of Health and Human Services” in addition to its deferred prosecution deal with the DOJ.
