WASHINGTON, D.C. – Attorney General Karl A. Racine today announced a $573 million settlement with McKinsey & Company (McKinsey), one of the world’s largest consulting firms, over its role in worsening the opioid epidemic. The settlement—negotiated with a coalition of attorneys general from the District of Columbia, 47 states, and five U.S. territories—resolves an investigation into the firm’s work to help opioid manufacturers promote and profit off dangerously addictive painkillers. The District will receive $1.08 million over five years for local efforts to address the harms caused by opioids through this settlement—the first multi-state opioid case to result in substantial payment to the states. In addition to the payment, McKinsey has agreed to make available to the public internal documents detailing its work for opioid manufacturers, complete investigations of internal attempts to destroy materials pertinent to the firm’s engagements with opioid manufacturers, adopt a strict document retention plan and code of ethics, and cease any consulting efforts related to the development or sale of potentially dangerous drugs.

“Between 1999 and 2018, approximately 450,000 Americans lost their lives to opioid overdose—deaths that were driven by the greed of opioid manufacturers, other industry players, and their enablers,” said AG Racine. “Shockingly, at least one manufacturer—Purdue Pharma—paid McKinsey & Company handsomely for expert advice on how to make more money by pushing more of their addictive drugs to more unsuspecting victims. Rather than rejecting Purdue’s morally offensive request, McKinsey effectively made a deal with the devil and chose profits over lives. Sadly, today’s settlement cannot bring those who perished back to life, nor can it repair the pain and anguish families have suffered. However, it accomplishes two important objectives: it tells the truth about how McKinsey conducted its business and it secures much needed money for those still suffering from the effects of addiction.”

McKinsey, founded in 1926 and headquartered in New York City, is one of the world’s largest consulting companies. The firm’s approximately 27,000 employees work with corporations and governments across industries and around the globe, generating over $10 billion in annual revenue. Clients have included Enron, U.S. Immigration and Customs Enforcement, and the Saudi Arabian monarchy. 

The ongoing opioid epidemic has exploded across the U.S. in recent years, taking the lives of hundreds of thousands of Americans nationwide. Since overdose deaths began rising 20 years ago, this crisis has generated considerable harm to the District. Opioid addiction, abuse, and deaths have shattered District families and fractured communities, while draining District resources in health care, child welfare, and criminal justice and depleting economic opportunity and productivity.

McKinsey provided consulting services to opioid manufacturers, including OxyContin maker Purdue Pharma, over a span of more than 15 years. This work helped manufacturers maximize profits on the sale of opioid products. The firm advised on how to target high-volume opioid prescribers, use specific messaging that would push physicians to prescribe more OxyContin to more patients, and circumvent pharmacy restrictions to deliver high-dose prescriptions. When states began to sue Purdue Pharma’s directors for their implementation of McKinsey’s marketing schemes, McKinsey partners began emailing about deleting documents and emails related to their work for Purdue Pharma.

For its role in worsening the breadth and impact of the opioid epidemic, McKinsey has agreed to a settlement requiring the company to:

• Pay $573 million: This money will be distributed among all coalition members over a five-year period. The states will direct this money towards opioid relief efforts.
   
• Publicly disclose details of the firm’s work with opioid manufacturers: McKinsey will make tens of thousands of internal documents stemming from its work with Purdue Pharma and other opioid manufacturers available online for public examination. The firm will also adopt a strict document retention plan to ensure all relevant materials are preserved for investigative purposes.  
   
• Fully investigate allegations of document tampering: The firm will complete an investigation into two partners at the firm who allegedly attempted to destroy documents in response to state inquiries into Purdue Pharma. The firm will terminate any employee who attempted to tamper with evidence in both this investigation and any future state, federal, or foreign investigations.
   
• Implement a strict ethics code: All partners at the firm will be required to reaffirm their commitment to the code each year.
   
• Cease all work advising companies on matters related to potentially dangerous Schedule II and III drugs: McKinsey will not take on any future engagements relating to discovery, development, manufacturing, marketing, promotion, advertising, recall, withdrawal, monitoring, sale, prescribing, use or abuse of any opioid-based Schedule II or III controlled substance.

A copy of the complaint is available at: https://oag.dc.gov/sites/default/files/2021-02/McKinsey%20Complaint%202.3.21%20FILED.pdf

A copy of the consent judgment is available at: https://oag.dc.gov/sites/default/files/2021-02/McKinsey%20Consent%20Judgment%20entered_0.pdf

The states’ investigation was led by an executive committee made up of the attorneys general for California, Colorado, Connecticut, Massachusetts, New York, North Carolina, Oklahoma, Oregon, Tennessee, and Vermont. The executive committee is joined by AG Racine, along with the attorneys general from Alabama, Alaska, Arizona, Arkansas, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, North Dakota, Ohio, Pennsylvania, Rhode Island, South Carolina, South Dakota, Texas, Utah, Virginia, Wisconsin, Wyoming, and the territories of American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands.

Ending the Opioid Crisis
This settlement is the latest development in the Office of the Attorney General’s efforts to address the national opioid crisis and protect District residents from harm. In 2018, the D.C. Council passed a permanent version of the Synthetics Abatement and Full Enforcement Drug Control Act (Safe DC) proposed by AG Racine to make it easier to prosecute the suppliers and distributors of dangerous drugs, including the synthetic opioid fentanyl. In June 2019, AG Racine sued Purdue Pharma and former top executive Richard Sackler for misleading patients, doctors, and communities about the danger of opioids in pursuit of massive profits from sales. Last summer, AG Racine led a 10-state coalition supporting states’ rights to enact policies geared towards opioid overdose prevention.