New York, (APP – UrduPoint / Pakistan Point News – 14th Dec, 2024) Consulting giant McKinsey & Company will pay $650 million to settle US criminal charges that it collaborated with Purdue Pharma to intentionally misbrand opioids, worsening a public health crisis, officials announced Friday.
US prosecutors unveiled a sweeping deferred prosecution agreement (DPA) over McKinsey efforts that helped Purdue “turbocharge” sales of the highly addictive OxyContin opioid, responsible for deadly overdoses.
The accord, which requires McKinsey to implement a comprehensive compliance program, represents the “first time a management consulting firm has been held criminally responsible for advice that it has given resulting in the commission of a crime by a client,” said US Attorney Christopher Kavanaugh, of the Western District of Virginia, speaking at a news conference.
Additionally, prosecutors charged McKinsey US with one felony count of knowingly destroying evidence with an intent to impede a probe and a misdemeanor of knowingly conspiring with Purdue to abet the misbranding of drugs, the Justice Department said.
The DPA, which will expire in five years if McKinsey meets the conditions, also noted that a senior partner with the prominent consultancy “knowingly” destroyed and hid records with the “intent to impede, obstruct and influence” the probe.
Prosecutors said the former McKinsey partner, Martin Elling, had agreed to plead guilty in the case.
From 1999 through 2022 nearly 727,000 people died from opioid overdoses, according to the Centers for Disease Control and Prevention.
McKinsey expressed regret for the firm’s role in the scandal.
“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 said in a statement. “We should have appreciated the harm opioids were causing in our society and we should not have undertaken sales and marketing work for Purdue Pharma.”
McKinsey has bolstered its risk management practices, it said, adding, “though we wish we had taken these steps sooner, we are committed to building on them to ensure that McKinsey sets the standard for accountability and compliance across our profession.”
Friday’s announcement comes about a week after US prosecutors in New York unveiled a nearly $123 million settlement with McKinsey and Co. Africa in a separate DPA, over charges the subsidiary paid bribes to South African officials to obtain lucrative consulting contracts.