Consulting firm McKinsey & Co has reached a final settlement of $78 million to resolve claims made by U.S. health insurers and benefit plans. The allegations suggest that McKinsey played a role in the opioid epidemic by assisting drug companies, including Purdue Pharma, the maker of OxyContin. The settlement, disclosed in federal court papers in San Francisco, marks the conclusion of a series of legal actions against McKinsey related to its involvement in the U.S. opioid crisis.
Plaintiffs accused McKinsey, a prominent global consulting firm, of contributing to the opioid crisis by assisting drug manufacturers in designing deceptive marketing plans that allegedly fueled the epidemic of opioid addiction. Purdue Pharma, the maker of OxyContin, was specifically mentioned in connection with McKinsey’s involvement.
McKinsey has agreed to pay $78 million to resolve the claims made by U.S. health insurers and benefit plans. This settlement follows previous payments by McKinsey, including $641.5 million to resolve claims by state attorneys general and $230 million to settle claims by local governments. McKinsey has also resolved cases with Native American tribes.
The latest settlement is classified as a class action settlement, involving third-party payers such as insurers responsible for providing health and welfare benefits. The agreement is subject to the approval of a judge.
McKinsey, while not admitting wrongdoing, stated in a press release that it continues to believe its past work was lawful. The firm also highlighted its commitment, made in 2019, to no longer advise clients on any opioid-related business.
Paul Geller, a lawyer representing the plaintiffs, emphasized that the opioid crisis was caused by an oversupply of dangerous addictive drugs. The lawsuit aimed to recover funds spent on what they considered over-prescribed pills.
The opioid epidemic has led to thousands of lawsuits filed by states, local governments, and Native American tribes against drug companies, distributors, and pharmacies. Allegations include downplaying the risks of opioid painkillers and overlooking red flags of illegal trafficking.
The total settlements in the opioid litigation, including those with drugmakers, distributors, and pharmacy chains, have surpassed $50 billion.
According to the U.S. Centers for Disease Control and Prevention, nearly 645,000 people died in the United States from overdoses involving opioids (both prescription and illicit) from 1999 to 2021.
The U.S. Supreme Court recently heard a challenge by President Joe Biden’s administration to Purdue Pharma’s multi-billion-dollar bankruptcy settlement, which aimed to resolve related claims against the drugmaker.