McKinsey advised drug companies on how to 'turbocharge' opioid sales. Now it's under criminal investigation.
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- The Department of Justice is investigating McKinsey for advising opioid producers on boosting sales.
- The firm previously paid nearly $1 billion to resolve lawsuits related to its opioid work.
- The investigation is also looking at potential obstruction of justice by McKinsey and its employees.
Premier consultancy McKinsey & Company is under investigation by the US Department of Justice for its past work advising opioid manufacturers on how to juice sales, The Wall Street Journal reported on Wednesday.
The probe is also investigating whether the firm or its employees obstructed justice relating to record-keeping.
McKinsey has long been under scrutiny for its yearslong work with various drugmakers, including Purdue Pharma. The consultancy has paid nearly $1 billion to all 50 states, Native American tribes, local governments, and other groups to resolve a host of lawsuits without admitting wrongdoing.
Hundreds of thousands of Americans have died in the opioid crisis.
A spokesman for McKinsey declined to comment. The DOJ did not immediately respond to a request for comment sent outside normal business hours.
The DOJ investigation was years in the making. Former McKinsey client Endo, a pharmaceutical company, said in a regulatory filing that it received subpoenas about McKinsey in December 2020 and May 2021.
A grand jury has been set up in Virginia, and US attorney's offices in the Western District of Virginia and the District of Massachusetts are working together on the investigation, the Journal reported.
News of the investigation underscores how McKinsey's opioid work — which the firm said it stopped in 2019 — continues to plague the consultancy.
Project Turbocharge
McKinsey worked with opioid-producing drugmakers for decades, but its work ramped up as the opioid crisis took hold.
After Purdue pleaded guilty to misleadingly marketing OxyContin in 2007, for example, McKinsey created a plan called "Project Turbocharge" to boost sales. This plan involved doubling Purdue's marketing budget, lobbying doctors, and targeting medical practitioners who already wrote the most prescriptions for OxyContin, Seattle prosecutors wrote in a 2022 lawsuit.
Various lawsuits have surfaced internal McKinsey communications, including information about the firm's record-keeping practices. In a 2018 email, for example, a since-fired McKinsey executive wrote to another senior executive about the firm's legal risk.
"It probably makes sense to have a quick conversation with the risk committee to see if we should be doing anything other that [sic] eliminating all our documents and emails," the former McKinsey partner, Martin Elling, wrote. "As things get tougher here someone might turn to us."