Earlier this year, The Wall Street Journal reported that McKinsey was under criminal investigation by the Department of Justice (DOJ) for allegations that the consulting firm played a role in the United States opioid epidemic. Prosecutors with the DOJ are focused on McKinsey’s work advising Purdue Pharma and other drugmakers.
Prosecutors are investigating whether McKinsey engaged in a criminal conspiracy when advising Purdue and other manufacturers on marketing strategies to boost sales of prescription painkillers that led to widespread addiction and resulting overdoses. The DOJ is also investigating whether the company conspired to commit healthcare fraud when its consulting work allegedly resulted in fraudulent claims being submitted to government programs, including Medicare. Finally, prosecutors are considering whether McKinsey obstructed justice when it fired two partners who communicated about deleting documents related to their opioid consulting work.
As is often the case, an investigation is not evidence of any wrongdoing. Prosecutors can opt to seek civil sanctions, pursue criminal charges, or close the probe without taking action. However, the fact that the DOJ has opened this probe into McKinsey emphasizes the government’s interest in McKinsey’s past work of advising pharmaceutical companies on their opioid business. It is also higher stakes than prior government investigations into McKinsey because of the possibility of criminal charges against the company or its executives, as well as significant financial penalties that the DOJ often seeks in resolving its white-collar probes.
McKinsey and the DOJ declined to comment on the investigation. Sources knowledgeable of the probe indicate that the probe has been ongoing for several years and that both McKinsey and the DOJ are in discussions to resolve the probe.
“We understand and accept the scrutiny around our past client service to opioid manufacturers. This work, while lawful, fell short of the high standards we set for ourselves,” McKinsey said in an April 2022 statement following the release of a congressional committee report scrutinizing its consulting work.
Other Settlements
This probe, of course, is not the first time McKinsey is being taken to task for its role in the opioid epidemic. In 2021, McKinsey reached a $573 million settlement with 47 states, resolving allegations that it advised Purdue Pharma to increase sales of OxyContin. In late 2023, McKinsey paid $78 million to resolve claims by United States health insurers and benefit plans, resolving allegations that the company fueled the opioid epidemic. McKinsey also reached a $39.5 million settlement with federally recognized Tribes. Earlier in 2024, Judge Charles Breyer approved McKinsey’s proposal to pay $230 million to settle claims brought by municipal governments.