The number to know is $650m. That is what McKinsey will pay the U.S. Department of Justice to close out criminal charges tied to its work for Purdue Pharma, the maker of OxyContin.
The bottom line: this is a criminal resolution, not a civil one. Prosecutors charged the consulting firm with conspiring to misbrand a drug and with obstructing justice. They said McKinsey “knowingly and intentionally” helped Purdue “aid and abet the misbranding of prescription drugs… without valid prescriptions.” Part of the case rests on advice the firm gave Purdue on how to “turbocharge” OxyContin sales.
McKinsey has apologised. “We should have appreciated the harm opioids were causing in our society,” the firm said in a statement.
What the deal requires
McKinsey signed a deferred prosecution agreement. Under that kind of deal, prosecutors hold off on pursuing the case while the company makes reforms and meets other conditions. This one runs five years. If McKinsey keeps its side, prosecutors can move to dismiss the charges.
A former McKinsey senior partner, Martin Elling, is also due to plead guilty to obstruction. The allegation is that he destroyed records connected to the case.
The money already spent
The $650m is not the first payout. McKinsey previously settled lawsuits over its work with Purdue and other drug companies for nearly $1bn. Add the new figure and the firm’s total tab on opioids climbs well past $1.6bn.
Purdue itself pleaded guilty to criminal charges in 2020 as part of an $8.3bn settlement. It admitted to enabling the supply of drugs “without legitimate medical purpose.”
The market behind the case
Purdue brought OxyContin to market in the mid-1990s. One study found the drug made up 68% of oxycodone sales by 2002. Another found that by 2004, abuse of OxyContin and hydrocodone was the most common among eight opioids it examined.
The toll has been heavy. Overdose deaths in the U.S. have climbed for three decades, driven first by prescription painkillers and later by heroin and synthetics such as fentanyl. Nearly 100,000 people die of overdoses each year. In the 12 months to June 2024, the count was 97,000, down 14% from the year before.
