Global Consulting Firm Settles Claims Linked to Opioid Crisis
In a landmark development, consulting giant McKinsey & Co has reached a $78 million settlement to address allegations from U.S. health insurers and benefit plans. The claims accused McKinsey of playing a significant role in the opioid epidemic by assisting drug companies, including Purdue Pharma, the maker of OxyContin.
The $78 Million Settlement
The settlement details were disclosed in documents filed on Friday in a federal court in San Francisco. This settlement stands as the final resolution in a series of legal actions McKinsey faced related to its involvement in the U.S. opioid crisis. The consulting firm has been under scrutiny for allegedly contributing to the epidemic by devising deceptive marketing plans and facilitating increased sales of painkillers for drug manufacturers.
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Previous Settlements
McKinsey has previously paid substantial amounts to settle opioid-related claims. This includes $641.5 million to resolve allegations brought by state attorneys general, an additional $230 million to settle claims by local governments, and agreements with Native American tribes.
Third-Party Payers Class Action Settlement
The recent class action settlement, subject to judicial approval, specifically addresses claims by third-party payers, such as insurers responsible for health and welfare benefits. Plaintiffs in the case argue that McKinsey’s actions added to the over-prescription of opioids, contributing to the widespread health crisis. Paul Geller, representing the plaintiffs, emphasized that the case aimed to recover funds spent on the over-prescribed pills.
McKinsey’s Response
Despite the substantial settlement, McKinsey did not admit any wrongdoing. In a statement, the consulting firm maintained that its past work was lawful. Notably, McKinsey had already committed in 2019 to cease advising clients on any opioid-related business.
Ongoing Opioid Crisis Litigation
The opioid epidemic has led to a flood of lawsuits against drug companies, distributors, and pharmacies. Accusations include downplaying the risks of opioid painkillers and overlooking red flags indicating illegal trafficking. The collective litigation has resulted in settlements exceeding $50 billion with various stakeholders in the pharmaceutical supply chain.
Alarming Statistics
The toll of the opioid crisis on public health is staggering, with nearly 645,000 deaths in the United States from opioid-related overdoses, both prescription and illicit, reported by the U.S. Centers for Disease Control and Prevention between 1999 and 2021.
Supreme Court Involvement
The U.S. Supreme Court recently addressed the opioid crisis, hearing a challenge by President Joe Biden’s administration regarding Purdue Pharma’s multi-billion-dollar bankruptcy settlement. This settlement aimed to resolve claims against the drugmaker related to its role in the opioid epidemic.
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