Skip to contents
Health

Colorado will receive nearly $10 million from McKinsey in consultant’s settlement for role in opioid crisis

The settlement includes 47 states, the District of Columbia and five U.S. territories

In this April 2, 2018 photo, pharmacist Steve Protzel poses for photos holding a bottle of OxyContin at Daniel's Pharmacy in San Francisco. (Jeff Chiu, AP file photo)

The global business consulting firm McKinsey & Company has agreed to a $573 million settlement over its role in advising companies on how to “supercharge” opioid sales amid the overdose crisis.

Nearly $10 million of that money will go toward Colorado, according to Colorado Attorney General Phil Weiser.

“I applaud McKinsey’s decision to step forward, accept responsibility, and work with us to address the opioid crisis,” Weiser said in a written statement. “They are the first company to work with the states to fix the problem rather than deny their conduct and engage in protracted litigation or delay.”

The settlement includes 47 states, the District of Columbia and five U.S. territories. Details of Colorado’s deal with McKinsey were filed in Denver District Court.

Weiser helped lead settlement negotiations with McKinsey and then lobbied other states to sign onto the agreement.

McKinsey, which made no admission of wrongdoing or liability as part of the settlement, said in a written statement to The Colorado Sun that it has taken steps to ensure a similar situation doesn’t happen in the future.

“As I have said previously, we are determined to take the steps necessary to strengthen our firm’s risk management policies and culture,” Kevin Sneader, global managing partner of McKinsey, said in a written statement. “We will build on the steps we have already taken to learn from past mistakes, and ensure we consistently meet the high standards our firm has always aspired to.”

Most of the money in the national settlement, which was first reported by The New York Times, would be sent to the states in less than a year, and would be used to abate the national overdose crisis.

The money will be paid in five installments, with the bulk of the money coming in the first payment, due sixty days from the effective date of the settlement, said Lawrence Pacheco, a spokesman for Weiser’s office.

Colorado’s $10 million portion of the settlement will go directly to local governments and regional groups to address the opioid crisis. Weiser’s office is working on a plan for how the money will be divvied up.

“For Colorado this is the first settlement dollars to address the opioid epidemic,” said Weiser at a joint news conference Thursday with attorneys general from Massachusetts, Oregon and New York. “We are working collaboratively, and the funds are going to be used primarily locally and regionally in communities like Alamosa.”

Prescription opioids and illegal ones such as heroin and illicit fentanyl combined have been linked to the deaths of more than 470,000 Americans since 2000. And the epidemic has deepened amid the coronavirus pandemic.

From 2000-2019, the rate of annual prescription overdose deaths in Colorado rose nearly 400%, according to Weiser’s office. During that time, nearly 5,000 Coloradans have died from a prescription opioid overdose.

State and local governments have been filing lawsuits over the past few years against companies that make and sell prescription opioids for their role in the crisis. But going after a consulting firm is a new wrinkle in the litigation.

McKinsey provided documents used in legal proceedings regarding OxyContin maker Purdue Pharma, including some that describe its efforts to help the company try to “supercharge” opioid sales in 2013, as reaction to the overdose crisis was taking a toll on prescribing.

Documents made public in Purdue proceedings last year include include emails among McKinsey. One from 2008, a year after the company first pleaded guilty to opioid-related crimes, says board members, including a Sackler family member, “‘blessed’ him to do whatever he thinks is necessary to ‘save the business.’”

“McKinsey’s work for opioid manufacturers extended beyond Purdue,” lawyers representing Colorado wrote in court documents. “McKinsey collected millions of dollars designing and implementing marketing programs for the country’s largest opioid manufacturers, including Johnson & Johnson and Endo, increasing the sale and use of opioids in Colorado.”

Purdue is in bankruptcy court to try to settle lawsuits against it. The company has proposed a settlement that could be worth $10 billion over time. The company last year also pleaded guilty to criminal charges in part of a settlement with the federal government. Both Purdue and members of the Sackler family who own the firm agreed to pay $225 million to the U.S. government as part of the deal.

A group of the largest drug distribution companies plus drugmaker Johnson & Johnson have also been working on a national settlement.

Colorado is also suing Purdue and the Sackler family over their alleged role in the opioid crisis. Additionally, Weiser’s office is involved in national settlement negotiations with other state attorneys general and opioid manufacturers and distributers.

“This shows what taking responsibility looks like…and I believe will absolutely motivate others to recognize their contributions and take seriously addressing the harm,” said Weiser at Thursday’s news conference. “Others need to follow suit.”

The Associated Press and Colorado Sun staff writers Jesse Paul and Thy Vo contributed to this report.

Rising Sun