Global consulting firm McKinsey & Company has agreed to contribute US$125 million to Purdue Pharma’s bankruptcy settlement. This accord resolves potential legal claims against McKinsey regarding advice it provided to Purdue on boosting sales of its highly addictive painkiller, OxyContin. Purdue Pharma, an American pharmaceutical company, manufactures OxyContin and has faced scrutiny for allegedly fuelling the U.S. opioid epidemic. With a US$7.4 billion restructuring plan approved in November, Purdue will use these funds to compensate creditors.
McKinsey’s contribution finalises these claims without admitting wrongdoing. The firm previously paid US$1.6 billion in settlements with U.S. authorities over its opioid crisis involvement, and ceased advising clients on opioid-related businesses in 2019, expressing deep regret for its past counsel. This latest settlement adds US$50 million to the expected recovery for individuals harmed by the opioid crisis, a group initially projected to receive approximately US$865 million.
The broader Purdue settlement allocates most funds to states and local governments for opioid abatement efforts like addiction treatment. The Sackler family, Purdue’s owners, are contributing at least US$6.5 billion to the overall bankruptcy settlement. Purdue has twice pleaded guilty to federal criminal charges of falsely marketing OxyContin, acknowledging it misled about addiction risks. Its sentencing for the second guilty plea is set for April 21. Post-bankruptcy, Purdue will transform into Knoa Pharma, a non-profit focused on developing and distributing opioid overdose reversal and addiction treatment medications. The entire settlement requires U.S. bankruptcy judge approval at an April 30 hearing. If approved, McKinsey will pay US$65 million next month and the remaining US$60 million in 2027.
