The head of McKinsey & Co. acknowledged that it failed to see the opioid epidemic unfolding while simultaneously doing work for drug regulators and makers of painkillers including OxyContin in his first appearance before lawmakers investigating the consulting firm’s actions.
“While our intent was not to fuel the epidemic, we failed to recognize the broader context of what was going on in society around us,” said Bob Sternfels, who assumed his role as global managing partner leading the 38,000-employee firm in July 2021. “That’s why we have new protocols and policies in place to prevent this happening again.”
Sternfels denied conflicts of interest in advising both the Food and Drug Administration and opioid makers including Purdue Pharma. He said an April 13 interim report by the House Committee on Oversight and Reform “took large speculative leaps” by focusing on the “time frame and not the nature of the work” McKinsey did for the FDA. The work focused on “administrative and operational topics” like business processes but didn’t involve opioid-related matters.
The committee’s investigation uncovered 37 FDA contracts that were staffed by at least one McKinsey consultant who simultaneously or previously worked for Purdue, according to the report. On Tuesday, an FDA official said it had stopped contracting with McKinsey while lawmakers continue their probe.
Massachusetts Attorney General Maura Healey, who’s been investigating McKinsey’s ties to Purdue for several years, fired back at Sternfels by saying the consulting firm “absolutely” undermined drug safety and worsened the epidemic.
She said that in 2008, McKinsey “actively coached” Purdue to join with other drug makers to undermine an FDA proposal to impose stricter requirements on opioid sales, which was never implemented. She also discussed McKinsey’s previously disclosed work to “turbocharge” sales of the opioid OxyContin by “relentlessly targeting doctors” who wrote the most prescriptions.
“It’s infuriating,” Healey said. “They even went so far as to get in the car with Purdue reps to pitch OxyContin to doctors.”
McKinsey has agreed to pay $641 million to settle claims by U.S. states that the consulting firm helped fuel the country’s opioid epidemic by providing sales analysis and marketing advice to makers of the highly addictive painkillers, including Purdue and Johnson & Johnson. In 2019 McKinsey said it would stop working with Purdue.
“McKinsey’s conflicts and conduct are among the worst I have seen in my years in government,” Carolyn Maloney, a Democrat from New York who chairs the oversight committee, said in an opening statement to the hearing.
Aggressive Strategy
“Cash prize,” “celebrity status” and “unrivaled recognition” were among the rewards dangled by McKinsey to Purdue’s salespeople if they followed the consulting firm’s aggressive strategy to boost prescriptions of the OxyContin, according to documents shared between the two companies that were released Wednesday as part of the congressional investigation into the firm’s role in advising the drug maker.
Sternfels said that he would “work fully with the committee to answer all questions” but didn’t have responses to some of the lawmakers’ questions Wednesday, including what other opioid makers McKinsey worked for beyond Purdue and J&J. “We demand accountability and will not stop until we get it,” Maloney said.
Katie Porter, a Democrat from California, asked Sternfels why McKinsey didn’t let the FDA decide whether its concurrent work for the drug regulator and for Purdue, which often involved the same consultants, was a conflict of interest. “Who made you conflict-of-interest czar for the U.S. government?” she said.
Lawmakers also grilled Sternfels about a Sept. 2013 slide from a presentation titled “OxyContin growth opportunities,” in which McKinsey outlined its so-called “Wildfire” sales strategy to increase the number of sales calls made to certain doctors to boost the amount of prescriptions written in markets like Wareham, Mass.
The presentation included multiple images of Donald Trump’s television show “The Apprentice,” then a hit program, to illustrate how “top performers” on Purdue’s sales force could earn prestige across the company, along with “significant rewards” such as cash.
“I know you all wear suits and don’t consider yourselves drug traffickers,” Rashida Tlaib, a Democrat from Michigan, said to Sternfels. “But you were doing the same freaking thing.”