Today U.S. Senator Josh Hawley (R-Mo.) sent a letter to McKinsey & Company Global Managing Partner, Kevin Sneader, blasting the company for their proposal to ensure sales of Purdue Pharma’s OxyContin by paying pharmacies bounties for opioid overdoses. Senator Hawley says that McKinsey may have committed federal crimes as a co-conspirator of Purdue and by possibly destroying evidence relevant to potential government investigations.
“McKinsey’s abhorrent conduct also demands that Congress consider broader action. McKinsey earns billions of dollars from contracts with the federal government. No firm that proposes paying kickbacks for overdose deaths should receive a single cent from U.S. taxpayers. In light of McKinsey’s possible active role in driving the opioid crisis, Congress must consider whether to impose obligations on consulting firms to report criminal activity or specific criminal penalties for consultants playing a role in federal crimes.”
Senator Josh Hawley
Senator Hawley requested that, by December 15, McKinsey state whether personnel discussed destroying evidence related to their work with Purdue, whether any evidence was in fact destroyed, and any disciplinary action taken against McKinsey personnel for their role in the project.
Senator Hawley has previously called for the federal government to provide additional resources to combat the overdose crisis in Missouri and, as Missouri Attorney General, filed suit against opioid manufacturers—including Purdue—for violating consumer protection laws.
Read the full letter here or below.
December 1, 2020
Mr. Kevin Sneader
Global Managing Partner
McKinsey & Company
3 World Trade Center
175 Greenwich Street
New York, New York 10007
Dear Mr. Sneader:
I read with disgust the recent New York Times article McKinsey Proposed Paying Pharmacy Companies Rebates for OxyContin Overdoses. The opioid epidemic has claimed the lives of hundreds of thousands of Americans and destroyed countless families and communities. Fighting the scourge of opioid addiction and death has been among my top priorities as an elected official. As Missouri Attorney General, I sued the leading opioid manufacturers—including Purdue Pharma—for their role in creating and profiting from this crisis.
The Times reports that McKinsey recommended paying a $14,810 bounty to pharmacies for each opioid addiction or overdose (what your consultants called an “event”) to ensure that pharmacies would not stand in the way of Purdue’s quest to “turbocharge” its sales of the lethal drug. The Times further reports that once McKinsey learned of government investigations into Purdue’s misconduct, two senior McKinsey consultants—Martin Elling and Arnab Ghatak—discussed destroying evidence of McKinsey’s consulting work in an effort to avoid government scrutiny.
If this reporting is accurate, McKinsey has engaged in startlingly unethical conduct. Such conduct would also appear to constitute federal crimes. From the recently filed settlement agreement between the Government and Purdue Pharma, there are serious questions about whether McKinsey is guilty of the federal crimes to which Purdue recently pled guilty, either as a co-conspirator or by aiding and abetting those crimes. Moreover, allegations that Mr. Elling and Mr. Ghatak discussed destroying evidence relevant to pending government investigations raises the prospect that McKinsey may also have engaged in obstruction of justice. These issues must be reviewed by the appropriate law enforcement authorities, and they also fall within the jurisdiction of the Senate Judiciary Committee’s Subcommittee on Crime and Terrorism, of which I am the Chairman.
McKinsey’s abhorrent conduct also demands that Congress consider broader action. McKinsey earns billions of dollars from contracts with the federal government. No firm that proposes paying kickbacks for overdose deaths should receive a single cent from U.S. taxpayers. In light of McKinsey’s possible active role in driving the opioid crisis, Congress must consider whether to impose obligations on consulting firms to report criminal activity or specific criminal penalties for consultants playing a role in federal crimes. McKinsey’s apparent efforts to destroy evidence of its conduct suggests that Congress must impose additional recordkeeping and document-retention obligations on consulting firms to ensure that they do not facilitate illegal activity.
To aid Congress in assessing the need for immediate legislative action, please provide the following information on or before December 15, 2020.
- State whether McKinsey personnel proposed paying rebates based on overdose deaths or the development of opioid use disorder, as alleged in the New York Times article.
- State whether McKinsey personnel discussed destroying evidence relating to McKinsey’s consulting work for Purdue Pharma, as alleged in the New York Times article. If so, produce all internal correspondence reflecting such discussions.
- State whether McKinsey personnel in fact destroyed any evidence relating to McKinsey’s consulting work for Purdue Pharma. If so, identify and describe all documents and other data that were destroyed.
- Identify all McKinsey personnel involved in the firm’s consulting work for Purdue Pharma.
- State the total amount of money that McKinsey earned from its consulting work for Purdue Pharma.
- State the total amount of money that McKinsey earned from its consulting work with any firm, in the United States, China, or elsewhere, involved in the development, manufacture, distribution, or sale of opioids.
- Describe all disciplinary action taken against any McKinsey personnel—including but not limited to Mr. Elling and Mr. Ghatak—for their role in actively advancing the opioid crisis and/or obstructing government investigations relating to Purdue Pharma or the opioid crisis.
- Describe all internal policies that are intended to prevent McKinsey from facilitating or participating in unlawful activity, and explain in detail why those policies did not prevent the conduct described in the New York Times article.
It is high time that McKinsey took responsibility for the immense harm that it has caused and enable Congress to prevent similarly tragic consequences in the future.
Sincerely,
Josh Hawley
United States Senator