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Report sheds light on McKinsey’s alleged conflicts of interest

(WASHINGTON) — House committee investigators found that consultants from consulting firm McKinsey & Company advised opioid manufacturers while the company was on federal contract with the Food and Drug Administration’s drug approval unit, an arrangement that lawmakers say may have breached federal conflict of interest rules, according to an interim report published Wednesday.

According to the report published by the House Oversight Committee, McKinsey consultants allegedly leveraged their work with the FDA to attract business from companies like Purdue Pharma, one of the leaders in developing opioid drugs. And according to the interim report, McKinsey consultants appear to have tried to influence government officials to benefit their opioid clients, raising questions about the company’s firewall between government contracts and private sector work.

At the same time the FDA was relying on McKinsey’s advice to ensure drug safety and protect American lives, the firm was also being paid by the very companies fueling the deadly opioid epidemic by allegedly helping to defend opioid manufacturers against tougher regulation of these dangerous drugs, Rep. Carolyn Maloney, D-N.Y., the committee’s chair, wrote in a statement.

Maloney called McKinsey’s conduct particularly “egregious considering its central role in driving a public health crisis that has killed half a million Americans.”

McKinsey, in response to the new release, wrote in a statement that it “will review the report” and “continue to cooperate with the Committee to address further questions,” but defended its work for the FDA and for its opioid clients, saying it is committed to guarding against conflicts of interest.

In the statement, McKinsey wrote that it reviews its potential conflicts and “will not do the work” if those potential conflicts “cannot be appropriately addressed.” It said its work for the FDA were administrative and operational, “including improvements to organizational structures, business processes and technology,” not related to regulatory decisions or specific pharmaceutical products.

But the firm, in the statement, also admitted that its past private sector opioid work — which it stopped in 2019 — while lawful, “fell short of the high standards we set for ourselves” and that it settled with all 50 state attorneys general to “provide fast, meaningful support to communities across the United States that have been affected by the opioid crisis.”

The new House committee report, in particular, sheds light on questions about the firm’s conflicts of interest policies, including details about at least 22 McKinsey consultants who allegedly worked for both the FDA and opioid manufacturers on related topics, sometimes at the same time.

For example in 2011, at least four McKinsey consultants that were working on a $1.8 million FDA contract to address “the adverse impact of drugs on health in the US” were working for Purdue at the same time, “including on projects designed to persuade FDA of the safety of Purdue’s opioid products,” the committee found, according to the report.

In 2017, a McKinsey partner allegedly worked on a $2.7 million contract to help modernize the FDA’s Office of New Drugs while at the same time advising Purdue on maximizing the market potential of a new opioid, according to the report.

The report also alleged that McKinsey consultants with Purdue ties attempted to influence public health officials in the Trump Administration on the topic of the opioid epidemic.

The committee wrote that some of McKinsey consultants “formed part of what one consultant called McKinsey’s mini ‘army’ here at Purdue,” suggesting McKinsey’s cozy relationship with Purdue during the time period when “numerous McKinsey consultants worked for both FDA and Purdue, both officially and unofficially.” But the report didn’t say whether the particular McKinsey consultant that used the phrase “mini army” was also working on FDA projects.

The committee report also looked at McKinsey’s alleged lack of its potential conflicts of interest disclosures to the FDA, saying the lack of disclosure potentially violated contract requirements and federal law.

McKinsey spokesperson Neil Grace has previously told ABC News Mckinsey had made necessary conflict of interest disclosures, saying that the company’s consulting work for pharmaceutical firms “did not create a conflict of interest” regarding its work with the FDA, because it “has not advised the FDA on regulatory policy or on specific pharmaceutical products,” and “given the absence of a conflict of interest, there was no requirement for any McKinsey disclosure.”

In recent weeks, lawmakers have increasingly trained their sights on McKinsey and other contractors for allegedly accepting government contracts while pursuing outside business opportunities that may present a conflict of interest.

Earlier this month, Senate Democrats called on the Department of Health and Human Services inspector general to investigate McKinsey over alleged conflict of interest violations tied to its work with major pharmaceutical companies.

Lawmakers have also introduced legislation meant to strengthen conflict of interest safeguards for contractors like McKinsey.

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