McKinsey has consulted for the FDA and opioid drug companies simultaneously for years without reporting any conflicts of interest.
Since 2008, McKinsey & Company has been advising the Food and Drug Administration (FDA)’s drug regulation division and has been involved in numerous FDA projects. It was also brought to attention, in a very public way in 2019, that McKinsey has long consulted for opioid drug makers. According to the federal agency, McKinsey has never disclosed its confidential clientele, which is a problem based on current laws.
In 2019, some of McKinsey’s clients were revealed, including opioid giants such as Purdue Pharma and Johnson & Johnson. The relationship between the consulting firm and the FDA, and its simultaneous relationships with these companies could, in some instances, be considered conflict of interest. For example, McKinsey consultants helped Purdue and other opioid manufacturers to convince the FDA to relax a proposed opioid safety program a few years ago.
This year, a Freedom of Information Act request was submitted to the FDA seeking records demonstrating that McKinsey disclosed conflicts of interest to the agency’s drug regulation division. The agency responded that “after a diligent search of our files, we were unable to locate any records responsive to your request.” This was the reply despite the fact that U.S. government agencies must determine whether a contractor has any. Agency officials rely on disclosure to ensure they’re able to give proper consideration of whether to work with a contractor. If there is a serious conflict, this would preclude the contractor from doing so.
McKinsey’s contracts with the FDA excluded a standard provision obligating the firm to disclose to officials any conflicts, which seems confusing. One part of the contract reads, “The Contractor agrees it shall make an immediate and full disclosure, in writing, to the Contracting Officer of any potential or actual organizational conflict of interest or the existence of any facts that may cause a reasonably prudent person to question the contractor’s impartiality because of the appearance or existence of bias.” This suggests that McKinsey has a responsibility to bring this information to light.
Jessica Tillipman of George Washington University Law School explained, “Contractors have the obligation to disclose potential conflicts, and then the government has an obligation to figure out how to deal with it.” If this is the case, the FDA also held some responsibility for follow-through.
Neil Grace, a spokesperson for the McKinsey, said, “Across more than a decade of service to the FDA, we have been fully transparent that we serve pharmaceutical and medical device companies. McKinsey’s work with the FDA helped improve the agency’s effectiveness through organizational, resourcing, business process, operational, digital, and technology improvements. To achieve its mission, the government regularly seeks support from additional experts who understand both the government’s mission and the industries’ practices. We take seriously our commitment to avoid conflicts and to serve the best interests of the FDA.”
An FDA spokesperson, Shannon Hatch, added, “The FDA’s procurement activities are governed by the Federal Acquisition Regulations (FAR). The agency takes our role awarding contracts seriously and we work to ensure the agency maintains high standards of integrity as set forth in the FAR.”
Charles Tiefer, a professor of government contracting at the University of Baltimore Law School called ‘bull’ on both accounts, saying, “For a contractor like McKinsey not to disclose the companies it is working for has all the appeal of the Addams Family on Halloween hiding Uncle Fester in the basement so as not to scare the neighborhood.”
In short, whether the consulting firm is willing to admit it or not, at the very least, it was certainly operating in a grey area consulting to both the FDA and the pharmaceutical industry at the same time and weighing in on measures pertaining to the opioid crisis.