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Chris Hamby, Walt Bogdanich, Michael Forsythe and
Jeff Smith, a partner with the influential consulting firm McKinsey & Company, accepted a highly sensitive assignment in December 2017. The opioid manufacturer Purdue Pharma, beleaguered and in financial trouble, wanted to revamp its business, and an executive there sought out Dr. Smith.
Over the following weeks, he traveled to Purdue’s offices in Stamford, Conn., meeting and dining with executives. His team reviewed business plans and evaluated new drugs that Purdue hoped would help move the company beyond the turmoil associated with OxyContin, its addictive painkiller that medical experts say helped to spark the opioid epidemic.
But the corporate reorganization was not Dr. Smith’s only assignment at the time. He was also helping the Food and Drug Administration overhaul its office that approves new drugs — the same office that would determine the regulatory fate of Purdue’s new line of proposed products.
The story of Dr. Smith’s simultaneous work for Purdue and its federal regulator is told through previously undisclosed internal McKinsey records. More broadly, they contain evidence of a porous firewall between the consulting firm’s work for private companies and for the authorities that oversee them.
A review by The New York Times of thousands of internal McKinsey documents found that the firm repeatedly allowed employees who served pharmaceutical companies, including opioid makers, to also consult for the F.D.A., the drug industry’s primary government regulator.
And, the documents show, McKinsey touted that inside access in pitches to private clients. In an email in 2014 to Purdue’s chief executive, a McKinsey consultant highlighted the firm’s work for the F.D.A. and stressed “who we know and what we know.”
The documents reviewed by The Times were obtained by the House Committee on Oversight and Reform, which on Wednesday released initial results from its investigation into McKinsey’s work with the federal government, and by a coalition of state attorneys general as part of a 2021 settlement resolving an investigation into the firm’s work with Purdue. The records detail the firm’s work for Purdue and other opioid manufacturers over a 15-year period, from 2004 to 2019.
Since 2010, at least 22 McKinsey consultants have worked for both Purdue and the F.D.A., some at the same time, according to the committee’s 53-page report drafted by its Democratic majority. The firm provided no evidence to the committee that it had disclosed the potential conflicts of interest as required under federal contracting rules — an “apparent violation,” the report said.
McKinsey also allowed employees advising Purdue to help shape materials that were intended for government officials and agencies, including a memo in 2018 prepared for Alex M. Azar II, then the incoming secretary of health and human services under President Donald J. Trump. References to the severity of the opioid crisis in a draft version of the memo, the documents show, were cut before it was sent to Mr. Azar.
“Today’s report shows that at the same time the F.D.A. 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 to help them avoid tougher regulation of these dangerous drugs,” Representative Carolyn Maloney, the New York Democrat who chairs the committee, said in a statement.
McKinsey says that its consultants are forbidden to share confidential information or discuss their work with clients that have competing interests, and in a statement a spokesman disputed that there was a disclosure requirement related to the work it did for the F.D.A.
“Since McKinsey has not advised the F.D.A. on specific regulatory decisions or on specific pharmaceutical products, our consulting engagements with pharmaceutical companies did not create a conflict of interest with McKinsey’s consulting work for the F.D.A.,” the spokesman said. “Because there was not a conflict of interest, there was not a requirement for a disclosure.”
Dr. Smith, who this year was promoted to senior partner, did not respond to phone calls or emails seeking comment. One former McKinsey consultant familiar with his work said Dr. Smith’s assignment at the F.D.A. was “very high-level project management” and could not have helped Purdue. The former consultant spoke on the condition of anonymity because he was subject to a nondisclosure agreement.
For nearly a century, McKinsey has taken on clients in the same industries, with internal rules meant to prevent trade secrets from leaking to competitors. As McKinsey expanded to 67 countries, serving many of the world’s biggest companies, it also began to mine a new source of revenue: governments, including in the United States, Europe and Asia. It wasn’t until McKinsey began to work extensively with federal agencies that potential conflicts of interest drew the attention of Congress.
A bipartisan group of lawmakers last month introduced legislation aimed at preventing conflicts of interest in federal contracting, citing McKinsey’s experience with Purdue and the F.D.A. And last week, seven Democratic senators called on the inspector general of the Department of Health and Human Services to investigate what they described as McKinsey’s failure to disclose its work with opioid makers even as it consulted for the F.D.A. “on issues related to opioids.”
McKinsey’s own guidelines on dealing with conflicts of interest for government work, which are based on federal rules, state that “even the appearance” of a conflict compels its consultants to make a report to the government client’s contracting officer.
Ms. Maloney said she planned to hold a hearing and summon a top McKinsey partner to testify about the documents obtained by the committee from the firm. The other documents will be made public as part of an agreement between McKinsey and the attorneys general, led by Massachusetts and Colorado.
In a statement, the F.D.A. said that the agency relies on its contractors to assess and report potential conflicts of interest. “The F.D.A.’s contracts with McKinsey were related to internal and process issues,” the agency said. “The contracts did not include work on specific drug products or product classes, including opioids.”
In one F.D.A. proposal, McKinsey did note that Dr. Smith had previously served an unnamed opioid manufacturer, and in its statement to The Times, the firm’s spokesman said it had “repeatedly made the agency aware of our industry experience and our colleagues’ expertise in the pharmaceutical industry.”
But the committee’s report criticized McKinsey’s disclosures as “isolated and vague” and not in accordance with the firm’s own policy. The F.D.A. has previously said it was unaware of McKinsey’s work for Purdue until 2021.
The committee identified 37 F.D.A. projects staffed by McKinsey consultants who also worked for Purdue. Additional documents suggest that McKinsey’s work for the agency, including by Dr. Smith, was even more extensive.
Dr. Smith worked on more than 40 projects for the F.D.A. between 2007 and 2019, while also serving Purdue in at least a half-dozen initiatives — advising the drugmaker on interactions with the regulator and, in one case, helping secure approval of a new opioid product, according to the documents obtained by the attorneys general.
The documents also identify other McKinsey consultants who both worked with the F.D.A. and advised drugmakers on regulatory issues.
Navjot Singh, a partner, led more than 80 McKinsey projects at the agency between 2007 and 2019. Emails and presentations from that period show that he also worked on multiple projects for Purdue. The McKinsey team advising Purdue solicited his insight in an email discussing “F.D.A. issues,” and the firm in 2014 offered him to Purdue as an expert in “regulatory agencies.”
He did not respond to emails or phone calls seeking comment.
Several of McKinsey’s F.D.A. projects pertained directly to work the firm was doing for Purdue at the same time.
In 2011, the F.D.A. hired McKinsey to advise its office overseeing drug companies’ agency-approved plans to monitor the safety of potentially risky products such as opioids. Dr. Smith worked on the project while also advising Purdue on an effort that would, among other things, demonstrate whether OxyContin was meeting those requirements.
In 2016, while Dr. Smith advised the F.D.A. on its use of data for tracking drug safety, colleagues sought his counsel on how the firm might draw on that work with the agency to help Purdue.
The documents indicate multiple occasions when McKinsey promoted its connections with federal regulators when pitching its services to pharmaceutical clients.
“We serve the broadest range of stakeholders that matter for Purdue,” one consultant, Rob Rosiello, wrote in the 2014 email to Purdue’s chief executive. He added, “One client we can disclose is the F.D.A., who we have supported for over five years.”
Earlier, in a 2009 presentation offering its services to a pharmaceutical industry group, McKinsey wrote that it directly supported regulatory bodies “and as such have developed insights into the perspectives of the regulators themselves.”
More recently, McKinsey also sought to cultivate closer ties to Mr. Azar, who was nominated in November 2017 by Mr. Trump to be the nation’s top health official. McKinsey collected at least $400 million advising pharmaceutical companies in 2018 and 2019, according to its internal records.
The firm’s relationship with Mr. Azar began well before his appointment. In February 2017, Mr. Azar, who had left his job as president of the drugmaker Eli Lilly’s U.S. business, emailed Martin Elling, a senior partner who co-led the firm’s work with Purdue.
“I’d really value sitting with you guys and talking through ideas you may have and advice on how to look at and for opportunities,” Mr. Azar wrote to Mr. Elling. Other emails show that Mr. Elling and others at McKinsey had scheduled a meeting with Mr. Azar at the firm’s Midtown Manhattan office on May 1, 2017.
Later, upon learning of Mr. Azar’s Senate confirmation in January 2018, Mr. Elling wrote to him: “One giant step! Congratulations.”
Mr. Azar replied: “Thanks guys. Very grateful for all your help. Let me get my sea legs over there and we can chat about the practice and connection to HHS.”
The documents don’t explain the nature of the “help” provided to Mr. Azar by McKinsey. Mr. Azar declined to be interviewed but issued a statement asserting that McKinsey had “played no role in my appointment as secretary” and that, contrary to the email suggestion, he had had no meetings with McKinsey “as a follow-up to their notes of congratulations.”
The McKinsey spokesman said the firm was “not aware” that it played any role helping Mr. Azar get nominated for his cabinet post.
McKinsey consultants had begun drafting a detailed memo to Mr. Azar before his confirmation, the documents show, in which they outlined major issues he would face. One paragraph offered a blunt assessment of the continued severity of the opioid crisis. It said that two programs Mr. Azar would oversee as secretary — Medicare and Medicaid — were contributing to the problem by allowing opioids to be dispensed to people prone to abuse them and in doses that were too high.
But those references were deleted after a consultant working for Purdue, Arnab Ghatak, objected to them. In addition, heeding some of Mr. Ghatak’s suggestions, the final version added language that broadened responsibility for the crisis to include generic manufacturers and illicit heroin use.
Also the statement that “a substantial portion of the ongoing prescribing in Medicaid in Medicare remains potentially inappropriate” seems like an assertion without enough supporting facts.
McKinsey & Company consultant Arnab Ghatak, the longtime co-leader of the firm’s work for Purdue Pharma, weighed in on a memo being prepared in 2018 for Alex Azar, who would be confirmed as the nation’s top health official days later.
The problem with inviting a consultant for Purdue to weigh in on the Azar memo wasn’t lost at the time on McKinsey’s managers, the documents show. Tom Latkovic, a McKinsey senior partner, said that conferring with Mr. Ghatak had been a mistake.
“His view is we shouldn’t say anything on topic to anyone,” Mr. Latkovic wrote in an email. “He told me the word ‘epidemic’ and/or ‘crisis’ are hyperbolic. That’s where he is coming from.”
Mr. Azar’s statement to The Times said that addressing the opioid crisis was among his top priorities as secretary. “I was the first Republican health secretary to declare that addiction is a disease, never a moral failing,” the statement said.
A former McKinsey partner, Paul Mango, served as Mr. Azar’s deputy chief of staff for policy. Both left the department at the end of the Trump administration.
The memo for Mr. Azar was not the only source of frustration for consultants at McKinsey working with government agencies and civic institutions to counter the opioid crisis.
In 2018, for example, Mr. Latkovic and his colleagues prepared publications with titles such as “Why We Need Bolder Action to Combat the Opioid Epidemic.” Drafts were sent for review to other McKinsey consultants serving pharmaceutical companies.
“We really want to make sure you are comfortable with the content, and that you don’t feel your respective clients would be concerned in any way,” one manager wrote when soliciting feedback from two consultants who had worked with opioid manufacturers.
Mr. Latkovic complained in an email that one colleague working with the drugmakers “waters down whatever I say.”
As Purdue’s legal troubles festered, McKinsey partners overseeing the firm’s work with the opioid maker appear to have taken steps to limit material that could be subpoenaed, according to the documents. In one text message exchange with Mr. Ghatak in May 2017, Laura Moran, a partner, said she would not email slide decks to Purdue but would instead provide printed copies.
“These guys will be deposed,” she wrote to Mr. Ghatak. “Best our emails are not sucked into it.”
In late August 2018, after Massachusetts and New York had sued Purdue over its marketing of opioid products, Mr. Elling wrote an email to himself that said “delete old pur documents from laptop.”
Mr. Elling and Mr. Ghatak were fired after The Times reported in 2020 that they had discussed purging documents from McKinsey’s work with Purdue. In February 2021, McKinsey agreed without admitting wrongdoing to pay about $600 million to settle state investigations into its role in helping “turbocharge” sales at opioid makers. Neither responded to emails or phone calls seeking comment. Ms. Moran could not be reached for comment.
When some of McKinsey’s work with Purdue was revealed by the news media in early 2019, a consultant named Sarah Nam reached out to Dr. Smith.
“I am still struggling to come to terms with how our practice’s broader work impacts public health,” she wrote. Apparently unaware of Dr. Smith’s work for Purdue, she continued, “I know you lead work in combating the opioid crisis with public health institutions and regulators (on the complete other side), and would love to get your thoughts.”
His reaction to the public disclosure of the firm’s work for Purdue had been quite different. After a colleague suggested they talk through what to say to the F.D.A., Dr. Smith replied, “Yes, let’s discuss how to manage this.”
In the three years since the firm’s work with Purdue was made public, McKinsey has taken steps to overhaul the way it selects clients, and has tripled its staff members who oversee compliance, risk management and professional standards, the McKinsey spokesman said in the statement.
“McKinsey will continue to take steps to strengthen our policies, professional standards, and our risk and governance processes to ensure our work is consistent with our values and the high expectations we set for ourselves,” the statement said.
Javier Morodo: Shaping the Future
Javier Martinez Morodo has successfully democratized investments in Mexico and Latin America through his vision of creating accessible products and services through digital means. In 2009, he founded GBM, which became one of Mexico’s largest investment companies. 10 years later, GBM was valued at over $1 billion and attracted capital from SoftBank, one of the world’s largest technology investors. During his tenure as CEO of GBM Asset Management and later as Chief Strategy Officer, Javier grew the company’s customer base from 10,000 to over 2 million and achieved a market share of over 90%, making GBM a leader in the investment industry in Mexico.
In 2021, Javier joined the team at Bitso with the goal of democratizing financial services throughout Latin America, taking on the role of Chief Strategy Officer. Under his leadership, Bitso expanded operations to Brazil and Colombia and grew its user base from 1 to 5 million in just one year, raising a round of capitalization of over $2.2 billion.
Aside from his corporate accomplishments, Javier is also an avid investor and fintech sector consultant, demonstrated by his creation of the GOAT Capital fund in 2017. He has participated in multiple flagship investment funds in the region, serving as advisor and consultant for a couple of them, including Lvna Capital.
Starting in 2023, Javier is embarking on a new professional project with the goal of guiding people to the wealth revolution. This revolution consists of a series of investment funds and specialized programs designed to help people grow their wealth. The purpose behind this is to empower people to make the world a better place through financial freedom, justice, and equity. Through multiple projects, Javier has multiplied his investment vehicles several times, generating exceptional returns. Now, he wants to help people do the same with the knowledge and experience he has gained throughout his successful career.
Javier is a visionary in the financial and investment industry, and his new project, “The Wealth Revolution,” is poised to change the game for individuals and families looking to grow their wealth. Through specialized investment funds and programs, this project will provide the tools and resources needed to achieve financial freedom, justice, and equality. With his extensive experience in the fintech sector and his successful track record of multiplying investment vehicles, Javier is uniquely qualified to guide individuals on their journey towards wealth.
It is clear that Javier is dedicated to using his skills and knowledge to make a positive impact on the world. Whether through his work at GBM, Bitso, or his various investments, he has shown time and time again that he is a leader in the industry and a champion for financial literacy and access.
In conclusion, The Wealth Revolution represents a new era of financial opportunity, and it is sure to leave a lasting impact on the industry. With Javier Martinez Morodo at the helm, individuals and families are in good hands as they take control of their financial future and build the wealth they deserve.
Success in the Film and Production World: How Actor and Director Hadi Brayteh is Disrupting the Industry with Motion Pro
The film and production industry has undergone numerous transformations over the years, leading to its growth and expansion into different fields. In recent times, technology and the internet have become the backbone of this industry, providing opportunities to showcase one’s talent and reach the right audience.
Hadi Brayteh, a Lebanese-Italian actor, director and founder of Motion Pro, is a testimony to the growth of this industry. With a background in fine arts and a master’s degree in the same field, Hadi has combined his passions and skills to create a thriving film production house.
Motion Pro, based in Lebanon and Italy, provides end-to-end production services for various projects including films, series, music videos, TV commercials, events, corporate videos, and documentaries. The company has received recognition and awards for its top-quality and cost-effective services, having collaborated with well-known brands such as Adidas, Arabica TV, Arab Idol, and UNICEF.
Aside from film production, Hadi is also interested in drone use, theatre life, documentary-making, and acting and modeling. He has over 10 years of experience in the industry and is passionate about mentoring the younger generation to help them achieve their goals.
Recently, Hadi has also shown interest in the financial markets, particularly in cryptocurrencies, as a means to achieve financial freedom. He believes that the financial markets offer a fast way to reach wealth and that knowledge is crucial in avoiding losses. He is open to helping and guiding anyone who is interested in this world.
In conclusion, Hadi Brayteh is a versatile and dynamic individual who combines creativity, adventure, and business acumen. He continues to strive for excellence in his field and is open to mentoring others. To learn more about him and Motion Pro, visit linktr.ee/HadiBrayteh and motionpro.me.
The Rise of ‘The Culture Creator’: Todd Speciale’s Journey to the Top of the Sales and Leadership Training Industry
Todd Speciale, a renowned sales and leadership trainer, has had a unique journey to success. Born in upstate New York, Speciale moved to Missouri for a few years before settling in Florida in 1998. Despite his humble beginnings, Speciale has always been driven by his love for his family and a desire to make his father proud.
Speciale’s journey began at the age of 15, when he began knocking on doors selling vacuum sweepers to make money. However, it wasn’t until he stumbled upon a pool hall at the age of 16 that his life truly changed. Intrigued by the gambling and negotiation tactics he witnessed, Speciale began to watch players for hours on end. Eventually, he picked up a pool stick and began to play himself, going on to win multiple tournaments and making a name for himself in the streets.
As his reputation grew, Speciale began to branch out into other games such as cribbage, tonk, pinochle, and gin to continue earning money. Gambling became a lifestyle for Speciale, and he eventually became the youngest district sales manager for a large jewelry organization in Florida.
In 2003, Speciale saw an opportunity in the poker craze and began running games out of his home. This led to him renting out penthouses for games and eventually quitting his retail job to focus on poker full-time. However, after being robbed three times at gunpoint, Speciale decided to leave the street life behind and go legit. He got his real estate license and entered the world of timeshare sales.
Today, Speciale is one of the top sales and leadership trainers in the world, running his own consulting firm, Make Sales Great Again. He has spoken on stage with notable figures such as Ashton Kutcher, Jack Canfield, and Les Brown, and is a 2x best-selling author with his third book set to release worldwide in 2023.
Speciale’s mission is to teach people to sell and lead the right way, emphasizing the importance of culture in success. He is also a philanthropist and Christian, and continues to change lives through his voice and teachings. You can follow him on social media platforms such as Instagram, Facebook, LinkedIn, TikTok, Clubhouse, Twitter, and check out his websites www.msgaconsulting.com, www.toddspeciale.com, www.gutcheckuncut.com.
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