School Districts Sue McKinsey & Co. Over Opioid Epidemic

School districts across the country, including in Florida, are targeting a consulting company that they allege helped “turbocharge” sales of highly addictive pain medications, almost a year after the firm agreed to fork over money to states amid widespread litigation over the opioid epidemic.

With the school board in rural Putnam County as the lead plaintiff, a class action lawsuit was recently filed on behalf of Florida school districts against McKinsey & Co. Inc. and its affiliates. The case alleges the global firm’s advice to opioid manufacturers harmed children and increased educational costs.

The Florida challenge mirrors similar class-action lawsuits filed by school districts in West Virginia and Kentucky as part of a complex lawsuit against McKinsey being overseen by a federal judge in Northern California.

The complaints maintain that schools have been hit especially hard by the opioid epidemic, as the need for special education and other support services skyrocketed along with rising rates of addiction and overdoses in families.

The lawsuits accuse McKinsey of having “played a central role in the unfolding, propagation, and exploitation of the opioid crisis by advising multiple opioid manufacturers and other industry participants on how to sell as many opioids as conceivably possible.”

As opioid sales began to drop because of public health concerns, McKinsey developed plans to “turbocharge” sales for manufacturers including Purdue Pharma, the maker of OxyContin, court records allege.

McKinsey last year agreed to pay more than $600 million to 50 states, five territories and the District of Columbia to settle litigation over its role in the epidemic. Florida is slated to receive about $40 million under the settlement, state Attorney General Ashley Moody announced in February. While reaching the settlement, McKinsey denied wrongdoing.

Schools, however, won’t directly benefit from the states’ settlement with McKinsey, Wayne Hogan, a Jacksonville attorney who is on the legal team representing Florida school districts, told The News Service of Florida in a phone interview.

Meanwhile, he said schools are providing “mitigation and abatement services” to students who were affected by the opioid crisis, as required by federal law.

“This is something they have to do. It’s something they should do. But the taxpayers of the communities are paying for this. To the extent that this has been imposed by the opioid industry, McKinsey included, on the school districts, it is appropriate for these efforts to be supported by funding out of any settlement or trial verdict or resolution that occurs,” said Hogan, who was a key player in the state’s litigation against the tobacco industry two decades ago.

The Florida case has been combined with the litigation in California. In that “multi-district litigation,” state attorneys general are fighting local governments and school districts that are trying to recoup an unspecified amount of damages from McKinsey. The attorneys general are trying to protect last year’s settlement.

McKinsey is seeking to have the multi-district litigation dismissed, arguing that the company “chose to be part of the solution to a complex health crisis” by entering into consent judgments with states.

“As a matter of law, sound public policy and efficient judicial administration, plaintiffs’ claims — as well as any future claim by any political subdivision, school district or municipal body of any kind — should be dismissed in their entirety because they have already been resolved,” the company’s lawyers wrote in a Dec. 23 motion.

But Hogan said the prelitigation settlement with the states doesn’t foreclose the opportunity for schools, towns and counties to pursue recovery for costs now being borne by local residents.

School district lawsuits maintain that, “for the last decade at least, public schools’ ability to succeed has been taxed by the devastation of the opioid epidemic” and point a finger at McKinsey.

“The connection between McKinsey’s role as the architect of a scheme to ‘turbocharge’ opioid sales and substantial harms to public schools is direct and proximate. As a result of McKinsey’s actions, the market was flooded with opioids,” the Florida lawsuit says.

The lawsuit, in part, focuses on children who were born with Neonatal Opioid Withdrawal Syndrome, or NOWS, which can cause cognitive or developmental delays and behavioral and learning problems. Those children “disproportionately need and receive mandated costly ‘special education’ services,” often from pre-kindergarten through high school, according to the lawsuit. Costs for students requiring special education services are almost double that for other children, the lawsuit said.

“By ‘turbocharging’ opioid sales, McKinsey increased NOWS births, saddling many public schools with large, increased, unfunded costs,” attorneys wrote in the federal lawsuit filed in the Middle District of Florida.

According to the complaint, “limited hospitalization data” showed that the number of babies with NOWS born in Florida hospitals tripled from 2008 to 2017.

Because of federal privacy laws, schools are not privy to the reasons that children need special services, making it more difficult to directly tie McKinsey to increased educational costs resulting from opioids’ crippling impact on students and their families.

But in an interview with the News Service, Zahir Rawji, project manager for the Putnam County Opioid Response Team for SMA Healthcare, described some of what children in the North Florida area routinely face as they grow up.

Kids are “actually seeing their parents overdosing,” Rawji said. They come across drug paraphernalia such as syringes on the streets in their neighborhood and are having “first-hand experiences with substances” at very young ages, he added.

“I go visit people who have overdosed. When I walk into their yards, I see toys in their yard. They have 2-, 3-year-old kids running around and they just overdosed. It amazes me sometimes, and then there’s nothing I can do about that. If DCF [the Department of Children and Families'] hasn’t already taken the kids, I can’t do anything about that. But I see that,” Rawji said.

The districts maintain that schools are best suited to help offset the negative effects of opioid addiction and enable kids to thrive as adults.

Hogan pointed to a fund that is part of the bankruptcy plan of Purdue Pharma as a model for future settlements. The company’s $4.5 bankruptcy settlement included a special fund for education that would allow districts and other entities to apply for grants. A federal judge last month rejected the bankruptcy plan, leaving the future of the fund in doubt.

Dara Kam reports for the News Service of Florida.

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