This Is A Really Big Deal, No Matter How You Look At It!

 This appeared a few days ago:

China narrows gap on US in AI arms race as Australia stands idle

Paul Smith Technology editor

Jan 24, 2025 – 5.30pm

As the world waited for Donald Trump to unleash a trade war on China after his inauguration, it was a $US500 billion ($792 billion) artificial intelligence scheme called Stargate that demonstrated where the digital battleground will be contested.

The AI war is being fought on two fronts: infrastructure capacity and the level of sophistication of the AI models built. The US has been leading in both, but the symbolic importance given to Stargate by its presidential announcement comes as China is catching up fast.

Australia, meanwhile, occupies the sidelines wondering where it will fit into the AI world order.

Stargate tackles the infrastructure side of the AI war by pledging to build huge data centres at a rapid clip to house the servers, Nvidia chips and other tech smarts needed to develop technology that is smarter than humans.

China is also spending billions on infrastructure, and reports suggest that its AI models are rapidly catching, and even surpassing, some of those built by OpenAI, Anthropic and Google.

Despite Mr Trump’s presence at the announcement, Stargate is an entirely commercial endeavour, largely boosting the efforts of ChatGPT maker OpenAI. It is funded by OpenAI and Oracle, Japan’s SoftBank and Abu Dhabi-based technology investment firm MGX.

US media has calculated that the $US500 billion investment would cost more than NASA’s Apollo program in the 1960s when factoring in inflation.

Microsoft (a big backer of OpenAI) has also launched its own $US30 billion AI infrastructure fund, alongside fund manager BlackRock, and plans to spend $US80 billion this year on data centres alone.

This sits alongside big investments from other companies such as Amazon Web Services and Elon Musk’s xAI. Earlier this month, Macquarie Asset Management looked to repeat its successful investment in Australian data centre builder AirTrunk with up to $8 billion backing the plans of Nasdaq-listed company Applied Digital.

‘It’s the opposite of the Cold War’

China had to think fast. Restrictions on the sale of AI chips from the likes of Nvidia to China are a hurdle it must overcome, but official data reported by the South China Morning Post on Thursday showed about 250 advanced data centres and other computing facilities were being completed or under construction in mainland China as of June last year.

“The battle over AI is critical, as it determines the future for the economy, and for defence. The US and China are putting billions in because they each identified a decade ago that their sovereignty depends on having world-leading AI,” the chief scientist at the University of Adelaide’s Australian Institute for Machine Learning, Anton van den Hengel, said.

“It’s the opposite of the Cold War, where neither side could use their nuclear arsenals without incurring a high risk of being annihilated. This time the commercial application technology is out in the open.”

US-China tech tensions were high before Mr Trump’s election, and a move in December by the US to tighten restrictions on chips and semiconductor equipment, coupled with the addition of 140 Chinese tech firms to its restricted entity list, marked a significant escalation.

China responded by launching an antitrust probe into Nvidia, while Chinese industrial associations issued warnings about the reliability of US chip supplies. It also banned exports of critical minerals to the US and sanctioned 13 US defence companies.

Professor Van den Hengel said he was frustrated that Australia was not making moves to ramp up AI capability in the form of infrastructure and local large language models to serve as an alternative to those from US giants such as OpenAI, Anthropic and Meta.

“The challenge for Australia is that we are a decade behind the US and China, and we still haven’t started building our own sovereign capability,” he said.

“We face cyber threats right now, and the US is never going to give us their best technology as it would undermine their own defences. You don’t buy AI, you rent it. Microsoft isn’t offering to sell OpenAI to us, they’re offering to give us access. We can’t operate a sovereign economy when a critical part of the infrastructure is owned by a multinational from a foreign country.”

My expectation is that we’ll end up with two AI worlds like we ended up with two internets either side of the ‘Great Firewall of China’.

— Toby Walsh, UNSW AI Institute

The results of all this investment in terms of building the best AI capabilities are still unclear. The US was out of the blocks fastest, but concerns have emerged that the rate of improvement in the AI models underpinning services such as ChatGPT is slowing.

China has its own tech titans to rival the US, in the form of Alibaba, Baidu, Tencent and emerging AI names such as DeepSeek and Zhipu AI, which perform strongly against American bots in some of the tests used to gauge efficacy.

This week, a Chinese-built AI “reasoning” large language model called DeepSeek-R1 had AI analysts talking when it demonstrated it could be a credible rival to OpenAI’s latest o1 model. It thinks through problems step by step, and takes its time to come up with solutions to complex problems.

Unlike OpenAI, it is open source, meaning it is freely available for academic and commercial use, and could potentially become an influential model outside China. That being so, the AI cold war would invariably limit its use in Western business and research.

“DeepSeek is the most impressive, but some of the largest AI models today are Chinese,” said Toby Walsh, the chief scientist at UNSW’s AI Institute.

“My expectation is that we’ll end up with two AI worlds like we ended up with two internets either side of the ‘Great Firewall of China’.

“There will be the US AI world, and there will be the Chinese one. In one, you’ll not be able to prompt about Tiananmen Square, but it will be seamlessly integrated into your WeChat. In the other, it will be one of the US tech giants that owns your data.”

Here is the link:

https://www.afr.com/technology/china-narrows-gap-on-us-in-ai-arms-race-as-australia-stands-idle-20250123-p5l6lx

One really does get the feeling that it is in this domain that WWIII will be played out!

Sadly I fear Australia will wind up being a non-playing spectator – and as time passes, without some real effort we will slip endlessly behind. Right now there is little evidence I can see that our politicians are in any way on top of this field….

$700 Billion is a huge sum and shows just how serious this is IMVHO! It is staggering that Meta alone is planning to spend $100B on the effort!

It will be exciting to watch and I hope OZ can find some useful ways to be involved and learn!

David.

I Really Wonder What Has Gone Wrong To Burden Us With Trump As US President Again?

I can only conclude we must all have been very naughty indeed!

Greenland

Trump again demands to buy Greenland in ‘horrendous’ call with Danish PM

Source says: ‘The Danes are in crisis mode’ after US president’s call with prime minister Mette Frederiksen

Maya Yang

Sun 26 Jan 2025 05.19 AEDT

Donald Trump had a fiery phone call with Danish prime minister Mette Frederiksen over his demands to buy Greenland, according to senior European officials.

Speaking to the Financial Times, officials said that Trump, then still president-elect, spoke with Frederiksen for 45 minutes last week, during which he was described to be aggressive and confrontational about Frederiksen’s refusal to sell Greenland to the US.

The Financial Times reports that according to five current and former senior European officials who were briefed on the call, the conversation “was horrendous”. One person said: “He was very firm. It was a cold shower. Before, it was hard to take it seriously. But I do think it is serious and potentially very dangerous.”

Another person who was briefed on the call told the outlet: “The intent was very clear. They want it. The Danes are now in crisis mode.” Someone else said: “The Danes are utterly freaked out by this.”

According to one former Danish official, the call was a “very tough conversation” in which Trump “threatened specific measures against Denmark such as targeted tariffs”.

Trump has previously said that the US needs to control Greenland and has refused to rule out using US military force to take over the territory. During a press conference a few weeks ago, Trump said that the US needed Greenland “for economic security”. The 836,300-sq-mile (2,166,007-sq-km) Arctic island is rich in oil and gas, as well as various raw materials for green technology.

Speaking to TV 2 earlier this month, Frederiksen said that the autonomous territory is “not for sale”, adding: “Seen through the eyes of the Danish government, Greenland belongs to the Greenlanders.”

In 1953, Greenland became part of the kingdom of Denmark, and in 1979, home rule was introduced. Despite Denmark controlling Greenland’s foreign and security policy, Greenland has its own parliament.

During his new year speech, Múte Egede, Greenland’s prime minister, said that he wanted Greenland to break free from “the shackles of colonialism”. Then, following a visit from Donald Trump Jr earlier this year, Egede said: “We are Greenlanders. We don’t want to be Americans. We don’t want to be Danish either. Greenland’s future will be decided by Greenland.”

Here is the link:

https://www.theguardian.com/world/2025/jan/25/trump-greenland-denmark

Given he (Trump) is 78, or so, years old and apparently eats a very poor diet (hamburgers and Coke?) is it too much to hope that his reign will not be unduly prolonged? I really think a graceful retirement would be good for the world, but what would I know?

You really do have to wonder, however, about this obsession with Greenland for Heaven’s sake! Has he slipped a cog or two?

From what I read his chosen successor (the present VP) is hardly a model of sensible humanity so maybe the devil we know?

I guess we will have to wait to see how it all turns out, but if the apparent plans of his new US Health Secretary are anything to go by, we are in deep dodo (He thinks vaccines are a hoax etc.)! God help us all if there is a global health emergency of some sort with him leading the effort!

David.

AusHealthIT Poll Number 778 – Results – 26 January 2025.

Welcome back! Here are the results of the poll.

Is Peter Dutton Right To Be Encouraging National Debate On Adoption And Use Of Nuclear Energy For Power Generation In Australia?

Yes                                                                         38 (68%)

No                                                                          18 (32%)

I Have No Idea                                                         0 (0%)

Total No. Of Votes: 56

An interesting outcome with a large majority keen on discussion of a nuclear future!

Any insights on the poll are welcome, as a comment, as usual!

Good voting turnout for the long break. 

0 of 56 who answered the poll admitted to not being sure about the answer to the question!

Again, many, many special thanks to all those who voted! 

David.

Well, That's A Wrap For 2024!

All,

I have little left to say this year other than to wish all to have bothered to read here a very happy festive season and a safe and healthy 2025!

I am looking forward to a rest for a few weeks and. at this stage, plan to start blogging again in late January, 2025 when people are back from the holidays!

See you then and warmest best wishes to you all for 2025!

David.

It is Clear To Me The West Failed In Tolerating Such An Evil Ruler For Even A Micro-Second!

This is just a sickening saga

Syria hails global hero executed as Assad fled

Crowds in Damascus have celebrated the legacy of Mazen al-Hamada, the face of the country’s uprising, whose tortured body was found this week.

Adrian Blomfield

Dec 13, 2024 – 10.40am

Few could bear to look long at his face, with its sunken, sorrowful eyes so full of pain – but when Mazen al-Hamada spoke, you could not help but listen.

He spoke to audiences across the West, in lecture theatres and parliaments, bearing witness to the darkness of the Assad regime in low, urgent tones.

Sometimes, he showed them his wrists, scarred by the chains from which he hung until he lost consciousness. He would speak of the beatings and the rapes he and others suffered, his haunted eyes reddening at the memory.

On Thursday (Friday AEDT), they laid Hamada to rest in central Damascus, the capital coming to a halt as its residents gathered to honour the man who became the embodiment of a nation’s suffering and who now had become as powerful a symbol in death as he was in life.

Hamada was one of the last casualties of the 13-year uprising against Bashar al-Assad, tortured to death by a vindictive regime in its death throes just hours before the advancing rebels flung open the doors of the infamous Sednaya prison where he was held.

Having escaped for Europe in 2014 after his first incarceration, Hamada returned home six years later, fearing his crusade was having little impact, worried about his family’s wellbeing and relieved to have received assurances he would not be detained again.

Instead, he was arrested at Damascus airport immediately after his plane landed and never seen again until, on Tuesday, just two days after Assad’s fall, the city’s new masters discovered his body among 35 corpses wrapped in bloodied sheets at a military hospital in the Harasta district.

Tens of thousands were tortured to death by the Assad regime over the course of the rebellion. Hamada was quite possibly the last of them, killed, so activists hypothesise, to prevent him testifying against Sednaya’s torturers.

Muhammad Jafran’s forensic medical team at Damascus hospital examined all 35 bodies and concluded that only two, Hamada’s and another, had external injuries. The others, all believed to have been inmates at Sednaya, died either of starvation or asphyxia, most likely after suffocating in its overcrowded cells.

But what shocked Jafran was the scale of the injuries to Hamada’s body and that they had clearly been inflicted over several days. It is probable, the doctors concluded, that he died on Friday, less than 48 hours before Assad fled the country.

“He had so many fractures,” Jafran said. “There were injuries to his entire body, with heavy bruising on the femurs and abdomen. We don’t know which was the injury that killed him. We do know he suffered.”

From the morgue at the hospital, through the streets of Damascus to the Hejaz railway station, the crowd carried his coffin, chanting his name, lauding his courage and regretting how poignantly close he had come to rescue.

Yet it was not just Hamada’s picture the crowds held aloft. There were dozens of others, too, each showing the image of another of Assad’s victims who disappeared over his 24-year rule never to be seen again, buried, most likely, in unknown, unmarked graves across Syria.

Fittingly, the man who in life championed the cause of all Syria’s 100,000 or more political prisoners had become the symbol of far more deaths than just his own.

Nor was it just those with missing relatives who joined the procession. So, too, did political prisoners of all generations who had also survived torture, not just under the regime of Bashar al-Assad, but under that of his equally dictatorial father Hafez, who seized power in a coup in 1971 and ruled until his death in 2000.

They came not just to pay tribute to the man who gave voice to Syria’s suffering but to celebrate the fact that, for the first time in so long, there is a genuine atmosphere of freedom in the country.

“One of the biggest changes is that we don’t need to be frightened of each other any more,” said Abdullah Fadel, who was held at Sednaya for nine years in the 1990s and for a further three months in 2016.

“I can put my arm around someone I don’t know on the street and tell them what I really think, knowing that no one is going to do anything to me. I never imagined I would live to see such a thing happening in Syria.”

Arrested for belonging to the Communist Party, Fadel endured repeated torture during the early period of his first spell in custody.

He survived prison, he says, by teaching himself English then translating George Orwell’s Coming Up for Air into Arabic, setting him up for a lifelong career as a translator of novels.

It is experiences such as these, inflicted on so many, that helped stir up such hatred in the Assad regime, and reasons people flocked to join Hayat Tahrir al-Sham (HTS), the Islamist movement that toppled it.

Among those at Hamada’s funeral, there was optimism that HTS would be better than the Assad regime – “it could hardly be worse”, said Fadel’s wife, although that was tempered by others by the fear that it might be.

“We have only walked half way,” said Mahmoud Isa, a 61-year-old former political prisoner. “The other half is to come and it will not be easy because we now need to move beyond the men with guns. Syria wants democracy. If we get dictatorship again, we will rise up again.”

Isa is not the only person expressing reservations.

Across the capital, in the city’s ancient Christian quarter, three 19-year-old women – Jessica, Miriam and Giselle – were in a reflective mood as they sipped coffee in a cafe off Straight Street.

As a minority, they hesitantly admitted, they regarded Assad, a member of another minority, the Alawites, as a protector from extremist Sunni Arab groups, HTS among them.

Yet it was only now that state television, which long parroted the government line, had fallen that they had become aware of the atrocities the Assad regime had perpetrated, they said.

“We lived in the dark,” said Miriam, who did not want to give her surname.

Just as they had underestimated the abuses of the Assad regime, so far, they said, they had exaggerated the dangers of HTS, which once pledged allegiance to al-Qaeda but now insists it is pursuing moderation and tolerance.

Although bars in the Christian quarter remain closed, just in case, she knew of no retribution against Christians, Jessica said, despite their reputation as Assad supporters. That said, she added, these are early days and things could change.

“We are waiting,” she said. “It will take time to build confidence. We are hoping that we will live in a Syria where everyone is genuinely free and everyone can follow their own religion.”

The Telegraph London

Here is the link:

https://www.afr.com/world/middle-east/syria-hails-global-hero-executed-as-assad-fled-20241213-p5ky5o

The more you read about the Assad regime the more one wonders just why he was allowed to rape Syria and Syrians for so long! The US, US, Europe and indeed OZ knew how evil he was but just stood by and watched for 13 long years!

Surely the CIA or MI6 could have found an assassin to sort this horror out. You have to wonder why not?

The West seems rather too prone to high ideals and the toleration of evil I fear.

What do you think?  Should our beliefs be followed up by action?  There have been all sorts from Idi Amin down who should have been dealt with more swiftly IMVHO but who am I to judge?

Worse still he was a doctor!!!!!

David.

It Would Be Nice To See These Ideas Actually Lead To Real Action And Outcomes!

I reckon I have been reading the same things for the last 15+ years

This latest appeared a few days ago:

Why data access holds the key to better care

By Amy Sarcevic
Friday, 13 December, 2024

---

An AI-enabled healthcare sector is a potentially idyllic place, where healthy habits are supported, early disease is detected, and, ultimately, deaths are prevented.

But while 85% of healthcare leaders have an AI strategy, much of this multibillion-dollar industry remains untapped, with clinical AI virtually non-existent in Australian hospitals.

Of those who are dabbling in other AI uses, penetration is limited, with only half of healthcare providers currently using the technology in other forms.

This contrasts with sectors like financial services, where global AI spend is projected to reach $97 billion by 2027.

So what is impeding the healthcare industry’s uptake of this readily available technology?

Access to data

The quality of AI decision-making from large language models largely rests on the quality of data used to train it — a realisation that has helped earn data kudos as the ‘new oil’.

Analysing data from electronic health records, an award-winning AI tool by Telstra Health, RMIT and the Digital Health CRC, for example, can detect early signs of deterioration in frail aged care residents.

“It monitors structured and free-text EHRs for 36 evidence-based signs of deterioration. In turn, it provides staff with a frailty index for each resident, and alerts them to falls, depression and mortality risk,” said Annette Schmiede, CEO of Digital CRC, the organisation that facilitated the research initiative.

However, as Schmiede points out, accessing healthcare data continues to be challenging, with organisations still facing delays when requesting it.

“We are still experiencing significant delays in access to data, despite it being constantly identified as an important element in driving innovation,” she told Hospital + Healthcare.

“An example of this is a project we recently ran, which can only commence after two years of waiting for the data to be made available by the state authority.

“We have excellent relationships with the data custodians, we’re well respected, but the whole process is still taking too much time — and that needs some urgent attention.”

While Schmiede is encouraged by the government’s work with health information exchanges — in which health data is being uploaded onto common platforms — she says more work is needed to improve access in the interim.

“There’s widespread acknowledgement of the issue, but we’re still not seeing that being translated into faster access.”

Interoperability

The seamless exchange of data between disparate parts of the healthcare system is also important for end-users — and an ongoing source of frustration for those using new technologies to track health metrics.

“It’s great if you have an AI-powered health app that monitors your vitals over time. But if that information is not automatically added to your health records, then you need to repeatedly explain it to your GP, then to a specialist, and to an allied health professional.

“It affects the user experience for staff and patients, and opens the door for errors and omissions, which takes away a lot of the benefit,” Schmiede said.

According to Dr Stephanie Allen from Kearney, part of the interoperability puzzle is ensuring that the data and insights collected by personal health devices or apps, are “clinical grade”, and don’t produce false positives.

“False positives can create unnecessary anxiety for users but also swamp the already stretched primary health system, with the expectation to ‘test’ again before a formal diagnosis is given,” she said.

In addition, data from different apps and devices should be brought together to paint a full picture of a person’s health.

“We know that our health is interconnected with many aspects of our lifestyle. For example, the relationship between mental wellbeing, nutrition and sleep is only beginning to be understood.

“Combining this data to form a more holistic picture of an individual’s health is fundamental to making the right behavioural adaptations, to protect and/or enhance our overall wellbeing.

“If we have variable levels of quality and reliability of data capture this becomes an impossibility,” Allen said.

Upskilling the workforce

Even a well-oiled healthcare system, with seamless connectivity, will not support the use and uptake of AI if end-users cannot easily navigate it.

For this reason, Digital CRC is taking steps to improve digital literacy and upskill the healthcare workforce, through its Education and Capacity building and Emerging Leaders programs.

“These were set up with the aim of producing the next generation of digital health professionals. Through this program, they will learn first-hand how to use digital health and data analytics to improve patient outcomes and clinician experiences,” Schmiede said.

“We are empowering this group to revolutionise health care and become change agents.”

Optimistic outlook

With projects like these, Schmiede is confident that Australia’s AI future is bright and that more people will feel empowered to use the technology.

“By introducing it responsibly, we can gradually build industry confidence. And as AI becomes more widespread, we’ll be forced to address issues like data access and interoperability head-on,” she concluded.

Here is the link:

https://www.hospitalhealth.com.au/content/technology/article/ai-an-untapped-opportunity-data-access-holds-the-key-1698602172

It is getting to the stage where I am not hopeful of seeing much change in my lifetime! Maybe in the next?

Does anyone have some concrete evidence that the Digital Health CRC is actually making a difference or is the whole thing a total waste of money?

Views and comments welcome!

David.

This Certainly Sounds Like A Risk We Should Avoid, By Not Taking The Risk In The First Place!

This appeared last week:

‘Unprecedented risk’ to life on Earth: Scientists call for halt on ‘mirror life’ microbe research

Experts warn that mirror bacteria, constructed from mirror images of molecules found in nature, could put humans, animals and plants at risk of lethal infections

Ian Sample Science editor

Fri 13 Dec 2024 06.00 AEDT

World-leading scientists have called for a halt on research to create “mirror life” microbes amid concerns that the synthetic organisms would present an “unprecedented risk” to life on Earth.

The international group of Nobel laureates and other experts warn that mirror bacteria, constructed from mirror images of molecules found in nature, could become established in the environment and slip past the immune defences of natural organisms, putting humans, animals and plants at risk of lethal infections.

Although a viable mirror microbe would probably take at least a decade to build, a new risk assessment raised such serious concerns about the organisms that the 38-strong group urged scientists to stop work towards the goal and asked funders to make clear they will no longer support the research.

“The threat we’re talking about is unprecedented,” said Prof Vaughn Cooper, an evolutionary biologist at the University of Pittsburgh. “Mirror bacteria would likely evade many human, animal and plant immune system responses and in each case would cause lethal infections that would spread without check.”

The expert group includes Dr Craig Venter, the US scientist who led the private effort to sequence the human genome in the 1990s, and the Nobel laureates Prof Greg Winter at the University of Cambridge and Prof Jack Szostak at the University of Chicago.

Many molecules for life can exist in two distinct forms, each the mirror image of the other. The DNA of all living organisms is made from “right-handed” nucleotides, while proteins, the building blocks of cells, are made from “left-handed” amino acids. Why nature works this way is unclear: life could have chosen left-handed DNA and right-handed proteins instead.

Scientists have already manufactured large, functional mirror molecules to study them more closely. Some have even taken baby steps towards building mirror microbes, though constructing a whole organism from mirror molecules is beyond today’s know-how.

The work is driven by fascination and potential applications. Mirror molecules could be turned into therapies for chronic and hard-to-treat diseases, while mirror microbes could make bioproduction facilities, which use bugs to churn out chemicals, more resistant to contamination.

The fresh concerns over the technology are revealed in a 299-page report and a commentary in the journal Science. While enthusiastic about research on mirror molecules, the report sees substantial risks in mirror microbes and calls for a global debate on the work.

Beyond causing lethal infections, the researchers doubt the microbes could be safely contained or kept in check by natural competitors and predators. Existing antibiotics are unlikely to be effective, either.

“Unless compelling evidence emerges that mirror life would not pose extraordinary dangers, we believe that mirror bacteria and other mirror organisms, even those with engineered biocontainment measures, should not be created,” the authors write in Science.

“We therefore recommend that research with the goal of creating mirror bacteria not be permitted, and that funders make clear that they will not support such work.”

Dr Kate Adamala, a synthetic biologist at the University of Minnesota and co-author on the report, was working towards a mirror cell but changed tack last year after studying the risks in detail.

“We should not be making mirror life,” she said. “We have time for the conversation. And that’s what we were trying to do with this paper, to start a global conversation.”

Prof Paul Freemont at Imperial College London, who was not involved in the report, called it an “excellent example of responsible research and innovation”.

“Whilst the authors clearly point out the need for an open and transparent debate on the development of mirrored living organisms, there is also a need to identify the promise and positive uses of mirror chemistry in biological systems, albeit in a limited and perhaps future regulated manner,” he said.

Here is the link:

https://www.theguardian.com/science/2024/dec/12/unprecedented-risk-to-life-on-earth-scientists-call-for-halt-on-mirror-life-microbe-research

I reckon the authors have something here as bugs created like this would be totally novel to our immune system and this just go ahead and damage us totally unconstrained!

I don’t think we should be even experimenting with these nasties!!!!! I agree with the headline!

David.

Ethics Free Cleverness Is A Very Bad Combination As This Saga Reveals!

The conclusion of a rancid story of greed and evil human exploitation emerged recently.

‘Powerful message to consulting’: McKinsey to pay $1b for opioid crisis

David Ovalle

Dec 15, 2024 – 7.57am

Washington | Business consulting giant McKinsey will pay $US650 million ($1 billion) to end a criminal probe by the Justice Department into the company’s role in bolstering sales of addictive pain pills, prosecutors announced on the weekend.

In what officials described as a landmark case, US attorneys in Massachusetts and Virginia filed charges of conspiracy to misbrand a drug and obstruction.

The investigation stems from the company’s work advising Purdue Pharma on how to “turbocharge” sales of the blockbuster opioid OxyContin, officials said. State and federal officials allege Purdue helped kick-start the nation’s opioid crisis in the late 1990s and 2000s by aggressively marketing the drug to doctors while downplaying its addiction risk.

It marks the first time a management consulting company has faced criminal charges related to work with the opioid industry, said Christopher R. Kavanaugh, US attorney for the Western District of Virginia.

“It sends a powerful message to the consulting industry,” Mr Kavanaugh said at a news conference in Boston on Friday (Saturday AEDT).

McKinsey’s agreement also resolves a Justice Department civil investigation into allegations the company’s work with Purdue led to false claims to federal health insurance programs.

The agreement adds to more than $US989 million that McKinsey agreed earlier to pay to settle lawsuits from states, local governments, school districts, health insurers and benefit plans. It is another black eye for the consulting giant. This month, a McKinsey subsidiary agreed to pay more than $US122 million to resolve a federal probe into allegations it sought to bribe government officials in South Africa.

McKinsey said in a statement that it should never have worked with Purdue. “This terrible public health crisis and our past work for opioid manufacturers will always be a source of profound regret for our firm,” the company said.

Martin Elling, a former McKinsey senior partner, has also agreed to plead guilty to allegations he destroyed records related to the company’s consulting with Purdue, federal court records show. His attorney did not immediately respond to a request for comment.

McKinsey began working with Purdue in 2004, continuing even after an affiliate of the Connecticut drugmaker and several executives pleaded guilty to misbranding OxyContin in 2007.

According to a court filing on Friday, the company helped try to fend off proposed Food and Drug Administration restrictions designed to minimise the risk of the opioid. Amid slumping sales, McKinsey advised Purdue on how to target doctors who then wrote medically unnecessary prescriptions, prosecutors said.

McKinsey consultants even rode along with Purdue sales representatives to visit doctors, officials said.

“They were no better than street level dealers reaping a profit from addiction and misery of others,” said Boston FBI Special Agent in Charge Jodi Cohen.

McKinsey has stopped working with opioid industry companies. If the company successfully completes five years of federal oversight, prosecutors will drop the charges, according to the agreement.

Purdue, facing a tsunami of lawsuits, filed for bankruptcy in 2019. In June, the Supreme Court scuttled a bankruptcy plan that would have settled lawsuits with governments and victims. The company estimated the settlement could be worth up to $US10 billion.

Purdue, the family that owns the company and creditors are engaged in court-ordered mediation scheduled to conclude on December 23; Purdue is asking for an extension through late January. In a statement on Friday, the company said it was working toward a settlement that would compensate victims and curb the opioid crisis.

The McKinsey agreement marks another moment of reckoning for companies involved in the opioid crisis, which started with prescription pills that often ended up on the illicit market, fuelling addiction.

As prescriptions for opioids declined in recent years, the epidemic of addiction shifted to illicit fentanyl, which has proved even deadlier. Drug overdoses killed more than 100,000 people in the United States in each of the past three years, although officials have noted a sharp decrease in 2024.

Local and state governments have filed thousands of lawsuits against companies involved with prescription opioids, arguing that the flood of potent pain pills wreaked havoc on communities.

The legal strategy of using state public nuisance laws has resulted in more than $US50 billion in settlements with drug makers, distributors, pharmacy chains and others. In cases that have gone to trial, some cities and counties have won large judgments.

But others have lost. The latest example happened on Tuesday, when the Oklahoma Supreme Court sided with retail chains that had been ordered to pay $US650 million to help communities suffering from the crisis.

Washington Post

Here is the link:

https://www.afr.com/world/north-america/no-better-than-street-dealers-mckinsey-to-pay-1b-for-opioid-crisis-20241215-p5kyfo

There are some really excellent documentaries on all this. Here is a link to a good one:

https://www.netflix.com/title/81095069

The combination of greed, exploitation and raw evil in pushing Oxycontin was really something to behold!

That 100,000 people died of overdoses is just too horrific to contemplate – but shows just how evil people driven by financial greed can be!

Great to see the piper is being paid and the crooks are being bankrupted! Sends a message to those over-smart consultants!

There is a lesson here I believe…

David.