clear
Saturday November 25th, 2017 12:29AM

Prosecutors: US conspiracy came amid slow sales of opioid

By The Associated Press
Related Articles
  Contact Editor

PHOENIX (AP) — A new mouth spray that delivered the powerful painkiller fentanyl to end-stage cancer patients wasn't selling as well as anticipated. So drug company executives moved quickly to make its production worthwhile.

U.S. court records in the case against an immigrant billionaire who is one of Arizona's wealthiest men describe the daunting market challenges that Insys Therapeutics founder John N. Kapoor and fellow executives faced after launching the opioid medication Subsys in 2012.

The highly addictive drug was going to cost a cancer patient up to thousands of dollars a month to control intolerable levels of pain. It could only be prescribed by a medical practitioner registered with the Drug Enforcement Administration, and it was among several cancer pain medicines already available.

Five years later, Subsys is at the heart of the case against Insys Therapeutics executives, including Kapoor, 74, of Phoenix, who is charged with leading a nationwide conspiracy to bribe doctors and pharmacists to widely prescribe the potent painkiller to people who didn't need it.

Defense attorney Brian T. Kelly, a high-profile Boston lawyer, has said Kapoor is not guilty.

It comes amid an opioid epidemic that claims thousands of lives each year and led President Donald Trump to declare a nationwide public health emergency.

To make Subsys more profitable, Insys executives turned to aggressive marketing tactics, such as bribes and kickbacks that included "speaker fees and honoraria for marketing events, food and entertainment" for doctors and pharmacists who prescribed the drug, according to an updated federal fraud and racketeering indictment in the ongoing case. The new charges were filed this week in Massachusetts.

In exchange, the practitioners are accused of writing large numbers of prescriptions for patients, most of whom were not diagnosed with cancer. Prosecutors say the scam stretched across the U.S., involving pharmacies and pain management clinics and practitioners from Saginaw, Michigan, to southwest Florida and Laredo, Texas.

Federal prosecutors in Boston first brought the case against six Insys executives and managers, including former CEO Michael L. Babich, who are set to go to trial next year and have pleaded not guilty. The updated indictment unsealed this week brings new charges against them and alleges Kapoor and the others provided kickbacks to doctors and conspired to defraud insurance providers.

The court records describe events that encouraged sales representatives to push practitioners to prescribe ever higher doses of the fentanyl spray. A video at one event purportedly showed company employees dancing, rapping and singing with a life-size bottle of the highest dosage of the spray, suggesting that increased amounts were "not a problem!"

To get paid back by insurance companies that didn't want to fund the drug for non-cancer patients, the company established a "reimbursement center" that used employees to suggest they were calling on behalf of a doctor and the patient in question had cancer — even if that wasn't true, the indictment says.

Kapoor founded Insys Therapeutics in 1990. Its stock price has tumbled amid the legal trouble in recent months, but the company said this week that it is under new management and has assumed responsibility for its former employees' actions.

The drug is question, fentanyl, is useful for managing pain for people with end-stage cancers, said Dr. Karen Sibert, an associate clinical professor with UCLA Health's Department of Anesthesiology and Perioperative Medicine. But opioids are dangerous when used incorrectly and without medical supervision because they can cause a person to stop breathing, she said.

"If you have extreme pain from end-stage cancer, the risk from stopping breathing is an acceptable risk," she said. "But it's not if you are a young person with back pain."

Kapoor emigrated from India decades ago and earned a Ph.D. in medicinal chemistry from the University of Buffalo in New York, where the pharmacy school is named for him and his wife to honor their philanthropy.

In addition to Insys Therapeutics, which went public in 2013, Kapoor founded Illinois-based Akorn Pharmaceuticals. He also has a company that operates seven restaurants.

Forbes said several years ago that Kapoor was worth $2.4 billion. That has fallen amid his company's legal woes, but the magazine still listed Kapoor's worth at $1.75 billion on Friday.

A judge set bail for Kapoor at $1 million and said he must wear electronic monitoring and surrender his passports.

  • Associated Categories: U.S. News, Associated Press (AP), AP National News, Top U.S. News short headlines, AP Health, AP Business, AP Business - Corporate News, AP Business - Small Business
© Copyright 2017 AccessWDUN.com
All rights reserved. This material may not be published, broadcast, rewritten, or redistributed without permission.
Prosecutors: US conspiracy came amid slow sales of opioid
Prosecutors say a drug company facing market challenges with a powerful painkiller embraced aggressive techniques to sell the highly addictive opioid to people who didn't need it
7:16PM ( 9 minutes ago )
The Latest: Pederson at DH for Dodgers World Series Game 3
Joc Pederson will now be the designated hitter for the Los Angeles Dodgers in Game 3 of the World Series, which has shifted to the American League ballpark
7:01PM ( 24 minutes ago )
Botulism pills, the CIA, the Mob and the JFK assassination
Files on John F. Kennedy's assassination are reviving eye-popping details on how intelligence agencies operated and what the government knew about the president's killer
6:48PM ( 37 minutes ago )
Associated Press (AP)
White House: Trump plans to make choice for Fed next week
White House says Trump plans to announce choice for Federal Reserve chair next week
5:42PM ( 1 hour ago )
3 reasons why CVS would want to buy health insurer Aetna
Analysts say a CVS-Aetna combination would create a health colossus that can reach deeper into the average customer's life to manage care and cut costs
5:24PM ( 2 hours ago )
Utah senator: Trump shrinking 2 national monuments in Utah
Utah. Sen. Orrin Hatch says President Donald Trump is shrinking two national monuments in Utah, following a recommendation by Interior Secretary Ryan Zinke
5:21PM ( 2 hours ago )
AP Business
The Latest: Zinke denies any connection to contract
Interior Secretary Ryan Zinke says he "had absolutely nothing to do" with a $300 million contract awarded to a small company from his hometown to help restore Puerto Rico's power grid
4:54PM ( 2 hours ago )
The Latest: Watchdog to review awarding of power contract
An internal watchdog at the Department of Homeland Security says it will review the decision to award a $300 million contract to help restore Puerto Rico's power grid.
4:06PM ( 3 hours ago )
Immigrant billionaire founded embattled drug company
A drug company founder accused of pushing prescriptions of a highly addictive painkiller was once one of Arizona's richest billionaires and also owns a firm that runs restaurants
3:58PM ( 3 hours ago )
AP Business - Corporate News
Weinstein Co. targeted in new claims of sexual misconduct
Lawyers for two women accusing disgraced film mogul Harvey Weinstein of sexual misconduct are targeting his former company
11:23PM ( 1 day ago )
States lose push to force Trump to restart health subsidies
A U.S. judge has rejected a request from 18 states and the District of Columbia to force the Trump administration to resume paying "Obamacare" subsidies right away
9:47PM ( 1 day ago )
Trump opposes massive California water project
The Trump administration pulled support from an ambitious plan to build California's biggest water project in decades, casting the current form of the $16 billion proposal to build two giant tunnels as another unwanted legacy from the Obama era
7:49PM ( 1 day ago )
AP Business - Small Business
The Latest: Pederson at DH for Dodgers World Series Game 3
Joc Pederson will now be the designated hitter for the Los Angeles Dodgers in Game 3 of the World Series, which has shifted to the American League ballpark
7:01PM ( 24 minutes ago )
Botulism pills, the CIA, the Mob and the JFK assassination
Files on John F. Kennedy's assassination are reviving eye-popping details on how intelligence agencies operated and what the government knew about the president's killer
6:48PM ( 37 minutes ago )
Trump frustrated by intelligence community's JFK secrecy
President Donald Trump is upset with the FBI and CIA over their insistence that thousands of files relating to the JFK Assassination remain classified
6:43PM ( 43 minutes ago )
Lawsuit say asylum seekers improperly detained in crackdown
Civil liberties groups have sued on behalf of more than 30 immigrants who were jailed in a Batavia, New York, detention facility and say they were wrongly denied parole while their asylum applications were pending
6:37PM ( 49 minutes ago )
Fleet feet blaze way to fast feats on trails, cliffs, peaks
To some outdoor enthusiasts, it's not about lingering to see the sights, it's about being the fastest runner or climber
6:35PM ( 50 minutes ago )