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Insys founder John Kapoor convicted in fentanyl bribery case

By Allen Cone
Insys founder John Kapoor convicted in fentanyl bribery case
John Kapoor, the found of Insys Therapeutics, was convicted Thursday of bribing doctors into prescribing Subsys, a powerful Fentanyl spray intended for cancer patients experiencing breakthrough pain. Photo by Insys Therapeutics

May 2 (UPI) -- Insys Therapeutics Inc. founder John Kapoor was convicted Thursday of racketeering conspiracy involving bribes and kickbacks to physicians who prescribed large amounts of highly addictive fentanyl spray to patients.

In federal court, a jury deliberated for 15 days before finding the Arizona-based company's former chairman guilty, a conviction that carries a maximum 20 years in prison.

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It was the first time a drug company leader was convicted in federal court.

U.S. Attorney Andrew Lelling, the top federal prosecutor in Massachusetts, said in a statement it is "a landmark prosecution that vindicated the public's interest in staunching the flow of opioids into our homes and streets."

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Four other top execs were found guilty in the U.S. District Court for the District of Massachusetts: Richard M. Simon, the company's former national director of sales; Sunrise Lee and Joseph A. Rowan, who were one-time regional sales directors; and Michael J. Gurry, the former vice president of Managed Markets.

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Before the start of the trial, two other high-level Insys executives pleaded guilty and testified during the trial: Michael Babich, the former CEO and president of the company, and Alec Burlakoff, the former vice president of sales.

Kapoor, 76, was arrested on Oct. 26, 2017, the same day that President Donald Trump declared the opioid epidemic a public emergency.

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Between 2012 and 2015, federal prosecutors alleged that doctors prescribed patients large numbers of Subsys, a fentanyl-based pain medication in exchange for kickbacks and bribes from the Insys executives.

Fentanyl is considered 50 times stronger than heroin and up to 100 times more potent than morphine.

The drug is intended for cancer patients experiencing breakthrough pain but some patients prescribed didn't have the disease.

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Some doctors were earlier convicted of crimes in states where they practiced and testified against the Insys executives during trial.

The bribes varied for each of the 10 practitioners in the complaint, but exceeded $100,000 or even $200,000 for some of them.

The company leaders also allegedly defrauded health insurance companies.

In March 2012, Insys began using "speaker programs" purportedly intended to increase brand awareness of Subsys through peer-to-peer educational lunches and dinners. The programs were used to pay bribes and kickbacks to targeted practitioners in exchange for increased Subsys prescriptions and increased dosage. The programs were shams in most instances.

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"Today's convictions mark the first successful prosecution of top pharmaceutical executives for crimes related to the illicit marketing and prescribing of opioids," Lelling said. "Just as we would street-level drug dealers, we will hold pharmaceutical executives responsible for fueling the opioid epidemic by recklessly and illegally distributing these drugs, especially while conspiring to commit racketeering along the way."

Kapoor declined to comment.

In a statement, his attorney, Beth Wilkinson, said that her client is "disappointed in the verdict, as we are" and that the weeks of deliberations "confirm that this was far from an open-and-shut case." And "We will continue the fight to clear Dr. Kapoor's name."

The company said in a statement: "The actions of a select few former employees of the company are not indicative of the hard work conducted by our talented team today who have dedicated themselves to improving the lives of patients and formulating life-saving molecules across several indications."

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