Former pharmaceutical company CEO John Kapoor was convicted of racketeering by a jury in Boston last week in a scheme to bribe doctors to prescribe opioids. Four other executives of Insys, the drug firm founded by Kapoor, were also found guilty in the case after a 10-week trial and 15 days of jury deliberations.
“Today’s convictions mark the first successful prosecution of top pharmaceutical executives for crimes related to the illicit marketing and prescribing of opioids,” said U.S. Attorney Andrew E. Lelling in a statement. “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.”
“This is a landmark prosecution that vindicated the public’s interest in staunching the flow of opioids into our homes and streets,” he added.
Company Pushed Powerful Opioid
During the trial, prosecutors presented evidence that Kapoor and his co-defendants had engaged in a marketing plan that included phony speaking fees and parties at strip clubs and expensive restaurants to entice doctors to prescribe the Insys medication Subsys. The drug is an oral spray containing fentanyl, a powerful opioid that is nearly 100 times stronger than morphine.
Subsys was approved by the FDA to relieve the pain of terminal cancer patients. But Insys executives and sales representatives encouraged doctors to prescribe the drug for patients living with chronic pain, a far larger pool of potential customers. Employees of the company even posed as doctors, submitting bogus diagnoses to insurance companies to pay for Subsys, which can cost as much as $20,000 per month.
Kickbacks Paid to Doctors
Prosecutors called 39 witnesses to testify in the trial, including Gavin Awerbuch, a Michigan doctor who has been sentenced to more than two years in prison for prescribing Subsys to patients who didn’t need it. Awerbuch told the jury that he had made more than $130,000 over 18 months for educational speaking engagements that were often attended by friends and neighbors when other doctors wouldn’t come.
“They were a farce really,’’ said Awerbuch. “It was just easy money for me. I got paid $1,600 to show up, have a nice meal and go home.’’
Another doctor was rewarded with $36,000 in speaking fees and a trip to Arizona that included two $500 sessions in a strip club’s “champagne room.”
Brad Bailey, a Boston criminal defense attorney who followed the trial, told NPR that the severity of the nation’s ongoing opioid crisis led federal prosecutors to the uncommon step of charging corporate executives.
“That’s always unusual. That’s always an attention grabber,” said Bailey. “The big issue is the use of racketeering charges, which had been originally designed to go after the Mafia.”
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