Manufacturer of synthetic opioid agrees to pay $225 million to settle investigations

Company accused of illegally marketing Subsys

By Rob Frehse, CNN
Copyright 2019 CNN

A patient holds the opioid called Subsys that her doctor prescribed to treat Crohn's disease.

(CNN) - Opioid manufacturer Insys Therapeutics agreed to pay $225 million to settle federal civil and criminal investigations after illegally marketing the drug to doctors and nurses, federal officials said Wednesday.

Insys Therapeutics is the maker of Subsys, a version of the extremely powerful synthetic opioid fentanyl.

In the agreement, a subsidiary of Insys will plead guilty to five counts of mail fraud and pay a $2 million fine and $28 million in forfeiture, the US Attorney's office in Massachusetts said.

"Today's settlement underscores our determination to hold opioid manufacturers accountable for pushing these highly addictive narcotics on the public via kickbacks to doctors and nurses, and other illegal means," said Nick Hanna, a United States Attorney for the Central District of California.

"Our goal is to bring about an end to the tragic epidemic of opioid addiction and to go after those who profit from that epidemic."

Five top executives from the company were found guilty last month on federal racketeering charges for bribing doctors to prescribe the painkiller to people who didn't need it. They were also convicted of defrauding Medicare and private insurance.

That trial put on display sales tactics such as lap dances to lure doctors and a company vice president who dressed as a Subsys bottle and rapped during a company promo.

The jury took 15 days to reach its verdict against the executives, including founder and one-time billionaire John Kapoor.

Each faces up to 20 years in prison. All five executives -- Kapoor and former Insys managers Michael Gurry, Sunrise Lee, Joseph Rowan and Richard Simon -- have denied wrongdoing. Their attorneys have vowed to appeal the verdict.

Over many weeks, the trial peeled back the layers of how the opioid maker operated, offering a rare glimpse into the mentality of some pharmaceutical representatives and their sales tactics -- even for one of the most lethal opioids.

Subsys had been approved by the US Food and Drug Administration in 2012 only for cancer patients with recurring chronic pain. Andrew Kolodny, co-director of the Opioid Policy Research Collaborative at Brandeis University, said evidence shown during trial revealed how the company actively sought doctors to prescribe the drug beyond its intended scope.

"For patients who this drug didn't kill," Kolodny said, "many are left with addiction or left with a very difficult time coming off of this product."

According to the US Centers for Disease Control and Prevention, there were more than 28,000 deaths involving synthetic opioids in 2017 alone, more fatal overdoses than with any other type of opioid.

The-CNN-Wire ™ & © 2019 Cable News Network, Inc., a Time Warner Company. All rights reserved.