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Insys Therapeutics CEO and execs indicted for bribing doctors to prescribe fentanyl, fueled opioid epidemic

December 13, 2016  |  Posted by: Francesca Falzarano
Insys Therapeutics CEO and execs indicted for bribing doctors to prescribe fentanyl, fueled opioid epidemic

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On Thursday, a number of former top executives at a pharmaceutical company that markets the potent painkiller fentanyl were indicted on charges including bribing doctors, defrauding insurance companies and were ultimately responsible for fueling America’s opioid epidemic.

Justice Department Prosecutors in Massachusetts announced the indictment of Michael Babich, 40, who is the former CEO of Insys Therapeutics, on a range of felony charges including conspiracy to commit racketeering related to sales of Subsys, a fentanyl spray used in cancer patients who experience severe pain. Six other former Insys execs, including the former national sales director, were also charged in the conspiracy.

Fentanyl is a manufactured opioid that’s approximately 100 times more potent than morphine and 40 times more powerful than heroin. The drug has been criticized for contributing to the huge spike in fatal overdoses across the United States in recent years.

Under Babich and the other top executives, Insys reportedly paid hundreds of thousands of dollars in bribes and kickbacks to doctors who ran pain clinics in exchange for the practitioners prescribing the company’s fentanyl product to patients who did not have cancer, a statement released last week by federal law enforcement revealed.

“The bribes and kickbacks were most frequently disguised as fees the company paid the practitioners for marketing events,” federal prosecutors stated. Various doctors allegedly were paid over $100,000 as part of the plot, and one was even given $275,000.

The corporation, which is based in Arizona, also purportedly “conspired to mislead and defraud health insurance providers who were reluctant to approve payment for the drug when it was prescribed for non-cancer patients.”

“They contributed to the growing opioid epidemic and placed profit before safety,” said special agent in charge of the FBI’s Boston field division, Harold H. Shaw.

In a statement released by Insys, the company stated: “Insys continues to cooperate with all relevant authorities in its ongoing investigations and is committed to complying with laws and regulations that govern our products and business practices.”

The company was previously under state investigations in association with the alleged kickback scheme and were facing a separate round of federal charges in NY. A number of shareholders have also filed class-action lawsuits against the business. One former sales representative has pleaded guilty already to fraud charges.

Insys gained fame after bankrolling the campaign against weed legalization in Arizona during November’s election. The company, which is producing a synthetic marijuana painkiller, donated $500,000 to help defeat a ballot initiative that would have permitted recreational marijuana sales in the state.

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