Former Insys Therapeutics CEO to pay $5M for alleged improper opioid marketing

John Kapoor, the former CEO of Insys Therapeutics, agreed to pay New Jersey $5 million to settle allegations for his role in fueling the opioid epidemic, New Jersey Attorney General Gurbir Grewal announced Jan. 21.

Insys Therapeutics' main product is Subsys, a sublingual liquid form of fentanyl. New Jersey's complaint against Mr. Kapoor says Subsys is 50 times stronger than heroin.

Mr. Kapoor was sentenced to more than five years in federal prison in January 2020 after being convicted of engaging in a racketeering conspiracy to increase sales of Subsys. The Jan. 21 settlement comes as a result of a 2017 complaint filed against him, which alleges Insys Therapeutics violated the New Jersey Consumer Fraud Act and False Claims Act by bribing healthcare professionals to write improper prescriptions for Subsys.

The FDA approved Subsys only for narrow use, but Mr. Kapoor devised a plan to mislead insurance companies and pharmacy benefit managers about patients' diagnoses and treatment histories to produce improper prescriptions, according to the complaint. The complaint also alleges Insys Therapeutics bribed healthcare professionals to write Subsys prescriptions for higher doses than necessary.

Mr. Kapoor will make an initial $1 million lump sum payment to New Jersey, followed by another $4 million. Mr. Grewal said most of this money will go toward the state's efforts to combat the opioid epidemic, but some will be used to reimburse the state for the cost of the lawsuit and compensate the agencies affected by Kapoor's alleged actions.

The settlement also prohibits Mr. Kapoor from owning any business in New Jersey or possessing more than 10 percent stock in any company doing business in the state.

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