The founder of Insys Therapeutics has become the first head of a major US pharmaceutical to be convicted of bribing doctors to prescribe addictive painkillers blamed for fuelling an opioid crisis that has claimed tens of thousands of lives.
John Kapoor, 76, was found guilty of criminal conspiracy, along with four other former executives of the Arizona-based firm.
The former billionaire and his co-defendants, including regional sales director Sunrise Lee, a former stripper, face up to 20 years in prison, and will be sentenced at a later date.
They denied wrongdoing, and defence lawyers signalled plans to appeal.
“Dr Kapoor is disappointed in the verdict, as are we,” Beth Wilkinson, Kapoor’s lead attorney, said in a statement. “Four weeks of jury deliberations confirm that this was far from an open-and-shut case.”
Two other executives pleaded guilty and testified at the trial in Boston which lasted a little over two months.
“Today’s convictions mark the first successful prosecution of top pharmaceutical executives for crimes related to the illicit marketing and prescribing of opioids,” federal prosecutor Andrew E Lelling said in a statement.
“Just as we would street-level drug dealers, we will hold pharmaceutical executives responsible for fuelling the opioid epidemic by recklessly and illegally distributing these drugs, especially while conspiring to commit racketeering along the way,” he said.
In 2017, President Donald Trump declared the opioid crisis a national public health emergency.
Almost 400,000 people have died from overdoses involving prescription or illicit opioids over the past two decades, according to the US Centres for Disease Control and Prevention (CDC).
Nearly 48,000 people died in 2017 alone from opiate overdose.
“This is a landmark prosecution that vindicated the public’s interest in staunching the flow of opioids into our homes and streets,” Lelling said.
To increase sales of their fentanyl spray Subsys, a painkiller 50 to 100 times stronger than morphine, Insys executives established a system of large-scale bribes.
Between 2012 and 2015, they paid health professionals to prescribe large quantities of the highly addictive drug.
The US Food and Drug Administration (FDA) approved Subsys in 2012 only for use in treating severe cancer pain.
Doctors were encouraged to recommend the spray to patients who did not need it and also in excessive doses.
Officially, the bribes were paid as fees to doctors speaking at seminars for health professionals to praise the benefits of the drug.
The company’s aggressive marketing tactics reportedly also included sales representatives making a catchy rap video to promote the drug.
In some years, Insys paid more than $10mn in bribes in this way.
The heads of the firm also set up a scheme to mislead health insurance companies to reimburse patients for the costs of the drug.
Kapoor’s lawyers acknowledged Insys paid doctors but contended that he believed they were being legally paid to discuss Subsys’ benefits.
Wilkinson in her opening statement in January told jurors that Kapoor had no knowledge of “side deals” being cut with doctors.
She said a former executive turned government witness, Alec Burlakoff, kept Kapoor in the dark about them.
Burlakoff, Insys’ former vice-president of sales, and Michael Babich, its former chief executive, testified against Kapoor after pleading guilty to participating in the scheme.
According to Insys’ annual report, Subsys sales reached $329.5mn in 2015.
The group went public in 2013.
Kapoor resigned from the board in October 2017, a few days after his indictment.