he former chief executive of Insys Therapeutics and several other former executives were arrested Thursday on federal charges of conspiring to bribe doctors to prescribe a prescription version of the potent opioid fentanyl.
The painkiller, called Subsys, is approved by the Food and Drug Administration for cancer patients who suffer from intense bouts of pain that are not controlled by other opioid medications. In exchange for bribes and kickbacks offered by Insys employees, several doctors wrote large numbers of Subsys prescriptions for patients who did not have cancer, prosecutors said.
“As alleged, top executives of Insys Therapeutics, Inc. paid kickbacks and committed fraud to sell a highly potent and addictive opioid that can lead to abuse and life threatening respiratory depression,” Harold H. Shaw, the head of the Boston office of the FBI, said in a statement. “In doing so, they contributed to the growing opioid epidemic and placed profit before patient safety.”
The executives arrested include former Insys CEO Michael Babich of Scottsdale, Ariz.; the former national sales director, Richard Simon of Seal Beach, Calif.; the former vice president of sales, Alec Burlakoff of Charlotte, N.C.; and two former regional sales directors.
An attorney for Burlakoff, George Vien of Boston, said his client would plead not guilty and “fight the case.” The other defendants or their lawyers couldn’t be immediately reached for comment.
Insys, in a statement posted on its website, said the charges announced Thursday “relate to previously disclosed investigations.” The company said it would cooperate with authorities in ongoing investigations and is “committed to complying with laws and regulations that govern our products and business practices.”
While doctors are allowed to prescribe drugs for conditions not approved by the FDA, a practice known as off-label prescribing, drug makers are not permitted to promote medications for these purposes. Insys, based in Chandler, Ariz., has previously reported it is under investigation by several state attorneys general and federal prosecutors for the marketing of Subsys.
Previously, both an Insys sales rep in Alabama and a nurse in Connecticut pleaded guilty to federal kickback charges related to off-label Subsys prescribing.
Subsys is the only brand-name drug Insys sells. In 2011, the year before it hit the marketplace, Insys was operating at a loss with no reported revenue. Last year, company revenues were $330 million; it reported a profit of $58.5 million. Lately, it has reported declining sales of the drug.
The company recently announced that its founder, John Kapoor, would be stepping down as chief executive.
In September, STAT reported on the case of a New Jersey woman who fatally overdosed while taking Subsys. She did not have cancer, and when her doctor switched her from other painkillers to Subsys, a sales representative from Insys was in the room to discuss the medication, according to the woman’s family.
The doctor in that case has agreed to a license suspension while the state board of medicine investigates the case.