Two former employees at Insys Therapeutics, the maker of the drug Subsys, which contains the powerful and addictive opioid fentanyl, pleaded guilty this week to violating anti-kickback laws.
It’s part of an ongoing investigation that illustrates how Insys became the poster child for the evils of the opioid crisis and how some companies stopped at nothing to addict America.
Natalie Levine, who is married to Insys’ former CEO, Michael Babich, pleaded guilty in Connecticut on Tuesday, and Karen Hill pleaded guilty in Alabama. Both women, former sales reps, face up to five years in prison. The company’s stock is down about 8% on the news.
Levine admitted to paying off medical practitioners to get them to prescribe Subsys under the guise of a legal speaker program. The program, however, was a scam.
“The Speaker Programs, which were typically held at high-end restaurants, were ostensibly designed to gather licensed healthcare professionals who had the capacity to prescribe Subsys and educate them about the drug. In truth, the events were usually just a gathering of friends and co-workers, most of whom did not have the ability to prescribe Subsys, and no educational component took place.
“‘Speakers’ were paid a fee that ranged from $1,000 to several thousand dollars for attending these dinners. At times, the sign-in sheets for the Speaker Programs were forged so as to make it appear that the programs had an appropriate audience of healthcare professionals.”
Hill pleaded guilty to participating in the same sham speaker program, which helped to facilitate a $40 million opioid “pill mill” in Mobile, Alabama, a medical practice belonging to Drs. Xiulu Ruan and John Patrick Couch that overprescribed medication and engaged in insurance fraud. Ruan and Couch have been sentenced to 21 and 20 years in prison, respectively.
In June, Elizabeth Gurrieri, a former manager of reimbursement services for Insys, pleaded guilty to wire fraud conspiracy.
- Thomson Reuters
Things are likely to get worse this week for Insys and other opioid makers. According to Bloomberg, Attorney General Jeff Sessions is set to announce more measures to crack down on fraudulent opioid-insurance claims and on fraud in opioid treatment centers. Hundreds of arrests are expected to be carried out in cities around the country, according to the report.
Federal prosecutors in Boston in December announced charges against a half-dozen Insys executives after years of reported shocking behavior. The investigative journalist Roddy Boyd at the Southern Investigative Reporting Foundation has done fascinating work highlighting it.
In 2015, he reported that Sunrise Lee, the former head of Insys’ central and western sales regions, had no pharmaceutical-sales experience before joining the company. She had previously worked as a dancer at Rachel’s, a West Palm Beach strip club, Boyd reported.
“Doctors really enjoyed spending time with her and found Sunrise to be a great listener,” Alec Burlakoff, Insys’ national sales chief at the time, told SIRF. Burlakoff, Lee, and Babich were among the executives charged in December.
“She’s more of a ‘closer,'” he continued. “Often the initial contact [with a doctor] was made by another salesperson.”