Federal Judge Overturns Part Of Opioid-Maker's Conviction

Nov 26, 2019
Originally published on November 27, 2019 4:47 am

In a high profile opioid case, a federal judge has overturned, in part, convictions against executives at Insys Therapeutics, the maker of a liquid fentanyl painkiller called Subsys. U.S. District Court Judge Allison Burroughs in Boston ruled that prosecutors failed to prove that Insys violated the Controlled Substances Act.

The convictions for wire and mail fraud handed down in May against Insys Therapeutics founder John Kapoor and former executives Michael Gurry, Richard Simon, Sunrise Lee and Joseph Rowan, still stand.

In her decision, Burroughs ruled that the government failed to prove that the defendants intended to commit bribery and extortion, which means the earlier convictions of honest services fraud and violating the Controlled Substances Act will be thrown out.

"The Government could have easily proved bribery, but it elected not to charge bribes or kickbacks and now must live with that decision," Burroughs wrote in her ruling. "The Court only very reluctantly disturbs a jury verdict, but finds it necessary to do so here."

In 2017, Kapoor and six others at Insys were arrested and charged with felony counts including conspiracy, wire and mail fraud, forfeiture and racketeering.

Kapoor was found guilty in May on all counts, but his sentencing has been delayed for months.

Opioid maker's actions "reprehensible"

Though the conviction was partially overturned Tuesday, Burroughs noted in her ruling that the decision was not intended to "condone or minimize" the actions of the company's leaders in marketing the powerfully addictive Fentanyl spray, Subsys.

"The conduct of Insys and the Defendants in this case was reprehensible and designed to financially incentivize healthcare practitioners to prescribe Subsys without regard for the best interests of their patients," Borroughs wrote. "Defendants knew the power of Subsys and that addiction was a risk, but nonetheless tried to maximize the number of prescriptions written and the dosage prescribed."

Kapoor's attorney and a spokesperson for Insys declined to comment for this story.

Brad Bailey, a Boston-based criminal defense attorney and a former federal prosecutor, says the ruling, "shouldn't have surprised anybody ... because the underlying product was a Fentanyl-based spray that had a legitimate medical use on the market. To conflate that into narcotics distribution is a real slippery slope."

The defendants are now scheduled for sentencing in the second week of January 2020.

According to Bailey, it's too early to say what impact the dropped conviction might have on the sentence, "It is going to bring down the calculus and result in a sentence that's going to be less tomorrow than what it was this morning."

In 2012, the FDA approved Subsys, a fentanyl spray product manufactured by Insys for use by patients seeking relief from cancer pain. After an unsatisfactory launch of the product that year, Insys began a more aggressive marketing strategy that fall. The company recommended higher doses of the addictive drug and allegedly made financial deals with prescribers to write large numbers of prescriptions for patients, many of whom were not diagnosed with cancer.

Last month, Kapoor's attorneys requested a new trial. In her ruling Tuesday, Borroughs denied that request.

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