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Billionaire Opioid CEO Found Guilty in Scheme to Bribe Doctors with Lap Dances and Lavish Dinners

The scheme was meant to encourage doctors to overprescribe a fentanyl-based spray.

by Alex Lubben
May 2 2019, 10:00pm

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The billionaire former CEO of one of the county’s biggest opioid manufacturers was found guilty Thursday in a scheme to bribe doctors to prescribe a fentanyl-based spray.

John Kapoor, the 75-year-old founder of Insys Therapeutics, became the first pharmaceutical executive to be convicted of racketeering in the slew of litigation that’s come out of the opioid epidemic. He was also found guilty of defrauding insurance companies to peddle Subsys, an opioid spray approved for terminally ill cancer patients. The drug, however, wound up being widely prescribed for other kinds of conditions that involved chronic pain.

Kapoor was convicted along with four other former Insys execs after the jury deliberated for 15 days. All are facing a maximum sentence of 20 years in prison.

The scheme that prosecutors said Kapoor pulled off involved Insys employees paying doctors for sham events and taking them to lavish dinners at restaurants that Kapoor owned and strip clubs. Michael Babich, who stepped down as Insys’ CEO in 2015, pleaded guilty to being involved in the scheme in January and became a cooperating witness for the prosecution.

The trial was peppered with some pretty wild revelations. Babich testified that the company hired good-looking sales reps because they thought doctors didn’t want an “unattractive person to walk in their door.”

Another event that came to light over the course of the trial: A former sales rep testified that she saw an Insys executive at a club in Chicago, giving a lap dance to a doctor to whom she was selling Subsys.

“Do you feel like you were getting a message about what tactics to use to market this product?” one of the prosecutors asked. The defense objected before the sales rep answered, according to the Boston Globe.

Jurors were also shown a video Insys sales reps had made, apparently a parody of rapper A$AP Rocky’s “Fuckin’ Problems.” During the video, one of the employees dressed up as a bottle of Subsys.

“I love titrations, yeah, that’s not a problem, and I got new patients, yeah, I got a lot of ‘em,” the rap goes. “Titration” is the process by which a physician gradually increases a drug’s dosage strength.

The verdict in Kapoor’s case is likely to be a signal to other pharmaceutical executives that the public is willing to convict on charges relating to the opioid crisis.

“A conviction will embolden prosecutors in other cases,” Paul Kalb, a partner at Sidley Austin LLP specializing in health-care fraud, told Bloomberg before the verdict came down. “Kapoor will be plainly portrayed as one of the instigators of the opioid crisis. But the truth is, this is a very complex problem that was not caused by any single person or company.”

Cover image: In this Jan. 30, 2019, file photo, Insys Therapeutics founder John Kapoor leaves federal court in Boston. Kapoor and four other former company executives are accused of scheming to bribe doctors into prescribing a powerful fentanyl painkiller. (AP Photo/Steven Senne, File)