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New Jersey files charges against drug company, former CEO, over opioid crisis

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The State of New Jersey has filed an amended consumer fraud and false claims complaint against Insys Therapeutics and its founder, billionaire John Kapoor, over charges that the company engaged in an unlawful marketing campaign designed to increase sales of its opioid-based pain killer, Subsys.

The case was filed in Superior Court in Middlesex County. In the complaint, state Attorney General Christopher Porrino claims that Insys endangered the public by engaging in “a greed-driven, unlawful marketing campaign designed to exponentially increase sales of Subsys by making fraudulent claims and unlawfully incentivizing health care providers to prescribe Subsys to an inappropriately broad array of pain patients.”

The state also claims that Kapoor was directly involved in the marketing campaign of Subsys by exercising “firm direction and close management of the illegal push to have Subsys dangerously prescribed for patients with routine chronic pain.”

Kapoor was already charged as part of a U.S. Justice Department probe for allegedly engaging in a scheme to pay speaker fees and bribing medical practitioners in the state to prescribe Subsys and to defraud insurers into approving payment. He was arrested Oct. 26 in Arizona, where Insys is based.

Insys, in a public statement on Oct. 29, announced that Kapoor had resigned from its board and that the company had recorded $150 million as its best estimate for the minimum amount it would pay to settle the U.S. Department of Justice probe.

Kapoor’s attorney, Brian Kelly, called the charges against Kapoor “thin,” and said that Kapoor was not intimately involved in the marketing practices of Subsys.

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Vince Calio

Vince Calio


Vince Calio covers health care and manufacturing for NJBIZ. You can contact him at vcalio@njbiz.com.

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