Insys Therapeutics agreed to pay $225 million to resolve civil and criminal actions brought by the U.S. Justice Department over alleged kickbacks and marketing of its opioid painkiller, reports Law.com. Under the deal announced Wednesday, Insys agreed to pay $195 million to settle allegations in five separate whistleblower lawsuits that it violated the False Claims Act. Its operating subsidiary will plead guilty to five counts of mail fraud and pay a $2 million fine and $28 million in forfeiture. The settlement centers on Subsys, a fentanyl spray Insys manufactured and that the U.S. Food and Drug Administration approved in 2012 for the treatment of chronic pain in cancer patients.
The settlement “sends a strong message to pharmaceutical manufacturers that the kinds of illegal conduct that we have alleged in this case will not be tolerated. I want to assure the families and communities ravaged by this epidemic that the Department of Justice will hold opioid manufacturers accountable for their actions,” said Assistant Attorney General Jody Hunt of DOJ’s Civil Division. The deal comes after Insys disclosed that it might file for bankruptcy protection and could not afford the legal costs related to a Department of Justice’s investigation. Prosecutors said Insys and its operating subsidiary began paying bribes and kickbacks to medical professionals under the guise of being “speaking programs,” to increase marketing of Subsys from August 2012 to June 2015. The deferred prosecution agreement, expected to last five years, comes after five former Insys executives, including billionaire founder John Kapoor, were convicted last month of charges relating to marketing Subsys.