Opioid Crisis: Insys Therapeutics Agrees To Settle For $225M

Introduction

Insys Therapeutics Inc. has agreed to pay $225M to end criminal and civil investigations imposed by the federal government over allegations that the company bribed doctors to prescribe a powerful and addictive opioid spray.

The company had announced in August 2018, that it would pay at least $150 million and then possibly another $75 million. Following the recent agreement, the company will enter into a delayed prosecution and has pleaded guilty to five counts of mail fraud, paying a $2 million fine and $28 million forfeiture. The company will also pay $195 million to settle allegations that it violated the False Claims Act. The Boston jury convicted five former Insys executives including founder John Kapoor of a racketeering conspiracy. In all, eight company executives have been convicted or plead guilty in Massachusetts federal court. Insys has entered into a five-year corporate integrity agreement with the U.S. Department of Health and Human Services that would allow the company to continue participating in federal healthcare programs.

In a similar trial held in March and May this year, OxyContin maker Purdue Pharma LP made a settlement of $270 million, and Teva Pharmaceuticals made a settlement of $85 million, respectively. U.S. District Judge Dan Polster is presiding over more than 1,900 suits filed by U.S. cities and counties of which more than 1,600 cases are filed largely by local governments, Native American tribes, and hospitals. The first trial in the MDL No. 2804 is set to start in October 2019.

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