Founder of Insys Therapeutics Inc., John Kapoor, is charged with racketeering conspiracy and other felonies to illegally get the medication Subsys prescribed to patients who did not have cancer.
Indian American billionaire, John Kapoor, was arrested Thursday and charged with felonies including the RICO conspiracy. The 74-year-old entrepreneur was scheduled to appear in federal court in Phoenix today.
“The founder and majority owner of Insys Therapeutics Inc., was arrested today and charged with leading a nationwide conspiracy to profit by using bribes and fraud to cause the illegal distribution of a Fentanyl spray intended for cancer patients experiencing breakthrough pain,” Department of Justice said in a statement.
The charges also include allegations against other Insys executives and managers who were indicted in December 2016.
Other executives charged for conspiracy to bribe practitioners in order to prescribe a fentanyl-based pain medication are: Michael L. Babich, 40, of Scottsdale, Ariz., former CEO and President of the company; Alec Burlakoff, 42, of Charlotte, N.C., former Vice President of Sales; Richard M. Simon, 46, of Seal Beach, Calif., former National Director of Sales; former Regional Sales Directors Sunrise Lee, 36, of Bryant City, Mich., and Joseph A. Rowan, 43, of Panama City, Fla.; and former Vice President of Managed Markets, Michael J. Gurry, 53, of Scottsdale, Ariz.
“In the midst of a nationwide opioid epidemic that has reached crisis proportions, Mr. Kapoor and his company stand accused of bribing doctors to overprescribe a potent opioid and committing fraud on insurance companies solely for profit,” said Acting United States Attorney William D. Weinreb. “Today’s arrest and charges reflect our ongoing efforts to attack the opioid crisis from all angles. We must hold the industry and its leadership accountable – just as we would the cartels or a street-level drug dealer.”
The statement said the FBI will thoroughly investigate such business practices that ignore a patient’s safety to drive up profits.
A graduate of Bombay University in India, Kapoor received his PhD in Medicinal Chemistry from the State University of New York at Buffalo.