The U.S. District Court Judge Allison Burroughs in Boston has overturned parts of racketeering conviction against Insys Therapeutics founder and former sales executives, stating the prosecutors failed to prove that the manufacturer violated the Controlled Substances Act.
According to the order, the prosecutors did not present enough evidence against Insys founder John Kapoor and former executives Michael Gurry, Richard Simon, Sunrise Lee, and Joseph Rowan over allegations that the company bribed doctors to prescribe a powerful and addictive opioid spray for nonmedical purposes. The order will renounce the criminal conspiracy portion of defendants, which will have a huge impact on the sentencing scheduled for January in a Boston courthouse.
The executives convicted for the sales fraud charges will not be affected by the order. In June, the defendants agreed to pay $225M to end criminal and civil investigations imposed by the federal government. Following the settlement announcement, the company also declared bankruptcy and to undergo a court-supervised restructuring plan for the sale of its product, including the controversial Subsys. In September, a bankruptcy court approved to sell-off Subsys to Wyoming-based BTcP Pharma LLC, part of the MMB Healthcare network.
Companies manufacturing opioids convinced the medical community that these medications were not addictive and were purely beneficial. This belief raised the number of prescriptions and sales unwarrantedly, resulting in a mass misuse of these drugs, to the extent that this was identified by the U.S. Food and Drug Administration (FDA) as a public issue and named it an opioid crisis.
