Insys hit with lawsuit, fine for opioid marketing
- New Jersey is the latest state to bring charges against opioid drugmaker Insys Therapeutics Inc., charging the biotech conducted a "greed-driven campaign of consumer fraud and submission of false claims to health insurers" to promote its drug Subsys.
- The lawsuit also alleges that at least one New Jersey resident died due to Subsys and that state employee health plans paid out as much as $10.3 million in reimbursement for prescriptions of the drug.
- This new litigation comes on the heels of a $500,000 settlement with the state of Massachusetts that alleged the company engaged in a "widespread scheme to unlawfully market its fentanyl spray and paid kickbacks to providers to persuade them to prescribe the product."
Insys' latest legal battle, this time brought by New Jersey Attorney General Christopher Porrino and filed in Middlesex Superior Court, accuses the company of pushing off-label use of the drug "even to podiatrists and other specialty practitioners who typically would have little call to prescribe powerful Schedule II painkillers."
Subsys (fentanyl) is an under the tongue opioid spray that was approved in 2012 for the treatment of breakthrough pain in cancer patients who are tolerant to opioid treatments.
Despite the particularly narrow patient population, 98% of Insys revenues come from the sale of Subsys. Yet, the lawsuits and crack down on unlawful marketing practices have taken its toll on the company’s revenues. In the most recently reported quarter, Insys only brought in $42 million for the three-month period, down from $69 million the year prior.
Porrino said Insys raised the cost of the drug every year since its approval in 2012 — a one month supply of 100 microgram doses cost $2,800 in 2012 and was more than $4,000 by 2015. Insys sold $74 million worth of the drug in NJ since its approval.
"Insys made tens of millions of dollars in sales in New Jersey," said Porrino. "Clearly, raking in more money was the engine that drove this subversive and illegal plan to push a potent and, in the wrong patient, potentially lethal form of fentanyl to a broader audience. As we explicitly claim in our lawsuit, Insys and its leadership were willing to do whatever was necessary to make Subsys successful."
The New Jersey lawsuit seeks maximum civil penalties for each violation of the Consumer Fraud Act, and three times the state’s actual damages for violations of the False Claims Act. The state is also looking for the company to pay any fees related to bringing the suit forward.
The lawsuit is being brought against Insys on the backdrop of an opioid overdose epidemic. In New Jersey alone, the number of deaths that have occurred due to opioid overdose jumped from 840 in 2010 to 1,000 for just the first half of 2016. The opioid crisis has been sweeping the nation and pushing both state and federal lawmakers to take action against any parties that might be contributing to the spread of easily-abused, highly-addictive drugs.
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