Insys to pay $225 million, unit to plead guilty to settle U.S. opioid charges

(Reuters) – Insys Therapeutics Inc agreed to pay $225 million and an operating unit agreed to plead guilty to five mail fraud counts to settle criminal and civil probes into its marketing of opioids, the U.S. Department of Justice said on Wednesday.

The probes stemmed from Insys’ alleged payment of kickbacks and other illegal marketing practices related to Subsys, an under-the-tongue spray that is intended to treat pain in adult cancer patients and contains fentanyl, an opioid 100 times stronger than morphine.

Insys has been exploring strategic options including the possible divesting of its Subsys business.

It had warned on May 10 that costs related to the probes could prompt it to seek bankruptcy protection.

Insys did not immediately respond to requests for comment. The plea agreement is being filed with the federal court in Boston.

Prosecutors said that from August 2012 to June 2015 the Chandler, Arizona-based company used sham “speaker programs” as a means to pay bribes and kickbacks to doctors, who would then prescribe Subsys to more patients and in increased dosages.

On May 2, a federal jury in Boston found Insys founder John Kapoor and four former Insys executives guilty of participating in a racketeering conspiracy to boost Subsys prescriptions.

Three other onetime Insys executives have also been convicted in Boston for crimes related to the marketing of Subsys, the Justice Department said.

Reporting by Jonathan Stempel in New York; editing by Bill Berkrot and Tom Brown

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