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Burroughs overturned convictions for alleged violations of the Controlled Substances Act and for alleged honest services fraud arising from the executives’ part in marketing and selling Subsys.
The drug is a highly addictive synthetic opioid that was intended to manage cancer pain.
Judge Burroughs called the conduct of the pharmaceutical company and the defendants “reprehensible,” saying they tried to “financially incentivize” doctors to prescribe Subsys without regard for their patients’ health. However, she found that the government failed to prove key elements needed for conviction of Kapoor and three other former colleagues — Richard Simon, Sunrise Lee, and Joseph Rowan.
A fifth executive, Michael Gurry, was convicted in May of mail fraud and wire fraud. Those convictions still stand.
In her 85-page ruling Judge Burroughs wrote, “although the evidence clearly shows that Defendants intended to try to sell as much Subsys as possible and wanted healthcare practitioners to prescribe it and to prescribe it at the higher and more expensive doses, there is not evidence sufficient to prove that Defendants specifically intended, much less intended beyond a reasonable doubt, that healthcare practitioners would prescribe Subsys to patients that did not need it or to otherwise abdicate entirely their role as healthcare providers.”
In other words, the men did not ask doctors to prescribe the drug to patients who did not need it.
‘Landmark’ prosecution
In her explanation for overturning the second conviction on honest services fraud, Burroughs said “the Government did not establish that any defendant agreed and specifically intended that a healthcare practitioner would prescribe Subsys outside the usual course of medical practice and without any legitimate medical purpose.” That is, while Insys pressured doctors to prescribe Subsys in high amounts, the drug was still going to patients with legitimate medical issues.
The ruling is a setback for federal prosecutors who hailed the May convictions as “the first successful prosecution of top pharmaceutical executives for crimes related to the illicit marketing and prescribing of opioids,” and said the verdict was a landmark prosecution, and a victory against executives who put greed ahead of the American public.
From 1999 to 2017, almost 400,000 people died from an overdose involving opioids — including prescription and illicit opioids, according to the US Centers for Disease Control and Prevention.
Despite this win for the defendants, all still face sentencing in January for their convictions on mail fraud and wire fraud charges. After the partial overturning of their convictions, it’s unclear what the defendants’ maximum potential sentencing could be.
The US attorney’s office had no comment on Tuesday’s ruling. Lawyers for Kapoor and Gurry did not return requests for comment. CNN was unable to immediately ascertain who represents the other defendants.
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