Prosecutors Portray Drug Company Founder As Greedy In Day 1 Of Opioid Kickback Trial

A federal prosecutor said a pharmaceutical company founder “put profits over people” by bribing doctors around the country to prescribe a highly addictive fentanyl spray.

In the first day of a closely-watched trial, Assistant U.S. Attorney David Lazarus told jurors Monday in Boston’s federal court that John Kapoor, founder of Arizona-based Insys Therapeutics Inc., created a “criminal conspiracy” that paid eight doctors and other prescribers more than $1.1 million to prescribe its drug, Subsys.

The spray was approved by the FDA in 2012 to treat acute pain for cancer patients, but Lazarus said Kapoor wanted to dominate the market in pain management and provided kickbacks to doctors to prescribe the medication to patients who often didn’t have cancer.

“Although the product was selling, Kapoor wasn’t happy with how it was selling,” said Lazarus. “He wanted more success. He demanded success at all costs.”

Kapoor and four other defendants face charges of conspiracy to commit racketeering for operating the company as a “criminal enterprise from top to bottom,” said Lazarus.

Prosecutors said the kickbacks took several forms including lavish dinners provided through a speaker program, paying for doctors’ staff from the company's own budget and providing bonuses. In addition, Lazarus said Insys ran an in-house call center where employees frequently pretended to call from doctors' offices and defrauded insurance companies to cover claims for Subsys.

Beth Wilkinson, Kapoor’s lawyer, said the government’s case left out important information. She detailed how Insys was open about its speaker program and posted the payments it made to doctors online.

Wilkinson refuted the prosecutor’s claim that Kapoor was greedy, saying that the medication sold itself and made up less than one percent of all opioid prescriptions.

“There is nothing illegal about that, and there was certainly nothing secret about that,” she said.

Kapoor was motivated not by greed, according to his lawyer, but by a desire to help people dealing with excruciating pain. Kapoor watched his wife suffer from breast cancer and was driven to provide other patients with a chance at relief, she said.

Wilkinson also sought to discredit the government’s key witnesses: two former Insys executives who pleaded guilty and are cooperating with prosecutors.

According to emails Wilkinson presented in court, former sales executive Alec Burlakoff -- not Kapoor — was the man who sought to cut side deals, and he tried to keep Kapoor out of the speaker program.

Wilkinson further pointed out that Burlakoff later told prosecutors that he was willing to say anything to help himself.

“Burlakoff lied over and over to federal agents," Wilkinson said. “He realized that there was no way out for him and pleaded guilty, but his story doesn’t make sense.”

The trial could last more than three months and will include testimony from doctors paid by the company and sales representatives who worked with the executives.