In 2012, drug maker Insys Therapeutics received approval to sell an “ultra-powerful” opioid (a sprayable form of fentanyl called Subsys) for cancer patients with acute pain but quickly realized that the market for their drug was thin. So, according to a federal indictment and ongoing congressional investigation by Senator Claire McCaskill (D- Missouri), they simply created patients who needed their drug. They did so by “falsifying medical records, misleading insurance companies, and providing kickbacks to doctors in league with the company.” 1
“Because of the high cost associated with Subsys, most insurers wouldn’t pay for it unless it was approved in advance. That process, likely familiar to anyone who’s taken an expensive medication, is called ‘prior-authorization.’
So Insys set up an elaborate charade — with employees that pretended to be doctors’ offices — to fool insurance companies into approving the drug, according to the Senate report.”2
As you might imagine, the company played pass the buck blaming former employees and insisting that over the last four years they have sought to strengthen their compliance program, a move that has cost them “significant resources”.
- When someone needed to obtain prior approval for a Subsys prescription, an Insys employee would call the insurer and their affiliates to persuade them (insurers thought they were talking to someone who worked for the actual patient’s doctor) with a specific script designed to intentionally leave that impression.
- Insys also obscured their outgoing phone number on caller IDs, so calls couldn’t be traced back to the company. If insurers needed a phone number for a return call, company employees would (allegedly) provide a 1-800 number manned by another Insys representative.
- Since cancer was a requirement for the prescription, Insys employees would use creative ways to let insurers believe the patient had acute pain caused by cancer (known as “breakthrough” pain), without explicitly saying so.
You can listen to an example call below. The woman an Insys employee is seeking Subsys for, died last year of a Subsys overdoes:
This investigation is just one of many. Back in December, federal prosecutors in Boston “criminally charged six former Insys executives, including its former CEO, with fraud and racketeering charges related to Subsys” (those cases are pending but the execs charged have all pled not guilty). Still other federal charges have been brought against individuals connected to Subsys and several state attorneys general have filed lawsuits of their own.