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When Fueling the Opioid Epidemic Amounts to Organized Crime

A Boston jury found John Kapoor, one-time billionaire and founder/chairman of drug company Insys Therapeutics (-1.66%), guilty of a racketeering conspiracy to boost sales of a fentanyl-based drug—and throw gasoline on the opioid crisis fire.
How it went down: The federal government accused Kapoor and four colleagues of running a nationwide bribery scheme from 2012 to 2015 to peddle the painkiller Subsys, which was up to 100x stronger than morphine.
According to the government’s 39 witnesses, Insys propagated the opioid crisis by...
  • Step one: Bribing doctors to prescribe Subsys using cash, appealing sales reps, lavish dinners, and more.
  • Step two: Lying to insurance companies to make sure the very expensive drug was covered.
Kapoor’s camp argued he was unaware of any illegal schemes going on.
We found this interesting: One attorney following the case told NPR that by charging Kapoor & Co. with racketeering, the federal government considered the scheme “organized crime.” Racketeering charges were originally designed to go after the mafia.

But this is bigger than Insys

While Kapoor is the highest-ranking pharma exec to be convicted in a case tied to the opioid crisis, his trial was viewed as something of a referendumon the pharmaceutical industry’s role in the country’s public health emergency.
Per Bloomberg, Kapoor’s conviction shows “the public is willing to hold executives accountable for the U.S. crisis,” which has taken hundreds of thousands of lives and cost billions of dollars annually.
  • More than 130 people in the U.S. die every day after overdosing on opioids.
  • The CDC says roughly 218,000 people died from prescription opioid overdoses from 1999 to 2017.
Zoom out: This verdict will echo around the industry. Other Big Pharma players like Teva, Purdue, Johnson & Johnson, and Endo are all preparing to face trials over similar allegations.

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