According to U.S. prosecutors, the former CEO of Insys Therapeutics has agreed to plead guilty for participating in a scheme which bribes doctors to prescribe a robust opioid medication to increase its sales.
The resigned Arizona-based drugmaker’s CEO, Michael Babich, is about to face trial in the following month. He pleaded guilty to mail fraud and conspiracy charges, federal prosecutors in Boston disclosed in a court filing.
About five former Insys managers and executives were also accused along with Babich and John Kapoor, who is the company’s former chairman and founder, are to be scheduled for trial later in January. They pleaded not guilty.
Babich’s plea deal terms weren’t disclosed, and it was unclear to them whether he would agree to cooperate with the prosecutors to testify during the trial, as another former Insys executive has recently pleaded guilty to leading a riot scheme.
The case focuses on Subsys, Insys tongue spray that helps manage pain in cancer patients. The spray contains fentanyl, which is an opioid 100 times stronger than standard morphine.
The prosecutors claim that from the year 2012 to 2015, Babich, Kapoor, and the others have cooperated to bribe doctors in exchange for prescribing their patients with Subsys. The prosecutors also claim that they had also defrauded insurers into paying for Subsys.
The case has been brought up in the middle of a national opioid crisis. According to the Center for Disease Control and Prevention in the U.S., opioids were implicated in around 47,600 of overdose deaths in 2017.
Babich is married to Natalie Babich, who is a former Insys sales representative that plead guilty in 2017 and became a key witness in the case.
She has testified at the trial of Christopher Clough, who is a former physician assistant in New Hampshire accused of accepting bribes from Insys. The federal jury of Concord found Clough guilty on December 18th.
In August, Insys said that they agreed to settle the related U.S. Justice Department probe for $150 million.