After Drug Company Executives' RICO Convictions, Suit Over NJ Woman's Death Shifts Into High Gear
Founder and former chief executive John Kapoor and four other Insys executives were found guilty of charges that they made payouts to doctors who prescribed their products and misled insurance companies about whether patients needed the drugs.
May 03, 2019 at 06:27 PM
4 minute read
A family's lawsuit against Insys Therapeutics involving a woman's fatal overdose on the opioid Subsys is resuming in New Jersey following Thursday's racketeering conviction of the company's founder and four other executives in a separate case.
Founder and former chief executive John Kapoor and four other Insys executives were found guilty of charges that they made payouts to doctors who prescribed their products and misled insurance companies about whether patients needed the drugs. The convictions, following a 10-week federal trial in Boston, marked the first successful prosecution of top pharmaceutical executives for crimes related to the illicit marketing and prescribing of opioids.
The convictions were welcome news to plaintiffs counsel in a suit over the death of Sarah Fuller of Stratford, who died from an adverse reaction to Subsys, a liquid form of fentanyl sold by Insys. A suit by Fuller's family against Insys, Kapoor and two other company executives, Michael Babich and Alec Burlakoff, had been stayed while the criminal trial was underway in Boston. Lifting the stay will permit completion of some key steps, including obtaining a deposition from Kapoor, so the case can proceed toward a jury trial, said Richard Hollawell, a lawyer for Fuller's parents.
And the criminal convictions bode well for a victory in the civil case, Hollawell said.
“These guys have just gone through a criminal trial under RICO, which is a very high standard, and a jury adjudicated that they committed acts of racketeering. The elements overlap” between the civil and criminal cases, said Hollawell, of Richard J. Hollawell & Associates in Woolwich Township.
New Jersey and several other states have also filed their own suits against Insys and Kapoor. New Jersey's suit, in state Superior Court in Middlesex County, is “ongoing,” said a spokesman for the attorney general.
In the Boston case, Babich and Burlakoff entered guilty pleas and testified during the trial.
In the Fuller case, the defendants face claims for negligence, fraud, negligent misrepresentation and punitive damages. Fuller, of Stratford, died at age 32 in 2016 after taking Subsys and alprazolam for fibromyalgia and back pain from two car accidents. Although Subsys was approved only for treatment of cancer, Fuller began taking it after her doctor arranged for her to meet with a sales representative from Insys who promoted the drug for her conditions.
Fuller's physician, Vivienne Matalon, and Linden Care, a Woodbury, New York, specialty pharmacy company that provided the drugs to Fuller, were initially named in the suit but both have settled under confidential terms, said Hollawell.
Hollawell said he has petitioned the court to add another defendant in the Fuller case, Rochester Drug Cooperative, which allegedly supplied the Subsys to Linden Care. Information about Rochester's role came out in a wrongful dismissal suit against that company by its former CEO, Laurence Doud III, said Hollawell.
And a former Insys sales representative, Michelle Breitenbach, pleaded guilty, also in Middlesex County, to her part in an alleged scheme in which doctors were bribed to increase off-label prescriptions of Subsys.
Insys is also a defendant in some of the hundreds of suits brought by cities and counties against the opioid industry, which is consolidated before U.S. District Judge Dan Polster of the Northern District of Ohio.
The lawyer representing Insys in the Fuller case, Philip Crawford of Gibbons in Newark, did not return a reporter's call. Nor did Israel Dahan of King & Spalding in New York, who represents Babich, or Kurt Mullen of Nixon Peabody in Boston, who represents Kapoor in the case.
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