Billionaire Charged In New Jersey Woman's Opioid Overdose Death

The billionaire founder of Insys Therapeutics, Inc. has been charged in connection with the death of a South Jersey woman who overdosed on the drug Subsys, authorities announced Friday.

John N. Kapoor, who is one of Arizona's wealthiest men, has been added as a defendant to an amended consumer fraud and false claims complaint against Insys Therapeutics, Inc. — the maker of the powerful opioid-fentanyl drug Subsys, Attorney General Christopher S. Porrino announced.

Insys and the 74-year-old Kapoor, of Phoenix, are accused of making false claims about the drug and providing incentives to health-care providers to prescribe the drug to several patients that didn't need it.

The drug is approved by the federal Food and Drug Administration (FDA) only for treating pain for certain cancer patients. However, authorities allege a physician in New Jersey was misled into prescribing the drug to treat 32-year-old Camden County resident Sarah Fuller for fibromyalgia in 2016.

The physician said an Insys sales representative misled her by claiming Subsys was appropriate for treating Fuller's non-cancer pain, according to the complaint. Fuller ultimately died of a Subsys-related overdose.

The push was part of an alleged plot to expand what the company recognized as a limited market for Subsys by aggressively pushing “off label” uses of the drug, authorities claim.

This included marketing it to podiatrists and other specialty doctors who normally would not treat cancer patients or prescribe powerful Schedule II painkillers like Subsys. Off-label use means the drug was prescribed for purposes other than that for which it was approved by the FDA.

Additionally, two New Jersey state employee health-benefits plans paid a total of about $10.3 million to reimburse Subsys prescriptions between 2012 and 2016, while the State Worker’s Compensation Program paid another $300,000, according to the complaint.

Kapoor founded Insys in 1990 and is its principal shareholder, according to authorities. He also held executive management positions in the company including executive chairman of the Board of Directors, president and chief executive officer.

Kapoor claims he was “not involved in day-to-day operations” concerning Subsys and that he was merely “an investor” in the company, but the state alleges he was closely involved in the illegal push to have Subsys inappropriately – and dangerously – prescribed for patients with routine chronic pain.

Since the drug’s launch in 2012, Subsys has accounted for 98 percent of net revenues for Insys, a Delaware corporation with headquarters in Chandler, Arizona. The company has increased the price of the drug every year since its launch, and sold $74.2 million worth of the drug in New Jersey between 2012 and 2016.

Kapoor and Insys are charged with three counts of violating New Jersey’s Consumer Fraud Act and one count of violating the New Jersey False Claims Act. The suit asks that Insys and Kapoor face the maximum penalty for each violation, and three times the state’s actual damages. It also seeks to have Insys and Kapoor held responsible for costs and fees incurred by the state related to the case.

Kapoor emigrated from India decades ago and earned a Ph.D. in medicinal chemistry from the University of Buffalo in New York, where the pharmacy school is named for him and his wife to honor their philanthropy.

In addition to Insys Therapeutics, which went public in 2013, Kapoor founded Illinois-based Akorn Pharmaceuticals. He also has a company that operates seven restaurants.

At one point, Forbes said Kapoor was worth $2.4 billion, but that number has since dropped.

Photo: Billionaire founder of Insys Therapeutics John Kapoor leaves U.S. District Court after being arrested earlier Thursday, Oct. 26, 2017, in Phoenix. Kapoor and other defendants in the fraud and racketeering case are accused of offering bribes to doctors to write large numbers of prescriptions for a fentanyl-based pain medication meant only for cancer patients with severe pain. (AP Photo/Ross D. Franklin)