Insys Therapeutics (NASDAQ:INSY) has settled a lawsuit with the state of Illinois, in which the company will have to pay $4.5 million due to their marketing and selling tactics of their fentanyl-based treatment Subsys.
The Chicago Tribune stated the settlement was official on Friday (August 18). The lawsuit, which was initially filed in 2016 by Illinois Attorney General Lisa Madigan claimed that the Insys promoted Subsys in the use against back and neck pain, despite claiming a lack of approval for these treatments.
“Insys pushed a highly addictive opioid in complete disregard for patients’ health to increase company profits,” Madigan said in a statement. “It’s unethical, greedy behavior by companies like Insys that is responsible for creating the opioid epidemic and resulting overdose deaths in our state.”
The money from the settlement will be used for the efforts against opioids in the state. As part of the settlement Insys will also have to follow through on these mandates, according to the office of the Attorney General:
- Create an Opioid Abuse Detection Program to identify prescribers who are abusing or aiding in the abuse of opioids.
- Restrict promoting Subsys only to oncologists and prescribers who have affirmatively stated they currently treat or are likely to treat patients with cancer pain.
- Prevent Insys employees from communicating with an Illinois patient’s insurance company regarding prior authorization of an opioid.
- Limit the number of times a prescriber can host an Insys speaker program and the number of times a prescriber can attend an Insys speaker program.
- Prohibit sales representatives from communicating about a particular patient with a prescriber, initiating direct communication with a patient, or having access to a patient’s medical records.
Insys has faced the force of settling with a state before
This isn’t the first time Insys has had to agree to the terms of a state due to the practice of their products. In 2016, the company settled with the state of New Hampshire in a suit of $2.9 million; the year before, Insys complied with the Oregon Department of Justice.
More notoriously, six former executives–including former CEO Michael Babich–were arrested for bribing doctors to prescribe Subsys, according to reporting from BioPharma DIVE, of Insys. More and more municipalities and states have decried the role of pharmaceutical companies in the opioid epidemic currently ailing the country.
President Donald Trump followed the recommendation from the White House’s commission on combating the opioid epidemic to declare the opioid epidemic a national crisis earlier this month. A move which Health and Human Services Secretary Tom Price had said wasn’t necessary.
As of 4:24 p.m. EST on Monday (August 21), the company’s share price had dropped 1.31 percent over the trading day. On a year-to-date basis, shares of the specialty pharmaceutical indicate a 1.63 percent decline overall.
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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.