U.S. senator reveals results of opioid inquiry into Insys

By Nate Raymond

BOSTON (Reuters) - Insys Therapeutics Inc sought to manipulate insurance payment approval for an opioid cancer pain drug called Subsys even if for inappropriate uses, according to a U.S. Senate report on the opioid crisis released on Wednesday.

The report, released by Democratic Senator Claire McCaskill, said those efforts led to an Insys employee making misleading statements to get insurance to cover a prescription for a woman who according to a lawsuit died after taking Subsys.

The report was the first by McCaskill, the ranking Democrat on the U.S. Senate Homeland Security and Governmental Affairs Committee, to flow out of her investigation into drugmakers' roles in the national opioid addiction epidemic.[nL3N1H552Z]

The report came amid a series of federal and state investigations centered on the marketing of Subsys, an under-the-tongue spray intended for cancer patients that contains fentanyl.[nL2N1LH1N3]

Fentanyl is a man-made opioid that is 100 times more powerful than morphine.

In December, federal prosecutors in Boston charged six former Insys executives and managers, including former Chief Executive Michael Babich, with engaging in a scheme to bribe doctors to prescribe Subsys. They have pleaded not guilty.

McCaskill's report said that Chandler, Arizona-based Insys lacked measures to prevent employees from manipulating the process insurers and pharmacy benefit managers use to deter over-prescription by requiring pre-approval of medicines.

The report noted that in June, Elizabeth Gurrieri, a former manager of reimbursement services for Insys, pleaded guilty to conspiring to defraud insurers into paying for Subsys.

It also cited the case of Sarah Fuller of New Jersey, who died in March 2016 after seeking treatment two years earlier for conditions including back pain, according to a lawsuit her family filed against Insys.

McCaskill's report said an audio recording showed that an Insys employee misled a pharmacy benefit manager to obtain approval for Fuller's prescription, saying she was calling from a doctor's office and that the drug was to treat cancer pain.

"Their attempts to manipulate the prescription approval process for this drug appear to have been systemic, and anyone responsible for this manipulation deserves to be prosecuted," McCaskill said.

Insys in a statement said it disagreed with "certain characterizations" in McCaskill's report but agreed the "opioid epidemic must be addressed."

In a Sept. 1 letter accompanying McCaskill's report, Insys CEO Saeed Motahari said the company's former employees' "mistakes and unacceptable actions" were not indicative of those currently working for Insys.

"Over the past several years, Insys has actively taken the appropriate steps to place ethical standards of conduct and patient interests at the heart of our business decisions," he said.

(Reporting by Nate Raymond in Boston; additional reporting by Yashaswini Swamynathan; Editing by Leslie Adler and Andrew Hay)