BOSTON May 9 Insys Therapeutics Inc's
chief executive said on Tuesday it was working to resolve a U.S.
Justice Department probe, after prosecutors accused several
former executives of leading a scheme to bribe doctors to
prescribe a fentanyl-based pain medication.
Saeed Motahari, who took over as the Arizona-based
drugmaker's CEO just over three weeks ago, told analysts on an
earnings call that Insys has been working to improve its
compliance practices and was focused on resolving the probe.
"We continue to engage in discussions with the DOJ and
remain highly committed to resolving this matter," Motahari
Motahari's comments came as Insys reported a 40.4 percent
decline in quarterly revenue, which was hurt by a fall in demand
for Subsys, an under-the-tongue spray containing the synthetic
opioid fentanyl that is the subject of the probe.
As U.S. authorities have sought to combat opioid abuse,
Subsys has become the subject of several federal and state
investigations amid allegations that the drug was marketed and
sold to non-cancer patients.
Insys said net revenue totaled $36 million for the first
quarter ending March 31, compared with $60.4 million for the
same period in 2016. The drop came amid a 32 percent decline in
prescriptions for Subsys since the fourth quarter.
Darryl Baker, the company's chief financial officer,
attributed the decline to "ongoing and heightened publicity"
given to the national opioid epidemic, as well as the
investigations related to Subsys.
Federal prosecutors in Boston in December announced charges
against several former Insys executives and managers, including
former CEO Michael Babich, in connection with a scheme to bribe
doctors to prescribe Subsys.
Babich and his five co-defendants have all pleaded not
guilty. Besides that case, federal charges have also been filed
in four states against at least five other ex-Insys employees.
Insys has also faced investigations by several state
attorneys general. In August, Illinois' attorney general sued
Insys, accusing it of deceptively marketing and selling Subsys
to doctors for off-label uses.
That lawsuit followed a $1.1 million settlement with
Oregon's attorney general resolving similar claims in August
2015. More recently, Insys in January agreed to pay $3.4 million
to resolve an investigation by New Hampshire's attorney general.
In announcing earnings on Tuesday, Insys reported a net loss
of $6.5 million or 9 cents per share in the first quarter,
compared with a profit of $2.3 million or 3 cents per share a
(Reporting by Nate Raymond in Boston; Editing by Dan Grebler)