Af­ter be­ing found guilty of en­gag­ing in a bribery scheme to get doc­tors to pre­scribe its po­tent, ad­dic­tive painkiller and dup­ing in­sur­ers in­to pay­ing for the opi­oid drug by a fed­er­al ju­ry last month, for­mer ex­ec­u­tives of the con­tro­ver­sial In­sys Ther­a­peu­tics are be­ing held ac­count­able. The Phoenix, Ari­zona-based drug­mak­er $IN­SY has agreed to pay $225 mil­lion to set­tle the gov­ern­ment’s sep­a­rate crim­i­nal and civ­il in­ves­ti­ga­tions, the De­part­ment of Jus­tice (DoJ) said on Wednes­day.

The two in­ves­ti­ga­tions are fo­cused on the com­pa­ny’s fen­tanyl spray Sub­sys that was ap­proved in 2012 by the FDA for break­through can­cer pain. Fen­tanyl is a man-made opi­oid 50 times more po­tent than hero­in and 100 times more po­tent than mor­phine, ac­cord­ing to the CDC. Pros­e­cu­tors charged In­sys with in­flat­ing Sub­sys sales by brib­ing doc­tors to pre­scribe the drug to pa­tients with­out can­cer — in an elab­o­rate scheme that in­clud­ed win­ing and din­ing them, pay­ing them to speak at “ed­u­ca­tion­al events” and in one case even a lap dance — fu­el­ing the rag­ing opi­oid cri­sis that kills 130 Amer­i­cans every day.

John Kapoor In­sys

Ju­rors from the tri­al who found In­sys founder John Kapoor and and four of his high rank­ing col­leagues (that are no longer work­ing with In­sys) guilty, were al­so giv­en a front-row seat to the crass video de­signed to train the com­pa­ny’s sales reps, in which two im­pec­ca­bly suit­ed men — os­ten­si­bly In­sys em­ploy­ees — ‘rap’ In­sys’ sin­is­ter strat­e­gy re­plete with rapid hand ges­tures: “I love titra­tions. Yeah, that’s not a prob­lem. I got new pa­tients, and I got a lot of ‘em…If you want to be great, lis­ten to my voice. You can be great — but it’s your choice.”

Al­to­geth­er, eight In­sys ex­ec­u­tives have now been con­vict­ed by the U.S. At­tor­ney’s Of­fice in Mass­a­chu­setts for crimes re­lat­ing to the il­le­gal mar­ket­ing of Sub­sys, the DoJ said.

As part of the crim­i­nal res­o­lu­tion, In­sys will en­ter in­to a de­ferred pros­e­cu­tion agree­ment with the gov­ern­ment, its op­er­at­ing sub­sidiary will plead guilty to five counts of mail fraud, and the com­pa­ny will pay a $2 mil­lion fine and $28 mil­lion in for­fei­ture. The crim­i­nal con­vic­tion is his­toric as it takes aim at the pow­er­ful mas­ter­minds be­hind a mar­ket­ing ploy de­signed to put prof­it ahead of pa­tients — in­stead of mere fines, or let­ting pow­er­ful ex­ec­u­tives make sac­ri­fi­cial lambs of their lieu­tenants.

Un­der the civ­il res­o­lu­tion, In­sys agreed to pay $195 mil­lion to set­tle al­le­ga­tions that it vi­o­lat­ed the False Claims Act.

“To­day’s set­tle­ment sends a strong mes­sage to phar­ma­ceu­ti­cal man­u­fac­tur­ers that the kinds of il­le­gal con­duct that we have al­leged in this case will not be tol­er­at­ed,” said As­sis­tant At­tor­ney Gen­er­al Jody Hunt of the DoJ’s civ­il di­vi­sion, in a state­ment.

Jody Hunt DoJ

The set­tle­ment is not cheap for the al­ready fi­nan­cial­ly strained In­sys. Last month, the com­pa­ny in­di­cat­ed it was fac­ing a liq­uid­i­ty cri­sis, which could com­pel it in­to fil­ing for bank­rupt­cy pro­tec­tion.

The com­pa­ny’s le­gal ex­pens­es jumped about 150% to $25.7 mil­lion in the first-quar­ter of 2019, ver­sus the same quar­ter last year. In April, In­sys’ au­di­tor raised doubts on the drug­mak­er’s abil­i­ty to con­tin­ue as a go­ing con­cern.

As of March 31, the com­pa­ny had $87.6 mil­lion in cash and cash equiv­a­lents and in­vest­ments — as well as ac­crued li­a­bil­i­ties of rough­ly $240.3 mil­lion in pro­posed set­tle­ments of var­i­ous lit­i­ga­tion mat­ters, In­sys said, adding it ex­pects to have con­tin­ued neg­a­tive cash flows from op­er­at­ing ac­tiv­i­ties.

In­sys is hard­ly the on­ly opi­oid drug mak­er in fi­nan­cial trou­ble. Pur­due Phar­ma — the mak­er of one of the most wide­ly abused pre­scrip­tion opi­oid painkiller Oxy­con­tin — is re­port­ed­ly con­sid­er­ing bank­rupt­cy. Mean­while, oth­er drug man­u­fac­tur­ers, dis­trib­u­tors and phar­ma­cies are al­so fac­ing hun­dreds of civ­il law­suits for their role in prop­a­gat­ing the opi­oid cri­sis.

Im­age: Kristof­fer Trip­plaar for SIPA AP