Insurance Company Wades Into the Fray, Suing a Drug Manufacturer Over Opioid Reimbursements | Levin Papantonio - Personal Injury Lawyers

Insurance Company Wades Into the Fray, Suing a Drug Manufacturer Over Opioid Reimbursements

Last week, Anthem Blue Cross Life & Health Insurance Company filed a lawsuit against Insys Therapeutics Inc. over what the plaintiff's counsel describes as a “creative, fraudulent and illegal” scheme in which the drug manufacturer obtained millions of dollars in improper reimbursements for the opioid prescription medication, Subsys. This comes in the wake of action by the U.S. Department of Justice targeting a number of sales representatives and company officers for kickback and bribery.

Subsys, a sub-lingual pain medication, contains fentanyl, one of the most powerful opioid medications on the market – as well as the most addictive. It was originally approved by the FDA in 2012 for the treatment of pain in cancer patients. However, according to the complaint, Insys executives had decided that promoting Subsys for off-label purposes would increase profits more quickly. Toward that end, the company developed a two-part strategy that would maximize revenues.

The first step involved bribing physicians to write prescriptions for Subsys in the form of “speaking fees.” These doctors made presentations at upscale restaurants, ostensibly to educate colleagues. The “events” were in fact little more than elaborate sales pitches, often made to people who had no authorization to prescribe the drug. The second step involved the creation of an in-house reimbursement team. According to attorneys for Anthem, this “team” submitted “decidedly false and misleading” information in order to obtain reimbursement from insurers.

Over the past several years, Insys' scheme netted approximately $19 million worth of reimbursements. Anthem is suing for actual and punitive damages.

It gets worse for Insys: some of the doctors who were paid “speaker's fees” had suspended licenses or were facing imprisonment for over-prescribing the medication. One of the top prescribers was Dr. Gavin Awerbuch, a neurologist from Saginaw, Michigan. From 2013 to 2015, Dr. Awerbuch received nearly $90,000 in payments from Insys.

An examination of his record on ProPublica reveals that over 70% of his patients were given at least one prescription for opioid medication – more than seven times the average number. He also wrote twice as many prescriptions (including refills) as the typical doctor. Then, in 2016, Insys ceased his payments – because last November, Dr. Awerbuch (who spent over $9 million on collectibles such as baseball cards and rare coins) pleaded guilty to defrauding the Medicare program to the tune of $1.9 million.

Dr. Awerbuch is only one of a motley crew that aided and abetted Insys in its ongoing scheme to defraud insurers. Another accomplice, Dr. Mahmood Ahmad of Anchorage, Alaska, was paid nearly $156,000 over a two year period before having his medical license revoked for operating a “pill mill.” Two more doctors were indicted in Alabama in 2015 on similar charges – and both had been on the Insys “payroll.”

Insys behavior highlights not only how the pharmaceutical industry has contributed to the nation's opioid addiction crisis, it also illustrates one of the reasons why the U.S. health care system is the most expensive, yet inefficient system in the world. While this lawsuit and ongoing criminal investigations may hold Insys accountable and serve as a warning to other pharmaceutical companies, it will not address the fundamental problem – which is the profit motive in health care.

Until the U.S. joins the rest of the world by taking profit out of the equation, expect to see more corporate corruption, more lawsuits and more lives destroyed by addiction to prescription drugs.