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Insys records $4.5M charge in Q2 relating to Illinois opioid lawsuit


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Insys records $4.5M charge in Q2 relating to Illinois opioid lawsuit

Insys Therapeutics Inc. took a $4.5 million charge in the second quarter related to a litigation award and government settlements and representing an estimated potential settlement with the state of Illinois.

The company is taking the charge to resolve a lawsuit filed in August 2016 by Lisa Madigan, the attorney general of Illinois, Reuters reported Aug. 3.

According to the news outlet, the lawsuit accuses the company of deceptive marketing practices in the promotion of its opioid painkiller Subsys, a fentanyl-based cancer pain drug, for off-label usage.

Insys is also under investigation by the U.S. Justice Department relating to several former executives allegedly bribing doctors to prescribe Subsys.

Former Insys CEO Michael Babich, along with former vice presidents Alec Burlakoff and Michael Gurry, former national sales director Richard Simon, and former regional sales directors Sunrise Lee and Joseph Rowan have pleaded not guilty after being charged by federal prosecutors in December 2016 for bribing doctors to prescribe Subsys and defrauding healthcare insurers.

In January, Insys reached a $2.9 million settlement with New Hampshire for using "unfair and deceptive marketing practices" in promoting the drug. The company is also facing a lawsuit from Anthem Inc., with the health insurer alleging that Insys engaged in fraudulent schemes to secure reimbursements for the opioid painkiller.

Insys has made it a top priority to resolve the investigations relating to the company, Reuters reported, citing comments made by Insys CEO Saeed Motahari on an earnings call.