Insys founder Kapoor steps down as Akorn chairman after arrest

The billionaire founder of Insys Therapeutics Inc. John Kapoor, exits the federal court house after a bail hearing in Phoenix, Arizona , U.S., October 27, 2017. REUTERS/Conor Ralph

NEW YORK (Reuters) - John Kapoor, the billionaire founder of opioid maker Insys Therapeutics Inc, has resigned as chairman of drugmaker Akorn Inc, just days after his arrest on charges he participated in a scheme to bribe doctors to prescribe a potent pain medication while he was at Insys.

Akorn, in a regulatory filing on Tuesday, said that Kapoor had resigned on Monday as chairman and a director of the company, and said director Alan Weinstein was named to replace him as chairman.

Kapoor, who is Insys’ majority shareholder, was charged last week with engaging in conspiracies to commit racketeering, mail fraud and wire fraud in an indictment filed in federal court in Boston.

Kapoor’s lawyer did not immediately respond to a request for comment. Last week, he said in a statement that Kapoor is innocent and will fight the charges.

Kapoor had stepped down as chief executive of Insys in January.

Insys’ shares slumped to a more than four-year low on Tuesday after resuming trade. The shares had been halted since Thursday, the day Kapoor was arrested. In Tuesday afternoon trading, the shares were down 9.5 percent at $5.19, after earlier falling 28.6 percent to $4.10.

Akorn shares rose 13 cents, or 0.4 percent, to $32.57.

Reporting by Michael Erman; Editing by Leslie Adler