April 23, 2018 / 9:21 PM / a year ago

Ex-Insys employee in U.S. opioid case sentenced to home confinement

(Reuters) - A former Insys Therapeutics Inc sales representative was sentenced on Monday to six months of home confinement after admitting that she participated in a scheme to pay kickbacks to two Alabama doctors to prescribe a fentanyl-based medication.

A box of the Fentanyl-based drug Subsys, made by Insys Therapeutics Inc, is seen in an undated photograph provided by the U.S. Attorney's Office for the Southern District of Alabama. U.S. Attorney's Office for the Southern District of Alabama/Handout via REUTERS

Natalie Perhacs, 32, was sentenced by U.S. District Judge Callie Granade in Mobile, Alabama, after pleading guilty to conspiring to pay kickbacks to the doctors to prescribe Insys’ product Subsys, according to court records.

The home confinement is part of a five-year period of probation imposed by Granade, who also ordered Perhacs to participate in 300 hours of community service. Her lawyer did not respond to a request for comment.

Perhacs is one of at least 14 former Insys employees or executives to face charges related to what prosecutors say was a scheme to pay kickbacks to medical practitioners who prescribed Subsys and to defraud insurers into paying for it.

Among those charged were billionaire Insys founder John Kapoor, who has pleaded not guilty to racketeering conspiracy and other charges.

Insys has said it has taken steps to prevent past mistakes from happening again. It has said it may need to pay at least $150 million to resolve the U.S. Justice Department’s probe.

Subsys is an under-the-tongue spray containing fentanyl, a synthetic opioid 50 times as potent as heroin. The U.S. Food and Drug Administration has approved Subsys only for treating pain in cancer patients.

Prosecutors say executives and employees at Chandler, Arizona-based Insys used sham speaker programs ostensibly meant to educate healthcare professionals about Subsys to funnel kickbacks to medical practitioners.

Perhacs, who pleaded guilty in 2016 to conspiring to violate the federal Anti-Kickback Statute, testified at trial against the two Alabama doctors, Xiulu Ruan and John Couch.

Prosecutors said the two regularly wrote prescriptions for large quantities of addictive medications including fentanyl without a legitimate medical purpose and regularly prescribed Subsys for off-label purposes to non-cancer patients.

Prosecutors said Insys paid hundreds of thousands of dollars in speaker fees to Couch and Ruan, who for a time was the top prescriber of Subsys nationally.

Prosecutors said Perhacs after being hired by Insys in 2013 as a sales representative was tasked with increasing the volume of Subsys that Ruan and Couch prescribed and setting up paid speaker programs for the two doctors.

Ruan and Couch were convicted of racketeering conspiracy and other felonies and were sentenced in May 2017 to prison terms of 21 years and 20 years, respectively.

Reporting by Nate Raymond in Boston; Editing by Matthew Lewis

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