Raycom Media

PART VII – Prescriptions for Profit: Physicians Escape Punishment

Insys Therapeutics has been sued by state and local governments, private insurance companies and patients. Several former company executives have been indicted or convicted for their roles in bribing doctors to prescribe the fentanyl spray, Subsys.

By Jill Riepenhoff and Megan Luther

A drugmaker’s scheme to bolster sales of a potent painkiller with kickbacks to doctors has caused legal problems for the company but has left largely unscathed the physicians who pushed the drug on their patients.

Insys Therapeutics has been sued by state and local governments, private insurance companies and patients. Several former company executives have been indicted or convicted for their roles in bribing doctors to prescribe the fentanyl spray, Subsys.

At least a dozen civil lawsuits accuse individual doctors of accepting kickbacks from Insys to prescribe the drug which is 100 times more potent that morphine.

Those doctors prescribed the drug – intended only for those with cancer pain – to patients with other ailments, leading to harmful addiction and, in some cases, death.

Yet many of the doctors who benefited the most from the Arizona-based drug company’s payouts still practice medicine without consequences, a national Raycom Media investigation found. Insys did not respond to requests for comment.

A Florida doctor was accused in a civil lawsuit of causing the death of a patient suffering from a respiratory disease who shouldn’t have been on Subsys. She died the day after taking her first dose, according to the lawsuit. He still practices medicine.

A South Carolina pain doctor who treated a young mother’s hip pain with Subsys has left the woman mostly toothless and suffering from stroke-like symptoms. He has since moved his practice to New York.

Photos: www.nih.gov, Animation: Raycom Media

Federal agents in the past year have raided the offices of at least three doctors who took Insys payments, court records show. All still have active medical licenses.

And in a civil case unsealed in May, the U.S. government joined a whistleblower lawsuit against Insys that named 20 doctors and other medical professionals who accepted payments from the company. The doctors fraudulently billed Medicare and TriCare as much as $68 million for Subsys for patients who didn’t have cancer, the lawsuit says. Eleven of those doctors still hold their medical licenses, according to Raycom Media’s investigation.

‘When a pain management guy is getting $100,000 to go to these dinners and they’re prescribing this for elbow pain or that hip pain, that’s criminal,” said Randy Hood, a South Carolina lawyer who represents several patients suing doctors who prescribed Subsys.

Speaker fees and other payments to doctors are legal unless they are connected to the volume of drugs physicians prescribe, according to the federal anti-kickback law.

“If you’re paid to prescribe a device or a drug, I think you should be in jail,” said Dr. Charles Rosen, a spine surgeon and executive director of the Association for Medical Ethics in California. “It’s abuse. It’s illegal. It’s a felony.”

Between 2013 and 2016, Insys paid 126 doctors at least $50,000 each in speakers’ fees and for travel, entertainment or consulting, Raycom Media’s analysis of federal physicians’ payments found.

Raycom mailed each of the doctors a letter with their payment and prescription histories and asked them to comment.

The payments to these doctors may not be nefarious. One oncologist, who never prescribed Subsys, said he was paid nearly $114,000 for food, travel and clinical development services.

Collectively, Insys paid the doctors more than $14 million.

As of mid-June, nine of them have been indicted or convicted for pushing Subsys onto patients, including five New York physicians who were charged in March.

On June 28, a federal grand jury indicted Dr. Nilesh Jobalia, 53, who ran pain clinics in southwestern Ohio.

The 114-count indictment accuses him, among other things, of operating a pill mill, causing the death of at least three patients and fraudulently billing more than $2.4 million to Medicare, Medicaid and Ohio’s Worker’s Compensation.

He also is charged with 17 violations of the federal anti-kickback law for his role in Insys’ speakers program, in which he was paid more than $103,000.

Although the Ohio medical board revoked his license last year, the criminal case was initiated by the state pharmacy board.

As of mid-April, nine of them have been indicted or convicted for pushing Subsys onto patients, including five New York physicians who were charged in March.

Some lawyers and medical experts question why there have been so few investigations of the highest paid doctors.

“That’s scary,” said Hood, the South Carolina attorney. “There’s going to be a day of reckoning. It was an insidious plot based on profit over patient safety.”

Snapshot of doctors named by whistleblowers

The U.S. Department of Justice joined a civil lawsuit in which five whistleblowers claim their former employer, Insys Therapeutics, schemed to defraud federal healthcare programs at the expense of patients. The lawsuit names 20 health care providers and accuses them of accepting payments as inducements to prescribe Subsys, a fentanyl spray intended only for cancer patients. Here’s a snapshot of the doctors, rounded amounts billed to the federal prescription benefit programs for the elderly, military members and veterans for Subsys claims and the amount of payments they took from Insys.

Speaking for fees

Subsys was approved by the Food and Drug Administration in 2012 for cancer patients with extreme pain who had built up immunity to less powerful opioids. For those patients, advocates say it’s a blessing because of the instant pain relief it brings.

The restriction limited the pool of patients with cancer to one to two million people, lawsuits say.

To reach a broader pool, Insys devised the scheme to recruit non-cancer doctors into its speaker program and deceive insurance companies about patients’ diagnoses, court records disclose.

Insys employees called the insurance companies for doctors and, in some cases, said the patient had “breakthrough pain,” avoiding use of the word cancer, indictments say. A month’s supply of Subsys costs as much as $35,000.

Medicare and TriCare, the federal prescription drug benefit programs for the elderly and for the military and veterans, expressly prohibited paying for Subsys unless the patient had cancer, according to the whistleblower lawsuit. Yet both programs paid out as much as $68 million in bogus claims from 21 health-care providers.

Doctors are supposed to only prescribe Subsys to patients who have been taking other opioids round-the-clock. But the majority of Insys’ highest paid doctors who prescribed Subsys weren’t prolific prescribers other of opioids.

Only a fifth of those doctors were among the top opioid prescribers in the Medicare Part D drug-benefit plan for the elderly and disabled between 2013 and 2015, federal data shows.

The company created a “speakers’ bureau,” in which doctors would be reimbursed for talking about Subsys with other doctors.

In reality, in some cases it was payments made based on the volume of prescriptions written, according to court records.

Of the highest paid doctors, only 18 were oncologists.

Nearly 60 percent were pain specialists. Eight were general practice doctors such as family physicians or internal medicine specialists. Two were sports medicine doctors.

Patients pay the price

Law enforcement agencies and state medical boards have known for years about the kickback scheme.

In 2014, federal agents indicted a Michigan doctor for accepting bribes from Insys. Gavin Awerbuch later was convicted.

In 2015, the Southern Investigative Reporting Foundation published a series exposing the Insys’ scheme.

In 2016, federal agents charged Insys founder and CEO John Kapoor and other executives with bribing doctors and healthcare fraud.

In a statement, the company said its new management team consists of “responsible and ethical business leaders” committed to effective compliance and that it has ended its speaker program for Subsys.

Widespread prosecutions and state medical board investigations of the highest paid doctors have not followed.

“I’m surprised that when you see some of these top paid doctors, they’re still out there. It’s shocking,” said Richard Hollawell, a New York attorney who represents patients wrongly prescribed Subsys in their civil lawsuits against doctors. “The numbers don’t lie (about) how much they were getting paid. Every one of them should be . . . locked up.”

One woman he represents received Subsys after having a minor surgery. The prescribing doctor, Jeffrey L. Goldstein, was indicted in March and has pleaded not guilty. He did not respond to a request for comment.

“It was the best day I’ve had in a long time,” said Hollawell’s client, Dina DeMarest, a Staten Island, New York, mother.

DeMarest (above) was experiencing pain from a minor surgery, when she took the advice of a family friend to schedule an appointment with Goldstein. The doctor gave her Subsys, though she didn’t have cancer. She said she was also not told about the drug’s restricted use for cancer patients.

The doctor who treated Angela Cantone, a young mother from South Carolina, has not faced any sanctions. In 2011, she was referred to Dr. Aathirayen Thiyagarajah in Greenville to relieve her hip pain caused by a work injury and to help reduce the number of medications she was taking.

In 2013, Thiyagarajah put her on Subsys. By then, he had joined Insys’ speaker’s program, in which he was paid more than $202,000 between 2012 and 2016, federal payments data shows.

Thiyagarajah never told Cantone that Subsys was fentanyl, that the drug was intended only for cancer patients in extreme pain or that it was highly addictive, her lawsuit says.

She learned of the drug’s addictive nature soon after starting it.

“I would be passing out everywhere,” said Cantone, 33, mom to three children – one with a terminal illness and another with special needs. “It destroyed over 2 ½ years of my life that I was on this.”

She couldn’t tell the difference between day and night, once fixing grilled cheese sandwiches for her sleeping children at 3 a.m. Another time her husband found her passed out on the lawn at 2 a.m.

Life became so difficult she needed to hire help to care for her children.

“I was barely able to put clothes on,” she said. “My brain was so scrambled.”

By July 2015, Cantone had learned enough about Subsys that she decided to stop taking it. In return, the doctor refused to treat her any longer.

Thiyagarajah did not respond to requests for comment.

Cantone quit the opioid drug cold turkey and suffered weeks of painful withdrawal.

Today, the after-effects remain. She has only eight teeth left – the others rotted because of Subsys’ potent chemicals. “I had a beautiful smile,” she said. She also still suffers stroke-like episodes where one side of her body will go numb.

She decided to file a lawsuit against the doctor last year.

“I felt like he needed to be stopped,” she said. “I had a strong enough voice to say what you did was wrong.”

Pay to Play?

About 85 percent of all doctors in the U.S. accept payments from pharmaceutical companies, said Dr. Eric G. Campbell, a professor of medicine and director of research at the University of Colorado in Denver. He is a sociologist who has studied the financial relationship between doctors and drugmakers for 20 years.

A good relationship may involve physicians identifying patients for a drugmaker’s clinical trial.

A questionable – or even illegal relationship – involves receiving a payout in exchange for prescribing, he said.

“Data has shown that even a physician receiving something as little as a $10 meal increased the likelihood of them using (prescribing) that product,” he said.

These cozy relationships enrich both drugmakers and doctors while patients may suffer, he said.

At least 10 of the highest paid doctors in Insys’ programs have been accused in civil lawsuits filed by patients or their families.

All but two still hold active licenses to practice medicine.