Kapoor SUBSYS billionaire resigns from Chandler’s Insys Therapeutics board

The company’s medication, Subsys, contains a narcotic that’s 80 times more powerful than morphine.

John Kapoor, the founder and former chairman and CEO of Chandler-based Insys Therapeutics, resigned his board seat over the weekend following his arrest last week on charges that include racketeering, conspiracy to commit mail fraud, conspiracy to commit wire fraud and conspiracy to violate an anti-kickback statute.

Patrick Fourteau, a veteran pharmaceutical company executive, also resigned from Insys’ board after serving six years. The company accepted both resignations.

Separately, Insys announced that it has compiled $150 million in reserves as potential settlement funds for the Department of Justice’s investigation against it.

Kapoor, 74, who had sat on Insys’ board since the company’s formation in 1990, stepped down in January as chairman. He appeared in U.S. District Court in Phoenix on Oct. 26, after having been arrested earlier that day at his Phoenix home.

MORE: Insys founder and billionaire John Kapoor arrested in opioid-marketing case

He was ordered to submit to the attachment of a monitoring device, not leave Maricopa County and surrender his passport as he awaits an arraignment in Boston next month. Six former offIcials of Insys, which has 400 employees, also face charges.

 Kapoor was listed among the seven richest Arizonans by Forbes last year with an estimated net worth at the time of $2.1 billion. He didn’t make this year’s list, which had a cutoff of $2 billion, following a sharp decline in the price of Insys stock, of which he is the majority holder.

The U.S. Attorney’s Office in Massachusetts said Kapoor and the other former company officials conspired to bribe medical practitioners in various states to encourage them to prescribe a powerful narcotic intended to treat pain for cancer patients. In exchange for bribes and kickbacks, the practitioners wrote large numbers of prescriptions for patients, most of whom were not diagnosed with cancer, the government alleges.

MORE: Insys-paid doctor can’t practice amid questions about opioid prescriptions

The indictment also alleges that Kapoor and the six former executives conspired to mislead and defraud health insurers that were reluctant to approve payment for the drug when it was prescribed for non-cancer patients.

Read More: http://www.azcentral.com/story/money/business/health/2017/10/30/arrested-billionaire-john-kapoor-resigns-board-chandler-insys-therapeutics/813447001/