Insys files for bankruptcy after settling opioid case

The opioid maker that hired an ex-stripper to peddle its addictive fentanyl spray has become the first to file for bankruptcy as it faces hundreds of millions in legal costs.

Insys Therapeutics filed for Chapter 11 on Monday, just five days after it agreed to pay $225 million to settle a Justice Department probe into bribes it paid doctors to get them to prescribe its fentanyl spray Subsys.

High-pressured sales tactics included enlisting former stripper Sunrise Lee as a regional sales manager to court crooked doctors with her lap dancing skills, according to court testimony in a case against Insys brought by the Massachusetts Attorney General.

“She was sitting on [the doctor’s] lap, kind of bouncing around, and he had his hands all over her, kind of inappropriately,” Holly Brown, an ex-Insys sales rep who witnessed the romp, testified in January.

Subsys is a spray administered under the tongue said to be more potent than morphine. It received approval from the Food and Drug Administration in 2012 for treating pain in cancer patients.

But the company soon started pressuring doctors to write off-label prescriptions.

Despite Monday’s filing in US Bankruptcy Court in Delaware, Insys says it plans to keep operating while it tries to sell company assets through a court-supervised sale process.

“After conducting a thorough review of available strategic alternatives, we determined that a court-supervised sale process is the best course of action to maximize the value of our assets and address our legacy legal challenges in a fair and transparent manner,” Insys Chief Executive Andrew Long said Monday.

Last month, a Boston federal jury convicted Insys founder John Kapoor and four other former executives and managers for conspiring to bribe doctors to push the spray on patients.

Insys is not the only drugmaker facing legal repercussions for its role in the opioid crisis. OxyContin maker Purdue Pharma said in March that it considered filing for bankruptcy as it faces potentially significant liabilities from roughly 2,000 lawsuits tied to the crisis.

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