As the states and nations line up to demand answers and compensation for the opioid crisis, the first opioid manufacturer has declared bankruptcy.
Drugmaker Insys Therapeutics Inc. filed for Chapter 11 bankruptcy protection on Monday, Reuters reports. The filing comes a month after a jury found the company’s founder, John Kapoor, and four other former executives and managers guilty of racketeering, and about a week after Insys agreed to pay $225 million in order to settle with the U.S. Justice Department.
The company was being investigated on grounds that it had bribed doctors and offered kickbacks for prescribing its fentanyl-based medication and committed mail fraud as it paid doctors to push its powerful opioid, allegedly even to patients who didn’t need such a powerful drug to manage their pain. Fentanyl is 80-100 times stronger than morphine.
According to CNBC, Insys reported a loss of $123.8 million in the first quarter, partially due to the decrease in prescriptions for its under-the-tongue fentanyl spray, Subsys. Due to the loss in revenue, as well as the mounting legal settlements it faced after the government demanded Insys be held responsible financially, if not criminally, for its role in the deadly U.S. opioid epidemic, the company filed for bankruptcy.
It’s not a surprise, as declaring bankruptcy is one of the oldest tricks in the corporate playbook. Purdue, the embattled drugmaker behind Oxycontin, is reportedly considering bankruptcy protection, too, as it faces some 2,000 lawsuits over allegations that it contributed to America’s opioid crisis, even after it knew that the drugs were being misused.
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