Phone call exposes Valley drug company's fraudulent scheme to boost painkiller profits

Posted at 11:34 AM, Sep 08, 2017

An investigation led by a U.S. senator is further exposing an elaborate and fraudulent scheme carried out by a Chandler pharmaceutical company to boost its profits.

The office of Sen. Claire McCaskill released a report titled “Fueling an Epidemic” on Wednesday, and it focuses on the actions of Insys Therapeutics to illegally push a powerful painkiller on the market.

“There is extensive evidence that Insys aggressively pressured its employees and the entire medical system to increase the use of a fentanyl product during a national epidemic that was taking the lives of tens of thousands of Americans a year in order to make more money—it’s hard to imagine anything more despicable,” said McCaskill in a prepared statement.

The product at issue is called Subsys, a spray form of the potent opioid that’s only FDA approved for use by cancer patients.

Since that’s a limited market and insurance companies won’t pay for the drug outside of the FDA’s approval, officials said Insys defrauded insurance companies by working with doctors to submit falsified patient records to say the patients had cancer when they didn’t.

In McCaskill’s investigation, it includes an audio recording from a phone call between an Insys employee and an insurance company that reveals how the fraud scheme was carried out.

“This recording suggests the Insys employee in question repeatedly misled Envision Pharmaceutical Services to obtain approval for Ms. Fuller’s Subsys treatment—heavily implying she was employed by the prescribing physician and misrepresenting the type of pain the patient was experiencing,” according to the Senator’s office.

None of the information contained in the new report surprises former Insys employee Patty Nixon, who worked at the company in 2013 and 2014.

She said the recording shows the company’s past standard operating procedure and that it almost always worked.

“There were some insurance companies that started to catch on,” Nixon said. “They would put us on hold because they were suspicious and they would call the actual doctor’s office… They would get back on the line with me and say, ‘I just called the doctor’s office, and they say there’s no Patty that works there.’ And I’m like ‘eek!’”

But Nixon said the solution was simple.

“These insurance companies have hundreds and hundreds of phone reps,” she said. “So you just hang up and call back to see if you could get an easier one.”

So far, seven Insys executives are facing federal criminal charges that include racketeering and conspiracy charges.

At least one as already pleaded guilty – Elizabeth Gurrieri.

Last week, the Arizona Attorney General’s Office filed a consumer fraud lawsuit against Insys.

The lawsuit makes Arizona the latest state attorney general’s office to bring a case against Insys, company executives and affiliated doctors.

“We need to put a stop to the unethical and greedy behavior in the pharmaceutical industry that is fueling the opioid crisis in our state,” said Attorney General Mark Brnovich in a written statement.

In a lengthy written statement posted on its website, Insys officials don’t dispute many of the allegations against the company.

“The allegations contained in the Arizona Attorney General’s complaint relate to former employees and physicians that are no longer associated with our Company or our speaker bureau,” according to the statement.

Contact ABC15 Investigator Dave Biscobing at