Drug Company Founder Convicted of Bribing Doctors with Money, Strippers to Sell More Fentanyl

Corruption is Everywhere - Certainly in Big Pharma

Case exposed kick-backs in the millions, lap dances as incentives

The Associated Press 

Insys Therapeutics founder John Kapoor leaves federal court in Boston in January. Kapoor was found guilty

Thursday in a scheme to bribe doctors to boost sales of a highly addictive fentanyl spray meant for cancer

patients with severe pain. (Steven Senne/Associated Press)

A pharmaceutical company founder accused of paying doctors millions of dollars in bribes to prescribe a highly addictive fentanyl spray was convicted Thursday in a case that exposed such marketing tactics as using a stripper-turned-sales-rep to give a physician a lap dance.

John Kapoor, the 76-year-old former chairman of Insys Therapeutics, was found guilty of racketeering conspiracy after 15 days of jury deliberations. Four former employees of the Arizona-based company, including the former exotic dancer, were also convicted.

Some of the most sensational evidence in the months-long federal trial included a video of employees dancing and rapping around an executive dressed as a giant bottle of the powerful spray Subsys, and testimony about how the company made a habit of hiring attractive women as sales representatives.

Federal prosecutors portrayed the case as part of the government's effort to go after those it views as responsible for fuelling the nation's deadly opioid crisis.

"This is a landmark prosecution that vindicated the public's interest in staunching the flow of opioids into our homes and streets," Massachusetts U.S. Attorney Andrew Lelling said in a statement.

The convictions could embolden federal authorities to bring more cases against top executives of opioid manufactures, said Andrew Kolodny, co-director of opioid policy research at Brandeis University's Heller School for Social Policy and Management.

One of Kapoor's lawyers, Brian T. Kelly. Kapoor's defence team say they will continue to fight to clear their client's name.

(Ross D. Franklin/Associated Press)

"Paying a fine or even civil litigation is inadequate if we want to deter corporations from killing people in their pursuit of profit," Kolodny said.

Opioid overdoses claimed nearly 400,000 lives in the U.S. between 1999 and 2017, according to the Centers for Disease Control and Prevention. An estimated 2 million people are addicted to the drugs, which include both prescription painkillers such as OxyContin and illegal drugs such as heroin.

The Public Health Agency of Canada says there were more than 10,300 deaths in Canada from apparent opioid-related overdose between January 2016 and September 2018. 

Packets of fentanyl mostly in powder form and methamphetamine. (U.S. Customs and Border Protection/Reuters)

Kapoor and the others were accused of scheming to bribe doctors across the U.S. to boost sales of Subsys and misleading insurers to get payment approved for the drug, which is meant for cancer patients in severe pain and can cost as much as $19,000 US a month, according to prosecutors. The bribes were paid in the form of fees for sham speaking engagements that were billed as educational opportunities for other doctors.

The charges carry up to 20 years in prison.

"We will continue the fight to clear Dr. Kapoor's name," defence attorney Beth Wilkinson said in a statement. She said the long deliberations prove it was "far from an open-and-shut case."

A former sales representative testified that regional sales manager Sunrise Lee once gave a lap dance at a Chicago nightclub to a doctor whom Insys was pushing to write more prescriptions. Lee's lawyer said she will challenge the verdict.

Jurors also watched the rap video, which was shown at a national meeting in 2015 to motivate sales reps to push doctors to prescribe higher doses of the drug. At the end of the video, the person dressed up as the bottle takes off his costume and is revealed to be then-vice president of sales, Alec Burlakoff.

Burlakoff pleaded guilty and testified against Kapoor. Burlakoff told the jury that he met Lee at the strip club where she worked and recruited her to join the company despite her lack of pharmaceutical industry experience because he believed she would be willing to help carry out the plan to pay off doctors.

A former CEO of the company, Michael Babich, also pleaded guilty and testified against his colleagues. He said Insys recruited sales reps who were "easy on the eyes" because doctors didn't want an "unattractive person to walk in their door."

Fake oxycodone pills seized by the Manitoba RCMP in February containing fentanyl. (Manitoba RCMP/Twitter)

Kapoor's attorney sought to shift the blame onto Burlakoff, who she said was cutting side deals with doctors. Wilkinson argued that Burlakoff and Babich were lying about Kapoor in an attempt to save themselves.

Kapoor's lawyers also argued that prosecutors were unfairly blaming Insys for fuelling the drug crisis, noting that the drug makes up a tiny fraction of the prescription opioid market.

Several doctors have been convicted in other cases of participating in a kickback scheme. A number of states have sued the Insys, which also agreed last year to pay $150 million US to settle a federal investigation into inappropriate sales.

Insys said in an emailed statement that the "the actions of a select few former employees" are not indicative of the company's work today.

Rare Video of Aftermath Greatest Man-Made Explosion in Its Time

Rare video of Halifax harbour explosion depicts fiery aftermath of 1917 blast

    The equivalent of 5,000 tonnes of TNT sent shockwaves through Halifax in a historic explosion
    99 years ago in Canada. CTV's Bruce Frisko reports.  3:40

CTVNews.ca Staff 

The Halifax harbour explosion of 1917 remains one of the most devastating disasters in Canadian history. Nearly 2,000 people died when a ship loaded with explosives bumped into another vessel and detonated.

Actually, after the collision the ship caught on fire and rather than put out the fire or scuttle the ship, the French crew abandoned it. The ship slowly drifted across the harbour to the Halifax docks before it suddenly exploded flattening half of the city. 

See below for more history...

Ninety-nine years later, rare archival video of the day is being publicly displayed at the Army Museum Halifax Citadel.

The black-and-white images are some of the only moving depictions of Halifax in the hours after the blast. Fires can be seen burning across town, windows are blown out and countless buildings are reduced to rubble. The scenes were shot by W. G. MacLaughlan, a photographer who had a studio in town.

“At the time, the population was a little more than 50,000 people, so half of this city was directly and devastatingly affected by the explosion,” Ken Hynes, a curator at the museum, told CTV Atlantic.

A view of the pyrocumulus cloud

The explosion unfolded on Dec. 6, 1917 when a French ship filled with explosives equivalent to 5,000 tons of TNT accidentally hit a ship from Norway in the waters off Halifax. The collision sparked a massive shockwave that rocked Halifax, levelled entire neighbourhoods and altered the course of Atlantic Canadian history.

Nearly a century later, historians are still learning more about the catastrophe. A researcher who extrapolated figures from the explosion says modern-day Halifax would be hit even harder by the blast.

“If the Halifax explosion were to occur today, we would immediately have 9,600 dead, over 43,000 wounded and 120,000 without adequate shelter,” said historian and author John Boileau.

Historians have spent decades poring over materials from the days after the blast in an effort to learn more about how the community responded to the crisis.

“It can be as little as somebody writing a postcard or a letter saying, ‘I was in Halifax and I saw the devastation,’” said historian Blair Beed.

For documentary filmmaker John Versteege, the harbour explosion was so fascinating that he compiled hours of never-before-seen footage and interviews with survivors to piece together what happened. He produced the film in “Thunder in the Sky,” a 97-minute documentary released in 1993 on the 75th anniversary of the disaster.

“Big pictures are made out of millions of small events,” Versteege said.

The priceless moving pictures are among a trove of other artifacts on display at the Halifax museum, including a watchman’s clock recovered from beneath a dock in the harbour. Its face is permanently frozen at 9:04 a.m. -- the same minute the explosives went off.

   Looking north from a grain elevator towards Acadia Sugar Refinery, circa 1900, showing the
   area later devastated by the 1917 explosion

The Halifax Explosion

The Halifax Explosion was a maritime disaster in Halifax, Nova Scotia, Canada, on the morning of 6 December 1917. SS Mont-Blanc, a French cargo ship laden with high explosives, collided with the Norwegian vessel SS Imo in the Narrows, a strait connecting the upper Halifax Harbour to Bedford Basin. A fire on board the French ship ignited her cargo, causing a large explosion that devastated the Richmond district of Halifax. Approximately 2,000 people were killed by blast, debris, fires and collapsed buildings, and an estimated 9,000 others were injured.

Mont-Blanc was under orders from the French government to carry her cargo of high explosives from New York via Halifax to Bordeaux, France. At roughly 8:45 am, she collided at low speed – approximately one knot (1 to 1.5 miles per hour or 1.6 to 2.4 kilometres per hour) – with the unladen Imo, chartered by the Commission for Relief in Belgium to pick up a cargo of relief supplies in New York. The resulting fire aboard the French ship quickly grew out of control. Approximately 20 minutes later at 9:04:35 am, Mont-Blanc exploded. The blast was the largest man-made explosion prior to the development of nuclear weapons, releasing the equivalent energy of roughly 2.9 kilotons of TNT.

    Map of present-day Halifax and Dartmouth. Bedford Basin is top left and the Narrows between
    Dartmouth and Halifax leads towards the Atlantic off the bottom on the right.

Nearly all structures within an 800-metre (2,600 ft) radius, including the entire community of Richmond, were obliterated. A pressure wave snapped trees, bent iron rails, demolished buildings, grounded vessels, and scattered fragments of Mont-Blanc for kilometres. Hardly a window in the city proper survived the blast. Across the harbour, in Dartmouth, there was also widespread damage. A tsunami created by the blast wiped out the community of Mi'kmaq First Nations people who had lived in the Tuft's Cove area for generations.

Thousands of people were injured because they were standing at their windows watching the burning ship when it exploded. Most of the injuries were shards of glass in people eyes. When I was growing up in Nova Scotia I knew people who were blind, or blind in one eye because of the explosion. And as if the explosion wasn't enough a blizzard struck Nova Scotia that night and temperatures dropped well below freezing for the next several days.

Relief efforts began almost immediately, and hospitals quickly became full. Rescue trains began arriving from across eastern Canada and the north-eastern United States, but were impeded by a blizzard. Construction of temporary shelters to house the many people left homeless began soon after the disaster. The initial judicial inquiry found Mont-Blanc to have been responsible for the disaster, but a later appeal determined that both vessels were to blame. There are several memorials to the victims of the explosion in the North End.

99 years later Nova Scotia still sends a huge Christmas Tree to Boston every year in appreciation for the extraordinarily benevolent response from Bostonians.

    Halifax Regional District, Nova Scotia

Boston Terror Suspect Wanted to Behead Pamela Geller

(CNN)Usaamah Rahim, who was fatally shot after waving a military knife at law enforcement officers in Boston, was originally plotting to behead Pamela Geller, an activist and conservative blogger, law enforcement sources told CNN on Wednesday.

But Rahim, a 26-year-old security guard who officials believe was radicalized by ISIS and other extremists, decided instead to target the "boys in blue," a reference to police, according to court documents.

"I can't wait that long," he said of the original beheading plan, according to an FBI affidavit filed in federal court in Boston.

Geller drew national attention last month after an off-duty police officer working security thwarted an attack at her organization's contest for Prophet Mohammed drawings in Garland, Texas. She's president of the American Freedom Defense Initiative, which includes subsidiary programs Stop Islamization of America and Stop Islamization of Nations.

"They targeted me for violating Sharia blasphemy laws. They mean to kill everyone who doesn't do their bidding and abide by their law voluntarily," Geller told CNN's Erin Burnett after learning of the alleged plot.

"This is a showdown for American freedom. Will we stand against this savagery or bow down to them and silence ourselves?"

Pamela Geller

Geller said that she's had an "army of security" since last month's Texas incident.

"This is what is required just to show a cartoon in America, 2015," she said. "It's striking. It's devastating, and people need to understand what's at stake. I mean, if we surrender on this point, what will we surrender next?"

You may not agree with Pamela Geller's provoking radical Islam, but she has quite successfully shown us a glimpse of the future of Islamcized America.


'The easiest target'
About two hours before Rahim's confrontation Tuesday with officers on a Boston street, he allegedly told an associate he was "going to ... go after them, those boys in blue. 'Cause ... it's the easiest target," the documents say.

Rahim's alleged associate, David Wright, 25, appeared in U.S. District Court in Boston to face a charge of obstructing a federal investigation by destroying electronic evidence on Rahim's smartphone. A detention hearing was scheduled for June 19 after prosecutors said he was a flight risk.

Wright allegedly attempted to destroy Rahim's cell phone and conceal evidence of their plans, according to the documents. Wright faces a maximum penalty of five years in prison if convicted.

Rahim purchased three military fighting knives with blades longer than 8 inches on Amazon.com, the court documents said.

Police released this image of a knife Usaama Rahim
allegedly waved at officers before being fatally shot.

"I just got myself a nice little tool," Rahim allegedly told his associate, according to the court documents. "You know it's good for carving wood and ... carving sculptures."

In a recorded conversation, the two men are then heard laughing. They apparently share some history.

Under the alias "Abu Sufyaan," Rahim thanked his nephew, "Dawud Sharif Abdul-Khaliq," an alias of Wright, for witnessing his wedding, according to a 2013 Facebook post.

Wright's attorney called for caution.

"I would urge the government, the FBI and law enforcement, in investigating this case and related cases, to be as transparent as possible, and in enforcing the law, to abide by the law," Jessica Hedges told reporters. "We have serious concerns about that already."

24-hour surveillance
Boston Police Commissioner William Evans said surveillance video shows four or five officers approach Rahim without their weapons drawn. The officers backtrack as he comes after them and gets "close enough to cause imminent harm." They eventually draw their weapons and open fire.

"We never anticipated what his reaction would be and that he would pull out ... a military knife and approach the officers," Evans said.

Anti-terrorism authorities had Rahim under 24-hour surveillance, said Vincent B. Lisi, FBI special agent in charge.

Rahim was a subject of a terror investigation involving suspected Islamist extremists, law enforcement sources said.

"We believe he was a threat," Evans said. "He was someone we were watching for quite some time."

The FBI noted a recent change in Rahim's behavior, including social media threats against police, which prompted agents to try to approach him, according to an official.

Shooting video
Authorities showed the surveillance video of the incident during an unusual meeting with religious and civil rights leaders in an attempt to allay community concerns about the shooting.

Rahim was not on the phone at the time of the shooting and was not shot in the back, as had been reported by a relative, according to clergy and civic leaders who met with authorities earlier Wednesday.

"What the video does reveal to us very clearly is that the individual was not on the cell phone, the individual was not shot in the back and that the information reported by others that that was the case was inaccurate," Darnell Williams, president and chief executive of the Urban League of Eastern Massachusetts, said at a news conference with the police commissioner and others.

Rahim's brother has posted on social media that the suspect was on the phone with their father and was shot three times in the back during the confrontation with police.

Williams said prosecutors want Rahim's family to see the video before showing it to the public.

The religious and civic leaders said Rahim appeared to be shot three times -- in the shoulder, abdomen and chest. Police had earlier reported that he was struck two times.

Imam Abdullah Faaruuq, speaking for the Muslim community, said the video was inconclusive.

"I don't think that he was shot in the back. ... However we couldn't see clearly at all," he said.

He added, "We can't say what happened. We weren't there. We do see a very vague video that is not clear as to what transpired. It wasn't at a bus stop. He wasn't shot in the back and there is not detail enough on the video to tell us exactly what happened."

A third associate
The FBI-led task force had been watching Rahim and two associates also believed to be radicalized, according to a law enforcement official. Rahim had been monitored for at least a couple of years. Investigators were talking to the associates, and various locations in Massachusetts and Rhode Island were being searched, officials said.

The Rhode Island raid was connected to a third person believed to be associated with Wright and Usaamah Rahim, according to two federal law enforcement sources. The third person was connected by more than just an "Internet relationship," one law enforcement source said. The sources did not provide a name for the individual they were investigating.

The FBI is still investigating whether more people are connected with the three.