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.

Felicity Huffman, Lori Loughlin Among Dozens Charged in U.S. College Admissions Scam

Corruption is Everywhere - Even in America's Best University Admissions

Federal prosecutors charged William Singer with running racketeering scheme

Thomson Reuters ·

Federal prosecutors in Boston have charged William Singer with running the $25-million US racketeering scheme,

which served a roster of clients, including Hollywood actors such as Felicity Huffman.

(Peter Kramer/Getty Images) I'm guessing this photo was taken before #MeToo

Hollywood actors Felicity Huffman (Desperate Housewives) and Lori Loughlin (Full House/Fuller House) were among 50 people charged by U.S. federal prosecutors on Tuesday in a $25-million US scheme to help wealthy Americans cheat their children's way into elite universities such as Yale and Stanford.

Federal prosecutors in Boston charged William (Rick) Singer, 58, with running the racketeering scheme through his Edge College & Career Network, which served a roster of clients, including CEOs and Hollywood actors.

Prosecutors said Singer's operation arranged for fake testers to take college admissions exams in place of his clients' children, and also bribed coaches to give admissions slots meant to be reserved for recruited athletes, even if the applicants had no athletic ability.

Parents paid tens of thousands of dollars for Singer's services, which were masked as charitable contributions, prosecutors said.

Philanthropist David Sidoo accused of paying $200K to help sons pass U.S. college entrance exams

Singer is scheduled to plead guilty on Tuesday in Boston federal court to charges, including racketeering, money laundering and obstruction of justice, according to court papers. He could not be reached for immediate comment.

Thirty-three parents, including actor Lori Loughlin, were charged, as well as 13 coaches and associates of Singer's business. (Danny Moloshok/Reuters)

Some 33 parents, including Huffman and Loughlin, were charged, as well as 13 coaches and associates of Singer's business. Huffman and Loughlin were not immediately available for comment.

On a call with one parent, prosecutors said Singer summed up his business thusly: "What we do is help the wealthiest families in the U.S. get their kids into school … my families want a guarantee."

The scheme began in 2011, prosecutors said, and also helped children get into the University of Texas, Georgetown University, the University of Southern California and the University of California, Los Angeles.

Part of the scheme involved advising parents to pretend to test administrators that their child had learning disabilities that allowed them extended time to take the exam.

The parents were then advised to choose one of two test centres that Singer's company said it had control over: one in Houston and the other in West Hollywood, Calif.

The test administrators in those centres took bribes to allow Singer's clients to cheat, often by arranging to have a student's wrong answers corrected after completing the exam, or having another person take the exam.

In many cases, the students were not aware that their parents had arranged for the cheating, prosecutors said.

Some of them are now!

John Vandemoor, a former Stanford sailing coach, is also scheduled to plead guilty to racketeering conspiracy charges.

Big Pharma Exec Gave Doctor Lap Dance While Pushing Addictive Painkiller

Corruption is Everywhere - certainly in Big Pharma

Big Pharma - the cause of America's opioid epidemic?

Sunrise Lee exits the federal courthouse in Boston, Massachusetts. © Reuters/Nate Raymond

A former stripper who rose up the ranks to become a sales director at Insys Therapeutics gave a doctor a lap dance as she utilized all her assets to get him to prescribe a dangerous opioid, a court has heard.

In the seedy world of pharmaceutical sales sometimes you just gotta be willing to go the extra mile for clients. In a classic example of the hard-sell, ex-stripper Sunrise Lee once gave a lap dance to a doctor the company was pressuring to get his patients on its addictive fentanyl spray, Subsys, a former Insys employee has testified in federal court in Boston.

Jurors heard the salacious testimony in the first criminal trial of painkiller manufacturer executives over conduct that authorities say contributed to a US opioid abuse epidemic that has killed tens of thousands of people a year, Reuters reports.

Former Insys sales representative Holly Brown said the racy dance took place after Insys began rewarding the doctor for prescribing its painkillers by paying him to speak at sham events that were billed as opportunities for other physicians to learn about the drug.

In reality the speaking events were actually just social gatherings for doctors and their friends, prosecutors say.

The doctor, Paul Madison, is just one of many whom Lee and four colleagues, including wealthy Insys founder John Kapoor, conspired to bribe to boost sales of Subsys, prosecutors allege. They say the former exotic dancer was hired as a “closer” with doctors targeted by the drug’s marketing program.

John Kapoor, the billionaire founder of Insys Therapeutics Inc, arrives at the federal courthouse.

© Reuters/Brian Snyder

“The idea was these weren’t really meant to be educational programs but were meant to be rewards to physicians,” Brown said.

Describing the after dinner activities at one event in 2012, Brown said she, Lee and Madison went to a club, where she witnessed Lee “sitting on his lap, kind of bouncing around.”

“He had his hands sort of inappropriately all over her chest,” she said. During cross-examination by Lee’s attorney, Brown agreed that Madison “appeared to be taking advantage of Ms Lee”.

She also told the court that at the time, Madison ran a “notorious” medical practice. In a 2012 email shown to jurors she described it as a “shady pill mill.” Prosecutors say Insys paid Madison at least $70,800 in speaker fees.

The US Food and Drug Administration has only approved Subsys for treating cancer pain. Prosecutors allege doctors paid by Insys often prescribed Subsys to patients without cancer. The defendants have all pleaded not guilty to racketeering conspiracy.

Ex-South Africa President Faces 16 Counts of Corruption

Corruption is Everywhere - No surprise in South Africa

By Sara Shayanian 

Former South African President Jacob Zuma will face 16 counts of corruption in court, prosecutors said Friday. File photo by Peter Foley/UPI | License Photo

UPI -- Former South African President Jacob Zuma was charged Friday with 16 counts of corruption.

Prosecutor Shaun Abrahams said the former president was charged with fraud, racketeering and money laundering -- and said Zuma's numerous attempts at challenging the charges had failed.

Prosecutors say the charges stem from a $2.5 billion state arms deal and are related to nearly 800 instances of alleged wrongdoing.

"After consideration of the matter, I am of the view that there are reasonable prospects of successful prosecution of Mr. Zuma on the charges listed in the indictment," Abrahams said.

"I am of the view that a trial court would be the most appropriate forum for these issues to be ventilated and to be decided upon."

Zuma, 75, resigned as president last month amid pressure from the African National Congress.

South Africa's leader since 2007, Zuma said he disagreed with the ANC's decision to recall him. Cyril Ramaphosa, the only candidate nominated in South African Parliament, took over as president.

In 2016, Zuma as ordered by South Africa's top court to repay $15 million in public funds he used to upgrade his private home.

Brazil's President Michel Temer Charged with Taking Bribes

Corruption impoverishes the poor and engorges the rich. Brazil normally has a quarter of a million child prostitutes who would starve if they didn't prostitute themselves. Instead of dealing with the incredible poverty in the country, President after President of Brazil have given inflated contracts to those who bribe them. This increases taxes and the cost of living which increases the level of poverty and subsequently, the level of child prostitution in Brazil. 

Brazilian President Michel Temer reacts during a credentials presentation ceremony for several new

top diplomats at Planalto Palace in Brasilia, Brazil June 26, 2017. REUTERS/Ueslei Marcelino

By Brad Brooks and Ricardo Brito | BRASILIA

Brazil's top federal prosecutor charged President Michel Temer with taking multimillion-dollar bribes on Monday in a stinging blow to the unpopular leader and to political stability in Latin America's largest country.

Rodrigo Janot submitted the charge in a document presented to the Supreme Court, saying "he fooled Brazilian citizens" and owed the nation millions in compensation for accepting bribes.

Under Brazilian law, the lower house of Congress must now vote on whether to allow the top tribunal to try the conservative leader, who replaced impeached leftist President Dilma Rousseff just over a year ago.

Lawmakers within Temer's coalition are confident they have the votes to block the two-third majority required to proceed with a trial. But they warn that support may wane if congressmen are forced to vote several times to protect Temer - whose popularity is languishing in the single-digits - from trial.

Temer's office and his attorney, Antonio Mariz, declined to comment on the charges. Temer has repeatedly said he is innocent of any wrongdoing.

Investigators have uncovered stunning levels of corruption in recent years engulfing Brazil's political class and business elites. Much of it centers on companies paying billions of dollars in bribes to politicians and executives at state-run enterprises in return for lucrative contracts.

Temer and one-third of his cabinet, as well as four former presidents and dozens of lawmakers are under investigation or already charged in the schemes. Over 90 people have been convicted.

Political analysts had warned, long before Monday, that the scandals reduced the chances Temer could push through reforms crucial for Latin America's biggest economy to rebound from its worst recession on record.

Temer was charged in connection with a graft scheme involving the world's largest meatpacker, JBS SA. Executives said in plea-bargain testimony the president took bribes for resolving tax matters, freeing up loans from state-run banks and other matters.

Monday's charging document alleges Temer arranged to eventually receive a total of 38 million reais ($11.5 million) from JBS in the next nine months.

Joesley Batista, one of the brothers who control JBS, recorded a conversation with Temer in March in which the president appears to condone bribing a potential witness. Batista also accused Temer and aides of negotiating millions of dollars in illegal donations for his Brazilian Democratic Movement Party.

Brazil's federal police released a separate document on Monday about that conversation with Batista. Police recovered a previously inaudible portion of the recording in which Temer is heard telling the scandal-plagued billionaire that it was mainly because of his influence that he chose to appoint Henrique Meirelles as finance minister.

The significance of the comment about Meirelles, who is widely respected in financial markets, was not immediately clear and the finance ministry did not respond to requests for comment.

LEGAL GRIDLOCK

Key lawmakers in Temer's alliance told Reuters, on condition of anonymity, they would halt work on proposed labor reforms if forced to vote on charges against the president.

Temer's supporters say they have between 250 and 300 votes in the 513 seat lower house to block a trial. But the president is expected to soon face charges of racketeering and obstruction of justice, each requiring a separate vote. Prosecutors have said they may also file other charges, which they have not yet given details on.

On Monday, the federal police recommended charging Temer with obstruction of justice - the first step toward a likely round of other charges in addition to graft.

Top lawmakers said Janot's expected strategy of presenting charges one at a time would throw Temer's future into uncertainty.

With all of congress facing re-election next year, many said that if public outrage boiled over, it would be hard to maintain support for Temer.

"If this grinds on with multiple votes, you may start to see a lack of governability," said one top lawmaker in Temer's coalition. "In that case, there will be defections, and colleagues may start to move against Temer."

Carlos Melo, a political scientist with Insper, a Sao Paulo business school, said Janot knew he would lose the first corruption charge against Temer "but he is like a chess player, thinking two or three votes down the line."

Melo said the votes by lawmakers, many of whom are facing their own corruption investigations, would be a test of how alienated Brazil's political class was from an increasingly angry population.

"If Congress has any connection left whatsoever with the society it represents, then Janot's strategy of wearing lawmakers down with multiple votes will win and you will see the president put on trial," Melo said.

If congressmen rally around Temer, Melo said, "then we must face the horrific fact that what we have is a political system entirely detached from society, and it will pay the price in next year's election."

(Additional reporting by Lisandra Paraguassu in Brasilia and Tatiana Bautzer in Sao Paulo; Editing by Daniel Flynn and Tom Brown)