Ar­rested Ari­zona bil­lion­aire re­signs seat on In­sys board

The Arizona Republic - - Business - Russ Wiles Ari­zona Re­pub­lic USA TO­DAY NET­WORK Reach the re­porter at 602-444-8616 or russ.wiles@ari­zonare­pub­lic.com.

John Kapoor, the founder and for­mer chair­man and CEO of Chan­dler-based In­sys Ther­a­peu­tics, re­signed his board seat over the week­end fol­low­ing his ar­rest last week on charges that in­clude rack­e­teer­ing, con­spir­acy to com­mit mail fraud, con­spir­acy to com­mit wire fraud and con­spir­acy to vi­o­late an anti-kick­back statute.

Pa­trick Fourteau, a vet­eran phar­ma­ceu­ti­cal com­pany ex­ec­u­tive, also re­signed from In­sys’ board after serv­ing six years. The com­pany ac­cepted both res­ig­na­tions.

Sep­a­rately, In­sys an­nounced that it has com­piled $150 mil­lion in re­serves as po­ten­tial set­tle­ment funds for the De­part­ment of Jus­tice’s in­ves­ti­ga­tion against it.

Kapoor, 74, who was on In­sys’ board since the com­pany’s for­ma­tion in 1990,stepped down in Jan­uary as chair­man. He ap­peared in U.S. Dis­trict Court in Phoenix Oct. 26, after hav­ing been ar­rested that day at his Phoenix home.

He was or­dered to sub­mit to the at­tach­ment of a mon­i­tor­ing de­vice, not leave Mari­copa County and sur­ren­der his pass­port as he awaits an ar­raign­ment in Bos­ton next month. Six for­mer of­fI­cials of In­sys, which has 400 em­ploy­ees, also face charges.

Kapoor was listed among the seven rich­est Ari­zo­nans by Forbes last year with an es­ti­mated net worth at the time of $2.1 bil­lion.

The U.S. At­tor­ney’s Of­fice in Mas­sachusetts said Kapoor and the other for­mer com­pany of­fi­cials con­spired to bribe med­i­cal prac­ti­tion­ers in var­i­ous states to en­cour­age them to pre­scribe a pow­er­ful nar­cotic in­tended to treat pain for can­cer pa­tients. In ex­change for bribes and kick­backs, the prac­ti­tion­ers wrote large num­bers of pre­scrip­tions for pa­tients, most of whom were not di­ag­nosed with can­cer, the gov­ern­ment al­leges.

The in­dict­ment also al­leges that Kapoor and the six for­mer ex­ec­u­tives con­spired to mis­lead and de­fraud health in­sur­ers that were re­luc­tant to ap­prove pay­ment for the drug when it was pre­scribed for non-can­cer pa­tients.

The $150 mil­lion the com­pany set aside for the mat­ter “rep­re­sents the com­pany’s best es­ti­mate of the min­i­mum li­a­bil­ity ex­po­sure the com­pany ex­pects to pay over five years in con­nec­tion with this mat­ter,” In­sys said in a state­ment. “The ul­ti­mate amount of po­ten­tial li­a­bil­ity may ma­te­ri­ally ex­ceed the $150 mil­lion.”

The com­pany added that the gov­ern­ment hasn’t ac­cepted man­age­ment’s of­fer and there can be no as­sur­ance that it will.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.