The billionaire founder of Arizona-based Insys Therapeutics, John Kapoor, has resigned from the company’s board of directors following his arrest on charges he participated in a scheme to bribe doctors and mislead health insurance companies in an effort to boost sales of the company’s powerful opioid painkiller Subsys.
Subsys is a highly potent, fentanyl-based spray that is only intended for breakthrough pain in cancer patients.
Kapoor, Insys’ majority shareholder, resigned as chief executive officer in January after being charged with engaging in conspiracies to commit racketeering, mail fraud and wire fraud. Board members Patrick Fourteau, also resigned citing personal reasons. Kapoor joins six former Insys executives and managers who face similar charges, including Michael Babich, Alec Burlakoff, Michael J. Gurry, Richard M. Simon, Sunrise Lee, and Joseph A. Rowan.
Kapoor was released on $1 million bond following a hearing in Phoenix. He is scheduled to appear in a Massachusetts federal court on Nov. 16.
Kapoor said he stepped down from Insys’ board of directors to distance the company from any unnecessary attention caused by his arrest. He said he intends to put his shares in a trust to be independently controlled.
“We will continue to cooperate with ongoing investigations and strive to resolve them as circumstances permit,” said Insys President and Chief Executive Officer Saeed Motahari, in a statement.
The news comes just days after President Trump declared the opioid epidemic a public health emergency.