A wide-ranging kickback probe has mostly wiped out Insys' former executive team and led to the company's bankruptcy, but the scandal isn't over. In an effort to escape a prison cell, one of those former managers ventured an interesting case: Big Pharma is sexist, and her role in the scheme was only to "smile and close."
Former Insys sales exec Sunrise Lee accused her former employer of hiring female exotic dancers to target "lonely overworked" physicians in a sales scheme her attorneys called a "pharmaceutical dystopia," according to a sentencing memo.
In the plea for leniency, Lee's attorneys pointed to a well-worn trope of drugmakers targeting recent female college grads to help sell products in the predominantly male field of medicine, saying the industry "thrives on former models and cheerleaders with no background in science."
Despite the plea, Lee was sentenced Wednesday to a year and a day in federal prison, the harshest penalty so far convicted in the scheme.
Another executive, former CEO Michael Babich who previously pleaded guilty to a lesser charge to cooperate with federal authorities, was sentenced to 30 months in prison also on Wednesday.
According to Lee, a former exotic dancer who was convicted of wire and mail fraud in May, Insys' former VP of sales Alec Burlakoff allegedly engaged in "'Wolf of Wall Street' tactics" by hiring her and other adult entertainers to help boost sales of Subsys, an under-the-tongue fentanyl spray at the heart of multiple federal kickback cases against former Insys employees.
Burlakoff encouraged Lee to "smile and close," a clear direction she was to use her sexuality as a sales tactic, attorneys said.
"The obvious inference from these words of wisdom were to flaunt her physical beauty and or sexuality until she closed the Subsys deal with each doctor," Lee's attorneys wrote. "If Big Pharma was not in the business of exploiting women in exchange for profit, there would never have been a Sunrise Lee for the Court to sentence in this case."
Burlakoff was among a group of former Insys execs, including founder and former CEO John Kapoor, named in a federal kickback probe that has netted some of the highest-ranking convictions for any opioid maker. In May, Kapoor, Lee and three other former execs were found guilty, but a federal appeals judge later vacated the racketeering portion of the verdict.
The executives were convicted for orchestrating a scheme to direct sales members to entice doctors to prescribe Subsys through an elaborate series of kickbacks. The plan included visits to strip clubs, “lavish” dining and entertainment outings, and jobs for relatives and friends of people who prescribed Subsys.
On Monday, two of those former executives, national sales director Richard Simon and regional sales director Joseph Rowan, were sentenced to 33 and 27 months in prison, respectively, for their roles in the Subsys scheme.
Both men were also ordered to serve three years of probation, forfeit more than $2 million and pay restitution, which will be determined at a later date.
Earlier this month, another former exec, Michael Gurry, a former Insys vice president, was sentenced to up to 33 months in federal prison and will also face up to 33 months of probation upon release. Immediately after the sentencing, Gurry's attorneys filed for a stay of incarceration pending appeal.