By Nate Raymond
NEW YORK (Reuters) - Two former Insys Therapeutics Inc employees pleaded not guilty on Wednesday to charges that they engaged in a scheme to pay doctors kickbacks including speaker fees to prescribe a drug containing the opioid fentanyl.
Jonathan Roper, a former Insys district sales manager, and Fernando Serrano, a former sales representative, entered their pleas in Manhattan federal court to charges including that they violated the federal Anti-Kickback Statute.
Their pleas followed their arrests in June and came amid various probes involving Insys and its fentanyl-based sublingual spray Subsys as U.S. law enforcement seek to combat a national opioid abuse epidemic.
Insys, based in Arizona, is not identified by name in the indictment against Roper, of Commack, New York, and Serrano, of Manalapan, New Jersey.
But details in the charging papers about the company and drug match Insys and Subsys. A LinkedIn (NYSE:LNKD) profile for Serrano shows he previously worked for Insys.
Insys did not respond to requests for comment.
Subsys, which Insys launched in 2012, is a spray approved for managing pain in cancer patients that contains fentanyl, a highly-addictive and regulated synthetic opioid. It generated $329.5 million in net revenue in 2015.
Prosecutors said that to market the spray, Insys established a program in which it paid doctors to act as speakers at educational presentations targeting healthcare professionals.
But prosecutors said many of the programs Roper and Serrano organized were social gatherings at high-end Manhattan restaurants where no education about the spray took place and where audience sign-in sheets contained forged signatures.
Both men were involved in organizing speaker programs for two Manhattan doctors who in 2014 were among the largest prescribers of the spray while earning $147,000 and $112,000 each in speaker fees, the indictment said.
The indictment said Roper and Serrano also were involved in paying for undisclosed alcoholic drinks and meals for doctors.
In court, Assistant U.S. Attorney Noah Solowiejczyk said more charges could be brought.
"The government is continuing to investigate," he said.
Insys has said that it has received information requests or subpoenas from eight other U.S. Attorneys' offices outside of Manhattan regarding doctors it had interacted with.
Those charged include a Connecticut nurse practitioner who in 2015 pleaded guilty to violating the kickback law, and an ex-Insys sales representative in Alabama who pleaded guilty in February to conspiring to violate the statute.
Insys also faces other state and federal investigations related to Subsys including into its sales and marketing practices.
The case is U.S. v. Roper et al, U.S. District Court, Southern District of New York, No. 16-cr-00542.