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Former Regional Sales Director for Insys Therapeutics Sentenced for Racketeering Conspiracy

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Defendant bribed physicians and encouraged sales reps to profit from criminal scheme

BOSTON – A former Regional Sales Director for Insys Therapeutics was sentenced today in federal court in Boston for his role in conspiring to bribe practitioners to prescribe Subsys, a fentanyl-based pain medication.

Joseph A. Rowan, 45, of Panama City, Fla., was sentenced by U.S. District Court Judge Allison D. Burroughs to 27 months in prison, three years of supervised release, restitution to be determined at a later date and ordered to pay approximately $2 million in forfeiture. The government recommended a sentence of 120 months in prison.

In May 2019, Rowan was convicted by a federal jury of racketeering conspiracy along with four other Insys executives.

Subsys, a drug owned and manufactured by Insys Therapeutics, Inc., is a fentanyl-based, rapid-onset opioid approved to treat cancer patients suffering intense breakthrough pain. From May 2012 to December 2015, Rowan and his co-defendants conspired to bribe practitioners, many of whom operated pain clinics, in order to induce them to prescribe Subsys to patients. The defendants also conspired to mislead and defraud health insurance providers who were reluctant to approve payment for the expensive drug when it was prescribed for patients without cancer. Medicare would not approve payment for the drug except to treat breakthrough cancer pain.

Beginning in 2012, Rowan joined Insys as a sales representative working exclusively with a doctor in Alabama known to write prescriptions for fentanyl products. Rowan paid the doctor speaker honoraria in exchange for Subsys prescriptions, and was so successful that it became a model within Insys. Rowan was subsequently twice promoted, ultimately becoming a Regional Sales Manager. In this role, Rowan fueled the criminal scheme by approving the use of speaker programs to bribe doctors to write more Subsys prescriptions, and to write Subsys prescriptions at increasingly higher dosages.

In addition, Rowan stressed the importance of the success of the Insys Reimbursement Center (IRC) to sales representatives. During a national sales meeting, Rowan encouraged sales employees to assist the IRC and stated, “what I am saying is this. This is how you get paid…”

United States Attorney Andrew E. Lelling; Joseph R. Bonavolonta, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division; Phillip Coyne, Special Agent in Charge of the U.S Department of Health and Human Services, Office of the Inspector General; Judy McMeekin, Pharm.D. Acting Associate Commissioner for Regulatory Affairs of the U.S. Food and Drug; Brian D. Boyle, Special Agent in Charge of the Drug Enforcement Administration, Boston Field Division; Leigh-Alistair Barzey, Special Agent in Charge of the Defense Criminal Investigative Service, Northeast Field Office; Carol S. Hamilton, Acting Regional Director of the U.S. Department of Labor, Employee Benefits Security Administration, Boston Regional Office; Joseph W. Cronin, Inspector in Charge of the U.S. Postal Inspection Service’s Boston Division; Matthew Modafferi, Special Agent in Charge of the U.S. Postal Service Office of Inspector General, Northeast Area Field Office; Jeffrey K. Stachowiak, Acting Special Agent in Charge of the Department of Veterans Affairs, Office of Inspector General; and Thomas W. South, Deputy Assistant Inspector General for Investigations of the Office of Personnel Management made the announcement.

Assistant U.S. Attorneys K. Nathaniel Yeager, Fred M. Wyshak, and David G. Lazarus prosecuted the case for Lelling’s Health Care Fraud Unit.

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