The 2017 federal trial and conviction of doctors Xiulu Ruan and John Patrick Couch was big news in Mobile -- so big that probably few onlookers were aware it was part of a much bigger game.
Prosecutors in Mobile were focused on proving that the practices Couch and Ruan had used at their Physician’s Pain Specialists of Alabama (PPSA) clinics were so driven by financial motivations that they violated any standard of reasonable medical conduct. They were successful: The two doctors were convicted on an array of charges that included money laundering, mail and wire fraud and even a violation of the RICO organized crime statute. Couch and Ruan drew sentences of 20 and 21 years, respectively.
Though this was little noticed in Mobile, the case was linked with others. Prosecutors in various jurisdictions were working their way up the food chain, from nurse practitioners to doctors, from sales reps to pharmaceutical executives. One of the drugs that featured prominently in the Mobile case was Subsys, made by the company Insys. In spring 2019, two years later and far away in Boston, Insys founder John Kapoor was found guilty of racketeering conspiracy and later sentenced to five and a half years in prison. A slate of Insys executives, many of whom had struck plea deals and testified against him, also went to prison.
Now journalist Evan Hughes has produced a book that ties it all together: “Crime and Punishment at an Opioid Startup.” It was published Tuesday by Doubleday. While primarily the story of the rise and fall of Insys, the book also revisits the Mobile trial and provides an eyebrow-raising look into the PPSA clinics.
Hughes recently took the time to answer a few questions about the Insys saga and its Mobile connection. The following has been edited for space and clarity.
Q: There’s an interesting parallel here between John Kapoor and Dr. Xiulu Ruan: Both were first-generation immigrants who, to a point, exemplified the classic American tale of immigrant upward mobility. They leveraged medical and scientific education into entrepreneurial success, they worked hard, they reached enviable heights. Ultimately, though, they crossed dangerous lines. The similarity isn’t explored much in the book, but did it present itself to you?
Hughes: “It’s a great point. I think they were extremely similar. It did occur to me. They were both ambitious and they dedicated themselves singlemindedly to building their business. They were somewhat ruthless in that. They were tough on their subordinates. They were not tolerant of anyone getting in the way of their goals. And I think a lot of successful people are like that. I’m not describing necessarily criminal attributes, but in this case these men clearly both went too far. … They didn’t want to be told ‘No.’ They didn’t want to be told no by a doctor, by an insurance company, by a lawyer.”
Q: Insys comes off as an outlaw company, but there’s an interesting point early on where John Babich, one of Kapoor’s inner circle, gains favor by convincing him to move investment money out of Alabama-based HealthSouth. You write that Babich “detected an odor” around HealthSouth. Years later, there are probably still a lot of people in Alabama who wish they’d smelled that odor before scandal erupted around HealthSouth’s accounting practices. It goes to show that however blind they were to the consequences of flouting the law, Insys leaders were not stupid people.
Hughes: “He clearly made a smart investment decision that HealthSouth was not a great bet as an investor. Babich had talent as a leader, as a business mind. You can understand why John Kapoor would take him as a protégé, as someone with talent who could help his company. He was a very young man at the time. The career of someone like Mike Babich could have gone a lot of different ways. He could have gone on to play a valuable role in society and unfortunately it didn’t go that way. This whole group of people who are portrayed in the book, it’s too easy to say that they’re just a bunch of criminals. What they were was this group of smart businesspeople, making decisions in the system they were in. Yes, they were heedless, they were reckless and they deserved to be held accountable, but I think they were recognizable human people operating within a system.”
"The Hard Sell: Crime and Punishment at an Opioid Startup" is about the rise and fall of Insys Pharmaceuticals, but it revisits the high-profile trial of two doctors in Mobile.Doubleday
Q: One major point you make is about that system. In many cases Insys leaders were using methods they’d learned at other pharmaceutical companies, such as recruiting doctors into lucrative “speaker programs,” or suggesting that painkillers approved for very narrow uses could be prescribed more broadly. They were just much too blatant about it. And they thought the worst that would happen would be bureaucratic punishment.
Hughes: “That’s what made this a really landmark case … The model is, a drug company comes under investigation for its marketing practices -- and that is a very common event -- and then years later what it leads to is a settlement. The company pays some money. Often the stock of the company rises when that happens, because they have put the ordeal behind them. The people who worked there go on to have good careers in pharma. In this case there was true accountability. The top executives were charged individually with crimes. There was no way to settle. They could plead to a felony or go to trial. And John Kapoor was the kind of person who would fight. So they went to trial, and they went to jail, which is unprecedented in connection with the opioid crisis.”
“The trial, to me, broke open this window into how drug companies do business, how they insinuate themselves into the lives of doctors in order to influence prescribing. And I think patients just aren’t aware what’s going on behind the scenes.”
Q: There’s a point in the book where things are already heating up for Insys, prosecutors are on the prowl, blood is in the water, and you mention that at that point the company still didn’t have inside legal counsel. My jaw dropped.
Hughes: “In a way their biggest mistake was not doing what most drug companies do, which is taking self-protective measures. I don’t want to say all drug companies are guilty of illegal conduct. That would not be fair. But all drug companies are pushing up against the bounds of what is allowed in order to market their products. That’s what you have to do to compete. And regulators cotton on to certain tactics and try to crack down, well, the drug companies find another avenue. Insys was a story of recklessness, where they left behind a wealth of evidence of their intentions, and thus they could be prosecuted criminally and successfully.”
Q: Insys was a stock-market darling, and at one point Kapoor’s stake in it made him worth $1 billion, at least on paper …
Hughes: “Over $2 billion, I think, at the peak.”
Q: … and you can’t help but wonder, couldn’t the dude have just cashed out and walked away at some point?
Hughes: “Right. Right. He was very persistent. And this was a pattern with him at other companies, too. He didn’t like to walk away from things. And I think he thought of Insys as the crowning moment of his career. He was in the twilight of his career. He thought Subsys would be followed by other successful drugs that Insys had in the pipeline. He thought he could kind of just power his way through the scrutiny and investigations that Insys came under. But I think the environment had changed in terms of regulatory priorities. Opioids had climbed toward the top. There was a real intention at the national level and at the local levels to crack down on the way these drugs were marketed.”
Q: The case of Ruan and Couch certainly illustrates that. There’s a presumption that doctors have a lot of leeway. And despite the excesses that came out in that trial, you still hear the argument that these types of prosecutions chill the ability of doctors to treat their patients as they see fit.
Hughes: “What is the standard? How do you prove that any one given prescription was a violation of the Controlled Substances Act? It’s hard to do that. Doctors are given a tremendous amount of leeway to prescribe. They don’t have to prescribe strictly on the indications on the label, etcetera. But when you show a pattern of conduct that is often driven by greed and monetary decisions, the prosecutors are able to tie payments from Insys and other drug companies with upticks in prescriptions of those products, they would alter their prescribing habits based on that, based on scrutiny. Those aren’t good-faith mistakes.”
Q: There was a point where someone at another company, Galena, said there was no point in paying Couch or Ruan to participate in a speaker program for their drug, Abstral, because no other doctors in the area were interested in prescribing it. Really?
Hughes: “Yes, actually. Abstral and Subsys, the drugs that Galena and Insys sold, were niche drugs. They’re not like an Oxycontin or a Vicodin or a Percocet. Most doctors hadn’t even heard of these drugs.
“That’s part of what made it kind of an obvious charade when Insys was holding speaker programs, so called, once a week for Doctor Ruan and Dr. Couch to allegedly be educating other doctors about Subsys, when in fact what they were doing was going out to dinner usually with their own staff and with the Insys sales rep and being paid for it.”
Q: The PPSA clinics were shut down abruptly by raids. I’ve heard a mix of things from other medical professionals in the area. Some have said, rather scornfully, that this sent a wave of pill-seeking addicts to other providers, like a zombie attack. Others have expressed concern about the way patients were sort of hung out to dry.
Hughes: There was a mix of things going on. But one thing that’s true nationwide is that it’s kind of a perverse thing, but owing to the crackdown on opioid prescribing and changing medical opinion about it, especially the idea of prescribing opioids over the long term for chronic pain, a lot of providers are scared of dealing with pain patients. And of how to make them better. One way to respond to that is, I’m going to refer them to a dedicated pain clinic. What ends up happening sometimes is that they’re kind of referred into the lion’s den. They get referred to a place that doesn’t have their best interests at heart.
“It is interesting because when people hear the words ‘pill mill’ you might think of a doctor who is essentially trading cash for pills. Like, they’re a doctor in name only. They open up a storefront and they are essentially a drug dealer. Couch and Ruan, it’s a little bit of a different world. They didn’t take cash patients, on the whole. So that means providers were actually referring patients to Couch and Ruan. They had genuine expertise and education. The model was different. They weren’t just making 200 bucks for the appointment and then giving a prescription. The real financial opportunities were actually much bigger than that. They were about referring out for procedures and getting some kind of thinly veiled kickbacks for it, taking moneymaking opportunities from drug companies such as these speaker programs that were really a sham, they were really just a method of getting money into the hands of doctors. It was kind of a money machine, I think was the term prosecutors used in Mobile.
“There were drug seekers who came to PPSA but on the whole a lot of these patients were legitimately in pain. Doctors referred them to PPSA and they had no idea what they were getting into.
“You have to remember that a huge percentage of those patients were on high-dose opioids, and the way that those drugs are regulated you have to go back to the clinic every month to get a prescription. So when the doors to the clinic shut, they were coming day after day to their appointments and the doors were closed. You immediately go through withdrawal, coming off opioids, and that’s no judgment on you, that’s a medical dependency. So yes, they were going to other providers, they were desperate. I don’t think they deserved any scorn for that. But pain patients to present difficult problems, especially if they come to you as a provider already on a very high-dose regimen. It’s difficult to know what to do.”
Q: Of course you’re aware the U.S. Supreme Court will consider an appeal in Ruan’s case. What’s your take on that?
Hughes: “I think that came as a surprise to a lot of people close to the case. What it’s really about, I think the Ruan case presented an opportunity to the Supreme Court to take up a longstanding issue. There’s been kind of an unsettled question in the law of what constitutes a doctor violating the Controlled Substances Act. The crime of violating the Controlled Substances Act is essentially to be a drug dealer. So, how can a doctor be that? A doctor has a license to prescribe these drugs. The question is about whether the doctor’s intentions [are a factor], whether there can be good faith defense.
“Really the issue is about the jury instructions at trial, moreso than anything else. We’ll see what happens. Whatever the Supreme Court does will have to be taken up by the court of appeals and may go all the way back to the district court down in Mobile. So it’ll be a long road.”
Q: You use the metaphor that the speed limit was 55, most companies were going 75 and Insys was going 85. And you seem to conclude that while the case was extraordinary, it might not have changed things much.
Hughes: “Insys gets caught. Does that mean everybody else stops going 75? I don’t know. I don’t think so. It certainly sends a powerful signal, that they were prosecuted, to the rest of the industry. But this doesn’t change everything.”
Q: Reading the book, it seems there are moral failures at play: Not just the greed that drove Insys, but the way certain doctors craved the flattery and attention they got from the company. It’s a case of flawed people bringing out the worst in other flawed people. But you don’t preach on that, you keep it clinical.
Hughes: “It is very much intentional that the book is not a tirade, it is not meant to endlessly cast judgment. I’m quite restrained in the tone. It’s more in the storytelling mode than the judgment mode. It’s a fantastic, fascinating story, if you ask me, the Insys saga. I wanted to kind of see through the eyes of the ‘bad guys’ so to speak. It wanted it to be told from the perspective of the insiders, rather than a hostile outsider. It’s told from the perspective of these executives and how they justified the decisions they were making and also these doctors and nurse practitioners.
“I do think that what the book brings you to is just how deeply damaged the system is, in which these decisions occurred. It’s less about these people, these individual players, than the game.”
Source : https://www.al.com/news/mobile/2022/01/hard-sell-qa-author-revisits-trial-of-mobile-doctors-couch-ruan.html