Yesterday, it was reported that the billionaire founder of Insys Therapeutics Inc. (NASSDAQ:INSY) was arrested on charges related to his participation in an alleged scheme to bribe doctors into prescribing unqualified patients the company's fentanyl-based pain drug that is intended for cancer patients. This development comes alongside President Trump declaring the United States' opioid crisis a "a national health emergency.”
John Kapoor, the 74 year old founder of Insys, stepped down as CEO of the company back in January, but was just charged with a handful of serious charges including conspiracies to commit racketeering, mail fraud and wire fraud, as CNBC reports.
Kapoor remains the chairman of Akorn Inc. (NASDAQ:AKRX), a generic pharmaceuticals manufacturer based in Lake Forest, Illinois which has been running into problems of its own recently. According to a recently posted FDA Form 483, the agency found problems with Akorn’s sterile manufacturing during an inspection of the comapny's injectables plant in April.
At 4:55:13 P.M. EST, Nasdaq halted shares of INSY at a last sale price of $5.74, for "additional information requested" from the company. With a 52-week high of $15.06 per share, INSY is down approximately 61% off of those highs following the recent news.
Back in September, the company reacted to the investigation by the Arizona Attorney General with a statement saying that they "continue to reiterate our efforts to be part of the solution to the opioid crisis by focusing on assisting patients and developing alternative pain medications in our research and development programs."
Based on the recent turn of events, it seems undeniable that Insys is anything but part of the problem rather than the solution. While the company's fentanyl-based SUBSYS has nothing to do with cannabis, the company got onto our radar due to its pre-clinical dronabinol oral solution, SYNDROS. Dronabinol a.k.a. synthetic Delta-9-tetrahydrocannabinol, is a laboratory-made twin of the cannabinoid that is naturally occurring in marijuana.
Since the 1980's, AbbVie (NYSE:ABBV) has had an FDA approved drug called Marinol (dronabinol capsules) that is used for treating appetite loss associated with AIDS as well as for nausea and vomiting associated with chemotherapy cancer treatment. Insys' SYNDROS is meant to utilize the same dronabinol formulation to treat other indications like epilepsy and more.
We'll be sure to keep readers posted as this situation develops. Be sure to subscribe to one or more of our free e-mail newsletters so you never miss an important marijuana stock update. Also, don't forget to connect with The Daily Marijuana Observer on social media via Facebook, Twitter, StockTwits, YouTube, and Instagram.