Pharmaceutical exec gave lap dance to doctor in drug bribes scheme, witness says

Boston --  A former pharmaceutical executive accused of joining in a scheme to bribe doctors into prescribing a powerful painkiller once gave a lap dance to a doctor the company was pressuring to get his patients on the drug, her onetime colleague said Tuesday.

Jurors heard the testimony on the second day of the federal trial in Boston against Insys Therapeutics founder John Kapoor and four other former executives. They include Sunrise Lee, whom prosecutors have described as a former exotic dancer who was hired to be a regional sales manager even though she had no experience in the pharmaceutical world.

The executives are charged with conspiring to pay doctors kickbacks in the form of fees for sham speaking events that were billed as opportunities for other physicians to learn about the drug, a highly addictive fentanyl spray. In reality, prosecutors say, the events were mainly social gatherings for doctors and their friends to enjoy a fancy meal.

Lawyers for Kapoor, 75, and the others have denied all wrongdoing. Kapoor's attorneys told jurors as the trial opened Monday that any criminal activity was orchestrated by Alec Burlakoff, former vice president of sales, who pleaded guilty to the kickback scheme and is expected to testify against Kapoor.

The case has put a spotlight on the federal government's efforts to go after those it says are responsible for fueling the deadly drug crisis.

Kapoor's company makes Subsys, a fentanyl spray medication approved only for severe cancer pain. Prosecutors said Kapoor helped devise a plan to bribe doctors into prescribing the potent opiate to non-cancer patients, reported CBS News' Jim Axelrod. 

Holly Brown, who worked as an Insys sales representative, told jurors that her superiors encouraged her to focus her attention on a doctor who was known for prescribing lots of opioids in Chicago and northwest Indiana. Brown said she had concerns about Dr. Paul Madison, describing his office as a "shady operation" being run out of a "dingy strip mall in a not-so-nice area of town."

Despite that, Madison became a speaker for Insys and started getting paid, Brown said. She said she struggled to get other doctors to attend Madison's speaking events because of his unsavory reputation, so Madison would invite his friends.

"The idea was that these weren't truly meant to be educational programs but they were meant to be rewards, basically, for the physicians," Brown said.

Brown described after one Chicago dinner going with Lee, Madison and another sales representative to a club called The Underground. At one point, Brown said, she saw Lee sitting on Madison's lap and "bouncing around," with Madison's hands "inappropriately all over" Lee's chest.

Lee's lawyer, Peter Hortsmann, denied the allegation during his opening statement Monday after prosecutors had mentioned it and accused them of "objectifying her in the same way Alec Burlakoff did and Dr. Madison did," The Boston Globe reported .

On Tuesday, Hortsmann tried to show that Brown's memory was faulty, noting that they all had been drinking. He also pressed Brown on whether she had been warned that Madison had a "certain reputation with female sales reps" and whether it seemed that Madison "appeared to be taking advantage" of Lee at the club. Brown said she had been warned and agreed with the latter observation.

Madison was convicted in autumn in an unrelated matter on a variety of charges, including health care fraud. He is scheduled to be sentenced in March. Madison's lawyer said Tuesday his client had no comment.

CBS News reported Insys made 18,000 payments to doctors in 2016 that totaled more than $2 million. CBS News has identified headache doctors, back pain specialists and even a psychiatrist who received thousands of dollars to promote the drug. 

Testimony will continue Wednesday in the trial, which could last more than three months.