NEW YORK (TheStreet) -- Insys Therapeutics (INSY) continued to plunge Monday after Friday's report from a Michigan local news site that a doctor had allegedly committed fraud in prescribing the company's drug Subsys.
Dr. Gavin Awerbuch allegedly prescribed Subsys to individuals who did not need it and then billed Medicare for the prescriptions, according to MLive.com, which quoted the allegations of federal authorities. Subsys is an opiate that is stronger than heroin but does not last as long and is used as a painkiller when morphine is not sufficient.
Awerbuch was arraigned in federal court on May 6 on charges of health care fraud and distribution of controlled substances. MLive.com reported a court affidavit claims he prescribed approximately 20.3% of the Subsys given to Medicare beneficiaries nationwide from Jan. 2009 through Feb. 2014.
"Medicare paid Awerbuch $6.9 million from Jan. 1, 2009, through Feb. 6, 2014, for Subsys he prescribed. The next highest amount a U.S. prescriber received was $1.6 million," the article states. "He wrote 1,283 prescriptions for the drug in five years, while the next closest prescriber wrote 203 prescriptions, the complaint stated."
Insys fell 15.39% to $27.65 at 12:36 p.m. on Monday after a rapid and steep decline Friday afternoon.