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What’s New/Significant
The Department of Justice (DOJ) announced June 30 that the chief executive officer of Indivior PLC, Shaun Thaxter, pleaded guilty to one count of causing the introduction into interstate commerce of the opioid drug Suboxone Film, which was misbranded in violation of the Federal Food, Drug, and Cosmetic Act (FDCA). Under the terms of the plea agreement filed with the federal court in Virginia, Thaxter agreed to pay $600,000 in fines and forfeiture and faces up to one year in prison. He will be sentenced on Sept. 29, 2020, and has stepped down as CEO.
In April 2019, a Virginia federal grand jury indicted Indivior for allegedly engaging in an illicit nationwide scheme to increase prescriptions of Suboxone. The criminal trial against Indivior is scheduled to begin on Sept. 28, 2020, in the U.S. District Court in Abingdon, Virginia.
This plea is an example of the government’s continued priority under the Yates Memorandum to pursue responsible executives as part of larger corporate investigations. In this case, the government found that Thaxter failed to prevent and promptly correct the distribution of false and misleading information.
Allegations
In 2012, Thaxter oversaw Indivior’s marketing and sales efforts to secure formulary coverage for Suboxone Film from the Massachusetts Medicaid agency (MassHealth), which was the largest Medicaid program in the country by volume of addiction-treatment drugs. At the time, Suboxone Film and other Suboxone products such as Subutex Tablets generated substantially all of Indivior’s revenue. However, the company actively promoted Suboxone Film and paid bonuses and incentives only for sales of Suboxone Film.
Thaxter asked Indivior employees to develop a plan to win preferred drug status for Suboxone Film at MassHealth, which was considering a non-opioid competitor for opioid-addiction treatment. Certain Indivior employees subsequently used false and misleading information to deceive MassHealth officials into believing that Suboxone Film had the lowest rate of unintended pediatric exposure compared to both Subutex Tablets or the non-opioid competitor, when in fact, Subutex Tablets had the lowest rate. Based on that information, in December 2012, MassHealth approved and provided access to Suboxone Film for Medicaid patients living in households with children younger than 6 years old. After learning of the false and misleading information, Thaxter approved sending corrected information to MassHealth in December 2015, which was two years after the government’s investigation into Indivior had begun.