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United States v. Indivior Inc.

United States District Court, W.D. Virginia, Abingdon Division

November 14, 2019

INDIVIOR INC., ET AL., Defendants.


          Randy Ramseyer, Assistant United States Attorney, Abingdon, Virginia, for United States; Peter J. Romatowski, Jones Day, Washington, D.C., for Defendants.

         ON BRIEF:

          Daniel P. Bubar, First Assistant United States Attorney, Albert P. Mayer, Kristin L. Gray, Joseph S. Hall, Garth W. Huston, Janine M. Myatt, Carol L. Wallack, United States Attorney's Office, David Morrell, Deputy Assistant Attorney General, Gustav W. Eyler, Jill P. Furman, Matthew J. Lash, Charles J. Biro, U.S. Department of Justice, Civil Division, Consumer Protection Branch, for United States; Thomas J. Bondurant, Jr., and Jennifer S. DeGraw, Gentry Locke, James M. Gross, James P. Loonam, and James R. Wooley, Jones Day, for Defendants.


          James P. Jones United States District Judge

         The defendants, Indivior Inc. and Indivior PLC, are charged in a twenty-eight count Superseding Indictment with fraud offenses stemming from the development and marketing of the prescription medication Suboxone® (buprenorphine and naloxone) sublingual film (“Suboxone Film”). In their present motion, the defendants have moved to dismiss the charges on the ground of alleged government misconduct before the grand jury. In addition, the defendants have requested additional disclosures of grand jury material in order to provide added support for their assertion that the dismissal must be with prejudice as willful misconduct. For the following reasons, I will deny the defendants' Motion to Dismiss and deny their request for disclosure of additional grand jury material.


         Indivior Inc. is a U.S. pharmaceutical company and Indivior PLC is a U.K. pharmaceutical company that has owned Indivior Inc. since December 23, 2014.[1]Suboxone Film is a drug used in the treatment of opioid addiction and dependence, and it is sold throughout the United States. Overall, the government alleges that the defendants deceived health care providers and benefit programs into believing that Suboxone Film is safer and less susceptible to diversion and abuse than other similar drugs. The government charges that the defendants' fraudulent scheme hindered accurate assessments regarding opioid-addiction treatment in order to increase the defendants' profits and reduce competition from generic brands.

         The defendants were originally charged in an April 9, 2019, Indictment, and the government later obtained the nearly identical August 14, 2019, Superseding Indictment. The government has charged the defendants with: (1) one count of conspiracy to commit mail, wire, and healthcare fraud, all in violation of 18 U.S.C. § 1349; (2) one count of healthcare fraud, in violation of 18 U.S.C. §§ 2 and 1347; (3) four counts of mail fraud, in violation of 18 U.S.C. §§ 2 and 1341; and (4) twenty-two counts of wire fraud, in violation of 18 U.S.C. §§ 2 and 1343.

         According to the government, the defendants knew that specific physicians were prescribing buprenorphine in a careless and clinically unwarranted manner, but the defendants nonetheless continued to refer prospective patients to these physicians through the “Here to Help” program. Superseding Indictment ¶¶ 97-143, ECF No. 115. The Superseding Indictment refers to these physicians as Doctors “A, ” “B, ” “C, ” and “D”. The Superseding Indictment alleges interactions between the defendants and these physicians that include communications about making a switch to Suboxone Film, as well as referrals of prospective patients to the physicians through the defendants' “Here to Help” program. As pertinent to the present motion, both the initial Indictment and the Superseding Indictment refer to Doctor D's healthcare fraud convictions in the United States District Court for the Eastern District of Kentucky.

         The principal difference between the initial Indictment and the Superseding Indictment is additional language about the circumstances of Doctor D's convictions.[2] In the original Indictment, the grand jury alleges that Doctor D was convicted of seventeen healthcare fraud violations in the Eastern District of Kentucky but provided no other context. The Superseding Indictment includes additional information about the convictions, specifically that the fraud was related to urine testing.[3] The government claims that the change was intended to clarify the context of Doctor D's separate criminal conduct, and that the convictions were included to demonstrate that the defendants continued to refer patients to Doctor D even after receiving notice that Doctor D practiced medicine in a careless manner.


         The defendants' Motion to Dismiss, filed prior to the return of the Superseding Indictment, is based on two separate but related arguments. First, the defendants assert that the allegation in the initial Indictment of an unindicted individual's separate healthcare fraud convictions - Doctor D's convictions in the Eastern District of Kentucky - resulted from false and improper evidence presented to the grand jury since it indicated by implication that the convictions were related to Suboxone Film. Defs.' Mem. Supp. Mot. Dismiss 11-16, ECF No. 82. The defendants also claim that all charges must be dismissed because these factual paragraphs were realleged by reference in each count of the Indictment. Id. at 10. The government admitted in its response that it had failed to introduce evidence relating to Doctor D's healthcare fraud convictions in the original Indictment, but that it had returned to the same grand jury to present the mistakenly omitted information and provide the additional information for the Superseding Indictment. United States' Resp. Opp'n Mot. to Dismiss 2 n.2, ECF No. 127.

         Upon the government's admission and the return of the Superseding Indictment, the defendants' argument has morphed into a claim that the failure to present evidence of Doctor D's role as a physician who operated in a careless manner, while still including the information in the original Indictment, strongly implies government misconduct that warrants further investigation into the sufficiency of the evidence presented to the grand jury. The defendants further contended in oral argument that introducing the information before the same grand jury considering the Superseding Indictment, as well as clarifying the nature of Doctor D's convictions to address the defendants' concerns, did not cure the purported prior misconduct.

         The defendants argue that the above-alleged misconduct was not the only wrongdoing that occurred before the grand jury, and that a review of the grand jury transcripts is necessary to determine whether the Superseding Indictment should be dismissed with prejudice. Defs.' Mem. Supp. Mot. Dismiss 16, ECF No. 82; Defs.' Reply Mem. 16-17, ECF No. 138. For example, the defendants point to asserted Fifth Amendment abuses contained in disclosed grand jury transcripts that they claim substantially prejudiced the grand jury against them. The defendants also assume that the government incorrectly instructed the grand jury on the law and made improper characterizations of evidence during the colloquy. Finally, the defendants proclaim that, regardless of whether the ...

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