Jeffrey Pearlman Indicted in Fentanyl Kickback Scheme

Jeffrey Pearlman, 49, of Edgewood, N.J., is facing federal charges for running a corrupt kickback scheme tied to the prescription of Subsys, a potent fentanyl-based spray, prosecutors announced. Indicted on February 8, 2017, by a federal grand jury in New Haven, Pearlman is accused of weaponizing sham speaker events to bribe medical professionals into pushing a dangerous opioid — all while defrauding federal healthcare programs.

Pearlman, a former District Sales Manager at Insys Therapeutics, allegedly turned medical education into a pay-to-play operation. From September 2012 to December 2015, he and his sales team flooded high-end restaurants across Connecticut, New York, New Jersey, and Rhode Island with fake ‘Speaker Programs.’ These events, often attended by friends and non-prescribers, had no educational value — but came with speaker fees ranging from $1,000 to several thousand dollars. Sign-in sheets were forged to create the illusion of legitimacy, all under Pearlman’s oversight.

The scheme wasn’t subtle. One Connecticut healthcare provider alone pocketed approximately $83,500 in illegal kickbacks, directly authorized by Pearlman, in exchange for prescribing Subsys over safer, cheaper alternatives. The drug, approved only for breakthrough cancer pain, was aggressively marketed to non-cancer patients through these illicit incentives — fueling misuse and endangering lives.

PEARLMAN didn’t just enable the fraud — he profited from it. His quarterly bonuses were tied to sales performance, meaning every illicit prescription boosted his personal paycheck. As prescriptions rose, so did the losses to federal healthcare programs — losses investigators say ran into the millions.

He faces one count of conspiracy to violate the anti-kickback statute, a crime punishable by up to five years in prison and a $250,000 fine. Though arrested in 2016 on a criminal complaint, Pearlman remains free on a $200,000 bond. The case, led by the U.S. Department of Health and Human Services Office of the Inspector General and the FBI — with DEA support — signals escalating federal scrutiny of pharma corruption.

U.S. Attorney Deirdre M. Daly emphasized that an indictment is not a conviction: ‘Charges are only allegations, and a defendant is presumed innocent unless and until proven guilty beyond a reasonable doubt.’ Anyone with information on healthcare fraud is urged to contact the Health Care Fraud Task Force at (203) 785-9270 or 1-800-HHS-TIPS. The investigation remains ongoing.