By Pat Anson, Editor

An Arizona drug maker that developed a powerful painkiller for cancer patients falsified records so the drug would be prescribed to non-cancer pain patients, possibly resulting in hundreds of overdose deaths, according to a new report by the Southern Investigative Reporting Foundation.

Subsys has FDA approval for breakthrough cancer pain, but Insys Therapeutics allegedly misled insurers into paying for the drug and encouraged off-label prescribing for patients suffering from conditions such as joint pain and post-traumatic stress disorder.

Subsys is a fentanyl based spray-on painkiller, said to be 100 times stronger than morphine.

The new report, headlined “Murder Incorporated,”  adds to the growing body of evidence and critical media reports about the aggressive business tactics of Insys Therapeutics. Last month CNBC accused the company of “putting profits before patients as it makes millions off your pain.”

"I've been investigating drug cases for about 15 years now, and the conduct that we saw in this case was among the most unconscionable that I've seen," Oregon Assistant Attorney General told CNBC. "There was harm done to patients on a level I'm not used to seeing."

Insys is under federal and state investigations in Oregon, California, Massachusetts, Connecticut, Arizona and Illinois. The company has settled a class action lawsuit in Oregon for $1.1 million and another in Arizona for $6.1 million.

The Southern Investigative Reporting Foundation has spent the past year investigating Insys and its business practices. It reported the company set up a special unit to help patients get prior authorization for Subsys prescriptions, often by falsely claiming they were medically urgent cancer diagnoses.

“Our findings suggest that the federal prosecutors are on to something. The prior authorization unit was set up to assist patients with complex insurance paperwork. Its value proposition was simplicity itself: the patient signs a few forms and Insys handles the messy paperwork. Patients would get the medicine, prescribers wouldn't have to scramble for a replacement and Insys would book thousands of dollars in revenue per prescription,” the report says.

Since Subsys was introduced in 2012, the FDAs Adverse Events Reporting System lists 203 deaths where Subsys was listed as the probable cause for triggering an adverse reaction. The pace of Subsys-related deaths is accelerating, with 52 deaths in the second quarter of this year alone.

“Depending on the dosage, one package of 30 Subsys sprays can cost between $900 and $3,000. Insys generates almost all of its revenue from Subsys. Last month the company reported over $91 million in revenue during the third quarter, beating estimates.

CEO Mike Babich resigned the day before earnings were released, saying he wanted to spend more time with his family.

“Insys is committed to developing products for the supportive care of patients through the use of its drug delivery technologies.  Insys takes patient safety very seriously and is committed to working with the health care community,” the company said in a statement. “Based on its interactions with patients and prescribers, Insys believes that the success of Subsys is directly attributable to the clinical benefits of its product.”