Federal prosecutors have charged the CEO and chief medical officer of Done Global, a telehealth company that distributes stimulant drugs to thousands of patients in the United States, with fraud in an alleged $100 million scheme to provide “easy access ” to Adderall and other stimulants.
Ruthia He, the founder of Done Global, was arrested Thursday in Los Angeles on charges of engaging in the distribution of Adderall over the Internet, submitting false and fraudulent claims for reimbursement and obstruction of justice, the Justice Department said in a press release David Brody, the company's clinical president, was arrested in San Rafael, California, on the same charges.
“They generated more than $100 million in revenue by arranging the prescription of more than 40 million pills,” Senior Assistant Attorney General Nicole M. Argentieri, chief of the Justice Department's Criminal Division, said in the statement. and added that these were from the Justice Department's “first criminal prosecutions for drug distribution related to telemedicine prescribing through a digital health company.”
US Attorney General Merrick Garland said in a statement that the prescribed drugs often had “no legitimate medical purpose.”
Court documents allege that he and Brody prescribed Adderall and other highly addictive drugs to patients who purchased a monthly subscription through the company's platform. They are accused of targeting those looking for drugs with “misleading ads”. They are also accused of structuring the company's platform “to facilitate access to Adderall and other stimulants, including by limiting the information available to Done's prescribers, instructing Done's prescribers to prescribe Adderall and other stimulants even if the Done member doesn't qualify and forcing them to do so the initial encounters would be less than 30 minutes.”
“The indictment alleges that the purpose of the conspiracy was to enrich the defendants illegally by, among other things, increasing monthly subscription revenue and thereby increasing the value of the company,” the Department of justice
Done Global is accused of prescribing ADHD drugs when they were not medically necessary for numerous patients, the statement said. Once patients purchased the monthly subscription, according to court documents, the platform set up an “autofill” feature that allowed subscribers to opt-in to automatically generate a message asking for a top-up each month.
Court documents alleged that Done attempted to “use the compensation structure to discourage follow-up” of medical care by refusing to “pay Done's prescribers for any physician visits, telemedicine consultations, or time spent on seeing patients after an initial consultation and instead paying based solely on the number of patients who received prescriptions.”
Court documents alleged that even after he and Brody had learned how easy it was to get access to stimulants and that “members had overdosed and died,” the company continued to persist in its methods. The executives also conspired to defraud pharmacies, Medicare, Medicaid and other insurers, court documents alleged.
The Centers for Disease Control and Prevention issued an alert late Thursday warning public health officials, doctors, patients, their families and caregivers of potential disruption from the indictment. “An outage involving this large telehealth company could affect as many as 30,000 to 50,000 patients age 18 and older in all 50 US states,” the alert said.
Done launched two years ago, according to the company's website, as a “passion project to help friends, coworkers and loved ones struggling to access mental health care.”
Members pay a monthly fee of $79 to access psychiatric board-certified medical professionals on the platform and other resources that help ADHD patients, the website says. It costs $199 to start a business membership.
Done Global did not immediately respond to a request for comment from CBS News. The website remains operational and the company has not clarified whether it will continue operations. The Department of Justice urged Done's patients or medical professionals involved in the alleged illegal activity to report the conduct to the DEA hotline.
He and Brody face a maximum sentence of 20 years in prison.
