How Telehealth Execs Engineered a $100 Million Fraud Scheme That Gave Easy Access To Adderall

The founder-CEO and clinical president of a digital telehealth company has been arrested and charged for running a $100 million scheme that provided easy access to Adderall and other restricted drugs. In a press release, the Justice Department said the executives of Done Global, a San Francisco-based start-up, used to run the scheme which led to a nationwide shortage of Adderall. Ruthie He (founder and CEO) and David Brody, the company's clinical president were both arrested in California.

Here's How Done Made $100 Million By Selling Adderall

Done Global, an online telehealth website, became popular during the pandemic for serving as an online portal to obtain Adderall by paying a monthly subscription fee. Before the pandemic hit, the company was allegedly struggling to make money, as per the DOJ.

At the time of crisis, the company began taking advantage of patients. As per the court documents, He and Brody conspired with others to provide easy access to Adderall and other stimulants to patients.

The company began hastily signing up people for a monthly subscription that offered an “auto-refill” function for the medication. The function allowed Done subscribers to elect to have a message requesting a refill every month.

Done allegedly prescribed and arranged for over 40 million pills of Adderall and other stimulants, which generated about $100 million in revenue for the company. The indictment alleges that the scheme was perpetrated by the executives to unlawfully enrich themselves and increase the value of the company.

Targeting People Through Social Media 

He and Brody allegedly spend tens of millions of dollars on deceptive advertisements on social media. They targeted drug seekers through social media and intentionally structured the Done platform to facilitate access to Adderall and other stimulants.

The execs allegedly persisted in the conspiracy even after they were made aware of the fact that the material posted on social media showed how to use Done to get easy access to Adderall and other stimulants. The two executives allegedly knew that Done members had also overdosed and died.

Despite this, they allegedly concealed and disguised the conspiracy by making fraudulent representations to media outlets to forestall government investigations and action and convince third parties to continue doing business with them, the court documents mentioned.

Consequences of the Easy Adderall Scheme

The platform limited access to information available to Done prescribers. They also instructed Done prescribers to prescribe Adderall and other stimulants even if the member did not qualify. As per the court documents, Done mandated that initial encounters/consultations with patients should be under 30 minutes.

In a USA Today report, Dr Craig Surman, director of an Adult ADHD clinical and research program at Massachusetts General Hospital and Harvard Medical School professor, stated that a full assessment for ADHD is supposed to take an hour and a half. The easy access and overprescribing of Adderall also added to the nationwide shortage of the drug. 

Furthermore, He used the auto-refill and the company structure to discourage follow-ups. The platform refused Done prescribers any medical visits, telemedicine consultation, or added care for patients after the initial consultation.

According to Dr Surman, the risks and benefits of the treatment with the medication also need to be monitored and reevaluated over time. This raises red flags about the no follow-up policy.

According to Surman, the limited assessments prevented prescribers and the company from screening out people for whom the treatments were unhealthy. He also noted that since Adderall and other stimulants have a high market value, they could be illegally resold as well.

“Instead of properly addressing medical needs, the defendants allegedly made millions of dollars by pushing addictive medications. In many cases, Done Global prescribed ADHD medications when they were not medically necessary,”  DEA Administrator Anne Milgram said in the DOJ press release.

Insurers, Medicare, Medicaid Defrauded

The two execs also conspired to defraud pharmacies and Medicare, Medicaid, and the commercial insurers to dispense the medications to Done members. As a result, Medicare, Medicaid, and the commercial insurers were made to pay approximately $14 million, for facilitating the sales.

As per the DOJ, this is the first time that anyone has been charged with operating an illegal drug distribution scheme through a telemedicine company.

If convicted, He and Brody each face a maximum of 20 years in prison on the charges of committing conspiracy to distribute controlled substances and distribution of controlled substances counts.