DOJ dropped an anvil on Cerebral’s head Friday night. Last week’s reports on the Drug Enforcement Agency (DEA) investigation of telemental health provider Cerebral were confirmed on Friday with the official notification that the US Attorney’s Office for the Eastern District of New York had subpoenaed the company as part of their investigation into possible violations of the Controlled Substances Act. According to the Wall Street Journal, the subpoena was issued to Cerebral Medical Group, the corporation it uses to contract with clinicians and provide healthcare services. The company is fully cooperating with the investigation by the Department of Justice, which includes turning over records pertaining to their prescribing of controlled substances such as Adderall and Xanax. This has been reported by FierceHealthcare which is citing (paywalled) Insider.
Last week, Cerebral announced that it would stop prescribing controlled substance prescriptions for new ADHD patients as of 9 May. However, they would continue prescribing controlled substances for other mental health conditions, according to a memo from their chief medical officer to their clinician network.
Cerebral’s Saturday statement in response to the subpoena maintains (from FierceHealthcare):
“To be clear, at this time, no regulatory or law enforcement authority has accused Cerebral of violating any law”
“Cerebral has dedicated significant time, energy, and resources to ensuring that its policies and procedures regarding the prescription of controlled substances and other medications both are medically appropriate and comply with all applicable state and federal law,” the statement also said. “As a responsible company, Cerebral is continuously improving its systems and practices. The foundation of this company is built on evidence-based, ethical, and compliant practices so that our patients can receive the highest quality of care and achieve the best clinical outcomes.”
The company has done well with the increased demand for mental health services provided via telehealth including remote evaluating and prescribing. In December, their $300 million Series C raise boosted their valuation past $4.8 billion.
Darkening this rosy picture is, as TTA noted last week, that a former VP of product and engineering, Matthew Truebe, has sued Cerebral for wrongful dismissal. According to him, the company put growth before patient safety, including overprescribing medications for ADHD. Other reports indicate that the DEA interviewed other former Cerebral nurse practitioners who felt pressured to prescribe ADHD medication after a short video call. The Verge
Cerebral has also gained notoriety for dodgy advertising claims pertaining to ADHD and other conditions. In January, advertising on TikTok and Instagram was pulled for claims that obesity is “five times more prevalent” among adults with ADHD, and stated that getting treatment for the mental health disorder could help patients “stop overeating.” These followed inquiries by Forbes and NBC News. Also pulled was their Facebook advertising around prescribing Type 2 diabetes medications, GLP-1 agonists, as a “wonder drug” for weight loss.
Will this put a damper on the burgeoning area of telemental health and remote prescribing? Stay tuned. Also Becker’s.