CEO of digital health company arrested for fraud

On Thursday, June 13, the Office of Public Affairs of the U.S. Department of Justice (DOJ) announced in a press release the prosecution of the DOJ's first criminal drug distribution. Ruthia He, founder and CEO of California-based digital health company Done Global Inc., and its clinical president, David Brody, were arrested Thursday for allegedly participating in a scheme to provide Adderall online and submitting drug claims. fraudulent reimbursements.

According to the press release, court documents indicated that he and Brody allegedly conspired to provide easy access to Adderall as well as other stimulants. Drug seekers have been targeted with misleading advertisements on social media. By limiting information to Done's prescribers, drugs were prescribed to members, who paid a monthly subscription fee, even if they were not eligible. Refills were put on auto-refill to maximize profits, and follow-ups were discouraged by refusing to pay Done's prescribers for consultations after the first appointment.

“The indictment alleges that the purpose of the conspiracy was for the defendants to illegally enrich themselves, including by increasing monthly subscription revenue and thereby increasing the value of the company. Done allegedly arranged the prescription of more than 40 million Adderall pills and other stimulants, and obtained more than $100 million in revenue,” according to the press release.

“As the indictment alleges, the defendants facilitated access to Adderall and other stimulants by exploiting telemedicine and spending millions on deceptive social media advertisements. They generated more than $100 million in revenue by arranging the prescription of more than 40 million pills,” noted Principal Assistant Attorney General Nicole M. Argentieri, chief of the DOJ’s Criminal Division, in a statement.

“As has been alleged, these defendants exploited the COVID-19 pandemic to develop and carry out a $100 million scheme to defraud taxpayers and provide easy access to Adderall and other stimulants without a legitimate medical purpose,” Attorney General Merrick B. Garland said in a statement. .

“In 2022, the U.S. Food and Drug Administration (FD) issued a shortage advisory for prescription stimulants, including Adderall. Any diversion of Adderall and other prescription stimulant pills to people who have no medical need only exacerbates this shortage and harms every American with a legitimate medical need for these medications,” said Anne Milgram, administrator of the Drug Enforcement Administration (DEA), in a press release.

The press release states that he and Brody allegedly persisted in the program even after information was posted on social media about how to use Done to gain easy access to stimulants and that Done members overdosed and had died. He, Brody, and others also conspired to defraud pharmacies, Medicare, Medicaid, and commercial insurers in order to trick pharmacies into dispensing stimulants. As a result, Medicare, Medicaid and commercial insurers paid more than an estimated $14 million.

“If convicted, he and Brody each face a maximum sentence of 20 years in prison for conspiracy to distribute controlled substances and for distribution of controlled substances. The DEA, HHS-OIG, HSI, and IRS Criminal Investigation are investigating the matter,” according to the press release.