SAN FRANCISCO (KRON) — Two California digital health company executives were arrested on Thursday for allegedly making $100 million in revenue by funneling Adderall and Ritalin to illegitimate patients.
David Brody, the clinical president of Done, was arrested in San Rafael. Brody will make his first court appearance in a San Francisco courtroom on Thursday afternoon. Ruthia He, the founder and CEO of Done Inc., was arrested in Los Angeles.
Federal investigators said the duo conspired to provide easy access to stimulants over the internet in exchange for monthly subscription fees from patients. A grand jury indictment alleges that the conspiracy’s purpose was for Done executives to unlawfully enrich themselves by prescribing over 40 million pills to patients, many whom were never medically evaluated.
Adderall and Ritalin are prescription stimulant drugs used to treat attention-deficit hyperactivity disorder (ADHD).
Done was founded in 2020 as a Northern California-based digital telemedicine health company that operated on a subscription-based model. Done advertised that it provided online diagnosis, treatment, and refills of medication for ADHD.
In 2022 the FDA issued a nationwide notice of shortages in prescription stimulants, including Adderall and Ritalin. Legitimate patients with ADHD struggled to refill their prescriptions as pharmacies were unable to maintain supplies.
DEA Administrator Anne Milgram said, “Instead of properly addressing medical needs, the defendants allegedly made millions of dollars by pushing addictive medications. Any diversion of Adderall and other prescription stimulant pills to persons who have no medical need only exacerbates this shortage and hurts any American with a legitimate medical need for these drugs.”
Amphetamine-dextroamphetamine is sold generically and under a variety of brand names, including Adderall. Methylphenidate is sometimes sold under the brand name Ritalin. Pharmacists are required to exercise sound professional judgment, and to adhere to professional standards, when making a determination about the legitimacy of a controlled substance prescription.
Brody was a psychiatrist who maintained a DEA registration number and was authorized to prescribe controlled substances in California. Ruthia He owned, controlled, and operated Done.
Done’s prescribers wrote prescriptions for Done members “without an examination, sometimes based solely on a short video or audio communication and limited patient intake documents, or without any video or audio communication at all,” an indictment states.
According to the indictment, the scheme racked up thousands of members by spending millions of dollars on deceptive social media advertisements, as well as by intentionally targeting drug-seeking patients. The indictment was filed on Wednesday in U.S. District Court Northern District of California.
Some Done members overdosed and died, Guy Ficco of Internal Revenue Service Criminal Investigation said.
“Instead of prioritizing the health of their customers, He and Brody’s telemedicine company allegedly prioritized profits — more than $100 million worth — by fraudulently prescribing medications,” Ficco said. “This led customers to addiction, abuse, and overdoses, which the company tried to conceal by making false representations to the media in order to deter oversight by government agencies.”
As more health care needs are met through telemedicine, fraud schemes that recklessly exploit digital technologies will be prosecuted, federal officials said.
He and Brody are charged with conspiracy to distribute controlled substances, distribution of controlled substances, conspiracy to commit health care fraud, and conspiracy to obstruct justice. If convicted, He and Brody each face a maximum penalty of 20 years in prison.