Cerebral is under federal investigation

Cerebral, the mental health digital unicorn, said on Saturday that the federal government is investigating “possible violations of the Controlled Substances Act.”

The company said it received a grand jury subpoena from the U.S. Attorney’s Office for the Eastern District of New York on May 4.

In a statement to Business and technology of digital healthCerebral stated that no regulatory or law enforcement agency has charged Cerebral with violating any law at this time. Cerebral said it would cooperate with the investigation.

business insider May 4 reported that the US Drug Enforcement Agency was investigating Cerebral and talking to former employees about how it was prescribing controlled substances to treat attention deficit hyperactivity disorder (ADHD). Cerebral said at the time, “We don’t speak for the DEA, but we don’t know anything beyond the normal interactions within the normal course of our operations.”

Company Policy on ADHD Medications called a lawsuit two weeks ago. In the complaint, Matt Trube, Cerebral’s former vice president of products and engineering, alleges that the company sought to increase customer retention by prescribing ADHD stimulants to 100% of its patients. The lawsuit also alleges that Cerebral had 2,000 duplicate shipping addresses, suggesting that patients created multiple accounts to obtain additional drugs from prescribers.

Cerebral denied the allegations.

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Previously, The Wall Street Journal pIt was reported that national pharmacy chains were looking into the prescribing practices of Cerebral and another Done Health company. The article claimed that CVS Health, Walmart and Walgreens have reportedly blocked and delayed some Cerebral and Done Health prescriptions due to issues with Adderall overprescribing. Online Pharmacy, TruePill confirmed Magazine that he suspended the prescription for Adderall and other controlled substances.

Cerebral and Done Health separately contested the report and said the delays in prescribing medications were due to administrative reasons related to insurance companies and drug availability. During the public health emergency, the Drug Enforcement Agency has waived requirements for prior in-person evaluation of controlled substance prescriptions via telemedicine.

Cerebral secures $300M funding round in December and is valued at nearly $5 billion.

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