Digital mental health company Cerebral is under investigation by the Federal Trade Commission, in keeping with a letter despatched by the company and reviewed by the Wall Street Journal.
According to WSJ, the FTC is investigating whether or not Cerebral was concerned in misleading or unfair advertising and marketing or promoting practices, together with elevating questions on applications the place the digital mental health company continues to invoice sufferers for subscriptions till they cancel.
Patients informed the WSJ that they had hassle canceling their accounts or receiving refunds once they did not use providers.
In an announcement to MobiHealthNews, Cerebral stated it’s cooperating with the FTC.
WHY IT MATTERS
The company has confronted a wave of scrutiny over the previous a number of months over its prescribing practices for drugs like Adderall, its social media advertising and marketing and its remedy of staff.
It’s additionally going through one other investigation for potential violations of the Controlled Substances Act. Cerebral confirmed it had obtained a grand jury subpoena from the U.S. Attorney’s Office for the Eastern District of New York in early May.
“To be clear, at the moment, no regulatory or regulation enforcement authority has accused Cerebral of violating any regulation,” the company wrote in an announcement on the time.
Cerebral has since begun halting most prescriptions of managed substances and changed its former CEO and cofounder Kyle Robertson. The company additionally lately introduced a metamorphosis plan that features reviewing its medical and advertising and marketing practices.
But the digital mental health company, which raised $300 million in funding late final 12 months, is beginning to face blowback from payers. Forbes reported final week Aetna is canceling its contract with Cerebral in August. Optum stated it is going to additionally take away Cerebral from its behavioral health community by the tip of the summer time.
At the American Telemedicine Association Association’s Annual Conference & Expo in early May, Dr. David Mou, now Cerebral’s CEO, stood by their high quality, however acknowledged that they had made some errors in advertising and marketing.
https://www.mobihealthnews.com/information/wsj-digital-mental-health-company-cerebral-under-investigation-ftc
