At the onset of the pandemic the U.S. Drug Enforcement Agency temporarily changed a rule to allow doctors to prescribe controlled substances like stimulants and opioids via telemedicine without an in-person visit.
A number of telemedicine startups capitalized on the rule to attract customers by being able to prescribe hard-to-get ADHD medication like Adderall with just a 30-minute video call and heavily marketed their services on social media.
But now that the Biden administration is ending the Covid-19 public health emergency, the rule allowing prescribing controlled substances will also be reversed, and telemedicine companies that built their business models on prescribing these medications must scramble to find a new business model.
Done Global Inc., a San Francisco startup focusing on treating ADHD via telemedicine, says it has opened 45 in-person clinics across the country to prepare for the DEA rule change and is opening 40 more over the next two months. It also has partnered with 200 providers nationally that can handle the in-person needs of its business in order to build up its new hybrid model.
Patients at Done will be able to visit these locations to continue receiving care from the company, and the frequency of in-person visits required will depend on state regulations, according to Sean Arroyo, the company's senior executive in charge of operations. The company plans to encourage patients to visit in-person every six months, however, some states require in-person visits every 90 days.
Done users that are not within close vicinity of a clinic can also participate in a referral program with their primary care provider where Done refers treatment options to a person's regular doctor and the doctor can prescribe the medication.
"This has become a hybrid platform, because it provides patient optionality," Arroyo said. "It has been difficult to build and took quite a bit of time, but we think this is industry leading in providing patients the best selection to meet their needs."
The company is one of the last telemedicine startups prescribing telemedicine after rival Cerebral announced it was temporarily suspending the practice, and rival Ahead shut down.
Both Cerebral and Done were accused by reports in the Wall Street Journal and Bloomberg of pressuring their clinicians to provide more stimulants in an effort to grow its customer base. The Business Journals wrote about the trend last year.
"I think we're an easy target, but ultimately, these platforms are actually opening up the availability for care in a ubiquitous manner for the first time due to the shift and regulations," Arroyo said. "What we've actually done is we've exposed across the board the mental health needs of the country."
Done has raised an undisclosed amount from Offline Ventures, Craft Ventures, and F7 Ventures.
Done and Cerebral are also under investigation by the Justice Department for their practice of prescribing controlled substances via telemedicine and have submitted information for subpoenas.
"We welcome any inquiry to business to be able to show that what we're doing is an absolutely needed application across the U.S.," Arroyo said. "I think this is a way for them to understand what's going on, however, I think that the better way to go about this would have some kind of a committee to help them regulate and to come together and talk about what the industry actually needs."
