Done Global Inc.’s founder and former CEO has been sentenced to six years in prison and ordered to pay a $1 million fine, and the company’s former clinical president has been sentenced to two years in prison and ordered to pay a $1 million fine, for their roles in a scheme that unlawfully distributed more than 37 million Adderall pills and defrauded health insurers of more than $12 million.
For telehealth companies, digital health platforms, and the management service organizations (MSOs) that support them, the case demonstrates that regulators will look past the prescribing clinicians to hold leadership accountable for platform design, compensation structures, clinical policies, and other corporate decisions that shaped how clinicians practiced.
What Happened at Done Global
Done Global marketed itself as a membership-based telehealth platform connecting patients seeking treatment for attention-deficit/hyperactivity disorder (ADHD) with qualified clinicians. In the “subscription-for-prescription” business model, patients paid a monthly fee, were diagnosed with ADHD in truncated initial visits, and received Adderall prescriptions that were renewed automatically.
To sustain that growth, Done Global allegedly paid clinicians up to $60,000 per month for approving high volumes of Adderall prescriptions. Done Global allegedly interfered with the clinicians’ professional judgment by limiting the length of initial evaluations to roughly half the length of a standard psychiatric intake and pressuring healthcare practitioners to prescribe stimulants to patients who did not exhibit ADHD symptoms or who were susceptible to serious side effects from the medication.
The company also allegedly terminated or refused to hire clinicians who resisted pressure to maximize prescription volume at the expense of patient safety. The platform’s auto-refill feature renewed prescriptions based on an automated message indicating that the patient wanted a refill. Some of these automated refills went to patients who had not seen a provider in years, who were under involuntary psychiatric holds, or who had died.
The company’s former clinical president signed prescriptions for nearly 400,000 Schedule II stimulant pills for more than 6,000 patients with whom he did not have a bona fide practitioner-patient relationship, including some he had never spoken with. He later admitted that each refill took him only 30 seconds because he never reviewed the patients’ medical records.
How Corporate Decisions Created Personal Criminal Exposure
The Department of Justice (DOJ) explicitly noted that its Health Care Fraud Unit’s investigation “reached beyond the individual clinicians writing the prescriptions to examine how corporate decisionmakers” structured incentives and protocols that drove illegal conduct. That distinction matters for every digital health founder, clinical officer, and MSO overseeing a prescribing platform.
Three design choices can drive exposure, illustrated by this case:
- Compensation tied to prescribing volume. Focusing on the number of prescriptions issued rather than clinical outcomes creates a direct financial incentive for providers to bypass independent clinical judgment.
- Platform features that minimize clinical oversight. Auto-refill functionality that renews controlled substance prescriptions without a corresponding clinical encounter may be viewed by regulators as a mechanism for facilitating unlawful distribution rather than merely a convenience feature.
- Clinical protocols disconnected from accepted standards. Compressing intake visits below what is clinically appropriate and failing to adequately apply the Diagnostic and Statistical Manual of Mental Disorders (DSM-5) criteria undercut the argument that prescriptions were issued for a legitimate medical purpose in the usual course of professional practice, the standard applied in controlled substance distribution cases.
In the Done Global case, the government also presented evidence at trial that the company submitted prior authorization requests to Medicare, Medicaid, and commercial payors, falsely representing that it followed DSM-5 diagnostic criteria, used urine drug screens, and had tried non-stimulant medications before prescribing Adderall.
When national pharmacy chains began blocking prescriptions from the company over safety concerns, the company created a second business entity to route around these blocks. This workaround was later presented as evidence of consciousness of wrongdoing rather than a defensible business pivot.
Compliance Lessons for Telehealth and MSO Leadership
For telehealth platforms, digital mental health companies, and the MSOs that manage clinical operations on their behalf, this case offers several compliance takeaways:
Clinical protocols should be established and monitored by clinicians, not dictated by growth targets.
Corporate leadership directing visit length, diagnostic thresholds, or refill decisions invites scrutiny under the Corporate Practice of Medicine (CPOM) doctrine, which, in many states, generally prohibits non-physicians from exercising control over clinical decision-making. If controlled substances are involved, these practices may also implicate the Controlled Substances Act.
Compensation structures for prescribers should be reviewed for volume-based incentives.
Per-prescription or per-refill payment models, or any structure that rewards speed over clinical thoroughness, may be scrutinized as evidence of an unlawful distribution scheme rather than a legitimate staffing arrangement.
Automated prescribing features carry regulatory risk.
Auto-refill, auto-approval, or algorithm-driven prescribing workflows for controlled substances should include meaningful clinician review of patients’ medical records and follow-up visits at defined intervals. Default renewal without clinician action should be avoided, as it can be treated as evidence of unprofessional conduct and expose providers to disciplinary action by state licensing boards for failing to meet the applicable standard of care.
Prior authorization and billing representations must be accurate.
Statements to payors about diagnostic methodology, screening protocols, or prior treatment history may independently create healthcare fraud exposure if they are false.
Document retention practices need scrutiny before, not after, a subpoena arrives.
Boards and general counsel should ensure that litigation holds and document retention policies that reflect applicable state medical-record retention requirements are in place well before any government inquiry materializes.
Clinical dissent and outlier growth are governance red flags.
When clinicians push back on prescribing volume or diagnostic thresholds, that should trigger an internal review, not termination. The same red flags should be considered during investor and board due diligence of digital health platforms, which should include a rigorous assessment of clinical protocols, prescriber independence, advertising practices, and regulatory compliance infrastructure. Clinicians and other staff with visibility into the compensation model or prescribing protocols are also potential whistleblowers. Retaliating against them, including through termination, increases the likelihood of a False Claims Act qui tam suit or an independent retaliation claim under 31 U.S.C. § 3730(h).
Conclusion
Telehealth and digital health platforms offering behavioral health services and access to controlled substances continue to fill a genuine access gap for patients. However, this case demonstrates that the DOJ’s Health Care Fraud Unit is examining the corporate architecture behind prescribing decisions, not just the prescriptions themselves.
Telehealth executives, clinical officers, and MSO leaders should ensure that clinical protocols are insulated from growth incentives, compensation structures reward clinical quality rather than volume, and payor representations are accurate and verifiable. By doing so, digital health companies can continue to expand access to care while materially reducing their exposure to liability for unlawful controlled substance distribution and healthcare fraud.
How Frier Levitt Can Help
Frier Levitt’s Healthcare and Life Sciences attorneys advise telehealth companies, MSOs, and digital health executives on structuring compliant clinical operations that can withstand regulatory scrutiny. If your organization operates in the digital health space, facilitates prescribing via telehealth, or faces questions about billing compliance or regulatory exposure, contact Frier Levitt today to speak with one of our regulatory attorneys.
