WASHINGTON – The U.S. Department of Justice (DOJ) announced today the arrest of Ruthia He, the founder and CEO of Done Global Inc., and David Brody, the clinical president of Done Health P.C., in connection with their alleged participation in a scheme to distribute Adderall over the internet, conspire to commit health care fraud, and obstruct justice.
He was arrested in Los Angeles and Brody in San Rafael, California. Both are expected to make their initial appearances today. The case is being investigated by Homeland Security Investigations (HSI) among other federal entities.
Secretary of Homeland Security Alejandro N. Mayorkas stated, “The individuals charged today allegedly disregarded the first rule of medical care—do no harm—in order to maximize profits, and there is no place for such fraud in our healthcare system.”
Attorney General Merrick B. Garland added, “As alleged, these defendants exploited the COVID-19 pandemic to develop and carry out a $100 million scheme to defraud taxpayers and provide easy access to Adderall and other stimulants for no legitimate medical purpose.”
According to court documents, He and Brody allegedly conspired with others to provide easy access to Adderall and other stimulants in exchange for payment of a monthly subscription fee. The indictment alleges that the conspiracy’s purpose was for the defendants to unlawfully enrich themselves by increasing monthly subscription revenue and thus increasing the value of the company.
Principal Deputy Assistant Attorney General Nicole M. Argentieri, head of the Justice Department’s Criminal Division, said, “These charges are the Justice Department’s first criminal drug distribution prosecutions related to telemedicine prescribing through a digital health company.”
He and Brody allegedly obtained subscribers by targeting drug seekers and spending tens of millions of dollars on deceptive advertisements on social media networks. They also allegedly intentionally structured the Done platform to facilitate access to Adderall and other stimulants.
DEA Administrator Anne Milgram said, “Instead of properly addressing medical needs, the defendants allegedly made millions of dollars by pushing addictive medications. In many cases, Done Global prescribed ADHD medications when they were not medically necessary.”
He and Brody allegedly persisted in the conspiracy even after being made aware that material was posted on online social networks about how to use Done to obtain easy access to Adderall and other stimulants, and that Done members had overdosed and died.
Executive Associate Director Katrina W. Berger of Homeland Security Investigations (HSI) said, “Today’s announcement should serve as a reminder that it is only a matter of time before anyone engaging in fraudulent activity is caught and brought to justice.”
Chief Guy Ficco of IRS Criminal Investigation concluded, “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 like Adderall and other stimulants.”
He, Brody, and others also conspired to defraud pharmacies and Medicare, Medicaid, and the commercial insurers to cause the pharmacies to dispense Adderall and other stimulants to Done members in violation of their corresponding responsibility; Medicare, Medicaid, and the commercial insurers to pay for the cost of these drugs; and Done members to continue to pay subscription fees to Done. He and others allegedly made false and fraudulent representations about Done’s prescription policies and practices to induce the pharmacies to fill Done’s prescriptions. As a result, Medicare, Medicaid, and the commercial insurers paid in excess of approximately $14 million.
The indictment also alleges that He and Brody conspired to obstruct justice after a grand jury subpoena was issued to another telehealth company and in anticipation of a subpoena being issued to Done, including by deleting documents and communications, using encrypted messaging platforms instead of company email, and ultimately failing to produce documents in response to a subpoena issued to Done by a federal grand jury.
If convicted, He and Brody each face a maximum penalty of 20 years in prison on the conspiracy to distribute controlled substances and distribution of controlled substances counts.
