Digital Health at a Crossroads: The Fallout from a $100M Adderall Fraud Scheme

Alex Yarijanian 00:00:00

Hey everyone, welcome to the Value Based Care Advisory Podcast. I'm your host, Alex Yarijanian.

Today I want to talk about a case that's going to really echo through digital health, payer contracting, and particularly behavioral health for some time to come.

This week, a federal jury convicted the founders of a telehealth startup for orchestrating one of the largest Adderall distribution and fraud schemes in United States history. More than 40 million stimulant pills, over $100 million in revenue, and a business model built on speed, volume, and zero clinical guardrails.

The headline isn't the crime here, you guys. The headline is what this means for the future of digital health—especially for those of us building responsible value-based models.

What Happened

A telehealth company built a hyper-aggressive direct-to-consumer pipeline. I’m talking:

• social media ads,

• instant online visits,

• easy prescriptions,

• automated refills.

The internal incentives were simple: grow patient volume, grow stimulant prescriptions, grow revenue. And in that environment, quality collapsed. Clinical oversight collapsed. Compliance disappeared.

Federal prosecutors described it as a pill mill dressed up as a telemedicine platform.

And now two telehealth founders are facing up to 20 years in federal prison.

So let this be a cautionary tale, and let founders hold other founders accountable. Because once an organization like this goes down, it becomes harder for all others to do business. You have to defend another organization’s behavior and explain how it is not what we are doing at this organization.

Why This Matters

Value-based care is the exact opposite of that. It’s based on alignment, clinical integrity, patient safety, and financial accountability.

So when a company breaks that alignment so spectacularly, it affects the entire industry:

• Payers tighten contracting.

• Regulators impose restrictions.

• Good telehealth companies get pulled into the same spotlight as bad actors.

If you're building anything in digital health—especially behavioral health, opioid use disorder, or anything involving controlled substances—understand this:

Speed is not scale.
Volume is not value.
Convenience is not care.

At VBCA, I talk a lot about the moral architecture of a healthcare business. You cannot build a sustainable clinical model on shortcuts.

This case is going to have cascading effects throughout the industry. We saw the same thing when Straight Arrow went down a couple years ago. With more dominoes falling, it becomes harder for other telehealth companies to do business in this space.

Being prepared is going to be important moving forward—both in your internal operations and when speaking with health plans who will absolutely be asking how you prevent something like this.

What to Expect

This case is going to shape several aspects of the business moving forward. First and foremost: perception.

Expect:

• more documentation,

• more audits,

• more prescribing oversight—especially if you’re using mid-level practitioners.

Have a clear process you can articulate. Because 20 years in prison is simply not worth it.

And if you play your cards right, you have nothing to be concerned about. Yes, your issues may scale as your organization scales, but if you build the right safeguards into your company’s DNA—unlike those convicted here—then what you seed now will scale in alignment with your intentions.

If your main incentive is to become a multimillionaire, then consider finance or another industry. Telehealth is going to become more and more restrictive, with increasing scrutiny. That is not the spotlight you want to be under.

And of course, all of this creates access issues:

• Less access for telehealth companies seeking to contract with health plans.

• Less access for patients who actually need these services.

There are plenty of good telehealth companies and only a handful of bad actors—but payers are tired. They’re tired of being burned.

I speak with many plan executives. They embrace telehealth, but now they’re looking for platforms with:

• real clinical governance,

• real outcomes data,

• real value-based infrastructure.

This actually benefits the good actors. Companies investing in longitudinal care, measurement-based outcomes, behavioral integration, and compliance are the ones that will grow.

Where We Go From Here

The future of digital health will be built on trust.

And trust is only possible when your clinical model and your business model are aligned—not in opposition or in conflict. This is why value-based care matters. It gives you a compass.

Ask yourself one question:

“Is what I’m doing right now in the best interest of the patients?”

You will instinctively know the answer. That question immediately tells you whether you’re on the right track—or drifting away from value.

When you’re accountable for total cost of care, patient safety, and outcomes, you cannot afford shortcuts. Your incentives pull you toward ethics, not away from them.

Final Message

If you're a founder, build your company like you're already under an audit.
If you're a payer, demand clinical governance before you demand scale.
If you're a provider, never let a business model erode your judgment.
If you're a patient, understand that real care has structure, boundaries, and integrity.

This case will be studied in business schools, medical schools, and compliance trainings for years. But if we’re smart, it will also become a turning point—where digital health shifts from speed to substance, from volume to value.

Because as long as business reality and clinical reality are misaligned, an organization is on a bad track. But when they align, the organization doesn’t just survive—it thrives.

Let this be a cautionary tale.
Let founders hold founders accountable.
Because when one organization goes down, we all feel the consequences.

Thank you for listening.
This is Alex from the Value Based Care Advisory Podcast.