(Bloomberg) — Mental-health startup Done touted its relationship with a former congressman and a Stanford psychiatrist and professor in a pitch sent to potential investors. But those people say their role has been misrepresented and exaggerated by the company.
In an April document for possible funders, Done listed former Michigan Representative Bart Stupak on a page titled “Advisers & Investors,” according to a copy of the document viewed by Bloomberg.
But in a statement to Bloomberg, Stupak said that the presentation substantially misrepresented his role. Stupak said he is “not an adviser nor an investor” for Done, and that he only “handles government relations,” for the company, which grew rapidly last year by connecting patients online with medical staff who could prescribe ADHD medications such as Adderall. The company has come under scrutiny for making those drugs, which can be abused, easier to obtain than some experts say they should be.
Done didn’t dispute the existence of the documents or that they may have been shared but called them “drafts.” There is no indication on the documents that they are not final.
On the same “Advisers & Investors” page, Done also listed Nina Vasan, a professor at the Stanford School of Medicine who founded the university’s lab focused on mental health innovation. Like Stupak, Vasan disputed Done’s description of her.
“I am not, nor ever was, an adviser to Done,” she said in an interview. “Advertising me as such is inappropriate and makes me uncomfortable. I have not had anything to do with the growth and development of that company.”
Vasan, who is the chief medical officer at a different mental health startup called Real, did invest in Done’s seed round in 2020, according to people familiar with the matter. But the amount was in the tens of thousands of dollars and represented less than 1% of the total $3 million raised, the people said.
Pitch Document
Along with the “Advisers & Investors” slide, the April document includes the company’s operating metrics, a list of key executives, industry statistics, an outline of the platform’s offerings and a timeline of projects planned for 2022 – all standard parts of a startup’s pitch to funders. It was provided to Bloomberg by a potential investor who received it, and it’s not clear how widely it was distributed outside the company or how many other investors, if any, got copies.
Done said there are “no official corporate documents” that describe Stupak and Vasan’s roles in the way the pitch obtained by Bloomberg shows.
“Any documents or presentations that state so are inaccurate,” the company said in a statement. “Many documents and presentations have been distributed in draft form that have no legal or binding authority to our company or corporate structure.”
As online ADHD startups have faced scrutiny, some have exited the business. One Done competitor, Cerebral, said earlier this year that it will no longer enable prescriptions for controlled substances used to treat ADHD, such as Adderall and Ritalin. Another competitor, Ahead, previously announced plans to wind down and stop offering services to existing patients as of last month. Many of those patients have since turned to Done, Bloomberg has reported.
The April presentation projected that with additional funding, Done could reach a $100 million annual run rate and “become the predominant market leader” this year. As part of its plan, Done listed launching partnerships with schools, hospitals and corporations, as well as incorporating in-network insurance coverage.
While Done describes the documents as inaccurate, it’s not the first time the company has called Vasan a funder. In fact, an earlier version of the company’s pitch materials that was shared with different potential funder in April 2021 described Vasan as a “notable” investor. The person who shared the 2021 presentation didn’t give money to the company and asked not to be named.
High-Profile Names
Along with Vasan’s Stanford pedigree, Stupak’s career history lends its own credibility. In 2000, his son died by suicide, an event the former Democratic congressman has said may have been linked to the prescription drug Accutane, which comes with warnings about mental-health side effects. The drug’s maker disputed those claims at the time.
During almost two decades in Congress, Stupak became an outspoken voice on drug safety, in particular around online prescribing. He was the lead sponsor of the Ryan Haight Online Pharmacy Consumer Protection Act, a 2008 law that imposed rules around the prescription of controlled substances through telemedicine. The law is named after an 18-year-old man who died of an overdose of Vicodin that had been prescribed to him via a telemedicine appointment. It requires clinicians to hold at least one in-person appointment prior to writing a prescription. That requirement was waived during the Covid-19 public health emergency.
Done’s showcasing of high-profile, influential figures in the health-care sphere in a presentation to an investor comes at a time when the embattled startup is facing intensifying scrutiny from clinicians and customers who say the company’s rapid growth has come at the expense of patient care. The change to the Haight Act during the pandemic fueled Done’s and other similar companies’ growth by letting doctors and nurses working with the companies write prescriptions for controlled substances, including stimulants used to treat ADHD, which is also known as attention-deficit/hyperactivity disorder. As Covid-19 wanes, some lawmakers have urged regulators to extend the waiver.
Stupak, now a partner at Washington-based law firm Venable LLP, first registered as a lobbyist for Done in January and has received $100,000 in fees from the company so far this year, according to disclosures filed with the House and Senate. In addition to both chambers of Congress, Stupak engages the Department of Justice and the Drug Enforcement Administration in lobbying activities specifically related to the Ryan Haight Act on behalf of Done, according to the filings.
Done’s subscription-based service connects patients seeking help with ADHD with nurse practitioners who perform virtual evaluations and write prescriptions. Customers pay $199 for an initial appointment and $79 in subsequent months. Since its founding in 2020, Done has amassed over 30,000 members, according to people familiar with the company’s operations. The startup has parlayed its growth to expand into new revenue streams, including a pediatrics version of its service for parents looking to treat their children’s ADHD, fetching a higher monthly fee of $125.
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