Cerebral Replaces CEO Kyle Robertson, a Move He Calls Illegal

The Wall Street Journal reported in March that some of the company’s nurse practitioners felt pressured to prescribe stimulants to patients, and some pharmacies also blocked or delayed filling the prescriptions out of concerns about prescription practices of Cerebral and other providers. Cerebral said at the time that it doesn’t pressure clinicians to prescribe stimulants.

Mr. Robertson said in a memo to the board that directors encouraged the company to prescribe Adderall, which is used to treat attention deficit hyperactivity disorder, as part of its offerings. He also said that his successor, Dr. Mou, “discussed how we need to prescribe more,” according to a copy of the memo reviewed by the Journal.

Dr. Mou said in an interview that the board has told him he is CEO and he has no reason to doubt his new position.

“I stand by our clinical systems,” said Dr. Mou, who joined Cerebral in February 2021. “I’ve always stood by them from the second I came in and created this system. I stand by our quality. I stand by our safety.”

Asked about the assertion in the memo related to increasing prescriptions, Dr. Mou said he didn’t know the specific context of the accusations. He added that at his urging, the company began using UpToDate medical software, which features widely used treatment algorithms that assist clinicians with treating patients.

Cerebral’s statement on Wednesday didn’t address Mr. Robertson’s memo. The company has previously said that it has worked to provide evidence-based care, and that it sought to provide an essential service in the U.S., where demand for mental-health treatment far outstrips supply.

Directors who control the board formed a plan to replace Mr. Robertson after losing confidence in his leadership because of what they felt was the company’s aggressive strategy to diagnose and treat ADHD with stimulants, the Journal reported Tuesday. The board was also concerned about Mr. Robertson’s reluctance to follow advice from medical staffers who sometimes counseled a more conservative approach to treatment, according to people familiar with their thinking.

Cerebral’s prescription practices have drawn interest from federal prosecutors. The company said this month that its medical group received a subpoena from the U.S. attorney’s office for the Eastern District of New York as part of an investigation into possible violations of the Controlled Substances Act. Cerebral said at the time that it intended to cooperate with the investigation and that no regulatory or law-enforcement authority had accused it of violating any law.

Psychiatrists say that such stimulants can have significant benefits for people properly diagnosed with ADHD. The stimulants are classified as schedule 2 controlled substances by the federal government because of their potential for abuse, the same category as Vicodin and OxyContin.

Mr. Robertson co-founded Cerebral in January 2020 and the company grew quickly under his leadership, helped by rapid expansion in its business treating ADHD. Before the pandemic, clinicians were prohibited from prescribing stimulants without an in-person visit. The U.S. relaxed those rules in March 2020 for all schedule 2 substances due to the Covid-19 public health emergency.

On Monday, Mr. Robertson sent a message to employees announcing that Cerebral would stop prescribing almost all controlled substances. In his memo to the board Wednesday, he said he was locked out of all of his work accounts after sending the email and believed the board was trying to make it appear as if he wasn’t part of the decision to stop prescribing controlled substances.

“The board has repeatedly stated to me that we are underperforming our business goals and pressured me to find ways to increase revenues,” he said in the memo. He also wrote that board members have talked about their challenges with ADHD and believed it was “incredible” that Cerebral is treating people with the stimulant medications they need.

He also said in the memo that he has text messages of instances when Dr. Mou discussed what to do about “underprescribers.” Asked about that assertion, Dr. Mou said he didn’t know the specific context.

Cerebral investors are looking to Dr. Mou, who has overseen Cerebral’s treatment and prescription protocols, to take over as CEO in part because of his medical training, said these people. Mr. Robertson has no medical training.

A former executive at Cerebral alleged in a labor lawsuit that the company prescribed stimulant medications for “business reasons” and put profits and growth before patient safety. He said Mr. Robertson directed company employees to track the extent to which patient retention correlated with stimulant prescriptions. Cerebral said the allegations weren’t true and that it would vigorously defend itself.

Write to Rolfe Winkler at [email protected]

The Wall Street Journal reported in March that some of the company’s nurse practitioners felt pressured to prescribe stimulants to patients, and some pharmacies also blocked or delayed filling the prescriptions out of concerns about prescription practices of Cerebral and other providers. Cerebral said at the time that it doesn’t pressure clinicians to prescribe stimulants.

Mr. Robertson said in a memo to the board that directors encouraged the company to prescribe Adderall, which is used to treat attention deficit hyperactivity disorder, as part of its offerings. He also said that his successor, Dr. Mou, “discussed how we need to prescribe more,” according to a copy of the memo reviewed by the Journal.

Dr. Mou said in an interview that the board has told him he is CEO and he has no reason to doubt his new position.

“I stand by our clinical systems,” said Dr. Mou, who joined Cerebral in February 2021. “I’ve always stood by them from the second I came in and created this system. I stand by our quality. I stand by our safety.”

Asked about the assertion in the memo related to increasing prescriptions, Dr. Mou said he didn’t know the specific context of the accusations. He added that at his urging, the company began using UpToDate medical software, which features widely used treatment algorithms that assist clinicians with treating patients.

Cerebral’s statement on Wednesday didn’t address Mr. Robertson’s memo. The company has previously said that it has worked to provide evidence-based care, and that it sought to provide an essential service in the U.S., where demand for mental-health treatment far outstrips supply.

Directors who control the board formed a plan to replace Mr. Robertson after losing confidence in his leadership because of what they felt was the company’s aggressive strategy to diagnose and treat ADHD with stimulants, the Journal reported Tuesday. The board was also concerned about Mr. Robertson’s reluctance to follow advice from medical staffers who sometimes counseled a more conservative approach to treatment, according to people familiar with their thinking.

Cerebral’s prescription practices have drawn interest from federal prosecutors. The company said this month that its medical group received a subpoena from the U.S. attorney’s office for the Eastern District of New York as part of an investigation into possible violations of the Controlled Substances Act. Cerebral said at the time that it intended to cooperate with the investigation and that no regulatory or law-enforcement authority had accused it of violating any law.

Psychiatrists say that such stimulants can have significant benefits for people properly diagnosed with ADHD. The stimulants are classified as schedule 2 controlled substances by the federal government because of their potential for abuse, the same category as Vicodin and OxyContin.

Mr. Robertson co-founded Cerebral in January 2020 and the company grew quickly under his leadership, helped by rapid expansion in its business treating ADHD. Before the pandemic, clinicians were prohibited from prescribing stimulants without an in-person visit. The U.S. relaxed those rules in March 2020 for all schedule 2 substances due to the Covid-19 public health emergency.

On Monday, Mr. Robertson sent a message to employees announcing that Cerebral would stop prescribing almost all controlled substances. In his memo to the board Wednesday, he said he was locked out of all of his work accounts after sending the email and believed the board was trying to make it appear as if he wasn’t part of the decision to stop prescribing controlled substances.

“The board has repeatedly stated to me that we are underperforming our business goals and pressured me to find ways to increase revenues,” he said in the memo. He also wrote that board members have talked about their challenges with ADHD and believed it was “incredible” that Cerebral is treating people with the stimulant medications they need.

He also said in the memo that he has text messages of instances when Dr. Mou discussed what to do about “underprescribers.” Asked about that assertion, Dr. Mou said he didn’t know the specific context.

Cerebral investors are looking to Dr. Mou, who has overseen Cerebral’s treatment and prescription protocols, to take over as CEO in part because of his medical training, said these people. Mr. Robertson has no medical training.

A former executive at Cerebral alleged in a labor lawsuit that the company prescribed stimulant medications for “business reasons” and put profits and growth before patient safety. He said Mr. Robertson directed company employees to track the extent to which patient retention correlated with stimulant prescriptions. Cerebral said the allegations weren’t true and that it would vigorously defend itself.

Write to Rolfe Winkler at [email protected]