Digital mental health company Cerebral announced a round of layoffs planned for July 1.
The company told Bloomberg News, which first broke the story, that the layoffs are an effort to focus on quality and make the company more efficient. The number of employees that will be laid off has not been announced.
This news comes as Cerebral faces increasing public scrutiny for its prescribing practices, as well as a Department of Justice (DOJ) investigation for a potential violation of the Controlled Substance Act.
The company has made a number of changes in leadership within the last few months. Its founder, Kyle Roberston, stepped down as CEO and was replaced by Chief Medical Officer David Mou. The company also named Jacqueline Kniska chief ethics and compliance officer in May.
New York-based Cerebral was founded in 2019 and has since raised $462 million in funding. Its Series C funding round brought its valuation to $4.8 billion.
The company offers virtual visits and counseling, as well as medications for a number of conditions.
The company has undergone a number of changes in recent months. Following a wave of criticism over its ADHD medication prescribing practices, the company announced that it would no longer prescribe ADHD medications to new patients in May and end prescribing to existing patients in the Fall.
Prior to this announcement, Truepill stopped filling Cerebral prescriptions of Adderall, according to a Wall Street Journal report.
More recently, CVS Health (NYSE: CVS) and Walmart (NYSE: WMT) announced that they would no longer fill controlled substances for Cerebral. This includes ADHD medication as well as its medication assisted treatments for substance use disorder.
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