FTC launches probe into mental-health startup Cerebral – WSJ

ByValerie Winifred

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Signage is found at the Federal Trade Fee headquarters in Washington, D.C., U.S., August 29, 2020. REUTERS/Andrew Kelly/File Photograph

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June 14 (Reuters) – The U.S. Federal Trade Commission (FTC) has started an investigation into SoftBank-backed mental-wellness startup Cerebral Inc, the Wall Road Journal reported on Tuesday, citing a letter the antitrust body sent to the enterprise.

In the letter dated June 1, the FTC stated it was investigating whether or not the firm engaged in deceptive or unfair procedures connected to promoting or internet marketing of mental-health and fitness companies, according to the WSJ report.

The letter questioned Cerebral to preserve paperwork and also sought information connected to plans wherever the company continues to bill buyers a subscription charge right up until the buyer cancels, the report reported.

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Cerebral declined to confirm the FTC probe but claimed it is cooperating with the antitrust body.

The FTC was not instantly out there for comment.

The organization claimed in December it had elevated $300 million in a funding round led by SoftBank Eyesight Fund 2, lifting its valuation four-fold to $4.8 billion in significantly less than 6 months right after its very last capital raise. browse more

Cerebral provides psychological overall health expert services, which include session and prescription of medications, through its telehealth system.

Telehealth platforms’ prescriptions have been under scrutiny, with Walmart Inc (WMT.N) and CVS Wellbeing Corp (CVS.N) very last month saying they would cease filling prescriptions for controlled substances issued by telehealth startups Cerebral Inc and Accomplished Health. read additional

The WSJ final month reported that Cerebral had been issued a subpoena by federal prosecutors as aspect of an investigation into probable violations of the Controlled Substances Act.

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Reporting by Leroy Leo and Kannaki Deka in Bengaluru Enhancing by Shinjini Ganguli and Maju Samuel

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