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Cerebral Execs Share New Reasoning for Shutting Down Programs, Cutting Staff

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Cerebral Inc. executives reportedly told employees that the company had grown too fast and was now slowing growth to put itself on a sustainable path.

On Monday, Cerebral’s top executives – including Chairman Jessica Muse and CEO David Mou – held town hall meetings with employees as part of the communications effort for its 20% workforce reduction. On Wednesday, Business Insider reported on those meetings.

Last week, Behavioral Health Business obtained an email sent to employees by Mou announcing the layoffs.

During meetings, executives reportedly told employees that Cerebral had taken advantage of temporary drug prescribing regulations to maximize patient acquisition and retention. But now demand has faltered following Cerebral’s decision to stop prescribing controlled substances after months of scrutiny, including a civil lawsuit by a former executive, federal investigations, a congressional investigation and insurers and pharmacies reassessing their work with Cerebral.

Cerebral announced that it will stop prescribing most controlled substances in May, effective October 15.

Muse, according to Business Insider, told a town hall meeting that the company spent more on advertising than it could earn.

Muse and Mou pointed to COVID-era federal flexibilities to prescribe certain drugs via telehealth as motivation to quit controlled substances. However, these federal flexibilities remain in place today.

While some Cerebral employees were critical of the company’s business approach, Muse, according to Business Insider, brushed off greed as a motive. She cited the practice under former and founding CEO Kyle Robertson for helping patients even though it was unprofitable.

The company is now focused on “very sustainable smart growth,” Muse said, according to Business Insider.

Additionally, Cerebral executives cited growing economic pressures as the reason the startup is making spending cuts. These include cutting staff, reducing the number of company retreats and cutting some programs such as care advice, coaching and weight management. A source confirmed these details to BHB.

Cerebral confirmed last month that it would stop offering care coaching and consulting services. At that time, he did not respond to further questions about the layoffs.

Management held three meetings on Monday – for corporate staff, support staff and clinical staff.

Business Insider also reported that Cerebral has dropped its clinical trials and plans to expand to the UK.

Robertson founded Cerebral in 2019. Mou replaced Robertson in May. Muse joined the company in April 2020 as COO and became chairman when Mou became CEO.

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