You've probably seen or heard them. Glossy television, radio or internet ads featuring a down-to-earth, millennial-looking young man or perhaps a famous rapper. At first blush, these are just others in a growing line of Bay Area startups pitching products directly to you, the consumer. They have all of the hallmarks of other direct-to-consumer retailers. They bypass traditional marketplaces, saving you money because their products are not name brands and there's no middleman. In fact, they look just like those commercials for the world's most innovative suitcases, or the most perfect bed sheets or the slickest tooth brushes.

But these are not vendors of every day consumer products. These are online prescription drug retailers, selling targeted products like sildenafil (generic Viagra), which gives those with—ahem—performance difficulties, assistance in that area, or maybe minoxidil, a hair growth drug.

Pay a fee, answer some online questions, submit a copy of your driver's license and a photograph, and away you go.

“These are low risk drugs,” some say, “you don't even need a prescription for these in Europe.” Others note that startup companies like Uber and AirBNB acted in knowing violation of antiquated rules and regulations, with an eye toward fomenting public support to change those rules and regulation. As a corporate health care and regulatory attorney with substantial experience advising digital health businesses, I cringe when I hear this. Something feels inherently different between ride sharing and the broad universe of prescription drugs. Prescription drugs require a prescription for a reason.

Digital Health

The terms “digital health” or “telehealth” or “telemedicine” mean many things to many people. To some, the tools of technology are vehicles to diagnose faster, and further away, to treat quicker and better, to keep nonemergencies out of expensive emergency rooms, and to get actual emergencies triaged faster. High-resolution imaging, data analytics, machine-based learning, artificial intelligence and other technologies offer new solutions to old problems, or identify problems no one realized existed. This kind of digital health is the wave of the future.

But to others, these tools are used for something less new and innovative: to find a market for and sell prescription drugs. For some of us practicing in this digital health world, these latter enterprises are causing concern.

The Business Model

These are not singular “companies” in the traditional sense: they are ecosystems of business entities, working together and bound by a series of contracts to provide consumers with a quick and efficient experience. The primary company owns or licenses all of the forward-facing technology and intellectual property, including the website and platform which hosts the medical consult. It contracts with one or more “friendly” professional associations or professional corporations which engage medical providers licensed to practice across the United States. It also affiliates with one or more preferred pharmacies which fulfill the orders and mail the prescriptions directly to the patients.

Broad marketing campaigns draw patients to the website, where they flow seamlessly through a brief online “medical consult.” Typically the consult includes a series of questions, the answers to which are stored and forwarded to a medical doctor for review, along with a copy of the patient's driver's license and a recent photograph. More often than not this results in a prescription and a confirmation that the drugs are in the mail. The entire process can be swift. Although every business is different, it is common for the drug retailers to collect the fee from the patient at the outset, even before the medical visit has occurred, then pay the medical doctor for the online consult and the pharmacy for the drugs, retaining the remainder as profit.

One troubling issue is that almost every state—including Florida—has a regulation or law that prohibits generating a prescription based solely on a “questionnaire,” a term that is almost never defined. There's also the concept that states typically require that retailers selling prescription drugs to their residents be licensed pharmacies, rather than technology startups founded by 30 year old tech entrepreneurs (having the order “fulfilled” by a licensed pharmacy does not change the fact that the patient is buying the product directly from the online retailer, and looking to the retailer for instruction and guidance with respect to the purchased product).

Mind you, not all of these businesses are the same. There are legal ways for third parties to market prescription drugs for a fee. Likewise, unlicensed persons and companies can legally perform and be compensated for performing an array of administrative services to facilitate these types of businesses. And, of course, licensed pharmacies can sell prescription drugs at retail.

The bottom line is that consumers should be aware of the risks when they buy prescription drugs for vanity or recreation and not mistake them for harmless consumer products and attorneys should caution clients about the risks inherent in operating these businesses. In this writer's view, assuming that the rules and regulations will catch up to innovation is not a sound strategy in the health care realm.

Marc I. Goldsand is the founder of Goldsand Law in Miami. He represents provider groups and health care entrepreneurs in corporate and regulatory matters with emphasis on digital health and technology.