The Federal Trade Commission (“FTC”) has reached a settlement with NextMed (also known as Southern Health Solutions, Inc.), resolving allegations that the telehealth company misled consumers through deceptive advertising, billing, and cancellation practices tied to weight-loss programs involving GLP-1 medications such as Wegovy and Ozempic. The FTC also named the company’s founder, Robert Epstein and CEO, Frank Leonardo III, in its Complaint. This case underscores how aggressive marketing in the booming prescription weight-loss space can cross into unlawful misrepresentation, eroding consumer trust and causing financial harm.
According to the FTC, NextMed advertised monthly membership fees — often in the $138 to $188 range — that seemed to include prescriptions for these drugs. However, the reality was very different:
- The advertised prices did not include the cost of the GLP-1 medication itself — which can exceed $1,000 per month without insurance.
- Consumers were not clearly told that necessary lab work and medical consultations required to obtain a prescription were extra costs.
- Important details, like a 12-month minimum membership commitment and early termination fees, were buried or omitted.
The FTC’s complaint went well beyond pricing concerns. Investigators found that NextMed:
- Made unsubstantiated claims about how much weight customers typically lost in the program.
- Used fake testimonials and before-and-after photos from people who had never participated.
- Posted fabricated positive reviews on consumer sites and suppressed negative reviews — including offering incentives like gift cards for customers to remove critical feedback.
- Failed to obtain informed consent before charging consumers’ payment methods, and delayed or ignored cancellation and refund requests.
Rather than letting the case drag on for years in court, NextMed agreed to a consent order with the FTC. Under the settlement:
- The company and its principals must pay $150,000, which is expected to be used to provide refunds to harmed consumers.
- They are prohibited from making misleading claims about service costs and must clearly disclose what is — and isn’t — included in advertised prices.
- They must substantiate any claims about typical customer results with reliable evidence.
- They may no longer manipulate user reviews or misrepresent endorsements.
- Clear disclosures of refund and cancellation policies must be provided before consumers are billed, and companies must honor those refunds and cancellations promptly.
- Informed consent must be obtained before charging consumers’ accounts.
The NextMed case underscores several key consumer protection principles in the digital age. First, low advertised prices can be deceiving and that consumers should always check what’s actually included before signing up. Also, reviews matter — but not all of them are real. Look for verified purchaser badges or independent review sites. Finally, consumers should understand membership terms before agreeing to ongoing billing — including any minimum commitments or early termination penalties.
This enforcement action also reflects broader regulatory concern about the telehealth and online pharmacy landscape. With health-related services increasingly delivered remotely, consumers are vulnerable to misleading ads and hidden fees — especially when high-demand drugs are involved. By stepping in, the FTC is sending a clear message: healthcare convenience doesn’t trump truthful advertising and transparent pricing.
Read more about the FTC’s recent action and proposed settlement order here.