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Truepill, a digital health unicorn, conducts fourth round of layoffs in 2022

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Truepill, a platform that helps other companies offer diagnostics, telehealth services and prescriptions, has conducted its fourth layoff of the year.

Sources say the layoff impacted around 65% of the existing staff across the engineering, human resources, design, IT and finance teams. The layoff comes around two months after its last round, which sources say impacted about a third of the company, or 175 people.

Update 10/06/22: After publication of this story, Truepill chief growth officer, Doreen Bortel, reached out with a series of corrections regarding the layoff figures. First, Bortel said that the fourth round of layoff impacted 20% of staff, a figure that only counts full-time, regular employees across all departments including vice presidents and above. The third round, Bortel says, impacted 8% of the then-headcount, not 33%. Neither figure includes contractors.

One employee, who spoke to TechCrunch on the condition of anonymity, said that they were told that their position was “no longer sustainable due to economic factors” on a 1:1 call with leadership. Severance was mentioned but HR has not yet reached out to the employee with further details.

“[The company said] it hoped there wasn’t going to be any layoffs after the August round,” the source said. “[Leadership said that] investors made some requests in order for the company to extend the financial runway so they made tough choices, but that we were now on good footing.”

A company-wide all hands, previously scheduled for this week, has been bumped to next week, the source added.

A troubling startup layoff trend has emerged

In April, Truepill halted prescriptions to ADHD medications because of growing concerns about digital health. The disruption in service impacted employees within Truepill’s recently acquired adult ADHD treatment company, Ahead. Reports say that Truepill was the preferred pharmacy partner of Cerebral, which is under federal investigation amid claims that employees felt pressure to prescribe drugs to customers.

In June, Sid Viswanathan confirmed that he laid off an additional 15% of staff, impacting 150 people. Viswanathan said in a letter that the company was “focused on defining a new category in healthcare and growing top-line revenue,” but what was essential is the company operates “with a new level of financial discipline and prioritization, ensuring the longevity of Truepill for both our clients and our teams.”

In August, Truepill’s entire U.K. team was laid off, as well as a meaningful portion of the virtual pharmacy platform’s product team, sources told TechCrunch. The data team was also impacted, while the diagnostics and telehealth components of the company — its core services — will be only lightly supported going forward. Truepill says these services have always been “ancillary” to the business.

Today’s layoff impacts a number of teams, including the support engineering team that was tasked in picking up the U.K. team’s work after they were let go.

Current and former Truepill employees can reach out to Natasha Mascarenhas at natasha.m@techcrunch.com, or Signal, a secure messaging app, at (925) 271 0912.

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