Outcome, a promising health advertising startup, allegedly misled advertisers with manipulated information, according to a report from The Wall Street Journal.

The company, which places video screens in doctor's offices and charges pharmaceutical companies to run ads on them, appears to have charged some companies for ads on more screens that it had installed. Additionally, Outcome employees gave clients inflated data that showed how well the ads performed, made documents that verified certain ads were shown in specific offices, and manipulated analyses that measured the effectiveness of the ads, according to internal documents and former employees who spoke with the Journal.  

The altered reports increased business for Outcome, sources said. The Chicago-based company, which has ranked on the Inc. 5000 list for the last three years, told Inc. it saw $129.1 million in revenue in 2016. Some of its clients include major drugs firms like Bristol-Myers Squibb and Novo Nordisk.

In response to the Journal report, a spokesperson for Outcome told Inc. in an email on Thursday that the incidents reported by the Journal occurred between 2014 and 2016. He added that the company "strongly denies having a practice of misreporting campaign information to customers."

Top executives didn't have any involvement in the alleged misleading of advertising, the Journal found, but a lawyer for Outcome told the Journal three employees were put on paid leave while concerns about conduct were reviewed. 

To ensure its clients' success, Outcome said it retained the management consulting firm McKinsey to recommend improvements, adopted campaign audit standards to verify contract delivery, and increase transparency through enhanced platform-level reporting. What's more, the company says clients are able to access BPA Worldwide, an independent media auditor, to verify their campaign results.

Outcome was created by Rishi Shah and Shradha Agarwal in 2006. It reported a $5.5 billion valuation in May and has received around $500 million from investors like Goldman Sachs and Alphabet.

Published on: Oct 13, 2017