Hello, Welcome to Just Answer and thanks for your question. It actually may be Morgellon's syndrome which is also known as delusional parasitosis. No drug causes it. It is a psychiatric disorder - a psychosis. As you know visual, auditory, and sensual hallucinations are part of many mental conditions. Certainly bipolar disorder that is untreated as well as drug abuse can be contributive agents but many people have it who have no other diagnosed mental illness and do not take any drugs, legal or illegal.
It is heartbreaking to watch someone you care about go through this, but there is really not much a bystander can do. So long as a person has not been put under guardianship they are presumed to be able to make decisions for themselves, so they cannot be forced to seek medical help.