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Stem cell clinics likely to flourish despite judge’s rebuke

When the Food and Drug Administration won a landmark lawsuit this week against a stem cell company, health officials hailed it as a turning point in the government’s struggle to regulate a booming industry selling unproven treatments to desperate patients.

But the reaction of the company — Florida-based U.S. Stem Cell — and the industry’s ability to adapt to changing rules suggest the judge’s order may have less impact than many regulators and consumer advocates had hoped.

Initially, the company said it would follow a federal judge’s ruling and stop selling the fat-based procedure. But it quickly followed up with a clarification: It would continue offering stem cell treatments, but instead of fat, rely on patients’ bone marrow and other tissues to harvest the cells it claims can cure conditions as varied as spinal cord injuries and erectile dysfunction.

“It’s a bit like playing whack-a-mole,” said Peter Marks, FDA’s top official for biologic products.

Speaking at a conference last month, Marks described the frustration of trying to regulate a rapidly expanding — and morphing — industry. “There’s nothing more we would like to do than take more enforcement action,” he said. “But it’s a slow and deliberate process.”

The clinics claim their treatments help people with ailments ranging from multiple sclerosis to joint pain. But many scientists liken the procedures to modern snake oil and accuse the purveyors of preying on the hopes of seriously ill patients. Some treatments have resulted in grotesque injuries, including at least four women who were blinded after U.S. Stem Cell-related clinics injected its product into their eyes.

For years, U.S. Stem Cell openly defied federal officials to sell its unapproved procedure, which used patients’ belly fat to harvest the material for the injections used in stem cell treatments.

The company’s leaders derided a warning letter from the Food and Drug Administration as “blatantly false,” called new FDA regulations “a power grab” and bitterly foughtgovernment attorneys in federal court.

As companies in the industry have faced increased regulation and public scrutiny especially in the past year, many have responded with changes to their marketing language and, in some cases, their treatment protocols.

Some have stripped all mention of “stem cells” from their websites and advertising, offering the same treatments under names like “cellular therapy” and “allografts.”

In the months leading up to the ruling by Judge Ursula Ungaro of the Southern District of Florida, U.S. Stem Cell was already diversifying its treatments. In a December news release, the company said it was providing several new therapies — many of which have not been proved in clinical trials — such as “IV nutritionals, infrared therapy, electromagnetic pulsed wave therapy, ozone therapy, diet and nutritional counseling and other services designed to promote regeneration and natural healing.”

“Because we know cutting-edge therapies can take time to be fully understood and endorsed, it is important for us to maintain a portfolio of proven products and services each patient can choose from based on his or her own needs,” chief executive Mike Tomas said in the news release. “It’s good business and it’s good medicine.”

New rules in recent years and the FDA’s recent lawsuit against U.S. Stem Cell have focused on stem cell treatments derived from patients’ fat. As a result, many companies started offering similar treatments derived instead from blood, bone marrow and birth-related tissues, such as amniotic fluid and umbilical cord blood.

“After years of largely ignoring the issue, the FDA is finally making more of an effort, but it’s not as if this marketplace is melting away,” said Leigh Turner, a bioethicist at the University of Minnesota.

Because no one had documented exactly how many stem cell clinics existed, Turner — working with collaborators — began tracking them in a database several years ago. In 2009, there appeared to be only two in the United States; by 2017, there were at least 700. Turner believes there are currently more than 1,000.

Turner compared the for-profit stem cell industry to a balloon. As the FDA and consumer advocates squeeze one end, other parts of the enterprise expand. “For every one that’s disappeared, we’re finding seven more that are popping up.”

One tactic adopted by some clinics who have faced FDA scrutiny is to move part of their operations overseas. After FDA issued warnings to Celltex Therapeutics in Texas, for example, the company shipped part of its operations to Mexico and continued treating patients by sending them there.

Another company Liveyon — whose stem cell product made from umbilical cord blood was tied to life-threatening bacterial infections in at least 15 patients — recently opened a clinic in Cancun, Mexico. Company officials said patients with spinal cord injuries and Parkinson’s disease, along with children with autism, have been injected at the Cancun clinic.

The FDA’s lawsuit against U.S. Stem Cell is one of just a handful of stem cell clinics that it has sued because such battles require huge resources. The judge’s ruling — after almost a year of extensive motions, reports and court filings — affirmed FDA’s authority to regulate the industry and deem such treatments illegal.

“It’s an important victory because it essentially agreed that FDA has authority over these procedures, and it bodes well for FDA’s chances in other lawsuits,” said Patricia Zettler, a former FDA lawyer and health regulation expert.

But the ruling applies only to U.S. Stem Cell, Zettler said, meaning the FDA would have to sue each of the hundreds of other clinics across the country to obtain similar legal orders to stop their procedures.

Meanwhile, the government is pushing forward in a second federal court lawsuit against another stem cell business in California. That lawsuit has the potential to halt the fat-based stem cell treatment in multiple clinics because the government filed it against a company called Cell Surgical Network, which serves as an umbrella for dozens of affiliated clinics around the country.

“The logic under which FDA is asserting authority is similar,” said Zettler. “And the fact that one judge was persuaded by the government’s arguments is a good sign. The other court isn’t bound by it, but it can be persuasive to the judge’s thinking.”

Speaking at a biotechnology conference this week shortly after the judge’s ruling, acting FDA commissioner Norman “Ned” Sharpless acknowledged the difficulties of regulating the stem cell industry

“This is a watershed moment if it holds up,” Sharpless said, according to a Bloomberg report. But, he added, “we are at Mile One of what we think will be a marathon fight.”

Laurie McGinley contributed to this report.

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