Ruling against Florida stem cell company could have implications for Coeur d’Alene center

A federal judge ruled in favor of the Food and Drug Administration on Monday in a lawsuit against a Florida-based stem cell company whose treatments have blinded at least four patients.

Judge Ursula Ungaro agreed the FDA has the authority to regulate a procedure that has become widespread in the burgeoning industry – using patients’ fat to create a stem cell treatment.

The judge said in her judgment that the FDA is entitled to an injunction ordering U.S. Stem Cell to halt the procedure.

The judgment represents a major victory for the government, which has increasingly tried to constrain the industry even as it has rapidly expanded in recent years.

Scientists, medical associations and health officials have criticized stem cell clinics for selling treatments unproven by science and unapproved by the government for a wide spectrum of unrelated ailments, such as Parkinson’s disease, multiple sclerosis, joint pain and erectile dysfunction.

Dr. Charles Murry, who chairs the Institute for Stem Cell and Regenerative Medicine at the University of Washington, said these types of procedures have no basis in actual science.

“Anybody who asks you to pay for stem cell therapy right now is a charlatan,” Murry said. “If they are asking you for money and it’s not for a bone-marrow transplant, it’s a con. It’s that simple.”

Paul Knoepfler, a stem cell biologist at the University of California at Davis, said this ruling gives the FDA the power to define a stem cell product as a drug product.

“There are potentially hundreds of clinics using the same model and this ruling basically says the FDA can – assuming this is not overturned on appeal – say you are using an unapproved drug and that’s a big deal,” Knoepfler said.

That could have implications for other stem cell centers and their treatments, like the $5,000 treatment for neuropathy at Stem Cell Centers of Idaho, which The Spokesman-Review investigated in April.

Mike Watts, a Spokane resident, received treatment at the Coeur d’Alene center for neuropathy, a condition that caused nerve damage and numbness through his left foot.

“They said, ‘That’s an easy cure. We do neuropathy all the time,’ ” Watts said. “They didn’t tell me that the $5,000 injection wasn’t going to do any good. Now I’m stuck with that debt and didn’t get nothing out of it.”

In 2015 and 2016, at least four patients were blinded after U.S. Stem Cell and clinics associated with the Florida company injected stem cells into their eyes. After those cases became public, the company stopped injecting patients’ eyes, but continued using its procedure for other conditions.

The FDA’s slow initial response to patient injuries permitted U.S. Stem Cell to continue operating for four years after those first reports of blindness. Although the company stopped injecting its fat-derived treatments into eyes after the patients sued, it continues to sell the therapy to people with spinal injuries, Parkinson’s disease, multiple sclerosis and other serious chronic conditions.

Last spring, just three weeks after the government filed suit, an additional patient had a catastrophic reaction after visiting a South Miami clinic affiliated with U.S. Stem Cell. A 59-year-old woman felt faint and started vomiting two hours after receiving injections for arthritis pain.

Her case was described in an “adverse event” report filed with the FDA and obtained by the Washington Post through the Freedom of Information Act.

In her judgment Monday, the federal judge said that unless an injunction is issued ordering the company to stop, “there is a reasonable likelihood that Defendants will continue to violate” regulations by continuing the unapproved treatments.

With $6.7 million in revenue last year, U.S. Stem Cell operates three clinics and has trained doctors at 150 others, making it one of the most influential stem cell companies in the nation. Over the past year, it has hired a top law firm to defend against the lawsuit, and cultivated formidable allies with close ties to President Trump, including GOP operative Roger Stone and Newsmax chief executive Christopher Ruddy.

In the lawsuit, the government accused the company of “openly violating the law and endangering patients by manufacturing an unapproved, experimental drug.” Responding in court, the company called the FDA’s new rules “a power grab” and argued its treatment is a medical procedure that can’t be regulated as a drug.

Judge Ungaro noted in her summary judgment Monday that the clinic makes “numerous claims” about the benefits provided by treatment derived from fat cells for an array of illnesses, including Parkinson’s disease, lung disease and diabetes. And she added that the clinic has boasted its therapy is superior to conventional medicine in treating these serious diseases.

The ruling does not automatically prevent other companies from offering the same treatment, noted Sam Halabi, a law professor at the University of Missouri. “But it sends a very strong signal to the market and other judges will look at this decision quite seriously and use it as a crucial roadmap for similar lawsuits that appear before them.”

The FDA said it was reviewing the opinion and declined further comment.

Leigh Turner, a bioethicist at the University of Minnesota and a longtime critic of the stem cell clinics, welcomed the decision but questioned whether it would prompt other companies to get out of the business. “Are some of them just going to say there are so many businesses out there that the FDA won’t knock on our door so we will just keep going?” he said.

Turner believes that some clinics will “play the odds” and continue performing the fat-based procedures while others may simply shift into other questionable types of stem cell treatment not addressed in the ruling – such as birth-related stem cell products. “I don’t expect to see the disappearance of the direct-to-consumer industry,” he said. “These businesses are too dug in and there’s too much money to be made.”

Former FDA Commissioner Scott Gottlieb called the decision a “pivotal ruling” indicating that the FDA “is on strong footing” in challenging the practices of the clinics offering unapproved stem-cell therapies. “This was a must-win case for the FDA,” he said. “It’s highly significant in that it establishes the agency’s ability to regulate in this space and it paves the way for the agency to bring more enforcement actions,” he said.

Gottlieb, who stepped up FDA action against the clinics offering unproven treatments, said the decision sends a strong message to the industry and will bolster agency efforts to take immediate action “against firms putting patients at immediate risk.”