State Attorneys General have recently filed actions against stem cell clinics whose outsized claims for their treatments far outstripped the evidence. Today we’ll look at several of these cases and see how the states are helping fill the gap caused by the lack of effective regulation for these relatively new therapies.
Stem cell clinics are ubiquitous in the U.S. and, unfortunately, too many make claims of effectiveness that are not backed by sufficient evidence for any number of conditions, including Parkinson’s disease, ALS, stroke, traumatic brain injury, and spinal cord injuries. In addition to overstating the success of their treatments, some clinics enroll patients in what are essentially fake clinical trials, charging thousands of dollars to participate. Both financial and physical harms (for example, blindness) from worthless stem cell treatments have resulted.
Because stem cell therapies are relatively new, regulation is playing catch up. Some therapies are considered drugs or biological products by the FDA and are therefore regulated as such. Others are not. Where to draw the line between the two is a point of contention between stem cell clinics and the FDA.
The Federal Trade Commission (FTC), with its jurisdiction over “unfair or deceptive acts or practices in or affecting commerce”, including advertising claims, can also serve as a means of regulating stem cell clinics, although unfortunately after-the-fact. Rather than haggling over whether or not a therapy is subject to FDA regulation, the FTC asks, more simply: “Are your claims backed by competent and reliable scientific evidence?” Because evidence of effectiveness is limited, or nonexistent, for the vast majority of conditions, this may prove a more efficient route to shutting down dubious clinics, or at least hitting them with big financial penalties.
States, too, have their own consumer protection laws, typically enforced by the states’ Attorneys General (AGs). Under these laws, as well as specific false advertising statutes, state AGs are permitted to initiate and conduct investigations and bring lawsuits on behalf of the states’ citizens. Once a lawsuit is initiated, liability for consumer protection act-based claims for false advertising can be found without a showing that anyone was actually harmed or defrauded by the false advertising — the law merely requires that deception was likely. Such a low threshold makes these state laws particularly potent tools for state AGs seeking to hold companies liable for false or deceptive advertisements.
States sanction stem cell scams
Last November, New York Attorney General Letitia James announced a $5.1 million judgment against a New York City stem cell clinic (now defunct) and its managing physician, Joel B. Singer, MD, for fraudulently advertising their stem cell therapies, settling a 2019 lawsuit brought for scamming patients out of thousands of dollars each for unproven and potentially harmful treatments. The defendants were also enjoined from fraudulent and deceptive marketing of their stem cell treatments.
The clinic advertised widely that it could treat a variety of serious medical conditions using patients’ own stem cells, including erectile dysfunction, cardiac/pulmonary disease, neurological diseases (such as Parkinson’s disease), autoimmune diseases (like lupus), and orthopedic conditions.
The clinic falsely claimed in advertising that stem cells “represent a medical breakthrough in the treatment of many chronic medical conditions”, that there was a “great deal of excitement” about using stem cells to “treat currently incurable diseases”, and that their stem cell treatments could “treat the entire body not just the injured part”. The defendants represented stem cells as “magical” or “miraculous” cells that could help diabetes patients avoid amputation and even help people suffering from rheumatoid arthritis to “throw away crutches and get younger”. Of course, as the AG noted, there is currently no adequate scientific substantiation that stem cells can effectively treat any of these conditions.
Treatments were promoted using testimonials from well-known individuals like Guardian Angels founder Curtis Sliwa and NFL player Darrel Reid without disclosing that they did not pay for these treatments, in effect compensating them for their endorsements without letting the public know. The defendants also falsely claimed that their procedures were FDA-approved and had been endorsed by several scientific and medical organizations and that patients were participating in an established research study.
The defendants charged consumers nearly $4,000 per procedure, with several consumers paying over $20,000 for multiple procedures. Most of the procedures involved adipose stem cells, derived from a patient’s own fat tissues.
Earlier last year, in August, the Georgia Attorney General joined the FTC in filing an enforcement action in federal district court against Regenerative Medicine Institute of America, doing business as Stem Cell Institute of America, and several other corporate and individual defendants, for violations of the Georgia Fair Business Practices Act and the FTC Act.
The complaint alleges that the defendants made false and misleading claims about stem cell therapies offered to consumers in Georgia, aggressively marketing and selling these therapies, mostly to older adults. They allegedly advertised to the public and to healthcare practitioners that their therapies cure, treat, or mitigate a variety of orthopedic diseases and health conditions, and that they are comparable or superior to conventional treatments for these conditions. According to the complaint, these claims are not backed by competent and reliable scientific evidence.
Two of the defendants, Physician Business Solutions and Stem Cell Institute of America, according to the complaint, generated millions of dollars in revenue by training and advising chiropractors and other health care practitioners on how to add stem cell therapy to their practices. Another defendant, Superior Healthcare, allegedly generated revenues by selling these products directly to consumers and by contracting with clinics throughout the state to administer injections in exchange for a fee. These therapies cost approximately $5,000 per joint injection, with patients often receiving more than one injection.
The complaint reveals the creative way in which chiropractic “adjustments” gibberish, unproven stem cell treatments, and anti-“allopathic” medicine propaganda were rolled into one convenient package for chiropractors looking to earn an extra buck. From promotional material used in luring chiropractors to join the scheme, quoted in the complaint:
Stem cells help to rejuvenate the joints, allowing your adjustments to really take hold and the alignment process to occur. . .
Stem cell and regenerative therapies have recently shown incredible results with conditions that, up until now, were only treated with dangerous, unreliable surgeries or masked with pain drugs. But with these therapies, patients are experiencing seemingly miraculous outcomes. Chiropractors can be integrated with a [sic] MD or DO to offer these protocols in merely 60 days. Yet these therapies keep with the spirit of the chiropractic soul, i.e., avoiding allopathic health care, major surgery or pain drugs.
So, in sum, the way to help patients avoid allopathic health care and its attendant dangers is to team up with an allopathic practitioner to administer unproven, risky therapies.
The lawsuit, which is still pending, seeks injunctive relief, consumer restitution, disgorgement of ill-gotten gains, and civil penalties which, under Georgia law, are doubled for violations committed against elderly or disabled persons.
A similar suit was filed in 2020 by the Georgia AG against Elite Integrated Medical and other corporate and individual defendants seeking injunctive relief, consumer restitution, and civil penalties. According to that complaint, Elite made over $6.4 million by using aggressive marketing techniques and high-pressure sales tactics to convince consumers, most of whom were elderly and/or disabled, to purchase expensive, unproven stem cell treatments that are not covered by Medicare or health insurance. The AG alleges that
Elite represents that it has a staff of medical doctors who provide its products to patients, when in fact, medical doctors administer a very limited number of product injections. The vast majority of patients interact only with chiropractors and nurse practitioners, and most of the injections are administered by nurse practitioners.
As best I can tell, the suit is still pending in a Georgia state court.
Finally, last week the Washington State Attorney General filed a civil action in state court against Seattle-based US Stemology and its owner, Tami Meraglia, MD, for deceptively marketing stem cell therapies for COVID-19 and dozens of other serious medical conditions, including asthma, lupus, Parkinson’s disease, congestive heart failure, and MS, in violation of the state’s Consumer Protection Act. The complaint alleges that there is no reliable clinical evidence that stem cell therapies can effectively treat these conditions. Dr. Meraglia began the stem cell clinic out of the basement of her “medispa”, which mostly performed aesthetic and cosmetic treatments.
According to the complaint, the defendants charged patients as much as $10,000 to participate in the clinic’s purported “patient funded research” and claimed they were treating patients as part of clinical trials. These “clinical trials” were under the supervision of an Institutional Review Board (IRB) operated by a company called the International Cell Surgical Society. Two of the primary “researchers” listed on US Stemology’s trials were also principal officers of the company operating the IRB when it approved the trials, an obvious conflict of interest.
Per the AG’s press release,
the trials themselves did not follow accepted standards of research. For example, the trials did not use a control group or a standard course of treatment for each patient, and relied solely on patient surveys to assess results. Typically, legitimate clinical trials pay patients — not charge them thousands of dollars — for agreeing to undergo experimental treatments.
In what should be an inspiration to us all to report such nefarious activity, the AG’s office was first alerted to the clinic’s false claims that it could prevent and treat COVID-19 by a concerned citizen. When investigators looked into the complaint, they found claims that the clinic’s stem cell therapies could treat dozens of other conditions, claims for which no reliable scientific evidence existed.
The lawsuit seeks injunctive relief preventing the clinic from making the allegedly false and deceptive claims, restitution for patients, and civil penalties which could, according to the AG, total in the millions of dollars.
Conclusion: A good start for individual states
Until there is a comprehensive regulatory scheme in place, unscrupulous practitioners and their associates will continue to abuse patients for profit with unproven stem cell therapies and bogus clinical trials. In the meantime, the states can help deter these greedy charlatans by vigorously pursuing stem cell scofflaws in court using state consumer protection and false advertising laws.