Goldwater Institute weighs in against FDA on Cell Surgical Network lawsuit appeal

An important appeals case is pending not just for the defendants Cell Surgical Network, et al., but also for the FDA. It could impact the stem cell field very broadly too.

Cell Surgical Network lawsuit status

Hopefully, we’ll get a decision before the end of this year.

Cell Surgical Network is a large chain of unproven stem cell clinics. Drs. Elliot Lander and Mark Berman founded the network.

The clinics in the network market adipose cell preparations for a variety of medical conditions. None of these applications have FDA approval. The agency filed suit seeking an injunction with the case ending up in California federal district court. The FDA lost and now their appeal is pending at the Ninth Circuit.

What’s at the heart of the case? What’s new?

Elliot Lander, Cell Surgical Network
Dr. Elliot Lander, a founder of Cell Surgical Network. Video screenshot.

The appeal

The FDA has defined specific adipose cell preps as drugs.

One called stromal vascular fraction or SVF is the most commonly used. The FDA says SVF is a drug. In a federal court case in Florida, the FDA prevailed over a firm called US Stem Cell Clinic, which had been selling SVF infusions. The ruling stood up on appeal. US Stem is thus enjoined from selling SVF, although a new personal injury lawsuit against US Stem raises possible questions about compliance.

However, here in California, things turned out very differently in court as I noted earlier.

The FDA lost the SVF-related case against Cell Surgical Network and others including California Stem Cell Treatment Center. California federal district court Judge Bernal ruled in favor of the chain of stem cell clinics. He ruled that SVF isn’t a drug, which is going out on a limb in my view. In addition, he took the more extreme step of saying that even lab-grown fat cells are not a drug. Years ago the FDA prevailed in a case, USA vs. Regenerative Sciences Inc., indicating that amplified bone marrow cells were a drug. So Bernal went against that precedent.

I testified in the new case before Bernal and thought he seemed hostile to the FDA.

Is SVF a drug? For now, yes and no.

As things stand now, are fat cell preps a drug or not?

We’ve now been stuck in a gray area for quite some time and part of it depends on geography. In the jurisdiction of the court that ruled in favor of the FDA in the Florida case, it would seem that SVF and similar adipose stem cell preps are now drugs. Here in the jurisdiction of the California court, I guess not?

No matter where you are in the U.S. if you are a stem cell clinic it is highly risky to be selling SVF given the legal uncertainty.

Meanwhile, everyone awaits word from the Ninth Circuit.

The Goldwater Institute on Cell Surgical Network case

The importance of this current appeals case has been further highlighted by some heavy hitters filing amicus briefs one way or another. Earlier this summer, we saw ISSCR and ISCT, two of the most important cell therapy organizations, make joint statements in support of the FDA:

Now more groups have weighed in including The Goldwater Institute. Another less well-known group, called the Association of American Physicians and Surgeons, made similar arguments as Goldwater in its new amicus too. Both are opposed to FDA oversight here.

Free cell therapies from all regulation?

In their amicus brief The Goldwater Institute outlined their reasoning. Here are their three main points and my thoughts on each.

1. “For the FDA to treat biological materials and surgical procedures like drugs is a regulatory mismatch and needlessly harms patients.” The reality here is that biological materials can be drugs. This not only includes cells but also other biologics such as growth factors, antibodies, etc. The FDA has been conducting oversight of biological drugs for a very long time. Certainly stem cells and other cell products can be drugs, particularly if they are extensively different from the tissues from which they are extracted. That difference is clearly apparent in the case with SVF vs. endogenous adipose tissue. SVF does not exist in the human body. It’s a laboratory creation. Bernal got this very wrong and Goldwater has it wrong too.

2. “Allowing the FDA to regulate an individual’s own cells as a drug encroaches on patients’ medical autonomy.” This argument may be summed up as the old “our bodies, our cells” mentality. Even autologous biological products (e.g., a patient’s own cells) can become drugs and those that are drugs need oversight, such as for safety considerations. Sponsors also need rigorous evidence of efficacy. Often the FDA is best able to impartially make such determinations. Yes, patients should have autonomy in many cases, but that is not universal.

3. “Permitting the FDA to treat a surgical procedure as the manufacture of a drug intrudes upon state power to oversee the practice of medicine.” In my view, the type of procedure in question is not strictly a surgical one as it also includes a cell therapy manufacturing component. Using SVF is not equivalent to taking a blood vessel from one part of the body and using it as a graft into another part, which is a common example cited by those pushing against the FDA. The blood vessel in that procedure is the same as it was in the body originally.

Finally, I don’t see why only states should regulate this process. Do attorneys out there care to comment?

Looking ahead

As most of you know, I’m not an attorney. As a scientist, I don’t see how these three arguments hold water. However, as we saw with Judge Bernal here in California, judges can and do see things differently sometimes.

I hope the Ninth Circuit is logical, does its homework on the science, and puts patient safety and well-being first. Not all FDA oversight is bad, no matter what some folks claim.

As an update, a perfect recent example of the harm of proper oversight, which would result from what Goldwater is suggesting, is the Alvaro Skupin, et al. personal injury lawsuit case where a patient was blinded in one eye from adipose-related eye injections. A HT to an anonymous friend who pointed this out.

Any thoughts on how the appeal will go?

6 thoughts on “Goldwater Institute weighs in against FDA on Cell Surgical Network lawsuit appeal”

  1. I am tired of people having “opinions” who have no right to opinions

    Stromal vascular fraction is a drug…this is a medical fact ,,,,it is not an “opinion”….it has nothing to do with the patient’s right to their own cells….they are no longer the same damn cells when they are extracted and treated with enzymes !

    or am i missing somthing????

  2. A. Rahman Ford, J.D, Ph.D.

    I am a lawyer. Here’s my take.

    First, I commend the Goldwater Institute for advocating for reasonable federal regulation of autologous stem cell therapies. I and many others have made similar arguments. I am heartened to see that their salience and resonance are increasing.

    Second, it goes without saying that the “scientific” perspectives in the current litigation are important and necessary. However, judges also consider the political and social ramifications of their decisions, although they may not admit it. This is how law and society advance.

    Thus, issues of: (1) personal autonomy in one’s own stem cells, (2) the proper balance between state/federal jurisdiction in the practice of medicine, and (3) how unduly strict FDA autologous SCT regulations exacerbate the divide between the “health haves” and the “health have-nots” are not ancillary or subsidiary to the “science.” Rather, they must stand on equal footing.

    This broader approach to judicial decision-making is legitimate and necessary – particularly as it concerns autologous SCT such as SVF – because legal opinions aren’t just words on paper. They affect REAL people in the REAL world. Indeed, issues of fundamental fairness are inextricably woven into the tapestry of American jurisprudence.

    The Supreme Court’s decision in Brown v. Board of Education is instructive here. In that case, the Court found that separate schools for black and white children violated the 14th Amendment. It was and remains a monumental decision.

    Rather than simply rely on precedent and a rigid legal analysis, the Court in Brown considered social science data that showed the undeniably deleterious social/psychological impact that the separate, poorer schools had on black children.

    At the time, such an approach was considered controversial. However, today – almost 70 years later – we all realize how wise, humane and forward-thinking the decision was. In today’s America, racial segregation is considered abominable and anachronistic, and rightfully so.

    Now, the 9th Circuit has the opportunity to take an important step in declaring health segregation abominable and anachronistic. It can do so by ruling against the FDA and affirming Judge Bernal’s trial court decision.

    We must move forward.

    Thank you.

    1. @ A. Rahman,
      It’s good to get a variety of opinions so thanks for your comment. I don’t see the relevance of Brown v. Board of Education here though, even if I agree that was a wise decision. I don’t believe the stem cell case is about health segregation.

      Before I dive further into that perhaps you could explain why you think this case is relevant to what you call health segregation? And what do you mean by health segregation specifically as it relates to cell therapies?

      A few more points:

      Further as to the SCOTUS decision comparison, in the original ruling on the current stem cell case, I feel that Judge Bernal, while of course entirely free to ignore precedent and even science, did not really lay out some wise new framework that explained his deep reasoning or anything like that, nowhere in the same ballpark as Brown v. Board of Education.

      If memory serves, Bernal often just used the defendants’ arguments and even their exact words in his ruling. Maybe judges more generally often do this in terms of using one party’s words if they rule in their favor? Anyway, it didn’t seem like a particularly profound ruling. A lot of the science in the ruling and associated docs was also just plain wrong.

      1. “Before I dive further into that perhaps you could explain why you think this case is relevant to what you call health segregation? And what do you mean by health segregation specifically as it relates to cell therapies?”

        I may be able to answer those questions on a very personal basis. I’m 62 and fully employed. I have joint problems particularly in my knees. I was told in August of 2012 that I would likely need surgery for those knees. In October of 2014, I decided to become a patient at a “Stem Cell” Clinic. I had both knees injected with platelet rich plasma (PRP) at a cost of about $1300.00 for both knees at the same time. Today, that cost has risen to about $1200.00 per knee. Most people cannot afford that even when fully employed with “good” insurance. I’ve had to repeat these injections on occasion with boosters. To me, the health care divide or segregation in part concerns folks in my situation who have been fortunate enough to be able to afford the “stem cell” clinics and those who cannot. Even so there’s still quite a number of people who cannot so much as afford insurance. I’m lucky because of my job and financial situation to have regenerative medicine at my disposal. Most patients are not that fortunate. I would say that counts as quite a divide or segregation if you will.

  3. Oh, Admin:

    I’m not an attorney, but the issue is not whether there is a good reason for only states to regulate the process. That position is pushed by the private stem cell clinics to avoid a blanket federal prohibition. If the court leaves it up to states to decide individually, while they might be prohibited in some states, they might be allowed in others; and they would just move all of their clinics to the permissive states and still keep exploiting desperate people to make money.

    James @ Asymmetrex®

  4. Dear Admin:

    Though private company stem cell clinics have been called “unproven” stem cell clinics for many years now, I would like to encourage you and others to used a better descriptor for them going forward. “Unproven” has the implicit and pious bias that there are other stem cell clinics or treatments that are “proven.” The latter characterization is certainly open to semantic debate, and even scientific debate if criteria of absolute cause-effect confirmation are demanded. However, without doubt, those treatments with stem cells that are approved and have a record of clinical practice and continued development have undergone many validations; and in more recent times, scientific validation by clinical trials. Even when scientific validations of treatments provide evidence that they are safe and effective, they don’t “prove” treatments. They define them, based on empirical quantitative evidence, to be effective within a finite range of predictability. The private stem cell clinics of concern have not performed such validation studies, neither by scientific prospective clinical trials, nor even by retrospective observational documentation of their outcomes. They are UNVALIDATED stem cell clinics. Consider using this language to avoid the charges of subjectivity and bias that the current language “unproven” cannot defend against.

    James @ Asymmetrex®

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