Another stem cell lawsuit: Stemedica sued by board member over alleged mishandling of funds

Stem cell clinic biotech Stemedica has just been sued by one of its own board members based on allegations related to money the company raised, according to CourtHouseNews. The actual suit, filed by an investment company Tiara Holdings and board member Anthony Marlon, can be read here.

CourtHouseNews writes:

“Tiara Holdings II LLC sued Stemedica Cell Technologies Inc. and its top three officers on April 6 in Clark County Court. The officers are CEO and Chairman of the Board Roger Howe, Vice Chairman and CEO Maynard Howe and President and Chief Medical Officer Nikolai Yankovich.”…Dr. Anthony M. Marlon, a medical doctor and businessman, holds 430,000 shares of Stemedica through Tiara Holdings, where he is a member. He also is a member of the board of Stemedica, he says in the complaint.”

stemedica

Note that “Yankovich” seems to be a typo as the Stemedica leader in question is Nikolai Tankovich.

The allegations in the suit are summarized by CourtHouseNews this way:

“Stemedica’s founders have operated a nearly 10-year investment scheme, wherein they have raised over $110 million dollars from various individual investors for the purported purpose of funding and establishing a stem cell company,” Tiara says in the lawsuit.

Tiara claims the Howes and Tankovich “have used these investor funds, in whole or in part, to benefit themselves and their associates through excessive compensation and lavish personal expenses and related party transactions.”

“Stemedica’s founds have concealed and perpetuated this fraud through purported operating subsidiaries, which permitted them to divert millions to benefit them without raising questions or concerns from Stemedica’s investors and shareholders,” Tiara says.”

and

“It also seeks damages and punitive damages for fraud, breach of fiduciary duty, unjust enrichment and bad faith.”

Maynard Howe reportedly told CourtHouseNews that the allegations are false.

Dr. Anthony M. Marlon Stemedica

The Stemedica website still lists Dr. Marlon as a board member (see screenshot above).

Stemedica has seen some other past controversy as in part noted in the new suit related to a KPBS investigation of the San Diego company and ties reported in that piece to the stem cell transplants received by patient Jim Gass, who later developed a spinal tumor. The origin of Gass’s tumor remains unknown to my knowledge and may have had nothing to do with Stemedica’s cells, but the stem cell community would benefit from more clarity on that situation. Stemedica also garnered major media attention further back for its role in a non-FDA-approved stroke treatment received outside the U.S. by hockey legend Gordie Howe (no relation to the company’s Howe brothers).

Another San Diego stem cell businesses, Stemgenex, is also the subject of a lawsuit, in its case related to allegations of improper marketing claims. Additional recent stem cell clinic-related lawsuits have been filed, settled, or remain active as I discuss here and here.

Big HT to Alexey Bersenev.

Gordie Howe family reportedly invested in stem cell business they touted for treating their father

Gordie HoweIt has been one of the most hyped stem cell stories in history.

Hockey legend Gordie Howe had a devastating stroke last fall and supposedly a stem cell treatment in Mexico from for-profit stem cell businesses, Stemedica and Novastem, caused a remarkable recovery in Howe.

What really happened?

Today a new article on a fresh investigation into this story sheds some important additional light on it including the bombshell that Howe’s family has invested in Stemedica.

For background, the Howe treatment was given via stem cell company Stemedica and its partner in Mexico, Novastem. Reportedly, Anesthesiologist Cesar Amescua did the actual stem cell transplant into Howe.

Back immediately after the treatment in Mexico, Howe’s family raved about it. The effects were described by them and others as miraculous.

Sports commentator Keith Olbermann went ‘weak in the knees’ at how amazing it all seemed in a gushing interview with Stemedica leader, Maynard Howe (no relation to Gordie) on the air.

I was happy to see Gordie doing well, but skeptical for a variety of reasons that stem cells were the reason. If anything, David Gorski was even more skeptical.

Why?

First, the timing of the recovery seemed way too fast for a stem cell treatment. Howe reportedly had gotten better almost immediately after getting the cells, which would normally be expected to take quite some time to work — days or weeks instead of a few hours.

In addition, Howe’s recovery could have been a result of any number of things including simply placebo effect or a natural recovery from the stroke. Many were claiming out right that the stem cells worked magic.Duncan Stewart

Further, Howe received the treatment for free, while it would normally cost $30,000, and the Howe family was not shy about telling the world how great it all seemed to be and how wonderful Stemedica was. It’s understandable I suppose that they were enthusiastic about a company that they believed had helped their dad.

Stemedica and Novastem received the equivalent of an all out PR blitz in the media. Additional business seemed to head their way.

CTV News/W5 has now investigated and reported on what they found both on TV and online.

I encourage you to watch the videos as they are very striking.

Dr. Duncan Stewart, the scientific director of regenerative medicine at the Ottawa Hospital Research Institute and a stem cell researcher (pictured above from video screenshot), agreed to visit Stemedica and Novastem as part of the CTV investigation. By way of disclosure, I was separately invited to visit as well, but declined because I felt concerned about how this story had unfolded.

Stewart viewed the situation as a good news/bad news kind of thing as described on the Ottawa Hospital website:

“The good news is that the stem cells that Mr. Howe received were produced in a facility in the U.S. that complies with appropriate regulations, so we know that these were high-quality stem cells,” said Dr. Stewart. “I was also encouraged to see that the licensing agreement between the stem cell production facility in the U.S. and the clinic in Mexico requires that the stem cells be administered through clinical trials.”

“The bad news is that the clinic in Mexico is not in a position to perform clinical trials that meet Canadian and U.S. regulatory standards,” added Dr. Stewart. “This means that it is not clear whether meaningful results will be collected and whether patient safety will be adequately protected. It is also important to remember that this is not a research facility – it is a for-profit business.”

Howe’s recovery itself seems indisputable and is great news, but what caused it?

Nobody can be sure.

Dr. Steven Cramer, a neurologist at University of California Irvine, examined Howe and suggested possible non-stem cell treatment-related reasons as to why Howe might have bounced back:

“Cramer says physical and occupational therapy could have played a role or there may have been a spontaneous improvement, which happens sometimes during the first three to six months. But Gordie’s recovery may be due to the so-called “piss-and-vinegar gene” — a fighting spirit or drive that Gordie has in abundance, Cramer said.”

Another notable thing mentioned in the coverage of this investigation was this shocker:

“Following Gordie’s amazing recovery they have invested in Stemedica, and Murray Howe is hoping to begin studies of stem-cell treatment for brain injuries at his hospital in Ohio.”

Gordie’s children have invested in Stemedica?  This investment is also mentioned in the CTV online piece, but only near the end and without any details.

This purported investment, if confirmed, means that Gordie Howe’s family have a vested interest in the success of the company that treated their father. This connection raises some serious concerns.

See here for Leigh Turner’s insightful perspective on the Howe family investment in Stemedica including five key questions that he believes the family should address:
  • Who in the Howe family invested in Stemedica?
  • What is the size of this investment?
  • Where was this investment first discussed?
  • When did members of the Howe family make this investment?
  • Why did they decide to invest in Stemedica, why have reporters not described their investment until this weekend, and have any Howe family members done media interviews without first disclosing this investment?
In the end we may never know the answers to these questions or the reason that Gordie bounced back so well, but this story illustrates the complexity of the stem cell for-profit clinic world and the difficulty in separating fact from speculation or promotion.

Olbermann Puff Interview on Stemedica & Gordie Howe

The stem cell company Stemedica has made a name for itself in the media lately through hockey legend Gordie Howe, who received a non-FDA approved stem cell “treatment” in Mexico via Stemedica and its partner, Novastem.

Howe, known as Mr. Hockey, had several strokes in late 2014 and his health was declining. Stemedica and Novastem gave Howe a free stem cell therapy. According to his family, Howe got a lot better.

I’m glad he’s feeling better.

What I’m less sure of is whether the stem cells or something else such as rehydration or simply some degree of natural recovery from the stroke helped Howe.

Science-based medicine examined this case in two pieces that I recommend (here and here).

Stemedica OlbermannA new  interview on this case–image above and video below–by Keith Olbermann in which he talked to Stemedica CEO Maynard Howe (no relation to Gordie Howe) sure seems like a big PR win for the company.

If you watch it, it basically feels like an ad for Stemedica.

I am a big fan of Olbermann, but he dropped the ball (err, puck) on this one.

I have no issue with Gordie Howe and I wish him the best. What makes me concerned is that this kind of interview is almost certain to drive many regular folks to get potentially risky, unproven stem cell “treatments”.

I asked internationally respected, translational stem cell scientist Jeanne Loring for her opinions on this Olbermann TV interview and here’s what she had to say:

“Since Stemedica is known to sue people who criticize them (I hope they don’t sue me for saying that), I will be very careful about how I present the facts.  There are two things that worry me.  First, the Stemedica representative did not say that in addition to the mesenchymal stem cells they used for treating Gordie Howe, they also used cells from aborted fetuses, which is one of the reasons that the treatment was done in Mexico. I would expect that to raise some ethical concerns.
The second is that there will soon be solid evidence about whether or not mesenchymal stem cells reduce the severity of stoke.  A company called Athersys is currently finishing a Phase 2 trial that has been specifically designed to determine whether mesenchymal stem cells have any effect on stroke  https://www.clinicaltrials.gov/ct2/show/NCT01436487?term=athersys&rank=2.
Stemedica’s trial in the US is essentially a repeat of what Athersys has already done- show safety  https://www.clinicaltrials.gov/ct2/show/NCT01297413?term=stemedica&rank=1.  This is a “safe” choice for a safety trial, since it’s already been done.
There is a third issue that I want people to understand, and this is personal.  If you’ve ever had a family member have a stroke, you know that there are often periods of great improvement in the months following the stroke.  It’s not a miracle. The recovery depends on the severity and the location of the stroke in the brain  I know that it is very traumatic for a family member to deal with stroke, and I think that it would be unfortunate if anyone would exploit that traumatic situation to sell a product.”

The bottom line is that the way it stands now the Olbermann interview has not helped provide clarity on this complicated issue, so a follow up piece from Olbermann with some depth and varying opinions is much needed for balance.Olbermann Knoepfler Twitter

I engaged Olbermann on Twitter on this. Perhaps he might do a broader, probing look at stem cells in pro sports? Let’s see. I suggested it.

Checking That Supposed Stem Cell Miracle for Hockey Legend Gordie Howe

Gordie HoweOne of the bigger stem cell stories in the past week was that hockey legend Gordie Howe had received a stem cell ‘treatment” that had “miraculous” positive effects after having a few strokes over the last couple months.

I am highly skeptical of this holiday miracle stem cell story and very disappointed in the media for essentially swallowing the PR (most often verbatim) without giving it more thought. How about doing investigative reporting or asking good, probing questions?

I like hockey. I went to many games when I used to live in Seattle as a fan of the Seattle Breakers. I have great respect for Mr. Howe, I’m glad he’s feeling better, and wish him the best. I have a bad feeling about this stem cell miracle story though.

So what’s the scoop here?

Howe received stem cells via a company called Stemedica along with a Mexican firm called Novastem. Let’s take a close look at the statement reportedly released by the Howe family about this stem cell intervention to identify some very puzzling and concerning elements that are red flags (emphasis mine):

“Following the press coverage of our father’s deteriorating medical condition, the Howe Family was contacted in late November by Dr. Maynard Howe (CEO) and Dave McGuigan (VP) of Stemedica Cell Technologies. McGuigan knew our family as a result of his previous employment with the Detroit Red Wings. Stemedica is a biotechnology company that manufactures allogeneic adult stem cells in its U.S. government licensed, cGMP facility in San Diego, California. Although no relation, Dr. Howe and his brothers Drs. David and Roger are hockey players and big Gordie Howe fans, having grown up in Minnesota. They wished to help our father by generously facilitating Dad’s participation in a stem cell clinical trial at Novastem, a licensed distributor of Stemedica’s products in Mexico.

Novastem (www.novastem.mx) is currently conducting federally licensed and Institutional Review Board approved clinical trials for several medical conditions, including stroke, using Stemedica’s stem cell products. At the time we were contacted, Mr. Hockey had been rapidly declining and was essentially bedridden with little ability to communicate or to eat on his own.

After reviewing the information on Stemedica and Novastem, our family decided to give our father this opportunity. On December 8, Mr. Hockey underwent a two-day, non-surgical treatment at Novastem’s medical facility. The treatment included neural stem cells injected into the spinal canal on Day 1 and mesenchymal stem cells by intravenous infusion on Day 2. His response was truly miraculous. At the end of Day 1 he was walking with minimal effort for the first time since his stroke. By Day 2 he was conversing comfortably with family and staff at the clinic.

On the third day, he walked to his seat on the plane under his own power. By Day 5 he was walking unaided and taking part in helping out with daily household chores. When tested, his ability to name items has gone from less than 25 percent before the procedure to 85 percent today. His physical therapists have been astonished. Although his short-term memory, strength, endurance and coordination have plenty of room for improvement, we are hopeful that he will continue to improve in the months to come.

As a family, we are thrilled that Dad’s quality of life has greatly improved, and his progress has exceeded our greatest expectations. Once again, we cannot emphasize how much you have fueled Mr. Hockey’s recovery and we thank everyone for their continued prayers and support.”

Let’s walk briefly through the highlighted parts one-by-one and think about the questions that they raise. Note that I’ve contacted Stemedica with some of these questions and have posted their replies here.

1. The Howe family was contacted by Stemedica. Did Stemedica reach out as a public relations effort?

2. The statement describing Stemedica is a red flag for a number of reasons. It includes very technical terminology not widely understood outside the stem cell biotech and regulatory field. Was it written by Stemedica or Novastem or others linked to these stem cell for-profits? Stemedica now says they did not write it.

3. Stemedica generously facilitated Howe’s clinical trial participation. This also is concerning. Did Stemedica and Novastem provide free ‘treatment’ to Mr. Howe, hoping for some positive, essentially free publicity?

4. The weblink to Novastem. Why would a statement by Howe’s family include a weblink to Novastem? Did the company ask the Howe family to do that in their statement as a way to get more customers?

5. Federally licensed clinical trials? This vague statement could be misinterpreted to mean that the trials are licensed by the FDA here in the US. Again, to my knowledge, this is not the case. Are they perhaps referring to licensed by the Mexican government?

6.Truly miraculous” response. We’ve learned in the stem cell field to view statements about “miracles” related to stem cell “treatments” to be big red flags. As much as we might wish for miracles, there are few real medical miracles.

7. Tested improvement. Who tested Mr. Howe’s function? Family? Physicians? How was it measured objectively?

Sadly, this “family” statement has a feeling potentially of being like an ad for Stemedica and Novastem.

The bottom line is that I view this story of the stem cell ‘miracle’ for Mr. Howe as a troubling, complicated tale. It’s frustrating that the media did not do a better job of investigating it rather than just parroting what they were told. Again, I wish Mr. Howe and his family all the best, but it’s a reasonable question to ask if they’ve been used for publicity here. The end result of this kind of situation can be more patients getting unproven, potentially risky stem cell “treatments”.