FTC takes on deceptive stem cell therapy claims for blindness cure and autism treatment

Hogan Lovells

On October 18, the Federal Trade Commission (FTC) announced it settled charges against California-based Regenerative Medical Group, Telehealth Medical Group, and the founder of both companies, Dr. Bryn Jarald Henderson, based on deceptive stem cell therapy claims.  In its complaint, the FTC alleged Henderson and the companies made unsupported claims, including that “amniotic stem cell therapy” can treat serious diseases, including Parkinson’s disease, autism, macular degeneration, cerebral palsy, multiple sclerosis, and heart attacks.  Henderson and the companies even claimed that the treatment could “reverse autism symptoms” and cure blindness.  The FTC asserted that the claims are not supported by scientific evidence in violation of the FTC Act, which prohibits false advertising and deceptive practices.  The settlement:

  1. Imposes a partially suspended $3.31 million judgment, which represents what patients paid for the treatments,
  2. Prohibits Henderson and the companies from making these and other health claims in the future unless the claims are true and supported by competent and reliable scientific evidence, and
  3. Requires the defendants to notify current and former patients about the settlement within 30 days.

In addition, under the terms of the proposed order, Henderson and the companies are required to submit compliance reports to the FTC of any changes in ownership interest or business activity for the next 10 years.

FTC blasts “dramatic” marketing claims

In a “Business Blog” post, the FTC describes Henderson’s marketing claims as “dramatic,” citing a promotional letter from Dr. Henderson that reads, “Lives are being saved, the blind see, the crippled walk and the patients with heart, lung, kidney and nerve diseases can alter the course of their suffering with a simple therapy [that] lasts for years and impacts their lives NOW!”  In addition, one of the company’s YouTube videos featured an 11-year-old girl with cerebral palsy who purportedly spoke “her first words” after receiving treatment from the defendants; yet, the FTC points out “there are no human clinical studies showing that amniotic stem cell therapy treats any diseases in humans and certainly not the long list of conditions the defendants claimed to cure.”

In order to avoid running afoul of health representation laws, the FTC advises clinics:

  • Don’t draft your ad copy until you have methodologically sound testing in hand that demonstrates statistically and clinically significant results: products that promise to treat or cure diseases need the support of human clinical testing.
  • Exercise caution when using in-the-headlines medical terms, such as “stem cell treatment,” which covers a broad range of therapies.

Historic first for FTC enforcement against stem cell clinics

This is the first time the FTC has cracked down on stem cell clinics, and the action against Regenerative Medical Group and Telehealth Medical Group follows a trend of regulatory actions by federal agencies, including FDA, challenging false and misleading claims related to unproven treatments for autism, arthritis, macular degeneration, and other serious conditions.

FTC’s attention to deceptive stem cell therapy claims is particularly noteworthy because, under a longstanding agreement, FTC defers to FDA for the regulation of prescription drug advertising and promotion, raising the question of how the two agencies will collaborate on human cell and tissue products in the future.  We have also been monitoring how FDA is following through on its commitment to increasing focus on oversight and enforcement in the regenerative medicine space, including injunction and seizure actions and a Warning Letter against other stem cell clinics, recently summarized here.  We will continue to report on stem cell enforcement issues as the FTC and FDA continue to implement their stepped up enforcement against stem cell therapy claims lacking scientific evidence.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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