Column: A stem cell clinic and its doctor will pay a $3.65-million settlement to 1,100 ex-patients

The story of StemGenex, a onetime stem cell clinic working out of shiny quarters in La Jolla, seems lastly to have reached its well-deserved finish.

A $3.65-million settlement with 1,063 former purchasers reached by the clinic and its former chief medical officer has simply received last approval from federal Choose Anthony Battaglia in San Diego.

The purchasers have been plaintiffs in a class-action lawsuit initially filed in 2016, alleging that they have been misled by StemGenex promoting and promotional materials.

The clinic asserted that its therapy was efficient towards quite a few medical situations, together with the autoimmune illness lupus, diabetes, a number of sclerosis, Alzheimer’s illness and Parkinson’s illness.

Its web site claimed “100% client satisfaction,” though a small disclosure assertion revealed that the determine was based mostly on affected person exit interviews, performed earlier than the outcomes of their therapy could possibly be felt.

The category members will every obtain about $1,936 from the settlement fund, with a lot of the relaxation going to authorized charges and bills. That’s a fraction of the $14,900 price that StemGenex charged per therapy, in keeping with the lawsuit.

Of the overall settlement, $2.5 million might be paid by an insurance coverage provider for Andre Lallande, an osteopath who served because the agency’s chief medical officer, and $1.15 million by the insurance coverage provider for StemGenex.

Nonetheless, the settlement “highlights the large dangers to clinic corporations and particularly their physicians” for promoting unproven stem cell therapies, says Paul Knoepfler, a UC Davis biologist who has tracked the proliferation of unlicensed stem cell clinics for a number of years.

In November, New York Atty. Gen. Letitia James obtained a $5.1-million judgment towards a now-defunct New York Metropolis stem cell clinic for “scamming sufferers out of 1000’s of {dollars} every for unproven and probably dangerous medical therapies involving stem cells.”

Comparable lawsuits from regulators and sufferers may collectively yield tens of tens of millions of {dollars} in settlements and judgments, Knoepfler conjectures. “Given such monetary dangers, how can the a whole lot or 1000’s of clinic docs throughout the U.S. nonetheless maintain getting malpractice or enterprise insurance coverage that they should proceed? In some unspecified time in the future insurance coverage corporations are most likely going to cease protecting this business.”

The StemGenex therapy concerned eradicating fats from the purchasers by liposuction, treating it purportedly to pay attention stem cells from the tissue and injecting the cells again into the purchasers. Not one of the plaintiffs “acquired any vital profit” from the therapy, in keeping with the lawsuit. The 5 named plaintiffs had sought therapy for lupus, a number of sclerosis, diabetes and a spinal wire harm.

There isn’t any scientifically legitimate proof that therapy of the type supplied by StemGenex works as claimed. The Meals and Drug Administration has permitted stem cell therapies just for sure blood-related situations, and in these circumstances solely with stem cells derived from umbilical wire blood.

The company cautions customers towards accepting every other claims for stem cell therapies. Unproven stem cell therapies are “unlawful and probably dangerous,” the FDA says.

StemGenex itself got here beneath FDA scrutiny. The agency acquired a prolonged warning letter in October 2018 from the FDA, asserting that it was in impact advertising and marketing an unlawful drug. The agency’s doubtful sanitary and sterilization procedures raised “potential vital security issues,” the letter stated.

Lallande didn’t reply to a message left at his workplace. Rita Alexander, who had been recognized because the proprietor of StemGenex, couldn’t be reached for remark. As a part of the settlement, neither StemGenex nor Lallande admitted to the allegations within the class motion lawsuit.

“This was not an atypical client case,” Elizabeth Banham, an lawyer for the plaintiffs, instructed me. “The plaintiffs suffered from quite a lot of painful and sometimes degenerative situations for which they paid some huge cash for a stem cell therapy based mostly on the defendants’ advertising and marketing. We’re happy that justice has been obtained for them after 5 years of litigation.”

StemGenex filed for chapter in 2019, claiming belongings of about $156,000 and liabilities of greater than $1 million. The chapter submitting disclosed that the agency had acquired revenues of greater than $8.2 million courting again to the start of 2017.

Based mostly on the agency’s normal price, that advised that the clinic could have had as many as 550 prospects over that interval; some have stated they’d multiple therapy, for which they have been charged separate charges. When the chapter case was closed in January 2021, there was nearly nothing to be distributed to collectors.