Federal Trade Commission Takes Action Against Stem Cell Clinics
Federal Trade Commission Takes Action Against Stem Cell Clinics

Federal Trade Commission Takes Action Against Stem Cell Clinics

The FTC, in its first crack down on the industry, gets two California companies selling unproven treatments to stop their false advertising and pay a fine.

Oct 19, 2018
Ashley P. Taylor

Above: The Federal Trade Commission building in Washington, DC
© ISTOCK.COM, ROMAN BABAKIN

The Federal Trade Commission earlier this month (October 12) filed a complaint in California district court against two stem cell clinics and the physician who runs them, claiming that the companies made unsupported claims about the effectiveness of their therapies. Today, the companies and the FTC have settled the charges, the agency announced in a press release. In the future, the companies will be prohibited from false advertising about their medical services, according to the proposed order (filed October 16) documenting this settlement. They will also pay a penalty. 

This is not the first time that stem cell clinics, of which there are hundreds in the US, have been accused of misleading and unsafe business practices, as STAT notes, but this is the first time that the FTC has taken action against them.

See  “FDA Seeks to Block Two Unregulated Stem Cell Clinics”

The two companies, Regenerative Medical Group and Telehealth Medical Group, both in Orange County, claimed that their “amniotic stem cell therapies” could treat a variety of diseases, including Parkinson’s disease, macular degeneration, cerebral palsy, multiple sclerosis, and heart attacks. They even claimed that the interventions could “reverse autism symptoms” and cure blindness. 

According to the FTC, the companies’ claims are not supported by scientific evidence and therefore violate the FTC Act, which outlaws false advertising and deceptive practices affecting commerce.

“I’m wondering about the future of these and other related businesses,” writes University of California, Davis, biologist Paul Knoepler on his blog, The Niche. “By the way as a stem cell biologist, I’m not aware of any good evidence for the claims that ‘amniotic stem cell therapy’ (whatever that happens to actually be at a particular clinic) can help the conditions mentioned in that quote as being marketed.” 

What are these “amniotic stem cell therapies”? The FTC’s complaint defines them as an “experimental and unproven treatment” that uses stem cells derived from the amniotic fluid of women who have had C-sections. 

The proposed order stipulates that the companies and their CEO, Bryn Jarald Henderson, will be prohibited from misrepresenting products as being able to cure, treat, or mitigate diseases, or state that they can outcompete conventional medicine, unless “competent and reliable scientific evidence” supports the claims. It also imposes a $3.31 million penalty, which will be suspended after Henderson pays the FTC $25,000, which the agency may use to repay customers harmed by the companies’ falsehoods. Finally, the order forces the companies to tell current and former patients about the settlement within 30 days. 

See “Texas Stem Cell Law Opens Door for Controversial Treatments”