June 2, 2021

US Stem Cell clinic loses appeal, could impact pending Cali case?

US Stem Cell clinic loses appeal, could impact pending Cali case?


“We disagree: The procedure does not fall within the first exception because the biological material implanted into the patient is not the same as that removed and the procedure does not fall within the second exception because the Clinic intends the stem cells to perform functions after the procedure beyond the basic functions the stem cells performed prior to the procedure. We therefore affirm the judgment of the district court.”

Different product. As I’ve long said, the adipose stem cells at issue (sometimes called “stromal vascular fraction”, SVF, or just “fat stem cells”) injected into patients is not the same as the cells in fat tissue inside the patient before isolation and processing. SVF does not exist in the body. It’s a lab creation using an enzyme and specific devices.

Making SVF is a complicated process

I both testified in the pending California case and watched a good part of it. I’m hoping to write a post just on that experience soon. In watching material presented in the California case including a step-by-step video of the production of SVF, it seems to me as a stem cell biologist like there are many different processing steps to make SVF.

The Florida and California firms (and other firms across the country in Cell Surgical Network’s chain of clinics) probably do not use exactly the same production protocols, but still these kinds of processes don’t seem trivial to me in general.

For example, the appellate court notes at least 5 steps in the Florida clinic SVF production process.

Non-homologous use. Also, if you are going to market SVF for many diverse medical conditions having nothing to do with fat, then that constitutes what’s called non-homologous use. In other words, the injected SVF is intended by the clinic to do stuff that fat tissue naturally never does. So this leads to a “no” on the second possible exception.

Let me give an example of what I mean here. SVF from fat is often sold by clinics claiming to try to fix joints, treat neurological conditions, ameliorate MS, etc. Belly fat cells inside the body just never do any of that.

Citing “similar” California case

Notably, the federal appellate court also specifically mentioned the ongoing California case against Cell Surgical Network and other defendants:

“The Clinic next draws our attention to the opinion of a district court in California that, in a similar suit against a clinic offering a similar procedure, rejected the FDA’s interpretation under the canon against surplusage…”

It’s important that the court stresses the similar nature of the suits and procedures.

Earlier in this pending California case, Judge Jesus Bernal had rejected the government’s request for summary judgment against the defendants.

In their appeals case, the Florida clinic defendants had noted Bernal’s ruling on the government’s summary judgment motion in the California case. This may have had a big unintended consequence.

Appellate Court disagrees with Bernal?

Now the appellate court seems to have disagreed with Bernal, which could be very significant.

Again, I’m not an attorney so take my reading as that of a biologist, but where the appellate court writes the following about the California case, it seems to go against Bernal’s reasoning on the summary judgment motion:

If significant processing steps expose the HCT/Ps to foreign substances and alter their form prior to reimplantation, then the HCT/Ps cease to be the same as they were at the time of removal. This interpretation seems, at the outset, to be the more natural of the two readings. The FDA’s view is all the more persuasive because it is consistent with its early (as well as its recent) pronouncements”

The appellate court ruling also just generally defers more to the FDA than Bernal seems to have done in his summary judgment motion.

I also think that the appellate ruling from Florida could have meaningful impact on Judge Bernal’s view of the case still before him. The timing here is really interesting. What if the appellate ruling had come after Bernal’s final ruling?

On another level, the appellate court ruling could also impact how the FDA makes its final case to Bernal. It could end up being more persuasive.

Overall, today’s ruling is reason for cautious optimism in how the core issues related to fat stem cell clinics will ultimately be resolved in coming months or years. I just wish things moved more quickly here.  The pandemic certainly didn’t help.



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