Source: https://news.bloomberglaw.com/pharma-and-life-sciences/insight-stem-cell-companies-beware-fda-may-come-knocking
Timestamp: 2020-02-17 03:19:27
Document Index: 342808218

Matched Legal Cases: ['§ 355', '§ 262', '§ 1271', '§ 1271', '§ 1271', '§ 1271']

The FDA has recently been more aggressive in its attempts to regulate stem cell clinics, and is expected to increase its scrutiny in 2019. Axinn, Veltrop & Harkrider attorneys discuss recent enforcement actions and what this growing industry can expect in the coming year.
Although the nascent stem cell industry had been loosely regulated for many years, FDA has recently become more active in pursuing enforcement and requiring preapproval of medical uses of stem cells.
In late 2018, FDA Commissioner Scott Gottlieb announced that the public should “[e]xpect to see brisk activity from the FDA when it comes to some rogue stem cell outfits that are putting patients at risk.” Days later, FDA publicly warned Genentech to cease marketing unapproved stem cell products, and sent letters to other manufacturers and users of stem cell products.
Commissioner Gottlieb’s announcement suggests that FDA’s activity will continue to increase. Manufacturers of stem cell products should expect significantly greater scrutiny by FDA and evaluate whether those products require FDA approval.
Regulatory Paradigm for Stem Cell Products
“Stem cells” refer broadly term to cells that can develop into many different types of cells or tissue. Although the term can refer to embryonic stem cells, most contemporary stem cell therapies typically use stem cells from an adult, often from the patient being treated. Stem cell treatments have shown promise in treating many diseases and injuries.
Federal law requires that most drugs and biologics be approved by FDA prior to marketing. (21 U.S.C. § 355; 42 U.S.C. § 262) Many regenerative medicine products, including human tissue or cell-based products, are instead designated as “human cells, tissues, and cellular and tissue-based products” (HCT/Ps). (21 C.F.R. § 1271.3(d))
HCT/Ps generally have not been subject to FDA approval requirements and some uses of HCT/Ps—most significantly, removal and implantation during a single surgical procedure—are almost entirely exempt from regulation. (21 C.F.R. § 1271.15)
FDA places limited demands on HCT/Ps if they are minimally manipulated, are intended for homologous use, are not manufactured by combining cells with other articles, and are for one of three specified uses: nonsystemic use independent of the metabolic activity of living cells, use in the same patient or a close blood relative, or reproductive use. (21 C.F.R. § 1271.10(a)) HCT/Ps that do not fit these criteria are subject to the full range of FDA regulation and preapproval requirements. (21 C.F.R. § 1271.20)
FDA’s first notable foray into stem cell enforcement came through litigation that was filed in 2010 against Regenerative Sciences. (United States v. Regenerative Scis., LLC, 878 F.Supp.2d 248, 253 (D.D.C. 2012), aff’d, 741 F.3d 1314 (D.C. Cir. 2014).)
Regenerative isolated and cultured mesenchymal stem cells from patients’ bone marrow, which it reinserted into patients. In 2008, FDA warned Regenerative that the resulting stem cell solution was subject to FDA regulation, and inspections in 2009 and 2010 revealed that Regenerative failed to conform to current good manufacturing practices.
The district court held that the stem cell solution was subject to FDA regulation and Regenerative’s procedure was not exempt as the practice of medicine. The court therefore granted FDA’s request for a permanent injunction. The D.C. Circuit affirmed.
Despite the success of its enforcement action, FDA did not engage in further litigation for many years.
FDA Steps Up Its Regulatory Efforts
FDA’s relative inactivity began to change at the end of 2014, with the release of several draft guidance documents pertaining to appropriate uses of stem cells.
In 2017, the agency embarked upon a more aggressive approach towards regulating stem cells: FDA scientists published an article in the New England Journal of Medicine about the uncertain benefits of stem cell treatments; the agency announced a policy framework on regenerative medicine; and Commissioner Gottlieb and FDA Chief Counsel Rebecca Wood stated that FDA would be more aggressive in taking enforcement actions against stem cell clinics.
In retrospect, however, two actions in 2017 stand out as the most telling. In August, FDA sent a warning letter to the US Stem Cell Clinic in Florida and seized several vials of vaccine intended for the California Stem Cell Treatment Center, prominently announcing both on the same date.
The significance of these activities became apparent on May 9, 2018, when FDA sued both clinics. (Complaint for Permanent Injunction, United States v. Cal. Stem Cell Treatment Ctr., No. 5:18-CV-1005 (C.D. Cal. May 9, 2018); Complaint, United States v. US Stem Cell Clinic, LLC, No. 18-CV-61047 (S.D. Fla. May 9, 2018).)
The essentially identical complaints asserted that defendants’ stem cell solutions, which are derived from adipose tissue, are subject to FDA regulation as drugs and as biologics. The defendants have argued that their practices are not subject to regulation, primarily on the basis that isolation and reinjection of stem cells is a surgical procedure.
FDA has made its intentions for stem cell products very clear throughout 2018. In May, referring to the recent lawsuits as examples, Commissioner Gottlieb spoke of FDA’s recently issued policy framework as providing the means for FDA to enforce its premarket approval requirements.
In November, FDA announced it had sent a warning letter to StemGenex Biologic Laboratories, emphasizing StemGenex’s failure to seek FDA premarket approval. A month later, Commissioner Gottlieb told the Food and Drug Law Institute that FDA would continue to increase its enforcement activity.
And, on Dec. 20, after 12 patients became infected after using contaminated umbilical cord stem cell products, FDA sent a warning letter to the manufacturer of these products, Genentech. Commissioner Gottlieb tweeted that “[FDA will] be upping [its] inspections in 2019.” FDA also sent informal letters to inform “manufacturers, health care providers and clinics around the country” that FDA would enforce its premarket approval policies in November 2020.
Stem Cell Industry Should Be Mindful Of FDA
What does all this mean for stem cell producers in 2019? Stem cell clinics should certainly be worried: FDA has specifically targeted them, in both word and deed.
Yet, FDA has increasingly stressed the need for FDA oversight of regenerative medicine, suggesting that other uses of stem cells are also likely to face regulation. Indeed, FDA completed 2018 by sending a warning letter to a major biotech company and by advising other entities to comply with FDA regulations by 2020.
Before bringing a new stem cell based product to market, companies should thoroughly evaluate whether FDA will consider such a product to require premarket approval. Moreover, stem cell companies should proactively address these issues directly with FDA, in order to head off any possible enforcement actions and the accompanying reputational damage.
Chad Landmon is a partner at Axinn, Veltrop & Harkrider LLP, where he chairs the firm’s Food and Drug Administration and Intellectual Property Practice Groups. He regularly works with companies developing drugs, biologics and regenerative medicine and human tissue products.
Jonathan Knowles is an associate at Axinn. At the time of this writing, his admission to the New York bar is pending.