FDA’s evolving regulatory position on stem cell therapies

The federal appellate decision in U.S. v. Regenerative Sciences, LLC (see Court upholds FDA’s legal authority to regulate stem cell therapies) also reflects FDA’s evolving legal authority over stem cell services and products, as changing technologies demand more flexible regulatory responses. Regenerative sets forth the regulatory groundwork that undergirds the stem cell industry.

Regenerative Sciences, LLC had developed a “Cultured Regeneexx Procedure” which it exclusively licensed to the inventors’ medical clinic for use in their medical practice. The procedure essentially involved extraction of a sample of a patient’s bone marrow or synovial fluid; isolation of mesenchymal stem cells; placing the stem cells in a solution to culture them (“to cause them to divide and proliferate”) together with other substances to affect the cells’ differentiation. The culturing process “determines the growth and biological characteristics of the resulting cell population.” Doxycycline gets added to prevent bacterial contamination, and the resulting mixture is then injected into the patient at the site of the damaged tissue.

Defendants–the company, its majority physician shareholders, its lab director, and the medical clinic–marketed the Procedure to treat orthopedic injuries and arthritis and musculoskeletal and spinal injury.

Legal Definitions of “Drug” and “Biologic” vs. the “Practice of Medicine”

It is true that the 10th Amendment to the U.S. Constitution assigns to the states the power to regulate health, safety, welfare and morals, and that FDA does not have jurisdiction over the practice of medicine, which is subject to the authority of state medical boards and other state regulatory authorities.

However, it is easy for activities to be seen as spilling over from a localized practice of medicine into a service or promotion of a product in interstate commerce that does trigger FDA jurisdiction.

The controlling statutes are the federal Food, Drug & Cosmetic Act (FDCA), 21 USC 301 et seq., and the Public Health Service Act (PHSA), 42 USC 201 et seq. These two statutes “promote the safety of drug and biological products, respectively, by setting forth detailed requirements for how such substances are to be manufactured and labeled…. Drugs and biological products not satisfying those requirements are deemed ‘adulterated’ or ‘misbranded’ … and doing any act that causes a drug or biological product to be adulterated or misbranded is a violation of federal law.”

As we noted in our prior blog post (Court upholds FDA’s legal authority to regulate stem cell therapies), the Court dismissed defendants’ argument that the Procedure is neither a drug nor a biological product, but rather, a medical procedure. The Court cited the broad definition of “drug” in the FDCA as any article “intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease” or “intended to affect the structure of any function of the body.” The therapeutic claims above were more than sufficient to show an intended use to treat or mitigate disease. Note that FDA looks to all the advertising material, including website, brochures, pamphlets, and statements by the company, for evidence of intended use.

The Court also cited the definition of “biological product” in the PHSA as any “virus, therapeutic serum, toxin, antitoxin, vaccine, blood, blood component or derivative … or analogous product … applicable to the prevention, treatment, or cure of a disease or condition of human beings.”

The Court dismissed the argument that defendants were engaged only in the “practice of medicine,” as a “syllogism … flawed twice over.” First, the Court noted that FDA had stated that it was regulating the Mixture, and not simply a medical procedure. Second, the Court noted the breadth of the FDCA as a “comprehensive, uniform regulatory scheme for the distribution of drugs,” which “carves out certain exceptions from its requirements for doctors who manufacture and administer drugs in the course of professional practice.”

The Court also invoked federalism cases that grant federal government a broad reach into localized activities (such as federal laws prohibiting the possession of home-grown marijuana intended solely for personal use), and emphasized that the Mixture “undoubtedly ha[s] effects on interstate markets for orthopedic care.”

As well, the doxycycline is shipped in interstate commerce. Game over.

The HCT/P Regulations

HCT/P regulations, in 21 CFR Part 1271, define HCT/Ps as “articles containing or consisting of human cells or tissues that are intended for implantation, transplantation, infusion, or transfer into a human recipient.” According to the court, HCT/Ps may qualify as drugs or biological products, and be regulated under the FDCA, PHSA, and corresponding regulations.

Significantly, the HCT/P regulations create a regulatory exemption from the manufacturing and labeling requirements that normally apply to drugs and biological products, for any HCT/P that is no more than “minimally manipulated” (21 CFR 1271.10(a). This means “processing that does not alter the relevant biological characteristics.” 21 CFR 1271.3(f)(2). FDA’s concern here is the risk of spreading disease through, for example, errors in “labeling, mixups of testing records, failure to adequately clean work areas, and faulty packaging.”

By admitting that the cultural process is designed to determine the growth and biological characteristics of the stem cell population, and that they added substances to the cell culture to affect the differentiation of bone marrow cells, defendants essentially conceded that they had engaged in more than minimal manipulation. Again, game over. Or as the Court put it, these “concessions are fatal to appellants to claim refuge under Section 1271.10(a)” of the HCT/P regulations (which speaks to “minimal manipulation”).

Adulteration and Misbranding

After dispensing with defendants’ argument that what they have is a compounded drug, the Court turns to adulteration, and finds that the methods used by Regenerative do not conform to current good manufacturing practice.

And the Court also finds misbranding, because the Mixture is a prescription drug which can only be administered under physician supervision, and its labeling does not provide adequate directions for use and the Rx only symbol.

The end result is that the Court upholds the lower court’s decision in finding that defendants adulterated and misbranded the Mixture, and in upholding a permanent injunction to prevent future violations of the FDCA’s manufacturing and labeling provisions.

The Bottom Line

Regenerative not only lays out the legal and regulatory foundation for stem cell practices, it also indicates FDA’s expansive authority over the stem cell industry.

The bottom line is this:

1. FDA maintains that a stem cell product cannot get to market unless it is either approved by FDA or studied under a clinical investigation that has been submitted and allowed to proceed by FDA. FDA takes responsibility for regulating stem cell therapies to ensure they are safe and effective for their intended use. FDA’s authority is very broad, as is the interpretation of what constitutes “interstate commerce” (over which FDA has jurisdiction).
2. FDA approval of stem cell products to date is very limited, although the technology is constantly being upgraded and we may see additional approvals down the road.
3. The HCT/P regulations create a unified registration and listing system for establishments that manufacture human cells, tissues, and cellular and tissue-based products and to establish donor-eligibility, current good tissue practice, and other procedures to prevent the introduction, transmission, and spread of communicable diseases by HCT/Ps.
4. However, the HCT/P regulations provide that an HCT/P is regulated solely under section 361 of the PHSA and the HCT/P regulations if:
   • the HCT/P is “minimally manipulated” (essentially, does not alter the original relevant characteristics);
   • the HCT/P is intended for homologous use only (repair, reconstruction, replacement, or supplementation of a recipient’s cells or tissues with an HCT/P that performs the same basic function or functions in the recipient as in the donor);
   • the manufacture of the HCT/P does not involve the combination of the cells or tissues with another article, with certain exceptions and provided that the combination does not raise new clinical safety concerns; and
   • the HCT/P does not have a systemic effect and is not dependent upon the metabolic activity of living cells for its primary function, or the HCT/P has a systemic effect or is dependent upon the metabolic activity of living cells for its primary function. 21 CFR 1271.10. The HCT/P regulations also provide for limited exceptions (21 CFR 127.15).
5. According to the Regenerative decision, culturing stem cells affects their characteristics, thus removing the product from the “minimally manipulated” exemption.
6. FDA enforces it rules regarding adulteration and misbranding against stem cell manufacturers.
7. A domestic or foreign establishment that manufactures an HCT/P described above (in 1271.10(a) must:
   • register with FDA
   • submit to FDA a list of each HCT/P manufactured; and
   • comply with other requirements.

As noted in our post on FDA regulation of stem cell therapies, FDA currently says very little on its website other than warn consumers of unapproved stem cell therapies. At the moment, we’re left with the Regenerative opinion, relevant portions of the FDCA and PHSA, and the HCT/P regulations. Expect to see further developments as industry continues to push the envelope. And contact our FDA legal team for counsel regarding stem cell therapeutic projects and services.