At last: FDA wins permanent injunction against stem cell clinic group

An eight-year dispute between the US Food and Drug Administration (FDA) and a stem cell clinic group has ended after a California court granted the FDA a permanent injunction in the case, with critical implications for stem cell clinics and patients.

In 2025, the US Supreme Court declined to hear the defendants' appeal challenging the FDA's authority to regulate unproven stem cell therapies (see BioNews 1313). This left the previous ruling standing, affirming the FDA's regulatory oversight of stem-cell-based treatments.

The case therefore reverted to the California district court that originally heard it in 2022, where the FDA has finally secured a permanent injunction against the California Stem Cell Treatment Centre (CSCTN), Cell Surgical Network (CSN) and Dr Elliot Lander.

The new court order

The nine-page order, signed by Judge Jesus Bernal, includes several directions, including the following:

• The defendants have 60 days to submit an investigational new drug (IND) application for each product they receive, manufacture, process or distribute. For each IND submitted, if the FDA decides there are no justifications for imposing a clinical hold for that IND, the FDA will inform the defendants that the IND is in force.
• If, however, the defendants violate any applicable requirements, they will cease operations. Any cessation of operations shall continue until the defendants receive notification from the FDA that they appear to comply with the order, the law and the regulations, and they may then resume operations; and the FDA's silence cannot be interpreted as a substitute for notification.
• The order should be posted in a common area of the defendants' facility. Moreover, it should be certified-delivered to each officer, employee and affiliate within 10 days.
• The order authorises the FDA to conduct unannounced inspections and access the buildings to obtain photographs, videos, samples and records. The inspections shall be permitted upon presentation of a copy of the order.
• According to the order, the defendants will bear the costs of FDA's inspections, investigations, supervision, analyses, examinations and reviews that the FDA regards as necessary to assess the defendants' compliance with the order, including transportation and associated costs for the FDA's team of investigators and experts.
• Finally, the order states that the defendants shall abide by FDA's decisions and its decisions shall be final.

Case history

Dr Lander and Dr Mark Berman were California-licensed doctors who co-founded CSCTS, offering stem cell therapies to patients seeking non-surgical alternatives for degenerative disorders.

Their advertisements claimed they had the technology to create a solution from the patients' own stem cells that could cure many conditions, such as cancer, arthritis and macular degeneration. They attracted thousands of patients, who all paid privately because insurance did not cover these procedures. A single procedure costs US$8900, or US$41,500 for a course of 12.

Drs Lander and Berman also operated CSN, a consortium of doctors intending to introduce regenerative medicine into their practices. The affiliates agreed to adopt the defendants' treatment protocol and pricing guidelines, share data, and purchase their tool for cell isolation.

In 2017, the FDA inspected CSCTC clinics and found that they were manufacturing and administering unapproved drug products in violation of FDA's manufacturing requirements. The FDA filed a lawsuit the following year.

In the California district court in 2022, Judge Bernal ruled that the defendants' stromal vascular fraction (SVF) surgical procedure and the expanded mesenchymal stem cells procedure were not drugs under the Federal Food, Drug, and Cosmetic Act (FDCA). As a result, these procedures were not subject to the Act's adulteration and misbranding provisions. Judge Bernal's controversial decision shocked the cell and gene therapy community and created significant uncertainty (see BioNews 1160).

The FDA lodged an appeal. In 2024, the Court of Appeals for the Ninth Circuit reversed the district court judgment, saying that, under the statute's plain text, the defendants' SVF constitutes a drug under the FDCA (see BioNews 1260).

Judges Kim McLane Wardlaw, Michelle Friedland, and Jennifer Sung rejected the defendants' contention that even if the SVF is treated as a drug, the same-day SVF treatment is exempt from FDA regulation under the Same Surgical Procedure exception. The panel acknowledged that the Human Cells, Tissues, and Cellular and Tissue-Based Products (HCT/P) Regulations do not clearly address the exception. They would have to explore the context and structure and interpret the ambiguity in the FDA's favour.

The Court of Appeals decision is binding on the California district court, and it is consistent with the 2021 decision against a Florida stem cell clinic.

Implications

It is a relief and also heartening that the judge's order finally ends the long-standing dispute between the FDA and the defendants. This dispute has been tested to exhaustion, and this order has important repercussions for the stem cell community.

However, Professor Henry (Hank) Greely from Stanford University expressed reservations, saying: 'It's a good thing, but the clinics won't give up. They've come up with a new mix and new name for it and make the same old arguments, hoping to find another Judge Bernal who will buy them.'