Nursing Home Patient’s Family Can’t Revive Axed Jury Win

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By Y. Peter Kang
January 17, 2018

Law360, Los Angeles (January 17, 2018, 8:54 PM EST) — A Florida appellate panel on Wednesday affirmed a trial judge’s decision to overturn a jury verdict in favor of the son of an elderly woman who allegedly died because of a nursing home’s negligence, saying the plaintiff’s medical expert’s opinion was contradicted by the evidence.

In a 2-1 ruling, a three-judge panel for the Third District Court of Appeal upheld the trial judge’s decision to set aside a jury’s verdict in favor of Robert Siegel in a suit accusing Cross Gardens Care Center LLC of providing negligent care for his mother, Sybil Siegel, which purportedly contributed to her death at the age of 88. The majority said Siegel’s medical expert, Dr. Lee Fisher, submitted a medical opinion that was contradicted by the patient’s medical records and that therefore his opinion should never have been presented to the jury.

The appeals court said the burden was on Robert Siegel to prove that the alleged negligence “more likely than not” caused the patient’s death.

“An examination of Dr. Fisher’s opinions indicates that, time and again, he drew inferences from the medical records that were not more-likely-than-not,” the 12-page majority opinion states. “Indeed, at critical points, his opinions are directly contradicted by the very medical records upon which they are purportedly based.”

In Fisher’s opinion, Sybil Siegel died of pneumonia and the nursing home’s medical staff had failed to properly monitor her and order her timely transfer to a hospital, but the panel said the doctor makes this assumption based on the fact that there were no entries in the nurse’s notes for a two-week period.

“The problem with this inference is that it is contradicted by the raft of medical reports indicating that Ms. Siegel’s condition was being constantly monitored, recorded, and reported throughout that period,” the majority said. “Dr. Fisher’s inference that the ‘gap’ in the notes signified that she was not monitored is worse than speculation: it is contradicted by the only evidence Dr. Fisher or the jury had.”

The majority also took issue with Fisher’s theory that Siegel could have lived for an additional three years had she received timely treatment, an assessment based on the fact that she had been previously hospitalized for pneumonia and survived.

“This is a total non sequitur,” it said. “It does not follow that because a person was admitted with pneumonia at age 60, 70, or 80 and survived that she will necessarily survive if she is admitted with pneumonia at age 88.”

The panel noted that Fisher never personally examined the patient so his assertion that she died of pneumonia is contradicted by the medical records, which state that the patient’s official cause of death was end-stage dementia and end-stage chronic obstructive pulmonary disease.

“Dr. Fisher’s opinion that pneumonia caused her death, which is based entirely on the medical records, but which is flatly contradicted by the medical records, is entitled to no evidentiary weight,” the court said.

In a dissenting opinion, Judge Robert J. Luck voted to reinstate the jury’s verdict, saying the legal principles for reviewing judgments notwithstanding the verdict does not allow the court to reweigh testimony and choose between conflicting evidence.

“After reviewing the conflicting records, listening to Dr. Fisher’s direct and cross-examination, and hearing the attorneys’ arguments during closing about why he should and shouldn’t be believed, the jury credited Dr. Fisher’s testimony in finding that the nursing home violated chapter 400, which caused the Siegel family’s injuries,” Luck said. “We should not reweigh Dr. Fisher’s testimony and substitute our view for the jury’s.”

Siegel had sought nearly $500,000 in damages, but the jury awarded a sum of approximately $6,100.

An attorney for the nursing home said he was pleased with the appellate ruling.

“We think the trial court and the Court of Appeal got it right,” said Christopher M. David of Fuerst Ittleman David & Joseph PL. “We think this opinion will go a long way in relieving nursing homes of being forced to prove negatives when defending themselves in court.”

An attorney for Siegel declined to comment on Wednesday.

Judges Thomas Logue, Edwin A. Scales III and Robert J. Luck sat on the panel for the Third District.

Siegel is represented by Douglas F. Eaton of Eaton & Wolk PL.

The nursing home is represented by Christopher M. David, Michael B. Kornhauser and Jeffrey J. Molinaro of Fuerst Ittleman David & Joseph PL.

The case is Robert Siegel v. Cross Senior Care Inc. et al., case number 3D16-600, in the Third District Court of Appeal, Florida.

–Editing by Jill Coffey.

Recent Conviction of Medical Marijuana Distributor Highlights Continuing Federal Efforts To Prosecute Medicinal Marijuana Under The CSA

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On January 7, 2013, Aaron Sandusky, operator of three medicinal marijuana dispensaries in Southern California, was sentenced to ten years in federal prison for violating federal drug laws. Sandusky’s conviction highlights the interplay between State and Federal law and provides an example of how operators of medicinal marijuana dispensaries still face the threat of federal prosecution even though their activities may fully comply with State law.

As we have previously reported, in spite of the fact that 18 States have sanctioned the use of marijuana in various forms, the federal government has proceeded unchecked in its efforts to criminalize the entire industry. More specifically, marijuana remains classified as a Schedule I drug under the Controlled Substances Act (“CSA”), 21 U.S.C. § 801 et seq, which means that marijuana has been found by Congress to: 1) have a high potential for abuse; 2) have no currently accepted medical use in treatment in the US; and 3) lack accepted safety for use under medical supervision. Therefore, although it may be legal under state law to possess cultivate, and/or distribute marijuana, such actions still violate federal law.

For example, in Gonzales v. Raich, 545 U.S. 1 (2005), the Supreme Court directly addressed the issue of whether Congress, pursuant to its Commerce Clause authority, could regulate and prohibit the local cultivation of marijuana which complied with California state law. In holding that the CSA’s prohibition of locally grown and used marijuana was permissible, the Court found that Congress had a rational basis for concluding that local marijuana substantially affects interstate commerce. The Court found that Congress can regulate purely intrastate activity that is not itself “commercial,” i.e., not produced for sale, if it concludes that failure to regulate that class of activity would undercut the regulation of the interstate market in that commodity. The Court went on to find that due to the inability to distinguish or prevent locally cultivated marijuana from entering the interstate market, the failure to regulate it would undermine the purposes of the CSA as a whole.

In addition to prosecutions for violating federal law, federal authorities have used various other techniques in an attempt to quash the burgeoning medical marijuana industry. Such techniques include the use of civil asset forfeiture pursuant to 21 U.S.C. § 881 and disallowing medicinal marijuana dispensaries from taking business deductions pursuant to 26 I.R.C. §  280E. More information regarding the joint Department of Justice and Internal Revenue Service efforts can be read in our previous report.

In this case, Mr. Sandusky was charged with: 1) conspiracy to manufacture and possess marijuana with intent to distribute it, 2) conspiracy to operate a drug-involved premises and 3) possession of marijuana with intent to distribute it. Sandusky was ultimately convicted in October 2012. While Mr. Sandusky faced a maximum of life in prison, United States District Court Judge Percy Anderson sentenced Sandusky to ten (10) years in prison, the federal mandatory minimum for such charges.

Mr. Sandusky’s case is the fourth nationwide where federal prosecutors have filed charges against medical marijuana dispensary owners in states where such dispensaries comply with State law. The other prosecutions previously occurred in California, Michigan, and Montana. Additionally, because marijuana sale and distribution violates federal laws prohibiting drug trafficking, dispensary owners face the possibility of other separate yet interrelated federal charges. The Montana indictment of Christopher Williams is an example of this. As the Helena Independent Record reports, in addition to being charged with conspiracy to grow and distribute marijuana, Williams was also charged with possession of a firearm during a drug-trafficking offense. Williams currently faces five years to life in federal prison and is scheduled to be sentenced February 1, 2013.

The attorneys at Fuerst Ittleman David & Joseph, PL have extensive experience dealing with administrative law, regulatory compliance, and white collar criminal defense. You can reach an attorney by emailing us at contact@fidjlaw.com.

59 individuals indicted in the Southern District of Florida in response to Medicare Fraud Strike Force investigation

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On May 1, 2012,  Wifredo A. Ferrer, United States Attorney for the Southern District of Florida, John V. Gillies, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office, Christopher B. Dennis, Special Agent in Charge, U.S. Department of Health and Human Services, Office of Inspector General (HHS-OIG), and Henry Gutierrez, Postal Inspector in Charge, U.S. Postal Inspection Service, Miami Division, announced that fifty-nine (59) South Florida residents were charged for their alleged participation in various schemes to defraud Medicare out of more than $137 million.

The charges in South Florida are part of a nationwide takedown by Medicare Fraud Strike Force operations in seven cities that resulted in charges against 107 individuals, including doctors, nurses and other licensed professionals, for their alleged participation in Medicare fraud schemes involving approximately $452 million in false billing. This coordinated takedown involved the highest amount of false Medicare billings in a single takedown in Strike Force history.

The specific indictments include:

U.S. v. Odalys Fernandez, Kelvin Soto, Yumidia Naranjo, Jose Guerra, Yanuris Lima, and Servando Raya, Case No. 12-20230-CR-Ungaro

In this six defendant case, two registered nurses employed by Ideal Home Health (Odalys Fernandez and Kelvin Soto) are charged with conspiracy to commit health care fraud for purportedly providing services, such as skilled nursing and physical therapy, to homebound beneficiaries.

U.S. v. Eulises Escalona, Case No. 12-20293-CR-Lenard

This indictment charges Eulises Escalona with one count of conspiracy to commit health care fraud, one count of conspiracy to defraud the United States and to receive and pay health care kickbacks, and five counts of payment of health care kickbacks stemming from a $42 million home health care fraud scheme.

U.S. v. Rodolfo Nieto, Jr., Case No. 12-20290-CR-Altonaga

This indictment charges Rodolfo Nieto, Jr., owner and operator of Ronat Home Health Care, Inc. (Ronat), with one count of conspiracy to defraud the United States and to receive and pay health care kickbacks and three counts of receipt of kickbacks for his participation in a $60 million home health care fraud scheme.

U.S. v. Maggie Leon, Yuderkis Pena Garcia and Eduardo Vilau, Case No. 12-20274-CR-Seitz

In this case, defendants Maggie Leon, Yuderkis Pena Garcia and Eduardo Vilau, owners of Leon Medical and Leah Medical, were charged with conspiracy to commit health care fraud and health care fraud for submitting false claims to private insurance companies that were Medicare Advantage contractors under Part C of the Medicare program.

U.S. v. Ricardo Martinez, Case No. 12-20316-CR-Martinez

This indictment charges defendant Ricardo Martinez with health care fraud and paying kickbacks to patients.

U.S. v. Yaquelin Colls, Pedro Colls, and Jesus Fernandez, Case No. 12-20315-CR-Seitz

This indictment charges defendants Yaquelin Colls, Pedro Colls, and Jesus Fernandez with conspiracy to commit health care fraud, substantive health care fraud, conspiracy to pay health care kickbacks, and substantive charges of paying kickbacks.

U.S. v. Roberto L. Valdes Gonzalez, Francisca Gema Valdez, Gilberto Faure, and Alberto Sotolongo, Case No. 12-20275-CR-Moore

In this case, defendants Jose L. Valdes Gonzalez, a/k/a “Roberto Gonzalez,” Alberto Sotolongo, a/k/a “Ruben,” Gilberto Faure, and Francisca Gema Valdes were charged with conspiracy to commit health care fraud and substantive counts of health care fraud in connection with the operation of Ilva Pharmacy, Inc.

U.S. v. Alina De Armas, Case No. 12-20282-CR-Zloch

In this case, defendant Alina De Armas is charged with health care fraud and with paying kickbacks to patients.

U.S. v. Isaura Bou-Melendez and Gricel Font, Case No. 12-20113-CR-MGC

In this case, Isaura Bou-Melendez and Gricel Font are charged with conspiracy to commit health care fraud. Bou and Font, licensed therapists, owned and operated a comprehensive outpatient rehabilitation facility, Font & Bou Rehab Associates, Inc.

U.S. v. Maritza Claudia Fernanda Lorza Ramirez, and James Arley Velasco Gonzalez, Case No. 12-60090-CR-KMW

This indictment charges defendants Maritza Lorza Ramirez and James Velasco Gonzalez with conspiracy to commit money laundering and substantive counts of money laundering.

U.S. v. Orlando Conrado Piedra Jr., Case No. 12-60091-CR-KMW

This indictment charges Orlando Piedra, an accountant, with conspiracy to commit money laundering and substantive counts of money laundering.

U.S. v. Armando “Manny” Gonzalez, John Thoen, Wondera Eason, Paul Thomas Layman, Alexandra Haynes, Serena Joslin, Ivon Perez, Daniel Martinez, Raymond Rivero, Case No. 12-20291-CR-Altonaga

Armando “Manny” Gonzalez, John Thoen, Wondera Eason, Paul Thomas Layman, Alexandra Haynes, and Serena Joslin are charged with one count of conspiracy to commit health care fraud through a company called Health Care Solutions Network (HCSN).

U.S. v. Sarah Da Silva Keller, Case No. 12-20289-CR-Cooke

Sarah Da Silva Keller is charged with one count of conspiracy to commit health care fraud.

U.S. v. Alba Serrano, Case No. 12-20285-CR-Seitz

Alba Serrano is charged with one count of conspiracy to commit health care fraud.

U.S. v. Bobby Ramnarine, Case No. 12-20288-CR-Middlebrooks

Bobby Ramnarine is charged with one count of conspiracy to commit health care fraud.

U.S. v. Giuseppe Pellerito, Case No. 12-20292-CR-Cooke

In this case, defendant Giuseppe Pellerito is charged with conspiracy to receive health care kickbacks and substantive counts of receiving kickbacks.

U.S. v. Hassan Collins, Case No. 12-20286-CR-Moore

Hassan Collins is charged with one count of conspiracy to pay and receive health care kickbacks.

U.S. v. Jean Luc Veraguas, Case No. 12-20287-CR-Moreno

Jean-Luc Veraguas is charged with one count of conspiracy to commit health care fraud.

U.S. v. Pablo Orama, Vivian Augustine, a/k/a Vivian Salazar, Ariane Marchioro Amorim, Jose Orelvis Ortega, Marlen Diosdada Garcia, Ivon Perez, Marianela Terrero, Jose Abreu-Gonzalez, Elba M. Caicedo, Carlos A. Herrera, Marisela Sherwood, Nancy Diaz, Daymi Fuentes Gil, Olga Martinez Rodriguez, Yuria Perez Rivero, and Joel Loyola, Case No. 12-20265-CR-Middlebrooks(s)

In this case, sixteen defendants are charged with conspiracy to pay and receive health care kickbacks and substantive counts of paying and receiving kickbacks in connection with a federal health care program.

U.S. v. Jorge Luis Reyes and Waldo Gonzalez, Case No. 12-14030-CR-Moore

This indictment charges Jorge Luis Reyes and Waldo Gonzalez, owners of a medical clinic that purported to treat HIV-positive Medicare beneficiaries at locations in Miami-Dade and St. Lucie Counties.

U.S. v. Manotte Bazile, Case No. 12-20284-CR-Lenard

Defendant Manotte Bazile, a former social worker and licensed intern at Biscayne Milieu, was charged with health care fraud conspiracy for purportedly treating patients who did not qualify for PHP treatment.

U.S. v. Roselyn Nicole Charles, Case No. 12-20283-CR-Ungaro

Defendant Roselyn Nicole Charles, a former patient recruiter at Biscayne Milieu, was charged with conspiracy to pay health care fraud kickbacks.

The full U.S. Attorneys Office press release is available here

http://www.justice.gov/usao/fls/PressReleases/120502-01.html

The attorneys at Fuerst Ittleman have extensive federal criminal experience at the trial and appellate levels, including fraud and health care fraud.  You can contact an attorney for a confidential meeting by calling us at 305.350.5690 or by emailing us at contact@fidjlaw.com.

U.S. Court of Appeals for the Second Circuit Overturns Gen Re and AIG Convictions

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On Monday, August 1, 2011, the U.S. Court of Appeals for the Second Circuit overturned the 2008 convictions of four former executives of General Reinsurance Corporation (Gen Re) and one from American International Group (AIG). The Courts opinion can be found here.

In overturning the convictions, the Court declared that the trial judge erred in allowing prosecutors to offer evidence that was prejudicial to the executives and in improperly instructing the jury on causation. The Court ordered new trials for Ronald Ferguson, Gen Res former chief executive; Elizabeth Monrad, Gen Res former chief financial officer; Christopher Garand, Gen Res former senior vice president; Robert Graham, Gen Res former assistant general counsel; and Christian Milton, AIGs former vice president.

The five executives were accused of defrauding AIG investors early in the last decade by almost $600 million by masking losses to AIG. AIG later became known to the general public as a big beneficiary of the federal bailout, receiving $182.3 billion. The criminal case against the defendants arose out of investigations in 2005 by the Securities and Exchange Commission and the New York State Attorney Generals office into AIGs accounting. Prosecutors claimed the alleged fraud on the AIG investors centered on a “sham transaction to inflate AIGs loss reserves by $500 million, which preceded by several years the financial crisis of AIG.” The defendants were convicted of conspiracy, mail fraud, securities fraud and making false statements to the Securities and Exchange Commission and sentenced to terms ranging from one to four years.

However, the three-judge federal appeals court panel said that the trial judge erroneously let prosecutors display three charts with misleading AIG stock-price data. In its 77-page opinion, the panel said that the charts suggested that the “sham transaction” caused AIGs shares to plummet 12 percent during the relevant time period, and that suggestion was without foundation. The charts cast the defendants as causing an economic downturn affecting every family in America.

The Court ordered new trials for the defendants, causing a significant setback to the Department of Justice. The initial convictions in 2008 were seen as a milestone in the governments efforts to prosecute white-collar crime. However, recently, the government has declined to pursue or has failed to win convictions in a number of high-profile cases, particularly those stemming from the financial crisis.

For more information regarding Fuerst Ittlemans white collar criminal defense practice, contact an attorney today at contact@fidjlaw.com.

IRS Disagrees with TIGTA Report That Finds IRS Control Procedures and Employees To Be Ineffective

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Following its audits of the Internal Revenue Services (IRS) Large and Mid-Size Business (LMSB) and Small Business/Self Employed(SB/SE) Divisions, the Treasury Inspector General for Tax Administration (TIGTA) recently released its findings regarding the “the effectiveness of controls and procedures” utilized by the two Divisions. Among other reasons, these audits were conducted “to ensure tax returns with Abusive Tax Avoidance Transaction (ATAT) issues are properly examined for abusive tax avoidance.” The full report is available here.

ATAT is defined by the IRS as “a specific tax transaction/promotion that reduces a tax liability by taking a tax position that is not supported by tax law or manipulates the law in a way that is not consistent with the intent of the law.” The IRS seeks to stop the marketing and promotion of ATATs by completing investigations of the individuals or businesses that promote these schemes, as well as the promoter clients who participate in the schemes. As the taxpayers falling under the LMSB and SB/SE divisions are the primary targets of those individuals or entities promoting ATATs, both divisions have established offices dedicated to the ATAT Program.

TIGTA expressed numerous concerns regarding the effectiveness of these offices, specifically pointing out conflicts between the procedures utilized by the officers with the taxpayers rights. TIGTA found that IRS employees made decisions to survey tax returns without proper approval or adequate justification, often while “jeopardizing taxpayers rights.”

Specific findings from a statistical sample of 311 surveyed returns included:

  • TIGTA determined 246 of the 311 returns were subject to guidelines requiring approval from the Planning and Special Programs function to survey the tax return. Of these 246 returns, 238 (97 percent) were surveyed by group managers without the requisite approval.
  • 88 of the 311 surveyed tax returns did not include any justification in the case files as to why the tax return was surveyed.
  • For 278 (89 percent) of the 311 surveyed tax returns, TIGTA found that IRS employees did not follow procedures when surveying tax returns with ATAT issues.

In the IRSs response, Commissioner of the SB/SE Division, Christopher Wagner acknowledged that the applicable procedures were not always followed, but indicated that deviation from procedure did not mean that the IRS was not effective in its decisions to survey tax returns.

While our cases did not always conform to the prescribed documentation procedures, we found no cases where the decision to survey was improper. Many of the cases reviewed during this audit involved highly complex transactions. As noted above, in these cases, the IMT and the ATTI staff worked closely with the area managers, examiners, and PSP staffs to ensure survey decisions were consistent and appropriate.

TIGTAs report also emphasized a direct conflict with taxpayers rights, specifically in numerous instances when the IRS surveyed tax returns after contacting taxpayers. With regard to this concern, TIGTA recommended:

The Director, Examination, SB/SE Division, should strengthen existing controls to protect the rights of taxpayers by ensuring examinations of ATAT cases are completed once taxpayers, or their representatives, have been contacted by IRS employees.

The IRS disagreed with this recommendation, indicating that surveying tax returns after taxpayer or representative contact was permissible according to the Internal Revenue Manual. Relying on IRM §4.10.2.5.1(3), the IRS found no issue with the procedure utilized by its employees.

Included in TIGTAs report, however, is TIGTAs Office of Audit Comment, which points out that the cited provision, IRM §4.10.2.5.1(3), was not effective until April 2, 2010, and the tax returns in TIGTAs sample were all surveyed during 2006 through 2008. Thus, TIGTA projected that the IRS employees violated the rights of as many as 196 taxpayers.

We previously reported recent actions of the IRS that reveal its disregard for taxpayer rights and privacy in our discussion of the newly enacted regulations requiring Uncertain Tax Position (UTP) disclosures. Here, the IRSs response to TIGTAs report reinforces this lack of concern, and portrays its growing approval of IRS employees intentionally violating procedures designed to protect the rights of taxpayers.

If you have any questions regarding TIGTAs report, IRS procedures and examinations, or any other tax provision, please contact Fuerst Ittleman, PL at contact@fidjlaw.com.

Feds Challenge Stem-Cell Treatment

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WASHINGTON (CN) – The Department of Justice says a stem-cell treatment to rebuild hips, knees and other joints has been misbranded by its manufacturer, Regenerative Sciences, and violates standards of the federal Food, Drug, and Cosmetic Act.

Colorado-based Regenerative Sciences calls the cultured stem cells used in the company’s Regenexx procedure a “cultured cell product,” while the FDA claims the cell product should be considered a drug. The Regenexx procedure involves taking cells from a patient’s bone marrow, processing the cells with the patient’s blood, then reinjecting the “product” into the patient.

The cultured cells should be classified as a drug, the government says, as they end up in a syringe to be injected back into the patient.

“Defendant’s cultured cell product is a ‘drug’ within the meaning of the FDCA, because Defendant’s labeling and promotional literature, including information contained on Regenerative Sciences’ website, establish that their cultured cell product is intended to be used in the cure, mitigation, and treatment of diseases in man and to affect the structure and function of the body,” says the government in its complaint.

Dr. Christopher Centeno, Regenerative Sciences’ acting CEO and defendant in the case, disputes the FDA’s claims that the product is a drug.

“This is about patients. We don’t dislike [the FDA] and respect its authority over drug production. However, we also believe a physician has the right to use stem cells or other body parts to help heal the patient, especially when it’s a better alternative to more invasive procedures,” says Dr. Centeno.

He says making a patient’s own stem cells a drug “won’t add measurable safety, but it will hugely increase cost and delay helping patients find better options for their medical problems.”

According to the FDA, if the cultured cell product is a drug, then Regenerative Sciences is not following the guidelines of “current good manufacturing practice.” The agency says its nearly two-month investigation of the company’s Colorado facilities “showed that the methods used in, and the facilities and controls used for, the manufacture, processing, packing, or holding of the cultured cell product do not conform to and are not operated or administered in conformity with current good manufacturing practice.”

Among the violations, the FDA says, Regenerative Sciences failed “to perform appropriate laboratory testing of each batch of drug product required to be free of objectionable microorganisms.”

The government says the company promised to correct some violations, “but they refused to correct many others because they do not believe that Regenerative Sciences is a drug manufacturer.”

“Regenerative Sciences has had an exemplary safety record, showing that our procedure is far safer than the knee replacements it has helped patients avoid,” Centeno says.

The company has sued the FDA four times in two years, trying to get a decision that the cultured cell product is “the practice of medicine” and not a drug, he explained in an interview with Courthouse News.

Colorado Medical Clinic Welcomes Opportunity to Fight FDA in Court

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Clinic Claims FDA Has Repeatedly Overstepped Regulatory Authority

DENVER, Aug. 9 /PRNewswire/ — Regenerative Sciences, Inc., a Colorado medical practice that specializes in the use of a person’s own stem cells to help patients avoid more invasive orthopedic surgery, announced today that the US Food and Drug Administration (FDA) is seeking to enjoin the clinic physicians from practicing medicine using patients’ own stem cells. The lawsuit will allow Regenerative Sciences to question the FDA’s policy that adult stem cells can be classified as drugs when used as part of a medical practice.

“The FDA will finally answer our questions, in court, about their claims and jurisdiction as opposed to doing everything in their power to avoid the issue that we are not a drug manufacturer, but simply a medical practice,” said Christopher Centeno, M.D., Regenerative Sciences’ medical director.

The FDA claims that Regenerative Sciences is using an “adulterated” product because it fails to follow mass manufacture guidelines in its medical practice that is applied to drug factories producing millions of doses. Rather than mass producing drugs, Regenerative Sciences uses the patient’s own stem cells to treat common orthopedic problems. Regenerative Sciences has had an unblemished safety record, recently publishing a large study showing that its procedure is dramatically safer than the traditional surgical procedures it has helped many patients avoid. Regenerative Science’s lab has strictly adhered to the International Cellular Medicine Society’s (ICMS) strict, professional guidelines and has been audited three times by independent third parties with no serious safety concerns.

“ICMS lab guidelines are the best fit for autologous cell processing and provide strong patient protection. If the FDA had any valid concerns about our medical practice not using drug factory guidelines, they knew about that in Spring of 2009 and did nothing. They did nothing because there were no safety issues. Their focus on this now is litigation posturing,” stated Centeno.

Regenerative Sciences has been using its patients’ stem cells to treat orthopedic conditions since 2005 and received an untitled letter from the FDA in 2008 claiming its medical procedure was creating a new biologic drug. The FDA inspected Regenerative Science’s facility in 2009, and found, at that time, that it was not compliant with drug mass manufacture guidelines, but failed to take any action.

Regenerative Sciences has filed two lawsuits against the FDA in an effort to force the organization to respond to questions about their jurisdiction in the matter. The medical practice filed a suit in Denver District Court in 2008 based on the issue that the FDA regulations regarding creating a drug out of the patient’s own stem cells exceeded the FDA’s congressional authority and that the Food, Drug, and Cosmetic Act contains exemptions for physicians using innovative therapies that do not go through FDA approval as part of their medical practice. Last month, Regenerative Sciences was forced to file suit against the FDA again, this time seeking a Temporary Restraining Order (TRO) to prompt the FDA to take “final agency action” or leave its medical practice alone following an exhaustive inspection of Regenerative Science’s facilities and taking no action.

“For two years we’ve been prodding the FDA to respond to our questions about how it has the ability to regulate a medical practice, so we’re encouraged that, as a result of this recent suit, the courts will decide if it the FDA has regulatory authority over the adult stem cells that live in everyone’s body,” stated Centeno. “This is an important case for everyone that suffers from any type of illness, not just patients with orthopedic problems. It will decide, once and for all, if the government has the right to restrict a patient and their doctor from using a person’s own stem cells to treat disease. Regenerative Sciences believes that stem cells are body parts and not the property of the government or big pharma.”

Adult stem cells are those found throughout the patient’s body. Recent medical research has indicated these important cells have as much clinical promise as the more controversial embryonic stem cells (cells taken from an embryo).

“What we’re doing in our Colorado medical practice is no different, in principle, than a fertility clinic that uses the in-vitro fertilization technique. The only difference is that we’re using stem cells and fertility clinics use fertilized eggs,” stated John Schultz, M.D., one of the founders of the Centeno-Schultz Clinic.

The FDA’s lawsuit is being closely monitored by the International Cellular Medicine Society (ICMS), a global nonprofit dedicated to patient safety and education in the medical use of adult stem cells that represents over 1,000 physicians, researchers and patients from over 35 countries on 6 continents. ICMS executive director, David Audley, stated “The Centeno-Schultz Clinic meets our strict criteria for the safe therapeutic use of adult autologous stem cells. There is more medical and scientific evidence supporting this type of medical therapy for orthopedic conditions, for example, than there is for many approved drugs that the FDA allows to be used in off-label or unconventional applications.”

About Regenerative Sciences

Headquartered in Colorado, Regenerative Sciences, Inc. is an extension of the medical practice of the Centeno-Schultz clinic and is focused on the development of the Regenexx┞¢ procedure, a breakthrough non-surgical option for people suffering from various orthopedic disorders. The physicians at Regenerative Sciences have developed a patent-pending procedure that uses a person’s own stem cells and blood growth factors to help regenerate bone and cartilage. Regenerative Sciences believes in educating patients, providing choices, offering options and encouraging people to take an active role in their own treatment. More information can be found at http://www.regenexx.com

SOURCE Regenerative Sciences, Inc.

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Orthopedic Implant Companies Out of Fed Oversight

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Four primary orthopedic implant companies that have been accused of violations to the federal anti-kickback laws are no longer the subject of the U.S. Attorneys offices federal oversight and have also been dismissed from criminal allegations that surgeons had received enormous sums of money as incentives to use their devices.

To avoid prosecution, the companies had agreed to accepting rigorous regulatory compliance procedures and a monitoring program by the federal government. Those agreements drew a great deal of criticism to U.S. Attorney Christopher Christie, when it was revealed that the former Attorney General, John Ashcroft, was appointed by Christie to a monitoring program contract estimated to be worth up to $52 million. Christie, the Republican gubernatorial nominee hopeful, faced some tough questions about his relationship to, and the appointment of federal monitoring program supervisor – former federal Judge Herbert J. Stern. Judge Stern and his law firm were responsible for contributions of more than $20,000 to Christies campaign fund.

When asked about the current relationship in light of the circumstances, Christie simply dismissed the matter as, “typical political stuff …”

After federal prosecutors discovered incidents where orthopedic surgeons had received consultation fees upwards of $200,000 a year for the promotion of products from orthopedic implant companies, the U.S. Attorneys office pursued formal criminal charges alleging the actions were a violation of federal anti-kickback laws that govern Medicare provisioned hospitals and healthcare professionals.

According to the federal prosecutors, the medical device companies were using the consulting agreements as a cover-up for payoffs to use specific implant products for artificial hip or knee replacement operations. Furthermore, the U.S. Attorneys office claim that these payments and fees are commonplace in the industry and may also be accompanied by luxurious gifts, and extravagant trips.

The investigators found evidence that the physicians had actually performed very little to no consulting work whatsoever and had received funds from the orthopedic companies solely for the use of their products, and failed to keep accurate reports disclosing their relationship with the medical device companies to the patients that received the surgery or the hospitals where the surgeries were performed.

Biomet Orthopedics Inc., Zimmer Inc., Smith & Nephew Inc., and DePuy Orthopeadics Inc., agreed to paying $311 million in a civil settlement agreement and accepted a deferred prosecution agreement which would expire should the companies agree to an extended monitoring program and implement stringent reforms.

The appointee to the monitoring of Zimmer Inc., was John Ashcroft. Zimmer Inc., was not willing to disclose the amount that was paid to Ashcrofts law firm. However, according to the firms spokesperson, the payments were around $6 to $9 million dollars a quarter.