Center for Legal Policy Report Takes Aim at FDA’s Regulation of Autologous Stem Cell Procedures

September 29, 2013

By William T. Koustas – 

We have previously reported (here and here for example) on the litigation between Regenerative Sciences, LLC (“Regenerative”) and FDA.  Regenerative is a Colorado company that owns a medical procedure known as the Regenexx Procedure.  It is a non-surgical procedure by which physicians take bone marrow and blood samples from a patient, culture and process the stem cells, and inject them back into the same patient in order to treat joint, muscle, tendon, or bone pain.  The Regenexx Procedure is exclusively licensed for use by the Colorado clinic where its inventors practice. 

As reviewed in more detail in our prior posts, FDA contends that, among other things, the stem cells processed in the Regenexx Procedure are a drug under the Federal Food, Drug, and Cosmetic Act (“FDCA”) and must therefore only be created pursuant to a New Drug Application and under current Good Manufacturing Practices.  Regenerative responds that the Regenexx Procedure is the practice of medicine, which is outside of FDA’s jurisdiction and the stem cells are not introduced or delivered for introduction into interstate commerce since the entire process is performed in Colorado. 

The U.S. District Court of the District of Columbia ultimately sided with FDA, although it called the decision a “close question.”  The Court found that the stem cells used in the Regenexx Procedure are a drug as defined under the FDCA and that FDA has jurisdiction to regulate this procedure “because a component of the [Regenexx Procedure] shipped through interstate commerce prior to its administration to the patient,” thus satisfying the interstate commerce requirement in the FDCA.

However, with the case now pending before the U.S. Court of Appeals for the District of Columbia Circuit, a new report authored by Richard A. Epstein from the Manhattan Institute’s Center for Legal Policy (“the Report”) calls into question the legal and policy bases for FDA’s regulation of autologous stem cell procedures like the Regenexx Procedure.

The Report, titled “The FDA’s Misguided Regulation of Stem-Cell Procedures: How Administrative Overreach Blocks Medical Innovation,” contends that FDA “has taken the aggressive position that it has oversight authority over any stem-cell procedure that reinjects harvested stem cells into the same person from whom they were removed, so long as those cells were grown and cultured outside the human body.”  Among other things, the Report argues that FDA and the district court incorrectly interpret the interstate commerce provision in the FDCA while also improperly determining that the stem cells in the Regenexx Procedure are drugs rather than part of the practice of medicine. 

With respect to FDA’s position that is has authority to regulate autologous stem cell procedures pursuant to the interstate commerce provision in FDCA § 301(a), the Report contends that the statutory authority provided in the FDCA does not extend as far as the Constitution’s Commerce Clause.  The Report points to the fact that the interstate commerce language in the FDCA pre-dates the Supreme Court’s Wickard v. Filburn, 317 U.S. 111 (1942), decision and is therefore meant to reflect a pre-Wickard reading of interstate commerce.  As such, “the statutory requirement…is not whether a reagent used in the process has moved in interstate commerce but whether the dangerous (‘adulterated or misbranded’) article itself has moved in interstate commerce.”  Therefore, while the Constitution’s Commerce Clause would allow Congress to regulate autologous stem cells due to use of reagents that traveled through interstate commerce, the FDCA’s interstate commerce provision would not. 

In addition, the Report suggests that the “held for sale” language of FDCA § 301(k) only applies to articles that were themselves part of an interstate commerce transaction.  However, the stem cells used in the Regenexx Procedure were never part of an interstate transaction themselves and were therefore not held for sale in an interstate transaction.

The Report also makes the case that the Regenexx Procedure is the practice of medicine rather than the manufacture of a drug as FDA contends.  The Report analogizes the Regenexx Procedure to dental work by noting that, “[t]he process in question would normally be regarded as a provision of services for which the growth of the cells under these highly specified procedures would be regarded as, at most, an ‘incidental’ element to the transaction, just as a dentist who prepares mixtures for fillings is regarded as having supplied services and not as having manufactured and sold a mixture of silver and bonding solutions.”  The report also notes the basic differences between cultivating autologous stem cells and the mass production of drugs, arguing that the “…uniqueness [of the cultivating of stem cells] makes it relatively easy…to engage in the upstream regulation of these products” by state medical boards instead of FDA-approval.  In contrast, the Regenexx Procedure does not lend itself to FDA regulation as the process is slightly different for every patient.

The Report also seeks to rebut FDA’s argument that it is entitled to extensive deference in its interpretation of the definition of “drug.”  It points to the Supreme Court’s decision in FDA v. Brown & Williamson Tobacco Corp., 529 U.S. 120 (2000), in which “the Court pushed back on the FDA when it sought to include cigarettes and tobacco as drugs under the [FDCA]…”  The Report goes on to state that, “…even if it takes great skill to figure out how to regulate drugs, and the government’s broad claims for Chevron deference here should not override the ordinary meaning of ‘drugs’ versus ‘medicine.’”  

Given the arguments laid out in the Report, it will be interesting to see how the case is resolved in the Court of Appeals.