Celltex Makes Bold Marketing Claims Despite Significant Manufacturing Problems Found During FDA Inspection

Last week, Celltex Therapeutics’ website changed from its longstanding status as a home page with no content to a functioning website containing many strong marketing claims about the stem cells Celltex distributes to clinics in Texas. The site now informs prospective customers that Celltex banks autologous mesenchymal stem cells obtained from abdominal fat tissue, makes numerous claims concerning the safety and efficacy of the processed and expanded stem cells it distributes to physicians, describes Celltex’s partnership with the South Korean company RNL Bio, and asserts that stem cells are provided in the context of clinical trials approved by an independent Institutional Review Board. Celltex also engaged in a minor marketing blitz by issuing a press release that was posted at multiple Internet sites.  While greater transparency about Celltex’s business operation is welcome, many of the assertions made by Celltex do not survive scrutiny. Observations by FDA investigators who inspected Celltex Therapeutics’ manufacturing facility, combined with additional sources of information, reveal significant problems with Celltex’s marketing claims.

Celltex Therapeutics, RNL Bio & promotional claims concerning “the leading edge of biosafety”  

According to a press release on Celltex’s website, “Celltex’s laboratory is currently operated by its licensing partner RNL Bio (dba Human Biostar) with lab technicians and scientists from RNL’s Seoul, Korea headquarters.”  Elsewhere, the site states,  “Celltex’s patented process of separating, multiplying and storing adipose (fat-tissue)-derived adult stem cells is based on the world-leading technology of RNL Bio. This is the leading edge of biosafety applied to regenerative medicine. Celltex has exclusively licensed this technology for its use in North America. We consider this technology to be the best adult mesenchymal stem cell banking technology in the world and are proud to be the only company to have this technology available in the United States.”

In asserting that RNL Bio’s process for expanding and banking mesenchymal stem cells is at the forefront of “biosafety,” Celltex fails to acknowledge the disturbing corporate practices of its licensing partner. At least two patients who received adult autologous stem cells processed by RNL Bio died following their stem cell procedures. One patient died after undergoing a stem cell procedure in China. The second patient died after receiving stem cells at a clinic in Japan. Given the limited publicly accessible information concerning these patients, there is no way to know whether or not the stem cells processed and distributed by RNL Bio played a causal role in these two deaths. However, the deaths reveal the importance of administering stem cells in carefully designed clinical studies and rigorously investigating all reports of morbidity and mortality occurring in the context of research involving human participants.

Additional reports state that some patients were harmed as a result of having stem cell infusions prepared by RNL Bio.  On one occasion, in an attempt to draw attention to their grievances, individuals claiming they were harmed as a result of receiving stem cells processed by RNL Bio disrupted a RNL Bio press conference.

Many clients of RNL Bio travel to Japan and China for stem cell procedures because RNL Bio is not authorized to distribute adult autologous stem cells to patients in South Korea. Despite not having approval from South Korea’s FDA to distribute and market stem cells for use in humans, news reports state that five clinics in South Korea administered to patients stem cells processed by RNL Bio. RNL Bio reportedly profited from sale of stem cells that were supposed to be provided free of charge to individuals participating in clinical trials. Finally, The Korea Times reports that RNL Bio has a history of “providing free stem cell treatments to politicians, bureaucrats and celebrities in return for lobbying for eased regulations on stem cell trials.” Given reports of RNL Bio’s business practices in South Korea and the company’s efforts to seek favor with powerful public figures, perhaps what is surprising is not that Texas Governor Rick Perry is one of Celltex’s clients but that, aside from Texas House Representative Rick Hardcastle, additional influential American politicians have not emerged both as clients of Celltex and RNL Bio and as outspoken supporters of “deregulation” of stem cell procedures.

Shifting from RNL Bio’s activity in South Korea to its business practices in the United States, RNL Life Science (now called Human Biostar), a subsidiary of RNL Bio, used a business location in Los Angeles to market stem cell procedures to elderly Korean-Americans and other customers. Most of the company’s clients had their stem cell procedures in Mexico or China. Six individuals who report that they paid for infusions or injections of stem cells processed by RNL Bio are now suing RNL Life Science, RNL Bio, Jeong Chan Ra (CEO of RNL Bio and also a Director of Celltex), and another company executive for intentional misrepresentation of fact, negligent misrepresentation of fact, false advertising, unfair competition, financial elder abuse, negligence, and breach of implied covenant of good faith and fair dealing.

Celltex’s website also fails to mention that RNL Bio reportedly has provided stem cells to at least 10,000 individuals without having obtained from South Korea, the United States, or any other country an approved biologics license application that would authorize the company to manufacture and distribute adult autologous stem cells. While South Korean regulations governing manufacture and administration of stem cell products are not identical to federal regulations in the United States, the countries have similar regulatory models. RNL Bio reports having submitted to the Korea FDA an Investigational New Drug application (Korea FDA IND number BPD-455, April 29, 2009) that enabled it to conduct a clinical study that involved administering mesenchymal stem cells to eight research participants with spinal cord injuries. However, I have not found any evidence indicating that RNL Bio has successfully brought a stem cell product to market by conducting Phase I, II, and III clinical trials, and obtaining regulatory approval after submitting a biologics license application.

Given RNL Bio’s history, there is reason to question both Celltex’s choice of technology licensing partner and Celltex’s claim that RNL Bio is on the “leading edge of biosafety.”

Celltex’s claims concerning the FDA inspection of its manufacturing facility

Two FDA investigators inspected Celltex’s manufacturing facility from April 16-27, 2012. According to a press release on Celltex’s website, “The FDA studied Celltex operations in depth in accordance with the ‘good tissue practices’ (GTP) standards, as it routinely does with inspections of facilities such as Celltex which are registered pursuant to 21 CFR Part 1271.” This claim is erroneous and there is considerable risk that it will mislead prospective customers. Celltex states that FDA investigators examined Celltex’s laboratory to see whether it is in compliance with “good tissue practices.” To the contrary, the inspectional observations form identifies Celltex as a “Biological Drug Manufacturer” and the FDA investigators provide a list of fourteen general observations (broken down into 79 specific points). These observations identify the many different ways in which manufacturing practices in Celltex’s facility fail to conform to current Good Manufacturing Practices. To comply with federal regulations, biological drug manufacturers must operate according to current Good Manufacturing Practices and have a biologics license application approved by the FDA.

Celltex engages in more than minimal manipulation of stem cells and therefore manufactures a biological drug product

Celltex claims that it must comply with “good tissue practices” rather than “contemporary Good Manufacturing Practices.” There are at least two problems with Celltex’s assertions concerning what regulatory standard it must meet.

First, Celltex’s processing and expansion of mesenchymal stem cells occurs over weeks and uses twelve supplies and reagents in addition to various pieces of laboratory equipment. According to Celltex’s website, “Cells must first be isolated and separated from the fat tissue. Celltex’s process uses fat tissue as its primary source because of the consistency of the cells in each sample…Our process involves the careful separation of just the Mesenchymal Stem Cells (MSCs) from a very small fat tissue sample – small enough to be minimally invasive for any donor. The newly separated MSCs undergo our Passaged Culture process that can multiply exponentially the separated cells into millions and millions of identical copies.” This extended laboratory-based process of culturing and expanding adipose-derived mesenchymal stem cells does not appear to fall within the scope of “minimal manipulation” of stem cells.

Second, Celltex facilitates non-homologous use of stem cells because Celltex distributes to clinics adipose-derived mesenchymal stem cells that are then infused or injected into patients with Parkinson’s disease, multiple sclerosis, and other illnesses.

If Celltex wishes to distribute processed and expanded mesenchymal stem cells in the context of clinical trials the company must first submit an Investigational New Drug (IND) application to the FDA and then wait 30 days to see whether the FDA puts a clinical hold on the application. To comply with federal regulations, after rigorously testing the investigational new drug for safety and efficacy in Phase I, II, and III trials, Celltex would then have to submit to the FDA a biologics license application and obtain regulatory approval before marketing processed and expanded stem cells as biological drugs.

Instead of complying with federal regulations Celltex claims that its extended laboratory process and use of at least a dozen laboratory supplies and reagents, incubators, fridges, and freezers involves nothing more than “minimal manipulation” of stem cells. From a business standpoint it is unsurprising that Celltex wishes to make this claim. Facilities that engage in minimal manipulation of autologous stem cells used in homologous manner do not have to conduct clinical trials, establish safety and efficacy, and have an approved biologics license application before profiting from sale of stem cells. However, focusing upon patient safety and compliance with federal regulations, it appears that Celltex is distributing stem cells without first establishing safety and efficacy of its products, complying with federal regulations, and ensuring that it is distributing a product that is worth the substantial fees it charges customers.

Celltex’s claim that it does not require a license to distribute processed and expanded stem cells  

According to a press release on Celltex’s website, “The FDA does not require a company to obtain FDA approval prior to distribution of its HCT/Ps. 21 CFR Part 1271. In addition, the FDA does not issue ‘licenses,’ so any reference that Celltex provides ‘unlicensed’ procedures is inaccurate. Celltex’s process for reproducing adult mesenchymal stem cells is legal, and there is no requirement that the cells be approved or licensed.” While it is true that an approved biologics license application is not required when administering minimally manipulated, autologous, homologous stem cells to patients, the FDA inspection report classifies Celltex as a biological drug manufacturer. Companies that wish to introduce a biologic drug into interstate commerce must first have an approved Biologics License Application (BLA). Though Celltex states that at present it is releasing manufactured stem cells only to physicians in Texas, the processed and expanded stem cells (biological drugs) distributed by Celltex’s manufacturing facility are considered introduced into interstate commerce if their production involves use of supplies, reagents, and laboratory equipment that reached Celltex’s facility through interstate commerce. Celltex’s website is misleading; to manufacture a biological drug Celltex must have an approved biologics license application.

Celltex’s marketing claims concerning quality assurance and safety of processed stem cells

Celltex’s website makes many strong claims concerning quality assurance and safety of processed stem cells. For example, the website states:

•“Celltex has a quality assurance and control process that is unsurpassed. We use the best technologies to ensure that cells are being processed properly and that the released cells meet all of our quality standards.”

•“No other corporation or academic organization engaged in the banking of mesenchymal adult stem cells does as much quality control or operates in as secure an environment as that deployed by Celltex.”

•“Significant tests are conducted and practiced rigorously to ensure a completely safe stem cell product.”

•“No method of providing adult stem cells has received more rigorous clinical safety study than the technology used by Celltex.”

•“Our technology exemplifies safety and security.”

These promotional statements are not supported by the inspectional observations form completed by FDA investigators. Nine pages long, the document identifies significant problems with Celltex’s manufacturing process. The report identifies many shortcomings with Celltex’s quality assurance program and prompts serious questions concerning the safety of the stem cells Celltex distributes to local clinics.  Many of the observations made by the FDA investigators contradict marketing claims Celltex makes about the quality of its laboratory practices.  Examining specific promotional statements and comparing them to inspectional observations documented by the FDA investigators reveals major flaws with how Celltex is marketing itself to prospective clients.

Viability of stem cells and type of stem cells distributed to clinics

Celltex’s claims

Celltex claims that it distributes viable mesenchymal stem cells to local clinics. Celltex’s website states, “We ensure that the cells we deliver are, in fact, mesenchymal stem cells. There are markers on a cell’s surface that determine whether it is a stem cell. Cell differentiation is tested in vitro to positively identify mesenchymal stem cells.” Celltex also claims that the stem cells it distributes are viable. According to a press release on Celltex’s website, “Celltex ensures that all of the cells it provides to physicians for therapeutic use are sterile, viable, intact mesenchymal stem cells. RNL’s quality control scientists examine each patient’s cells for their integrity and sterility prior to release, documenting those findings. Celltex and its partner RNL Bio process stem cells in a safe, sterile laboratory with procedures that ensure cell viability and integrity.”

FDA Inspection

The FDA investigators observed that Celltex’s personnel “have not performed a validation of” the facility’s “banking and thawing process to assure viability of MSC’s,” have “not performed a process validation for manufacturing MSC’s to assure batch uniformity and integrity as related to each of the following finished product characteristics: viability of cells, the specified cell count, cell type, and appearance of cells,” and “have not verified the final product…to assure the identity of the cell type in the final MSC’s.” These observations indicate that Celltex is releasing stem cells for use in patients without assuring that the company distributes viable mesenchymal stem cells. The FDA inspection report prompts questions about Celltex’s marketing claims concerning the type of cells Celltex releases and the viability of these cells when they are injected or infused into patients.

Testing stem cells

Celltex’s claims

Celltex makes numerous claims about the steps it takes to test stem cells and ensure that they are safe for distribution. Celltex’s website states, “In order to ensure safety of banked cells, there should be no presence of parasites and toxins.  Celltex conducts mycoplasma and endotoxin tests multiple times throughout the banking and cell culture process.  Cells that are released from our facility our (sic) tested and checked to be contaminant free.” Celltex’s website also states, “Sterility testing is necessary to show that the cells are free from any bacteria or fungi.  Virus testing is also conducted during the banking process.”

FDA Inspection

The FDA inspection identified many ways in which Celltex’s manufacturing process failed to conform to current Good Manufacturing Practices and lacked proper quality assurance controls. During their inspection FDA investigators found that Celltex has “no requirement for pressure differential between the clean rooms and the exterior rooms to assure non-controlled air does not flow in the cleanrooms.” The FDA investigators observed, “procedures designed to prevent microbiological contamination of drug products purporting to be sterile are not established, written, and followed.” They also observed that Celltex “failed to validate” its “aseptic (mesenchymal stem cells) MSC’s manufacturing process in order to prevent microbiological contamination.” The investigators documented that particular mesenchymal stem cells processed at Celltex failed sterility tests. They also observed that Celltex had not validated its “aseptic gowning process in order to prevent microbiological contamination.” The investigators note that Celltex does not “document checks of incubators for contamination.”

The inspection report states that environmental test results from the clean room, gowning area, and biosafety cabinets “show the isolation of microorganisms as the result of the use of settling plates. Some of the microbiological counts documented are beyond the established specifications. There is no data to show that the microorganisms isolated have been identified or investigated.”

The FDA investigators observed that Celltex does not document whatever quality assurance steps it takes when investigating failures of batches of processed and expanded mesenchymal stem cells. The inspection report notes, “Written records are not made of investigations into the failure of a batch or any of its components to meet specifications.” The inspection report states that some mesenchymal stem cells at Celltex’s manufacturing facility “failed initial and repeat testing for sterility.” Although the FDA investigators found examples of mesenchymal stem cells that failed sterility testing, Celltex employees were unable to provide to the FDA investigators “destruction records” for mesenchymal stem cells “that failed sterility testing.” FDA investigators also documented mesenchymal stem cell units that “failed initial endotoxin testing.”

Environmental tests identified additional problems. The investigators found that “Bacteria and Fungi test results” were “exceeded for the BSC (Biosafety Cabinet-CleanRoom, Gowning Area, CleanRoom, CleanRoom, and BSC (BioSafety Cabinet-Clean Room, BSC-M (Biosafety Cabinet-Manufacturing), BSC-Q (Biosafety Cabinet –Quality Control, CleanRoom.” The investigators also found that Celltex was unable to provide documentation of checks of “culture expansion flasks of MSC’s for evidence of contamination.”

Of particular concern, the FDA investigators found problems with the supplies and reagents used in the manufacture of mesenchymal stem cells.  One laboratory supply “used to prevent bacterial and fungi growth in culture media” had a Certificate of Analysis that stated: “FOR RESEARCH USE ONLY. CAUTION: Not Intended for human or animal diagnostic or therapeutic uses.” A laboratory supply used to “rinse” mesenchymal stem cells had a Certificate of Analysis that stated: “CAUTION: Not for human or animal therapeutic use. Uses other than the labeled intended use may be a violation of local law.” A third laboratory supply used to harvest mesenchymal stem cells had a Certificate of Analysis stating, “FOR RESEARCH USE ONLY. CAUTION: Not intended for human or animal diagnostic or therapeutic uses.”

Observations recorded by the FDA investigators document in great detail problems with Celltex’s manufacturing process, failures to check for contamination, and failure to document destruction of stem cells that did not meet quality assurance standards. The investigators found examples of mesenchymal stem cells that failed sterility testing, exceeded test results for bacteria and fungi, and failed tests for endotoxins. Despite Celltex’s marketing claims about safety of the mesenchymal stem cells it releases to clinics and the rigor of its quality assurance program, it appears that Celltex’s manufacturing process deviates in many noteworthy ways from current Good Manufacturing Practices and includes use of supplies that are not intended for use in humans. Celltex’s website does not address what steps the company has taken to address all of the inspectional observations.

Celltex makes strong claims about the safety and efficacy of the stem cells it distributes and the exacting standards of its quality assurance process. The FDA 483 form prompts questions about the credibility of these marketing claims. Observations made by FDA investigators suggest that many of Celltex’s promotional claims are not supported by evidence.

Stem cell banking

Celltex’s claims

With regard to banking of stem cells, Celltex claims, “After the cells have been separated and cultured, it is imperative that cells can be safely preserved for future use. Celltex’s patented and proprietary banking technology ensures the best conditions for short and long-term storage of stem cells so that they can be used in the future.”

FDA inspection

The FDA investigators noted that Celltex had failed to validate its banking and thawing process for the purpose of assuring that it distributes viable mesenchymal stem cells. The investigators also found that Celltex failed to document the temperature of the laboratory equipment used to thaw banked stem cells even though the equipment is supposed to be set at a specific temperature during the thawing process.

Stem Cell Dosing

Celltex’s claims

Celltex asserts that it distributes precise doses of stem cells to clinics. The company’s website states, “When a physician places an order with us, it is our job to make sure that the prescribed dosage is delivered.  The Celltex process involves both manual and machine cell counting to verify the number of cells cultured.”

FDA Inspection

Contrary to Celltex’s marketing claims, FDA investigators found problems with stem cell doses distributed by Celltex’s manufacturing facility. The FDA inspection report indicates that Celltex has not conducted a manufacturing process validation designed to assure specific cell counts, distributes stem cells to clinics without proper labeling to indicate the number of mesenchymal stem cells in each syringe, and maintains distribution records that fail to document number of mesenchymal stem cells per transported syringe. These problems prompt questions concerning Celltex’s capacity to ensure that it distributes to clinics precise doses of mesenchymal stem cells.

Stem cells are distributed for use only in individuals who are enrolled in clinical trials approved by an Independent Institutional Review Board

Celltex’s claims

Celltex claims that the stem cells it provides for use in patients are safe and effective treatments. However, the company also claims that it will release stem cells only to individuals who are enrolled in clinical studies. These studies reportedly are designed to “to better understand the therapeutic impact and monitor the safety of adult stem cell therapy.”  Celltex states that clinical trial protocols are reviewed and approved by “an independent Institutional Review Board.”

Problems with Celltex’s claims concerning administration of stem cells in the context of clinical studies

Celltex’s website provides no information concerning clinical trial endpoints, study inclusion and exclusion criteria, or other details concerning study protocol design. Celltex’s website does not indicate whether the studies are designed to test toxicity, efficacy, or compare the stem cells it distributes against either placebo or existing standard of care for such illnesses as multiple sclerosis and Parkinson’s disease. Celltex mentions that the company is “Now enrolling for patients for multiple chronic and life-threatening diseases,” but it does not describe particular studies or identify what steps the company takes to protect research participants from harm. Celltex also does not explain why it is administering stem cells only in clinical studies if its stem cells are already known to be safe and efficacious. Celltex does not address why individuals are charged between $20,000 to $30,000 for stem cell banking and distribution when stem cells are being administered in the context of clinical research. Finally, Celltex provides no indication that it has submitted to the FDA an Investigational New Drug application prior to distributing processed and expanded mesenchymal stem cells to clinical trial participants.

Celltex’s website does not identify the clinician-investigators participating in Celltex’s “clinical trials network.” Whatever studies Celltex is conducting or sponsoring are not listed in the ClinicalTrials.gov database. While Celltex’s website does not identify the Institutional Review Board that reviews whatever studies the company is conducting, elsewhere Celltex states, “prospective clinical studies involving Celltex stem cells are being coordinated with the independent Institutional Review Board (IRB) and clinical research organization (CRO) of Texas Applied Biomedical Services (‘TABS’).” TABS’s website provides no information concerning approval of studies submitted by Celltex. In addition, TABS provides the name of a contact, Joyce Heinrich, but offers no details concerning identities and qualifications of members of the institutional review board.

In short, there are many unanswered questions concerning Celltex’s clinical studies. Of greatest concern, it appears that Celltex is manufacturing and distributing a biological drug product without first submitting to the FDA an Investigational New Drug application. Approval by an Institutional Review Board and consent of individual stem cell participants is insufficient when an unapproved biological drug product is administered to research subjects.


Celltex makes many bold marketing claims about the safety and efficacy of the mesenchymal stem cells it processes, expands, banks, and distributes for use in treatment of individuals with Parkinson’s disease, multiple sclerosis, and other illnesses. The inspection of Celltex’s biological drug manufacturing facility by FDA investigators prompts questions concerning the credibility of many of these promotional claims. It appears that Celltex is manufacturing, marketing, and distributing for use in patients an unapproved biological drug. Celltex has now engaged in this conduct for over one year. The development of Celltex’s website combined with the strong claims the company makes concerning the mesenchymal stem cells it releases to clinics suggests that Celltex intends to continue violating federal regulations governing manufacture and distribution of biological drug products. Unclear at present is how the FDA intends to respond to Celltex’s manufacturing practices, questionable marketing claims, and distribution of processed and expanded mesenchymal stem cells.

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