The Federal Trade Commission has obtained a court order temporarily halting the marketing operations of the American Urological Corporation, and several related companies, all under the direction of David A. Brady, for allegedly false claims about the effectiveness of its impotence treatment products. The FTC alleged that Brady and his companies marketed and sold a host of products as purported treatments for impotence by falsely creating the impression that the products have been developed by legitimate medical enterprises and that clinical studies have proven that the products effectively eliminate impotence in 68 to 94 percent of men. In one instance, the FTC said, Brady sold a product called, “Väegra®,” the name of which closely resembles the recently approved drug, Viagra, used for treating impotence. In fact, other than the names, there is no similarity between the two products. The U.S. District Court in Atlanta, Georgia, has frozen the assets of Brady and his companies, and the FTC is seeking a permanent injunction prohibiting future misrepresentations and providing redress for consumers.
“These defendants have illegally cashed-in on the publicity and popularity surrounding a new medical product and exploited consumers desperate for a cure,” said Jodie Bernstein, Director of the FTC’s Bureau of Consumer Protection. “Taking advantage of consumers seeking treatment for a very personal, potentially serious medical condition is just plain wrong. The Commission is committed to stopping it and will continue to prohibit any marketer's attempt to deceive consumers by lying about their product.”
The FTC's complaint detailing the charges alleges that the defendants used direct mail solicitations, Internet web sites and fictitious company names to market a number of unapproved oral treatments for impotence under the product names “Alprostaglandin®,” “The Celldenaphil-pc System,” “Renak-pc.” “Oral Phentalomil®,” “Prosta-Gen©,” “Testosterone-21,” “Väegra®,” “Urophil,” and “VasoGenitine." While many of these products carried names that sounded like approved prescription medications, according to the FTC, defendants' products, which range in price from $39.45 and $98.95, differ significantly from the prescription drugs.
The complaint states the products were offered for sale by purported medical organizations:
American Urological Corporation -- a Texas corporation with an address in Dallas. It transacts business and markets products for the treatment of impotence from an office in Doraville, Georgia. The Institute of Sexual Research, Inc. with an address in Grand Prairie, Texas, markets products for the treatment of impotence under its own name and under the assumed names American Urological Clinic, Carnegie Research Institute, and New England Institute for Impotence and Prostate Care. The Clinic for Natural Solutions, Inc. also with an address in Grand Prairie, markets products for the treatment of impotence under its own name and under the assumed names United States Academy of Urological Sciences and National Institute for Urological Health.
Old Well Corporation("Old Well Texas”) with an address in Grand Prairie, and both The Institute of Sexual Research (ISR), Ltd., and Old Well Corporation ("Old Well North Carolina”), with addresses in Zebulon, North Carolina, market products for the treatment of impotence.
The FTC alleges that the addresses these companies provide in their promotional materials are all mail drop addresses and that the defendants have no facilities at these locations. In fact, according to the complaint, all mail and telephone calls to these locations are forwarded to a warehouse in Doraville, Georgia, where the defendants conduct their operations. In addition, the agency charges that Brady holds numerous titles as the president, director, or officer of all the companies and operates them all as a common enterprise using fictitious names.
The complaint further charges that the defendants falsely claimed that their products are effective in eliminating impotence in 68 to 94 percent of men, and that scientific evidence has proven their impotence treatment products, and/or the ingredients contained in them, to be effective in eliminating impotence for 68 percent or more of impotent men.
The FTC’s complaint charges that:
The Commission vote to file the complaint was 4-0.
The FTC filed its complaint, under seal, in U. S. District Court, Northern District of Georgia, Atlanta Division, on August 3, 1998. The seal was lifted August 6, 1998.
The Missouri Attorney’s General office and the U.S. Food and Drug Administration provided substantial assistance to the FTC in this investigation.
NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. The case will be decided by the court.
Copies of the complaint are available from the FTC’s web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-FTC-HELP (202-382-4357); TDD for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.