The Federal Trade Commission and the Georgia Attorney General’s Office today sued the co-founders of the Stem Cell Institute of America for marketing stem cell therapy to seniors nationwide using bogus claims that it is effective in treating arthritis, joint pain, and a range of other orthopedic ailments.
The agencies’ complaint also alleges that the Canton, Georgia-based defendants promoted the false or unsubstantiated claim that stem cell therapy is comparable or superior to surgery, steroid injections, and painkillers, and that they provided chiropractors and other healthcare practitioners with the means of deceiving consumers about such treatments.
“These defendants advertised expensive stem cell injections with baseless pain-relief claims, and provided marketing materials and training to chiropractors to do the same,” said Samuel Levine, Acting Director of the Bureau of Consumer Protection. “With our partner, the Georgia Attorney General, we aim to ensure they can’t keep preying on older adults and others who need real medical help.”
“At best, the use of unproven products or therapies can cost consumers thousands of dollars without affording them any results,” said Georgia Attorney General Chris Carr. “At worst, it can be harmful to their health. Our office will continue to hold accountable businesses that make unsubstantiated claims and violate the law – especially those that target our older or at-risk adults.”
The joint agency complaint, names as defendants Steven D. Peyroux and Brent J. Detelich, Regenerative Medicine Institute of America, LLC, doing business as Stem Cell Institute of America, LLC (SCIA); Physicians Business Solutions, LLC (PBS); and Superior Healthcare, LLC (SHC).
Peyroux, a chiropractor, owned and managed SHC, a clinic that provided patients with a range of healthcare-related services, including, between 2015 and mid-2019, stem cell therapy. While running SHC, Peyroux founded PBS, a consulting firm that advises and trains chiropractors and other healthcare practitioners on how to expand their businesses. Detelich, a former chiropractor and longtime business associate of Peyroux’s, started working with PBS as a coach and speaker, and has managed some of the company’s business operations.
In 2015, Peyroux and Detelich co-founded SCIA, a company that trained chiropractors and other healthcare practitioners on how to add stem cell therapy to their practices. The complaint states SCIA trained its client clinics on how to recruit patients through advertising, host free educational seminars, and conduct consultations. SCIA also provided its clients access to a “vault” of sample advertisements, including newspaper ads, fact sheets, and PowerPoint slides and provided client clinics with the appearance of being part of a large nationwide network under the SCIA name and logo.
The agencies contend the defendants also hosted their own free “educational seminars” for consumers, where they marketed SHC as an SCIA clinic and pitched stem cell therapy as an effective treatment for joint pain and other orthopedic conditions. They allegedly targeted seniors and retirement communities, and at the end of the seminars would attempt to schedule attendees for consultations at SHC’s clinic. SHC charged approximately $5,000 per joint injection, with many patients receiving more than one injection as part of their treatment.
In 2018, the complaint alleges, the defendants began offering a stem cell therapy program through PBS similar to SCIA’s services. PBS trains its clients on setting up and marketing a regenerative medicine program through seminars, conferences, one-on-one consultations, and access to “PBS University,” an online platform with training videos. PBS has also provided demonstrations at the SHC clinic on how to administer stem cell injections.
In addition to making false and unsubstantiated claims, the complaint alleges that the defendants violated Georgia’s Fair Business Practices Act related to the distribution of false or misleading information through the use of a computer or computer network.
The Commission vote authorizing the staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the Northern District of Georgia. The FTC appreciates the partnership of the Georgia Attorney General’s Office in bringing the action announced today.
NOTE: The Commission files a complaint when it has “reason to believe” that the named defendants are violating or are about to violate the law and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the court.
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