Stem cells are regulated today as Human Cells, Tissues, and Cellular and Tissue-based Products (HCT/Ps). §§ 21 CFR 1271 et seq, 42 USC 462 et seq, 42 USC 274 et seq. Regulation as drugs under §§ 21 USC 321, 355 require a nexus to interstate commerce that the FDA has interpreted as not being required based on a 1977 case involving contaminated turtles. Louisiana v. Mathews, 427 F. Supp. 174, 176 (E.D. La. 1977). While there is a "presumed" nexus to interstate commerce under the FDCA statutes, presumptions can and should be overcome.

The potential exemption of physicians who would provide stem cell transplants without the introduction of the cells into interstate commerce should be protected under 42 USC 360(g) and 21 USC 396 that state that the practice of medicine has never been intended by congress to be regulated by the FDA, but by the individual and several States. The FDA has recognized that it is not authorized by congress to interfere with medical practice. 37 Fed. Reg. 16503 (1972); 40 Fed. Reg. 15393-94 (1975)(regarding off-label use of new drugs); 44 Fed. Reg. 37435-36 (1979)(Good medical practice and patient welfare require that physicians remain free to use drugs according to their best knowledge and judgment; 48 Fed. Reg. 2673 (June 9, 1983).

During Notice and Comment for the addition of stem cells into the regulations for HCT/Ps, questions were raised as to the regulation of the practice of medicine and questionable constitutionality. These are set forth in the Federal Register Notice of 2001 concerning the final rule-making on biologics that was to go into effect in a tiered approach beginning from 75 days, two years, and four years from the rule. 66 FR 5447. Careful review of this Federal Register Notice reveals that it was an attempt to regulate neural stem cells specifically regardless of the nexus to interstate commerce required by §§ 21 USC 321, 355 and over the objections of several comments that the proposed regulations would regulate the practice of medicine. The FDA is known to legal commentators in other cases to have tread illegally on the States' sole power to regulate the practice of medicine. Folkes, S., Kessler's Legacy to the FDA, 5(5) Smart Drug News (1998).1

Comment 10) We received several comments on our proposed regulation of hematopoietic stem cells. One comment supported the proposal that all establishments involved with hematopoietic stem cell therapy register with FDA. Two comments asserted that the proposed regulation would jeopardize patient treatment, impede the development of new therapies, and increase the costs of treatment. One comment asserted that we lack the legal authority to regulate intrastate hematopoietic stem cell transplants. Another comment argued that clinical research involving the use of blood or bone marrow transplantation for treatment of human diseases, but not involving an investigational drug or device, should not require an investigational new drug application or investigational device exemption. This comment further requested the development of simplified procedures for evaluating those investigational devices or cellular biologic products that are more than minimally manipulated. Two comments argued that there is no need for FDA regulation as industry standards suffice and FDA requirements would be duplicative.

We believe that it is necessary to bring the regulation of hematopoietic stem cells in line with the regulation of other HCT/P's, and that we possess the legal authority to take this action. Like other HCT/P's, hematopoietic stem cells may transmit communicable diseases; thus, the basic communicable disease prevention requirements that will be contained in part 1271, including these registration and listing requirements, are as relevant to these cells as to any other HCT/P's. Intrastate activities involving hematopoietic stem cells, as well as other HCT/P's, can be regulated to prevent the interstate spread of communicable diseases under section 361 of the PHS Act. (See Louisiana v. Mathews, 427 F. Supp. 174, 176 (E.D. La. 1977).) The GAO has cited the lack of regulation of hematopoietic stem cells as a significant gap in our oversight, and urged us to proceed with implementing new regulations that would cover hematopoietic stem cells. We are now closing that gap.

66 FR 5452 [emphasis added]. The FDA disagreed that the expansion of mesenchymal cells in culture or the use of growth factors to expand umbilical cord blood stem cells are minimal manipulation. 66 FR 5457, January 20, 2001. [emphasis added]; 66 FR 5459-60 (neuronal tissue raises clinical safety and effectiveness); 66 FR 5456 (sporadic, isolated "distribution" between health care facilities does not make one a distributor required to comply with the regulations).

However, there is no published Federal case today in which these onerous regulations were subjected to challenge. The only case even mentioning 21 CFR 1271 et seq is a whistleblower case in which an employee informed the FDA of possible violations of the statute. Kozloski, et al, v. American Tissue Services Foundation 2007 U.S. Dist. LEXIS 72303 (USDC Minn 2007).

The regulations require only that a facility register with the FDA under the Public Health Service Act, Sec. 361 if all of a long list of criteria are met.2 PHS 361 is codified as 42 USCS § 264 and relates to the control of communicable diseases, the legitimate government function that the Food and Drug Administration utilized to gain control of this promising research, and save the big profits for the big drug companies. A facilities are also exempt is "an establishment that does not recover, screen, test, process, label, package, or distribute, but only receives or stores HCT/P's solely for implantation, transplantation, infusion, or transfer within your facility." 21 CFR 1271.15(d). These facially less restrictive regulations also contain detailed requirements for labeling, 21 CFR 1271.370, and a distinct identifier code, 21 CFR 1271.290(c).

If the criteria set for in 21 CFR 1271.10 or 1271.15(d) are not met, the HCT/P products are regulated effectively as "new biologics," which subjects to the same Investigational New Drug and New Drug Approval process as new drugs. The costs of these studies is nearly a billion dollars, preventing any small or even medium sized company from entering this market.

These statements, however, are not part of the finally enacted Rule, 21 CFR 1271 et seq and are the sort of expansion of legislative authority by interpretive regulations by an agency that do not require Chevron deference by the US District Court. California Dental Association, Petitioner V. Federal Trade Commission, 526 U.S. 756, 765 (1999). Moreover, an agency cannot expand the interpretation of its jurisdiction that was legislated by congress. In this case, a presumption of interstate congress has been enacted, 21 USC 379a, but that presumption can be overcome where lack of interstate commerce is apparent and there is no finding by congress that plainly intrastate transactions are to be regulated as the FDA claims in 66 FR 5447.

A regulation, promulgated by an agency, cannot control the interpretation of a statute. Although we may give deference to an agency's construction of a statute, it is the court, and not the agency, that has ultimate responsibility to construe Congress's language

These regulations appear to be open to challenge by a licensed physician who had a patient in need of stem cell treatment and a source within the same state. He would be exempt from requirement of FDA approval on his practice of medicine, 21 USC 360(g) and that the applications of that the presumption of interstate commerce was overcome under these facts. The FDA claimed that did not intend to regulate the practice of medicine when it added stem cells to the list of biologics in 2001, 66 FR 1542, January 20, 2001; 21 CFR 1271.3 (2002) did not include stem cells in the listing of biologics; 21 CFR 1271.3 (2004) included stem cells but mandates only licensing of the manufacturing facility and its products, but 21 CFR 1271.440 (November 2005) allows the FDA to take possession of and/or destroy the a HCT/P that is produced or marketed in violation of the rules.

As an analogy, in 2005, congress enacted 42 USCS § 274l that created a therapeutic outcomes database. The Secretary would not need to establish and maintain a scientific database if stem cell transplanting physicians were to submit IND's on their work. There was never, and is still no requirement that the organizer of the shipment of a human fetus, a vascularized human organ, to a licensed facility for the harvesting and transplantation of stem cells is required to obtain IND approval from the FDA.

The FDA does not have the legislative authority to regulate even a new drug unless it is introduced into commerce. §§ 21 USC 331 (a); 21 USC 355 (a). No approval of a new drug application, for which an IND is a preliminary, is required unless a "drug" is to be introduced into interstate commerce. Id. Even where a miscarried fetus were to move in interstate commerce, it is more akin to a vascularized organ for transplantation and no more regulated by the FDA than a human liver or kidney. Were fetal sources of stem cells, or the cells themselves, regulated as organs, it would be illegal to sell them.

(a) Prohibition. It shall be unlawful for any person to knowingly acquire,
receive, or otherwise transfer any human organ for valuable consideration for
use in human transplantation if the transfer affects interstate commerce. The
preceding sentence does not apply with respect to human organ paired donation.

(b) Penalties. Any person who violates subsection (a) shall be fined not more
than $ 50,000 or imprisoned not more than five years, or both.

42 USCS 274e. Prohibition of organ purchases

The prohibition on sales, should stem cells or their sources be regulated as organs would eliminate a potential windfall to biotechnology and pharmaceutical companies and could drive the price of these treatments beyond what the typical American can afford. The organ data-base program is functioning effectively in spite of the difficult statistical chance of obtaining a "match" for a child in need, for instance, of a kidney.

In the case of neural stem cells, no match is required. It appears to be preferable that the cells be donated as are organs, and that the corporations and physicians who perform the transplants earn their income by charging for the time and skill in effectuating that, not for the cells themselves.

Footnote 1: If antineoplastons do work, then what is the "real" issue? The FDA does not approve of the fact that Dr. Burzynski is practicing medicine with antineoplastons. In other words, how dare Burzynski treat patients with antineoplastons before the FDA has given him permission to do so?! But what is the FDA to do? There are 200 years of Supreme Court precedent establishing that the individual states have the sole power to regulate the practice of medicine. The FDA regulates only through interstate-commerce provisions of the Constitution (see sidebar), and since interstate commerce is not involved in the practice of medicine, the FDA has no jurisdiction.

Footnote 2: 221 CFR 1271.10
1271.10 Are my HCT/P's regulated solely under section 361 of the PHS Act and
the regulations in this part, and if so what must I do?
(a) An HCT/P is regulated solely under section 361 of the PHS Act and the
regulations in this part if it meets all of the following criteria:
(1) The HCT/P is minimally manipulated;
(2) The HCT/P is intended for homologous use only, as reflected by the labeling, advertising, or other indications of the manufacturer's objective intent;
(3) The manufacture of the HCT/P does not involve the combination of the cells or tissues with another article, except for water, crystalloids, or a sterilizing, preserving, or storage

It might be tempting to hire the man or woman you are dating in times like these. Perhaps the gal answering the phone or the fellow making deliveries is just not working out, and the person you love just lost his or her job. You may be thinking, "Why not keep it in the family?"

Here is why not. If your relationship fails, it may not be legal to end the employment. This sounds horrific, that a "Mom and Pop" operation might be forced to keep going after Mom and Pop are no longer together, but in some states the one forced to leave the small operation could have a cause of action against its owner.

You would be better off in family court. Even in the often female biased family court, the rights of the breadwinner (in Family Law vernacular, "Payor Spouse") are better protected than those of the employer at the Equal Employment Opportunity Commission.

So why the comparison? I make this comparison because, when, as it often does, love crosses socio-economic boundaries, the high income mate may be less reluctant to hire his or her sweetheart than to get married. This is not an objection to the crossing of socio-economic boundaries in affairs to the heart, but quite the contrary. A person finding himself or herself single in middle age is better advised to be "picky" as to sense of humor, chemistry, mutual interests, etc., instead of income. Just do not extend that to a job offer.

Under the laws of this country, you are better off getting married than giving your honey a job. Family Court, even in a rigid no-fault community property state like Nevada, takes into account such factors as the length of a marriage, how much the marital estate increased during that time and whether that increase was the result of active or passive efforts. Spousal support is not even considered for a union of less than five years, and when awarded is generally about half of the difference between incomes for half the length of the marriage. Yes, it is a big chunk of change but a manageable chunk, and a predictable chunk.

Under 42 USC 2000e et seq, the Civil Rights Act of 1964, commonly known as Title VII, it is unlawful to terminate a person's employment because a personal relationship has come to an end. It is considered sexual harassment, even if the relationship was consensual and even if it was the only reason the job was offered to begin with. This is why many companies have policies that will terminate a manager or supervisor for "fraternizing" with a lower level employee.

The amount of damages are endless, as he or she is entitled to the current salary up until the time of the judgment, and reinstatement. The emotional angst of having to work besides a person you had been intimate with, consensuality of no consequence, does not exempt your company from its duty not to make employment decisions on this basis. To legally terminate the employment of a person who can make a presumptive showing of a discriminatory reason, such as no longer dating the companies owner, the company must show a "non-pretextual" reason. In most circuits, even evidence discovered after the discharge, such as falsification of a resume, is not adequate grounds if the real reason for the discharge was illegal. The employee can also get attorneys' fees. The employee may not even need to interest a plaintiffs' attorney in taking the case on contingency, but can file a complaint with the Equal Employment Opportunity Commission, which can then file suit under its own behalf.

Fortunately, Title VII only applies to companies with 15 or more employees, but the states have similar statutes that requires various, and often lower, numbers of employees requires for an employee to bring an action under this statute. Title VII makes clear that it does not exempt any person from liability under similar State statutes, 42 USC 2000e-7.

It would be particularly tough to find a "non-pretextual" reason for the discharge from a position that was pretextual to begin with, and this can happen for many reasons. Boss Arny met Receptionist Katy on a flight from Oregon to Austin, and they hit it off. She was going to visit a friend, he was returning from a sales convention. A year later, he'd like her to move to Austin but her joint custody order from the last marriage requires her to get Court permission to leave Oregon. All the Oregon Family Court is asking for is a reason other than avoiding visitation by the natural father. So rather than tell the judge that she'd like to go live with her boyfriend, could he just hire her, say, to do some data entry and answer the phones?

Arny may not realize it, but if things do not work out with Katy in Austin, he is looking at a much bigger judgment for the discharge than he would if they married and divorced. Katy may get back pay from whenever the case goes to judgment, even if the job only lasted a month.

This would never happen in Family Court.

If it was later learned that the old friend that Katy was visiting on that first flight was really her lesbian lover, and that she allowed Arny to seduce and hire her for the sole and specific purpose of pleasing that Oregon Family Law judge, it would not help Arny in defending a case brought by the EEOC. The "unclean hands" defense is inapplicable against the EEOC. Katy would bring her child to Austin, and get paid a lot more from Arny on the job than she would be entitled to as spousal support.

With the DOW plummeting and companies firing loyal employees because they simply can no longer pay them, it might be tempting to hire the person you are living with or dating. Hopefully this article will make a business owner think twice about that treacherous proposal.

Nancy Lord, MD
Attorney at Law

www.nancylordltd.com