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WARNING LETTER
Warning Letter #OBPO 19-09

August 28, 2019

Dear Dr. Taeidi:

During an inspection of your firm, Stemell, Inc. (Stemell), located at 27122b Paseo Espada, Suite 1004, San Juan Capistrano, CA 92675, conducted from March 4, 2019 to March 8, 2019, the Food and Drug Administration (FDA) documented that your firm manufactures products derived from human umbilical cord blood and umbilical cord, StemL UCB-Plus™ and StemL UCT-Plus™, for allogeneic use (referred to as "umbilical cord products" or "products"). You describe your firm as "specializing in the harvesting and isolation of stem cells to manufacture and commercialize innovative products," and you distribute your products directly to physicians throughout the United States.

Information and records gathered at the time of and after the inspection, including product labeling and information on your website, https://stemell.com, reflect that your products, which your firm refers to as "regenerative cellular therapy," are intended for clinical use in humans to treat a variety of diseases or conditions. You offer your products to medical professionals, clinics, and hospitals for use during "treatment procedure[s]." You specifically market your products to "[c]ombat inflammatory conditions such as arthritis" and more generally to "expedit[e] the healing process" and as an alternative to surgery. Stemell also encourages patients to consult with their doctors for more information about "the many additional potential uses" of your products.

Therefore, based on your objective intent, your products are drugs as defined in section 201(g) of the Federal Food, Drug, and Cosmetic Act (FD&C Act) [21 U.S.C. 321(g)] and biological products as defined in section 351(i) of the Public Health Service Act (PHS Act) [42 U.S.C. 262(i)].

Your website includes certain disclaimer language, including that "[s]tem cells, like other medical products that are intended to treat, cure or prevent disease, generally require FDA approval before they can be marketed," but that "Stemell, Inc. is a supplier only ... and ... is not claiming to cure or treat any disorder or condition." The Terms and Conditions of Sale section of your website further states, "The physician and the clinic are absolutely not allowed under Stemell, Inc.'s name to make claims for any cure or treating a disorder. If they do, Stemell, Inc. is neither responsible nor liable for any medical claims by the physician or the clinic." (Emphasis added.) Your disclaimers do not alter the fact that your products are "drugs" and "biological products" within the meaning of the FD&C and PHS Acts, respectively.

Your products are also human cells, tissues, or cellular or tissue-based products (HCT/Ps) as defined in 21 CFR 1271.3(d)1 and are subject to regulation under 21 CFR Part 1271, issued under the authority of section 361 of the PHS Act [42 U.S.C. 264]. HCT/Ps that do not meet all the criteria in 21 CFR 1271.10(a), and when no exception in 21 CFR 1271.15 applies, are not regulated solely under section 361 of the PHS Act [42 U.S.C. 264] and the regulations in 21 CFR Part 1271. Such products are regulated as drugs, devices, and/or biological products under the FD&C Act and/or the PHS Act, and are subject to additional regulation, including appropriate premarket review.

Stemell does not qualify for any exception in 21 CFR 1271.15, and the products fail to meet all the criteria in 21 CFR 1271.10(a). Therefore, your products are not regulated solely under section 361 of the PHS Act [42 U.S.C. 264] and the regulations in 21 CFR Part 1271.

Specifically, your products fail to meet 21 CFR 1271.10(a)(2)'s criterion that the HCT/P be "intended for homologous use only, as reflected by the labeling, advertising, or other indications of the manufacturer's objective intent." Because the products are not intended to perform the same basic function or functions of umbilical cord blood or umbilical cord in the recipient as in the donor, such as forming and replenishing the lymphohematopoietic system (for cord blood) and serving as a conduit (for umbilical cord), using the products to treat arthritis, for example, is not homologous use as defined in 21 CFR 1271.3(c).

In addition, your products fail to meet other criteria set forth in 21 CFR 1271.10(a). The umbilical cord blood product, StemL UCB-Plus™, fails to meet 21 CFR 1271.10(a)(4). This product, manufactured from donated umbilical cord blood, is dependent on the metabolic activity of living cells for its primary function and is not for autologous use, allogeneic use in a first-degree or second-degree blood relative, or reproductive use. The umbilical cord product, SternL UCT-Plus™, fails to meet the minimal manipulation criterion set forth in 21 CFR 1271.10(a)(l) and defined for structural tissue in 21 CFR 1271.3(f)(1). The product does not meet this criterion because your processing alters the original relevant characteristics of the umbilical cord related to its utility for reconstruction, repair, or replacement.

As stated above, because your products do not meet all the criteria in 21 CFR 1271.10(a), and Stemell does not qualify for any exception in 21 CFR 1271.15, the products are regulated as drugs as defined in section 201(g) of the FD&C Act [21 U.S.C. 321(g)] and biological products as defined in section 351(i) of the PHS Act [42 U.S.C. 262(i)].2 Please be advised that to lawfully market a drug that is a biological product, a valid biologics license must be in effect [42 U.S.C. 262(a)]. Such licenses are issued only after showing that the product is safe, pure, and potent. While in the development stage, such products may be distributed for clinical use in humans only if the sponsor has an investigational new drug application (IND) in effect as specified by FDA regulations [21 U.S.C. 355(i); 42 U.S.C. 262(a)(3); and 21 CFR Part 312]. The umbilical cord products are not the subject of an approved biologics license application (BLA) nor is there an IND in effect. Based on this information, we have determined that your actions have violated the FD&C Act and the PHS Act. Your disclaimers do not remedy your violations.

Additionally, during the inspection, FDA investigators documented evidence of significant deviations from current good manufacturing practice (CGMP) and current good tissue practice (CGTP), including deviations from section 501(a)(2)(B) of the FD&C Act and 21 CFR Parts 210, 211, and 1271. The deviations in manufacturing processes observed as well as those noted in documents collected during the inspection indicate that the use of your products raises potential significant safety concerns. For example, Stemell's deficient donor eligibility practices, unvalidated manufacturing processes, deficient environmental monitoring, and inadequate aseptic practices, as described below, pose a significant risk that your products may be contaminated with viruses or microorganisms or have other serious product quality defects.

At the close of the inspection, FDA investigators issued a Form FDA 483 to you listing inspectional observations, which described a number of significant deviations from CGMP and CGTP. FDA has found additional significant deviations upon further review of the information collected during the March 2019 inspection as discussed below. The deficiencies include, but are not limited to, the following:

1. Failure of a responsible person to determine and document the eligibility of a cell or tissue donor based upon the results of donor screening and donor testing [21 CFR 1271.50(a)]. Stemell is the establishment responsible for making the donor eligibility determination. Since operations began in November 2017, your firm has failed to document whether donors of umbilical cord blood and umbilical cord are eligible. Although you receive relevant medical records from your recovery agency, including a medical/social history interview and a physical examination, you do not document the donor eligibility determination.

2. Failure to establish and maintain procedures for all steps performed in testing, screening, and determining donor eligibility, and complying with all other requirements of Subpart C "Donor Eligibility'' in 21 CFR 1271.45-1271.90. "Establish and maintain'' means define, document (in writing or electronically), and implement; then follow, review, and as needed, revise on an ongoing basis [21 CFR 1271.47(a)]. For example, your firm failed to establish and maintain procedures for determining donor eligibility to adequately and appropriately reduce the risk of transmission of relevant communicable diseases.

3. Failure to establish and follow appropriate written procedures designed to prevent microbiological contamination of drug products purporting to be sterile, including procedures for validation of all aseptic and sterilization processes [21 CFR 211.113(b)]. For example:

A. The aseptic processes used to manufacture your products have not been validated. By the nature of their routes of administration, and per your product labeling, your products purport to be sterile and are expected to be sterile.

B. Your aseptic practices for material transfer into the cleanroom are inadequate in that, during the manufacture of StemL UBC-Plus™ batches (b)(4), FDA investigators observed that the aseptic operator opened the (b)(4) sterile package of vials in the Class 10,000 gowning room, instead of inside the Class 100 (b)(4) in the Class 100 cleanroom, before filling product into the vials. Additionally, three of these vials dropped on the floor in the Class 10,000 gowning room and were subsequently used to fill product.

C. There were three environmental monitoring excursions on February 16, 2019. The growth was identified and reported as Kocuria salsicia for one of the samples, which was collected from the Class 100 (b)(4) during processing. Your firm did not provide evidence that you investigated these excursions to determine product impact, root cause, and corrective and preventive actions.

D. Written procedures have not been established and followed to assure that components from multi-use containers, that are intended to be sterile, remain sterile over the period of use. (b)(4) and (b)(4), used to manufacture your products, are opened and used over multiple (b)(4) of manufacturing.

4. Failure to have separate or defined areas or such other control systems as necessary to prevent contamination or mixups during the course of aseptic processing, including, as appropriate, a system for monitoring environmental conditions and a system for cleaning and disinfecting the room and equipment to produce aseptic conditions [21 CFR 211.42(c)(10)]. For example:

A. Environmental monitoring had only been performed (b)(4) since manufacturing began in November 2017. Although you established a written environmental monitoring procedure, it is deficient in that it does not include established alert and action limits or provisions to investigate results that exceed limits or demonstrate an adverse trend other than to identify any contamination.
B. No personnel monitoring had been performed since manufacturing began at your firm.
C. Your firm failed to provide evidence that cleaning and disinfection of the Class 100 aseptic processing area and the supporting Class l 0,000 gowning room was performed prior to January 2019. Moreover, the process for cleaning and disinfecting the Class 100 aseptic processing area and equipment observed by the investigators during the inspection was not in writing and has not been validated.
D. Your firm failed to use disinfectant agents that are appropriate for use for cleaning the (b)(4) centrifuge,(b)(4) incubator, and (b)(4). For example, you use non-sterile disinfectants and non-sterile wipes, and there is no evidence that a sporicidal agent is used.

5. Failure to establish written procedures for production and process control designed to assure drug products have the identity, strength, quality, and purity they purport or are represented to possess (21 CFR 211.100(a)]. For example, the manufacturing processes for your products have not been validated.

6. Failure to establish and follow written procedures describing in sufficient detail the receipt, identification, storage, handling, sampling, testing, and approval or rejection of components and drug product containers and closures [21 CFR 211.80(a)]. For example, there are no written procedures describing in sufficient detail the criteria for approval or rejection of incoming umbilical cord blood or umbilical cord.

7. Failure to establish laboratory controls that include scientifically sound and appropriate specifications, standards, sampling plans, and test procedures designed to assure that components, drug product containers, closures, in-process materials, labeling, and drug products conform to appropriate standards of identity, strength, quality, and purity (21 CFR 211.160(b)]. For example, your firm has not established scientifically sound and appropriate specifications to assure your products conform to appropriate standards of identity, strength, quality and purity.

8. Failure to establish and follow a written testing program designed to assess the stability characteristics of drug products and to use results of such stability testing to determine appropriate storage conditions and expiration dates [21 CFR 211.166(a)). For example, you assign a one-year expiration date to batches of products without supporting data.

9. Failure to perform routine calibration, inspection, or checking of electronic equipment according to a written program designed to assure proper performance, and to maintain written records of such calibration checks and inspections [21 CFR 211.68(a)]. For example, you have not maintained temperature records for the cold storage units used to store your products, and you have not established an appropriate written program designed to assure proper performance of such units.

10. Failure to establish and follow written procedures describing the handling of all written and oral complaints regarding a drug product [21 CFR 211.198(a)]. For example, your firm did not provide evidence during the inspection of written procedures for handling complaints regarding your products.

11. Failure to establish a quality control unit that has the responsibility and authority to approve or reject all components, drug product containers, closures, in-process materials, packaging material, labeling, and drug products, and the authority to review production records to assure that no errors have occurred or, if errors have occurred, that they have been fully investigated [21 CFR 211.22(a)],

We reviewed your written responses, dated March 26, 2019, April 30, 2019, June 11, 2019, and July 29, 2019, to the inspectional observations on the Form FDA 483. We acknowledge the corrective actions you have taken in response to the observations, your commitment to implement additional corrective actions, and your plan to provide updates. However, based on the information you provided for review, we have concerns regarding the adequacy of your corrective actions to date including, but not limited to, those pertaining to donor eligibility determinations, aseptic process validation, validation of the manufacturing processes, your stability program, cleanroom qualification, and the responsibilities of your quality unit. Notably, your responses do not address your firm's immediate plans regarding the continued manufacture of your products, given the significant deficiencies identified, or the potential serious risks to patients your manufacturing violations present.

Your responses also do not address your failure to have an IND in effect to study your products, nor your lack of an approved BLA to lawfully market your products. As noted above, to lawfully market a drug that is a biological product, a valid biologics license must be in effect [42 U.S.C. 262(a)]. Such licenses are issued only after showing that the product is safe, pure, and potent. While in the development stage, such products may be distributed for clinical use in humans only if the sponsor has an IND in effect as specified by FDA regulations [21 U.S.C. 355(i); 42 U.S.C. 262(a)(3); 21 CFR Part 312]. The umbilical cord products are not the subject of an approved BLA nor is there an IND in effect for your products.

We also note that your website contains the FDA logo. The FDA logo is for the official use of FDA and not for use on private sector materials. Unauthorized use of the FDA logo may violate federal law and subject those responsible to civil and/or criminal liability.

Neither this letter nor the observations noted on the Form FDA 483, which were discussed with you at the conclusion of the inspection, are intended to be an all-inclusive list of deficiencies that may exist at your facility. It is your responsibility to ensure full compliance with the FD&C Act, PHS Act, and all applicable regulations.

You should take prompt action to correct the deviations set forth above. Failure to do so may result in regulatory action without further notice. Such actions may include seizure and/or injunction.

For further information about IND requirements for biological products, contact the Center for Biologics Evaluation and Research (CBER), Division of Regulatory Project Management, Office of Tissues and Advanced Therapies at (240) 402-8190 or email OTATRPMS@fda.hhs.gov. Please include a copy of this letter with your initial submission to CBER.

We request that you respond in writing within fifteen (15) working days of receipt of this letter, outlining the specific steps you have taken or plan to take to correct the noted violations and to prevent their recurrence. Include any documentation necessary to show that correction has been achieved. If you do not believe your products are in violation of the FD&C Act, PHS Act, or applicable regulations, include your reasoning and any supporting information for our consideration. If you cannot complete all corrective actions within fifteen (15) working days, please explain the reason for your delay and the time frame within which the remaining corrections will be completed.

Your response should be sent to the following address: Michele L. Forster, PhD, Compliance Officer, U.S. Food and Drug Administration, 678 Front Ave. NW, Suite 225, Grand Rapids, MI 49504, or emailed to Michele.Forster@fda.hhs.gov. If you have any questions, please contact Michele Forster by phone at (616) 233-9311 extension 1017 or via email.

Sincerely,

/S/

Karlton T. Watson
Program Division Director
Office of Biological Products Operations - Division II
cc: Bruce Fishman, MD, MPH
Medical Director, Stemell, Inc.
27122b Paseo Espada, Suite 1004
San Juan Capistrano, CA 92675
Stemell, Inc.
 

______________________

1 HCT/Ps are defined as "articles containing or consisting of human cells or tissues that are intended for implantation, transplantation, infusion, or transfer into a human recipient." [21 CFR 1271.3(d)]
2 Although the focus of FDA's inspection and thus this letter are StemL UCB-Plus™ and StemL UCTPlus™, we note that you recently started manufacturing an exosome product referred to as StemL XPlus™. As a general matter, exosomes for clinical use in humans are regulated as drugs and biological products under section 351 of the PHS Act and the FD&C Act and are subject to premarket review and approval requirements.