On August 27, 2024, the Department of Justice announced that John W. Kosolcharoen, founder and CEO of a California-based company, pleaded guilty to a felony violation of the Federal Food, Drug, and Cosmetic Act. Kosolcharoen’s plea relates to the distribution of unapproved stem cell products that were linked to adverse reactions, including hospitalizations.
According to court documents, Kosolcharoen’s companies, Liveyon LLC and Genetech Inc., manufactured and distributed injectable stem cell products made from human umbilical cord blood, marketed under the brand name “ReGen.” The government alleged that these products were falsely promoted as suitable treatments for conditions such as lung and heart diseases, autoimmune disorders, Alzheimer’s disease, and Parkinson’s disease, among others. The marketing materials used by Liveyon contained statements that were allegedly false and misleading regarding the products’ safety and effectiveness.
According to the government, Kosolcharoen directed Liveyon’s purchase orders to “falsely state” that the stem cell products were sold “for research purposes only” to avoid FDA scrutiny. The FDA and the Centers for Disease Control and Prevention (CDC) reported that, in 2018, patients in multiple states were hospitalized for bacterial infections after receiving Liveyon products. The government contends Kosolcharoen and others misled customers by downplaying the severity of these adverse events and misrepresenting the findings of an FDA inspection.
Kosolcharoen is currently serving a sentence for a separate, unrelated conviction and is scheduled to be sentenced for this case on September 23, 2024. He faces potential penalties, including imprisonment, fines, and restitution. The final sentence will be determined by a federal district court judge.
Cases like this highlight the importance of compliance with federal regulations when marketing and distributing medical products. Companies should say informed and ensure that their practices align with FDA standards to avoid investigations and potential criminal charges. If you have questions about FDA compliance or face regulatory challenges, seeking legal counsel can help navigate complex regulatory requirements.
The attorneys at Chilivis Grubman represent clients of all types and sizes in connection with FDA-related matters, regulatory investigations, and healthcare compliance issues. If you need assistance with such a matter, please contact us today.