Food and Drug Administration
Office of Criminal Investigations
U.S. Department of Justice Press Release
For Immediate Release
January 16, 2014
United States Attorney
Southern District of Texas
Contact: Angela Dodge
Public Affairs Officer
HOUSTON - Francisco Morales, 54, of Brownsville, has been sentenced for his role in a conspiracy to introduce misbranded and unapproved new drugs into interstate commerce, announced United States Attorney Kenneth Magidson. Morales and co-defendant Lawrence Stowe, 60, both falsely represented they were licensed to practice medicine in the United States. Morales operated a medical clinic in Brownsville, but was reportedly only licensed to practice in Mexico and carried out stem cell treatments for U.S. citizens in Mexico.
Today, U.S. District Judge Gray Miller handed Morales a sentence of 60 months in federal prison to be immediately followed by three years of supervised release. In handing down the sentence, Judge Miller noted his sentence was limited to 60 months by statute. Restitution was also ordered in the amount $479,862. Stowe is set for sentencing March 7, 2014.
On Sept. 5, 2012, Morales entered a guilty plea, admitting he sold an unapproved drug product to Stowe called SF 1019 knowing Stowe would sell this product to patients. Morales falsely represented to the public that he had extensive training and experience regarding stem cells and stem cell therapy, when his exposure was actually limited to attending seminars and reading materials published by researchers.
In June 2006, he received $8,300 from a couple to perform an unapproved stem cell procedure involving stem cells on their minor son who had experienced neurological problems after a near drowning incident. Prior to performing the procedure, Morales falsely represented that the stem cell procedure would be beneficial to combat the child's medical condition. He also falsely represented to two other patients that he obtained stem cells from private Universities and had treated more than 1000 patients using stem cells with only positive results.
Stowe admitted that beginning in January 2006, he utilized several businesses, Stowe BioTherapy Inc. and The Stowe Foundation to advertise and promote a medical treatment protocol for the treatment of amyotrophic lateral sclerosis (ALS) also known as Lou Gehrig's disease, multiple sclerosis (MS), Parkinson's and other neurological diseases. This treatment protocol, which was named "Applied Biologics," consisted of supplements, vaccines, patient specific transfer factors and ultimately stem cell therapy. Stowe falsely represented to patients that this treatment protocol had been reviewed by all levels of the FDA and was effective in the treatment of ALS, MS and Parkinson's. There is currently no cure for these diseases.
Morales also pleaded guilty in a second case for introducing stem cells extracted from umbilical cords into interstate commerce and introducing an unapproved new drug into interstate commerce. He admitted to purchasing stem cells from a company called Caledonia Consulting located in Mt. Pleasant, S.C. After acquiring stem cells from Caledonia, he would travel to Mexico and perform stem cell procedures, knowing the FDA had not approved the use of stem cells to treat human diseases. Morales further admitted that in April 2009, he began purchasing vials containing stem cells from a company called Global Laboratories. He will be sentenced in that case tomorrow, Jan. 17, 2014, at 4:00 p.m. before U.S. District Judge Ewing Werlein Jr.
Two others were also convicted in that case - Alberto Ramon, of Del Rio, Texas, and Vincent Dammai, of Mount Pleasant, S.C. They are set for sentencing Jan. 27, 2014.
The cases were investigated by the Food and Drug Administration (FDA) - Office of Criminal Investigations and the FBI with assistance from Internal Revenue Service-Criminal Investigation. Assistant United States Attorney (AUSA) Cedric L. Joubert and former AUSA Samuel J. Louis prosecuted the case with assistance of Carol Wallack with the Department of Justice Civil Division's Consumer Protection Branch.