Man Sentenced To 17½ Years In Prison In Phony Stem Cell Case

         LAS VEGAS, Nev. – A man who conspired with a now-deceased Henderson pediatrician to take thousands of dollars from chronically ill patients for fraudulent stem cell implant procedures, was sentenced today to 17½ years in federal prison and ordered to pay approximately $1 million in restitution, announced Daniel G. Bogden, United States Attorney for the District of Nevada. 

            Alfred T. Sapse, 87, of Las Vegas, was sentenced by Senior U.S. District Judge Kent J. Dawson, and was immediately remanded to federal custody.  Sapse was convicted by a jury in November 2012 of conspiracy to commit mail fraud and wire fraud, seven counts of mail fraud, and 11 counts of wire fraud.  The co-defendant, Ralph M. Conti, M.D, of Henderson died several weeks following the conviction.

            “Using purported medical practices and procedures to steal from vulnerable persons who are ill is disgusting and wrong,” said U.S. Attorney Bogden.  “We will continue to use federal investigative and prosecutorial resources to ensure that persons who commit such crimes are held accountable and sent to prison.”

“Today’s sentence holds Mr. Sapse accountable for preying on patients who sought treatment for serious medical conditions, and demonstrates FDA’s commitment to protecting public health,” said Antoinette V. Henry, Special Agent in Charge, FDA Office of Criminal Investigations, Metro-Washington Field Office.

            According to the superseding indictment and evidence introduced by the government at trial, from about January 2005 to current, Sapse, who purports to be a retired foreign physician but who has never been licensed to practice medicine in Nevada or any other state, convinced chronically ill patients to undergo experimental implant procedures and convinced investors to pay him large amounts of money without knowing the short- or long-term effects of the implant procedures he promoted. The procedures involved the implantation of portions of placental tissue into the abdomen of the patients for the treatment of their diseases.  Sapse allegedly targeted extremely sick patients, by claiming that his “proprietary” procedure was especially effective for patients with multiple sclerosis, cerebral palsy and retinitis pigmentosa (a disease of the retina which can cause blindness.) 

 In the fall of 2005, Sapse hired Conti, a pediatrician in Henderson who had no prior stem cell training, to perform the procedures.  At Sapse’sdirection, between approximately February 2006 and November 2006, Conti performed the implant procedure on approximately 34 patients in Las Vegas, knowing that it would not benefit the patients.  During 2006, procedures performed by Dr. Conti resulted in the infection of at least two patients.  In November 2006, the FDA sent Sapse and Conti a warning letter explaining that their procedure violated federal law, but after that date Conti performed at least one more implant and Sapse coordinated the implantation of a least two more patients. 

Sapse and Conti made a number of misrepresentations to prospective patients and investors, including that the placental tissue used in the procedures was obtained only from Caesarian section births, so as to reduce the risk of passing infection, or otherwise to prevent “damage” to the placenta; that he had achieved “considerable success” with a procedure that was going to “revolutionize medicine as it is known today”; that wheelchair bound patients would “definitely walk again”; and that he subjected the placental tissue he obtained to a “proprietary process.”

Sapse failed to obtain any approvals from the FDA, as he knew he was required to do, prior to coordinating the implantation of placental cells in patients by Conti. Sapse and Conti made false representations to FDA regulatory investigators regarding their involvement in the scheme, conducted no meaningful follow-up with the patients who underwent the implant procedures, and concealed from patients and prospective patients the adverse effects suffered by previous patients.  

In about February 2007, Sapse relocated his fraudulent scheme to Mexico and entered into an arrangement with a Mexican physician in Nuevo Progresso, Mexico, to perform his implant procedure.  At Sapse’sdirection, the Mexican physician performed the implant procedure on approximately 100 patients between approximately February 2007 and May 2010 in Mexico.

Sapse received approximately $1 million from patients and investors, approximately $700,000 of which he spent on personal expenditures and for gambling at local casinos.  Conti received in excess of $60,000 from the fraudulent procedures, all of which was in cash and none of which was reported on the accounting books of his medical practice.  Sapse or Conti did not use any of the money for laboratory research, animal studies or human clinical studies relating to the short- and long-term effects of the implant procedures they were promoting.

            This case was investigated by the FDA Office of Criminal Investigations and prosecuted by Assistant U.S. Attorney Crane M. Pomerantz and First Assistant U.S. Attorney Steven W. Myhre.