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Nevada doctor indicted in alleged stem cell scam

By Ken Ritter
Associated Press / October 13, 2011

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LAS VEGAS—A Nevada pediatrician has been indicted by a federal grand jury on charges that he and a man falsely identifying himself as a doctor conspired to implant chronically ill patients with stem cells harvested from human placentas obtained after women gave birth.

Dr. Ralph Conti, 50, of Henderson, was due to appear Thursday before a federal magistrate judge in U.S. District Court in Las Vegas on a 34-count indictment accusing him and Alfred Sapse of Las Vegas of mail and wire fraud and conspiracy.

A message left Thursday for Conti at his practice, Foothills Pediatrics, was not immediately returned.

Sapse, 85, of Las Vegas, was already due to stand trial March 12 on 20 mail and wire fraud charges. He was indicted in July 2010 on charges revolving around a Las Vegas company he created in May 2005 called StemCell Pharma Inc. Prosecutors alleged at the time that he had unidentified doctors in Las Vegas and Mexico perform experimental surgical implants of placential tissue on about 134 patients.

Sapse's public defender, Richard Boulware, didn't immediately respond Thursday to requests for comment.

The indictment handed up Wednesday replaces the previous one against Sapse. He is accused of convincing patients in Las Vegas and Mexico to undergo abdominal implants of placental tissue for treatment of incurable diseases such as multiple sclerosis, cerebral palsy and the degenerative eye disease retinitis pigmentosa.

"By misrepresenting his credentials, the nature of his treatment, the source of his `stem cells,' and the adverse effects suffered by previous patients, defendant Sapse convinced chronically ill patients to undergo experimental implant procedures, many of which were performed by Conti," the indictment said.

The document chronicles payments of $2,500 for implants, and says the scheme reaped more than $1 million. Prosecutors allege that Sapse spent about $700,000 of the money on himself, including gambling sprees at Las Vegas casinos.

Prosecutors say Sapse had no medical license in Nevada or any other state, but claimed to be a retired physician who studied at the Filatov Institute of Eye Diseases and Tissue Therapy in Odessa, Ukraine.

The indictment alleges he hired Conti, who had no stem cell training, to perform placenta tissue implants on about 34 patients in Las Vegas from February to November 2006.

Prosecutors allege that several patients contracted infections, leading the federal Food and Drug Administration to issue a warning letter in November 2006. It said Sapse failed to properly obtain, store, test and process the placentas, or screen donors and patients.

A spokeswoman for U.S. Attorney Daniel Bogden declined Thursday to provide details about the infections, pending trial.

Three months after the FDA letter, Sapse moved his operation to Mexico and enlisted an unnamed physician in Nuevo Progresso, Mexico, according to the indictment. Prosecutors allege that doctor performed about 100 implant procedures from February 2007 to May 2010.

Sapse and Conti face decades in federal prison and millions of dollars in fines if convicted. The government also seeks the forfeiture of almost $914,000 it alleges is tied to the scheme.

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