Trial Starts for Henderson Pediatrician Charged With Fraud - 8 News NOW

Trial Starts for Henderson Pediatrician Charged With Fraud

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LAS VEGAS -- The trial has started for a Henderson pediatrician who is accused of defrauding investors and chronically ill patients of large amounts of money through experimental stem cell implant procedures.

Dr. Ralph M. Conti, 50, and Alfred T. Sapse, 85, each face one count of conspiracy, 8 counts of mail fraud and 15 counts of wire fraud.

If convicted, both men face up to five years in prison on the conspiracy charge, up to 20 years in prison on each fraud charge, up to a $250,000 fine on each charge, and forfeiture of money or property of up to $913,748.

Sapse purports to be a retired foreign physician but has never been licensed to practice medicine in Nevada or any other state. From 2005 forward, he 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, according to the indictment.

The procedures involved implanting placental tissue into patients' abdomens for the treatment of their diseases. Sapse allegedly targeted extremely sick patients, claiming his "proprietary" procedure was especially effective for patients with multiple sclerosis, cerebral palsy and retinitis pigmentosa.

In fall 2005, Sapse hired Conti to perform the procedures even though the doctor had no prior stem cell training. At Sapse's direction, from February through November 2006, Conti allegedly performed the implant procedure on 34 patients in Las Vegas, knowing it would not benefit them. In November 2006, procedures performed by Conti allegedly resulted in the infection of several patients. That month the Food and Drug Administration sent Sapse and Conti a warning letter explaining that their procedure violated federal law. But Conti allegedly performed at least one more implant and Sapse coordinated implantations for at least two more patients.

To convince patients to undergo the procedures, Sapse falsely claimed that he studied at the Filatov Institute of Eye Diseases and Tissue Therapy, a prestigious clinic in Odessa, Ukraine. Sapse also created a corporation in Nevada to give the impression that he operated a pharmaceutical company. He also used websites and press releases to advertise to patients and investors that he had developed a novel medical procedure involving stem cells that would cure or ameliorate severe, incurable diseases such as multiple sclerosis and cerebral palsy.

Sapse allegedly made a number of misrepresentations to prospective patients and investors, including: the placental tissue used in the procedures was obtained only from Caesarian section births, so as to reduce the risk of passing infection; he achieved "considerable success" with a procedure that was going to "revolutionize medicine as it is known today"; wheelchair-bound patients would "definitely walk again"; and he subjected the placental tissue he obtained to a "proprietary process," such that the stem cells would express a special enzyme that would cause the cells to replicate indefinitely.

Sapse also allegedly failed to obtain FDA approvals, 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 regarding their involvement in the scheme to FDA regulatory investigators, 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 others.

In February 2007, Sapse relocated his fraudulent scheme to Mexico and entered into an arrangement with a Mexican physician with an office in Nuevo Progresso, Mexico, to perform the implant procedure. At Sapse's direction, the Mexican doctor performed the implant procedure on roughly 100 patients from February 2007 to May 2010 in Mexico.

Sapse allegedly received $1 million from patients and investors, $700,000 of which he spent on personal expenditures and casino gambling. Sapse 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 procedure he was promoting.

 

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