Cancer Treatment Centers of America, Inc.; Midwestern Regional Medical Center, Inc.; Memorial Medical Center and Cancer Institute, Inc.; Consent Agreement With Analysis To Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 922-3308]

Cancer Treatment Centers of America, Inc.; Midwestern Regional

Medical Center, Inc.; Memorial Medical Center and Cancer Institute,

Inc.; Consent Agreement With Analysis To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Consent agreement.

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SUMMARY: In settlement of alleged violations of federal law prohibiting

unfair acts and practices and unfair methods of competition, this

consent agreement, accepted subject to final Commission approval, would

require the Arlington, Illinois-based company and two affiliated

hospitals to substantiate future claims regarding the success or

efficacy of their cancer treatments and to ensure that testimonials

they use do not misrepresent the typical experience of their patients.

The consent agreement settles allegations that the company and the

hospitals made false and unsubstantiated claims in advertising and

promoting their cancer treatments.

DATES: Comments must be received on or before May 28, 1996.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pa. Ave., N.W., Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT:

Richard F. Kelly, Federal Trade Commission, H-200, 6th and Pennsylvania

Ave, NW, Washington, DC 20580. 202-326-3304. Walter C. Gross, III,

Federal Trade Commission, H-200, 6th and Pennsylvania Ave, NW,

Washington, DC 20580. 202-326-3319.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal

Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Section 2.34 of

the Commission's Rules of Practice (16 CFR 2.34), notice is hereby

given that the following consent agreement containing a consent order

to cease and desist, having been filed with and accepted, subject to

final approval, by the Commission, has been placed on the public record

for a period of sixty (60) days. Public comment is invited. Such

comments or views will be considered by the Commission and will be

available for inspection and copying at its principal office in

accordance with Section 4.9(b)(6)(ii) of the Commission's Rules of

Practice (16 CFR 4.9(b)(6)(ii)).

Before Federal Trade Commission

In the Matter of Cancer Treatment Centers of America, Inc., a

corporation, Midwestern Regional Medical Center, Inc., a

corporation, and Memorial Medical Center and Cancer Institute, Inc.,

a corporation; Agreement Containing Consent Order to Cease and

Desist.

The Federal Trade Commission having initiated an investigation of

certain acts and practices of Cancer Treatment Centers of America,

Inc., a corporation, Midwestern Regional Medical Center, Inc., a

corporation, and Memorial Medical Center and Cancer Institute, Inc., a

corporation (hereinafter sometimes referred to as ``proposed

respondents'' or ``respondents''), and it now appearing that proposed

respondents are willing to enter into an agreement containing an order

to cease and desist from the use of the acts and practices being

investigated.

It is hereby agreed by and between Cancer Treatment Centers of

America, Inc., a corporation, Midwestern Regional Medical Center, Inc.,

a corporation, and Memorial Medical Center and Cancer Institute, Inc.,

a corporation, and their attorneys, and counsel for the Federal Trade

Commission that:

1. Proposed respondent Cancer Treatment Centers of America, Inc.,

is an Illinois corporation, with its principal office or place of

business at 3455 Salt Creek Lane, Suite 200, Arlington, Illinois 60005-

1090.

Proposed respondent Midwestern Regional Medical Center, Inc., is an

Illinois corporation, with its principal office or place of business at

Shiloh Boulevard and Emmaus Avenue, Zion, Illinois 60099.

Proposed respondent Memorial Medical Center and Cancer Institute,

Inc., is an Oklahoma corporation, with its principal office or place of

business at 8181 South Lewis Avenue, Tulsa, Oklahoma 74137.

2. Proposed respondents admit all the jurisdictional facts set

forth in the attached draft complaint.

3. Proposed respondents waive:

(a) Any further procedural steps;

(b) The requirement that the Commission's decision contain a

statement of findings of fact and conclusions of law;

(c) All rights to seek judicial review or otherwise to challenge or

contest the validity of the Order entered pursuant to this agreement;

and

(d) Any claim under the Equal Access to Justice Act, 5 U.S.C. 504.

4. This agreement shall not become part of the public record of the

proceeding unless and until it is accepted by the Commission. If this

agreement is accepted by the Commission, it, together with the attached

draft complaint, will be placed on the public record for a period of

sixty (60) days and information in respect thereto publicly released.

The Commission thereafter may either withdraw its acceptance of this

agreement and so notify the proposed respondents, in which event it

will take such action as it may consider appropriate, or issue and

service its complaint (in such form as the circumstances may require)

and decision, in disposition of the proceeding.

5. This agreement is for settlement purposes only and does not

constitute an admission by proposed respondents of facts, other than

jurisdictional facts, or of violations of law as alleged in the draft

of complaint here attached.

6. This agreement contemplates that, if it is accepted by the

Commission, and if such acceptance is not subsequently withdrawn by the

Commission pursuant to the provisions of Sec. 2.34 of the Commission's

Rules, the Commission may, without further notice to proposed

respondents: (a) Issue its complaint corresponding in form and

substance with the attached draft complaint and its decision containing

the following Order to cease and desist in disposition of the

proceeding; and (b) make information public in respect thereto. When so

entered, the Order to cease and desist shall have the same force and

effect and may be altered, modified or set aside in the same manner and

within the same time provided by statute for other orders. The Order

shall become final upon service. Delivery by the U.S. Postal Service of

the complaint and decision containing the agreed-to Order to proposed

respondents' address as stated in this agreement shall constitute

service. Proposed respondents waive any right they may have to any

other manner of service. The complaint may be used in construing the

terms of the Order, and no agreement, understanding, representation, or

interpretation not contained in the Order or the agreement may be used

to vary or contradict the terms of the Order.

7. Proposed respondents have read the attached draft complaint and

the following Order. Proposed respondents understand that once the

Order has been issued, they will be required to file one or more

compliance reports showing

[[Page 13198]]

that they have fully complied with the Order. Proposed respondents

further understand that it may be liable for civil penalties in the

amount provided by law for each violation of the Order after it becomes

final.

Order

Definitions

For the purposes of this Order, the following definitions shall

apply:

A. ``Competent and reliable scientific evidence'' shall mean tests,

analyses, research, studies or other evidence based on the expertise of

professionals in the relevant area that have been conducted and

evaluated in an objective manner by persons qualified to do so, using

procedures generally accepted in the profession to yield accurate and

reliable results.

B. ``Cancer'' shall mean any of various malignant neoplasms

characterized by the proliferation of anaplastic cells that tend to

invade surrounding tissue and may metastasize to new body sites or the

pathological condition characterized by such growths.

C. ``Independent organization or facility'' means any organization,

association, or entity, whether or not for profit, which is not owned

or controlled, directly or indirectly, by respondents, individually or

collectively.

D. ``Endorsement'' means any advertising message (including verbal

statements, demonstrations or depictions of the name, signature,

likeness or other personal identifying characteristics of any

individual or the name or seal of an organization) which message

consumers are likely to believe reflects the opinions, beliefs,

findings, or experience of a party other than the sponsoring

advertiser.

I

It is ordered that respondents Cancer Treatment Centers of America,

Inc., a corporation, Midwestern Regional Medical Center, Inc., a

corporation, and Memorial Medical Center and Cancer Institute, Inc., a

corporation, their successors or assigns, (hereinafter sometimes

referred to as ``respondents''), and respondents' officers,

representatives, agents, and employees, directly or through any

corporation, subsidiary, division, or other advice, including

franchisees or licensees, in connection with the advertising,

promotion, offering for sale, or sale of products or services

purporting to treat or cure disease, in or affecting commerce, as

``commerce'' is defined in the Federal Trade Commission Act, do

forthwith cease and desist from:

A. Making any representation, directly or by implication, about

either:

(1) The existence or content of statistical data that purports to

document survivorship rates or cure rates for cancer patients in

respondents' treatment facilities, or

(2) Cure rates or survivorship rates either for any of respondents'

treatment facilities or for any treatment modality or modalities

offered by respondents.

unless, at the time of making any such representation, respondents

possess and rely upon competent and reliable evidence, which when

appropriate must be competent and reliable scientific evidence,

substantiating the representation.

B. Representing, directly or by implication, that any modality for

the treatment or mitigation of cancer or its attendant symptoms is

approved, endorsed or accepted by any independent organization or

facility unless, at the time of making any such representation,

respondents possess and rely upon competent and reliable evidence,

which when appropriate must be competent and reliable scientific

evidence, substantiating the representation.

C. Making any representation, directly or by implication, about the

efficacy of any modality that purports to treat or mitigate cancer or

its attendant symptoms, unless, at the time of making any such

representation, respondents possess and rely upon competent and

reliable scientific evidence substantiating the representation.

D. Representing, directly or by implication, that any endorsement

of any of respondents' treatment programs that purport to mitigate or

cure cancer represents the typical or ordinary experience of members of

the public who use the program, unless:

(1) At the time of making such representation, respondents possess

and rely upon competent and reliable scientific evidence, that

substantiates such representation, or

(2) Respondents disclose clearly, prominently and in close

proximity to the endorsement or testimonial either:

(a) What the generally expected results would be for users of such

program, or

(b) The limited applicability of the endorser's experience to what

consumers may generally expect to achieve, that is, that consumers

should not expect to experience similar results.

E. Making any representation, directly or by implication, about the

performance, safety or benefits of any modality that purports to treat

or mitigate cancer, its attendant symptoms or attendant diseases,

unless, at the time of making any such representation, respondents

possess and rely upon competent and reliable scientific evidence

substantiating the representation.

II

It is further ordered that respondents shall notify the Commission

at least thirty (30) days prior to the effective date of any proposed

change such as dissolution, assignment, or sale resulting in the

emergence of a successor corporation(s), the creation or dissolution of

subsidiaries, or any other change in the corporation(s) that may affect

compliance obligations arising out of this Order.

III

It is further ordered that for three (3) years after the last date

of dissemination of any representation covered by this Order,

respondents, or their successors and assigns, shall maintain and upon

request make available to the Federal Trade Commission for inspection

and copying:

A. All materials that were relied upon in disseminating such

representation; and

B. All tests, reports, studies, surveys, demonstrations or other

evidence in their possession or control that contradict, qualify, or

call into question such representation, or the basis relied upon for

such representation, including complaints from consumers.

IV

It is further ordered that within ten (10) days from the date of

service of this order, respondents shall distribute a copy of this

Order to each of its officers, agents, representatives, independent

contractors and employees who are involved in the preparation and

placement of advertisements or promotional materials or who have any

responsibilities with respect to the subject matter of this Order; and,

shall secure from each such person a signed statement acknowledging

receipt of this order.

V

It is further ordered that respondents shall, within sixty (60)

days after the date of service of this Order, file with the Commission

a report, in writing, setting forth in detail the manner and form in

which they have complied with this Order.

Analysis of Proposed Consent Order To Aid Public Comment

The Federal Trade Commission has accepted an agreement to a

proposed

[[Page 13199]]

consent order from three corporations who operate under the trade name

Cancer Treatment Centers of America and offer cancer treatment services

to the public. The three corporations are: Cancer Treatment Centers of

America, Inc., Midwestern Regional Medical Centers, Inc., and Memorial

Medical Center and Cancer Institute, Inc.

The proposed consent order has been placed on the public record for

sixty (60) days for reception of comments by interested persons.

Comments received during this period will become part of the public

record. After sixty (60) days, the Commission will again review the

agreement and will decide whether it should withdraw from the agreement

or make final the agreement's proposed order.

The Commission has alleged that proposed respondents failed to

possess a reasonable basis for claiming that their five year

survivorship rates for cancer patients that they treated was ``among

the highest recorded.'' The Commission further alleges that

representations proposed respondents made about the ability of

treatments known as ``whole body hyperthermia'' and ``brachytheraphy''

to successfully treat some cancers and/or improve survivorship rates

were also unsubstantiated.

Additionally, the Commission has alleged that proposed respondents

claimed that whole body hyperthermia was ``an approved medical

procedure,'' implying that the procedure had been approved by an

independent agency or medical body when, in fact, it had not. Finally,

the Commission has alleged that proposed respondents failed to

substantiate advertisements that featured the treatment experiences of

former patients and represented, expressly or by implication, that such

experiences represented the typical and ordinary experience of

consumers of proposed respondents' treatment services.

The proposed consent order addresses the alleged misrepresentations

cited in the accompanying complaint by requiring, among other things,

that proposed respondents possess a reasonable basis consisting of

competent and reliable evidence for any future claims regarding

survivorship or cure rates. When appropriate the order would require

that such evidence be competent and reliable scientific evidence.

Additionally, under the order, any efficacy claims for any modality

that purports to treat or mitigate cancer or its attendant symptoms

must also be substantiated with competent and reliable scientific

evidence.

The order further prohibits proposed respondents from

misrepresenting that any independent organization has approved any

treatment regimen for cancer. The order also requires that any future

claims containing consumer endorsements or testimonials either

represent the typical and ordinary experience of consumers of proposed

respondents' services or contain a clear and prominent statement

referring to the limited applicability of the endorser's experience.

Finally, the order requires competent and reliable scientific evidence

for any representation about the performance, safety, or benefits of

any modality that purports to treat or mitigate cancer, its attendant

symptoms or attendant diseases.

The purpose of this analysis is to facilitate public comment on the

proposed order, and is not intended to constitute an official

interpretation of the agreement and proposed order or to modify in any

way their terms.

Donald S. Clark,

Secretary.

[FR Doc. 96-7293 Filed 3-25-96; 8:45 am]

BILLING CODE 6750-01-M