In the Matter of the Complaint Against

CONAN RESEARCH
P. O. Box 442
at Twinsburg, OH 44087

P.S. Docket No. 12/7;

01/28/82

Grant, Quentin E.

APPEARANCE FOR COMPLAINANT:
Sandra C. McFeeley, Esq.;
Consumer Protection Division,
Law Department,
United States Postal Service,
Washington, DC 20260-1112

APPEARANCE FOR RESPONDENT:
Jack Paller, Esq.;
Katz, Paller & Land,
470 East Paces Ferry Road,
Suite 2000, Atlanta, GA 30363

INITIAL DECISION

In this proceeding the Complainant alleges that Respondent is violating 39 U.S.C. § 3005 by selling its product, Bio-Genesis, and receiving remittances therefor, through the mails by means of false representations concerning the efficacy of the product. Complainant asks for an order stopping Respondent's mail with respect to Bio Genesis.

Respondent denies that it is in violation of the statute.

The parties have submitted the matter for decision on a Stipulation of Evidence dated October 22, l981, which reads as follows:

"STIPULATION OF EVIDENCE"

Pursuant to the Order of October 13, l981, the parties by agreement offer as their evidence in this matter the following exhibits and portions of the hearing transcript in Cosvetic Labs, et al., P.S. Docket 8/160, et al.

Testimony of: Transcript Pages

Dr. Sorrell Schwartz 67-105; 136-139; 175-178

Inspector William Powers 196-269

Dr. Karl Kramer 271-326 (top half)

381-428; 858-855 (sic) (top half)

Dr. Ilona Schreck-Purola 503-569

Dr. Rolf Nordstrom 571-651

Dr. Gollnick 652-682; 717-741

Peter Morrison 686-692

Vincent Messina 693-700

Dante Ruccio 701-709

Documentary Evidence

Copies of 1974 and 1978 Studies

All documentary evidence introduced through Drs.

Purola, Nordstrom and Gollnick

Curriculum Vitae of Drs. Schwartz, Kramer, Purola

Nordstrom and Gollnick

In addition, the parties stipulate to the following factual matters:

1. The documents attached to the complaint herein as exhibits one through three are used and published to members of the public by or on behalf of Respondent.

2. A person who mails the order form shown on Exhibit two, together with the appropriate payment, to Respondent at P. O. Box 442, Twinsburg, Ohio 44987 will receive from Respondent a bottle of 'Bio-Genesis' labelled as shown on Exhibit A-1-b of the P.S. Docket 8/160, et al. hearing exhibits."

Pursuant to the foregoing stipulation, transcript and exhibit references in the findings of fact herein, except as otherwise indicated, are to the transcript and exhibits in Cosvetic Labs, et al., P.S. Docket Nos. 8/160, et al.

It is assumed that Complainant here adopts the stipulated testimony of Complainant's witnesses in P.S. Docket 8/160, et al. and that Respondent does the same as to the stipulated testimony of the respondents in those cases.

The parties have filed proposed findings of fact, conclusions of law and argument, all of which have been considered in arriving at this decision. To the extent indicated, they have been adopted. Otherwise they have been rejected as irrelevant, immaterial, or not supported by the evidence.

FINDINGS OF FACT

1. The advertisements attached to the Complainant as exhibits ONE, TWO and THREE are used by Respondent to promote the sale of its product, Bio-Genesis (Stip. par. No. 1) Such exhibits are annexed to this decision as Exhibits A, B, and C, respectively .

2. Persons who mail the order form shown on Exhibit TWO to the Compliant, together with the appropriate payment to Respondent at P. O. Box 442, Twinsburg, Ohio 44087, receive from Respondent a bottle of Bio-Genesis labelled as follows:

BIO-GENESIS

1 FL. OZ.

DIRECTIONS: Biogenesis is a slightly oily solution. Shake first, then with a drop or two, draw quantity of biogenesis from bottle. Part your hair and apply to scalp. Gently massage your scalp prior to and following the application. The longer Biogenesis can penetrate the better. For example, apply it in the evening and rinse out the following morning.

INGREDIENTS: Water, SD-40 alcohol, Polysorbate 60, Bio-concentrate (Germany), Urea, Biotin, Niacin, Glucosefructose. Tyrosine, Cystine, Lysine, Methionine, Serine, Proline, Valine, Lactic Acid, Fragrance.

KEEP OUT OF REACH OF CHILDREN

(Stip. par. No. 2; Ex. A-1-b)

___________

The Complaint (Par. III) alleges that Respondent's promotional materials make certain representations concerning Bio-Genesis which are materially false in fact. In Findings of Fact Nos. 3 and 4 below, each of the alleged representations is treated separately. The exhibit references in Finding of Fact No. 3 are to Exhibits A, B, and C annexed to this decision. In making these findings I have employed the standards of interpretation applicable in proceedings under 39 U.S.C. § 3005 (See Conclusions of Law).

___________

3. a. BIO-GENESIS will prevent the hair loss and balding associated with hereditary tendency to baldness.

This representation is made in the title of Ex. A - "A NEW REMEDY FOR THE PREVENTION AND CORRECTION OF PROGRESSIVE BALDNESS" together with the first and last paragraphs of that exhibit.

b. 80% of all bald or balding users of BIO-GENESIS may expect, as a result of such use, to regrow hair.

This claim is expressly made in Exhibit B: "Eight out of ten patients showed follicle rejuvenation after they had been treated . . . Because 80% of those treated had regrown." And in Exhibit C: ". . among volunteers who applied Bio-Genesis to their scalp for 28 weeks, hair growth resumed in 80 percent of the cases and hair loss decreased within four weeks."

c. BIO-GENESIS will cause growth of new hair on a bald or balding scalp.

This claim is made in the last paragraph of Exhibit A, p. 1 and in the testimonial letters from "C D Washington, DC," "VND Whitestone, NY," "RF Illinois," and "MW Laurelton, NY" in Exhibit A, p. 2. It is made on page 3 of Exhibit A in the caption of the "6 months" picture: "The evidence of new, thick, and dense hair growth, on what was six months ago by bald spot, is clearly visible." The claim is made in the headlines and throughout Exhibits B and C.

d. Cholesterol causes the formation of the male hormone, testosterone, and DHT* in the scalp; and removal of cholesterol will result in growth of hair on the bald or balding scalp.

e. BIO-GENESIS will neutralize or remove cholesterol from the scalp.

These representations are made in the third and fourth columns of Exhibit B.

f. BIO-GENESIS will cause regeneration of the hair follicle.

This representation is made, among other places, in the second column of Exhibit B in the wording "Eight out of ten patients showed follicle rejuvenation after they had been treated." And, "Bio-Genesis works on four separate levels to rejuvenate the hair follicles."

h. Dr. Kai Setala, a Finnish medical scientist, endorses the use of Bio-Genesis to achieve the results identified in para- graphs a. through f. above.

The statement in the second paragraph of Ex. A that Setala and others have developed a formula for hair care and the correction of progressive baldness, which is marketed under the name Bio-Genesis, represents the endorsement of the product's claimed results by Dr. Setala. The representation is confirmed by Setala's photograph and additional data about the origin and efficacy of Bio-Genesis in Exhibit B.

__________

*Dihydrotestosterone

4. I do not interpret any of Respondent's promotional material as making the representation that "topically applied, BIO-GENESIS will cause structural changes in the skin elements" (Cplt. Par. III g.). I do not find in the record a definition of the term "structural changes." The term itself is not used in the promotional material. Complainant's dermatology expert, Dr. Earl J. Kramer, was unable to understand the term "structural changes" because of its vagueness (Tr. 326).

THE TESTIMONY OF DR. KRAMER

5. Complainant's medical expert witness, Dr. Karl J. Kramer, earned a medical degree from Johns Hopkins University and is board certified in both dermatology and internal medicine. In addition to extensive clinical work, Dr. Kramer's training included research work at the National Institutes of Health (Ex. U-1; Tr. 275-6).

In addition to his private dermatology practice in Miami, Florida, Dr. Kramer teaches at the University of Miami medical school and is the dermatology editor of the Journal of the Florida Medical Association. In order to keep current in his field, he regularly reviews the major dermatologic journals, attends weekly rounds at the University of Miami Dermatology Department including a research conference about every three weeks, and several months a year he is attending physician in the dermatological clinic at Jackson Memorial Hospital. He also attends monthly case pre sentations at meetings of the Miami Dermatological Society and one or two national dermatological meetings each year (Tr. 272-77).

In his introductory general testimony Dr. Kramer described the structure of hair, its growth cycle and its typical mosaic growth pattern as follows (Tr. 278-82):

Every hair follicle in humans goes through these stages. The first stage is referred to as anagen. During the anagen phase the hair follicle is growing and producing hair, and in humans this state lasts approximately four years although there is a lot of individual variation. After this period of anagen or growth, there is a period of degeneration in a particular hair follicle during which the hair is transformed into the resting state. The transition period is referred to as catagen ... and then finally, after the hair goes through this cycle or this stage, it comes into what we call the resting state, and the resting state is referred to as telogen. The resting state for the human scalp hair lasts approximately four months. After that four-month period, the hair follicle again begins to grow a new hair, and the old hair falls out, which means that in the human on any given day --human scalp hair --approximately 50 to 100 hairs will fall out during the course of the average day, and that is a perfectly normal number.

The accepted pattern of human hair growth is asynchronous or mosaic, meaning that the hairs on the scalp are randomly distributed between the growing and resting stages, as contrasted with the synchronous pattern shown in animals that shed or molt with all their hairs entering a particular growth stage at one time (Tr. 279-80).

Excessive hair loss is the loss of much more than the normal of 50 to 100 hairs per day, and the accepted definition of baldness is actual visible absence of hair on the scalp (Tr. 284). Among the causes of excessive hair loss is telogen effluvium, which is a condi- tion that may be created by any situation that can severely shock the human organism from its normally asynchronous hair follicle cycle to a synchronous one. Most of the hairs are shocked into the telogen or resting stage and, after the usual four-months' rest, will begin to grow again, forcing out the old hairs in the process. This condition may be the result of such traumas as childbirth, severe emotional stress, and the biopsies and hair transplants Dr. Kramer does regularly in his surgical practice.

...When I do surgery in the scalp, one injects a local anesthetic, one takes out whatever one wishes to take out... and, interestingly, when you do that, you shock the hair by the procedure itself and it is not unusual that three or four months afterwards the patient will say, "Hey, my hair is falling out where you did the surgery," and again, I can reassure the patient that it will grow back so that one seems to be able to produce a very localized telogen effluvium. (Tr. 285-386)

Dr. Kramer pointed out that it would be exceedingly rare in the United States population for a human nutritional deficiency to be manifested solely by hair symptoms. He could not recall ever seeing an isolated hair abnormality that was the result of a nutritional deficiency in the absence of some other, usually severe, disease process (Tr. 283-4, 448).

The most common kind of baldness is male pattern or androgenic baldness. It is a hereditary disease that may progress for 10 to 40 years. It requires a genetic predisposition plus circulating levels of androgens or male hormones (Tr. 287, 394, 49l). Adding "age" to these conditions adds very little because the required level of testosterone does not occur until puberty. One cannot with certainty predict male pattern baldness merely by looking before it occurs (Tr. 395). It may occur in women, usually after menopause, owing not to a change in level of testosterone but to a reduced level of estrogen (Tr. 398). He explained the mechanism as follows:

Both men and women have testosterone or other androgens, primarily testosterone, circulating in the blood stream. Certain genetically predetermined hair follicles are able to metabolize, or to change testosterone into a super male hormone, which is called dihydrotestosterone, or as I will refer to it as DHT. DHT, which is produced right in these hair follicles, seems to cause the eventual destruction of the hair follicle, and, to the best of our understanding, the hair follicles that are genetically predetermined to self-destruct are able to produce larger amounts of DHT and sic than the hair follicles which are never lost, even in bald men, and these are the hair follicles in the back of the scalp, or in the occipital region, are not able to produce this super male hormone. (Tr. 288-9)

Thus, castration before puberty will effectively prevent baldness, and castration during the course of balding will halt its progress. However, the latter will not result in reversal of the process or regrowth of any significant amount of hair (Tr. 287-8, 403).

While dandruff or excessive oilness was though 30 years ago to be a cause of baldness or excessive hair loss, that belief is not accepted today. Severe scalp conditions such as seborrheic dermatitis and psoriasis may rarely cause hair loss but that is reversible with treatment of the condition (Tr. 291-2).

Androgenic baldness is progressive but at rates that may be highly irregular over time in any individual. There may also be another kind of baldness superimposed on androgenic baldness in the same person. Telogen effluvium caused perhaps by a severe automobile accident may, after four months, appear to the person as if his androgenic baldness is accelerating rapidly. However, most of the hairs lost as a result of the telogen effluvium will return over the next few months (Tr. 289-290). Patients' self reports on the course of hair loss, although never wholly dismissed, are taken only with great caution and should not be relied upon. This is especially so when the condition observed is as irregular in progression as male-pattern baldness or as excessive hair loss (Tr. 290-291).

6. Respondent's evidence and argument do not contradict in any important respect Dr. Kramer's testimony concerning hair structure, growth cycle, and the essential causes of excessive hair loss and baldness. Respondent's evidence does dispute, however, Dr. Kramer's opinion that the accepted pattern of human hair growth is asynchronous, or mosaic. One of the studies introduced by Respondent concludes that in males hair growth is in principle, synchronized, and not, as though before, mosaic (CX-2, pp. 32, 33).

7. In Dr. Kramer's opinion, there is no treatment for male pattern baldness that is both safe and effective, an opinion supported by his search of the published medical literature. The texts he consulted all cautioned against relying upon animal studies that purport to show the efficacy of hair growing prepara tions in part because of the animal-specific response or nonresponse to such substances (Tr. 293-294).

8. Dr. Kramer identified the ingredients in Bio Prima Bio-Genesis as follows: Water is water; SD-40 alcohol a kind of alcohol commonly used in external preparations; Polysorbate 60 is a detergent or emulsifier and, in a sense, a cleansing agent. Urea is commonly used to denature or break down protein and, in some preparations, to increase penetration of another substance. Biotin, although not really a vitamin, will be called that. Niacin, is a vitamin. Glucosefructose is a kind of sugar. Tyrosine, cystine, lysine, methionine, serine, proline, and valine are amino acids. Lactic acid is probably used as a preservative in this preparation. Fragrance is fragrance. Dr. Kramer could not identify "Bio-concen trate (Germany)" (Tr. 303-304).

THE TESTIMONY OF DR. SCHWARTZ

9. Complainant's other expert witness was Dr. Sorrell Lee Schwartz, a professor of pharmacology at the medical and dental schools of Georgetown University, Washington, D.C. Dr. Schwartz is a member of the editorial board of the journal Toxicology and Applied Pharmacology. He has practical and teaching experience in the design and evaluation of drug studies (Tr. 68-72).

10. Dr. Schwartz described the pre-modern process of identify ing remedies as largely anecdotal (Tr. 73). It is only since the early 1960's that modern clinical pharmacological experiments have been an important part of the drug discovery process. The process begins with understanding and examining the physiological system to identify appropriate points of attack. There should be tests with cell cultures and with animals before proceeding to small, then larger-scale human trials (Tr. 74-76). Unless they are controlled by the design of the study, there are a number of variables in human trials that could affect results. The most important is the variation of the patient, and very important among patient variables is patient bias, also called patient expectation or the placebo effect. It identifies the effect of the experiment, or the patient's expectation of the effect, rather than a result caused by the treatment substance. It does not mean that "their pain is not relieved.... It just means that the drug didn't cause it." (Tr. 76, 77) Bias should be designed out of a drug study and can be in a number of ways including controlling the dosage of the treatment substance and its administration, and using the double blind technique where neither the patient nor the experimenter knows which patients receive the test substance and which the inert look-alike (Tr. 78-80). In pursuit of objectivity, subjective (patient) reports of hair growth in a study of baldness remedies, "an incredible number of patients" would be required (Tr. 81-82).

11. Dr. Schwartz was familiar with the ingredients listed on the label transcript of Bio-Genesis and with the advertising claims made for it (Tr. 84-85). His search of the published scientific and medical literature turned up no support for the proposition that any of the ingredients in Bio-Genesis, singly or in combination, will cause hair growth (Tr. 87). In his opinion, if a hair growth product were discovered, it would indeed be reported in the scientific literature and referenced in the usual citation services as well as the public process (Tr. 109-110). Dr. Schwartz was aware of some studies by Dr Kai Setala of a hair growth preparation. However, they are not listed in the retrievable literature or identified by the ordinary citation services (Tr. 87-88).

12. Two of Dr. Setala's papers were identified by Dr. Schwartz and received in evidence: "Safety and Mode of Effect of a Hair Preparation" (CX-3, Tr. 99) (hereinafter "1974 paper" or "Setala 1974 paper'); and "Effects of a Hair-Growth-Promoting Preparation: Clinical Trials based on Histo-quantitative Data" (CX-2, Tr. 88) (hereinafter "1978 paper" or "Setala l978 paper").

13. The l974 paper (CX-3) reported on experimental studies conducted since 1945 on 40,000 mice and clinical trials involving 320 adult volunteers, male and female. The portion of the paper relevant to the issues here relates to a clinical trial involving 173 males, aged 20 to 65 years, divided into two groups, Group I comprising 41 individuals, Group II comprising 132. The test substances used are said to be hair preparations consisting of aqueous solutions of certain synthetic detergents.

The subjects in Group 1 applied the hair preparation to the scalp once or twice a day, every day throughout test periods averaging 10 months. They were examined by a physician at approximately one month intervals, "the situation registered and the test area photographed." The Group II subjects "treated the scalp under uncontrolled conditions" for periods averaging 8 1/3 months. These subjects self-reported results, using a questionnaire.

The relevant results reported were as follows (CX-3, p. 30):

(a) The measures resulted in a stop, or a significant decrease, of excessive hair loss on an average within 2-4 weeks after the commencement of the topical treatment.

(b) About the same time the excessive hair loss was stopped a distinct regeneration of the growth became evident in about 60% of cases in both test groups.

The report stated that the clinical trials were very encouraging but that the test period was far too short (CX-3, pp. 23, 30).

14. The l978 report (CX-2) was the joint product of Dr. Setala, Dr. Schreck-Purola, Rolf E. A. Nordstrom, M.D., and Bjorn Lindroos, D.So. This study initially comprised more than 350 adult male volunteers. For a variety of reasons over 50% of these volunteers were excluded. After this preliminary screening, about 25o (sic) subjects remained. The series was further reduced when histological examination of the specimens revealed that the scalp biopsy was inadequate in any way. The final series comprised 167 subjects. The series was then divided into two groups. Group I included all 167 subjects and was intended for evaluation of the general mode of hair growth - whether mosaic or wave-like. The mode of progression of the excessive hair loss was determined partly on physical examination, and partly on the test subjects personal opinions. In Group II, 24 subjects were treated topically on the scalp with the Setala/Purola formulation, in which one of the most active ingredients is sorbimacrogal stearate 300, for a period of 9 months. The effect of the therapy was followed by means of serial biopsies in which the growth of the hair both outwards and also into the dermal interior was evaluated. The sum of the growth in both directions was regarded as the real hair growth. The l978 study included the patterned removal, at about three-month intervals, of biopsies from the scalp, slicing the biopsies into 5-micrometer sections, mounting every 5th section on microscopic slides and comparing the conditions therein revealed with other, but similar, biopsies taken after different intervals of treatment within the overall 9 months with the Setala/Purola products. (Ex. C-2, pp. 5-6) Some of the subjects did not appear for every biopsy procedure.

Among the conclusions reached in this experiment were the following:

A. In males, hair growth is in principle synchronized, and not mosaic as claimed before. (pp. 32, 33)

B. In assessing this A, above and related problems, it is imperative to examine numerous biopsy specimens simultaneously removed from several different scalp regions, and on several successive occasions. Examination of only 2, 3, or 9 scalp biopsies does not necessarily guarantee reliable results. (p. 33)

C. It is in principle possible to stimulate the growth of hair follicles. (p. 34)

D. When applied to the cutaneous surface, the preparation rapidly penetrates the epidermis proper and enters the area surrounding the hair follicles. A high rate of cell division is induced both in the epidermis and in the hair follicles. Because of the preparation's detergent effects remnants of keratin and dust particles are removed from the follicular mouths. Because if decreases the viscosity of intracellular fluids, it stimulates blood and lymph circulation. (pp. 34, 35)

E. The preparation removes any excess of cholesterol and other oily compounds from the cutaneous surface. (p. 35)

F. Earlier it was believed that the male sex hormones (androgens) are produced exclusively in the tests. Now, however, it is known that the human skin, with its sebaceous glands and hair follicles, is itself an important site for the biosynthesis of androgens. Thus, cholesterol - when synthesized in the human skin - is metabolized in situs in the scalp to androgens; consequently if androgens are responsible for MPB (sometimes even termed "androgenous baldness"), the cholesterol formed in the skin must also be responsible for the condition. (p. 35)

G. In part II of the study the behaviour of hair growth was followed during a period of 9 months while the 24 test subjects treated the balding/ bald area of the scalp topically with the hair preparation. It appeared that in 89% of the 13 statistically representative cases, hair follicle growth in the treated area increased. Although the absolute number of hair follicles within the fully haired occipital area was naturally higher, the air follicles within the treated balding/ bald areas of the scalp showed clear signs of growth. (p. 40)

15. The 1978 paper purports to describe the hair growth stimu lating effects of a remedy on which a Finnish patent was issued (Tr. 89). Dr. Schwartz said that he could not identify structurally the ingredient sorbimacrogal stearate 300, but believed it was probably a detergent-like material (surfactant) (Tr. 90). Dr. Schwartz's critical assessment of the paper was that it was "not by any means" a controlled clinical study, and that he would reject it for publication in a journal (Tr. 90-91). The question asked in the study, will this material apparently increase hair growth, is too diffuse to meet the standards of a controlled clinical study. He also noted that many preconceived notions throughout the paper. For example, the paper stated the need for special statistical techniques but gave no reason and, apparently used no such special techniques (Tr. 91). The theory of the paper, namely the effect of cholesterol on membranes and the assumption that removing it will stimulate hair growth, is in Dr. Schwartz's view unsound (Tr. 95, l02). Evidence of conscious bias by the investigator is shown by references throughout the paper to the expected result. From a scientific point of view, the paper is "silly" (Tr. 95-96).

Dr. Schwartz commented on the authors' reliance on analysis of biopsies: an investigator who uses this or any other new technique must first demonstrate its validity, that is its ability to measure or identify what it claims, to the "end point." Nothing in the l978 paper shows the validity of the end point claimed for the biopsy examination technique (Tr. 92). Also in that paper, concurrent controls were "pretty much non-existent" as to selection of subjects, administration of the treatment substance and the use of a of a placebo (Tr. 91-93). Dr. Schwartz pointed out that a control group does not mean an untreated group, but rather a group treated identically except for receiving the active ingredients in the test substance (Tr. 94). The study's lack of effort to avoid the placebo effect, in Dr. Schwartz's view, invalidates, or at least calls into serious question, the results (Tr. 96).

The 1974 Setala study also fails to meet the test for a valid clinical study and would not be accepted for publication according to Dr. Schwartz (Tr. 99-101). In it the investigators reach the conclusion, among others, that topical treatment of the scalp with the Setala preparation inhibits excessive hair loss and stimulates regrowth of hair (CX-3, p. 23). Dr. Schwartz stated that the report of the study "absolutely" does not support those conclusions (Tr. 101). He found no evidence in the study or in his search of the literature that Bio-Genesis will prevent balding, cause new hair growth or regenerate hair follicles (Tr. 105). He said finally that his testimony on the design and evaluation of clinical trials and on both the 1974 and 1978 papers reflected the mainstream of scientific thought (Tr. 104).

16. Dr. Schwartz stated that in science, a lack of information to support a claim of efficacy makes that claim false (Tr. 142). The current standard for determining efficacy is a controlled clinical trial and, absent such a trial, claims of efficacy must be considered untrue (Tr. 182-183). This view is consistent with the mainstream of current scientific thought (Tr. 183-184).

THE TESTIMONY O DR. SCHRECK-PUROLA

17. Respondent called as an expert witness Dr. Ilona Schreck Purola of Espoo, Finland, a doctor of medicine and surgery, licensed in Finland. She is assistant pathologist in the 1st Department of Pathology, University of Helsinki. She has worked in the field of dermatology 1 1/2 years, caring for patients with scalp and hair diseases. She has worked in a hair treatment center and has studied "every possible available book" relating to hair treatment. Dr. Purola has lectured at conferences on hair and scalp research (Tr. 507-509).

18. Dr. Purola participated in the studies referred to as the 1974 and 1978 Setala studies (CX-2, 3), on which Respondent largely rests the contentions stated in its brief that Bio-Genesis is an effective treatment for excessive hair loss and will cause new hair growth.

19. Dr. Purola testified that the ingredients of Bio-Genesis are identical to those used in the Finnish studies. She was not certain, however, that the substances were identical in the quantity of each of the ingredients( Tr. 352). She testified that Polysorbate 60, applied topically to the scalp, increases the mitotic (cell division) activity in the epidermis (top layer of skin) Tr. 552, 553). Dr. Kramer had identified Polysorbate 50 as an emulsifier (Tr. 304). Dr. Purola said she could not identify any of the ingredients as an emulsifier (Tr. 553). She stated that Bio Concentrate (Germany) is a vitamin mix but did not identify its vitamin components. She testified that Biotin is vitamin H, that it is very necessary to the growth of hair and that upon application of the scalp it enters the cells of the hair in the skin (Tr. 556). Dr. Purola stated that her opinion as to the mitotic activity of Polysorbate 60 is supported by studies that she and Dr. Setala have made on animals and that studies made by Dr. Setala on mice, in connection with skin cancer, support her opinion that topically applied biotin enters the epidermal cells (Tr. 557, 558).

20. According to Dr. Purola, the 1974 Setala study, insofar as it involved humans, began with the selection of 173 volunteers. These men were examined to determine whether they had early baldness and a history of baldness in the family. The effect of a hair preparation called Bioscal (same ingredients as Bio-Genesis, Tr. 518) was to be determined by its effect on (a) dandruff, (b) hair loss and (c) possible increase of the growing of hair. The volunteers reported their views as to whether they had more or less hair and they also reported their own observations as to whether they had more or less dandruff on their scalp, neck and shoulders on those days when they had not shampooed their hair. About once a month it was a laboratory assistant or the doctor who made the observations. Every person recorded his own observations on a card which he maintained and kept in his possession. Several photo graphs were taken of 41 of the subjects. The same photographer took all the pictures, but he did not use the same camera each time. The preparation used on the volunteers was comprised of the same ingredients as those used in Bio-Genesis. The volunteers were instructed to use the preparation "once or twice a day." (Tr. 513-519).

The 41 subjects who were photographed came to the doctor's office "regularly every two or three months." There was not enough money available to include all the volunteers in the study, so each of the other 132 relied on the notes which he himself made of his own condition. Each counted the hairs on his pillow the first thing in the morning, on his comb when he combed his hair during the day, and in the wash basin when he washed his hair. He estimated the number of hairs lost, and a loss of over 120 in a 24-hour period would be excessive. The volunteers kept records at first on a daily basis, later on a weekly basis, and when the excessive hair loss diminished, they stopped counting (Tr. 519-521).

The 41 volunteers who came to the pathology department on a monthly basis in the l974 study were men whose baldness was diagnosed by Dr. Purola as MPB. Dr. Purola made a mark of about one square centimeter on a plastic hood worn by the volunteer, and she then made an estimation of the number of hairs in that particular area at the time of each visit. Based on (a) records kept by the patients and reported to the doctors, (2) Dr. Purola's personal observations and (3) photographs appearing on page 25 of CX-3, Dr. Purola stated that in a 6-weeks period in May-April 1974, there was short, new hair on the subject of those photographs and she said, also, that there appear some longer hairs in the anagen stage (Tr. 521-524). Similar testimony was elicited in regard to photographs appearing on pages 26 and 27 of RX-7 (Tr. 525-528). According to Dr. Purola, she and Dr. Setala concluded as a result of the l974 study that the product is safe, that it is possible to provoke new hair growth, and that the loss of hair diminished (Tr. 524, 429, 532).

21. Another test, employed in the 1974 study, involved biopsies taken at three four-month periods. Dr. Purola said that "all these eight cases in which biopsies were compared showed definite regrowth of hair follicle activity (Tr. 534-535).

22. Dr. Purola stated that there was no control group used in the l974 study because it is a known fact throughout the medical world thus far that there is no substance that can have any effect on the progressive nature of MPB (Tr. 544). The volunteers were told that the product presented a possibility of increasing the growth of hair, that it might lessen the loss of hair and that it would alleviate a dandruff condition. There is no way o knowing with certainty that the patients kept accurate records (Tr. 545). Dr. Purola stated that the l974 test was not scientifically adequate (Tr. 561).

23. Despite the fact that Dr. Purola acknowledged that it is widely recognized that MPB is irreversible and can not be cured, she, nevertheless, stated that it is here unqualified opinion, based on the studies she described in her testimony, that the use of Bio Genesis would either cure or reverse the progress of that condition, and she stated that she had discussed the subject with the head of the Dermatological Department at Helsinki University (Tr. 560).

After making the foregoing statement, however, she said that Bio Genesis would not "completely" or "absolutely" cure the condition; it will stop it; in certain cases, regrowth of new hair has been proved; if used early in baldness or on a young person, "it may help." (Tr. 561, 563, 566) Dr. Purola cited particularly a young man of twenty whom she treated, in "her personal opinion" effec tively, with the Setala formula (Tr. 564-65). Although she did not identify the proof of regrowth of hair, she indicated that the l978 study "gives further evidence" of it (Tr. 562).

24. Dr. Purola said that her opinion of the efficacy of the preparation was not generally shared by other physicians and dermatologists, the sole partial exception being Germany where "social medi-care" in some cases pays for the treatment (Tr. 568-69).

25. The Bioscal Company in Germany, to which Drs. Purola and Setala sold the patent on the product, acquired the right to use their names in conjunction with the results of their studies (Tr. 535, 536).

THE TESTIMONY OF DR. NORDSTROM

26. Respondent called as another expert witness Dr. Rolf Nordstrom, a medical doctor from Finland engaged in a private practice involving principally different types of surgery for hair problems (Tr. 571, 572, 577, 578). Dr. Nordstrom has written numerous papers relating to the hair and scalp, some of which have been published in American medical journals (Tr. 571-574). He participated in the l978 Setala study.

27. Dr. Nordstorm's testimony agreed with Dr. Kramer's testimony that hereditary baldness is the product of genetics, normal levels of testosterone, and age sufficient to produce the necessary hormones. The condition is irreversible as indicated by the balding man's failure to regrow hair after castration (Tr. 582, 582).

28. Dr. Nordstrom's testimony covered principally the design and conduct of the 1978 study of the Setala preparation (Tr. 681), for which Dr. Setala had asked him to locate subjects (called "volunteers" by the witness) and to do the biopsies (Tr. 585, 594). He said that he selected twenty-four of his patients with male pattern baldness too advanced for "hair reconstructive surgery" as a sufficient number to be treated with the test substance (Tr. 586, 624-25). Eleven of the 24 subjects were dropped from the study due to problems with motivation, local adverse effect of the biopsy procedure, or lack of uniformity in the procedure (Tr. 626). The volunteers were told that the test substance might influence hair growth in a positive way after some months or years, if any results at all would appear (Tr. 635). They were instructed to use the preparation once or twice a day, a variance that Dr. Nordstrom agreed might affect the results (Tr. 636).

29. Dr. Nordstrom described the biopsy procedure and indicated the location of serially done biopsies on RX-17 (Tr. 595-95). The distance between the first and second biopsy was about 4 cm; between the second and third, about 3 cm; and between the third and fourth, about 2 cm. The time intervals between biopsies were three months, three months, and six to nine months, respectively (Tr. 616). It was intended to repeat the procedure and to record the data at the taking of each biopsy, but this was not always done (Tr. 608). Although the design called for 3 biopsies to be taken on 4 separate occasions from each of the 24 volunteers, or a total of 288 biopsies, only 123 biopsies were actually reported as taken. (1978 study, p. 11, § 1; Tr. 628) Even for the 13 tests subjects remaining in the study, some biopsies were omitted. Only 9 to 10 (or 75% to 80%) were taken from each (Tr. 628-29).

30. Dr. Nordstrom said that it is his opinion that Bio-Genesis has an effect in that it reverses MPB to some extent (Tr. 620). There is no study, so far as he is aware, that shows a positive effect on MPB with any product, but he said that the information derived from this study shows a very high probability of a positive result with this product (Tr. 650). He knows of no other study in which the biopsy technique has been used to measure hair growth, but some parts of the technique have been used in other types of studies that have been published. His agreement with the conclusions reached in the l978 study are based on his clinical judgment and not on the analysis of the biopsies (Tr. 633-640). He has seen no complete cure of MPB which he can attribute to the Setala/Purola product and he does not use that product in treating any of his patients. To have achieved more impressive results, the study should have continued much longer (Tr. 642-646).

31. If the 1974 or 1978 study had been published in a recognized medical journal or listed in Index Medicus, Dr. Nordstrom would know of it. Neither study has been so published or accepted for publication or listed (Tr. 636-637). If a product should be formulated which would bring about he reversal or the arrest of MPB, it would be so popular in the medical field that journals would ask to be permitted to publish the report of such a finding (Tr. 648).

THE TESTIMONY OF DR. GOLLNICK

32. The third expert witness called by Respondent was Dr. Norbert Gollnick of Zantkup, Oldenburg, West Germany, a medical doctor specializing in dermatology, allergies, and venereal diseases (Tr. 652-655).

33. Dr. Gollnick said that he has treated over 300 cases of alopecia androgenetica, which is the term used in Germany for MPB. This experience has included the use of Bioscalin with 38 patients (Tr. 656-657, 680). When a new patient comes to him for treatment of hair loss or baldness, he does a complete medical history, followed by a complete physical examination. He does a blood test in which he checks for cholesterol and the entire fat content of the blood. He asks about the patient's dietary habits, the cosmetics used and he ten examines for infections in the body (Tr. 657-661).

34. Dr. Gollnick learned of Bioscalin in l976 and when he then began to use it he had a success rate of about 55 percent. Later, taking aspects of nutrition into account he achieved an approximate 80 percent success rate (Tr. 661-663). His measure of "success rate" involves looking at the patient and seeing how the hair grows, its composition, how it feels, whether it is shiny, and a primary determinant is the reaction and comment of the patient (Tr. 676, 727-728).

35. Dr. Gollnick gave brief summaries of 8 of his patients he treated for baldness. In connection with his narration of the treatment of these patients, he mentioned the fact that they suffered with various illness, for example: Arens-hypertension; Bocker-tonsillitis and dental problems; Eilers - gall bladder problems, weakness of circulation, allergy to pollen, and presumably, tonsillitis, since the tonsils were removed during the course of the treatment; Lippisch - Dr. Gollnick had Lippisch's tonsils removed, "But x-ray pictures showed that he had a dental problem." (Tr. 674-680)

36. Dr. Gollnick stated that if a person has a hair problem or a disease, one must determine the focus of the infection or other malaise within his body first and diagnose this; and there is a large number of such inhibiting factors." (Tr. 662) He said, also: "We must recognize that a medicine can not *** help by itself, but that all other impediments have to be eliminated." (Tr. 660) When Dr. Gollnick was asked whether the total of 38 cases, including those summarized, represented his experience with Bioscalin in MPB cases, he answered, "Yes. Using, in addition, my own methods." (Tr. 680)

37. Dr. Gollnick has not used double-blind tests for the past four or five years. He said that he has used no control group because his vest experience makes it unnecessary for him to do so. Because of this experience he knows how to administer these tests. In any event, he said, a control group would be required only for internally administered drugs - not externally, or topically, administered drugs. He declined to state or define the pharmacological activity of Bioscalin (Tr. 724-727).

THE TESTIMONY OF MESSRS. MORRISON, MESSINA AND RUCCIO

38. Respondent also introduced the testimony of lay witnesses who testified with respect to personal experience with Bio-Genesis and its effectiveness. The witnesses and their statements are summarized as follows:

(a) Peter Morrison found that the use of the product caused a substantial decrease in hair loss (Tr. 689), and also discovered the growth of new hair which he had not seen before in an area in which he had not recognized earlier hair growth. (Tr. 689-690) Mr. Morrison also attributed a substantially thicker growth of hair to BioGenesis. (Tr. 690)

(b) Victor Messina testified, that after using several bottles of Bio-Genesis, he found that his amount of hair loss was diminished. (Tr. 695) After 6 months' experience with Bio-Genesis, Mr. Messina noticed a marked difference in hair fall, and, in addition, noticed new hair growing on his scalp. (Tr. 695) The newly grown hair is now covering the crown of his head and the rear center portion of the scalp. (Tr. 696) In Mr. Messina's experience, no other product produced the results which he obtained from Bio-Genesis. (Tr. 697)

(c) Dante Ruccio testified that he has been diagnosed as suffering from "male pattern baldness - alopecia areata ***." (Tr. 701) Mr. Ruccio, at the time of the hearing, had used Bio-Genesis for about thirteen months. (Tr.703) Prior to that time, he had used a number of remedies in attempts to cure his baldness. However, he had no success with any other product. On the other hand, Mr. Ruccio has found Bio-Genesis to be effective and he is starting to get his hair back. (Tr. 704-706) Dr. Kramer's Testimony Concerning the

1974 and 1978 Setala Studies

39. According to Dr. Kramer only a small part of the l974 study (CX-3) dealt with the results of trials of what he called this "hair-growing or whatever" preparation in humans. One problem was that it was an uncontrolled study, the results of which were determined by questionnaires which the patients themselves filled out. There was a smaller number of patients who allegedly were more carefully observed by the physicians in charge of the study. He said, however, that "by no stretch of the imagination" cold the human studies for the hair-growing preparation "have any claim to being a valid scientific study." (Tr. 304-307)

40. Dr. Kramer described a valid scientific study as being one that is a double-blind controlled study in which the objective is defined, the participants must be chosen, they must be controlled, and in the case of a test of a product claimed to grow hair, the two groups - test and control - must be comparable in the degree of baldness, age and other characteristics. The preparations given to each of the two groups would have to look alike, and neither the physician administering the preparation or the patients themselves would be able to determine which group is getting the "active preparation" and which is getting the inactive or placebo prepa ration. Next, it must be decided how one is going to evaluate whether or not something rows hair. The end point of that hair preparation has to be that it grows hair and it does not matter what a biopsy shows or what one sees under the scalp if it does not grow visible, long hair on the scalp because that is really what is sought to be learned. Finally, one would have to do a scienti fically valid statistical evaluation of the results. It is very important in a good scientific paper that anyone reading it is able to go through it and determine what the experimenters did and what they were trying to do (Tr. 307-311).

41. With respect to the 1978 Setala/Purola study (CX-2) Dr. Kramer stated that the only part of this study relevant to the issues here consists of a group of 24 patients who were treated with this particular preparation over a nine-month or 12-month period of time. All the other information in this study, including, among other items, that related to the 167 patients, bears no relationship to efficacy studies of this particular preparation. Dr. Kramer stated that they way the information concerning those 24 patients was handled would absolutely invalidate any conclusions whatsoever that could possibly be drawn as to the efficacy of this particular preparation for a very simple reason. They treated this group of 24 patients over a period of between nine and twelve months. Then, contrary to any valid scientific technique, they eliminated 11 of those 24 patients. Their excuse for such elimination was that the statistical data were not enough, or were inadequate. Dr. Kramer said that on one who would evaluate a drug study could possibly eliminate essentially half of the patients he tested and draw any valid conclusions from the other half of the patients. This is a crucially important point. In this study the decrease in the number of participants was from 350 to 250, to 167, to 24 (who were actually treated with the product), to only 13 who are reported in the results. According to Dr. Kramer, this study does "absolutely not" represent any valid scientific evidence in support of the proposition that the products in question will grow hair on the scalps of bald men (Tr. 311-313).

42. Other serious deficiencies in the 1978 study found by Dr. Kramer include (a) the use of multiple scalp biopsies as an attempt to provide a quantitative measure of human hair growth, when there has been no validation of the procedures; (b) the "discovery" that hair growth is synchronous rather than mosaic most probably results from the methods used because the multiple biopsies taken at three-month intervals shocked all the hairs in the affected locations into the resting stage, as described in Dr. Kramer's earlier testimony dealing with telogen effluvium; and (c) the results reported in CX-2 cast a great deal of doubt on the method the experimenters used, and if the method used is not good, then one can not attribute scientific validity to the result (Tr. 313-316).

43. Finally, Dr. Kramer referred to page 35 of CX-2 where the authors speak of cholesterol synthesizing, or being synthesized into, testosterone. The authors of the report cite a number of references in notes 40-49, several of which were written by persons known to Dr. Kramer as being associated with the Department of Dermatology at the University of Miami. All of those references are directed to the idea that testosterone is metabolized in the scalp. Testosterone is changed to dihydrotestosterone in the scalp but nowhere in those references is there any evidence, nor is the statement made, that cholestrol is directly changed into any androgenic hormone in the scalp. This is the basis for this entire study, said Dr. Kramer, and it is fallacious. Hence, removing cholesterol from the scalp can have no effect on testosterone (Tr. 317-318). Further deficiencies in the 1978 study said by Dr. Kramer to impair its validity as a scientific study are as follows (Tr. 318-320):

(1) Case No. 113 is shown to be 20 years old and age 20 is also shown to be the age at which he started to lose hair. In the next column it is indicated that the patient had been losing hair for 19 of his 20 years before he noticed he was becoming bald. The next column shows him to be a Type VI, which means that he is really quite bald. The figure in the next column shows the 20 year old subject to have been losing hair for 24 years.

(2) Case No. 112 is a patient who is age 20. The age at the onset of hair loss is age 18. On the other hand, it says that the duration of hair loss before involution of male-pattern baldness is 18 years, so he has been losing hair for 18 years, and the duration of hair loss before the first biopsy was 20 years. Here there is a 20-year-old man, and it is claimed that he has been losing hair for the first 20 years of his life.

44. Dr. Kramer stated that the 1974 and 1978 studies did not prove that the test product does not work. He said that neither of the studies contains any evidence to prove or support the claim that the product will grow hair. The standard to be applied to establish the efficacy of a treatment agent such as a drug is that the drug must be both safe and effective, and the method by which these factors are established is by controlled, repetitive, reconfirmed studies of the type previously described by Dr. Kramer. The 1974/1978 Setala/Schreck-Purola studies do not provide a basis for any conclusions in respect to the efficacy of Bio-Genesis (Tr. 323-325).

45. Based on his research and on discussions with respected members on his profession, it was Dr. Kramer's opinion that Bio Genesis will not produce the results indicated in the representa tions made by Respondent in its advertisements related to these products with the exceptions that (a) they might remove cholesterol from the hair, but they would not neutralize the cholesterol, and (b) insofar as there is concerned the representation that the pro duct "will cause structural changes in the skin elements" it is so vague as to make it uncertain what is meant, but it is possible that the scalp might become irritated. If so, it might be said in that sense to cause a structural change in the skin (Tr. 325-326).

Rebuttal Testimony o Dr. Kramer

46. Dr. Kramer was recalled to the stand as a rebuttal witness. The topics concerning which he was examined and his testimony thereon, insofar as relevant to this proceeding, are shown below:

a. Dr. Gollnick had testified that he based some of his treatment decisions and scientific conclusions on his vast experience. While experience is valuable, evaluation of a particular treatment or the effectiveness of a therapy or a drug on that basis is inferior to modern methods of measuring efficacy (Tr. 853-854).

b. The importance of inhibiting factors such as tonsillitis or dental problems as contributing to MPB represents a theory of medicine called the focus of infection theory which has been largely discarded. It is not listed in the scientific literature as being applicable to MPB, and Dr. Kramer did not encounter it in his discussions with his colleagues or in his training (Tr. 854-855).

c. Self-reporting by patients on treatment and their beneficial results are listened to and if something of interest is presented it may be noted for further investigation, but in most cases the results so reported are brought about by the desire of the patients for positive results (Tr. 858-859).

d. Reports by patients as to their daily hair loss can not be dismissed, but they must be taken with a grain of salt (Tr. 860).

e. If, as reported by one witness, a person shampoos his hair daily he is going to see fewer hairs on the shower or tub floor than if he shampoos three times a week (Tr. 860).

f. One of the witnesses reported new hair growth after using Bio-Genesis for a period of time. This event could be attributed to the use of the product or it could be attributed to the stimulation of the scalp by the act of rubbing the preparation on the scalp. This phenomenon is reported in a recognized leading text book written by Montagna (Tr. 861).

Inspector Powers' Interview of Dr. Setala
and Dr. Schreck-Purola

47. In June 1980, Postal Inspector William F. Powers inter- viewed Dr. Setala and Dr. Schreck-Purola in Finland with regard to the product Bio-Genesis. According to Inspector Powers' testimony, both doctors appeared for the interview voluntarily and both were fluent in English. They told him that in the early 1970's they had conducted research with a formula essentially identical to Bio-Genesis and determined that it promoted hair growth (Tr. 210 214). They emphatically stated that it had no effect on male pattern baldness (Tr. 210). Dr. Schreck-Purola told Inspector Powers that MPB was quite easily distinguishable from excessive hair loss and that their product would in some cases decrease the excess rate of loss in the latter condition (Tr. 211). The doctors did not know whether the reports of these studies had been published in any medical or scientific journal (Tr. 211, 212).

48. The doctors advised Inspector Powers that they had sold the marketing rights to their product, reserving the right to review all advertisements prior to marketing for content and correctness. They further said that they had not been requested to review any advertisements for the product. Inspector Powers showed the doctors several of Respondent's advertisements for Bio-Genesis. Following their review of these advertisements they both stated that their discovery was being marketed in the United States with misleading advertisements. They said repeatedly that their formula was not a cure for baldness and would have no effect on dead hair follicles or male pattern baldness. (Tr. 215-226).

49. Dr. Setala and Dr. Schreck-Purola would not make state ments under oath or written statements for Inspector Powers saying that time would not permit. Dr. Setala, however, said that he would like to prepare at a later date a written statement concerning some of Respondent's ads (Tr. 226, 227). He did so in the form of a letter to Inspector Powers dated July 16, l980 (CX-14) which, in pertinent part, (1) underscored the fact that Drs. Setala and Schreck-Purola did not ever claim in their scientific writings to treat "bald" people or to "cure baldness"; (b) stated that the "open letter fro Professor Kai Setala, MD. and Ilona Schreck-Purola, M.D." which appeared in Body Forum (p. 4 of CX-10) is false in that the doctors neither wrote nor authorized the writing of the letter; stated that the claim interview of Dr. Setala by Louis Rinaldi, which appeared in Body Forum (CX-9, pp. 3-5) is false in that Dr. Setala does not know a Louis Rinaldi. Finally, in his letter Dr.

Setala specifically denied the report in CX-8, that either he or Dr. Purola has ever written that they have, or that either of them has, developed a cure for baldness that is "effective in restoring hair in 80% of all patients treated."

50. In her testimony at the hearing Dr. Schreck-Purola did not dispute Inspector Powers' testimony or notes concerning the substance of the interview in Helsinki in June 1980.

Evaluation of Medical Testimony

A finding of falsity in this type of proceeding may be based on the testimony of expert witnesses whose testimony is said by them to be in accord with the consensus of informed medical or scientific opinion when such testimony is not overcome by a preponderance of contradictory reliable and probative evidence. Standard Research Labs, P.S. Docket Nos. 9/63 & 9/64 (P.S. Dec. 8/31/81); Great Life Laboratories, Inc., P.S. Docket No. 8/82 (I.D. 2/5/81).

The stipulated expert testimony of Complainant in this case refuting Respondent's representations as to the efficacy of Bio Genesis is in the mainstream of medical and scientific testimony. This was conceded by Respondent's witnesses, Dr. Schreck-Purola and Dr. Nordstrom. Therefore, unless the evidence concerning the Setala-Purola studies of l974 and l978, and the opinions of Respondent's experts based thereon, persuasively controverts such consensus, Complainant must prevail.

Too much doubt has been cast on the scientific validity of those studies to accord them persuasive weight as against the contradic tory consensus. The main factors which create that doubt are as follows:

a. Lack of adequately controlled clinical trials.

b. Elimination of 11 of the 24 original subjects from the data derived in the l978 study.

c. Failure to eliminate possible subject and doctor bias by use of double blind technique.

d. Unreliability of self-reporting by patients.

e. The unproven validity of the histoquantitative (biopsy) method applied in the l978 study.

f. Lack of support for the theory that cholesterol in the scalp is synthesized to androgens.

g. Dr. Schreck-Purola's acknowledgment that the 1974 study was only preliminary and was not scientifically adequate.

h. Lack of publication of the report of either study in recognized medical or scientific journals.

Respondent's Legal Arguments

1. Admissibility of Memorandum of Interview with Drs. Setala and Schreck-Purola (CX-12).

Respondent argues strenuously the presiding officer should not have received in evidence the memorandum of Inspector Powers con cerning his June 16, l980 interview of Drs. Setala and Schreck-Purola and the testimony of Inspector Powers about such interview. The objection is that the memorandum (CX-12) and the testimony are inadmissible hearsay.

At the hearing CX-12 was received under the hearsay exception set forth in paragraph 8(B) of Rule 803, Federal Rules of Evidence. I am not persuaded by Respondent's argument to change that ruling.

Moreover, Respondent called Dr. Schreck-Purola as a witness following the admission of CX-12 and Inspector Powers' testimony. She did not dispute them in any important respect.

2. The Lack of Subpoena Power and Right of Cross-Examination.

Respondent argues that the lack of statutory authority in the Postal Service to subpoena witnesses in a § 3005 proceeding denies Respondent procedural due process. Section 3005 has come under repeated constitutional attack, including lack of due process, and has been upheld invariably.

Respondent's argument is focused on the hearsay evidence received concerning Dr. Setala's statements (see supra), complaining that lack of subpoena power prevented Respondent from cross-examining Dr. Setala as to such statements. But as Judge Duvall pointed out in his decision in Cosvetic Laboratories, et al., P.S. Docket No 8/160, et al., Respondent did not ask for, and displayed no interest in having, additional witnesses produced by Complainant. Respondent brought two witnesses from Finland and one from Germany. With his consent, presumably Dr. Setala could have been present to testify for Respondent. As mentioned above, Dr. Purola, one of the participants in the Helsinki interview, testified for Respondent and did not dispute Inspector Powers' version thereof. Under the circumstances I do not discern any prejudice to Respondent's case due to lack of subpoena power.

3. The Standard of Proof.

Respondent urges that Complainant has not met its burden of proving its case by a preponderance of the evidence. It says that Complainant should not be allowed to make its case on the basis of the informed medical and scientific consensus but, rather, should be required to do so with evidence of "exhausitive scientific inquiry," presumably scientific testing such as required of respondents in cases of this nature. Respondent complains that permitting Complain ant to make a prima facie case on the basis of such a consensus unfairly shifts the burden of proof to Respondent.

Respondent's argument confuses two related, but different burdens, i.e., (a) the burden of proof as to the issues of the making of representation and of the falsity thereof, which is always on Complainant, and (b) the burden of going forward with the evidence which may shift as the case progresses. There is nothing unique about § 3005 cases as to either burden. But it has been held in a number of cases that Complainant's expert witnesses are not required to test the product, or produce evidence of testing, to sustain Complainant's burden on the falsity issue. See, for example, Reilly v. Pinkus, 338 U.S. 269, 274 (1949); Original Cosmetics Products v. Strachan, 459 F. Supp. 496 (S.D.N.Y. l978), aff'd 603 F.2d 214 (2nd Cir., l979), cert. den. 444 U.S. 915 (l979). It has also been held on numerous occasions that a finding of falsity may be based on the testimony and opinions of expert witnesses which is in accord with the informed medical or scientific consensus when there is no con tradictory evidence said to be in accord with a contrary consensus.

Athena Products, Ltd., P.S. Docket No. 7/99 (P.S. Dec. 6/26/81); Standard Research Labs, P.S. Docket Nos. 9/63 and 9/64 (P.S. Dec. 8/31/81); Modern Age Products, Inc, P.S. Docket No. 5/102 (P.S. Dec. 6/29/77).

Once Complainant establishes a prima facie case with testimony in accordance with such a consensus, the burden of going forward with evidence to overcome that case is on Respondent.

Thus, there is nothing unique to § 3005 cases about the burden of proof and the shifting burden of proceeding. They are common to virtually all litigation.

4. Materiality of Respondent's Advertising Claims.

Respondent argues that because Complainant introduced no evidence from consumers showing what, if any, influence Respondent's advertis ing had on decisions to purchase Bio-Genesis, Complainant has not sustained its burden of proving the materiality of the representations alleged to be made by Respondent.

It has been held that the impression of advertising on the ordi nary mind is a question of law for the presiding officer to determine. Testimony as to interpretation is not required to make that determination. Vibra-Brush v. Schaffer, 152 F. Supp. 461 (S.D.N.Y. l957). Once a representation is found by the presiding officer, it is also left to him to determine its materiality without testimonial evidence. Ordinarily, the nature of the representations alleged and established is directed at the hopes for a remedy universally and eagerly shared by the bald and balding. This was made abundantly clear in the testimony of Respondent's three lay witnesses who purchased the product hoping for the remedy or cure promised in Respondent's advertising.

CONCLUSIONS OF LAW

1. Respondent using the name and address set forth in the caption of this proceeding, solicits remittances of money through the mails for its product, Bio-Genesis.

2. The meaning of advertising representations is to be judged from a consideration of an advertisement in its totality and the impression it would most probably create in ordinary minds. Donaldson v. Read Magazine, 333 U.S. 178 (l948); Vibra-Brush, supra; Borg-Johnson Electronics v. Christenberry, 169 F. Supp. 746 (S.D.N.Y. 1959). Express representations are not required. It is the net impression which the advertisement is likely to make upon purchasers to whom it is directed which is important, and even if an advertise ment is so worded as not to make an express representation, if it is artfully designed to mislead those responding to it the mail fraud statutes are applicable. G. J. Howard v. Cassidy, 162 F. Supp. 568. See, also, Virginia State Board of Pharmacy v. Virginia Citizens Council, 425 U.S. 748 (l976).

3. Applying the foregoing standards, I find that Respondent in its advertisements makes the representations alleged in the Complaint, with the exception of that alleged in paragraph III g. of the Complaint.

4. Based on the testimony of Complainant's expert witnesses, Dr. Kramer and Dr. Schwartz, conforming to be informed medical and scientific consensus, I find that such representations are false.

The materiality of the representations is too obvious to require further discussion.

5. Complainant has established its case by a preponderance of the competent, credible and probative evidence.

6. Respondent is in violation of 39 U.S.C. § 3005. Accordingly, an order in the form attached should be issued against Respondents.