Elena Medo, who has established multiple breast milk-making startups, including this one in Boulder City, poses for a photo in a class 100,000 clean room where blending, formulation and filling of Medolac human breast milk pouches happens Thursday, July 25, 2024.
Sunday, July 28, 2024 | 2 a.m.
Elena Medo will never forget the first time she stepped into a neonatal intensive care unit roughly 40 years ago.
Medo, now 71, had just given birth to her son and was asked if she’d be willing to donate some of her breast milk because a preterm baby in the same hospital was dying and there was no other donor milk available, she said.
The premature infant, who weighed under 1 pound and had a head “the size of a jumbo egg,” died before Medo’s blood work was cleared to make the donation, she said.
The incident influenced Medo to start a few different companies to address the shortage of donor breast milk, including the recently liquidated Medolac in Boulder City.
The business was forced to close and sell off its equipment because of the financial hardships it endured from legal fees of multiple lawsuits with a rival company.
Prolacta Bioscience, the California breast milk product company she founded in 1999 and left 10 years later, filed lawsuits in 2015 against Medo for using trade secrets to form a competing company.
Eight charges were dismissed in an Orange County, Calif., court, but the disparaging comments about Medo caused significant damages, she said in a 2020 countersuit alleging defamation.
A contract with a national hospital operator that was worth millions was scuttled because of the allegation, she said.
The 2015 claims, she says, were Prolacta’s way of burying the competition with costly-to-defend litigation that continues to this day. Meanwhile, Medolac is shuttered; its equipment will be auctioned Friday.
“I can say unequivocally, I never took any trade secrets,” Medo said. “I remain committed to trying to help these babies, because it just weighs so heavily on me that every day babies are dying, every single day they’re dying of preventable death.”
Business history
Medo began her dive into the industry in October 1986 when she started White River Concepts, which sold medical devices like breast pumps to maternity units in hospitals.
She ran that company for 18 years before becoming “the sole founder of Prolacta Bioscience” in 1999, she said, raising about $5 million by 2004 to help develop a human milk fortifier, which can be added to donor breast milk to increase the nutritional value.
While at Prolacta, Medo said she managed the construction of their first processing plant, established the first “virtual” milk bank where mothers across the United States could donate milk by qualifying online, and developed the company’s main product called ProlactPlus, the first human milk fortifier made from breast milk.
But she said she clashed with the new CEO of Prolacta, who was hired in 2006. Within three years, she left the company.
Medo jumped into her new project in Lake Oswego, Ore., where she invented and sold a human-and-cow milk formula analyzer for research purposes.
Started in April 2009, Medolac Laboratories — originally called Neolac — created and sold the “first commercially sterile donor breast milk.”
Medo grew the company in Oregon, later moving it to Boulder City with her son and daughter, who co-founded Medolac.
Hospitals loved Medolac’s shelf-stable product, she said, the company was growing fast and Medo was doing what she had yearned to since that fateful day in the neonatal intensive care. They had a hand in saving the lives of roughly 800 to 1,000 premature babies a month, by Medo’s estimations.
Preterm birth crisis
In 2022, one in nine babies — or 11% of live births — were born preterm in Clark County, according to the March of Dimes. Nevada, along with Texas (11.3%), Alabama (12.8%), Louisiana (13.3%) and Mississippi (14.8%), ranks among states with the most preterm births per capita.
Carrying multiple babies, previous preterm births, diabetes, hypertension, smoking history and unhealthy weight are some of the many factors that could increase the likelihood of a pregnant person having a preterm birth.
“The state of infant and maternal health in the United States remains at crisis level, with grave disparities that continue to widen the health equity gap,” said Dr. Elizabeth Cherot, March of Dimes president and CEO, in a November news release. “We have long known that many of the factors impacting poor outcomes for moms and babies can and must be addressed if we are to reverse these trends. The fact is, we are not prioritizing the health of moms and babies in this country, and our systems, policies and environments, as they stand today, continue to put families at great risk.”
Breast milk’s healing ways
More premature babies being born means more breast milk is needed to help promote growth and avoid necrotizing enterocolitis, or NEC, a common, serious and sometimes-fatal intestinal disease among premature babies.
NEC affects premature infants or sick newborns and happens when the tissue lining their intestinal wall dies, then falls off, according to John Hopkins Medicine.
Symptoms include feeding intolerance, lethargy, unstable temperatures, vomiting and diarrhea. Although NEC can be treated through antibiotic therapy or surgery, in some cases, the disorder can be deadly. Over 7,000 babies a year are affected by NEC in the U.S. alone, and 50% of them die, according to the Nationwide Children’s Hospital in Columbus, Ohio.
About 50,000 infants are born with very low birth weight every year in the U.S., the Centers for Disease Control and Prevention said.
Preterm babies are often whole pounds lighter than they should be at birth, and human breast milk can actually decrease the risk of NEC. Pasteurized donor human milk plus a nutrient fortifier is the first recommended alternative for babies with very low birth weight, according to the CDC.
It’s why having a constant supply of breast milk — especially that of a human — is important, but only 10% of premature infants in the country have access to this, Medo said.
Legal battles
Around Christmas in 2014, Medo was sitting in her Lake Oswego office when she received the first cease-and-desist letter from her former company, Prolacta, ordering Medolac to stop using its trade secrets.
The timing was curious, she said, coming shortly after Medolachad secured its initial hospital accounts. And Medolac had already been in business for five years.
The lawsuit from Prolacta locked Medo and her company in a back-and-forth battle that continues today.
Medo said she was spending anywhere from $80,000 to $100,000 in trial preparation fees each time they were set to enter court, which “was eating up every dime that we were making.”
In 2020, Medolac filed a lawsuit against Prolacta alleging defamation, breach of contract and “tortious interference.” The company claimed that Prolacta violated a separation agreement between them and Medo and defamed the business owner, interfering with Medolac’s business operations. That suit is delayed until the ongoing original case is settled.
In total, Medo believes she’s spent over $5 million on legal costs over the past 10 years.
Meanwhile, Medolac fell behind on payments to its breast milk donors, filed for Chapter 11 bankruptcy in 2021, and the company was eventually liquidated in July of the same year. All of Medo’s employees, most of whom lived in Boulder City and came from the same family, were let go.
The trial became “economically devastating to those families” and Medo, who had to file for personal bankruptcy last October, she said.
Chris Kroes, one of Prolacta’s attorneys, told The Washington Post in 2022 that Medolac was never a viable company. He alleges that Medo constantly presents herself as the victim “being pushed around by a bigger company.”
Yet, Medo claims Prolacta at trial in 2020 “never provided any evidence” for its accusations, and she “never got a chance” to defend herself verbally. Once the countersuit is heard, Medo said she expected Medolac will prevail.
All of the legal issues aside, Medo says her story pales in comparison to what the families of premature babies are still experiencing, she said, especially with one less supplier in the breast milk market. This leaves some hospitals with less supply, and puts more babies at risk of developing NEC due to a lack of proper nutrients.
Her old factory off Boulder City Parkway in a vacant grocery store sits empty aside from the various machines that are tagged for an upcoming auction. They must be out of the building, which is still owned by Albertsons, by Aug. 23.
Since the plant was shut down, Medo has been researching different avenues to continue helping premature babies.
Some media production companies approached Medo about creating a documentary, but the entrepreneur is hoping the governor’s office can step in to help keep Medolac alive and that the federal Department of Justice investigates what she believes are antitrust violations.
“Something needs to be done, (and) I’m not gonna give up,” Medo said. “(Prolacta) has taken 10 years out of my life, and they’ve taken countless numbers of babies that should be here, so that’s my passion and that’s not going to change.”
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