The 'Stem Cell Doctor'

Feb. 7, 2007 — -- At 7:30 a.m. in the small Mexican border town of Los Algodones, shopkeepers set up their stalls and sweep up. Most of the schoolchildren have already left their homes.

On the edge of town, Americans start to line up -- most of them are older and, in one way or another, sick. They are trying to get a good spot in line to cure their ailments, which range from lung problems and cancer to multiple sclerosis and grinding pains that will not go away.

They wait in line to see Dr. Jose Diaz Barboza, known to his patients as Dr. Diaz. Americans flock to him to receive injections of live cells, injections that ease their pain.

Bonnie Good has been visiting Diaz for four years.

"In November, he treated me for sleep apnea. It got so it was moderate to severe sleep apnea," she said.

Diaz gave her shots of cells, and after 15 years of suffering from sleep apnea, it was gone.

Sleep apnea is not the only problem for which Good visited Diaz.

"I had the bad back, the bad knees, the bad shoulder, the bad neck, osteoarthritis of the spine. It's wonderful. I lay there on that table, and he gave me those shots and the pain was gone before I got up. And I couldn't hardly walk. … Miracle," she said.

Good's son, Rusty, made a 1,700-mile drive just to see Diaz. He has had multiple fractures, including a broken neck, and on the day of his most recent visit to Diaz, he complained of pneumonia.

After a few shots from Diaz, Rusty was pain-free.

"I don't feel anything in my back now. It hurt like crazy when I come in here. It hurt bad all week. Now I feel nothing. It's perfect," he said.

Tourism for Pharmaceuticals

Americans come from all over the country to see Diaz in Los Algodones. It is a tourist town, but its tourist attraction is medicine.

Brand-name pharmaceuticals, usually prescription only, are sold at a fraction of what they cost in the United States. You can walk 30 feet and get an offer for a free beer and a margarita, but you can also find pharmacies, dentists' offices, and opticians with unbelievably low prices.

Then there is Diaz.

Trained as a surgeon in Mexico and Cuba, he says that many doctors in Mexico City and the United States would think his methods were crazy. But he says that they work, and that his patients are his biggest defenders.

Phyllis Pickerill waited 14 hours to see Diaz about her lungs. She spent eight years on oxygen because her lungs were damaged and blocked. Her first visit to Diaz cleared up the problem.

"Within 15 to 20 minutes of my first stem cells I was able to breathe. I walked out of here and walked out of here without my oxygen," Pickerill said.

That was several years ago.

"When she [first] came, she was in really bad condition. Everyone was scared, even the other patients," Diaz said.

Now, Pickerill gets a "booster shot" every eight months.

Diaz seems to be getting good results. Many patients believe he is treating their ailments with human stem cells, but he says he is not.

"There is a mistake," Diaz said. "It's not the right name."

Diaz's shots are actually live sheep cells, and he believes some patients are confused by all the news about stem cell research. He tells them they are not receiving human stem cells.

Pickerill understands that her independence from her oxygen tank is not a result of human stem cells.

"In the beginning it felt very strange to think they were going to put lamb into my body. But since then I've never given it a thought. I just know that it works," she said.

Pickerill is convinced, but other doctors that ABC News spoke to predicted that the immune system would simply attack animal cells and destroy them, making them pointless.

But Pickerill says she can feel the difference, and so does her checkbook. This treatment from Diaz cost her $908. It is not covered by her insurance. It's a high price, but after paying his staff and paying for the actual cells, Diaz says he only sees $150. That is not a lot of money for a doctor, especially one that regularly spends at least 45 minutes with every patient, listening to each one's problems.

The attention Diaz gives to each patient raises an important question: Is it the personal touch that his patients like so much?

Maybe it is the placebo effect: Patients feel better because they think they are getting something special.

"The question is a good question," Diaz said. "Maybe the answer would not be good for me."

But don't tell Pickerill that.

"If you've ever had anything wrong with you where you couldn't breathe, where you gasp for every breath, you would understand what I'm saying," Pickerill said. "You can't have that in your head."