The Bulgarian deputy minister for health has resigned over the country's decision to ban the use of a controversial stem-cell therapy to treat neurological disorders.

The therapy, which since 2005 has been carried out on around 250 patients at St Ivan Rilski Hospital in Sofia, contravenes European Union regulations and is of unproven value, the Bulgarian health ministry ruled on 8 August. Three days later the deputy minister, Matey Mateev, resigned in protest.

The therapy involves harvesting stem cells from a patient's bone marrow, concentrating and purifying them, then injecting them into the same patient's brain or spinal cord. It aims to regenerate nerves and stimulate metabolism after spinal-cord trauma, stroke or neurodegenerative disease, says Venceslav Bussarsky, who heads the hospital's neurosurgery department, and is also president of the Bulgarian Society of Neurosurgery. Each treatment costs €1,000–2,000 (US$1,500–3,000).

Bussarsky, who claims that companies or individuals with competing financial interests are behind the actions of the health ministry, says that the treatment was successful in nearly half of the patients.

But such stem-cell transplantation is highly controversial. "No scientific evidence has been shown from clinical trials that this treatment would have any positive effect in humans," says Paolo Bianco, a stem-cell researcher at the Sapienza University of Rome.

When Bulgaria joined the European Union in 2007, the country had to comply with the existing European directives on the transplantation of human tissues and cells. The St Ivan therapies contravene these directives, says the health ministry, which is also concerned about the lack of proof that the therapy is effective.

The ministry says that close relatives of Mateev own the two private companies that took part in the St Ivan transplantations — in violation of government ethics codes concerning conflicts of interest for leading officials. Mateev's "retirement" is connected to this violation, according to the ministry.

Mateev insists that the directives have been incorrectly translated into the Bulgarian language. "Also the committee did not talk to any of the medical people involved, they only inspected papers," he says. Mateev, a physician, was director at St Ivan from 2002 until 2006.