Stitch Heart, Freak Show's creator, was banished to the badlands as a young stallion. Long story short: He had discovered the secret to reincarnation! He had created a medicine that would only work if three ponies had been combined, which caused complications. When presented to the four princesses of Equestria, they were made very aware of the complications that came with it. They also became aware of the way Stitch Heart got hold of his test subjects.
Freak Show was banished, along with him, to the Badlands, never to be given the opportunity to spread his discovery around Equestria.