Blood Banks Find Business In Biotech Potential

Publish Date:10/10/2003
Story Type:Economy;
Byline:Myra Lu

        Four years ago, companies began cropping up in Taiwan offering umbilical-cord blood storage. At first, most
people had no idea what sales representatives were trying to sell them. For many parents-to-be, the idea of paying
someone to collect and store the blood from the cord of their newborn baby seemed, at worst, morbid, and at best, a
dubious investment.

        Today, however, there are six cord-blood banks that compete for business in the Taiwan market, which has many
people wondering if the practice is gaining acceptance on the island. Cord-blood banking--already popular for some time
in the United States and Europe--offers a chance to cure certain diseases that might develop later in life, according
to company executives.

        The process involves harvesting blood from umbilical cords and placentas, which are routinely discarded after
the birth of the child. Studies have shown that stem cells from the cords of newborn babies sometimes have the ability
to give rise to the blood cells that carry oxygen and fight infections. The practice of transplanting stem cells found
in cord blood has even been hailed by some doctors as an effective alternative to bone marrow transplants--a technique
in which bone marrow is transplanted from one individual to another to stimulate growth of blood cells. The problem
with bone-marrow transplants is that finding a compatible donor can be extremely difficult.

        Studies have proven that stem-cell transplants can be effective in treating such diseases as leukemia, lymphoma
and certain forms of anemia. The first successful transplant was reported in the late 1980s. To date, more than 3,000
umbilical-cord blood transplants have been performed worldwide. National Taiwan University Hospital has so far
conducted four successful cord-blood transplants between relatives after it conducted the country's first such
operation in 1995.

        Putting newborns' cord blood away for a rainy day has been billed by cord-blood banks as a new type of
insurance. "This is what we call biological insurance," said Lee Jau-nan, general manager of Sino Cell Technologies,
Inc. "Private cord-blood banks provide parents with a personal safety deposit box. The stored blood would be used, if
the necessity arises, on the donor himself or a family member." After being collected using syringes, the blood is
transported to a special facility where it is frozen in liquid nitrogen.

        Storing cord blood did not attract much public attention in Taiwan until the president's daughter, Chen Hsing-
yu, stored the cord blood of her firstborn with a private bank a year ago. Herself a dentist and her husband an
osteologist, their combined medical background inadvertently lent strength to the sales pitches of cord-blood
companies. Her celebrity as the nation's first daughter certainly helped, too.

        HealthBanks, the company that won the first family's business, reportedly saw its sales skyrocket afterwards,
compelling it to purchase a second storage tank. HealthBanks executives claim that cord-blood storage in Taiwan stands
at about 4 percent--meaning four of every 100 newborns have their blood saved--double the rate in the United States.
They expect that number to hit 10 percent in the near future. The company itself has more than 3,000 samples, which it
says represents at least a 40-percent market share, and it hopes to reach 10,000 by year's end.

        Though it has fewer clients than its competitor, Sino Cell has also seen its storage business increase by more
than 25 percent since opening in April 2000.

        According to statistics cited in the June issue of the Far Eastern Economic Review, the global private cord-
blood storage industry was worth US$100 million in 2001 and is expected to increase fivefold by 2005. Local companies,
meanwhile, offered a ballpark figure of US$6 million for the annual value of the Taiwan market.

        Still, the opinion of parents is divided on what the future of medicine holds. Sophia Wong, a 37-year-old bank
employee and a mother of two, said if she had a chance, she would have stored the cord blood of her babies. "It could
someday provide a cure for the diseases the parents have developed when they grow old," she said.

        Others are less accepting of the idea, mostly because there has yet to be any guarantee of future application.
"I would not do it unless you could tell me exactly what I would be saving the blood for," said Linda Lin, an office
worker. Despite studies that have proven that cord blood can be frozen for up to 18 years, questions remain about its
viability for medical use after that.

        Along with many of her friends, Lin also expressed concern about the expense of blood storage. Parents are
initially charged at least US$2,200 for the collection and deposit of the cord blood, plus an additional yearly storage
fee.

        Recently, however, increasing competition has prompted many private cord blood banks to attract new customers
with a variety of services. Some offer lower-than-market prices, free cancer check-ups for parents and life insurance
policies for newborns. Many companies have even teamed up with financial institutions to put a portion of storage fees
into trust funds in an attempt to provide assurance to potential customers.

        The increased competition is good news for consumers, but it has company executives scrambling for market
share. "Just count the number of cord-blood banks in Taiwan," suggested Lee. The obstetrician opined that business
prospects are not as good as people think, not just because of intense competition, but also because the future of stem-
cell research is unknown.

        While he admits to being a firm believer in the potential of stem-cell therapy, Lee nevertheless expressed
understanding of parents' reluctance to spend so much money to store blood. "We have seen a ray of hope in the research
published so far, but most of it consists of individual case studies," he stressed. "The science has yet to amount to
anything substantial." Blood-forming stem cells are the only type commonly employed in therapeutic applications today.
Although some scientists are touting other potential applications for the technology, such as treating Parkinson's
disease, Alzheimer's, diabetes and heart disease, methods for doing so have yet to come out of the laboratory.

        Most researchers agree that, in the final analysis, parents are essentially buying peace of mind. However,
since private blood banks are eyeing the potential market represented by cell therapy, many are either working with
research institutions or have their own scientists doing related studies.

        One major obstacle for umbilical cord blood transplants is that the amount of stem cells that can be extracted
is only enough to treat a patient that weighs less than 40 kilograms. Therefore, medical researchers have been eager to
find ways to grow stem cells in the laboratory--a process sometimes referred to as ex vivo expansion.

        Shih Chu-chi, professor at City of Hope Medical Center in the United States, pointed out that ex vivo expansion
of human stem cells can be quite taxing. Shih, a stem-cell researcher, suggested that much work is needed before any
solid scientific claims can be made. Shih is working on ways of implanting neural stem cells into the human pancreas to
generate insulin. Although he believes this research to be very promising, he does not expect clinical trials to begin
for at least five years' time.

        Even so, John Wagner, a professor of pediatrics at the University of Minnesota, who was in Taipei recently for
a stem-cell conference, demonstrated with his research that it is possible to amass umbilical cord blood from several
donors--thus gathering enough stem cells--to perform transplants in adults. He said the success rate might reach 45
percent.

        While a private storage arrangement represents one option for parents, public storage is also available, except
that the blood will be open to use for whomever can demonstrate an urgent need for it. Taiwan has four public
facilities that offer cord-blood storage. Too many, according to Lee. "The government should think of a way to
integrate their services," he opined.

        Shih believes that such services should not be considered a biotechnology business, but rather a matter of
public concern. "That way, we will be able to pool enough samples to benefit more people," he explained. "Cord-blood
storage is a worthy undertaking but it would be more practical if the government would administer it." At public
storage banks, donors bestow their children's cord blood to society in general primarily as an act of altruism. Donors
may never have to use the blood, but someone else's life could be saved as a result of their contribution.

        No matter the details, cord-blood storage is one of the preliminary steps toward stem-cell research--an avenue
of studies that many countries are industriously pursuing, and Taiwan is no exception. Several teaching hospitals,
Academia Sinica, National Health Research Institutes and the Industrial Technology Research Institute have set up
specific research centers or programs on stem-cell studies.

        Yet the fact that so many research groups are doing the same thing worries Shih, who opined that a degree of
integration is needed. "No one single institution is able to accomplish anything in stem-cell research. Focusing our
now-scattered resources and finding a common objective will better ensure eventual success." What can be expected seems
to be that the faith of most scientists in medicine will continue to fuel the industry of cord-blood banking and cell
therapy. The general public can only hope for the best.

SOURCE: Taipei Journal, Taiwan
http://publish.gio.gov.tw/FCJ/current/03101081.html

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