Last paragraph cites failed attempt to use ASCRs to treat PD

 On The Cover
Anti-Ban Billionaires
Matthew Herper and Robert Langreth 08.16.06, 1:00 PM ET

Billionaire cash has kept embryonic stem-cell research alive--just barely.

Anti-abortion crusaders see research on embryonic stem cells as something
akin to murder. Eli Broad sees it as a great way to save lives--and he is
tapping his $6 billion fortune to help. Sidestepping the ban on federal
funding of most stem-cell experiments imposed by President Bush five years
ago, Broad, the founder of builder KB Home (nyse: KBH - news - people ),
gave $25 million in February to the University of Southern California to
erect a stem-cell building.

More gifts may loom, he hints. Broad says he is saddened by the Bush
Administration's stem-cell ban, which has constrained funding, forced
universities to set up redundant labs off-site and let Singapore, Australia
and Europe pull ahead of the U.S. in one of the most exciting new fields for
fighting disease. "The promise is great," he says.

Embryonic stem cells are nascent bits of unformed genetic potential that
later turn into cells that make up the brain, the heart, blood and bone and
every other kind of cell in the body. One day researchers hope to turn stem
cells into versatile scientific tools to repair damage at the root of
Parkinson's disease, Lou Gehrig's disease and other maladies; the stem cells
also could help develop drugs and test medicines for dangerous side effects.

But creating a stem cell requires destroying embryos when they are
five-day-old balls of a hundred cells, such as fertilized eggs discarded
after an in vitro fertilization. The embryo defenders say each of these
microscopic balls is a human life that shouldn't be wasted. They argue that
using adult stem cells culled from patients would suffice, though many
biologists disagree.

Since the ban, federal funding of embryonic stem-cell work has risen to all
of $40 million a year, just one-fifth of the money for other kinds of stem
cells and a pittance in the $20 billion research budget of the government's
National Institutes of Health. But Eli Broad and a few other
billionaires--some of them from President Bush's own Republican Party--and a
number of states and private foundations have stepped into the gap. They
have funneled three times as much as the federal government into embryonic
stem-cell research.

The anti-ban donors include Michael Bloomberg, the billionaire and
Republican mayor of New York; Ray Dolby, inventor of the Dolby sound system;
Oracle (nasdaq: ORCL - news - people )founder Larry Ellison; and such
philanthropies as the Starr Foundation and the Michael J. Fox Foundation.

"It is too early to offshore a new industry before it is born," says Andrew
Grove, an Intel Corp. (nasdaq: INTC - news - people ) founder and one of the
first to fund stem-cell study despite the feds' ban. Bloomberg promises $100
million to fund stem-cell and other biotech research at Johns Hopkins
University, blasting the Bush regime for abrogating government's "most basic
responsibility" to safeguard the public health when stem-cell breakthroughs
may "save the lives of millions."

In California voters have okayed a $3 billion outlay after lobbying from
Bill Gates and Ebay founder Pierre Omidyar. Opponents have tied up the
funding in court, but in the meantime Republican Governor Arnold
Schwarzenegger has lent the state's stem-cell agency $150 million to get
going. Those bucks should start hitting university wallets early next year.
Researchers "from top labs across the country are coming to California,"
says neuroscientist Zach W. Hall, who oversees the effort. Still more
funding is set in Connecticut, Illinois, Maryland, New Jersey and Wisconsin,
states that have passed or are considering pro-stem-cell laws.

If the nonfederal funding accomplishes its goal, it will be breaking new
ground. Every major medical treatment from Taxol to Lipitor has its roots in
NIH-funded basic science. Without the NIH imprimatur, some young scientists
are reluctant to stake their careers on embryonic stem cells. Roger Ashby,
who heads StemCell Ventures, a tiny New York firm that funds experiments in
Europe, says the U.S. restrictions give scientists overseas a huge
advantage: "In America scientists are always looking over their shoulders
and wondering if they are breaking a law."

Stem-cell research dates to 1981 and started out with mouse embryos, which
researchers used to study the effects of individual genes and to try
treating disease in mice. In 1988 came the first federal ban when the first
President Bush barred implanting humans with fetal tissue (fetuses are far
more advanced in development than microscopic embryos). President Clinton
took office in 1993 and lifted that ban, but in 1994 he ceded some ground to
the anti-stem-cell crowd by blocking the use of federal money to create
embryos for research. In 1996 the Republican-controlled Congress began
forbidding the NIH to use funds for research in embryonic stem cells.

Two years later, though, one researcher derived the first human embryonic
stem cells by turning to private funding. James Thomson, a biologist at the
University of Wisconsin-Madison, turned to Geron (nasdaq: GERN - news -
people ), a biotech firm in Menlo Park, Calif., to fund work at an
off-campus lab and sidestep the U.S. ban. Other scientists took note, and
pressure arose to ease the restraints on stem-cell labs.

Cut to August 2001: President George W. Bush, confronted with the
controversy, splits the embryo. He decreed that no U.S. funding can go to
new stem-cell lines ("That cluster of cells is the same way you and I
started our lives"). But he allowed federal grants for embryo lines that
already existed.

"It was wholly inconsistent," says Douglas Melton, a Harvard researcher.
"There's no difference in the moral status" of a pre-ban embryo and a
postban one. President Bush cited 60 existing lines that wouldn't lose
funding--but Intel's Grove knew at most 20 existed and assumed the Bushies
knew that, too. "The matter in which that happened indicated a
disingenuousness about it that pissed me off," Grove says in an interview.

So in 2002 Grove shot back, handing a $5 million gift to the stem-cell lab
at University of California, San Francisco. Since then, UCSF has begun
efforts to fund a $100 million lab devoted solely to stem-cell research,
starting with $16 million from Ray Dolby. "We hope to build it as quickly as
possible, perhaps in four years," says UCSF neuroscientist Arnold
Kriegstein. The school's previous stem work had to go on at two off-campus
sites to avoid the Bush blockage. "To get any of these advanced cell
therapies into humans for the treatment of disease, we need to use human
cells," he says.

Even Republicans in Congress began fretting that the Bush ban went too far.
Last year Senate Majority Leader William Frist suggested lifting the ban,
and by summer both houses of Congress voted to do so. The President killed
it with his first-ever veto in July, saying the bill supported "the taking
of innocent human life in the hope of finding medical benefits for others."

Disappointed though he is in the veto, billionaire Broad says he is
optimistic Bush's successor will reconsider the issue. His $25 million gift
to UCS will build a 215,000-square-foot lab dedicated to embryonic stem
cells, the biggest such lab in the state once it is ready in 2008.

Moreover, another 100 or so stem-cell lines have been created despite the
Bush crackdown. Harvard University has raised $50 million in private funding
and has devised 30 new lines from frozen embryos donated by infertile
couples; other lines have emerged in Britain and Japan. Harvard's Melton
says: "It's just common sense that a ball of cells frozen in liquid nitrogen
is not the same as a 5-year-old girl with diabetes."

He uses stem cells to study juvenile diabetes (his son and daughter have
it), turning to the foundation of another billionaire--the late Howard
Hughes. "Not only did we have a legal right to fund the research, we had an
obligation," says Thomas Cech, president of the Howard Hughes Medical
Institute.

Melton landed enough money to start a separate lab, and he works on turning
his stem line into insulin-producing cells to study where they go wrong in
diabetics. But half his budget goes to redundant lab gear and overhead he
wouldn't need if it weren't for the NIH rules against stem-cell funding. His
stem-cell colleague at Harvard, M. Wiliam Lensch, uses only private funding
from Harvard but worries about getting in trouble if he merely talks to
NIH-funded peers in his lab.

At Memorial Sloan-Kettering, stem-cell biologist Lorenz Studer has received
money from Project A.L.S. and the Starr and Michael J. Fox charities (Fox,
the actor, has Parkinson's). He cautiously puts yellow stickers on every
piece of equipment used for banned experiments to inoculate his operation
from any NIH contact. His grad students put stickers on wastebaskets to mock
the NIH.

Douglas Kerr, a scientist at Johns Hopkins, which is using money from
billionaire Bloomberg to create a stem-cell lab, says the lack of NIH help
could delay a treatment for spinal cord injury for decades. In July he
coaxed mouse embryonic stem cells to reconnect the nerves and muscles of
paralyzed rats, allowing limited walking. With U.S. funding a treatment
might be ready for human trials in five years, but that won't happen in the
current climate. "I am stuck. It is amazingly frustrating," he says. "All I
see are paralyzed patients. They have been following this work and I have to
tell them I cannot do the experiments."

Still, some billionaires have shied away from this science scrap. Bill
Gates' foundation, the largest in the world with $29 billion on hand, has
put less than $2 million into research on human embryonic cells--at a lab at
Peking University in China. Researchers there are implanting human cells in
mice to look for better ways of making vaccines against aids and hepatitis
C. A spokesperson for the Gates Foundation says the Peking researchers hit
on the right idea; that the foundation hasn't funded a single stem-cell test
in the U.S., she adds, isn't related to the anti-abortion fight.

An ardent opponent of stem-cell experimentation, Focus on the Family, takes
a hard line. Billionaires have the right to fund this new field, says a
senior analyst at the group, Carrie Gordon Earll, but she adds that all such
research is immoral. "To destroy those human embryos is a huge moral
question. We're opposed to destructive embryo research regardless of who
funds it."

What of the argument that stem cells harvested from adults offer plenty of
opportunity for research? Many lab coats demur. Adult stem cells in bone
marrow can turn into blood and muscle and have great promise for treating a
few diseases, such as heart failure and leukemia. Bone marrow transplants
for blood cancers work because the marrow contains stem cells for producing
blood. Similar cells show great promise in treating heart failure, as do
cells from umbilical cord blood.

But no good alternative to embryonic lines exists for studying other
diseases. Memorial Sloan-Kettering's Studer spent years trying to transform
adult stem cells into neurons to study why they die off prematurely in
Parkinson's disease. He failed and had to resort to embryonic cells.
Harvard's Lensch is studying the causes of a rare genetic anemia, but once
stem cells become blood or bone marrow, he loses any chance to understand
what goes wrong early in the disease.

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