This week brought with it a lot of excitement in the scientific community, as President Obama signed an executive order to bolster human embryonic stem cell research. In 2001, President Bush signed an order prohibiting federal spending for research conducted on non-existing embryonic stem cell lines, despite the great promise these cells have for curing disease, because the cell lines would be generated by destroying human embryos.
Before reversing the Bush administration's policy, President Obama said, "Today, with the executive order I am about to sign, we will bring the change that so many scientists and researchers, doctors and innovators, patients and loved ones have hoped for and fought for these past eight years: We will lift the ban on federal funding for promising embryonic stem cell research. We will also vigorously support scientists who pursue this research. And we will aim for America to lead the world in the discoveries it one day may yield."
His speech mirrored the balance of cautious optimism shared by scientists and patients alike, but his measured words did not stop biotech stocks from enjoying a bump in the stock market. California-based Geron, the company that received the first FDA approval to begin clinical studies of an embryonic stem cell therapy earlier this year, saw a 20 percent jump in stock prices. Other biotechs involved in stem cell research, such as Maryland-based Neuralstem and California-based StemCells, Inc., also saw increases.
Even small, non-traded biotechs that are dependent on the dwindling pool of venture capital are likely to see a benefit from this news. By opening up federal funding opportunities to a broad range of promising embryonic stem cell research, small biotechs working with embryonic stem cells can seek alternative sources of funding, such as university collaborations and federal grants, just as the economic downturn is drying up VC spending.
Juhi Kunde, Science Writer & Senior Account Executive
