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Obama's more enlightened view on stem cell research is good news for patients and the industry

An energy saving lightbulbOver the past decade, celebrities such as Michael J Fox and the late Christopher Reeve, have helped draw attention to the enormous potential advances stem cell research can bring. The energy that these Hollywood stars and countless other advocates in both the US and Europe have put into raising awareness reflects the level of hope and promise that rests with regenerative medicines.

Cell replacement has enormous untapped potential to treat multiple diseases such as diabetes, spinal cord injuries, stroke, macular degeneration, and Parkinson's disease with both clinical and economic implications. Stem cell research may also result in tissue engineered products with therapeutic application in heart disease and skin and cartilage replacement. For some, the ultimate goal is to use tissue engineering to replace failing organs. The WHO estimates that only 1 in 10 patients who need a kidney transplant – the organ most in demand – receives one. Given the breadth of diseases and the benefit that regenerative medicines may offer, it is easy to understand the proactive passion behind stem cell research.

However, stem cell research has triggered a series of ethical debates. Some countries, like the UK, have decided that the benefits outweigh the concern of using human (often embryonic) cells, the US – typically a world leader in cutting edge biotechnology research – has faced significant regulatory hurdles. Yet now the US regulatory environment is changing and US research may eclipse Europe in the race to bring regenerative medicines to markets.

This type of 'Superman' research offers hope to patients and their families. It is also projected to provide attractive financial rewards to investors. Currently, regenerative medicine has a market share of $1.5bn, roughly 3.5 per cent of the global biotechnology industry. However, Life Science Intelligence forecasts that this could increase to $118bn in 2013.

For many, regenerative medicine is a natural evolution of biotechnology, an area in which the US, historically, has been commercially dominant. The US biotech industry started over 30 years ago with the first production of recombinant human insulin. Since then the number of additional products developed in the US has dwarfed those flowing from European laboratories. In the US alone there are over 3,000 start-up biotech companies, each competing to bring new therapies to market.

Jeopardising innovation
Despite support from some key Republican leaders, US regenerative medicine was dealt a serious blow in August 2001. Fuelled by ethical concerns harboured by the religious right, President George W Bush restricted federal backing for stem cell-based research. The Executive Order limited funding to the 64 embryonic stem cell lines available at the time and stated that finance for the development of subsequent embryonic stem cell lines would be denied. It also limited funding to research equipment and perhaps, most worrisome, made the US much less attractive to leading scientists.

Poor Quality
Scientists have asserted that fewer than one-third of the 64 lines approved for federally funded research were suitable for developing products for human use. Most of these cell lines were contaminated by mouse cells that historically were used as feeder layers to support the growth of the stem cells, and that consequentially could introduce animal viruses into humans. Current methods avoid the use of animal feeder layers in order to minimise contamination issues.

Even if scientific groups were able to find non-federal or ex-US sources to back research, the Executive Order prohibited use of laboratory equipment financed with National Institutes of Health (NIH) funds for non-approved stem cell projects. This resulted in leading stem cell research universities like Johns Hopkins setting up entirely separate labs – a costly endeavour.

European Advantage
America's research centres had to figure out how to keep their top stem cell scientists and how to attract new scientists despite the barriers to funding and equipment. To retain researchers, tempted by opportunities in countries like the UK, (where the regulatory environment was more inviting), several large universities such as Harvard and the University of California supported stem cell programmes and actively sought private investment. Scientists also benefited from funding by individual US states, the most notable being California voters' 2004 decision to dedicate $3bn to stem cell research.

The US was not alone in its deliberation about the ethics of stem cell research. Europe has also struggled with its policies. According to the Hinxton Group (an international consortium on stem cells ethics and law), Austria, Lithuania, Poland and Slovakia have among the most restrictive stem cell research laws in Europe, which prohibit research using embryos or cells derived from embryos. Germany and Italy have a slightly more favourable regulatory environment but stem cell research is permitted only using cell lines created before a certain date. Havens for researchers exist in the UK and Sweden, where somatic cell nuclear transfer is specifically permitted under certain conditions. Additionally, the UK government has made regenerative medicines a political priority and is recognised for having among the most liberal stem cell research laws in the world.

Global welcome
The global community welcomed the election of President Obama for multiple reasons but the US scientific community held a very specific hope. This was realised on March 9 2009, when President Obama signed an executive order lifting the ban on federal funding for human embryonic stem cell research. 

Obama stated: "The majority of Americans – from across the political spectrum, and of all backgrounds and beliefs - have come to a consensus that we should pursue this research. The potential it offers is great, and with proper guidelines and strict oversight, the perils can be avoided."

Obama's actions were supported by leaders on both sides of the political aisle, including former First Lady, Nancy Reagan, who said that she was "very grateful" and hoped that this would help scientists "fulfill the promise that stem cell research offers".
The President's support of stem cell research was not limited to a photo opportunity with prize-winning scientists in an effort to gain support for a broader range of healthcare reforms. The NIH, responsible for scientific funding, has been given a federal stimulus package of $10bn earmarked for embryonic stem cell research. However, many scientists are unsure how quickly they will see the benefits and what additional approval from Congress is required before funding is made available.

Many hope that the recent July 2009 NIH guidelines will accelerate stem cell research in the US, allowing it to play catch-up. Story Landis, head of the NIH stem cell task force, and director of the National Institute of Neurological Disorders and Stroke, anticipates that the new guidelines will lead US grant-supported research into a potential 700 new stem cell lines.

The removal of the US federal funding ban will not result in a flood of funding or US scientific visa applications from Europe. However, it is an important victory for US-based research and also for patients across the globe who are poised to benefit.
Clinical trials recently given the green light in the US and the UK are just a hint of what is to come. In January 2009 the FDA granted permission for Geron Corp to initiate a Phase I multicentre trial for its embryonic stem cell based therapy for spinal cord injuries (GRNOPC1). Meanwhile, in the UK, ReNeuron is moving forward with testing a stem cell therapy for stroke (ReN001). These types of trials will hopefully encourage even more investment in regenerative medicine.

Challenges ahead
Political debate about ethics and funding is only the start. It will be vital for these companies to be prepared for the regulatory and reimbursement hurdles that lie ahead. Companies will be faced with a challenge of identifying which products hold the greatest promise and comprehensively capturing the value of those products.

Conventional value-based assessment uses the equation V= R+D, where V is the value, R is the reference and D is the differential value that the product brings. As these products will be the first to market there will be no viable references available, therefore the value is based purely on the strength of the clinical outcomes. Indirect references may be used, for example the cost of transplants or other surgical interventions that can help to provide indicative guidance.

The greatest challenge will be communicating the value to those who make decisions about what treatments are paid for by insurance or healthcare systems. Building a strong economic argument will help funding bodies realise the potential positive impact of regenerative medicine therapies on the burden of the disease. The reduction in total healthcare costs associated with debilitating diseases – such as long-term care, hospitalisation and morbidity – are often overlooked or not fully understood during value assessments and this can lead to underestimation of benefits.

It is likely to take many years before successful outputs of stem cell research are realised, but the work on capturing the value of these products should begin today, to lay the foundation for the huge investment that has been made. The doors have now been opened to encourage global scientific advancement in the regenerative medicine area – making patients the greatest success story in the stem cell research debate.

The Author
Dr Clive Whitcher is a consultant at  PriceSpective, www.pricespective.com
To comment on this article email pme@pmlive.com

2nd September 2009

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