| Stem-cell stocks damaged by study Researchers see culturing contaminating stem cells |
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BOSTON (MarketWatch) -- Shares of three stem cell-related companies fell sharply Monday after a study asserted the bulk of embryonic stem cells used for U.S. research are contaminated and may not be suitable to transplant into humans. Shares of Aastrom Biosciences (ASTM: news, chart, profile) closed down nearly 20 percent at $3.23. StemCells Inc. (STEM: news, chart, profile) , meanwhile, fell almost 16 percent to $4.99, and Geron Corp. (GERN: news, chart, profile) lost 6.29 percent to $8.04. Shares of the newly public ViaCell Inc. (VIAC: news, chart, profile) appeared to be unscathed, moving up about 5.01 percent to $9.12. The study, conducted at the University of California in San Diego and the Salk Institute, blamed the contamination on animal-derived culturing agents that scientists use to grow embryonic stem cells. Reports of such contamination are not new. Proponents of creating new embryonic-stem-cell lines have often said that the culturing agents, most of which contain mouse cells, have contaminated key stem-cell lines used in basic research. Yet while the news is of considerable importance to scientists engaged in academic research, it is not likely to have as much of an impact on stem cell companies, few of which are engaged in embryonic stem cell cultivation. "[The stem-cell-related stocks] are all moving because nobody knows the differences between the companies. They move as a group, rightly or wrongly," said Stephen Dunn, an analyst for Dawson James Securities, who tracks stem-cell companies including Aastrom. In a report to be published in the February edition of the journal Nature Medicine, the UC-San Diego and Salk researchers posit that most of the nation's embryonic-stem-cell lines, groups of cells culled from human embryos, have been contaminated by foreign genetic material. Because of this contamination, the researchers believe the embryonic cells could trigger a severe immunological reaction if transplanted into humans for therapeutic purposes. Fred Gage, a leading researcher for the Salk Institute and a founder of StemCells Inc., was a key member of the research team, according to Nature Medicine's Web site. Stem cells are primitive cells that have the ability to transform themselves into the more specialized cells that make up the human body. Scientists have been seeking ways to use the cells to repair damage caused by disease or injury. Embryonic stem cells are culled from days-old embryos donated by fertility clinics. Stem cells can also be derived from tissues in the human body and blood found in umbilical cords. While StemCells, Aastrom, Geron and ViaCell all are working on stem-cell therapies, the types of cells they have used and how they have been cultured vary greatly. StemCells, for example, uses fetal stem cells for its leading stem-cell therapy product. That product is currently in Phase I clinical trials for the treatment of Batten disease, a fatal genetic disorder that affects the central nervous system. The stem cells are derived from donated brain tissue from miscarried, stillborn or aborted babies, according to StemCells Chief Executive Martin McGlynn. "We're not engaged in embryonic stem-cell research," said McGlynn late Monday. McGlynn added that the stem cells are cultivated in a media that doesn't use any animal or human-derived "feeder" cells to help them grow. Meanwhile, Aastrom also emphasizes it does not use embryonic stem cells in its products. Aastrom is conducting Phase I clinical trials on a product that takes stem cells from a patient's own bone marrow and replicates them for transplantation to heal severe bone fractures. A spokeswoman for Aastrom said Monday that the company did not grow its therapeutic stem cells in any media that employs mouse cells. Dunn said he recently lowered his rating on Aastrom from "buy" to "neutral" due to the stock's high valuation. Geron Corp., which saw a far narrower swing in its stock, has had a long-standing program engaged in embryonic stem-cell research. The company's work, however, has been more focused on developing cancer drugs based on the enzyme telomerase. Breaking from the pack on Monday was newcomer ViaCell, which held its initial public offering Friday, offering 7.5 million shares at $7 a share. While ViaCell has a stem-cell-based therapy in Phase I clinical trials, the company's revenue is mainly derived from storage services for umbilical-cord blood for future therapeutic use. ViaCell's stem-cell products are derived from umbilical-cord blood. |
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