Will dollars follow the stem cell breakthrough?

Researcher Shruti Dave examines stem cells through a microscope at the Transplantation Biology Research Centre situated at The Institute of Kidney Disease and Research Centre (IKDRC), Civil Hospital campus in Ahmedabad on February 6, 2013.

There's a new scientific paper out that's gotten a whole lot of attention. Scientists in Oregon have learned how to turn human skin cells into embryonic stem cells.

It's a development that raises once again the prospect of human cloning and so comes loaded with questions -- scientific, moral, legal and financial.

Will the results of this new experiment lead to more stem cell investment? You’d think a breakthrough like this would have venture capitalists lining up to cash in on turning cells into nearly any organ in the human body. But Greg Bonfiglio, managing partner of the firm Proteus, says private investors have been burned before.

“When you lose a lot of money or when a nuclear bomb goes off in your portfolio, you typically stay away from that sector,” he says.

Making things even trickier for investors is that stem cell research is politically hot. With all the bio-ethical debates around cloning, it’s been harder to get your hands on money.

Tim Kamp oversees the Regenerative Medicine Center at the University of Wisconsin. He works on the heart.

“For example, one of the main supporters of cardiovascular research in the American Heart Association. And they’ve made a policy decision that they’d rather pass on funding human embryonic stem cell research,” he says.

Kamp says much of his funding has come from the federal government. Since 2002, the National Institutes of Health has spent several billion dollars on human stem cell research. The NIH’s Story Landis expects Washington will continue to invest, but at the same pace despite this new research.

“It’s a technological achievement. But is it going to change the strategies and opportunities that we have, no,” she says.

But Greg Bonfiglio says this advance may change the strategy for venture capitalists.

“Assume the technology is accurate, that they have now made this breakthrough. The next step in the process to bringing that breakthrough from bench to bedside is to commercialize it,” he says.

And even with all those past losses, Bonfiglio the money is going to come.  

About the author

Dan Gorenstein is the senior reporter for Marketplace’s Health Desk. You can follow him on Twitter @dmgorenstein.

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