Washington Editor

WASHINGTON – The National Institutes of Health (NIH) can continue to support human embryonic stem cell (hESC) research while the government fights a lawsuit challenging the Obama administration's funding policies, an appeals court ruled late Tuesday.

The U.S. Circuit Court of Appeals for the District of Columbia permanently stayed an injunction imposed on Aug. 23 by U.S. District Judge Royce Lamberth, who ruled that the NIH's July 2009 funding guidelines violated the so-called Dickey-Wicker Amendment, which prohibits the use of federal funds for the creation of human embryos for research or research in which human embryos are destroyed or discarded. (See BioWorld Today, July 7, 2009, and Aug. 25, 2010.)

A three-judge panel from the appeals court earlier this month had temporarily stayed the injunction, and on Monday, the court heard oral arguments about whether taxpayer dollars should fund hESC research while the case is waged. (See BioWorld Today, Sept. 13, 2010.)

On Tuesday, the appeals court said the government had satisfied the standards required for a stay pending appeal.

The permanent stay provides "more security" for researchers that government funding will be assured for now, said Michael Werner, a partner at the Washington law firm Holland & Knight and executive director of the nonprofit advocacy group the Alliance for Regenerative Medicine.

"Obviously, it is not completely resolved, but this is certainly welcome news and a great step in that direction," he told BioWorld Today.

The court Tuesday also ordered the appeal in the case, known as Sherley v. Sebelius, be expedited.

Both sides have filed for summary judgment in the suit, which some have predicted is likely to go all the way to the Supreme Court.

Werner said that while he would not speculate on the government's strategies for pursuing the case, from the NIH's perspective, "the idea that somebody is challenging their peer-review processes is fundamental to the way they do things, so I would think seriously about making sure that is legally resolved and doing whatever is necessary."

The Biotechnology Industry Organization said it plans to file an amicus brief at the "appropriate time to explain the harm that the lower court's initial reading of the law would cause to the future ability of our member companies to innovate on behalf of patients."

White House Press Secretary Robert Gibbs Tuesday night said the Obama administration was "heartened" by the appeals court's ruling.

"President Obama made expansion of stem cell research and the pursuit of groundbreaking treatments and cures a top priority when he took office," Gibbs said.

While the tide is turning in favor of hESC funding, the fight is not over, said Sen. Tom Harkin (D-Iowa), chairman of the Senate Health, Education, Labor and Pensions Committee, who is backing Senate legislation sponsored by Sen. Arlen Specter (D-Pa.) aimed at ensuring continued government support for hESC research.

Reps. Diana DeGette (D-Colo.) and Mike Castle (R-Del.) also introduced two hESC-related bills in the House.

The Stem Cell Research Advancement Act of 2010, introduced in the House in March, seeks to codify President Obama's March 2009 executive order, which removed President Bush's funding limitations on hESC research, while the Regenerative Medicine Promotion Act of 2010, introduced last week, would provide $850 million in grants to accelerate the availability of regenerative medicine products, including those derived from hESCs, among other provisions. (See BioWorld Today, March 10, 2009, and March 11, 2009.)

The plaintiffs in the case, researchers James Sherley and Theresa Deisher, are arguing that the NIH's hESC guidelines violated Dickey-Wicker and impeded the researchers' work with adult stem cells by increasing competition for limited government resources, causing irreparable injury to their research.

Sherley is a biological engineer at Watertown, Mass.-based Boston Biomedical Research Institute, while Deisher co-founded and oversees R&D at Seattle-based AVM Biotechnology Co.

The two researchers earlier had been joined in the case against HHS Secretary Kathleen Sebelius and the government by several hESC research opponents, including the Nightlight Christian Adoptions and the Christian Medical Association.

But the federal district court in October 2009 dismissed the suit, finding that those opponent groups lacked standing. The plaintiffs appealed, and the appeals court concluded that Sherley and Deisher had standing under the competitor doctrine.

In his August ruling, Lamberth asserted that hESC researchers would not be harmed because the injunction would simply preserve the "status quo" and would not interfere with their ability to obtain private funding.

He also contended that patients would not be harmed by the injunction because hESC research currently is "speculative," with no certainty it would result in successful treatments for diseases, such as Alzheimer's or Parkinson's.

The plaintiffs' "injury of increased competition, however, is not speculative. It is actual and imminent," Lamberth wrote, adding that the NIH guidelines "threaten the very livelihood of plaintiffs Sherley and Deisher."

But NIH Director Francis Collins in testimony before a Senate subcommittee earlier this month insisted that his agency was "strongly committed" to adult stem cell research and has "invested many hundreds of millions of dollars over the years" in that area.

"Indeed, annually we are spending almost three times as much on adult stem cell research as on human embryonic stem cell research," Collins told the Senate Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies. (See BioWorld Today, Sept. 20, 2010.)

The NIH has so far invested more than $500 million in hESC research, distributing $137 million in fiscal year 2010 for 199 grants, he noted.

The plaintiffs' argument that hESC research has not produced the same results as the five decades of adult stem research "speaks not to the relative merit of the two types of research, but to the pressing need to allow hESC research to develop to its full potential," Story Landis, chairwoman of the NIH Stem Cell Task Force, said in a declaration filed with the appeals court.