MILWAUKEE - Despite limits on federal government support, ethical debates, intellectual property disputes and a host of technical difficulties, embryonic stem cell research is moving forward.

At least that was the conclusion reached by a panel stem cell experts speaking at the BIO Mid-America Venture Forum Tuesday morning. And while the public eye remains focused on the potential clinical benefit of hESCs, panel chair Michael Werner of The Werner Group noted that significant progress is being made in the application of hESCs to research technologies.

For example, panelist Elizabeth Donley, CEO of Stemina Biomarker Discovery Inc., said her company uses "stem cells as bioreactors." After exposing hESCs to various drugs, Stemina profiles the metabolites secreted to identify biomarkers and pathways associated with toxicity. The approach provides "a unique way to look at developmental toxicities," Donley said, which is important since pregnant women cannot be studied in many clinical trials and animal models of toxin-induced neurodevelopmental disorders are often inadequate at predicting human response.

Panelist Nicholas Seay, CEO of Cellular Dynamics International Inc., also is working with hESCs for toxicity screening. His company uses hESCs to create cardiomyocytes in screening for cardiac toxicity. And panelist Michael Haider, president and CEO of BioE Inc., said his company provides licenses to its Multi-Lineage Progenitor Cell line, derived from human umbilical cord blood, for in vitro research.

Beyond toxicity screening and other predictive uses, hESC-based models may help elucidate the underlying causes of numerous diseases. And research into clinical applications is advancing as well, albeit not as quickly as clinical research with adult stem cells. But the hESC field still faces many challenges.

On the scientific side, Donley acknowledged a need to deal with immune rejections of the transplanted stem cells. She said scientists are researching options that include using immunosuppressive drugs, therapeutic cloning to create patient-specific hESCs that could then be differentiated and transplanted, stem cell banking to gather genetic profiles and other approaches.

Another scientific challenge for hESCs, according to Haider, is "taking what you can do on the bench and making it commercializable." He specifically noted scalability and the ability to control potency as obstacles.

Funding also is a concern in the stem cell field. Panelist Joe Hildebrandt of the Phenomenelle Angels Fund, which invests in women- and minority-owned Midwest businesses, noted that while early-stage investors are excited about stem cells, they often are looking for a quicker exit than these companies can provide. Government funding also has proven difficult to obtain, with limits on federal funding for hESC research and state-run efforts such as California's $350 million Prop 71 getting bogged down in lawsuits. (See BioWorld Today, May 18, 2007.)

Another component often blamed for slowing the pace of hESC research is intellectual property, specifically patents held by the Wisconsin Alumni Research Foundation (WARF) that some have called overly restrictive. In April, the U.S. Patent and Trademark Office issued a preliminary denial of claims in three WARF stem cell patents, which some lawyers predicted may lead to the patents eventually being rejected. (See BioWorld Today, April 4, 2007.)

On Tuesday's panel, Jennifer Williams, market analysis manager for patents and licensing development at WARF, defended her firm's position, pointing out that WARF has granted licenses to more than 400 academic institutions and 60 companies. She also said WARF tries to "adapt to the needs of the community," which it did by loosening its licensing policies in January. (See BioWorld Today, Jan. 25, 2007.)

The other panelists sided with WARF, and Donley volunteered that Stemina obtained a license that is being paid over four years and cost "south of $100,000." Seay also argued that broad inventions deserve broad patents, citing a 1980 Stanford University patent on recombinant DNA that all biotech companies had to secure a license to until the patent expired.

For now, most panelists did not see the FDA as a major concern for hESCs, primarily because FDA approval is not required for most research tools. But Haider predicted more challenges as stem cells are used in patient treatment. He referenced a recent FDA ruling that cord blood banks in the U.S. adhere to certain standards and obtain a license. The move, he said, effectively bans cord blood shipped in from other countries and "creates a huge dilemma between complying with the law and saving patients," especially considering that only about one-third of leukemia patients who need a transplant actually will get one due to the difficulty in finding a match anywhere in the world.

As stem cells advance, this will just be "the tip of the iceberg," Haider said.

The BIO Mid-America Venture Forum ends today.