Reversal of Stem Cell Research Ban: 13 Stocks to Benefit

Earlier this week President Obama signed an executive order lifting the ban on federal funding for embryonic stem-cell research. In his speech made to the American people, he explained that scientific decisions must be “based on facts, not ideology.”

Back in 2001, President Bush moved to restrict federal funding for human embryonic stem cell research, making it the subject of his first prime-time televised speech from the White House. Now, Obama has flipped the tables with one swipe of the pen, a prospect that pleases many Democrats in the Congress. "Signing this executive order sends a clear signal around the world that our nation supports research based on science, not politics," said Rep. Jim Langevin of Rhode Island, a strong backer of stem cell research.

While the Left argue that stem-cell research offers hope for millions of people suffering with debilitating conditions, right-to-life groups hotly oppose this move by the President because they equate it to murder.

This is clearly a very controversial topic. But for the time being, President Obama’s reversal this week of President Bush’s anti-embryonic stem cell policy has turned to the side of science and medicine. And while there is considerable uncertainty as to the ultimate benefits from embryonic stem-cells, companies involved in this research are going to clearly reap the benefits of this change in leadership and policy for at least the next four years.

There are only a limited number of stocks which are pure plays or semi-pure plays in the stem cell industry. However, with the reversal of this ban, this could become a very huge industry. The following list includes stocks that investors should keep on their radars.

Aastrom Biosciences (ASTM) - Aastrom Biosciences is involved in the development of cell products for the regeneration or repair of human tissues, based on its proprietary Tissue Repair Cell [TRC] technology.

Advanced Cell Technology (ACTC) - ACTC is involved in the development and marketing of human stem cell technology in the area of regenerative medicine and stem cell therapy.

Alexion Pharmaceuticals (ALXN) - Alexion Pharmaceuticals is involved in the development of biologic therapeutic products for the treatment of hematologic and cardiovascular disorders, autoimmune diseases, and cancer.

ARIAD Pharmaceuticals (ARIA) - Ariad is involved in the development of medicines for the treatment of cancer by regulating cell signaling with small molecules. Their cancer products are used to treat sarcomas, hormone refractory prostate cancer, and endometrial cancer.

BioTime, Inc. (BTIM) - BioTime develops blood plasma volume expanders and blood replacement solutions for hypothermic (low temperature) surgery, and organ preservation solutions and technology for use in surgery, emergency trauma treatment, and other applications.

Celera Group (CRA) - This NYSE company, founded in 1937, is involved in the discovery and validation of new diagnostic markers, using proprietary genomics and proteomics discovery platforms and diagnostic products based on those markers.

Cellgene (CELG) - Cellgene is involved in the discovery, production, and marketing of therapies designed to treat cancer and immune-inflammatory-related diseases. Their primary product includes THALOMID, for the treatment of erythema nodosum leprosum. Last year, the company received patent on placental stem cell recovery.

Cord Blood America Inc. (CBAI) - CBAI provides private cord blood stem cell preservation services to families in the United States. The company also engages in the collection, testing, processing, and preservation of peripheral blood and adipose tissue stem cells, which allows individuals to privately preserve their stem cells for potential future use in stem cell therapy.

Dendreon Corporation (DNDN) - This company is involved in the discovery, development, and marketing of active immunotherapies, monoclonal antibodies, and small molecule product candidates to treat cancer. They manufacture the DACSÒSC stem cell enrichment device.

Geron (GERN) - This Menlo Park, California company develops cell-based therapies derived from human embryonic stem cell platforms for treatment of various diseases.

Integra Lifesciences Holdings (IART) - Integra develops, manufactures, and sells medical devices, implants, biomaterials, and instruments to the neurosurgery, surgery, and soft tissue repair markets.

Invitrogen Corporation (IVGN) - Invitrogen sells products and services which support academic and government research institutions, pharmaceutical companies and biotechnology companies, including tools for gene acquisition, gene cloning, gene expression,

StemCells Inc. (STEM) - This Palo Alto company is involved in the discovery and development of adult stem cell therapeutics for treating damage to the central nervous system, liver, and pancreas.

Disclosure: no positions

Comments

[Steven Hansen:]

under bush, America has given up an 8 year research lead to asia and europe. i would welcome an article quantifying how behind we are.

Mar 12 04:44 AM

[stox:]

The only stem cell stock worth investing is Thermogenesis (KOOL) and actually an excellent investment for years to come, why?

Not like all the R&D shops with no product or revenue but loss and dilution. KOOL is the only viable supplier of tools and equipments for stem cells processing and preservation from cord blood and bone marrow.

Actually, it's about to achieve sustainable profitability from its cord blood processing and preservation business, KOOL is entering high growth period with its new line of clinical devices called Res-Q's for stem cells and PRP in human and veterinary hospitals.

The only stem cell related company to achive operation profitability within 2 quarters.

Mar 12 06:08 AM

[rlwinvestor:]

This list is a little too broad. Really there are are only 3 companies that "directly" benefit from the ban: GERN, ACT.PK, and BTIM. The actual benefits are discussed with more depth in the latest post on tradingstemcells2009.b... .

Mar 12 09:35 AM

[cposch:]

Will someone tell this author to do his homework and stop pumping Ariad Pharma. This stock is not a stem-cell stock, but merely a company with a history of massive losses from a CEO who was runner up for "Worst Biotech CEO of 2008."

Mar 12 10:31 AM

[PeteK:]

Stem-cell research maybe just a way of wasting taxpayers' money after all. So far heard nothing exciting about it.
This has been talks for over 20 years.

Mar 13 02:41 AM

[Mr. Ed, Jr.:]

By bringing it up 3 times in the first 4 paragraphs, I must assume the author felt a real compulsion to get his political viewpoint drummed into our heads;

...he (Obama) explained that scientific decisions must be “based on facts, not ideology.”

"...our nation supports research based on science, not politics,"

"President Obama’s reversal this week of President Bush’s anti-embryonic stem cell policy has turned to the side of science and medicine"

Of course, if the standard is "facts, not ideology", the author would have noted that President Bush did not ban stem cell research, only Federal funding for it.

President Obama has decreed that no funds be used for human cloning. Is that preventing "research based on science, not politics" ?

Many nations place limits on areas of scientific research for moral reasons, and those reasons/limitations will vary depending on who is in power at the time.

I support President Obama's decision, but I wish the writers at SA would try to maintain some self-control-- one mention of the political viewpoint was more than enough, I think.

Mar 13 03:32 AM

[John Cordes:]

KOOL Thermogenics, little debt, cash flow, specialty service and equipement to stem cell industry, with unique products and long term expertise. It's not neccessary to guess which bio-tech/stem cell company will break out, they all use Thermogenic products.

Mar 13 09:31 AM

[Titus Andro...:]

I wouldn't hold my breath. Don't waste a whole lot of money on this gamble. I bought in to the hype with gern at $6 and I'm not expecting anything for a long time. I will die with gern in my portfolio. I'm looking at it as a rough night at atlantic city. Oh well time will tell. Anybody know why gern was up to $70 back in 2000?

Apr 08 04:59 PM

[kool:]

KOOL is the one to own now, a 5-10 bagger in a year or so, in my humble opinion.

Jul 29 08:10 PM