“Venture guys are good at managing market risk,” said Gregory A. Bonfiglio, managing partner of Proteus Venture Partners. “Most don’t want to be in the business of managing political risk.”
A US appeals court earlier this month suspended the ban on federal funding for embryonic stem-cell research, but the extent that scientists can count on federal funding for these cells remains unclear, which is 1 reason most venture firms favor other approaches to regenerative medicine, such as adult stem cells or certain proteins.
- Recent events have spawned more doubt about whether scientists … will be able … to secure federal money to study embryonic stem cells, which can give rise to all types of cells in the body.
Funding restrictions for embryonic stem cells also hurts companies selling research tools to academic scientists, who rely heavily on grants. One company feeling the impact is Stemgent, whose products are used mostly to investigate pluripotent stem cells.
- But Stemgent also has technology targeting a newer field: induced pluripotent stem cells, or adult stem cells genetically reprogrammed to an embryonic stem cell-like state;
- Since these cells are not harvested from an embryo, they sidestep ethical concerns weighing on the embryonic stem-cell field;
- Stemgent, whose backers include HealthCare Ventures and Morgenthaler Ventures, is one of a few venture-funded businesses taking aim at this emerging market;
- Another is iPierian, which uses induced pluripotent cells, or iPS cells, to discover drugs. The process involves reprogramming adult cells from patients into a pluripotent state, then differentiating them into specific cell lineages that can be used in drug discovery. Kleiner Perkins Caufield & Byers is among its investors.
Also exploring the iPS field is ViaCyte, one of the few venture-backed companies with a embryonic stem cell-based product nearing clinical trials.
- ViaCyte hopes to free diabetes patients from regular insulin shots through an implant, derived from embryonic stem cells, that secretes insulin. In the future, iPS cells may enable ViaCyte – formerly Novocell – to develop a product without embryonic cells. For now, however, that is a distant goal. “We can make the whole product with embryonic stem cells and it could work well,” John West, CEO said. “The performance we’ve achieved with iPS cells is nowhere close to what we’ve achieved with embryonic stem cells.” (HWM and Brian Gormley, WSJ blogs)
Notice the title – did NOT say hESC stem cells!