Stem cell research loan underwriting starts in California

The California Institute for Regenerative Medicine has announced plans to underwrite loans to US biotechnology firms engaged in human stem cell research, according to the San Diego Union-Tribune. The $3.0 billion program, which was approved by a popular vote in the USA's most populated state in 2004, is designed to assist firms that are unable to raise capital for stem cell-related research, due to political and activist pressure by opponents.

Several reasons have been advanced for the difficulty in securing funding for research in this area. Some venture capitalists simply consider that the science is at too early a stage to be viable for large-scale investments. However, Alan Lewis, chief executive of Novocell, which is active in embryonic stem cell R&D, says that major drug firms are reluctant for political reasons to make visible commitments.

Federal government funding of human embryonic stem cell research is prohibited, with the current President, George W Bush, having vetoed two attempts by Congress to reverse the ban (Marketletters passim). Although the next US President could change the federal government's policy, in the meantime, initiatives such as the CIRM are attempting to plug the gap.