Companies cheer Bush stem cell move

President Bush has given biotech firms cause for cheer

The biotechnology industry has welcomed US President George W Bush's decision to approve federal funding for certain types of stem cell research.

In a keenly-awaited announcement, President Bush said on Thursday that he would forbid federal funding for most research on discarded human embryos, but did not impose a complete ban.

The president's decision is a major step forward for patients and the biotechnology industry

Carl Feldbaum, Biotechnology Industry Association

"We are pleased that the president determined the need for this research to continue," said Carl Feldbaum, president of the Biotechnology Industry Association.

"Advances in stem cell research could impact the lives of millions of desperately ill Americans," he said.

"The president's decision is a major step forward for patients and the biotechnology industry."

Morality debate

President Bush's decision follows months of occasionally heated debate on the ethics of embryo research, with conservatives arguing that all stem cell research was fundamentally immoral.

Research on embryos is seen as the most promising area

Mr Bush was under huge pressure from conservatives to impose a ban on funding.

"This is the best that could have been asked for given the forces that surround this issue," said Mark Monane, an analyst at Needham & Co, an investment bank that specializes in biotechnology.

"It allows a degree of freedom to operate in this important area but at the same time is sensitive to groups who have differing views."

Companies cheer

Only a handful of US companies are involved in stem cell research on embryos, which is generally seen as more promising than research on adult stem cells.

Firms include Stemcells Inc, Geron and Aastrom Biosciences.

"I think it is a terrific decision - well thought out and very proactive," said Douglas Armstrong, chief executive of Aastrom Biosciences, whose shares rose by 26% ahead of the announcement.

But some firms said the decision was not as significant as last week's vote in the House of Representatives to ban cloning of embryos for therapeutic purposes.

Mr Feldbaum said that it might take five-10 years for researchers to develop the full potential of stem cell research.

"In the meantime, we must not allow the discussion of ethical issues or this valuable research to come to a halt," he said.