* U.S. appeals court overturns federal judge's ruling
* Obama supports funding in hopes it will cure diseases
(Adds NIH director, next steps, company comment)
By Jeremy Pelofsky
WASHINGTON, April 29 A U.S. appeals court ruled
on Friday the Obama administration can continue using federal
money to fund human embryonic stem cell research, a possible
avenue toward new treatments for many medical conditions.
The appeals court overturned a ruling by a federal judge
who found that the U.S. National Institutes of Health (NIH)
guidelines on such research violated the law because embryos
were destroyed and it put other researchers working with adult
stem cells at a disadvantage to win federal grants.
Opponents of human embryonic stem cell research, including
many religious conservatives, argue that it is unacceptable
because it destroys human embryos.
Such stem cells come from days-old human embryos and can
produce any type of cell in the body. Scientists hope to be
able to use them to address spinal cord injuries, cancer,
diabetes and diseases such as Alzheimer's and Parkinson's.
U.S. District Judge Royce Lamberth last August blocked the
taxpayer funding. His decision was put on hold pending appeal
so federal money continued to flow after the White House warned
research costing millions of dollars would be lost if halted.
A panel of three judges of the U.S. Court of Appeals for
the District of Columbia Circuit, all appointed by Republican
presidents, voted 2-1 to vacate Lamberth's injunction, saying
the challengers were unlikely to win on the merits.
The U.S. law was "ambiguous" and "did not prohibit funding
a research project in which an ESC (embryonic stem cell) will
be used," the majority opinion said.
"This is a momentous day -- not only for science, but for
the hopes of thousands of patients and their families who are
relying on NIH-funded scientists to pursue life-saving
discoveries and therapies that could come from stem cell
research," NIH Director Francis Collins said in a statement.
Shortly after taking office in 2009, President Barack Obama
expanded federal funding for research involving human embryonic
stem cells in hopes it would lead to cures for diseases.
In a bid to answer critics, Obama directed the NIH to come
up with an ethical process for paying for such research,
specifically that the embryos come from fertility clinics and
were going to be thrown away otherwise.
Since the appeals court ruling was on the injunction
Lamberth issued, the focus now turns back to his courtroom
where the two sides have been arguing over the specific merits
of whether the stem cell guidelines are legal.
The U.S. law on embryonic stem cell research funding
prohibits the NIH from funding the creation of human embryos
for research or the research in which a human embryo is
destroyed, leading the judges to argue over its true intent.
Judge Douglas Ginsburg, appointed by President Ronald
Reagan, wrote that it was "entirely reasonable" for the NIH to
interpret the law as "permitting funding for research using
cell lines derived without federal funding, even as it bars
funding for the derivation of additional lines."
In a dissenting opinion, Judge Karen LeCraft Henderson,
appointed by President George H.W. Bush, said the federal law
was clear about banning funding for human embryonic stem cell
research and that the court majority was engaging in
"linguistic jujitsu" to back it.
The case emerged from two researchers who opposed work with
embryonic stem cells and sued to block such funding. They
argued that they were at risk of being squeezed out of federal
grants for their own work with adult stem cells, which do not
involve the destruction of embryos.
The researchers, Dr. James Sherley, a biological engineer
at Boston Biomedical Research Institute, and Theresa Deisher,
of Washington-based AVM Biotechnology, could appeal the ruling
to the full appeals court, a lawyer involved in the case said.
Samuel Casey of the Law of Life Project, an attorney
involved in the challenge, said he was disappointed but not
surprised by the ruling, and was gratified that it was narrow.
Bernard Siegel, executive director of the Genetics Policy
Institute and founder of the Stem Cell Action Coalition, hailed
the decision as lifting a cloud of uncertainty over research.
"This case is not over by any stretch but this lifts the
cloud temporarily," he told Reuters. "This is still fundamental
research that needs to take place before we can advance it
fully and translate it into cures. For them to hold it back in
2010, 2011 and on into 2012 would be a travesty for patients."
Gary Rabin, chief executive of Advanced Cell Technology
ACTC.OB, which is developing treatments for two eye diseases
using embryonic stem cells and has gotten approval to begin
human clinical trials, praised the ruling.
"You're at the very beginning of what will ultimately be a
tidal wave of opportunities within the embryonic stem cell
community," he said. "We believe this is the first step for us
for ensuring that our cell lines will be fundable by the
(Additional reporting by James Vicini and Tabassum Zakaria
in Washington and Bill Berkrot in New York, editing by Will