INTRODUCTION

  The Prime Minister in his speech to the Royal Society on 3 November 2006 said that "I am glad to say that the UK biotechnology sector remains the most successful in Europe and is second globally only to the US". He has also said previously "Biotechnology is the next wave of the knowledge economy, and I want Britain to be its European hub".

  2.  The realisation of the Prime Minister's vision is dependent upon a regulatory environment in the UK that promotes innovation by both industry and the academic research base. Accordingly, DTI is keen that regulation supports and encourages both universities and companies to remain at the leading edge in the particularly important area of stem cell research and development.

  3.  The strength of our current regulation is that it balances both the opportunities for advancement of the science underpinning improvements in health care with consideration for ethical implications. Both objectives must continue to be met.

GOVERNMENT SUPPORT FOR STEM CELL RESEARCH

  4.  The UK permits and supports financially stem cell research using cells from all sources—adult, foetal, and embryonic. As a result, the UK has been at the forefront of stem cell research for a number of years. Key advances such as nuclear transfer have been developed in the UK, and the Government's objective is that the UK retains its position as a world leader in stem cell research. The 2005 Budget announced the launch of a UK Stem Cell Initiative (UKSCI) to help shape the future of stem cell research in the UK.

  5.  The UK Stem Cell Initiative (UKSCI) was a high-level review, chaired by Sir John Pattison, and included the Wellcome Trust, MRC, BBSRC, DTI, DH and the UK Stem Cell Foundation. The UKSCI report, published in December 2005, provides a clear vision for maintaining the UK's position as a world leader in stem cell research, and provides a pathway to translate this research into new therapies to benefit patients.

  6.  The Government accepted the recommendations in the report, which have been used to inform the development of the UK's investment and regulatory strategy for stem cell research. The Government announced that £100 million will be made available for UK stem cell research over the 2006-08 period through its funding of Research Councils, DTI Technology Programmes, the NHS R&D programmes and Regional Development Agencies. Although the exact amount the Research Councils will spend on stem cell research in this period will depend on the number of high quality applications received, it is anticipated that this will be in the order of £50 million.

  7.  The implementation of the recommendations from the UKSCI is progressing well. Funding for the Stem Cell Bank has been agreed and the Stem Cell Network established. A task force led by the Association of the British Pharmaceutical Industry has backed the recommendation to establish a Public Private Partnership. The Government will work in partnership with industry to establish a consortium which will develop the use of stem cells in the production of safer medicines, and begin work with a series of pilot projects in 2007.

  8.  The UK Stem Cell Bank is responsible for storing, characterising and supplying ethically approved, quality controlled stem cell lines for research and ultimately for treatment The Bank relies on researchers producing new stem cell lines. Much of the stem cell research being carried out in the UK relates to understanding stem cells themselves and understanding the production of stem cell lines, which will lead to better techniques and research tools. Many researchers consider that this type of research may benefit from the use of hybrid stem cells.

SUPPORT FOR INDUSTRY

  9.  There is a very strong commercial interest in the applications of stem cell research, in particular for regenerative medicine. This is reflected in the high level of support for industry-driven R&D awarded through the Government's Technology Programme. This Programme is investing directly in new and emerging technologies, and has been designed to help businesses work collaboratively with each other or with academic partners to develop technologies that will underpin products and services of the future. Nine major industry-led projects developing stem cell technology with a total value of £17 million, which are taking forward various aspects of stem cell research to clinical translation and commercial exploitation, are currently being supported with public funding from DTI and the Research Councils of over £10 million. Thirteen companies are participating in these projects, which cover a range of potential applications of stem cell research such as:

—  Therapeutic stem cells for neurology applications (eg Parkinson's Disease);

—  Delivering differentiated cells for therapeutics and screening applications, focusing on bone, lung and liver cells;

—  Developing a system for producing dermal stem cells in commercial quantities for wound healing, particularly the treatment of large area burns;

—  Creating a cardiovascular stent with a stem-cell derived coating.

  10.  DTI has also provided other support for the commercial exploitation of stem cell technology, including:

—  Stem cell-derived products for therapeutic purposes are classed as "cell-based therapies". DTI's discussions with industry and researchers developing cell-based therapies indicated that guidance on relevant regulations and Codes of Practice for this area—from research lab to clinical translation—would be useful. A guidance document was commissioned from BSI and published in November 2006[70] identifying relevant regulations, codes of practice and standardised methods and linking them to the lifecycle of cell based therapy product production.

—  Overseas missions for UK stem cell companies to North America, Asia and Australia to identify key developments, benchmark UK industry and establish contacts with overseas players have also been supported over the past few years.

  11.  In January the Scottish Executive announced a £59 million investment in a Scottish Centre for Regenerative Medicine (SCRM) at Edinburgh University. This will bring basic scientific research, clinical development and commercial application together in one building and provide state-of-the-art research facilities, manufacturing capacity and commercialisation facilities.

  12.  The Government's support for stem cell research and the UK's current regulatory framework have encouraged inward R&D investment in UK. For example, Cellartis, a Swedish Company, has recently announced it will be setting up a development and manufacturing facility for stem cell technology in Dundee with the creation of 75 new jobs and investment of £9.5 million in the UK.  The attractiveness of inward investment will diminish if the UK is not able to offer the most relevant and internationally competitive research under a clear and up to date regulatory framework.

PUBLIC DIALOGUE ON STEM CELLS RESEARCH

  13.  The Research Councils are working with the DTI's Sciencewise initiative on a programme of public dialogue and engagement on stem cell research. The Chief Executives of both MRC and BBSRC have agreed to lead a public dialogue on stem cell research under an RCUK umbrella and supported by a DTI grant. This will:

—  shape public expectations about the opportunities offered by stem cells;

—  enable scientists to understand public values and ethics related to stem cell research and use;

—  involve key organisations, such as the UK Stem Cell Network, the UK Stem Cell Communications Coalition and the emerging stem cell "club"; and

—  produce a plan for a longer-term programme of public dialogue, engagement and social research around stem cells.

HYBRID STEM CELLS

  14.  The use of hybrid embryos potentially provides a valuable new source of the material needed if stem cell research is to continue to move forward. Hybrids could potentially contribute to drug development particularly in areas such degenerative diseases where the global market is enormous. They could also enhance the potential of stem cells to be used in toxicity testing. In addition hybrids will provide a valuable resource for research into degenerative diseases, where relatively large quantities of stem cells will be required, and where the current shortage of good quality human embryos is restricting research. The use of hybrid embryos may in addition speed up testing the capacity of embryonic stem cells to differentiate into a range of bodily cell types as part of research into the treatment of serious disease. The joint MRC/Wellcome Trust submission (published as memorandum 35) to the Committee on this issue puts forward a strong analysis of the scientific case for the use of hybrid stem cells in research, and DTI endorses that submission.

  15.  DTI has received strong views from industry that a regulatory ban on the use of hybrids for research may harm the climate for both company and academic research, This may damage the widespread international view that the UK has one of the best regulatory systems in relation to stem cell research.

  16.  DTI supports the view that, with appropriate regulation, the creation of hybrid stem cells for research purposes should be permitted.

February 2007