Stymied by federal restrictions on embryonic stem-cell research, U.S. institutions are increasingly taking matters into their own hands. This year the Harvard Stem Cell Institute, one of nine privately funded stem-cell research facilities in the nation, plans to raise $100 million for new research. Rutgers University, the Rockefeller University and the University of Wisconsin
have announced similar fund-raising campaigns.

Stem cells from young embryos can replicate indefinitely and give rise to any of 220 kinds of cells found in the body. Scientists say that such cells could yield treatments and cures for hundreds of diseases, including diabetes, cancer and Parkinson’s. The government ban–established in 2001 over ethical concerns about destroying embryos–limits federal funding to research involving about 60 human stem-cell colonies created before 2001. Yet most scientists argue that only about 16 of the lines are viable.

In response, the Harvard Stem Cell Institute, inaugurated last March, has generated 17 new embryonic stem-cell lines without a single federal dollar and has offered the lines free to scientists worldwide. This effort is already yielding astonishing results. Scientists at Advanced Cell Technology in Worcester, Massachusetts, reported in November that they had for the first time ever coaxed human embryonic stem cells, many from the
Harvard lines, into billions
of human retinal cells.

The cells, which are as functional as their natural counterparts, offer fresh hope for the estimated 30 million people worldwide suffering from age-related blindness. Cells from the government-sanctioned lines used in the same experiment “were reluctant to grow, even with heroic effort,” says lead researcher Robert Lanza. “It would be fair to say that this breakthrough would not have been made had we been limited to the federal lines.”But can private funding float the volume of research scientists say is necessary to realize stem cells’ promise? Those eager to build U.S. leadership in the field fear that they will be eclipsed by discoveries made abroad, where stem-cell science is unencumbered by controversy or funding limits. In October, for example, Israeli scientists repaired damaged pig hearts with injections of human embryonic stem cells, a big step toward the creation of biological pacemakers. And U.K. researchers are closing
in on a method to grow insulin-producing cells to treat diabetes.

With federal funds tapping out at $26 million annually, U.S. scientists say it’s impossible to keep up with advances overseas without more government support. To boost progress (and potential profits) at home, several states are following Harvard’s lead and pursuing funding initiatives of their own. As this article went to press, Californians were evenly divided over Prop 71, the ballot measure to approve $3 billion in bonds to finance stem-cell science in the state. New Jersey, New York, Illinois and other states are considering more modest initiatives.

Critics charge that such measures siphon money away from equally deserving fields into a relatively unproven area. The stem-cell panacea, they contend, is overhyped. Even scientists who advocate more funding admit openly that treatments are probably more than a decade away. But scientists such as Douglas Melton, co-director of the Harvard Stem Cell Institute, maintain that the risk of the research going belly-up is worth the potential gain. “If you have the mother of all cells that can make any part of the body–and people are suffering from disease–that alone is worth a lot of attention,” he says.