On March 9, 2009, President Obama signed Executive Order 13505, allowing federal funding of human embryonic stem cell (hESC) research. The order removes restrictions imposed by former President Bush on August 9, 2001, and will allow the National Institutes of Health (NIH) to become a major new source of funding for hESC research. By signaling the Obama administration’s support for this research, the order may also be a catalyst for new investment and innovation in this area, which holds enormous growth potential.
That potential will be affected by the policies that the administration adopts for implementing the President’s order, and for interpreting, or modifying, the existing laws and regulations governing the development and ultimate marketing of hESC products. Also impacting hESC progress in this country will be how successfully United States companies employ a global strategy, utilizing the resources available from international players and anticipating the requirements for marketing their products in foreign countries. Thus, funding for, regulation of, and international approaches to the development of hESC products raise important policy and legal issues.
President Bush’s policy allowed federal funding of hESC research only with respect to a limited number of specified hESC lines in existence at the time the policy was issued. The new executive order lifts this restriction, and announces that it is the policy of the Obama administration to “expand NIH support for the exploration of human stem cell research.” The order states that NIH may support and conduct “responsible, scientifically worthy human stem cell research, including human embryonic stem cell research, to the extent permitted by law.” The order further directs the Secretary of the Department of Health and Human Services (HHS), through NIH, to issue new guidance on human stem cell research, based on “other widely recognized guidelines on human stem cell research, including provisions establishing appropriate safeguards.” The NIH guidance is to be issued within 120 days from the date of the order, or by July 7. There are indications that NIH may issue the guidance sooner.
Even after confirmation of a Secretary of the HHS and Director of NIH, it will be difficult to predict the precise scope or specifics of the guidelines that will be developed. Among the "other widely recognized guidelines" the NIH likely will base its guidance are the National Academies' Guidelines for Human Embryonic Stem Cell Research and the 2007 Amendments to those guidelines. NIH's approach could be further informed by legislation that has been introduced in Congress, H.R. 873, which specifically authorizes federal funding of research on hESC lines derived from donated human embryos originally created for the purpose of infertility treatment but no longer needed for that purpose. One issue NIH is likely to consider is whether to permit funding of research involving stem cell lines derived from other embryos, such as those created through somatic cell nuclear transfer.
Regardless of the exact parameters of the NIH guidance, the executive order will have two major consequences for institutions that are involved in hESC research. The first, most obvious, and most important consequence is that NIH will soon, for the first time, be a major new source of funding for hESC research. It may be assumed that this funding will not actually become available until the NIH guidance on human stem cell research has been issued this summer, and if grant applications for hESC research are not even invited or accepted until after that guidance is in place, the release of NIH hESC research funding may not occur until the end of 2009 or later. It is uncertain how much of the new NIH research funding made available under the federal government’s stimulus legislation will be used to support hESC research, because NIH has announced that it intends to use that funding primarily to fund research proposals that were previously submitted to NIH but not funded. Few if any of those proposals would have been for hESC research. There is little question, however, that the President’s executive order will in fairly short order result in very significant NIH support for hESC research. NIH is highly motivated to make that happen, as is the Obama administration.
The second consequence of the executive order is less significant, but it will be essentially immediate and will be warmly welcomed by research institutions engaged in hESC research. Since President Bush’s stem cell policy was first announced almost eight years ago, many research institutions have gone to enormous trouble and expense to segregate their hESC research activities (funded by non-federal sources) from their federally-funded research activities. They have done so out of a concern that any intermingling of federally funded research activity with hESC research funded by non-federal sources might be viewed as a form of partial federal funding of hESC research, in violation of the Bush administration’s policy. At some institutions, equipment purchased under federal grants has been specially marked to ensure that it is never used in hESC research, even though, in general, federal rules would permit it to be used on non-federal projects. Completely separate supply rooms have been set up at some institutions to keep hESC supplies and federal supplies segregated. In some instances institutions have taken pains to avoid conducting hESC research in buildings that were constructed or renovated in whole or in part with federal funds. A few institutions have gone so far as to create virtual hESC research institutes, walled off physically, administratively and financially from other institutional research activity. Needless to say, these administrative and accounting “firewalls” have resulted in a great amount of needless expense and inconvenience, and have adversely affected the quality of both federal and hESC research. There appears to be no good reason why these firewalls may not now be dismantled.
The new opportunities in hESC research and development will bring renewed attention to how the U.S. Food and Drug Administration (FDA) regulates hESCs, as well as other stem cells and cellular products in general. Two distinct regulatory pathways currently exist for bringing human cells, tissues, or cellular or tissue-based products (HCT/Ps) to market, one that requires pre-approval from the FDA and one that does not. Which pathway is permitted depends on a series of regulatory tests involving the nature of the products and how they are intended to be used. Effective research and development must consider which pathway and regulations will apply to the ultimate product.
The regulatory status of cellular products used for therapeutic or prophylactic purposes was formally addressed by the FDA in a notice issued in 1993. 1 A previous Intercenter Agreement between the Center for Biologics Evaluation and Research (CBER) and the Center for Drug Evaluation and Research (CDER) indicated that CBER would have regulatory jurisdiction for cellular-based products.2 These initiatives led to a number of guidances pertaining to cellular products.3
Later, in March 1997, the FDA proposed a comprehensive, more detailed plan for the regulation of cells and collections of cells in the form of tissues. This plan, which is codified in the Code of Federal Regulations (CFR), title 21, Part 1271, mentions hematopoietic stem/progenitor cells derived from peripheral and cord blood as examples of HCT/Ps, but neither specifically listed nor exempted hESCs. Part 1271 divides HCT/Ps into two basic categories, those that are regulated as biological drugs under section 351 of the PHS Act (PHSA) (codified at 42 USC §262) requiring premarket clearances and those that are regulated solely under section 361 of the PHSA (codified at 42 USC §264), and do not require premarket clearances.
Section 361 provides authority to the FDA to issue regulations to prevent the spread of communicable diseases, which is the authority on which the FDA relied to promulgate title 21, Part 1271. Under those regulations, HCT/Ps must meet requirements involving product registration and listing, donor eligibility criteria, good tissue practice provisions, and reporting and inspection, but are not subject to FDA premarket clearances. HCT/Ps that also qualify as biological drugs, on the other hand, must satisfy all the requirements for biological drugs, including licensure under section 351 of the Public Health Service Act, in addition to satisfying the requirements in Part 1271.
Thus, how stem cells are classified will make a significant difference in how they ultimately are regulated. Regulatory criteria used to make the classification include whether the cells are more than minimally manipulated such that the characteristics of the cellular population have changed. Examples of “more than minimal manipulation” include cell expansion, encapsulation, activation, or genetic modification, but not cell selection.
Another prerequisite to an HCT/P qualifying to be regulated solely under section 361 is that it must be intended for “homologous” use only, as reflected in the labeling, advertising, or other indications of the manufacturer’s objective intent. Homologous use is defined as the repair, reconstruction, replacement, or supplementation of a recipient’s cells or tissues with an HCT/P that performs the same basic function or functions in the recipient as in the donor. Whether hESCs can meet that definition is not entirely clear. On one hand, because the basic function of the recipient’s own embryonic stem cells is to become any cell in the body, an argument could be made that using a hESC to transform into any particular cell in the body is performing the same basic function, and therefore is a homologous use. On the other hand, the basic function of the recipient’s embryonic stem cells is to create not just one particular type of cell, but all the cells in the body. Consequently, using hESCs to replace only one particular cell type might not be viewed as truly homologous.
Another factor in classifying an HCT/P is that if it has a systemic effect or is dependent upon metabolic activity of living cells as its primary function and is for autologous use, allogeneic use in first degree or second degree blood relatives, or for reproductive use, it might not be regulated as a biological drug, depending on its other characteristics and handling procedures. Because of the variety of uses and sources of stem cells, including hESCs, these provisions will continue to present interesting and challenging interpretative questions and other issues. Keeping apprised of these regulatory developments and interpretations will be important in ensuring that research and development of hESCs and all stem cell products will result in products that will be able to be brought to the patients who need them.
Executive Order 13505 is significant not only for hESC research conducted in the United States, but also for such research conducted globally. In the coming months and years, United States companies and universities will be well placed to collaborate with their counterparts in countries that permit hESC research – notably the United Kingdom – in the hope of gaining regulatory approval to bring hESC therapies to market.
The United Kingdom is one of a small minority of EU member states that permit hESC research, as public opposition elsewhere in the European Union has prevented similar permissive laws from entering into force. Subject to certain restrictions, the United Kingdom has permitted hESC research using a wide range of experimental procedures since 1991, under the authority of the Human Embryology and Fertilization Act 1990 (the Act), and as recently amended by the Human Embryology and Fertilization Act 2008.
Although hESC laws in member states are not harmonized at the EU level, hESC research projects in the United Kingdom may be eligible to receive EU funding under the Seventh Framework Program of the European Community, provided that the research is not in contravention of UK law, and is not aimed at: (i) human cloning for reproductive purposes; (ii) modifying the inherited genome of humans; or (iii) creating human embryos solely for the purpose of research or stem cell derivation.
Before carrying out hESC research in the United Kingdom, the research must first be covered by a license granted by the Human Fertilization and Embryology Authority (HFEA) License Committee. Once cells have been isolated from human embryos, the development of a product using such cells is then governed by the Human Tissue Authority in its role as statutory regulator under the Human Tissue (Quality and Safety) Regulations 2007, until the product is classified as an Investigational Medicinal Product by the Medicines and Healthcare products Regulatory Agency (MHRA). Following this classification, the MHRA retains the authority to grant manufacturing, clinical trial, and marketing approval to the product. To date, no hESC therapy has received marketing approval in the United Kingdom. However, one company based in England has recently been awarded the first in-man clinical trial approval by the MHRA for a neural stem cell derived product and it is expected that the study will begin shortly.
Although the jurisdiction of the Act and the HFEA in governing hESC research has been the subject of repeated challenges in the UK courts, the United Kingdom’s stance in permitting hESC research has not changed materially since the original implementation of the Act. In fact, despite the inherent controversy, the 2008 amendment has actually broadened the scope of hESC research to include, among other new procedures, research on embryos created from the transplantation of human nuclei into animal eggs (so long as such embryos are created by nuclear transplantation). The 2008 amendment is expected to endure as it was the culmination of a lengthy and complex public and scientific consultation period.
The rapid advances in our understanding of hESC biology and the key questions surrounding the application of both federal funding and regulatory pathways to hESC research projects in the United States will continue to generate challenges from a legislative and policy perspective. In light of recent events, the United States may look towards the pioneering approach of the UK regime as a model on which the United States could base its own developing framework.