President Obama Issues Executive Order on Embryonic Stem Cell Research — Policy Change Generates New Opportunities and Challenges

10 March 2009 Publication
Author(s): Gabor Garai Stephen B. Maebius David L. Rosen Sunit Talapatra Judith A. Waltz

Legal News Alert: Life Sciences

On March 9, 2009 President Barack Obama issued an Executive Order overturning the Bush administration’s policy restricting the use of public funds for research using embryonic stem cells created after Aug. 9, 2001. Under the Executive Order, the National Institutes of Health (NIH) will review existing guidance and issue new guidelines within 120 days that address the government’s funding of embryonic stem cell research. Scientists could then have an opportunity to apply for federal funds to support research activities using stem cells other than those defined by the Bush administration. In particular, this new Executive Order will provide scientists access to a greater, but as yet undetermined, number of embryonic stem cells and cell lines, many of which have become available in the period since the prior restrictions were implemented during the Bush administration.

This action has been welcomed by supporters, who maintain that this research will help lead to new therapies for diseases such as diabetes and Alzheimer’s, and new treatments for injuries such as those to the spinal cord. However, critics claim that the action could result in the creation and destruction of human embryos. During President Obama’s signing of the Executive Order, the president hoped that in reversing this long-standing policy, “Congress will act on a bipartisan basis to provide further support for this research.” Several bills to promote embryonic stem cell research have been reintroduced, and their sponsors are working to pass legislation this year that could be presented to the president for his signature. In the past, similar legislation had been passed by Congress only to be subsequently vetoed by President Bush.

Agency Funding Opportunities
In addition to these legislative efforts, we anticipate that the budgets for the U.S. Department of Health & Human Services (HHS), NIH, and other relevant appropriations for fiscal year 2010 will include significant funding for stem cell research activities. The current NIH funding levels proposed in the Omnibus Bill for the remaining fiscal year 2009 appropriations bills is more than $30 billion, which represents a $937 million increase over the prior fiscal year. There may be unique opportunities for stem cell research in this funding package.

Even more timely, perhaps, will be the $10.4 billion in funding for biomedical research recently included for NIH in the economic stimulus package. We expect that these funds may be utilized to support stem cell research in the private sector and at educational institutions throughout the United States, and could serve as the first major source of stem cell funding after issuance of the Executive Order.

Major Battle Looms
Finally, President Obama did not resolve one of the more difficult issues regarding stem cell research since the Executive Order does not address the prohibition on the government’s use of public funds to create human embryos for stem cell research or for research in which embryos “are destroyed, discarded, or knowingly [ ] subjected to risk of injury or death….” This ban known as the Dickey-Wicker amendment dates back to 1996, and prevents the allocation of federal funding for the actual creation of embryonic stem cell lines. However, it does permit the use of federal funds for research on those stem cells once they have been created. Supporters of stem cell research legislation have indicated that they are likely to seek reconsideration or repeal of Dickey-Wicker, while opponents of federal funding for stem cell research have stated that they will vehemently oppose any such effort.

A Look Ahead
Undoubtedly, research labs and facilities throughout the United States are bracing for this “sea change” in the government’s policy on stem cell research funding. Although the issuance of the Executive Order is an important first step in expanding the federal government’s support of stem cell research, the forthcoming NIH regulations and corresponding congressional debates also will have a dramatic impact on the direction of stem cell research activities in both the near and long term. We will be following these developments closely and will provide further follow-on updates.

Legal News Alert is part of our ongoing commitment to providing up-to-the-minute information about pressing concerns or industry issues affecting our clients and our colleagues. If you have any questions about this update or would like to discuss this topic further, please contact your Foley attorney or the following:

Jeffrey S. Newman
Partner, Government Procurement Practice
Washington, D.C.

Robert C. Geist, Jr.
Director, Public Affairs Practice
Washington, D.C.

Stephen B. Maebius
Co-Chair, Life Sciences Industry Team
Washington, D.C.

Gabor Garai
Co-Chair, Life Sciences Industry Team
Boston, Massachusetts

David L. Rosen
Co-Chair, Life Sciences Industry Team
Washington, D.C.

Judith A. Waltz
Co-Chair, Life Sciences Industry Team
San Francisco, California

Sunit Talapatra
Associate, Intellectual Property Department
Washington, D.C.