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University of Pittsburgh researchers have discovered what could be the ultimate prize in biomedicine -- cells that behave like embryonic stem cells but don't raise confounding ethical questions.

These cells -- called amniotic epithelial cells -- share many of the characteristics that make embryonic stem cells so highly coveted, such as the capacity to become cells for other body tissues and organs and to make copies of themselves, according to Stephen Strom, an associate professor of cellular and molecular pathology at Pitt.

Unlike embryonic stem cells, their harvest doesn't require the destruction of human embryos.

Amniotic epithelial cells can be collected after full-term childbirth from the placenta's amnion, a thin cavity filled with fluid that forms eight days after fertilization to cushion the fetus, Strom said.

This means placentas usually dumped in the trash as medical waste could represent a nearly limitless source of "stem cell-like" cells for treating conditions such as liver and heart disease and diabetes, said Strom, who serves on the faculty of the university's McGowan Institute of Regenerative Medicine.

"If one could take something that is normally thrown away and use it for regenerative medicine, that's the ultimate in recycling," Strom said. "We're stupid people who may have been throwing out the baby -- this tremendous source of stem cells -- with the bath water for years and years."

More than 4 million live births occur in America each year, according to U.S. Census figures. For each placenta, the researchers calculate there are about 300 million amniotic epithelial cells that easily could be multiplied to 10 billion and 60 billion cells.

"Certainly a lot of tissue gets discarded at the time of delivery that may harbor different stem cell populations," said stem cell expert Dr. Jay Kolls, of Children's Hospital of Pittsburgh, who wasn't part of this study. "Having this kind of resource for future research is important."

Kolls cautioned, though, that our knowledge of the therapeutic potential of amniotic epithelial cells is far from complete.

"Right now the data are just in (a laboratory dish)," he said. "The real question will be" examinations in living organisms.

The findings of Strom and fellow investigator Dr. Toshio Miki, a Pitt pathology instructor, are published in today's issue of the journal Stem Cells. Other authors of the paper include Pitt researchers Thomas Lehmann, Hongbo Cai and Donna Stolz.

Their work was paid for by grants from the Alpha-1 Foundation and the National Institute of Diabetes and Digestive and Kidney Diseases, part of the National Institutes of Health.

Miki wasn't available for comment yesterday because he was accompanying his wife to the hospital for the delivery of their second child. As a sign of faith in the promise of their research, Strom said, his colleague plans on stripping the amnion off the baby's placenta and banking it in case the epithelial cells come in handy in the future.

Strom and Miki began looking to the amnion in 2001 as a possible source of nonembryonic cells, which could be used to generate healthy liver cells to transplant into people suffering from liver disease.

To their surprise, they found that amniotic epithelial cells not only could become liver cells, but also turned on many of the same telltale genes as embryonic stem cells.

Embryonic stem cells are unprogrammed cells with the capacity to become cells for virtually all body tissues and organs. They also can make copies of themselves indefinitely.

"Everyone thought embryonic stem cells have these characteristics, and other cells don't, so we thought we probably had the wrong answers," Strom said.

Moreover, the amnion-derived cells isolated by Strom and Miki produced copies of two critical genes that are required for embryonic stem cells to develop into any type of cell. With the addition of various growth factors, the researchers showed that the cells from the placenta could be transformed into liver, heart, nerve and pancreatic cells.

Despite similarities to embryonic stem cells, the amnion-derived cells are not "stem cells" by definition because they can't multiply indefinitely because they lack a key enzyme called telomerase.

That could be an advantage because there's little concern these cells could cause cancer -- a major, potential drawback of embryonic stem cells, Strom said.

"These cells are absolutely nontumorigenic, readily available and noncontroversial," Strom said.

The patent-pending technology underlying amniotic epithelial cells was licensed by Pitt in 2002 to a Hazelwood-based company now called Stemnion Inc., formerly Kytaron Technologies Inc.

A biotechnology startup that employs seven scientists and several administrators, Stemnion was formed in January 2004 with seed money from the venture capital fund Lancet Capital.

Medical records company Stentor, which grew out of an idea from a Pitt radiologist through support from Lancet Capital, was sold last month to Dutch electronics giant Philips for $280 million.

Stemnion, one of the fund's latest investments, is seeking to develop cellular therapies for diabetes, liver disease and wound healing using the amnion-derived epithelial cells, said Stemnion CEO and Lancet Capital director George Sing.

"Not only are these cells not controversial, they are very abundant and it would appear they do not form tumors in animal models," Sing said. "All of these things bode very well from a commercialization standpoint."

Stemnion officials would not discuss advances with amnion epithelial cells made beyond the study that was published today, but they are probably years away from having a sellable product, Sing said.

"We're hoping to get more funding to accelerate and expand our work," Sing said. "If we succeed, it will be a monstrous company."

Strom and Miki are now taking their science from the petri dish to animals by investigating what happens when amnion-derived stem cells are injected into mouse livers, which is the first step toward human trials.

"If we could identify that these cells restore liver function in mice, the (U.S. Food and Drug Administration) might let us move fairly quickly to the clinics," Strom said.

Both researchers serve as paid consultants and have stakes in Stemnion.

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