West Coast Editor

Shares of Stem Cells Inc. jumped 12.2 percent on news of a published study showing the firm's neural stem cells restored function in paralyzed mice, which is the first research to establish a causal link between the transplanted cells and recovery of long-term motor ability.

Company officials couldn't be reached, but the Palo Alto, Calif.-based firm's stock (NASDAQ:STEM) closed Tuesday at $5.53, up 60 cents.

When the cells were taken out of some of the mice, their previously improved motor function was lost. The study was conducted at the Reeve Irvine Research Center at the University of California at Irvine and published online Tuesday in the early edition of the Proceedings of the National Academy of Sciences. The work will appear in the Sept. 27, 2005, print issue.

In the experiment, human neural stem cells were transplanted into mice nine days after a spinal cord crush injury that resulted in hind-limb paralysis. The mice were then watched and tested for 16 weeks after the transplant, and showed significant improvement in their ability to walk compared to mice in two control groups, a benefit that persisted during the full term of the study.

Treated mice had better weight-bearing ability and coordinated stepping using their hind limbs, and data gathered during the study shows the neural stem cells survived, produced new neural cells that integrated into the mouse spinal cord and reversed hind-limb paralysis.

Specifically, the neural cells transplanted into the mouse spinal cord become specialized new cells called oligodendrocytes that make myelin, which forms the myelin sheath that insulates nerve fibers. The newly formed oligodendrocytes not only made new myelin sheaths around damaged mouse axons, but also new human neurons were generated that were shown to form synapses.

The study is likely to be carefully weighed in the days to come. News of progress in mice has caused a major stir before, notably in 1998 when Rockville, Md.-based Entremed Inc.'s stock quadrupled after a feature in The New York Times highlighted the company's progress in rodents with angiogenesis inhibitors. (See BioWorld Today, May 5, 1998.)

Farther back, Centocor Inc., of Malvern, Pa., once had positive results in mice afflicted with medicine's big-time bugaboo, sepsis - which many other firms also have tried, and are trying, to tackle - but the work did not translate well to humans.

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