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Nexell Shares Keep Rising as Its Peers Take Hits

Biotechnology: The Irvine firm's stock continues surging after a ban on grants for embryo research ends.

August 27, 2000|From Dow Jones Newswires

Two days after a ban on federal grants for research on human embryo cells was lifted, shares of Irvine-based Nexell Therapeutics Inc. accelerated their gains Friday, defying the profit-taking that hit the company's peers.

Several companies involved in stem cell research, including StemCells Inc., Aastrom Biosciences Inc. and Geron Corp., watched their stock prices soar after the National Institutes of Health on Wednesday removed the long-standing ban on federal funding for research on stem cells from human fetal tissue.

Nexell's gains were more modest on Wednesday and Thursday, but on Friday its stock surged $1.75, or 18%, to $11.75 in Nasdaq trading.

Meanwhile, shares of Aastrom, which rose 59% Thursday, were down 13%, and those of StemCells had erased more than half of their 30% gain Thursday. After rising 24% Thursday, Geron shares retreated 6.2% Friday.

The removal of the ban seems to have little direct relevance to the businesses of Nexell and Aastrom, which are involved in research on adult, rather than embryonic, stem cells.

StemCells, which engages in research on embryonic stem cells, has no plans to take advantage of the new guidelines with grant proposals. Geron is also involved in researching embryonic stem cells.

"I think an impact it may have is it is elevating the interest in the science and research in this field," said Dennis Van Epps, director of research and development at Nexell.

Several investors have called Nexell inquiring about its involvement in stem cell research, spokesman Tad Heitmann said.

"We have been telling them that we are not currently engaged in embryonic stem cell research directly," he said, "but that the lifting of the ban signals the beginning of greater emphasis on adult and embryonic stem cell research."

Stem cells develop into the various, more specific, functional cells that make up the bodies of humans and other organisms.

Nexell makes technology to isolate, store and manipulate adult stem cells, primarily hemapoietic stem cells, which turn into the different types of cells that constitute blood.

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