Order Code RS21044
Updated October 26, 2004
CRS Report for Congress
Received through the CRS Web
Background and Legal Issues Related to
Stem Cell Research
Jon O. Shimabukuro
Legislative Attorney
American Law Division
Summary
With certain restrictions, the President has announced that federal funds may be
used to conduct research on human embryonic stem cells. Federal research is limited
to “the more than 60” existing stem cell lines that were derived (1) with the informed
consent of the donors; (2) from excess embryos created solely for reproductive purposes;
and (3) without any financial inducements to the donors. No federal funds will be used
for the derivation or use of stem cell lines derived from newly destroyed embryos; the
creation of any human embryos for research purposes; or cloning of human embryos for
any purposes.
Human Embryonic Stem Cells. Human embryonic stem cells are “master
cells,” able to develop into almost any cell in the human body. Building on earlier stem
cell research, in 1998, researchers at the University of Wisconsin isolated cells from the
inner cell mass of the early human embryo, called the blastocyst, and developed the first
human embryonic stem cell lines.1 Research has focused on the potential that these cells
can offer to treat or mitigate diseases and conditions and to generate replacement tissues
for disfunctioning cells or organs.2 Research efforts have focused on spinal cord injury,
multiple sclerosis, Parkinson’s disease, Alzheimer’s disease, diabetes, and other diseases
or conditions. Scientists hope to use specialized cells to replace dysfunctional cells in the
brain, spinal cord, pancreas, and other organs.3 The sources for stem cells include: one
week old embryos (blastocysts) created via in vitro fertilization (IVF) to treat infertility;
five to nine week old embryos or fetuses obtained through elective abortion; embryos
created through IVF for research purposes; embryos created through cloning or somatic
1 Nat’l Inst. of Health, U.S. Dep’t of Health & Hum. Services, Stem Cells: Scientific Progress and
Future Research Directions 4 (2001), available at http://stemcells.nih.gov/info/scireport/PDFs/
fullrptstem.pdf.
2 For additional information on stem cell research, see CRS Report RL31015, Stem Cell
Research.
3 Id. at 4-6.
Congressional Research Service ˜ The Library of Congress

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cell nuclear transfer; and adult tissues (umbilical cord blood, bone marrow). Controversy
surrounds the derivation of stem cells from human embryos and fetuses. In order to
derive or extract the stem cells found within the embryo, the embryo is destroyed in the
removal process. The earliest embryonic stem cells are called totipotent cells, which
means they can develop into an entire organism, producing both the embryo and tissues
required to support it in the uterus. At a later stage of development, pluripotent
embryonic stem cells exist and can develop into almost any type of cell in the body.
These stem cells cannot form the supporting tissues, as seen with totipotent cells.4 Human
embryonic stem cells found in the early stage embryo are believed to have a greater ability
to become different types of body cells and have more uses than adult stem cells.
Background and Recent Presidential and Congressional Action
Executive Action. When President Bush took office in January, 2001, he
announced that he would conduct a review of the stem cell research issue and ordered the
Department of Health and Human Services (HHS) to review the National Institutes of
Health’s (NIH) guidelines issued by the former administration. During the review period,
NIH suspended its review of applications from researchers seeking federal funds to
perform human embryonic stem cell research. On August 9, 2001, President Bush
announced that federal funds would be available to support limited human embryonic
stem cell research. The new policy provides that federal funds may be used for research
on “the more than 60” existing stem cell lines that have already been derived or were
already in existence as of the date of the announcement.5 In identifying the stem cell lines
as being eligible for federal funding, the President said these embryos, from which the
existing stem cell lines were created, had been destroyed previously and could not develop
as human beings.
Under the new policy, federal agencies, primarily NIH, will consider applications for
funding if certain standards or eligibility criteria are met. The White House fact sheet
setting forth the President’s policy states: federal funds will only be used for research on
existing stem cell lines that were derived (1) with the informed consent of the donors; (2)
from excess embryos created solely for reproductive purposes; and (3) without any
financial inducements to the donors.6 The President directed NIH to examine the
derivation of all existing stem cell lines and create a registry of those lines. Pursuant to
this new policy, no federal funds will be used for: (1) the derivation or use of stem cell
lines derived from newly destroyed embryos; (2) the creation of any human embryos for
research purposes; or (3) cloning of human embryos for any purposes. The new policy
replaces previously issued stem cell guidelines and policies. The policy also requires the
4 Generally, for human development, the term embryo is used for the first 8 weeks after
fertilization and the term fetus for the 9th week through birth. HHS regulations define fetus as
“the product of conception from the time of implantation.” 45 C.F.R. 46.203.
5 Fact Sheet, Office of the Press Secretary, White House, President’s Embryonic Stem Cell
Research Policy (August 9, 2001), available at http://www.whitehouse.gov/news/releases/2001.
The number of available embryonic stem cell lines is now understood to be much lower than 60.
Although 78 cell lines are listed on the Human Embryonic Stem Cell Registry as eligible for use
in federal research, only 22 lines are identified as being available. For additional information on
the Human Embryonic Stem Cell Registry, see CRS Report RL31015, Stem Cell Research.
6 Id.

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creation of the President’s Council on Bioethics to study stem cells and embryo research
as well as other issues. NIH has listed entities that have developed stem cells lines that
meet the President’s criteria and are eligible for federal funding (the Human Embryonic
Stem Cell Registry). The President also stated that in FY2001, the government will spend
$250 million on research involving stem cells from other sources, e.g., umbilical cord,
placenta, adult and animal tissues.
Background and Congressional Activity. Prior to President Bush’s stem cell
announcement, and over the past years, federal law has prohibited HHS from funding
human embryo research. No federal funds have been used to support research on stem
cells derived from human embryos. Research in this area has been done through private
funding. Subsequent to several phases of action, in December 1994, President Clinton,
through an executive directive, prohibited federal funding on research to support the
creation of human embryos for research purposes and directed NIH not to allocate
resources for such research.7 The order banning funding for such research was followed
in 1996 by a legislative ban that was enacted in NIH’s funding measure.8 Congress has
passed a similar ban annually since that time. The original congressional ban stated that
federally appropriated funds could not be used for the creation of a human embryo or
embryos for research purposes or for research in which a human embryo or embryos are
destroyed, discarded, or knowingly subjected to risk of injury or death greater than that
allowed for research on fetuses in utero under 45 C.F.R. 46.208(a)(2) and 42 U.S.C. §
289g(b). The ban defined “human embryo or embryos” to include any organism, not
protected as a human subject under 45 C.F.R. 46 (Human Subject Protection regulations)
that is derived by fertilization, parthenogenesis, cloning, or any other means from one or
more human gametes (sperm or egg.) The rider language has not changed significantly
over the years. In the subsequent fiscal years after FY1996, the rider was enacted in Title
V (General Provisions) of the Labor, HHS and Education appropriations acts. The
prohibition does not ban fetal tissue research, although other restrictions apply.
Advances in medical science proceeded and in 1998 critical developments were
recognized by scientists at the University of Wisconsin. These researchers were able to
isolate human embryonic stem cells and coax them to grow into specialized cells. In light
of the presidential and legislative bans, NIH requested a legal opinion from the General
Counsel of HHS on whether federal funds could be used to support research on human
stem cells derived from embryos or fetal tissue. HHS’ General Counsel, Harriet Rabb,
concluded that then-current law prohibiting the use of HHS appropriated funds for human
embryo research would not apply to research using stem cells “because such cells are not
a human embryo within the statutory definition.”9 General Counsel Rabb determined that
the statutory ban on human embryo research defines embryo as an “organism” that when
implanted in the uterus is capable of becoming a human being. The opinion stated that
pluripotent stem cells are not and cannot develop into an organism, as defined in the
statute. HHS concluded that NIH could fund research that uses stem cells derived from
7 Statement on Federal Funding of Research on Human Embryos, 30 Weekly Comp. Pres. Doc.
2459 (Dec. 2, 1994).
8 Balanced Budget Downpayment Act, 1996, P.L. 104-99, Sec. 128, 110 Stat. 26, 34 (1996).
9 Letter from HHS Gen. Counsel Harriet Rabb to Harold Varmus, Director, NIH, January 15,
1999.

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the embryo by private funds. But, because of the language in the rider, NIH could not
fund research that, with federal funds, derived the stem cells from embryos.
Some members of Congress strongly opposed HHS’ view and believed that the
legislative ban, that would continue through FY2001, covered and prohibited such
research. Others supported both the administration’s position and the funding of such
research. In response to those opposed to the HHS opinion, and the subsequently
published NIH guidelines, Secretary Shalala stated in a letter that the definition of embryo
used in the HHS legal opinion relied on the definition of embryo in the statute and that
the ban applied only to research in which human embryos are discarded or destroyed but
not to research preceding or following “on such projects.”10 The letter stated: “Moreover
... there is nothing in the legislative history to suggest that the provision was intended to
prohibit funding for research in which embryos - organisms - are not involved.”
After the HHS legal opinion, and despite expressions of congressional opposition,
NIH indicated that it would fund research on pluripotent stem cells derived from human
embryos and fetal tissue once guidelines were issued and an oversight committee was
established. Draft guidelines were published in the Federal Register in December 1999
and final guidelines were issued in August 2000.11 The guidelines provided that studies
utilizing pluripotent stem cells derived from human embryos may be conducted using NIH
funds only if the cells were derived, without federal funds, from human embryos that were
created for the purposes of fertility treatment and were in excess of the clinical need of
the individuals seeking such treatment. Based upon HHS’s interpretation, funds could not
be used to extract or derive the stem cells from the embryo, thereby destroying the
embryo. NIH initiated the applications process but ultimately funding was not granted to
the applications. The prior administration’s process was then overtaken by events and the
new policy was set.
Congressional interest in stem cell research has continued since the President’s
announcement in 2001. During the 108th Congress, four bills involving stem cell research
have been introduced. H.R. 3960, the Stem Cell Replenishment Act of 2004, was
introduced by Rep. Juanita Millender-McDonald on March 11, 2004. H.R. 3960 would
allow federal funds to be used for research on human embryonic stem cells regardless of
the date on which the derivation process for such stem cells was initiated or completed.
H.R. 2852, the Cord Blood Stem Cell Act of 2003, was introduced on July 24, 2003
by Rep. Christopher H. Smith. A similar bill, S. 1717, was introduced on October 3, 2003
by Sen. Orrin G. Hatch. Both bills would authorize the Secretary of Health and Human
Services, acting through the Administrator of the Health Resources and Services
Administration, to enter into contracts with qualified cord blood stem cell banks to assist
in the establishment, provision, and maintenance of a National Network of Cord Blood
Stem Cell Banks that would contain at least 150,000 units of human cord blood stem
cells.
S. 303, the Human Cloning Ban and Stem Cell Research Protection Act of 2003, was
introduced on February 5, 2003 by Sen. Orrin G. Hatch. S. 303 would prohibit any person
or other legal entity from conducting or attempting to conduct human cloning. The term
10 Letter from Secretary Shalala to the Honorable Jay Dickey, Feb. 23, 1999.
11 64 Fed. Reg.67576 (1999); 65 Fed. Reg. 51976 (2000), respectively.

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“human cloning” is defined by the bill to mean “implanting or attempting to implant the
product of nuclear transplantation into a uterus or the functional equivalent of a uterus.”12
Research otherwise involving nuclear transplantation would not be prohibited. However,
such research would be subject to human subject protection regulations.
In addition to the four bills, other measures that would prohibit cloning have been
introduced. Because cloning is one method of obtaining embryos for stem cell
production, these bills are worth noting. H.R. 534, the Human Cloning Prohibition Act
of 2003, was introduced on February 5, 2003 by Rep. Dave Weldon. The House passed
H.R. 534 on February 27, 2003 by a vote of 241-155. H.R. 534 would prohibit any person
or entity from knowingly performing or attempting to perform human cloning. The term
“human cloning” is defined by the bill to mean “human asexual reproduction,
accomplished by introducing nuclear material from one or more human somatic cells into
a fertilized or unfertilized oocyte whose nuclear material has been removed or inactivated
so as to produce a living organism (at any stage of development) that is genetically
virtually identical to an existing or previously existing human organism.”13 Cloning for
reproductive purposes, as well as therapeutic purposes, would appear to be prohibited by
the bill. The Human Cloning Prohibition Act of 2003 was introduced as S. 245 in the
Senate by Sen. Sam Brownback on January 29, 2003.
H.R. 801, the Cloning Prohibition Act of 2003, was introduced on February 13, 2003
by Rep. James C. Greenwood. H.R. 801 would prohibit reproductive cloning, but seem
to allow therapeutic cloning. H.R. 801 would require cloning research to be conducted
in accordance with regulations for the protection of human subjects.
Note: This report was authored originally by Diane T. Duffy.
12 S. 303, 108th Cong. § 101 (2003).
13 H.R. 534, 108th Cong. § 2 (2003) (as passed by the House of Representatives).

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