[Q&A] Can Human Stem Cells Be Commercialized?
2025. 10. 23
Question: Against the backdrop of the booming development of biomedicine, human stem cells are playing an irreplaceable role in the biomedicine industry. They not only open up new treatment paths for intractable diseases, but also drive innovation in regenerative medicine and personalized healthcare. In areas such as new drug development and disease mechanism research, the application of stem cell technology has significantly accelerated innovation in the biomedicine industry and led to breakthroughs in related testing equipment and therapeutic technologies. As their value becomes increasingly prominent, a key question arises: Can human stem cells be commercialized?
Answer:
1. A Typical Case
Legal evaluation of the commercialization of human stem cells must be based on the current laws of each country. Taking a stem cell sales contract dispute case concluded by the Shanghai First Intermediate People’s Court (Shanghai First Intermediate People’s Court, Civil Judgment No. (2020) Hu 01 Min Zhong 4321) as an example, it clearly demonstrates the stance of Chinese judiciary on such issues. In this case, Mr. Wu signed an agreement with Juren Company to purchase 30 units of “mesenchymal stem cells derived from human placenta” at a unit price of RMB 35,000. The specific transaction arrangement was: Juren Company was entrusted by Mr. Wu to cultivate the stem cells and later provide a venue for stem cell reinfusion. However, after Mr. Wu paid the advance payment, Juren Company failed to fulfill its delivery obligations. The Shanghai First Intermediate Court issued a final judgment, ruling that the stem cell sales contract was invalid due to harm to public interest and ordered the return of property obtained under the contract.
In its reasoning, the court clarified four core attributes of stem cells: stem cells originate from the human body and possess a special “biological attribute”; stem cells, as a new type of biological therapy technology, have a unique “regulatory attribute”; clinical research and translational application of stem cells target medical and health needs, giving them a specific “market attribute”; and the regulatory norms related to stem cells carry a “public interest attribute.”
Regarding the biological attribute, the court held that according to China’s “Administrative Measures for Stem Cell Clinical Research (Trial),” medical institutions conducting stem cell clinical research must not charge related fees or publish (or indirectly publish) advertisements for stem cell clinical research. Therefore, stem cells extracted from the human body cannot legally be directly used as objects of trade. Regarding the regulatory, market, and public interest attributes, the court held that to engage in stem cell clinical research, one must first obtain project approval and registration for stem cell clinical research. Furthermore, if the stem cells involved are to be used in humans, they must undergo drug clinical trials or obtain drug marketing approval, or be part of clinical application of medical technology. Direct clinical application of stem cells is prohibited. Juren Company had neither obtained the qualification of a stem cell clinical research institution nor was it an enterprise engaged in the development, production, or operation of stem cell preparations or related drugs. The stem cell reinfusion involved in the case did not meet the requirements for clinical translational application. The reinfusion of stem cells in this case constituted direct clinical application of stem cells, which seriously violated national prohibitive regulations, breached ethical norms, undermined the national medical regulatory system, endangered the life and health safety of unspecified individuals, and thus harmed public interest. Based on the above reasons, the court ruled the contract involved in this case invalid.
2. Analysis
We believe that in-depth analysis of this case requires attention to two core issues: first, the legal status of human stem cells (corresponding to their biological attribute-“basic attribute”); second, the legality of the clinical translational application of human stem cells (related to the other three attributes). The court’s discussion of the second issue strictly followed current laws and regulations, and its reasoning was sufficient. However, regarding the determination of the legal status of human stem cells, the court’s reasoning still leaves room for discussion.
Specifically, the court’s interpretation of the “human stem cells” involved in the case was overly simplistic, directly equating them with stem cells in their natural state. If they are indeed human stem cells in their natural state, as components of the human body, based on the basic principle that humans are legal subjects rather than objects, their sale is naturally prohibited by law. Article 1007 of the Civil Code clearly stipulates that the sale of human cells, human tissues, human organs, and corpses in any form is prohibited. Any sale in violation of the above provision is invalid.
However, the key issue lies in what the subject matter of the contract actually is: are they stem cells in their natural state, or stem cells cultivated by Juren Company? This distinction is crucial for accurately defining the legal attributes of human stem cells. Unfortunately, current Chinese law has not yet clearly distinguished between these two types of stem cells. In practice, human stem cells are often broadly categorized under “biological attributes” and uniformly prohibited from being traded. This approach clearly fails to meet the market demand for human stem cells as raw materials in the current development of the biomedicine industry.
The difference between the two lies in: the typical application of stem cells in their natural state is bone marrow transplantation, i.e., directly using stem cells in bone marrow or peripheral blood without cultivation or processing for treatment. These stem cells retain their original biological attributes and should be prohibited from being sold, so bone marrow can only be donated. In contrast, the biomedicine industry often uses stem cells that have been artificially cultivated or processed. For example, Japan’s “Regenerative Medicine Act” and “Pharmaceutical and Medical Device Act” clearly propose the concept of “specified cell processed products,” distinguishing them from human stem cells in their natural state. The manufacturing methods of specified cell processed products are divided into two types: one is manufacturing within medical institutions actually engaged in regenerative medicine and related businesses; the other is commissioning external cell cultivation and processing institutions not affiliated with the medical institution. Japan’s Ministry of Health, Labour and Welfare also issues manufacturing licenses for specified cell processed products to qualified overseas institutions. For example, the International Regenerative Medicine Research Center of Hainan Jimin Boao International Hospital under China’s Jimin Pharmaceutical has obtained the “Specified Cell Processed Product Manufacturing Certification” issued by the Minister of Health, Labour and Welfare of Japan.
3. Conclusion
Under the current legal framework in China, due to the lack of clear distinction regarding the independent legal status of cultivated and processed human stem cells, judicial practice still equates them with human stem cells in their natural state and prohibits their sale based on the Civil Code and other laws. At the same time, the lack of compliance by the company involved in terms of stem cell processing qualifications and clinical translational application further reinforces the negative evaluation of such private transactions. However, looking to the future, as the biomedicine industry becomes more regulated, it would be appropriate to distinguish between human stem cells in their natural state and processed stem cell products in terms of legal status, and conditionally recognize the possibility of commercialization of the latter.