The study, done by U.S. and Swedish researchers at Harvard Medical School, adds to arguments in favor of using embryonic stem cells in medical research.
"It's a step in the right direction for this research," Dr. Ole Isacson said in a telephone interview.
"Everyone talks about embryonic stem cells as potential treatment for Parkinson's, but this is one of the first solid demonstrations that this can work."
Stem cells from embryos can be kept alive in labs indefinitely and have the ability to develop into any kind of cell in the body. Scientists hope they could be used to treat a range of diseases, and perhaps even someday as a source of organs for transplant.
Opponents say the days-old embryos they are taken from are human lives and say it is immoral to use them.
Federally funded research on human embryonic stem cells is limited because producing such cells requires the death of human embryos. President Bush last summer approved some such research, but limited it to cell colonies that already exist - about 60 cell lines.
Isacson, Lars Bjorklund and colleagues at Harvard's McLean Hospital in Belmont, Massachusetts, used rats for their study.
The rats were given a form of Parkinson's disease using brain-destroying chemicals. In people, Parkinson's develops when brain cells that produce an important message-carrying chemical called dopamine die off.
Patients develop tremors and eventually lose control of movement. Parkinson's is treatable with drugs but the effects wear off, and there is no cure for the fatal disease.
Isacson and colleagues took stem cells from early mouse embryos, called blastocysts, and injected them into the brains of 25 experimental rats.
Fourteen of the rats seemed to get better, the researchers reported in Tuesday's issue of the Proceedings of the National Academy of Sciences.
When the rats, whose brains are damaged only on one side, are given amphetamines they will spin in a circle, Isacson said. The treated rats gradually stopped doing this.
The researchers also conducted magnetic resonance imaging tests and found that blood flow was restored to parts of the brains that had died from the Parkinson's effect.
"It's the strongest proof for me that these cells develop in a way that we may be able to understand," Isacson said.
They killed them a few months later and looked at their brains. The 14 rats who got better all had new brain cells, and testing showed the cells had developed into neurons and other brain cells from the mouse stem cell transplants.
Some of these cells produced dopamine, thus treating the Parkinson's symptoms in the rats, the researchers said.
Five of the rats died and they turned out to have teratomas -- a kind of tumor -- at the injection site.
Isacson said thi is one risky side effect of using stem cells, which can differentiate, or develop into mature cells, in an uncontrolled way. He is working to find ways to reduce this risk.
Researchers are trying all sorts of ways to treat Parkinson's using injections of cells, including brain cells from aborted fetuses, cells from pig fetuses and stem cells.
Experiments are also underway to see if adult stem cells can be used. These cells have gone partway down the road to differentiation -- to becoming one certain kind of cell -- but experiments suggest they can be redirected.
Another route is to pre-treat embryonic stem cells to try and coax them into becoming neurons before they are injected. Scientists hope this approach can prevent the development of tumors like the ones that killed some of the rats.
Isacson said he would now like to work with monkey cells and, eventually, human embryonic stem cells. He said that if further experiments are successful, there could be human trials of the technique in about five years.
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