KLD Completes Update of its Embryonic Stem Cell and
Fetal Tissue Research Report

In December 2005, KLD Research & Analytics, Inc. completed an update of its comprehensive Embryonic Stem Cell and Fetal Tissue Research Service. The service is designed to meet the needs of institutional investors and money managers implementing faith-based investment mandates.

KLD’s consulting report seeks to identify companies involved in research utilizing embryonic stem cells or fetal tissue for the research, development, and production of pharmaceuticals or therapies to treat diseases or other medical conditions. The standard report covers the composite Russell 3000/S&P 500 universe, although KLD can accommodate custom universes of U.S. and non-U.S. companies.

Embryonic stem cell research remains highly controversial in the U.S. with many groups opposed to the creation or harming of human embryos and fetuses for research purposes. In 2005, the attention paid to embryonic stem cell research by investors increased. This came after announcements by large corporations, such as General Electric, of their intention to begin research using embryonic stem cells, according to Michelle Lapolla, Manager of KLD's Consulting Services.

Last year also saw a high profile scandal involving renowned South Korean scientist Hwang Woo-suk, who was found to have faked results for a groundbreaking 2004 stem-cell paper.

Despite the continued ethical and scientific debate surrounding the use of stem cells and tissue derived from human embryos and fetuses, interest in this line of research remains high, particularly for its potential in the treatment of conditions including diabetes, spinal cord injuries, and Parkinson's disease. “I expect the debate over embryonic stem cell and fetal tissue research will remain a key political and social issue in 2006,” continued Ms. Lapolla.

KLD’s research service distinguishes between four types of involvement, allowing for customization:

• Embryonic Stem Cell/Fetal Tissue Research
• Enabling Technologies
• Use of Fetal Cell Lines (For Vaccine/Biologics Development)
• Ownership by a Stem Cell Company.

The majority of the companies on the report are involved with enabling technologies or use of fetal cell lines (42% and 45% of the companies respectively), although several of the companies have involvement in more than one area. Most of the companies on the report are pharmaceutical or other healthcare companies.

About KLD Consulting:

KLD’s Consulting department is responsible for researching emerging and other issues not currently covered through the Socrates research product. Consulting research reports include research on emerging markets, and topics such as embryonic stem cell research, animal welfare, and landmines. The Consulting department also works with select clients to create and implement social investment guidelines and strategies tailored to meet an organization’s specific needs.

KLD Consulting clients include church groups, health care organizations, foundations, pension funds, environmental and other social service organizations, and managers of socially screened annuities and mutual funds.