Biotech Stemagen fused skin and egg to clone embryo

It was over martinis that a San Diego fertility specialist decided to start Stemagen, the eight-person biotechnology company that yesterday became the first to document that its scientists had cloned a human embryo by fusing a man's skin cell with an unfertilized egg.

Samuel Wood, a physician and Ph.D. scientist, was having drinks with a venture capitalist friend he declined to identify. Both had parents with degenerative disease and were discussing the promise of stem cells and how they might use their financial success to further work in the field.

At the time, the world believed that a South Korean scientist had cloned human embryos, a key step forward in creating stem cell lines that are specific to one person. That work was later proved fraudulent.

But theoretically, such cells might one day be used as a human toolbox whose contents could be used to create replacement cells for those destroyed by disease.

"We decided to invest our money in something that would try to save someone else from going through the same type of thing with their parents," Wood...