* Batches already in existence may be reviewed

* NIH says rules reflect broad public support (Adds reaction from Republican opponent, paragraph 9)

WASHINGTON, July 6 (Reuters) – The U.S. government released new rules on Monday governing federally funded research on human embryonic stem cells, loosening some ethical requirements that scientists said could have cost them a decade of work.

The rules, which take effect on Tuesday, keep many existing restrictions on the research. U.S. federal funds may still not be used to actually make the cells using human embryos — only to work with the cells after someone else has made them.

But the National Institutes of Health, which issued the rules, eased some of the measures in the initial guidelines drawn up in March, including the so-called “informed consent” requirements meant to ensure that people who donated embryos for research knew exactly what they might be used for.

“We allow a case-by-case review,” acting NIH director Dr. Raynard Kington told reporters in a telephone briefing.

In March, President Barack Obama lifted restrictions on human embryonic stem cell research that had been put in place by his predecessor, former president George W. Bush and asked the NIH to draw up new guidelines.

Stem cell company stocks did not move much on news of the new rules, in part because the changes mostly affect academic researchers who rely on federal funding for their work.

The NIH guidelines take into account many of the arguments put forward during nearly 10 years of debate over how best to use the potential of human embryonic stem cells, which have the power to give rise to all the cells and tissues in the body and which supporters hope can transform medicine.

Opponents say it is wrong to destroy human embryos for any reason.

“The administration’s decision to dramatically expand the number of stem cell lines derived from human embryos and create incentives for the destruction of human life is a provocative step beyond what the president proposed just months ago and yet another sign that he has quickly retreated from his promise to be a president for all Americans,” House of Representatives Republican leader John Boehner said in a statement.

However, over the years Congress reached a middle ground, with many social conservatives such as Utah Republican Senator Orrin Hatch supporting such research if it used embryos left over at fertility clinics.

BROAD PUBLIC SUPPORT

“The guidelines reflect the broad public support for federal funding of research using human embryonic stem cells created from such embryos based on wide and diverse debate on the topic in Congress and elsewhere,” the new rules say.

They limit such research to these in vitro fertilization or IVF leftovers but also loosen restrictions on using human embryonic stem cells made in other countries.

In April when the initial guidelines were published some scientists said the “informed consent” rules on educating embryo donors were so strict that they might force labs to discard valuable stem cell batches, called lines.

“The draft guidelines that were released were so restrictive that I feared the vast majority of lines would be excluded,” Dr. George Daley of Harvard University in Massachusetts said in a telephone interview. He said the revised rules answer his concerns.

“It is the most that the administration can offer under current law,” said Dr. John Gearhart, a stem cell expert at the University of Pennsylvania. “There are many ‘new’ cell lines that have exceptional properties and have been maintained under better conditions that will meet the criteria of use.”

The rules create in effect the first official federal oversight of human embryonic stem cell research, the American Society for Reproductive Medicine said.

They used induced pluripotent skin cells, or iPS cells — cells that have been reprogrammed to look and act like embryonic stem cells. Embryonic stem cells, taken from days-old embryos, have the power to morph into any cell type and, in mice, can be implanted into a mother’s womb to create living mouse pups.

Their experiment, published in Nature, means that it is theoretically possible to clone someone using ordinary connective tissue cells found on the person’s skin, but the experts were quick to distance themselves from such controversy.

“We are confident that tremendous good can come from demonstrating the versatility of reprogrammed cells in mice, and this research will be used to … understand the root causes of disease and lead to viable treatments and cures of human afflictions,” said Fanyi Zeng of the Shanghai Institute of Medical Genetics at Shanghai Jiao Tong University.

“It would not be ethical to attempt to use iPS cells in human reproduction. It is important for science to have ethical boundaries,” she said, adding that their study was “in no way meant as a first step in that direction.”

No one has ever cloned a human being and while many stem cell experiments in mice have been replicated in humans, not all have.

Led by Qi Zhou at the Chinese Academy of Sciences’s State Key Laboratory of Reproductive Biology, the team created iPS cells, using mouse fibroblasts, which are cells found in connective tissue in the skin.

Stem cells are the body’s master cells, giving rise to all the tissues, organs and blood. Embryonic stem cells are considered the most powerful kind of stem cells as they have the potential to give rise to any type of tissue.

But they are difficult to make and require the use of an embryo or cloning technology. Many people also object to using human embryonic stem cells and many countries limit funding for such experiments.

From the skin cells, the Chinese scientists created 37 stem cell lines, and of these, three generated live births.

“One line can generate such competent mice that the longest living one we have is nine months,” Zeng told Reuters.

“It has generated now more than 100 of second-generation (mice) and more than 100 third-generation (mice). It really demonstrates how fertile and strong the system is.”

The Chinese experiment generated questions and caution from other stem cell researchers not connected to the study.

“These investigators have, for the first time, unequivocally demonstrated that the iPS lines they have generated are truly pluripotent,” wrote Andrew Laslett, group leader of Human Embryonic Stem Cell Technology at the Australian Stem Cell Center in Melbourne, Australia.

Pluripotent is a term meaning the cells can give rise to all the tissues in the body.

“Moreover, the long-term stability of both the iPS cell lines and the long-term health of the mice generated using this procedure are yet to be reported. It will be interesting to see whether mice generated in this fashion have a higher propensity for tumor formation,” Laslett wrote.