Recently, a novel cationic polymer, dextran-spermine (D-SPM) was developed for gene delivery. An efficient transfection was obtained using this polycation for a variety of genes and cell lines in serum-free or serum-poor medium. However, transfection using the water-soluble D-SPM-based polyplexes decreased with increasing serum concentration in cell culture in a concentration-dependent manner, reaching 95% inhibition at 50% serum in the cell growth medium. In order to overcome this obstacle, oleyl derivatives of D-SPM (which form micelles in aqueous phase) were synthesized at 1, 10, and 20 mol% of oleyl moiety to polymer epsilon-NH2 to form N-oleyl-D-SPM (ODS). Polyplexes based on ODS transfected well in medium containing 50% serum. Comparison with polyplexes based on well-established polymers (branched and linear polyethyleneimine) and with DOTAP/Cholesterol lipoplexes showed that regarding beta-galactosidase transgene expression level and cytotoxicity in tissue culture, the D-SPM and ODS compare well with the above polyplexes and lipoplexes. Intracellular trafficking using FITC-labeled ODS and Rhodamine-labeled pGeneGrip plasmid cloned with hBMP2 monitored by confocal microscopy revealed that during the transfection process the fluorescent-labeled polymer concentrates in the Golgi apparatus and around the nucleus, while the cell cytoplasm was free of fluorescent particles, suggesting that the polyplexes move in the cell toward the nucleus by vesicular transport through the cytoplasm and not by a random diffusion. We found that the plasmids penetrate the cell nucleus without the polymer. Preliminary results in zebra fish and mice demonstrate the potential of ODS to serve as an efficient nonviral vector for in vivo transfection.

The functional roles of BMP type IA and IB receptors mediating differentiation into the osteogenic and chondrogenic lineage were investigated in the mesenchymal progenitor line C3H10T1/2 in vitro. The capacity of type IA and IB BMP receptors was assessed by the forced expression of the wild-type (wtBMPR-IA or IB) and of the kinase-deficient, dominant-negative form (dnBMPR-IA or -IB) in parental C3H10T1/2 progenitors as well as in C3H10T1/2 progenitors which recombinantly express BMP2 (C3H10T1/2-BMP2) or GDF5 (C3H10T1/2-GDF5). Consistent with the higher endogenous expression rate of BMPR-IA in comparison with BMPR-IB, BMPR-IA plays the dominant role in BMP2-mediated osteo-/chondrogenic development. BMPR-IB moderately influences osteogenic and hardly chondrogenic development. BMPR-IB seems to be unable to efficiently activate downstream signaling pathways upon forced expression. However, a mutation conferring constitutive activity to the BMPR-IB receptor indicates that this receptor possesses the capacity to activate downstream signaling cascades. These results suggest that in mesenchymal progenitors C3H10T1/2 BMPR-IA is responsible for the initiation of the osteogenic as well as chondrogenic development and that BMPR-IA and -IB receptor pathways are well separated in this mesenchymal progenitor line and may not substitute each other. In addition this indicates that type IB and IA BMP receptors may transmit different signals during the specification and differentiation of mesenchymal lineages.

Viral delivery of the therapeutic gene bone morphogenetic protein-2 (BMP-2) is a promising approach for bone regeneration. The human parvovirus adeno-associated virus (AAV) type 2 is considered one of the most encouraging viral vector systems because of its high transduction rates and biosafety ratings. Bone morphogenetic protein-2 is a highly potent osteoinductive protein, which induces bone formation in vivo and osteogenic differentiation in vitro. The exogenous regulation of BMP-2 expression in bone-regenerating sites is required to control BMP-2 protein secretion, thus promoting safe and controlled bone formation and regeneration. We have therefore constructed a dual-construct vector for the recombinant AAV (rAAV)-based recombinant human BMP-2 (rhBMP-2) gene delivery system, which is regulated by the tetracycline-sensitive promoter (TetON). Each vector was encapsidated separately, yielding two recombinant viruses. We evaluated the efficiency of rAAV-hBMP-2 to induce bone formation in ectopic and orthotopic sites. Doxycycline (Dox), an analogue of tetracycline, was orally administered to mice via their drinking water to induce rhBMP-2 expression. Bone formation was measured using quantitative imaging-microcomputerized tomography and cooled charge-coupled device imaging-to detect osteogenic activity at the cellular level, detecting osteocalcin expression. The rAAV-hBMP-2-treated mice that were given Dox demonstrated bone formation in both in vivo models compared to none in mice prevented from receiving Dox. Thus, the Tet-regulated rAAV-hBMP-2 vector is an effective means of induction and regulation of bone regeneration and repair.

A major limitation to clinical stem cell-mediated gene therapy protocols is the low levels of engraftment by transduced progenitors. We report that CXCR4 overexpression on human CD34+ progenitors using a lentiviral gene transfer technique helped navigate these cells to the murine bone marrow and spleen in response to stromal-derived factor 1 (SDF-1) signaling. Cells overexpressing CXCR4 exhibited significant increases in SDF-1-mediated chemotaxis and actin polymerization compared with control cells. A major advantage of CXCR4 overexpression was demonstrated by the ability of transduced CD34+ cells to respond to lower, physiologic levels of SDF-1 when compared to control cells, leading to improved SDF-1-induced migration and proliferation/survival, and finally resulting in significantly higher levels of in vivo repopulation of nonobese diabetic/severe combined immunodeficiency (NOD/SCID) mice including primitive CD34+/CD38(-/low) cells. Importantly, no cellular transformation was observed following transduction with the CXCR4 vector. Unexpectedly, we documented lack of receptor internalization in response to high levels of SDF-1, which can also contribute to increased migration and proliferation by the transduced CD34+ cells. Our results suggest CXCR4 overexpression for improved definitive human stem cell motility, retention, and multilineage repopulation, which could be beneficial for in vivo navigation and expansion of hematopoietic progenitors.

Currently available murine models to evaluate mesenchymal stem cell (MSC) differentiation are based on cell injection at ectopic sites such as muscle or skin. Due to the importance of environmental factors on the differentiation capacities of stem cells in vivo, we investigated whether the peculiar synovial/cartilaginous environment may influence the lineage specificity of bone morphogenetic protein (BMP)-2-engineered MSCs. To this aim, we used the C3H10T1/2-derived C9 MSCs that express BMP-2 under control of the doxycycline (Dox)-repressible promoter, Tet-Off, and showed in vitro, using the micropellet culture system that C9 MSCs kept their potential to differentiate toward chondrocytes. Implantation of C9 cells, either into the tibialis anterior muscles or into the joints of CB17-severe combined immunodeficient bg mice led to the formation of cartilage and bone filled with bone marrow as soon as day 10. However, no differentiation was observed after injection of naive MSCs or C9 cells that were repressed to secrete BMP-2 by Dox addition. The BMP-2-induced differentiation of adult MSCs is thus independent of soluble factors present in the local environment of the synovial/cartilaginous tissues. Importantly, we demonstrated that a short-term expression of the BMP-2 growth factor is necessary and sufficient to irreversibly induce bone formation, suggesting that a stable genetic modification of MSCs is not required for stem cell-based bone/cartilage engineering.

Adult stem cells reside in adult tissues and serve as the source for their specialized cells. In response to specific factors and signals, adult stem cells can differentiate and give rise to functional tissue specialized cells. Adult mesenchymal stem cells (MSCs) have the potential to differentiate into various mesenchymal lineages such as muscle, bone, cartilage, fat, tendon and ligaments. Adult MSCs can be relatively easily isolated from different tissues such as bone marrow, fat and muscle. Adult MSCs are also easy to manipulate and expand in vitro. It is these properties of adult MSCs that have made them the focus of cell-mediated gene therapy for skeletal tissue regeneration. Adult MSCs engineered to express various factors not only deliver them in vivo, but also respond to these factors and differentiate into skeletal specialized cells. This allows them to actively participate in the tissue regeneration process. In this review, we examine the recent achievements and developments in stem-cell-based gene therapy approaches and their applications to bone, cartilage, tendon and ligament tissues that are the current focus of orthopedic medicine.

Estrogens exert their physiological effects on target tissues by interacting with the estrogen receptors, ERalpha and ERbeta. Estrogen replacement is one the most common and effective strategies used to prevent osteoporosis in postmenopausal women. Whereas it was thought that estrogens work exclusively by inhibiting bone resorption, our previous results show that 17beta-estradiol (E2) increases mouse bone morphogenetic protein (BMP)-2 mRNA, suggesting that estrogens may also enhance bone formation. In this study, we used quantitative real-time RT-PCR analysis to demonstrate that estrogens increase BMP-2 mRNA in mouse mesenchymal stem cells. The selective ER modulators, tamoxifen, raloxifene, and ICI-182,780 (ICI), failed to enhance BMP-2 mRNA, whereas ICI inhibited E2 stimulation of expression. To investigate if estrogens increase BMP-2 expression by transcriptional mechanisms and if the response is mediated by ERalpha and/or ERbeta, we studied the effects of estrogens on BMP-2 promoter activity in transient transfected C3H10T1/2 cells. E2 produced a dose-dependent induction of the mouse -2712 BMP-2 promoter activity in cells cotransfected with ERalpha and ERbeta. At a dose of 10 nM E2, ERalpha induced mouse BMP-2 promoter activity 9-fold, whereas a 3-fold increase was observed in cells cotransfected with ERbeta. Tamoxifen and raloxifene were weak activators of the mouse BMP-2 promoter via ERalpha, but not via ERbeta. ICI blocked the activation of BMP-2 promoter activity by E2 acting via both ERalpha and ERbeta, indicating that mouse BMP-2 promoter activation is ER dependent. In contrast to E2 and selective ER modulators, the phytoestrogen, genistein was more effective at activating the mouse BMP-2 promoter with ERbeta, compared with ERalpha. Using a deletion series of the BMP-2 promoter, we determined that AP-1 or Sp1 sites are not required for E2 activation. A mutation in a sequence at -415 to -402 (5'-GGGCCActcTGACCC-3') that resembles the classical estrogen-responsive element abolished the activation of the BMP-2 promoter in response to E2. Our studies demonstrate that E2 activation of mouse BMP-2 gene transcription requires ERalpha or ERbeta acting via a variant estrogen-responsive element binding site in the promoter, with ERalpha being the more efficacious regulator. Estrogenic compounds may enhance bone formation by increasing the transcription of the BMP-2 gene.

Monitoring gene expression in vivo, noninvasively, is a critical issue in effective gene therapy systems. To date, there are no adequate molecular imaging techniques, which quantitatively monitor gene expression in vivo in skeletal development and repair. The aim of this study was to monitor gene expression in skeletal development and repair, using a real-time molecular imaging system, which quantitatively and noninvasively detects bioluminescence in vivo. Our experimental model consisted of transgenic mice harboring the luciferase marker gene under the regulation of the human osteocalcin (hOC) promoter. A new light detection cooled charge coupled device (CCCD) camera was applied to monitor luciferase expression. In vitro, mesenchymal stem cells (MSCs) isolated from bone marrow of transgenic mice exhibited hOC promoter regulation, detected by luciferase expression that correlated with their osteogenic differentiation. During development from 1 week to 1.5 years, transgenic mice exhibited transgene expression in a wide spectrum of skeletal organs, including calvaria, vertebra, tail, and limbs, reaching a peak at 1 week in most of the skeletal organs. In two skeletal repair models, bone fracture and marrow ablation, the noninvasive CCCD system revealed a peak of luciferase expression at 6 days postsurgery. All quantitative, noninvasive, real-time CCCD measurements correlated with a luciferase biochemical assay and luciferase immunohistochemistry, which demonstrated luciferase expression in hypertrophic chondrocytes and trabecular osteoblasts. Our studies show for the first time (1) the CCCD detection system is a reliable quantitative gene detection tool for the skeleton in vivo, (2) expression of luciferase regulated by the hOC promoter is significantly decreased with age in most skeletal sites, and (3) the dynamics of hOC regulation during mice skeletal development and repair in real time, quantitatively and noninvasively.

Cell-mediated gene therapy is one of the new modalities branching out from the wide-ranging field of gene transfer and therapy. When applied to bone formation and regeneration, it has particular advantages depending on the type of cell used as a platform for gene delivery. When utilizing adult mesenchymal stem cells or osteoprogenitor cells for the expression of bone-promoting osteogenic factors, the cells not only express the factors promoting bone growth, but can respond, differentiate and participate in the bone formation process. The ability of engineered cells to respond to the transgene, as well as to other local signals in vivo, confers on them special properties that enable the formation and regeneration of large-scale bone tissue. This approach is a paradigm for the development of gene therapy strategies for other skeletal tissues. Here, we review the most recent studies related to cell-mediated gene therapy for bone formation and regeneration.

Osteoporosis is a disease manifested in drastic bone loss resulting in osteopenia and high risk for fractures. This disease is generally divided into two subtypes. The first, post-menopausal (type I) osteoporosis, is primarily related to estrogen deficiency. The second, senile (type II) osteoporosis, is mostly related to aging. Decreased bone formation, as well as increased bone resorption and turnover, are thought to play roles in the pathophysiology of both types of osteoporosis. In this study, we demonstrate in murine models for both type I (estrogen deficiency) and type II (senile) osteopenia/osteoporosis that reduced bone formation is related to a decrease in adult mesenchymal stem cell (AMSC) number, osteogenic activity, and proliferation. Decreased proliferation is coupled with increased apoptosis in AMSC cultures obtained from osteopenic mice. Recombinant human bone morphogenetic protein (rhBMP-2) is a highly osteoinductive protein, promoting osteogenic differentiation of AMSCs. Systemic intra-peritoneal (i.p.) injections of rhBMP-2 into osteopenic mice were able to reverse this phenotype in the bones of these animals. Moreover, this change in bone mass was coupled to an increase in AMSCs numbers, osteogenic activity, and proliferation as well as a decrease in apoptosis. Bone formation activity was increased as well. However, the magnitude of this response to rhBMP-2 varied among different stains of mice. In old osteopenic BALB/c male mice (type II osteoporosis model), rhBMP-2 systemic treatment also restored both articular and epiphyseal cartilage width to the levels seen in young mice. In summary, our study shows that AMSCs are a good target for systemically active anabolic compounds like rhBMP-2.

Mesenchymal Stem Cells (MSCs) are adult stem cells that constitute a variety of adult tissues. MSCs maintain self-renewal ability with the ability to give rise to different mesenchymal cells, and are therefore responsible in part, for the regenerative capacity of mesenchymal tissues. MSCs throughout a variety of species were found to be able to differentiate to several mesenchymal tissues including: bone, cartilage, stroma, adipose, connective tissue, muscle and tendon. MSCs are relatively easily isolated from the bone marrow and expanded in vitro. It was found that MSCs play an important role in bone physiology and hematopoiesis, and in part participate in the pathophysiology related to bone diseases, mainly osteoporosis. MSCs were widely used in experimental studies in vivo, and were shown to form mesenchymal tissues. These discovered features have made MSCs good candidates for the development of various therapeutic modalities aimed to regenerate mesenchymal tissues, mainly bone. The more important approaches currently utilizing MSCs are gene therapy and tissue engineering. Both exploit the current knowledge in molecular biology and biomaterial science in order to direct MSCs to differentiate in vivo to desired lineages and tissues. Better understanding of the molecular mechanism directing the differentiation of MSCs, will eventually allow us to properly manipulate MSCs both in vivo and ex vivo to allow the regeneration of complex tissues and organs.

The synthesis of polysaccharide-based sponges for the use in tissue engineering was systematically investigated. A comparison study of the branched polysaccharide arabinogalactan (AG) and the linear polysaccharide dextran in the formation of sponges by the reaction with diamines or polyamines was conducted. Three AG-based sponges were synthesized from the crosslinking reaction with different amine molecules. The sponges obtained were highly porous, rapidly swelled in water, and were stable in vitro for at least 11 weeks in aqueous media at 37 degrees C. AG-chitosan sponges were chosen as most suitable to serve as scaffolds for cell growth in tissue engineering. The biocompatibility in vivo of these sponges was evaluated by histological staining and non-invasive MRI technique after implantation in BALB/c mice. The sponge evoked an inflammatory response with vascularization of the implant. The inflammatory reaction decreased with time, indicating a healing process.

The BMP2-dependent onset of osteo/chondrogenic differentiation in the acknowledged pluripotent murine mesenchymal stem cell line (C3H10T1/2) is accompanied by the immediate upregulation of Fibroblast Growth Factor Receptor 3 (FGFR3) and a delayed response by FGFR2. Forced expression of FGFR3 in C3H10T1/2 is sufficient for chondrogenic differentiation, indicating an important role for FGF-signaling during the manifestation of the chondrogenic lineage in this cell line. Screening for transcription factors exhibiting a chondrogenic capacity in C3H10T1/2 identified that the T-box containing transcription factor Brachyury is upregulated by FGFR3-mediated signaling. Forced expression of Brachyury in C3H10T1/2 was sufficient for differentiation into the chondrogenic lineage in vitro and in vivo after transplantation into muscle. A dominant-negative variant of Brachyury, consisting of its DNA-binding domain (T-box), interferes with BMP2-mediated cartilage formation. These studies indicate that BMP-initiated FGF-signaling induces a novel type of transcription factor for the onset of chondrogenesis in a mesenchymal stem cell line. A potential role for this T-box factor in skeletogenesis is further delineated from its expression profile in various skeletal elements such as intervertebral disks and the limb bud at late stages (18.5 d.p.c.) of murine embryonic development.

BACKGROUND: Human mesenchymal stem cells (hMSCs) are pluripotent cells that can differentiate to various mesenchymal cell types. Recently, a method to isolate hMSCs from bone marrow and expand them in culture was described. Here we report on the use of hMSCs as a platform for gene therapy aimed at bone lesions. METHODS: Bone marrow derived hMSCs were expanded in culture and infected with recombinant adenoviral vector encoding the osteogenic factor, human BMP-2. The osteogenic potential of genetically engineered hMSCs was assessed in vitro and in vivo. RESULTS: Genetically engineered hMSCs displayed enhanced proliferation and osteogenic differentiation in culture. In vivo, transplanted genetically engineered hMSCs were able to engraft and form bone and cartilage in ectopic sites, and regenerate bone defects (non-union fractures) in mice radius bone. Importantly, the same results were obtained with hMSCs isolated from a patient suffering from osteoporosis. CONCLUSIONS: hMSCs represent a novel platform for skeletal gene therapy and the present results suggest that they can be genetically engineered to express desired therapeutic proteins inducing specific differentiation pathways. Moreover, hMSCs obtained from osteoporotic patients can restore their osteogenic activity following human BMP-2 gene transduction, an important finding in the future planning of gene therapy treatment for osteoporosis.

In the mouse, ovariectomy (OVX) leads to significant reductions in cancellous bone volume while estrogen (17beta-estradiol, E2) replacement not only prevents bone loss but can increase bone formation. As the E2-dependent increase in bone formation would require the proliferation and differentiation of osteoblast precursors, we hypothesized that E2 regulates mesenchymal stem cells (MSCs) activity in mouse bone marrow. We therefore investigated proliferation, differentiation, apoptosis, and estrogen receptor (ER) alpha and beta expression of primary culture MSCs isolated from OVX and sham-operated mice. MSCs, treated in vitro with 10(-7) M E2, displayed a significant increase in ERalpha mRNA and protein expression as well as alkaline phosphatase (ALP) activity and proliferation rate. In contrast, E2 treatment resulted in a decrease in ERbeta mRNA and protein expression as well as apoptosis in both OVX and sham mice. E2 up-regulated the mRNA expression of osteogenic genes for ALP, collagen I, TGF-beta1, BMP-2, and cbfa1 in MSCs. In a comparison of the relative mRNA expression and protein levels for two ER isoforms, ERalpha was the predominant form expressed in MSCs obtained from both OVX and sham-operated mice. Cumulatively, these results indicate that estrogen in vitro directly augments the proliferation and differentiation, ERalpha expression, osteogenic gene expression and, inhibits apoptosis and ERbeta expression in MSCs obtained from OVX and sham-operated mice. Co-expression of ERalpha, but not ERbeta, and osteogenic differentiation markers might indicate that ERalpha function as an activator and ERbeta function as a repressor in the osteogenic differentiation in MSCs. These results suggest that mouse MSCs are anabolic targets of estrogen action, via ERalpha activation. J. Cell. Biochem. Suppl. 36: 144-155, 2001.

Regulated expression of transgene production and function is of great importance for gene therapy. Such regulation can potentially be used to monitor and control complex biological processes. We report here a regulated stem cell-based system for controlling bone regeneration, utilizing genetically engineered mesenchymal stem cells (MSCs) harboring a tetracycline-regulated expression vector encoding the osteogenic growth factor human BMP-2. We show that doxycycline (a tetracycline analogue) is able to control hBMP-2 expression and thus control MSC osteogenic differentiation both in vitro and in vivo. Following in vivo transplantation of genetically engineered MSCs, doxycycline administration controlled both bone formation and bone regeneration. Moreover, our findings showed increased angiogenesis accompanied by bone formation whenever genetically engineered MSCs were induced to express hBMP-2 in vivo. Thus, our results demonstrate that regulated gene expression in mesenchymal stem cells can be used as a means to control bone healing.

The experimental work characterizing the anabolic effect of parathyroid hormone (PTH) in bone has been performed in nonmurine ovariectomized (OVX) animals, mainly rats. A major drawback of these animal models is their inaccessibility to genetic manipulations such as gene knockout and overexpression. Therefore, this study on PTH anabolic activity was carried out in OVX mice that can be manipulated genetically in future studies. Adult Swiss-Webster mice were OVX, and after the fifth postoperative week were treated intermittently with human PTH(1-34) [hPTH(1-34)] or vehicle for 4 weeks. Femoral bones were evaluated by microcomputed tomography (microCT) followed by histomorphometry. A tight correlation was observed between trabecular density (BV/TV) determinations made by both methods. The BV/TV showed >60% loss in the distal metaphysis in 5-week and 9-week post-OVX, non-PTH-treated animals. PTH induced a approximately 35% recovery of this loss and a approximately 40% reversal of the associated decreases in trabecular number (Tb.N) and connectivity. PTH also caused a shift from single to double calcein-labeled trabecular surfaces, a significant enhancement in the mineralizing perimeter and a respective 2- and 3-fold stimulation of the mineral appositional rate (MAR) and bone formation rate (BFR). Diaphyseal endosteal cortical MAR and thickness also were increased with a high correlation between these parameters. These data show that OVX osteoporotic mice respond to PTH by increased osteoblast activity and the consequent restoration of trabecular network. The Swiss-Webster mouse model will be useful in future studies investigating molecular mechanisms involved in the pathogenesis and treatment of osteoporosis, including the mechanisms of action of known and future bone antiresorptive and anabolic agents.

Monitoring the expression of therapeutic genes in targeted tissues in disease models is important to assessing the effectiveness of systems of gene therapy delivery. We applied a new light-detection cooled charged-coupled device (CCCD) camera for continuous in vivo assessment of commonly used gene therapy delivery systems (such as ex vivo manipulated cells, viral vectors, and naked DNA), without the need to kill animals. We examined a variety of criteria related to real-time monitoring of luciferase (luc) gene expression in tissues including bone, muscle, salivary glands, dermis, liver, peritoneum, testis, teeth, prostate, and bladder in living mice and rats. These criteria included determination of the efficiency of infection/transfection of various viral and nonviral delivery systems, promoter specificity, and visualization of luciferase activity, and of the ability of luciferin to reach various organs. The exposure time for detection of luc activity by the CCCD camera is relatively short (approximately 2 minutes) compared with the intensified CCD camera photon-counting method (approximately 15 minutes). Here we transduce a variety of vectors (such as viruses, transfected cells, and naked DNA) by various delivery methods, including electroporation, systemic injection of viruses, and tail-vein, high-velocity-high-volume administration of DNA plasmids. The location, intensity, and duration of luc expression in different organs were determined. The distribution of luciferin is most probably not a barrier for the detection of in vivo luciferase activity. We showed that the CCCD photon detection system is a simple, reproducible, and applicable method that enables the continuous monitoring of a gene delivery system in living animals.

BACKGROUND: Among the approximately 6.5 million fractures suffered in the United States every year, about 15% are difficult to heal. As yet, for most of these difficult cases there is no effective therapy. We have developed a mouse radial segmental defect as a model experimental system for testing the capacity of Genetically Engineered Pluripotent Mesenchymal Cells (GEPMC, C3H10T1/2 clone expressing rhBMP-2), for gene delivery, engraftment, and induction of bone growth in regenerating bone. METHODS: Transfected GEPMC expressing rhBMP-2 were further infected with a vector carrying the lacZ gene, that encodes for beta-galactosidase (beta-gal). In vitro levels of rhBMP-2 expression and function were confirmed by immunohistochemistry, and bioassay. Differentiation was assayed using alkaline phosphatase staining. GEPMC were transplanted in vivo into a radial segmental defect. The main control groups included lacZ clones of WT-C3H10T1/2-LacZ, and CHO-rhBMP-2 cells. New bone formation was measured quantitatively via fluorescent labeling, X-ray analysis and histomorphometry. Engrafted mesenchymal cells were localized in vivo by beta-gal expression, and double immunofluorescence. RESULTS: In vitro, GEPMC expressed rhBMP-2, beta-gal and spontaneously differentiated into osteogenic cells expressing alkaline phosphatase. Detection of transplanted cells revealed engrafted cells that had differentiated into osteoblasts and co-expressed beta-gal and rhBMP-2. Analysis of new bone formation revealed that at four to eight week post-transplantation, GEPMS significantly enhanced segmental defect repair. CONCLUSIONS: Our study shows that cell-mediated gene transfer can be utilized for growth factor delivery to signaling receptors of transplanted cells (autocrine effect) and host mesenchymal cells (paracrine effect) suggesting the ability of GEPMC to engraft, differentiate, and stimulate bone growth. We suggest that our approach should lead to the designing of mesenchymal stem cell based gene therapy strategies for bone lesions as well as other tissues.