The imminent launch of the world's first stem cell bank in Britain will signal the latest stage in a modern-day medical gold rush boasting all the ruthless rivalry of the Wild West.

Scientists say stem cells are the future of medicine, offering a way to cure a host of diseases and degenerative conditions. Pro-life groups are appalled by the Medical Research Council's plan, revealed last week, to create a bank containing cells harvested from hundreds of thousands of healthy human embryos, which will thus be destroyed. Politicians are delighted that this will make Britain the world leader in a pioneering branch of medical research, as it is the only country that allows so much access to embryonic stem cells for those seeking to cure diseases ranging from Alzheimer's to Parkinson's. "Stem cell researchers are going to hit lots of barren bits of rock until eventually they find the big mother lode of gold they're looking for," explains Erling Russem, a biotechnology specialist at the City investment house Nomura.

"The money may not start rolling in for a decade, but eventually someone is going to strike very lucky when they finally break through the next medical frontier. So, yes, people are still fired up about stem cells."

This promise of jam tomorrow has kept a number of the City's more long- term investors interested in stem cell research, despite the conspicuous lack of returns to date. But pressure on the scientists to deliver something - anything - of commercial value is immense and growing by the day. The race is truly on.

The three major players - Geron of California, and the British companies ReNeuron and PPL - have all seen their market values plummet as the more short -termist, mainstream investors tire of the waiting.

But specialist backers, such as the biotech venture capitalist house Merlin, have kept the faith. And, controversially, some of Britain's most successful fertility clinics - which provide the "spare" embryos to the research labs - are also now joining in the rush.

Only last week the Human Fertilisation and Embryology Authority held a secret meeting of leading fertility doctors and stem cell experts to discuss "matters of common interest". The first item on the agenda was how the clinics could provide more high-quality embryos (unhealthy ones are not appropriate for research uses), and the second item was the growing number of partnerships between IVF clinics and research groups. The possible conflicts of interest between a clinic helping people to have babies and research labs who would rather have those embryos for themselves was apparently not listed on the agenda.

The groundbreaking Assisted Reproduction and Gynaecology Unit in London, headed by Dr Mohammed Taranissi, is just one clinic to have set up a research project with stem cell scientists in Chicago. It hopes to become involved in research on this side of the Atlantic shortly. Another fertility specialist, Professor Ian Craft, has already applied for a stem cell research licence from the HFEA.

Dr Taranissi - perhaps unsurprisingly - does not like to discuss his collaboration with the stem cell industry. But the opportunities for a hugely profitable clinic whose two doctors pull in up to pounds 3m in fees a year from hundreds of IVF patients are obvious. The 1,000 cycles of IVF the clinic conducted last year would have created a small, but still significant, pool of healthy embryos for research - and possible commercial exploitation.

There are obvious incentives for the clinics to maximise the number of embryos they can provide for research, particularly if they can profit by it. Yet no data is being collected on the scale of this human traffic.

"Patients are already being offered free treatment if they donate half their eggs to another couple who cannot make them," explains Dr Taranissi. "Healthy embryos are a scarce resource - as most patients want to keep them themselves to try to make more babies - but researchers also need a lot of them. Stem cell research is big business and it's possible that we'll soon see couples being paid to give up their embryos for research."

This trade in and mass destruction of early human life - the embryos that could have gone on to make healthy human babies have to be physically dismantled for research - is alarming pro-life groups.

"It is true that patients have to fill in consent forms before their embryos can be donated to research. But are the implications of doing so made fully clear to people when they are at their most vulnerable and emotional?" said Josephine Quintavalle of Comment on Reproductive Ethics.

"We are concerned that there may be, or certainly soon will be, some sort of coercion involved in getting parents to donate their embryos. Payment could certainly be one form." If she is right, a massively controversial market in human beings will soon be with us.