One strand of stem cell research is learning how to construct exactly the type of cell needed: "researchers for the first time have transformed a human embryonic stem cell into a critical type of neuron that dies early in Alzheimer's disease and is a major cause of memory loss. This new ability to reprogram stem cells and grow a limitless supply of the human neurons will enable a rapid wave of drug testing for Alzheimer's disease, allow researchers to study why the neurons die and could potentially lead to transplanting the new neurons into people with Alzheimer's. ... These critical neurons, called basal forebrain cholinergic neurons, help the hippocampus retrieve memories in the brain. In early Alzheimer's, the ability to retrieve memories is lost, not the memories themselves. There is a relatively small population of these neurons in the brain, and their loss has a swift and devastating effect on the ability to remember. ... Now that we have learned how to make these cells, we can study them in a tissue culture dish and figure out what we can do to prevent them from dying. ... This technique to produce the neurons allows for an almost infinite number of these cells to be grown in labs, allowing other scientists the ability to study why this one population of cells selectively dies in Alzheimer's disease. ... The ability to make the cells also means researchers can quickly test thousands of different drugs to see which ones may keep the cells alive when they are in a challenging environment. ... [Researchers] demonstrated the newly produced neurons work just like the originals. They transplanted the new neurons into the hippocampus of mice and showed the neurons functioned normally. The neurons produced axons, or connecting fibers, to the hippocampus and pumped out acetylcholine, a chemical needed by the hippocampus to retrieve memories from other parts of the brain."

Link: http://www.eurekalert.org/pub_releases/2011-03/nu-hsc030211.php