In an NHS first, stem cells from babies born in Croydon will be extracted so they can be used in life saving treatments.

To make this happen Croydon Health Services NHS Trust has teamed up with Precious Cells Miracle (PCM), to collect, process and store stem cells extracted from umbilical cord blood and tissue.

Because these cells can become bone, muscle, cartilage and other types of cells there is the potential for them to be used to treat many diseases.

Under the terms of the deal PCM will provide Croydon University Hospital with the staff, technology and specialised equipment necessary to perform sterile collections of cord blood.

And expectant parents will be given the option of privately storing their stem cells with Precious Cells Group for their families own immediate use or of donating their cord blood stem cells to build up the Government’s public stem cell bank.

Precious Cells Group is covering the cost of storing and extracting the stem cells, which are then made available for the benefit of the public bank and those that require a transplant.

And it will share the private storage profits.

Precious Cells Group chief executive Dr Husein Salem said: “The initiative we have announced through our charitable arm, Precious Cells Miracle, aims to address the significant underfunding of UK stem cell banking and increase the number of stem cells banked from umbilical cord blood and tissue, which will contribute to the key UK target of banking 50,000 stem cells by 2016.

“It is also vital that people are properly educated about the availability and benefits of stem cell banking.

“Only when patients are given all possible information can they make an informed decision about how and when to bank their stem cells and the aim is that our partnership with the NHS Croydon Trust and further Trust hospitals will make a strong contribution to this process.”

PCM is the charitable arm of stem cell technologies provider Precious Cells Group.

It is in talks with another 15 NHS trusts and if the partnership is extended to the nearly 90 most suitable trusts it could enhance services and boost revenues with a value of close to £200m for the NHS.