Cytori Therapeutics (NASDAQ:CYTX), a micro-cap stem-cell therapy developer, is not as well known as more publicized and controversial embryonic stem-cell companies like Geron (NASDAQ:GERN). Cytori's proprietary Celution System is capable of processing a small sample of fat tissue from a patient in about one hour, and then delivering a concentrated dose of regenerative stem cells back to the patient for applications such as breast reconstruction and heart attacks. The Celution System avoids the ethical controversy of embryonic stem cells, instead relying on the patient's own fat tissue to provide the ultimate in personalized, regenerative stem-cell therapy without the hassle and cost of storage.

Last week, Cytori reported a first-quarter loss of $8.7 million, versus $7.5 million in the year-ago period. At the end of the first quarter, Cytori reported a cash balance of just less than $25 million. More importantly, the company plans to launch its first medical stem-cell device in Europe this year, with a market debut planned for Spain and Italy. After the European launch, Cytori hopes to be granted full FDA approval for a late 2008 product launch in the United States. In the first quarter, the company also initiated a chronic ischemia trial and made preparations to begin heart attack and breast reconstruction trials.

While Cytori may be a lesser-known player in the field of adult stem cell therapy, its unique approach of providing personalized, regenerative stem-cell therapy to patients without the cost and hassle of storage makes it a stock to watch in the coming year.

Looking for more Foolish biotech coverage? Check out the Fool's market-beating Rule Breakers newsletter service, which scours the market for innovators of all stripes and types. You can check out all of our recommendations, and get access to our message boards and exclusive content, with a 30-day free trial.

Fool contributor Mike Havrilla, R.Ph., B.S., Pharm.D., is a Rite Aid pharmacist who lives, writes, works, and enjoys running on the streets and trails in the small Pennsylvania town of Portage. He invites your comments and feedback. You can check out his picks and pans, along with the collective stock-rating wisdom of Foolish investors, at the free CAPS community home page -- where you can join in all the fun! Mike does not have a position in any company mentioned in this article. The Fool has a disclosure policy.