Let's start at the beginning - we are not talking about embryonic stem cells. No cord blood is involved in this process. We get these stem cells from FAT, and the patient's own fat at that (see, you knew that muffin top had a purpose). So now that *that* is out of the way...
Stem cells are starter cells - they can differentiate into the cells that are needed, such as bone, tendon or ligament; they also act as a beacon for other healing cells to hone in on, bringing them to the areas of the body that need to be repaired.
Stem cell therapy is an up and coming modality in veterinary medicine, and it is showing some pretty impressive results. The gist of it is we harvest fat from your pet, process it until all we have left are the stem cells from the fat, and then reintroduce those cells into the areas that need it most. It is most commonly used for osteoarthritis patients (creaky old joints) and other orthopaedic injuries (cruciate tears, elbow dysplasia, hip dysplasia), although there is progress in other areas of regenerative medicine as well.
Why would you choose stem cell therapy over traditional management? Well, traditional management for osteoarthritis includes many things, but those that tend to be the most problematic are NSAIDs (non-steroidal anti-inflammatories like Rimadyl, Deramaxx, Metacam, etc). Many pets use these medications safely and long term, but they can cause GI upset, can affect the liver, and require blood work to monitor their use. While stem cell therapy doesn't always allow a pet to completely discontinue these medications, it can help to reduce their dependency on them.
Why would you choose stem cell therapy instead of surgical correction? Depending on the surgery you're talking about, stem cell therapy is more affordable (total hip replacements can get up to $10k or more), is generally less invasive, and tends to have a quicker turn around time. Also, if your pet has multiple joints that are affected (both hips, both hips and a knee, a knee and an elbow) recovering from a surgery that incapacitates an entire limb may cause worse damage to the other limbs.
This sounds a bit like a commercial for stem cell therapy, doesn't it? Sorry about that, it's not my intention. Stem cell isn't for everyone, and it doesn't have a 100% guarantee (neither does surgery, or NSAIDs, or physical therapy - there are no 100% guarantees), but it is SO exciting to have another option to treat these pets and relieve their discomfort. And the research and medicine behind it is so freaking COOL - turning fat into ligament??? Awesome.