Bone marrow stromal cells (MSCs) can be exploited therapeutically in transgenic cell therapy approaches. Our aim was to determine if gene-modified MSCs sequestered within a clinically approved, bovine type I collagen-based viscous bulking material could serve as a retrievable implant for systemic delivery of erythropoietin (Epo). To test this hypothesis, we embedded Epo-secreting MSCs in viscous collagen (Contigen) and determined the pharmacological effect following implantation in normal mice. Primary MSCs from C57Bl/6 mice were retrovirally engineered to express murine Epo (mEpo) and 10(7) cells of a clonal population secreting 3 U of mEpo/10(6) cells/24 h were implanted subcutaneously in normal C57Bl/6 mice with and without viscous collagen. Without matrix support, Hct rose to >70% for <25 days and returned to baseline by 60 days. However, in mice implanted with viscous collagen-embedded MSCs, the Hct rose to >70% up to 203 days postimplantation (P < 0.0001). In parallel, plasma Epo concentration was significantly increased (P < 0.05) for >145 days. Moreover, surgical removal of the viscous collagen organoid 24 days after implantation led to reduction of Hct to baseline levels within 14 days. In conclusion, this investigation demonstrates that mEpo(+) MSCs embedded in a human-compatible viscous collagen matrix offers a potent, durable, and reversible approach for delivery of plasma-soluble therapeutic proteins.