It’s happened before and now we see it again, adult stem cells can be manipulated to become other types of cells. This time it’s fat cells that have been morphed into nerve cells (h/t Wesley Smith). I gotta tell you I cringe every time I hear news stories about stem cell research which go into an “explanation” of what stem cells are because they always make the distinction between embryonic and adult stem cells by saying that one kind (embryonic) is flexible while the other (adult) is not. For example:

Members of the Coalition for Lifesaving Cures say embryonic stem cell research is important because of its flexibility. An adult liver stem cell cannot be changed. It can only be a liver stem cell.

Embryonic stem cells, however, can be manipulated into becoming several types of stem cells.

This just simply is not the case and the above story is another example of that.

See also:
Adult Stem Cells Revert to Embryonic Stem Cells
Minnesota Researchers Get Lung Cells From Cord Blood