We examined the ethical justification for a national policy governing public funding for the induced pluripotent stem cell (iPSC) stock project in Japan and argue that the initiation of the iPSC stock project in 2012, when no clinical trial using iPSC-derived products had yet succeeded, was premature and unethical. Our analysis considers a generally accepted justice criterion and shows it fails to justify public funding of the iPSC stock project. We also raise concerns related to the massive amounts of public funding at stake and the absence of evidence supporting claimed success rates. We conclude that the iPSC stock project should be re-considered and deferred until a substantial number of clinical trials using iPSC-derived products are deemed successful. This analysis should benefit others worldwide as they consider their own public funding policies.