America's largest breast cancer advocacy group has been forced to make a self-abasing retraction of its plan to cut funding for Planned Parenthood following a huge outcry against the decision.

Susan G Komen for the Cure, a Dallas-based organisation, has announced that it will honour existing grants to Planned Parenthood and allow the organisation to continue to apply for future funding – a U-turn from its earlier decision to cut its annual $650,000 provision.

Nancy Brinker, who set up Komen as a pledge to her dying sister to work to end breast cancer in the US, together with the foundation's board of directors, put out a statement in which they apologised to the American public "for recent decisions that cast doubt upon our commitment to our mission of saving women's lives".

Although the statement insisted that the move to sever Planned Parenthood's funding had not been political in nature, the board did admit that it had left itself open to the charge that it was vulnerable to political persuasion within America's highly-charged debate over abortion. It said that it would amend a new rule under which the funding cut had taken place to make clear that political considerations had no place in its decision making.

"The events of this week have been deeply unsettling for our supporters, partners and friends and all of us at Susan G. Komen," the statement said. "We have been distressed at the presumption that the changes made to our funding criteria were done for political reasons or to specifically penalize Planned Parenthood. They were not.

It added: "We do not want our mission marred or affected by politics – anyone's politics."

The newly-adopted rule under which Komen made its controversial decision to cut ties with Planned Parenthood, the largest reproductive and sexual health service provider in the US, stated that no body should be funded should it be under official investigation. Planned Parenthood is indeed under congressional investigation – the problem, though, is that the investigation was launched against it by overtly politically motivated individuals who are opposed to abortion. The organisation is a favourite target of anti-abortion lobbies because some of its clinics offer abortions.

"Our original desire was to fulfil our fiduciary duty to our donors by not funding grant applications made by organizations under investigation," Komen said in its statement. "We will amend the criteria to make clear that disqualifying investigations must be criminal and conclusive in nature and not political. That is what is right and fair."

In a statement, Cecile Richards, Planned Parenthood's president, described the support she had received since Tuesday as astonishing and "a testament to our nation's compassion and sincerity".

She said: "In recent weeks, the treasured relationship between the Susan G Komen for the Cure Foundation and Planned Parenthood has been challenged, and we are now heartened that we can continue to work in partnership toward our shared commitment to breast health for the most underserved women.

"We are enormously grateful that the Komen Foundation has clarified its grantmaking criteria, and we look forward to continuing our partnership with Komen partners, leaders and volunteers. What these past few days have demonstrated is the deep resolve all Americans share in the fight against cancer, and we honour those who are at the helm of this battle."

The reversal was welcomed by local Komen affiliates, many of which had publicly denounced the funding decision. "We are elated," said Michele Oftrander, executive director of Komen in Denver. "We opposed the decision from the very beginning. Planned Parenthood is an essential partner in breast health care."

However, Republican candidate Rick Santorum, campaigning in Missouri on Friday, said he was "very disappointed" by the reversal. "It's unfortunate that public pressure builds to provide money to an organisation that goes out and actively is the No 1 abortion provider in the country. That's not healthcare. That's not healthcare at all."

There have been suggestions that Komen's new rule was pushed through the foundation by the organisation's recently appointed senior manager for public policy, Karen Handel, who had been quoted as saying: "I am staunchly and unequivocally pro-life … Let me be clear: since I am pro-life, I do not support the mission of Planned Parenthood."

Komen's statement leaves some room for ambivalence, however. Though it says that existing funding for Planned Parenthood will be reinstated, it puts a question mark over future funding by saying only that the group will continue to have "eligibility to apply for future grants".

Whether those applications will be received favourably is left unresolved.

Since Komen announced on Tuesday that would pull the funding, it has faced a massive barrage of criticism. Social media protests appeared instantly, including a Tumblr blog entitled Planned Parenthood Saved me, which saw 216 posts in just two days.

Komen's own local offices went public with their disapproval. Paula Birdsong, spokesperson for Komen's Sacramento affiliate which opposed the national office's decision, said the chapter believed Planned Parenthood should not be penalised for being under investigation.

"Normally we are in complete support of decisions that are made at our national level but this issue is one we could not support," she said. "We believe until someone has been found to have been guilty of a charge, funds should not be pulled just because someone is under investigation. It's innocent until proven guilty."

Prominent individuals associated with Komen also resigned in protest, including the group's top health official, Mollie Williams, the executive director of its Los Angeles chapter, Deb Anthony. A member of its medical advisory board in New York, Dr Kathy Plesser, had also announced that she would resign if the decision were not reversed.

The fury directed at Komen was matched by an outpouring of support for Planned Parenthood. Michael Bloomberg, the mayor of New York, led the charge, pledging $1 for every equivalent dollar donated to Planned Parenthood up to a total of $250,000.

In addition, $400,000 was raised online from 6,000 donors in the first 24 hours after the announcement. Within hours of the controversy breaking, the $650,000 cut had been more than compensated.

Yet Komen continued to defend the decision, with chief executive Nancy Brinker appearing in a video published on the organisation's website to explain the decision. She also told MSNBC that Komen wanted to focus on giving grants direct to service providers, whereas Planned Parenthood sent people to other facilities. "The investigation isn't the only issue … Our issue is grant excellence."

Now Komen hopes that its policy reversal will temper the storm that has raged around it. "It is our hope and we believe it is time for everyone involved to pause, slow down and reflect," its statement said.