Tuesday, October 18, 2005

The Higher the Risk, the Higher the Reward?

Think of the state of California as a venture capitalist putting up seed money for risky endeavors. In the private sector, venture capitalists enjoy enormous rates of return. But they also lose lots on enterprises that fail.

Acting through the California stem cell agency, the state is serving as something of a venture capitalist, providing funds for research that private sector is unwilling to pay for because of risk. In the private sector, the higher the risk is, the higher the potential reward. The cost to state will be $6 billion. What should be the payoff to the state?

That is the question at the heart of the intellectual property discussions involving CIRM and a proposed constitutional change that could be on the ballot next June.

California's most influential state legislator on stem cell issues is the lead author on the measure, SCA13. Sen. Deborah Ortiz, D-Sacramento, proposed the legislation earlier this year. It already has cleared three committees in the Senate with bipartisan support and with no negative votes. It is now on the Senate floor.

The proposal includes language to tighten accountability and openness of the stem cell agency. But for our purposes today we are going to deal only with the issues of return on California's investment.

In its current form, SCA13 requires CIRM "to ensure that treatments, therapies, products, and services resulting from technologies and inventions derived from grants awarded are accessible and affordable to low-income residents, including those residents eligible for state and county-funded health care programs," according to a Senate staff analysis.

Ortiz removed more sweeping language after discussions with Robert Klein, chairman of the stem cell agency, which remains opposed to the ballot measure, largely on the grounds that its requirements would be so costly that it would discourage or prevent development of stem cell therapies. (We will have more on CIRM's position later this week.)

She has scheduled hearings for Oct. 31 in San Francisco on intellectual property and stem cell research. CIRM has its own hearing one week from today in Sacramento. Changes in the measure could easily come out of developments at the hearings.

Ortiz, who was a supporter of Prop. 71, has signalled her intent to aggressively pursue avenues that will lead to greater returns to the state than CIRM supports.

After the California Council on Science and Technology told California this summer to lower its expectations about big returns on stem cell research, she said, "As the council notes, there is an expectation that intellectual property policies need to direct a revenue stream to the state. The council also acknowledges that federal tax laws prevent Prop. 71, as written, from delivering on its promise to provide royalties or revenue streams back to the state while using tax-exempt bonds.

“Senate Constitutional Amendment 13, however, would establish a method for providing benefits to the state without jeopardizing the use of tax-exempt bonds. SCA 13 would require that the state’s public health programs have access at affordable, below-market costs to the products, medicines and therapies that eventually will be developed under Prop. 71. California should not have to pay twice for medical therapies that can assist our citizens who suffer from debilitating and life-threatening chronic conditions."

Following the earlier meeting between Klein and Ortiz, she said they both agree that the state should have some sort of return on its investment. She suggested that CIRM should examine "the model used by the International AIDS Vaccine Initiative, which requires entities receiving funding to commit to make vaccines available at reasonable prices and in sufficient supplies."

Klein suggested directing a "portion of the royalty payments negotiated by the ICOC into programs or initiatives to promote access to low cost therapies."

Also opposed to SCA13, according to the Senate analysis, are the Bay Area Science and Innovation Consortium, Bay Area Economic Forum and the Bay Area Council.

Supporting the measure are the California Association for Tax Reform, California Public Interest Research Group, Californians Aware and Common Cause.

Ortiz shelved SCA13 earlier this year when the Senate's Democratic leadership indicated it wanted to focus on the measures currently on the November ballot in California.

Once the election is past, the proposal is expected to clear the Senate and move on the Assembly, where it could be substantially modified by Ortiz.

CIRM staged a late, but major effort last spring to stall the proposal on its merits. But largely not discussed publicly was the potenial impact of another stem cell measure on the ballot in California less than two years after approval of Prop. 71.

SCA13 would likely become a referendum on the conduct of the stem cell agency, attract major attention from the conservative and religious right and become a major distraction from CIRM's primary efforts.

Correction

We incorrectly identified an organization in our Monday item, "Who Gets the Money?" It should have been the Center for Genetics and Society instead of the Center on Policy and Genetics.

Monday, October 17, 2005

Correction

Earlier today, we incorrectly reported that SCA13 had passed the California State Senate and was now in the Assembly. The measure, however, is still awaiting passage in the Senate. The error occurred in an item called "Who Gets the Money?"

CIRM Lawsuit Filings Available

If you are interested in receiving copies of the actual filings last week by the California attorney general and amicus brief in the lawsuit against CIRM, please send a note to djensen@californiastemcellreport.com. We will send them to you promptly.

Who Gets the Money?

Probably the biggest question of the year for the California stem cell agency is: Where's the money?

The second biggest is: Who gets the money?

That is what is at the heart of the intellectual property issue and CIRM. Two major hearings are scheduled for this month on the topic. One is being held by the stem cell agency on Oct. 25 in Sacramento. The other will be conducted by the Health committees of the State Senate and Assembly in San Francisco on Oct. 31.

During the election campaign one year ago, California voters were told to expect billions of dollars in benefits from passage of Proposition 71. A few months ago, a report from the California Council on Science and Technology said, "Get real." Don't expect huge bags of swag anytime soon, the council reported.

But State Sen. Deborah Ortiz, chair of Senate Health Committee, has authored a proposed constitutional amendment that would provide for greater benefits to the state than now proposed by stem cell agency leaders. The measure, SCA13, has already passed the Senate and is before the Assembly. It could be placed on the ballot in June of next year.

Look for folks from the Center on Policy and Genetics, Greenlining and the Foundation for Taxpayer & Consumer Rights to testify at one or both of the hearings. All three have indicated that they differ sharply with CIRM on IP issues.

Later this week we will have more to say on SCA13 and CIRM's position on intellectual property.

At this point, neither of the two hearings has remote access, either on the Web or otherwise. You can find the physical locations of both sessions in the California Stem Cell Calendar below.

Friday, October 14, 2005

Stem Cell Showdown in Apricot City

The stem cell stage is now set for a bit of courtroom drama Nov. 17 at 8:30 a.m. in a community east of San Francisco that was once known as "The Apricot City."

Directing the affair in Department 512 in Hayward will be Superior Court Judge Bonnie Lewman Sabraw, who was Alameda County trial judge of the year in 2001 and who was named to the bench by former Gov. Pete Wilson.

At stake is the existence of the California Institute for Regenerative Medicine. The Life Legal Foundation, which was deeply involved in the Terry Schiavo case, and a couple of conservative groups called People's Advocate and the National Tax Limitation Foundation, want to euthanize the stem cell agency.

Their contention is that CIRM violates the California constitution despite the fact that it was created by a constitutional amendment approved by voters in a process permitted by the constitution. Their suit says that the agency is not under "the exclusive control" of the state government.

California Attorney General Bill Lockyer argued in a brief earlier this week, "The voters' will as expressed through the initiative process is entitled to great deference. Yet the mere pendency of these challenges, even though they are without merit, has effectively prevented the state from marketing the bonds(to fund stem cell research).''

Entering the stage this week was an array of groups that filed an argument supporting the state's position. Prepared by the Los Angeles law firm of Munger, Tolles & Olson, it said, "Given the highly politicized nature of the subject, embryonic stem cell research remains especially vulnerable to shifts in political winds and the political fortunes of particular officials and candidates."

The brief continued, "No one wants to start down a new path of research that shows great promise only to have funding for that research up for grabs every election cycle."

The filing by Munger, whose clients include Warren Buffet, noted that the petitioners had something at stake. For example, Munger said, some of the organizations are engaged in scientific research and, "like other scientific institutions in this country, have benefited from public financial support."

Reporter Terri Somers of the San Diego Union Tribune, in fact, pointed out that the Burnham Institute, the Salk Research Institute, Stanford University and the University of Southern California, which supported the Munger filing, have been selected for CIRM grants worth millions of dollars.

Other supporters include the Christopher Reeve and Michael J. Fox foundations. A complete list can be found in the CIRM press release.

While the friend-of-the-court filing noted that Proposition 71 created CIRM "notwithstanding any other provision of the constitution," its main focus was on the effectiveness and history of the peer review process that has been used at the national and other levels to make grants.

It said, "In the United States, decisions concerning government funding of research proposals have largely been separated from politics. That separation has been achieved by a system that allows political input when establishing broad policy goals, followed by scientific decision-making through the peer review process to determine which specific proposals should be funded to achieve those goals. Peer review ensures that the quality of research proposals is judged by scientific merit and by the likelihood that the research proposal will achieve the goal of improving public health."

We should note that the People's Advocate and National Tax Limitation Foundation are two groups that have supported the virtually unfettered right of the people to the initiative process. It is odd that they now find the voters' will dubious.

Reporter Bernadette Tansey of the San Francisco Chronicle also wrote about this week's filings.

Wednesday, October 12, 2005

Stem Cell Legislation to Rise Again

In California's Capitol, few things are certain – even death and taxes.

Particularly the death of legislation.

Few measures ever truly die, they just are reincarnated in one fashion or another. Such is the case with the stem cell measure (SB18) vetoed recently by our governor. It would have required a performance audit of the California stem cell agency and provided protection for egg donors.

The bill by Sen. Deborah Ortiz, D-Sacramento, cleared the legislature with only two votes against it. But only one vote really counted – Arnold's.

Her office says the measure will rise once more when the legislature returns. Some changes are likely, but the California Institute for Regenerative Medicine cannot rest easy yet.

Low Hanging Fruit vs. Embryonic Stem Cell Research

"Scientists want to be free," according to the New York Times, which reports that the California stem cell agency is going to have to sort through conflicting agendas involving patient groups and scientists as it dispenses billions of dollars in stem cell research funds.

Reporter Nicholas Wade wrote Tuesday about the agency's stem cell conference earlier this month, extensively quoting Zach Hall, CIRM's president.

"Perhaps his most formidable problem is that the public's hopes for immediate success run high," said Wade, "but scientists at the conference warned that many basic problems with human embryonic stem cells remained to be solved - a sign that no therapeutic use of the cells is likely for years. Underlining that caution, few companies are in the cell therapy field and venture capitalists have shown little interest, some speakers complained."

Wade continued, "Because of the pressure for quick progress, several scientists urged Dr. Hall to focus on the 'low hanging fruit,' meaning research with the adult stem cells like the blood-forming cells of the bone marrow. Bone marrow transplantation has been developed into a routine though still hazardous therapy that can now treat eight diseases and could be extended to more, said Dr. Robert S. Negrin, chief of the Stanford blood and marrow transplant program.

"The idea of seeking quick gains from adult stem cells was resisted by some patients' advocates who said the intent of Proposition 71 was to focus on the research with human embryonic stem cells that the federal government cannot support.

"The new institute will have to sort through other conflicting agendas. Scientists want to be free to follow long-term goals, and some voiced the fear that patients' advocates would seek to force short-term solutions or channel the most money to the diseases with the most sufferers."

Wade did not really discuss the role of the Oversight Committee in making decisions about research strategy. Nor did he spend much time on the role of stem cell chairman Robert Klein. His name was only mentioned once in the piece in the New York Times, which has rarely reported on CIRM. Chalk up the Times' attention to the staging of the international stem cell conference, which was partially aimed at generating this sort of article, among other many other things.

Tuesday, October 11, 2005

Villains, Big Pharma and Stem Cell Research

California political life has some perennial villains. For example, Big Oil. You can't go wrong attacking Big Oil, goes the general political wisdom.

A newcomer to that pantheon is Big Pharma. While the phrase does not exactly roll off your tongue, Big Pharma has major problems with its public image. And now Big Pharma is being invoked in connection with the California stem cell agency. At issue is who stands to benefit from $3 billion in taxpayer-financed stem cell research.

Here is how the matter was defined in an op-ed piece Monday in the San Jose Mercury News written by Jerry Flanagan, health care policy director for the Foundation for Taxpayer and Consumer Rights, and Deborah Burger, president of the California Nurses Association:

"The proposal to apply federal ownership rules to California stem-cell research raises key questions: Do taxpayers who are funding stem-cell research deserve a return on their investment? Should private industry be allowed to charge the public whatever price it chooses to access medical treatments whose discovery and development the public already paid for?"

The article gave this example of past performance involving Big Pharma: "The rights to the blockbuster glaucoma drug Xalatan, developed with $4 million in taxpayer grants at Columbia University, were sold to Pharmacia Corp. for less than $150,000. Pharmacia made $507 million on Xalatan in 1999 alone, charging U.S. patients $50 a bottle for ingredients that cost only pennies."

Flanagan and Burger also noted that there are some signs that Californians should be wary of the intellectual property position of the California stem cell agency.

"At least 13 of the 16 applicants to receive the first round of Proposition 71 grants have already fostered deep ties with the drug and biotech industries," they wrote. "For example:

•"One university grant recipient, the University of California-San Francisco, has staff who serve on pharmaceutical company boards and the stem-cell oversight board (which approves grant applications), receives funding from one of the world's largest drug manufacturers (Bristol-Myers Squibb), and has a research center on campus paid for by biotech giant Genentech.

•"At least eight of 11 universities to receive grants have staff serving on the boards of, or are employed by, pharmaceutical and biotech companies such as Amgen, Genentech, Bristol-Myers Squibb and Johnson & Johnson.

•"The private Burnham Institute has four board members with ties to biotech or pharmaceutical companies and its president is a member of the stem-cell oversight board."

Monday, October 10, 2005

The Bee: Stem Cell Conference Wise, But CIRM Leaders Still Bogus on Disclosure

The Sacramento Bee does not find many matters to be pleased about concerning the California stem cell agency.

Editorially it has been been a frequent and vociferous critic. But during the weekend, it wrote approvingly about the $215,000 stem cell conference earlier this month. That was the one with the secret budget that we wrote about earlier.

The Bee called the session "one of the wisest expenditures we've seen yet from this agency." The conference "exposed the challenges researchers face in studying embryonic stem cells, which have the ability to develop into any tissue and organ of the body."

As an example, The Bee wrote, "Say that scientists find a stem cell cure for Type 1 diabetes, which afflicts 1 million Americans. How do you mass-produce the billions of islet cells needed to treat these people? Should that be a private or public enterprise? If it is private, will only the rich be able to afford it?"

The editorial continued, "Unfortunately, in assembling a series of panel discussions that were broad in scope, conference organizers ignored any discussion of the many ethical quandaries that confront this field. One key question is how research institutes will ensure that women aren't exploited, or put at undue risk, when they donate eggs and embryos for research. Similar concerns surround people who may one day volunteer for experimental - and potentially risky - stem cell therapies.

"At the moment, lawsuits have blocked the stem cell institute from distributing grant money, so these issues may seem premature. They are not. During this period of limbo, institute leaders would be smart to deal with all outstanding concerns about the institute's operations, so they can hit the ground running if and when they have money to spend.

"Speaking of outstanding concerns, it was heartening to hear scientists publicly disclose their business relationships during presentations at the conference. For months, institute leaders have claimed that scientists wouldn't want to serve as advisers if they had to publicly reveal their economic interests. Last week's confab, once again, proved such claims are completely bogus."

Friday, October 07, 2005

“Everything” Targeted in Stem Cell Research

Reporter Edie Lau of The Sacramento Bee had another take on last weekend’s stem cell conference that we missed in our search.

She wrote, “What should California spend its stem cell money on to produce good medicine? Scientists called together over the weekend to give their ideas had, in sum, a short answer: On everything.”

She noted that stem cell research is still in the early stages and that much needs to be done.

She also had this: “Dr. Irving Weissman, director of the Institute for Cancer and Stem Cell Biology and Medicine at Stanford University, said one method for testing cells is by putting them into mice and seeing how the cells behave.

“Weissman acknowledged that the step is, to some minds, objectionable. That's because in creating animals possessing human cells, scientists would be creating human chimeras, calling to mind monsters of Greek mythology. Nevertheless, Weissman said the work is essential, and raised concerns over a bill in Congress that would ban such research.”

Wednesday, October 05, 2005

Want a Stem Cell Grant? Here Are Some Clues, Sort Of

If Californians wanted to know about the big international stem cell conference staged last weekend by the state's stem cell agency, the man they needed to rely on was reporter Carl Hall of the San Francisco Chronicle.

He appears to have been the only newspaper reporter filing reports on the two-day conference in San Francisco. His stories Sunday and Monday (a shared byline with Cornelia Stolze)provided some insight into the thinking at the agency and some details on how it intends to proceed, although it is still facing a court battle over its existence that will extend into 2006.

Hall wrote on Sunday that presentations Saturday "broke little new ground." On Monday, he reported that the session "marked a turning point for the state stem cell agency as officials try to shift from the frustrations of starting a controversial new enterprise into solving some of the most exciting challenges of biology." ("Turning point" may have been a bit optimistic.)

Hall said stem cell directors compared the presentations at the $215,000 conference to "reading about political candidates on the eve of an election: Even though they had heard it all before, they were still primed for a fresh summary. 'We're getting a solid scientific and clinical foundation for the institute's future work,' said Michael Goldberg, a venture capitalist who serves on the Prop. 71 governing board, known as the Independent Citizens Oversight Committee.'"

Hall's stories provided some fresh reporting on possible future direction of the agency.

"Several committee members said it's clear the program must bankroll novel collaborations to solve the big problems and avoid duplicating efforts, such as creating central facilities for banking lines of stem cells and carrying out clinical trials.

"That pointed to some obvious conflicts if research centers long used to competing with one another suddenly find themselves trying to collaborate, while also allying with profit-seeking companies on projects backed by tax-exempt bonds.


"Dr. Edward Holmes, medical school dean at UC San Diego and a member of the stem cell board, said the "industrial model" of drug development is a hard sell in academia.

"'Academics are rewarded for not doing the same thing twice,' he said.

Dr. Francisco Prieto, a diabetes specialist on the stem cell board, suggested it will be no simple matter to turn the scientific priorities into a workable program, adding that some key elements were absent from the weekend agenda. 'We've heard a lot about the what and how of stem cell research, but we've talked very little about the ethical and social implications,' he said.

Jeff Sheehy, a board member appointed to represent people with HIV/AIDS, said the talks highlighted 'a fundamental tension here between basic science and clinical science.'

"'How much do you have to know before you can actually start putting these cells into somebody?' he said, a question regulators also are beginning to tackle."

If researchers are looking for clues to what types of grants they might be able get funded in the future, Hall wrote, "Although it's hardly the final list, these appear to be some of the most important recommendations most experts endorsed:

"-- A centralized bank of human embryonic stem cell colonies and other raw materials to do the research, probably one in Northern California and another in Southern California to serve labs in each region.

"-- Fundamental research on the basic tools of stem cell research, in particular how to reliably coax the ultra-flexible stem cells into forming the many specialized cells of the body, a process known as differentiation."

"-- More efficient ways to genetically reprogram stem cells to represent particular genetic diseases, probably using a type of research cloning technology, called somatic cell nuclear transfer.

"-- Foster collaborations among many institutions, drawing in corporate partners early on to ensure that basic research is done in a way that will satisfy regulators and is directed toward projects with the best chance of paying off."

Hall reported that the agency plans to create subcommittee to come up with a strategic plan, a process that could cost hundreds of thousands of dollars, according to CIRM documents. Presumably most of that will go to a private consulting firm, given its minimal staffing and high use of outside firms.

Saturday, October 01, 2005

Otis Aims at Stem Cell Report; Governor Nixes SB18

Hurricane Otis is taking a run at the California Stem Cell Report. As of this posting, it should brush by us down here in Romantic Old Mexico near Guaymas. But preparations for all possibilities are distracting us from postings.

However, we can tell you that the governor vetoed a measure to tighten oversight of the California stem cell agency. Reporter Carl Hall of the San Francisco Chronicle looks like he may be the only writer this morning to cover the veto.

The measure by Sen. Deborah Ortiz, D-Sacramento, would have added performance audit requirement and egg-donor protections to the California stem cell program.

Hall wrote, "In a veto message, the governor said he supported the main provisions of the bill but found it to be "in direct conflict" with a provision in Prop. 71 barring amendments until 2008."

"Ortiz issued a news release Friday decrying the veto, arguing that the bill
was 'carefully drafted' to avoid conflict with Prop. 71. She said that
'patient protections and appropriate public accountability must be included to
maintain the public's confidence' in the stem cell effort. Zach Hall, the institute's president, said during an interview Friday that the
institute never took a formal position on the bill. Officials already are
working through details of egg-donor protections, he said, and support the
need for routine audits.

"'We have always assumed we would be audited, and we want to be," Hall said.
'Exactly how it happens is not a major issue for us. It can be by whatever
mechanism the Legislature feels is appropriate.'"

Wednesday, September 28, 2005

Stem Cell Science: Glue Your Ears to the Internet

The California stem cell agency's first-ever, international science conference can be monitored on the Internet this weekend.

The agency said the sessions will be webcast live on www.thesciencenetwork.org and at www.cirm.ca.gov. The full agenda for the conference can be found here.

This is the first webcast of an event involving CIRM, a move that is long overdue. Meetings of the working groups are generally available at remote locations that are set up for the benefit of Oversight Committee members. The public is welcome also. However, none of the Oversight Committee meetings have a similar arrangement and none have been broadcast.

Both the University of California and Zoomedia have the capability of doing webcasts, which are quite common on the Internet. Zoomedia is rebuilding the agency's website as part of San Francisco's bid to secure the headquarters of CIRM. It would behoove Zoomedia to also webcast CIRM meetings as well.

Tuesday, September 27, 2005

CIRM Stalls Again on Mystery Costs

Shortly after we posted the item below on the mystery budget for this weekend's stem cell science conference, the California stem cell agency reinforced its stalling tactics on the session's costs.

We received an email from CIRM, which claims the information is "preliminary" and thus is not public. The claim is part of the hoary bureaucratic stall technique discussed in our earlier item. The appropriate translation of the message from CIRM is, "Sue us. Our $500-an-hour attorney will take on any comers. We may not prevail, but the litigation will take months, if not years, so go for it."

Here is what CIRM said: "We have determined that the record you have requested is a preliminary draft, which will not be retained by CIRM in the ordinary course of business and is exempt from disclosure under Government Code section 6254(a).
 
"The budgeted amount for the Scientific Conference is $215,000. This figure is available on the CIRM website at http://www.cirm.ca.gov/meetings/pdf/2005/08/31/083105_item_3c.pdf.
 
"The figures for individual budget items have not yet been finalized, however we anticipate that our actual costs will fall below the budgeted $215,000 figure. We will be happy to provide you with the breakdown of the conference costs when those numbers are final."

Hundreds – if not thousands – of state government bureaucrats have argued over the years that much of what they do is "preliminary" and thus not fit for the public. CIRM, however, has published online scores of documents, equally as preliminary as the proposed spending plan for its science conference. Indeed, CIRM published preliminary versions of its own annual budget plans. Other government agencies do the same. The governor of California publishes incredibly detailed preliminary versions of his budget each year as does the President of the United States.

We should note that if the preliminary information is not retained, not even the CIRM staff will know whether the figures come in under budget – unless it subscribes to the oral tradition of bookkeeping.

The significance of CIRM's response has little to do with the conference itself. It has a great deal to do with whether it is a responsible public agency that takes its charge seriously and honestly. Based on this sad reaction to a request for routine information, it appears that empty rhetoric is likely to be the order of the day for the California stem cell agency.

Mystery Spending at CIRM's Scientific Conference

The California stem cell agency will stage its first-ever scientific conference this weekend in San Francisco with expenses that run to about $9,000 per featured participant.

The two-day event is budgeted at a total of $215,000 and is designed to help identify scientific priorities for the first phase of stem cell research by the agency. Internationally known researchers are flying in for the session in Baghdad-by-the-Bay.

Presumably CIRM is picking up their expenses, but the agency has refused to release the spending plan for the conference until some indefinite date in the future. On the surface, the conference seems to be a worthwhile endeavor. In business terms, it is good marketing move. It will help focus international attention on CIRM and help generate credibility for the agency as it hits up potential purchasers of the bond anticipation notes that it needs.

But $215,000 is a large sum for an agency that has been vocal about its need to conserve its financial resources given the court challenges it faces.

How is that money being spent? No one outside the agency knows. Is there something dubious going on? Probably not, but the agency's refusal to share – in a timely fashion --public information about its activities does raise questions.

CIRM says it will disclose the conference budget when it is "final," whatever that means. The conference begins in two days. One would think CIRM would have "finalized" its conference spending plans by now.

One version of the agenda shows 25 outside speakers (excluding CIRM officials), amounting to a per capita expense of nearly $9,000. We have been told only that there are no honoraria, but little else.

CIRM's response to the information follows a time-honored and dubious tradition in some bureaucracies that stall when they receive requests for information. Often, the techniques are used because the information contains something embarrassing. Stalling allows time to cover up the worst disclosures, impart a favorable spin or simply out wait the inquiring party. Other times, the stall amounts to a mindless reflex by an organism that simply wants to repel any intruder.

Often the stall works. Information – like fish – does not improve with age. Time passes, and the information becomes less relevant.

It is difficult to understand why the agency is refusing to release the information. It is certainly not in CIRM's best interest to raise unnecessary questions about how it conducts the public business.

The stem cell agency's actions in this case fall woefully short of the promises by stem cell chairman Robert Klein to meet the highest standards of openness and transparency.

Sunday, September 25, 2005

Too Much Inside-The-Box Thinking From CIRM

Every other day – at least during non-hurricane season – a stem cell news story seems to pop up with quite some regularity. Often enough that some might think that stem cell research is commonplace.

Just how uncommon it actually is was highlighted recently by The Economist magazine in a piece that makes clear the opportunities and challenges faced by the California stem cell agency.

The Economist article (Sept. 22 edition) cites a report by Michael Steiner and Nils Behnke, consultants with Bain & Company that forecasts only a $100 million market for stem cell therapies by 2010, rising to $2 billion by 2015. That contrasts with some reports that predict a $10 billion market by 2010.

The Economist says Bain's predictions are convincing.

"According to Bain's estimates, there are now roughly 140 stem-cell-related products in development, for various forms of cancer, liver disease and other conditions. But more than four-fifths of these projects are in early-stage development, where many a gleam in a scientist's eye dies, and still far from the clinical studies where promising new treatments can also still falter. In addition to these scientific hurdles, the field is fraught with ethical debate over some of its most promising areas, such as the use of stem cells from embryos and therapeutic cloning," the magazine wrote.

Steiner estimated that slightly more than "$1 billion was spent on stem-cell work last year, a mere 1% of global spending on health-care R&D. More than four-fifths of that investment came from governments. Venture capital, the traditional engine of biotechnology, is remarkably scarce in stem cells. Only $50 million was pumped into the field last year, as private investors look for safer bets in more developed products with larger markets, where regulation and patent protection is more clearly defined," the magazine said.

Given the $1 billion figure, that would make CIRM's probable $300 million a year pretty hefty. It would be a figure large enough to have a significant impact on stem cell research and its practices, including the possibility of changing them So far CIRM has been in a get-along, go-along mode, too timid to challenge the sacrosanct, closed-door, we-know-best attitude of the scientific community and its business allies. Yes, it is difficult and risky to make changes in the comfortable practices of old. But, as stem cell chairman Robert Klein likes to point out, 59 percent of California voters said emphatically that they are fed up with inside-the-box thinking when they approved Prop. 71.

Friday, September 23, 2005

Where's The Money?

"People quote things out of context all the time, but we tried to make it clear what it was." -- Bruce Deal, managing partner of the Analysis Group, the Menlo Park firm that produced a report that touted the largess that Prop. 71 would provide for California.

Reporter Malcolm Maclachlan quoted Deal in a piece in Capitol Weekly headlined "Stem Cell's Shell Game. It was the first interview that we have seen with Deal, whose report has come under criticism, particularly in light of the California Council on Science and Technology's admonition that California should not expect big returns from the California stem cell agency any time soon.

One might suspect some of the critics of a bit of dissembling. Most of them are not so naïve as to expect that studies generated on behalf of political campaigns are paragons of balance and objectivity. It is, and was, hardly realistic to expect campaign supporters to put out a report on Prop. 71 that was less than approving.

The report in question was produced by Laurence Baker, an associate professor of the Stanford University School of Medicine, and Deal, managing partner of the Analysis Group.

Maclachan wrote, "The figures, Deal said, were based on payouts that some research universities have received for IP (intellectual property) rights. They were calculated on the assumption that, over time, Prop. 71 would pay for both basic research and later-term studies leading to commercially available therapies. 'The idea of the report was to give examples of what could be possible if therapies were successful and the state could secure intellectual property rights,' Deal said. 'People quote things out of context all the time, but we tried to make it clear what it was.' "

The Baker/Deal study is likely to be a subject of continuing interest because of the intellectual property issues involving the the stem cell agency. State Sen. Deborah Ortiz, chair of the Senate Health Committee, has already said she expects more benefits than what the CCST study says is reasonable. The stem cell agency itself scheduled and the cancelled one meeting this month on IP matters. And still out there is Ortiz' proposed constitutional amendment which could make a statewide ballot in nine short months. Her previous legislative efforts at openness within the agency forced it to tighten its rules. The constitutional change could serve as a hammer to convince CIRM to attempt to provide more benefits to the California from taxpayer-financed stem cell research.

Wednesday, September 21, 2005

Bustamante Names New Stem Cell Overseer

The newest member of the Oversight Committee of the California stem agency is Marcelina "Marcy" Andaya Feit, president and CEO of ValleyCare Health System, a non-profit healthcare system with hospitals in Livermore and Pleasanton in California.

Lt. Gov. Cruz Bustamante made the appointment, filling a vacancy left by the resignation of Phyllis Preciado, who took a job in Oregon.

Here is the full text of Bustamante's press release, which was not available on the Internet at the time of this writing.

"Lt. Governor Cruz Bustamante today announced the appointment of Marcelina "Marcy" Andaya Feit to the Independent Citizens Oversight Committee overseeing California’s stem-cell research initiative, which was created when voters approved Proposition 71 in 2004.

"Ms. Feit is the President and CEO of ValleyCare Health System, a non-profit healthcare system with hospitals in Livermore and Pleasanton. Valley Care Systems also operates a skilled-nursing facility, a geriatric-psychology program, and a health and wellness center.

"'Ms. Feit has spent her entire 32-year career in Central Valley health-care programs,' Bustamante said. 'She is a registered nurse who began her career as a surgical nurses’ aide and advanced through the ranks to become one of the few minority women to become a chief executive officer of a California health-care system.

"'She is a native of Stockton and the daughter of a farmer. She spent her youth in the Stockton area and was graduated from Manteca High School. She worked her way through nursing school and earned a Master of Science Degree in Nursing Administration.

"'She has a life-long commitment to improving health care for Central Valley residents, particularly those in rural areas. Her tenacity and her tireless efforts to overcome many obstacles in her career have provided her with the tools and the strength to greatly benefit the work of the Independent Citizens Oversight Committee.

"'Ms. Feit has made a formal commitment to seek policy guidance from medical providers and activist groups in Central Valley communities. Californians are very fortunate to have a person with her medical knowledge and management skills on the Independent Citizens Oversight Committee.'

"The Lieutenant Governor has five appointees on the committee. Ms. Feit fills the position for an appointee from a 'Type II Diabetes advocacy group.'

"Ms. Feit helped spearhead the Livermore Center of Excellence in Diabetes, which provides inpatient and outpatient care for individuals with Type I, Type II or gestational diabetes. The program also provides diabetes counseling, group support, nutritional advice and education services to the community. The American Diabetes Association has certified and recognized the Center of Excellence in Diabetes for its high quality of self-management education."

Reviewers Unaware of Funding Shortfall?

Some of the scientists who reviewed the training grants authorized by the California stem cell agency may not have known that no funds were available, according to The Scientist.

In an article on the grant program, writer Alison McCook said, "Stuart Orkin, Dana-Farber Cancer Institute researcher and cochair of the committee that reviewed the grant applications, told The Scientist that committee members did not consider where the money was coming from when awarding grants, and some likely didn't even know about the ongoing legal battles."

The reviewing scientists ranked the proposals on scientific merit as part of the process of making recommendations for funding to the stem cell Oversight Committee.

McCook also interviewed Dennis Clegg, chair of the department of molecular, cellular and developmental biology at the University of California, Santa Barbara, a grant recipient. He was quoted as saying, "We can't write checks yet."

That appears to be contrary to the expectations of California stem cell leaders, who had expressed hope earlier that grant recipients would proceed with the programs and seek reimbursement later. One suspects the response to that expectation would vary, depending on how flush a particular recipient is.

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