Monday, October 14, 2019

California Stem Cell Health Dividends: A Whopping $900 Billion? Maybe Only $175 Billion?

A team of University of Southern California researchers said today that work by California's stem cell agency could pay off with nearly $900 billion in "health dividends" by 2050 by treating or curing afflictions ranging from diabetes to heart disease.

The study, commissioned by the agency, acknowledged the difficulty in forecasting the benefits of research backed by the the state program, which is unprecedented in California history. But the report said,

"We find that nearly half of Californians aged 50 and older will develop diabetes during their lifetime. Furthermore, more than one-third will experience a stroke, and between 5 and 8 percent will develop either breast, colorectal, lung, or prostate cancer.  
"Taking into account the high prevalence and the social and economic burden of these diseases, an intervention that reduces the incidence of these selected cancers, diabetes, and stroke by 50 percent would generate almost $900 billion in social value between 2018 and 2050.  
"A more modest 10 percent decline in incidence translates to $175 billion in social value during the same period. Put in this context, the CIRM investment would be worthwhile if it increased our chances of success even modestly. Against the billions of dollars in disease burden facing California, the relatively small initial investment is already paying dividends as researchers work to bring new therapies to patients."
The agency, known formally as the California Institute for Regenerative Medicine (CIRM), was created by voters in 2004, who provided it with $3 billion. It has yet to fund a product that is widely available to the public. However, the agency is involved in 56 clinical trials, which are the last stage before a treatment is certified for widespread use.

CIRM expects to run out of cash for new awards by the end of this month. It hopes that a proposed initiative for the November 2020 ballot will provide it with an additional $5.5 billion. 

Today's report, titled "Future Health Dividends for California," and its companion study last week on the agency's economic impact are likely to be significant topics during the 2020 campaign. 

The 22-page study came up with a "social value" calculation using the Future Elderly Model -- "a microsimulation model of health and economic outcomes for older Americans." Basically it involves quality of life outcomes as well as more straight forward financial projections. The study also lays out its methodology and limitations including an acknowledgement that the projections are not guaranteed. 

Today's report and last week's economic study cost CIRM a total of $206,000. The work was performed at USC's Leonard D. Schaeffer Center for Health Policy & Economics. The authors are Bryan Tysinger, Karen Mulligan, Henu Zhao, Alwyn Cassil  and Dana Goldman.

Here is a link to an item on the CIRM blog about the study.
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Sunday, October 13, 2019

Making Changes in a $5.5 Billion Stem Cell Matter: What California Law Permits

Screenshot from state Department of Justice "active measures" website

A  California ballot proposal to spend an additional $5.5 billion over another 10 years on stem cell research is not locked in concrete or in even locked in its dense, legal language.

It can actually be modified between now and Nov. 17 if its sponsors so desire. That may be a big if, but it is possible as a result of 2014 changes in state elections law.

Here is the way it works. Any member of public can comment or suggest changes in proposed ballot initiative between now and Nov. 12 on this state web site.  The Department of Justice will pass along the suggestions to the sponsor of the initiative. The sponsor can make changes in the initiative up to Nov. 17.

Whether changes actually occur depends on pressures brought to bear by various constituencies that have something at stake in this multibillion-dollar game. Those interests include most of the Golden State's major universities and research institutes, the biotech industry, the fledgling California stem cell industry, patient advocate groups ranging from diabetes to cancer and even national regenerative medicine groups, not to mention religious or other groups that may have ethical concerns.

Of course, suggestions do not have to be filed with the attorney general. They can go directly to Robert Klein, who filed the initiative. Klein is a Palo Alto real estate investment banker, who founded the stem cell advocacy group, Americans for Cures. He led the 2004 campaign to create the agency and served as its first chairman. Klein directed the writing of the 2004 initiative as well as the current proposal.

His group also has a scientific advisory board that includes a host of California stem cell luminaries ranging from Irv Weissman of Stanford and Larry Goldstein of UC San Diego to Leslie Thompson of UC Irvine and Arnold Kriegstein of UC San Francisco. Klein has said he consulted with them in drafting the latest ballot proposal. They may well be interested in hearing comments on what is now being offered.

The California Stem Cell Report has already heard murmurings about changes that backers of the agency would like along with similar thoughts from opponents. But the measure is quite fresh and 30 pages long. So it may take a little time for solid suggestions for changes to emerge. 

The governing board of the stem cell agency, known formally as the California Institute for Regenerative Medicine (CIRM), has scheduled a meeting for Oct. 31, its first since the initiative was filed. It is expected to act on a number of awards, which are expected to be its last new awards until it receives additional funds. 

Asked last Friday whether board might make suggestions for changes in the initiative, Kevin McCormack, senior director for communications, replied via email, 
"Right now the CIRM board hasn’t taken a position on it. At some point in the future the board will discuss the initiative at a public meeting and take a position."
Here is the contact link for Klein's Americans for Cures and the email address for the stem cell agency: info@cirm.ca.gov 

Re the suggestion period and amendments to the initiative, here is the salient language from the California Secretary of State, the state's top elections official.
"Once a request for a circulating title and summary has been submitted, the Attorney General’s Office will post the text of the proposed initiative measure on their website and facilitate a 30- day public review process during which any member of the public may submit written public comments to the Attorney General’s Office via their website. The Attorney General’s Office will provide any written public comments received during the public review period to the proponent(s). (Elections Code § 9002(a).) During the public review period, amendments signed by all of the proponent(s) may be submitted to the Attorney General’s Office. Any amendments to the proposed initiative measure must be reasonably germane to the theme, purpose, or subject of the initiative measure as originally proposed. An amendment shall not be accepted more than five days after the public review period is concluded. (Elections Code § 9002(b).)"


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Friday, October 11, 2019

It's Official: $5.5 Billion Ballot Measure Filed for California Stem Cell Agency

Backers of the financially stressed California stem cell agency yesterday filed their proposed ballot measure to refinance the agency with $5.5 billion if voters approve it in November 2020.

The complex, 30-page initiative would also restructure a number of aspects of the agency and provide for financial assistance for patients and their families who might be involved in clinical trials. The proposal was submitted by Robert Klein, the Palo Alto real estate investment banker who led the ballot campaign that created the agency in 2004. 

Klein was also the first chairman of the agency, known formally as the California Institute for Regenerative Medicine (CIRM).  He is chairman of the stem cell advocacy group, Americans for Cures.

The $3 billion agency expects to run out of cash for new awards at the end of this month.

In addition to stem cell research, the proposed initiative would provide for awards for other "vital research" opportunities. 

Training for professionals would emphasized. The governing board of the agency would be increased from 29 to 35 persons. Representatives of the California state university system would have a greater official role in addition to representatives from the University of California. 

Additional changes are proposed in priorities along with alteration in conflict of interest rules and its public records provisions.

The measure, "Initiative No. 19-0022," will need 633,212 valid signatures to qualify for the ballot. The first step in the months long process is review of the measure by the attorney general's office, which will prepare the official summary.

The initiative said,
"Although California's stem cell research funding institute has made great gains, much work remains to be done. With new federal restrictions on important research, an anti-science agenda on the rise, and threats to reduce federal research and development funding, California once again must take the lead to ensure that this promising area of research continues and to advance projects from the research stage to the clinic. 
"Without additional funding, many of these promising research and development projects will be forced to stop work on potentially life-changing medical therapies. California's stem cell research institute needs additional funding to help bring promising discoveries through the development process, including clinical trials, with the goal of making treatments available to California patients with chronic diseases and injuries"
The public can file comments on the proposal at this page on the web site of the attorney general. 


(An earlier version of this article did not include the paragraphs beginning "Although California's..." and "Without additional...") Sphere: Related Content

Thursday, October 10, 2019

Critics Unmoved by Economic Report; Still Say No More Billions for California's Stem Cell Agency

This week's relatively rosy report on the economic impact of California's $3 billion stem cell research program has not convinced longtime critics to change their positions and support giving it an additional $5 billion.

In the eyes of some opponents, the stem cell agency is still a boondoggle, a waste of money and an inappropriate use of state bonds, the borrowed money that is the only significant source of cash for the program. Other critics recommended moving the program to the University of California and restricting it to "breakthrough medicine."

The agency, known formally as the California Institute for Regenerative Medicine (CIRM), expects to run out of money for new awards this month. It is hoping that voters will see value in its efforts and approve -- in November 2020 -- a $5.5 billion ballot initiative that would refinance the agency.

The 2004 initiative that created CIRM was handily approved by 59 percent of the voters following a campaign that created expectations that nearly miraculous therapies were right around the corner. The agency has yet to back a treatment that is widely available to the public.

The California Stem Cell Report queried a smattering of CIRM's critics following the release of the economic study, which said the agency has provided a "handsome dividend" to the state. The report from USC said, among other things, that CIRM-generated benefits exceed $10 billion and have led to nearly 60,000 jobs.

That was not good enough for state Sen. John Moorlach, R-Costa Mesa. He said,

"It was a boondoggle when it started and it still is. It's held up by emotional appeals, sustained by empty promises, and now rationalizing to extend its existence."
He continued,
"This study does not bring to light anything new. Doling out $3 billion to any entity or entities would generate the same economic metrics. The study is a shell."
"CIRM did not produce or sell anything of substance. It was not a stadium that created jobs around it, like restaurants, bars, and hotels."
Marc Joffe, a senior policy analyst at the Reason Foundation, said,
"I oppose the use of state general obligation bonding authority for any purpose other than building well-conceived civil infrastructure projects. The fact that spending bond proceeds generates economic activity is not surprising and not a reason to support a new bond in 2020. Similar studies have been released in support of the ill-conceived high-speed rail project: We might not get a usable system that takes many passengers out of their cars, but at least we created a lot of jobs in the Central Valley! This is not a persuasive argument for imposing more debt on our children, who already have the challenge of paying for Baby Boomer retirements."
Joe Rodota also responded. Rodato has worked for two Republican California governors. He and Bernard Munos, a senior fellow with FasterCures and the founder of the Innothink Center for Research in Biomedical Innovation,
have advocated a change in California's stem cell program that would restrict funding to businesses with a significant California presence and move the effort to the University of California.

Rodota said,

"Under our proposal, in exchange for providing funding to private companies engaged in developing stem-cell therapies, the University of California would receive shares, alongside any shares sold to private investors. Although the report categorizes equity sold to private investors as part of the 'economic stimulus created by CIRM funding,' that equity is held by private investors, not the University of California."
You can read the full text of the critics' remarks here. 
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Full Text: Critics on Economic Impact Report on California Stem Cell Agency

Here is the full text of the email responses of stem cell agency critics to the report on the economic impact of the agency over the last 15 years.

State Sen. John Moorlach, R-Costa Mesa, who responded directly to questions from the California Stem Cell Report (CSCR):

CSCR: "Does the USC study bring something to light that is new to you?"
Moorlach: This study does not bring to light anything new. Doling out $3 billion to any entity or entities would generate the same economic metrics. The study is a shell.
"CIRM did not produce or sell anything of substance. It was not a stadium that created jobs around it, like restaurants, bars, and hotels.
"CIRM spent $3 billion and it's costing the taxpayers that much, plus $800 million-plus in interest."
CSCR: "Does it lead you to modify your thinking about the California stem cell program?"
Moorlach: "The new report has not modified my thoughts on CIRM. It was a boondoggle when it started and it still is. It's held up by emotional appeals, sustained by empty promises, and now rationalizing to extend its existence."
CSCR: "What is your overall view of the agency at this point?"
Moorlach: "Stem cell research is important, but best left to the private sector. This was style drift and extremely expensive, including the necessity to raise taxes with Propositions 30 and 55."
From Marc Joffe, senior policy analyst with the Reason Foundation:
"I oppose the use of state general obligation bonding authority for any purpose other than building well-conceived civil infrastructure projects. The fact that spending bond proceeds generates economic activity is not surprising and not a reason to support a new bond in 2020. Similar studies have been released in support of the ill-conceived high-speed rail project: we might not get a usable system that takes many passengers out of their cars, but at least we created a lot of jobs in the Central Valley! This is not a persuasive argument for imposing more debt on our children, who already have the challenge of paying for Baby Boomer retirements."
"Also, for what it’s worth, I don’t oppose the existence of CIRM. If it can be financed privately, that would be wonderful. I just don’t think it should be imposing burdens of future taxpayers."
From Joe Rodota, who worked for Republican Gov. Pete Wilson and Republican Gov. Arnold Schwarzenegger.
"This sentence (from the study) caught my attention 
"The estimates in the report are based on the economic stimulus created by CIRM funding and by the co-funding that researchers and companies were required to provide for clinical and late-stage preclinical projects. The estimates also include:
"Investments in CIRM-supported projects from private funders such as equity investments, public offerings and mergers and acquisitions, 
"Our (Rodota's) proposal, as outlined here, includes this language:
"In exchange for the funds they receive, companies would tender to the University of California shares of their common stock, with an estimated value as determined by the most recent outside valuation or price set by investors. These shares would become part of the UC endowment -- and the University of California be free to sell or leverage these shares, or acquire additional shares, as it sees fit.

"Under our proposal, in exchange for providing funding to private companies engaged in developing stem-cell therapies, the University of California would receive shares, alongside any shares sold to private investors. Although the report categorizes equity sold to private investors as part of the 'economic stimulus created by CIRM funding,' that equity is held by private investors, not the University of California."
Sphere: Related Content

Wednesday, October 09, 2019

'Handsome Dividend' -- California Stem Cell Agency and Its Economic Impact on the Golden State


This video was produced by Forty Seven, Inc., a firm in which California's stem cell agency has invested more than $15 million

California’s stem cell research program has had a “major impact” on the state’s economy, generating billions in sales revenue and creating tens of thousands of new jobs, according to a study released today.

Commissioned by the $3 billion state stem cell agency, the report comes as the program is hitting a difficult financial patch. Known officially as the California Institute for Regenerative Medicine (CIRM), the agency expects to run out of money for new awards by end of this month. CIRM is hoping that voters will refinance it with $5.5 billion via a ballot initiative in November 2020.

The 84-page study is expected to serve as a rebuttal to critics who have called the nearly 15-year-old agency a boondoggle. The report said, 
“The state’s investment in (the agency) has paid handsome dividends in terms of output, employment and tax revenues for California."
Adam Rose, USC photo
Dan Wei, USC photo
The study and a yet-to-be released companion report were commissioned at a cost of $206,000 by the agency. The economic study was prepared by Dan Wei and Adam Rose of the Price School of Public Policy at the University of Southern California

Maria Millan, CEO and president of CIRM, said in a news release that the study reflects the agency's role in building a stem cell "ecosystem" in the Golden State. 

Beyond CIRM's medical and scientific work, she said that the agency is "promoting economic growth in California  by attracting scientific talent and additional capital, and by creating an environment that supports the development of businesses and commercial enterprises in the state."

The report summarized CIRM's economic impact in four points. 
  • "$10.7 billion of additional gross output (sales revenue)
  • "$641.3 million of additional state/local tax revenues
  • "$726.6 million of additional federal tax revenues
  • "56,549 additional full-time equivalent jobs, half of which offer salaries considerably higher than the state average."
CIRM's news release on the report characterized the study as "independent." CIRM said it showed that the agency's efforts had a "major impact" on the state's overall economy, which totalled $3 trillion in 2017. 

The agency cited the assistance it has provided to create companies that ultimately will make CIRM-financed therapies available to the public at large.

While the agency's spending has not yet led to a widely available therapy, it is backing 56 clinical trials, which is the last stage before a treatment can be approved for widespread use. About 86 percent of clinical trials fail to result in a product, according to 2018 figures.

As an example of a fruitful collaboration, the agency cited Orchard Therapeutics of the United Kingdom, which plans to seek to qualify soon for speedier federal approval of its treatment for a version of  "bubble boy syndrome," a fatal immune deficiency. CIRM has awarded the firm $8.5 million.

The treatment was developed by Donald Kohn at UCLA with the help of $52 million in CIRM cash During clinical trials, it has saved the lives of more than 50 babies. Kohn said in a statement,
"I think one of the greatest strengths of CIRM has been their focus on development of new stem cell therapies that can become real medicines."
Orchard has offices in the San Francisco Bay area and plans to build a 150,000-square-foot manufacturing facility in Fremont. 

Also cited as an example was a company called Forty Seven, Inc., of Menlo Park, Ca., which is developing cancer therapies. Mark Chao, founder of the firm, said CIRM's support was "instrumental to our early successes."

The economic study also explored the "deal flow" funding that has aided commercialization of research. The study said it is expected that 
"...CIRM's past and current funding will attract increasing amounts of industry investment and lead to additional spending injections into the California economic in the years to come."
The companion report to today's economic study involves "health dividends" provided by the agency. That report is expected to be released next week. 

The agency has commissioned other economic studies in the past including one in 2012 that also lauded the agency. The request for proposals to perform that 2012 study said it must execute "a vibrant and aggressive strategy to support the goals and initiatives of CIRM.” 

Queried by the California Stem Cell Report, Kevin McCormack, a spokesman for CIRM, said four enterprises were solicited to develop this year's study. Three declined. The contract for the latest study stipulated that USC had control of the content. The latest study also laid out the methodology in considerable detail, something missing from the 2012 report. 

Below is a May 31, 2019, 58-second video of the president of Orchard, Mark Rothera, discussing the company's work. More brief, 2019 videos of Rothera from same interview sequence can be found hereherehere and here. The videos were taken by the Alliance for Regenerative Medicine
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Thursday, October 03, 2019

California's $72 Million Diabetes Wager: ViaCyte Announces Major "Firsts" for Its Stem Cell Therapy


Vox Pop video/Viacyte

One of California's bigger stem cell bets -- $72 million -- turned up this morning with a strong positive report that included a couple of "firsts" in its search for a virtual cure for diabetes.

The announcement came from ViaCyte, Inc., of San Diego. The California stem cell agency has pumped $72 million into the company, making the firm the top for-profit recipient of state stem cell largess. 

The news comes as the agency, known formally as the California Institute for Regenerative Medicine (CIRM), is running out of funds and hoping that voters will give it $5 billion more. A major research score would be a big plus for that ballot initiative effort. 

The agency's president, Maria Millan, described the ViaCyte announcement as important and encouraging. 

ViaCyte is developing a tiny device that is implanted in a person's body and that generates insulin as needed. It is aimed primarily at type one diabetes, which afflicts more than one million Americans 

ViaCyte issued a news release on the developments at major, national stem cell conference in Carlsbad, Ca. The headline on the release said, 
"First demonstration of insulin production in patients from a stem cell-derived islet replacement therapy"
The release said,
"Preliminary data show that implanted cells, when effectively engrafted, are capable of producing circulating C-peptide, a biomarker for insulin, in patients with type 1 diabetes."
Paul Laikind, CEO and president of the firm, declared,
“ViaCyte is the first and only company in human clinical trials with a stem cell-derived islet replacement therapy candidate, and we are now the first to demonstrate production of C-peptide in patients receiving implanted stem cell-derived islets. These data show that our PEC-01 cells are functioning as intended when appropriately engrafted. “While there is still more work to be done, this is an important milestone. We plan to present additional data in the near future.”
Laikind continued,
“ViaCyte has achieved a number of firsts in this field. Now with the first demonstration of insulin production in patients who have received PEC-Direct, we are confident we can be the first to deliver an effective stem cell-derived islet replacement therapy for type 1 diabetes.”
Asked for comment, CIRM's Millan said,
"This is encouraging news. We are very aware of the major biologic and technical challenges of an implantable cell therapy for Type 1 Diabetes, so this early biologic signal in patients is an important step for the ViaCyte program."
ViaCyte is scheduled to present its findings later today at the Cell & Gene Meeting on the Mesa. That session can be seen live on the Internet 1:45 p.m. PDT. 

(An earlier version of this item contained a slightly different quote from Millan. CIRM re-submitted the latest quote, which adds information.) Sphere: Related Content

Monday, September 30, 2019

Measure to Add $5 Billion-plus to California Stem Cell Agency Yet to be Filed

The official kickoff for a proposal to refinance California's nearly 15-year-old stem program with $5.5 billion has been delayed for at least a few more weeks. 

Backers of the proposed bond initiative told the California Stem Cell Report last week that the ballot measure will not be filed with state election officials until later in October. Previously, they had said it would be filed by the end of this month. 

Melissa King, executive director of Americans for Cures, said there was no major reason for the delay in filing the measure. She said it was just a matter of "wanting to get everyone's views heard, etc."

To qualify for the November 2020 ballot, backers will need to gather more than 600,000 signatures of registered voters. 

Americans for Cures is a stem cell advocacy group controlled by Robert Klein, who ran the initiative campaign in 2004 that created the California Institute for Regenerative Medicine (CIRM), as the agency is formally known.
Klein was also the first chairman of CIRM. 

The agency expects to run out of cash for new awards this year and has no further source of major funding.  Sphere: Related Content