Monday, November 18, 2019

Rare Media Coverage of $5.5 Billion California Stem Cell Ballot Measure

The journal Science is carrying an article about the "delicate negotiation" involving the California stem cell agency and the man who is sponsoring a ballot measure that would keep the research effort alive with $5.5 billion in cash. 

The piece by Kelly Servick followed a two-hour meeting last Friday of the governing board of the agency, formally known as the California Institute for Regenerative Medicine (CIRM). Klein was in attendance and agreed to additional changes in the measure beyond those he announced to the California Stem Cell Report. 

There was no disagreement between Klein and the agency concerning the amount of money involved, which is much needed by CIRM. It has only $27 million left, compared to the up to $300 million annually that it normally spends on awards. The $27 million is earmarked for sickle cell anemia. 

The piece in Science represented rare national or even California media attention to refinancing the agency, which has pumped $2.7 billion into stem cell research in the Golden State in the last 15 years. Beyond the refinancing, the Klein initiative would make sweeping changes in the agency and governance. It also does not deal in a significant way with some areas that have been the focus of sharp criticism over the years, such as conflicts of interest.

Servick's article captured some of the highlights of last Friday's CIRM board meeting. She also reported, 
"In July, Americans for Cures conducted a poll of about 1150 likely voters and found a 65% approval rating for re-funding CIRM, Klein says."
Servick wrote, 
"Many researchers credit the agency with creating a strong infrastructure for stem cell research in the state and shepherding dozens of experimental treatments into human trials. But no CIRM-funded stem cell therapy has yet won FDA approval, leading critics of the agency to ask whether the initial 2004 initiative, born from opposition to a ban on federal funding for embryonic stem cell research, promised 'cures' it couldn’t deliver." 
Klein has until 5 p.m. today to file his amended initiative with state election officials. If it qualifies for the ballot with more than 600,000 signatures it will be brought to voters next November.


Sphere: Related Content

Friday, November 15, 2019

$5.5 Billion Stem Cell Ballot Measure: Questions in California but Apparently No Foot-Dragging

Some directors of the California stem cell agency this morning expressed a number of reservations about a $5.5 billion ballot initiative to stave off its financial demise, but none appeared likely to oppose the proposal 

In a special, two-hour meeting of the agency's governing board, questions were raised about provisions that would restrict the board or mandate programs, ranging from training to lab equipment. A provision to increase the size of the board from 29 to 35 was criticized and supported. A new effort to deal with the affordability of stem cell therapies was praised. But some aspects were questioned.   

The topic of the day was a complex, 30-page, proposed ballot initiative sponsored by Robert Klein, the first chairman of the agency, who has already announced changes in his proposal. More alterations appeared to be in the works as the result of today's hearing, including elimination of some language dealing with pricing. The meeting did not go into details about that subject.

In addition to requiring the state to borrow $5.5 billion for stem cell and other "vital" research, Klein's proposal would expand the scope of the agency and alter its governance. It would be required to develop and finance efforts at making stem cell research more affordable. Brain disease research would receive special attention with a dedicated $1.5 billion out of the $5.5 billion. Training programs would be mandated and expanded at community and state colleges and much more.

(The CIRM summary of the initiative can be found here. A summary by the California Stem Cell Report can be found here.)

(Here is the text of the initiative as filed in October. Here is the text of the measure with Klein's proposed changes as of Nov. 14.)

The agency began its life in 2004 with $3 billion in state bond funding, authorized by California voters through a ballot initiative.  Known formally as the California Institute for Regenerative Medicine(CIRM), it is down to its last $27 million, which is devoted to a sickle cell program with the federal government. At its peak, the agency was giving away up to $300 million a year.

Today's meeting began with several of the board members declaring that the public should not perceive their questions and comments as indicating they did not support the effort to refinance the agency. Some had expressed concerns that opponents might use board comments to defeat the initiative next November. 


Steve Juelsgaard
CIRM photo
The board moved rapidly through the initiative during the morning meeting. CIRM director Steve Juelsgaard and others raised questions about the size of the board, declaring that large boards become disengaged from an enterprise. Os Stewart, who has served on the board since 2004, said he initially thought 29 members were excessive but feels differently after 15 years. 

Several members expressed concern about mandates that would tie the hands of the board. CIRM Director Francisco Prieto said, 
"The science can surprise us."
Klein told the board that "we have fundamental obligation to give the voters an idea where their money is going." He also said that the mandates do not have legal timetables.

Today's meeting was very lightly attended, according to an agency spokesman, mostly by CIRM staffers. Only one member of the public addressed the board, Don Reed, a longtime patient advocate and supporter of the board.

Questions about the measure arose publicly this month after longtime director
Jeff Sheehy
CIRM photo
Jeff Sheehy authored a 3,300-word critique of the Klein measure, declaring it amounted to "too little and too much."  At the end of today's meeting, Sheehy did not express reservations that would prevent him supporting the measure. 


Klein unofficially modified his measure this week. He has until Monday at 5 p.m. to actually file the changes with state elections officials. The official comment period for the initiative is closed. But Klein said yesterday that interested parties can send comments and suggestions to him through Saturday at this email address: castemcell2020@gmail.com. 

Comments filed directly with Klein are not a public record. If a reader would like to share his/her comments with the public, please send a copy of them to the California Stem Cell Report at djensen@californiastemcellreport. We will carry them verbatim.

Here is a link to a guide to the stem cell initiative information maze, which is updated as other key information surfaces. Sphere: Related Content

California Stem Cell Agency's Summary of $5.5 Billion Measure to Save its Financial Life

The California stem cell agency late yesterday posted its own summary of a proposed $5.5 billion ballot initiative to keep it from basically going out of business next year.

The summary is about 1 1/2 pages long compared to the 30 pages of the actual initiative, which is the subject of a hearing this morning by the governing board of the agency. 

The California Institute for Regenerative Medicine (CIRM), as the agency is formally known, is down to its last $27 million. It came into being in 2004 with $3 billion in state bond financing. 

Also posted on the meeting's agenda is a five-page memo from 2017 discussing what the agency can and cannot do in connection with election activities such as a ballot initiative campaign.  Last month the board was given a seven-page memo about such activities. Both memos confirm that the agency may use public funds to draft its own initiative.

Neither of the memos discuss the pros and cons of the ballot measure sponsored by Robert Klein, who ran the ballot campaign that created the stem cell agency 15 years ago this month.

Here is an updated guide to the key documents and information concerning the initiative.

Sphere: Related Content

Thursday, November 14, 2019

Robust Defense of $5.5 Billion California Stem Cell Measure; State Hearing Scheduled for Tomorrow Morning

The man behind the $5.5 billion California stem cell initiative this afternoon vigorously defended the measure and released details of fresh changes in the proposal, which will be scrutinized tomorrow morning by the directors of the financially strapped state stem cell agency.

Robert Klein file photo by California Stem Cell Report
Despite the fact that agency faces its fiscal demise next year, the initiative is the only proposal around to continue the agency's funding. It ran afoul last week of questions from some of the agency's directors. One of those directors wrote a 3,300-word critique of the proposal by Robert Klein, the first chairman of the agency and who directed the writing of the 2004 ballot initiative that created the agency. A special meeting was called for tomorrow morning.

In addition to providing $5.5 billion in state bonds, Klein's proposal would significantly expand the reach and change the governance of what is formally known as the California Institute for Regenerative Medicine(CIRM). The measure would require the agency to launch a major effort to make "affordable" what are extremely expensive stem cell and genetic treatments. The proposal would also enlarge its governing board from 29 to 35. The board has been criticized sharply for the size of its board.

Klein said in an emailed statement that the changes he made in the wake of CIRM directors' concerns basically follow the outlines of what he released yesterday. He stoutly defended the agency's current work and his plans to expand its scope.

He said in an eight-page statement to the California Stem Cell Report.
"Patients and their families should not have to suffer more delays because of ill-conceived agendas that obviously do not fit into the new initiative, with a scope that has already been court validated."
Klein added,
"The federal government remains a threat to scientists and physicians investigating the best cell sources for developing therapies for patients. Just within the last nine months there have been new restrictions imposed by the federal government based upon ideological grounds."
Klein, a Palo Alto, Ca., real estate developer, is under a state deadline of 5 p.m. on Monday to make any changes. As sponsor of the 2020 initiative, he is the only person legally entitled to make changes. The measure then will go through a lengthy state elections process. More than 600,000 registered voters will have to sign petitions for the measure if it is to make it onto the November 2020 ballot.

Klein noted that the state deadline has passed for officially making public comments. But he said suggestions and comments can be sent to him through Saturday Nov. 16 at this address: castemcell2020@gmail.com.  Any such comments are not a public record. If a reader would like to share his/her comments with the public, please send a copy of them to the California Stem Cell Report at djensen@californiastemcellreport. We will carry them verbatim.

The public can listen in and participate in tomorrow's meeting via the Internet or at telephonic locations throughout California. An updated list of those locations is here. Information on Internet access is on the meeting agenda.

Below is the text of the statement Klein sent this afternoon to the California Stem Cell Report. In it, he says the full text of the current version of the actual initiative is available on the Americans for Cures web site, a stem cell patient advocacy group that he founded and chairs.





Sphere: Related Content

A Guide to Information on the $5.5 Billion California Stem Initiative

Trying to wade through the information maze surrounding the proposed, $5.5 billion California stem cell initiative? Here are links to key documents, online postings and information dealing with the proposal and the ballot initiative process.

This list of information sources was updated Nov. 14, 2019, at 8:54 PM PST.

How ballot initiatives work in California

Text of the 30-page, proposed $5.5 billion measure

Text of the revised version of initiative as of Nov. 14, 2019

A summary of the measure from the California Stem Cell Report

A summary of the measure from the stem cell agency

A critique of the proposal by CIRM board member Jeff Sheehy

A critique of the proposal by CIRM grant recipient Jeanne Loring

An eight-page statement from Robert Klein, author of the initiative, to the California Stem Cell Report.

Proposed changes in the initiative offered by its sponsor, Robert Klein

How CIRM can write its own initiative

An article on CIRM board reaction to the initiative, complaints about "handcuffs" Sphere: Related Content

Delays on Details of Changes in Proposed, $5 Billion California Stem Cell Initiative

The details of the changes in the proposed 2020 California stem cell initiative that were promised by its sponsor yesterday have not been received as of this writing. The California Stem Cell Report will carry them when they are received.  The governing board of the state stem cell agency is scheduled to meet at 9 a.m. tomorrow to consider the initiative. Sphere: Related Content

Wednesday, November 13, 2019

Changes Afoot in $5.5 billion California Stem Cell Initiative: Sponsor of the Measure Reacts to Suggestions and Questions

The proposed $5.5 billion California stem cell initiative is being altered in the wake of questions raised by some members of the governing board of the state stem cell agency, which is facing its financial demise unless the measure is approved by voters next fall.

In a phone conversation and email this evening, Robert Klein, sponsor of the initiative, said a "substantial amount of disinformation and misperceptions" exists concerning the measure. He said he was altering three key areas dealing with ethics and conflicts of interest, affordability and creation of a new scientific advisory board. 

Klein is the only person at this point who can modify his initiative. The state-imposed deadline is Monday at 5 p.m.  The governing board of the agency, known formally as the California Institute for Regenerative Medicine (CIRM), is scheduled to meet at 9 a.m. on Friday to consider the Klein initiative. This week's meeting was scheduled following a testy board discussion last week. 

Klein directed the writing of the 2004 initiative that created CIRM with $3 billion in state bond funding. Only $27 million is left, and it is earmarked for sickle cell research. Klein also directed the 2004 ballot campaign and was the agency's first chairman. 

Klein said he has received hundreds of comments about the proposed initiative, which makes sweeping changes in CIRM and the way it works. Klein's initial email about the changes in the measure is brief. The full text is  below. He said he would send more details about the changes later this evening and was open to more suggestions as they come in. (Update: As of 5:49 a.m. PST today Nov. 14, Klein had not delivered the details of his changes, which will be carried on the California Stem Cell Report when they are received.)

Here is Klein's email to the California Stem Cell Report.


"There is a substantial amount of disinformation and misperceptions being spread about the 2020 Initiative. I have addressed 3 areas of clarification below. Later today I intend to complete a more in-depth statement that covers a large number of points, which I will send to you upon completion. I hope the information below will provide a starting point for clarifying the understanding of a number of provisions.

"Amendments
"Although counsel assured me that the original wording in the 2020 initiative, as to any adoption of National Academy of Science standards for ethics or conflicts, was discretionary for the board, there will be posted on the Americans for Cures website, and distributed to CIRM, revised language that specifically states that the adoption of any part of the National Academy standards would be discretionary for the board. The requirements for open meetings to change any standards has not been modified. It remains in place.

"In addition, I have received helpful comments on the Accessibility and Affordability Working Group; and consequently, I have modified those sections to make it clear that the focus of this group is to work with designated experts on achieving early public and private insurance coverage for therapies derived from CIRM funded research. Please read the language in this section (sec. 7, 125290.75) which also provides more description of the expertise and experience qualifications of the Working Group members recruited outside of the CIRM board members on this Working Group.

"For clarity of purpose, the provision that addressed a potential advisory board, selected by the President and the Chair, has been revised and relabeled as a “task force” authorizing section, for specialized objectives. The membership of any task force has been restricted to California residents. These task forces will not have any function in evaluating grants, which must be reviewed and evaluated by the “Grants Working Group,” as clearly required by the Initiative.

"As additional comments are received, further modifications will be considered.

"Thank you."

Americans for Cures is a stem cell advocacy group that Klein founded and chairs. Here are links to the actual initiative and also to a summary prepared by the California Stem Cell Report. 
Sphere: Related Content

From Royalties to 'Vital' Research Opportunities: A Summary of California's $5.5 Billion Stem Cell Measure

The proposed 2020 stem cell initiative for the California stem cell agency is much more than the $5.5 billion it provides to continue the operations of the state's stem cell enterprise. 

It would also make sweeping changes in the California Institute for Regenerative Medicine (CIRM), which is down to its last $27 million. They range from expanding the scope of the agency to restructuring its governance.

This article is an initial attempt to summarize the measure’s more important changes. It does not capture all of the implications and alterations that could affect CIRM. Readers may see other sections of the initiative that are of interest. If so, please email the California Stem Cell Report at djensen@californiastemcellreport.com. 


The deadline for the sponsor of the measure to make changes in the proposal is Monday at 5 p.m. Only the sponsor, who is Robert Klein, the first chairman of the agency, can make changes. 

Bond Financing and Interest Costs
The $5.5 billion would be provided through bonds (state borrowing) sold over a 10-year period. The interest on the bonds increases the cost to taxpayers as opposed to an annual appropriation. 

Expansion of Scope of Work 
The initiative’s purpose is “to support stem cell research to mitigate and/or cure chronic disease and injury” and also to finance “other vital research (opportunities) to develop treatments and cures for serious diseases and conditions like diabetes, cancer, HIV/AIDs, heart disease, paralysis, blindness, kidney disease, respiratory illnesses, and many more.” It also would “promote” accessibility and affordability of treatments by ensuring that more Californians have the opportunity to participate in clinical trials. (p.2)

“Other vital research opportunities” mean “scientific and medical research and technologies, includinq but not limited to qenetics, personalized medicine, and aqinq as a patholoqy, and/or any stem cell research not actually funded by the institute under paragraph (3) of subdivision (c) of Section 125290.60 which provides a substantially superior research opportunity, vital to advance medical science as determined by at least a two-thirds vote of a quorum of the members of the Scientific and Medical Research Funding Working Group and recommended as such by that working group to the ICOC (CIRM governing board), or as determined by the vote of a maiority of a quorum of members of the ICOC.” (p. 29) 

The measure would also: 
  • Expand the agency’s Alpha Clinic program and create “centers of excellence” to expand clinical trial locations based on geographic diversity.(p. 3) The measure prescribes specific criteria for decisions by the board. 
  • Require the board to establish and oversee affordability programs for CIRM-funded treatments. 
  • Create a new, 17-member affordability group (p. 5, p. 6, p. 20) to deal with a wide-range of affordability issues including development of financial models and funding of patient and caregiver expenses 
  • Require the agency to create new training and fellowship programs to help create a stem cell work force, including programs at the community and state college levels. (p. 4) 
  • Re-establish the “shared research laboratory” program to provide more training and equipment and to create lab access for neighboring institutions. (p. 5)  
Conflicts of Interest 
Conflict of interest provisions would be be guided by the National Academies of Science (NAS), an out-of-state organization with no requirement for open meetings. (p.18)

The NAS is a widely respected and 156-year-old, non-profit based in Washington, D.C. 

The initiative language says that standards must “be qenerally aliqned with those adopted by the National Academy of Sciences to the extent that such standards are consistent with constitutional and statutory requirements applicable to the institute.” (p. 15)

No conflict standards would be required in connection with discussion or enactment of strategic and concept plans and “research budgets.” (p. 13)

Grant Reviews and Selection of Reviewers 
The measure alters the composition of the grant review group that makes the de facto decisions on awards. The measure would continue the current practice under which reviewers are not required to disclose publicly their economic or professional conflicts of interest.   (p.22)

Reimbursement of expenses of research participants and caregivers would be permitted. (p. 16) 

New Scientific Advisory Board 
Creates a 10-member scientific advisory board with 50 percent from out of state. Five of the total would be appointed by the chair of the agency and five by the president. (p.7) 

Expansion of Board from 29 to 35 
In addition to adding six members to the governing board, the chancellor of UC San Francisco would get one additional appointment. Two nurses also would be added to the board. Representatives from the state college system would be eligible for appointment. (p.7, p. 9)

The proposal additionally:
  • Adds as criteria for selection of some board members “other vital research opportunities, therapy development, or therapy delivery,” “nursing” and “mental health” patient advocacy. Criteria for the board chairman would be expanded to include a “documented history” in “other vital research opportunity (sic) in therapy development and/or therapy delivery advocacy.” 
  • Allows for ouster of some board members with a half of a term left at the time of the passage of the measure when a new appointment is made. (p. 10) 
Public Openness and Transparency 
The proposal: 
  • Makes more information confidential including “progress reports” currently filed publicly by applicants. (p. 12)
  • Includes “applications” as confidential, although that is current practice. Currently the agency is excluded from some transparency requirements that apply to other state agencies. (p. 12)
Royalties and License Revenues 
Royalties, including interest on them, shall be, to “the extent permitted by law...appropriated for the purpose of offsettinq the costs of providinq treatments and cures arisinq from institute-funded research to California patients who have insufficient means to purchase the treatment or cure, includinq the reimbursement of patient-qualified costs for research participants.” Currently the royalties flow to the state's general fund. (p. 14)

Number of CIRM Employees/Budgeting 
The measure would allocate at least $1.5 billion, with conditions, for awards dealing brain diseases, including Alzheimer’s disease, Parkinson's disease, stroke, dementia, epilepsy, schizophrenia, depression, traumatic brain injury, brain cancer and autism. (p.2)

Costs of CIRM “working” and advisory groups, application reviews, consultants and research conferences would be designated as “research funding,” meaning that they would not come out of the agency’s administrative budget, which is capped at 6.5 percent of $5.5 billion. (p. 23, p. 28)

The proposal also:
  • Caps the number of employees nominally at 70 but allows the addition of 15 agency employees to deal with affordability issues. Also allows the addition of “employees funded throuqh sources other than bond proceeds or the (state) General Fund." (p. 19)
  • Enacts formulas that restrict the use of bond funds in various categories, including new clinical programs, affordability, buildings and research equipment. (p.23)
  • Establishes new rules and limits on indirect, administrative costs in grant awards, an important consideration for recipient institutions. (p.24, p.27)
Sphere: Related Content

Tuesday, November 12, 2019

Sacramento Biotech Interests Eyeing Proposed $5.5 Billion California Stem Cell Measure

The proposed $5.5 billion California stem cell initiative attracted some media attention this week in Sacramento in an article that said the area's biotech researchers and companies "are keeping a close eye on where those dollars go."

The piece by Felicia Alvarez in the Sacramento Business Journal outlined the impact of the state stem cell agency in the area and addressed the future should the measure win approval in November 2020. UC Davis has used $143 million from the agency to build its stem cell program. 

The article said more funding would dovetail nicely with plans for a development called Aggie Square by UC Davis at its Sacramento complex, which currently houses its stem cell program.  David Lubarsky, UC Davis Health CEO, said, 
“We believe many companies and life science manufacturers will gravitate to Sacramento and Aggie Square to align themselves with this technology."
Alavarez also wrote, 
"Aggie Square could eventually be expanded into a nationwide manufacturing site for stem cell-based medicines, and an eventual distribution hub, Lubarsky said."
However, Cate Dyer, CEO of StemExpress, expressed a desire for changes in the proposal. Dyer sits on the board of the UC Davis Institute for Innovation and Entrepreneuership. She said, 
“I would like to see some changes made to this bill in what Californians intended it to be — directly benefiting health care in California and returning the royalties and fees back to the state.”
Dyer also said some stem cell-related start up efforts out of UC Davis have struggled. Dyer said, 
“Students contact me all the time that are tied up in these agreements with the university that they can’t get out of. They can't get their business external enough that investors would want to come in.”
The Sacramento Business Journal article is a rare news story dealing with the proposed initiative, which would make sweeping changes in the state stem cell agency, formally known as the California Institute for Regenerative Medicine

Not all of those changes are beloved  by all members of its 29-member governing board, which has scheduled a meeting Friday morning to consider the proposal. (See here for a 3,300-word critique by one board member here. See here for an article on last week's sometimes testy discussion of the measure.)

Directors could, at Friday's meeting, make recommendations for alterations. The deadline for actually changing the terms of the measure is Monday at 5 p.m. The only person who can make changes in the proposal is Robert Klein, the sponsor of the measure and the first chairman of the stem cell agency. Directors of the agency have the choice of writing their own initiative as an alternative to Klein's or taking other alternative steps.

The meeting is open to members of the public, who can comment as well, at a number of locations throughout the state.  It is also scheduled to be available online.  Sphere: Related Content

Have Your Say on $5.5 Billion California Stem Cell Measure; Locations, Internet Access to Public Meeting Friday

The public can participate and listen in on the stem cell agency's meeting on Friday dealing with the proposed, $5.5 billion ballot initiative that could lead to changes in the measure. Some of the agency's board members have already expressed reservations. 

The session is scheduled for two hours beginning at 9 a.m. It will be available via the Internet and also at telephonic locations throughout the state. Here is a current list of the locations, including the stem cell agency headquarters in Oakland.  The locations could change. Instructions for Internet access can be found on the agenda
  • State stem cell agency -- 1999 Harrison Street Suite 1650, Oakland, CA 94612
Other Locations (updated Nov. 14, 2:36 p.m. PST):
  • 10901 N. Torrey Pines Road, La Jolla, CA 92037
  • 1001 Health Sciences Rd., Irvine, CA 92697
  •  291 Campus Drive, Stanford, CA 94305
  • 8700 Beverly Blvd 2015, Los Angeles, CA 90048
  • 583 Mrak Hall, 1 Shields Ave., Davis CA  95616
  • 100 Kimball Way, South SF, 94080
  • 12-231 CHS, David Geffen School of Medicine, UCLA
  • 4005 N Fresno St., Fresno, CA 93726
  • 837 Health Science Road, Irvine, CA 92697
  • 769 Evans Hall, University Dr, Berkeley, CA 94720
  • 8170 Laguna Blvd., Elk Grove, CA 95758
  • Marina Village Conference Center - 1936 Quivira Way, San Diego, CA 92109
  • 765 Market St. Apt 31D, San Francisco, CA 94103
  • 15775 Gum Tree Lane, Los Gatos, CA 95032
  • 10850 Gold Center Drive, Suite 325, Rancho Cordova, CA. 95670
  • 600 16th Street, Genentech Hall, S272D, San Francisco, CA  94158
Sphere: Related Content

Friday, November 08, 2019

Fresh Comment on CIRM's Abilitiy to File its Own Ballot Initiative

The vice chairman of the California stem cell agency board, Art Torres, today responded by email to a question about the possibility of the agency filing its own ballot initiative to provide billions in refunding for the agency. He was referring to an item posted earlier today headlined "Survival of the Financially Strapped California Stem Cell Agency? It Can Write Its Own Ballot Initiative."
Torres said,
"The agency could write its own initiative but no power to place it on the ballot or circulate it for signatures. I think the meeting on Friday is the best way to collect recommendations to pass on." 
As was noted in the item, a sponsor would have to be found to pick up whatever initiative that the agency might offer. Torres' comment has been added to the original item. 
Sphere: Related Content

Survival of the Financially Strapped California Stem Cell Agency? It Can Write Its Own Ballot Initiative

Directors of the California stem cell agency --- some of whom are not happy with a proposed $5.5 billion ballot initiative that would rescue the agency -- have a choice: They can write their own ballot measure. 

The agency, known formally as the California Institute for Regenerative Medicine (CIRM), is permitted under state law to draft its own ballot initiative, a provision that escaped notice at the governing board's meeting last week. 

It was during that session that the dissatisfaction among some CIRM directors  surfaced significantly. A number of board members expressed reservations about the proposed ballot initiative, which would make major changes in the agency's operations. "Not helpful," was one characterization. "Handcuffs" was another. 

Another meeting was called for a week from today (Nov. 15) to consider the $5.5 billion proposal, which has a deadline of Nov. 18 for making changes. Any alterations can only come from Robert Klein, the sponsor of the initiative and the first chairman of the 15-year-old agency. 

Not discussed last week's board meeting was a sentence in a legal memo prepared by James Harrison, the former general counsel of the agency. In addition to the memo, Harrison briefed directors with a slide presentation on the restrictions on the use of public funds to support a ballot initiative. The sentence said,
"However, a public agency may conduct research and draft a ballot measure because these activities are not aimed at persuading voters."
The California Stem Cell Report this week queried Jeff Sheehy, one of the less-than-pleased CIRM directorsfor a comment on the possibility of pursuing an alternative to the Klein initiative. He said in an email:
"I have to admit that I had no idea that CIRM could draft its own ballot measure. I am surprised that this option was not brought to the board earlier. I think CIRM drafting its own ballot measure is a great idea and we should start this process as soon as possible, assuming that the rest of the board supports doing so."
 (Update: In response to a question, Art Torres, vice chairman of the CIRM board, said following initial publication of this item today, 
("The agency could write its own initiative but no power to place it on the ballot or circulate it for signatures. I think the meeting on Friday is the best way to collect recommendations to pass on." )
Harrison made it clear last week that running a campaign is illegal for CIRM. Someone from outside the agency would have to step in to do that as well as raising the tens of millions of dollars needed to place it on the ballot and conduct the campaign.

CIRM, meanwhile, is running out of the $3 billion that voters provided it in 2004 and will have to start winding down next year unless voters provide it with more cash. The most obvious source has seemed to be the ballot measure offered up by Klein, a Palo real estate investment banker who also directed the writing of the initiative that created the agency in 2004.
Time is running out for initiatives for the November 2020 ballot. A lengthy signature gathering process is involved in addition to an array of statutory requirements. 

However, an initial draft of a measure -- sort of a placeholder -- could be submitted quickly after a sponsor stepped up. The measure could be fleshed out and refined during the 30-day comment period with revisions made after that period closes.

In another possible scenario, Klein could withdraw his current initiative if he needs time to consider changes desired by the board. A new proposal then could be drafted and submitted for fresh ballot certification. 

Supporters of the agency could also go to the state Legislature and ask lawmakers to place a funding measure on the ballot. That would involve some major political obstacles and negotiations. So far, CIRM directors have not been inclined to move in that direction.

Here is a link to additional legal discussion of how local California governmental agencies can engage in drafting a ballot initiative and placing it on the ballot.  Sphere: Related Content

Thursday, November 07, 2019

What's Old is New Again: Multibillion-dollars in Stem Cell Spending and Conflicts of Interest

Controversy about conflicts of interest at California’s $3 billion stem cell agency arose once again last week -- this time involving a plan to basically hand over conflict regulation to a prestigious, national organization that is virtually unknown outside of the scientific world. 

That little known group is the National Academies of Sciences (NAS), which doesn't rank high in anybody's breakfast table talk. However, the NAS has already weighed in with recommendations for solving conflicts of interest at the California stem cell agency. And the agency's board has said "neyt" to the NAS proposals.

Instead, the directors of the agency, formally known as the California Institute for Regenerative Medicine (CIRM), enacted their own, less sweeping changes to try to reduce the perception of conflicts of interest among the 29 members of the board.

Events last Thursday at the CIRM board meeting captured the essence of the conflict concerns. Nine awards totalling $54 million were involved. All went to enterprises that had links to institutions represented by CIRM board members. None of the board members tied to the recipient institutions was allowed to vote on the applications. 

However, the entire CIRM board makes the decisions that create the agency's grant programs, ranging from clinical trials to basic research. And over the years, roughly 90 percent of the $2.7 billion in CIRM awards has been swept up by institutions with representation on the agency's governing board, according to calculations by the California Stem Cell Report. 

Seven years ago, the NAS looked at that situation and other CIRM activities at the agency's behest. CIRM paid the NAS $700,000 for the work, done through what was then called the Institute of Medicine (IOM)

Here is how the chairman of the 13-person study group, Harold Shapiro, a former president of Princeton University, described the problem to the Los Angeles Times in 2012. 
“They (the CIRM directors) make proposals to themselves, essentially, regarding what should be funded. They cannot exert independent oversight.”
The report said, 
“Far too many board mem­bers represent organizations that receive CIRM funding or benefit from that funding. These com­peting personal and professional interests com­promise the perceived independence of the ICOC(the CIRM governing board), introduce potential bias into the board’s decision making, and threaten to undermine confidence in the board.” 
Issues about conflicts surfaced even before the agency came into being when opponents used matter during the 2004 ballot campaign that created the agency. 

The electoral effort to establish the agency was directed by Robert Klein, who also directed the writing of the initiative and then became the agency's first chairman. Klein, a Palo Alto real estate investment banker, has now submitted to state officials a new ballot measure to give the agency $5.5 billion more.

It would make major changes in the agency, increasing its board size from 29 to 35. Some of the additional members would come from enterprises that would stand to benefit from the largess of the retooled agency.  

Klein's initiative would legally require CIRM to establish conflict of interest regulations that are "generally aligned with standards adopted by the National Academy of Sciences." That is new language that could provide a rationale for not creating tougher standards and take some of the heat off the agency and its directors. 

Jeff Sheehy, a longtime patient advocate member of the board and chair of its science committee, released to the California Stem Cell Report a 3,300-word critique of the Klein initiative. Sheehy said last week in his analysis, 
"Questions related to conflicts of interest regarding the distribution of $5.5 billion in state funds obtained via debt financing should NOT be handed to an entity that is not under the control of the State of California. In addition, the National Academy of Sciences has no public meeting requirements nor other measures around public accountability and transparency that are uniformly applied to all government bodies in California.
"Those sections removing conflicts of interest oversight from the purview of Californians should be removed. The way to address any concerns expressed around conflicts of interests by board members is to add new language changing the composition of the ICOC(the agency's governing board)."
For a look at one experience in California dealing with state stem cell issues and the NAS, see this item on the California Stem Cell Report. 

On Friday Nov. 15, the CIRM board will meet to consider Klein's new initiative, which requires more than 600,000 signatures to be placed on the November 2020 ballot. Klein is the only person who can make changes in it. He has until Monday Nov. 18 at 5 p.m. to do so, if he wishes. 

Klein has not yet commented on the upcoming CIRM board hearing. The California Stem Cell Report will carry his written response verbatim when it is received. 
Sphere: Related Content