Conflict Flap Dogs California Stem Cell Directors

The directors of the world's largest source of funding for human embryonic stem cell research meet on Wednesday to give away $60 million and set up rules for sharing the stem cell wealth with businesses.

But what's not on the agenda may be what dominates the news out of the meeting. And that is the fallout from the flap over conflicts of interest among the directors of the California stem cell agency.

California's Fair Political Practices Commission has announced it will investigate the conduct of one director, John Reed of the Burnham Institute, who lobbied on behalf of a $638,000 grant to his institution. In a separate incident, four deans of medical schools, who are also directors of the agency, signed letters on behalf of grant applicants in violation of CIRM's ethics policy. All 10 researchers have been dumped from consideration.

The Sacramento Bee editorialized Tuesday:

"The entire episode reveals much about this insular agency. Despite years of warnings about secrecy and insider dealings, the institute's overseers continue to break their own rules and then refuse to provide information about the apparent violators. They claim they are subject to 'unprecedented levels of oversight' – as stated in a letter to The Bee published Saturday – even though lawmakers can't touch this agency without a supermajority of votes.

"The consequences do not bode well for cutting-edge research.

"Ten scientists have now lost out on grants that could lead to research breakthroughs. Others will surely lose out in future scandals if California continues to allow vested interests to determine the expenditure of $3 billion in public money."

Two members of CIRM's Oversight Committee have called for the resignation of Reed. Others are disturbed as well.

Francisco Prieto, a Sacramento physician, said in an email:

"I have not made up my mind yet as to whether he should resign (one strike and you're out?), but I would like to hear from him. My feeling is he should apologize for a very obvious mistake, accept whatever penalty is assessed and we could then move on."

John M. Simpson of the Foundation for Taxpayer and Consumer Rights has called for Reed's resignation and that of CIRM Chairman Robert Klein, who advised Reed to write his lobbying letter.

Simpson also says that at the very least Reed and "his representative to the board in his absence, Jeannie Fontana, should be barred from taking part in any stem cell board deliberations while the FPPC probe continues."

As for the 10 rejected researchers, interim CIRM President Richard Murphy told the California Stem Cell Report he hopes CIRM directors will approve a new round of grant funding to give the 10 scientists a fresh shot at the $25 million or so that they are missing out on Wednesday.

The Oversight Committee, as the board of directors is known, will also consider adding as much as $35 million to the upcoming $227 million round of grants for stem cell lab construction. It is the largest single round for CIRM so far.

Although all the applicants are major educational or research institutions, CIRM refuses to disclose their identities on the grounds that losers might be embarrassed.

Prieto said,

"I will continue to argue for releasing the names of the institutions applying. I think it's just silly to think this can be kept secret for long in any case, and no harm is done whatsoever by releasing this info - it affects virtually nobody's personal reputation or feelings."