Also on the agenda are revised IP rules dealing with affordable access to taxpayer-financed stem cell therapies, although there appears to be no controversy about the rules at this point.
CIRM had hoped to have the bank underwriters in place by now for its $210 million disease team program, the largest research round ever for CIRM. Applications for that program are being reviewed behind closed doors today through Friday in San Francisco by the CIRM Grants Working Group.
Three banks were under consideration to run the biotech loan effort. They were Comerica, Square One and Silicon Valley Bank. The first two provided the lowest cost estimates, with Comerica coming in at $71,000 for handling a $20 million, six-year loan. More than one bank is expected to be hired because of the potential for conflicts of interest.
At the August CIRM board meeting, John Robson, vice president for CIRM operations, said that once the agency had some sort of initial agreement in place with Comerica and Square One, negotiations would follow with Silicon Valley Bank.
CIRM Chairman Robert Klein, who originated the concept for the biotech lending program, stressed the importance of moving forward with Silicon Valley Bank. He said,
“Given the tight time frame, moving forward with Silicon Valley Bank is going to be important, if feasible, so that the board really has the full choice and the cost differences in front of them when they are asked to approve the delegated underwriters. With a prototype process, we will and have run into some issues with these banking institutions as they've -- their legal departments have understood the complexity of dealing with the state. So we need to bring forward, to the extent we can, all three opportunities for the board so the board can make a decision.”CIRM is seeking to hire a bank to run the program because the agency does not have the expertise or the staff to do the work. The banks would perform an analysis of business applicants, assess their operations and management and make recommendations.
CIRM plans to lend money to risky enterprises that otherwise could not secure financing. Loan failure rates of up to 50 percent in the program have been predicted by CIRM.
The first loans are scheduled to go out following formal approval later this year of winners in the disease team program.
The IP rules that are also under consideration next week stirred a flap at one point. The board, however, last month rescinded the controversial proposed changes.
John M. Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., and who raised the earlier concerns, says he is satisfied with the current proposed changes.
The public can listen to and participate in the board meeting at a number of locations throughout the state. Their specific addresses can be found on the agenda.
A transcript of last month's brief discussion of the biotech loan program can be found here. Sphere: Related Content