Tuesday, January 29, 2013

Stem Cell Agency Plan Falls Far Short of Solving IOM Concerns

The governing board of the $3 billion California stem cell agency last week fell far short of complying with the recommendations of a blue-ribbon Institute of Medicine (IOM) study that the agency itself commissioned to improve its performance.

Many of the proposals by the IOM dealt with conflicts of interest at the eight-year-old agency, which board members reluctantly recognized on Wednesday as a perception problem. Under the plan approved last week, 13 of the 29 members of the board would not be allowed to vote on any awards. They are members tied to institutions that benefit from funding. Three other board members linked to those beneficiary institutions, however, would still be allowed to vote on grants other than those to their institutions. .

The board did nothing to deal with the structural issues involving conflicts of interest that are built into the board as the result of Prop. 71, the ballot measure that created the research effort in 2004. The 29-member board was constituted in such a way as to give nearly all institutions that could benefit a seat at the table where the money is handed out. It is as if the state's Public Utility Commission, which sets utility rates, were dominated by executives of the utility companies.

Under longstanding rules, individual members of the stem cell board are barred from voting on grants to their institutions. However, the board still determines the game and the rules. The board approves the specific areas of research for funding, approves plans for individual RFAS, sets the rules for the grants and loans and enforces compliance through CIRM staff.

The board last week limited itself to changes that it could enact on its own. Many of the IOM recommendations, including a new majority of independent members, would require legislative action, which opens the agency to a wider range of changes than even the IOM recommended. That is not a prospect the agency relishes. Nonetheless, how well the board complies with the IOM recommendations is likely to be critical to its plans to raise funds to continue its operations beyond 2017, when the taxpayer cash runs out for new grants.

Here is a look at the key IOM recommendations and the response so far from the stem cell agency(see here and here). More details may emerge between now the next CIRM board meeting in the San Francisco Bay Area March 19, when the board is schedule to finalize its IOM plan. 

IOM Recommendation
“Change the Composition and Structure of the Board and Working Groups.
“CIRM should put systems in place to restructure the board to have a majority of independent members, without increasing the size of the board. It should include representatives of the diverse constituencies with interests in stem cell research, but no institution or organization should be guaranteed a seat on the board. Consideration should be given to adding members from the business community....The chair and other ICOC members should be prohibited from serving on the working groups. During the reconstitution of the working groups, the current level of representation of disease advocates should be maintained, such board members being replaced with other disease advocates who are not board members.”
CIRM Response
The Thomas plan basically is a total rejection of this recommendation. The CIRM board does not support creation of a new majority of independent members, which would mean some current members would lose their seats if the board were not increased beyond 29 members. No members will be added from industry. Board members will continue to serve on the grant review panel and other groups, contrary to IOM recommendations. In the case of grant reviews, however, they would no longer vote in the closed door sessions. The board has no plans to add patient advocates who are not board members to working groups, including the grant review panel. The University of California will continue to have five guaranteed seats on the board. No independent members currently sit on the board.

IOM Recommendation
“Revise Conflict of Interest Definitions and Policies.
“CIRM should revise its definitions of conflict of interest to recognize conflicts arising from nonfinancial interests, such as the potential for conflict arising from an individual’s interest in a specific disease, and should reassess its policies for managing conflict of interest in light of this broader definition.”
CIRM Response
CIRM has no plans to move to prevent nonfinancial conflicts of interest. Several board members expressed strong opposition to such an effort. Sixteen persons who sit on the board have ties to institutions that receive CIRM funds. Currently individual board members cannot vote on applications from their institutions. To avoid the appearance of conflicts of interest, the Thomas plan would have the 13 members directly appointed from beneficiary institutions voluntarily abstain from voting on any grant applications. Apparently not affected under the Thomas plan would be three other board members who are appointed as patient advocates. Two of them are employed by beneficiary institutions. The third is chairwoman of the UC Board of Regents. All of the board members would continue to vote on plans for all rounds of grants, including determination of some of the specifics of the ensuing RFAs.

IOM Recommendation
“Restructure the Grant Review and Funding Process.
“CIRM should restructure the grant review and funding process to separate oversight and strategic planning from day-to-day operations. The ICOC (the agency's governing board) should remain responsible for oversight and articulation of an overall strategic plan. However, grant management, funding recommendations, and grant administration should be the responsibility of the CIRM scientific staff, reporting to the president. This restructuring would help mitigate concerns related to conflicts of interest and would also put the review and funding process in the hands of those best equipped to make those decisions.”
CIRM Response
CIRM patient advocate board members who serve on the grant review group would not vote on applications during the grant review sessions. They would be limited to voting at public board meetings. They would lead discussion of non-scientific considerations for approval of applications during the public sessions. Currently that occurs during the closed door review.

IOM Recommendation
Abolish the “extraordinary petition” mechanism for public appeals of negative grant reviews.
CIRM Response
Move all appeals to staff level and behind closed doors. Currently extraordinary petitions are handled in public board meetings, sometimes leading to lengthy, emotional sessions with presentations by patient advocates. The public in general, including grant applicants, continues to have the right under state law to address the board on grant applications or any other matter they wish.


IOM Recommendation
“Separate Operations from Oversight.
“The board should focus on strategic planning, oversee financial performance and legal compliance, assess the performance of the president and the board, and develop a plan for transitioning CIRM to sustainability. The board should oversee senior management but should not be involved in day-to-day
management. The chair and the board should delegate day-to-day management responsibilities to the president. Each of the three working groups should report to management rather than to the ICOC.”
CIRM Response
The Thomas plan does not appear to differ significantly from current operations, which reflect the troubling dual executive arrangement involving the chairman and president that was created by Prop. 71, the ballot measure that created CIRM. The existing arrangement is also a hangover from the days of the agency's first chairman, Robert Klein, and has been an obstacle in previous recruitment efforts for a president of the agency. The Thomas plan does eliminate a dual reporting arrangement for the chief financial officer, a position that has been vacant since last summer. Thomas indicated last fall that the position would not be filled. Both the chairman of the IOM study panel and the California state controller's office both say more needs to be done to separate operations from oversight.

IOM Recommendation
“Enhance Industry Representation in Key Aspects of CIRM Organization.
“Industry representation on the ICOC, the Scientific Advisory Board, the Standards Working Group, and the Grants Working Group should be enhanced to leverage industry’s expertise and resources in product development, manufacturing, and regulatory approval in support of the ultimate goal of bringing therapies to patients.”
CIRM Response
The Thomas plan would increase industry involvement “where appropriate.” However, industry has complained for years about this problem, and some board members as well. But little has been done to deal with the problem. Recently, the agency has taken some steps to engage industry, but the IOM was aware of those when it made its recommendation for closer cooperation.

IOM Recommendation
“Establish a Scientific Advisory Board.
“CIRM should establish a single Scientific Advisory Board comprising individuals with expertise in the scientific, clinical, ethical, industry, and regulatory aspects of stem cell biology and cell-based therapies.” Members of this board would be from out of state and replace existing advisory boards. They would be appointed by and report to president.
CIRM Response
CIRM says the structure and membership of the a new board is under discussion, but generally indicated it would go along this proposal. Not specifically addressed was abolition of other advisory groups.
Develop a “sustainability” platform in consultation with current and future partners, including sources of funding.

IOM Recommendation
Develop a “sustainability” platform in consultation with current and future partners, including sources of funding.

CIRM Response
Chairman Jonathan Thomas said he is working on details of a plan.

IOM Recommendations
“Incorporate Future Enforcement of Intellectual Property Policies in the Sustainability Platform.
“As part of the plan maximizing the continued impact of CIRM’s many achievements..., CIRM should propose regulations that specify who will have the power and authority to assert and enforce in the future rights retained by the state in CIRM-funded intellectual property.”
“Consider Harmonizing Intellectual Property Policies with Policies of Bayh-Dole Act.
“As other sources of funding for stem cell research become available and as the field of regenerative medicine advances from the laboratory to the clinic, the ICOC should reconsider whether its goal of developing cures would be better served by harmonizing CIRM’s IP policies wherever possible with the more familiar policies of the Bayh-Dole Act.”
CIRM Response
The governing board's IP Subcommittee will review the policies and make recommendations.


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