Effort Advances to Beef Up Royalties and Oversight of CIRM

Legislation to tighten oversight of California's $6 billion stem cell research program moved forward Tuesday despite opposition from the state's stem cell agency.

The measure by Sen. Deborah Ortiz, D-Sacramento, cleared the Assembly Health Committee on a 9-2 vote. It now goes to the Assembly Appropriations Committee.

As we reported last week, Ortiz' wide-ranging proposal, SB401, would require more openness in meetings of the California stem cell agency, require divestiture of investments by Oversight Committee members in some cases and increase the state's share of royalties.

The action was not covered by any newspapers as far as we can tell. The legislative staff analysis said the only opposition to the bill, at the time the analysis was written, came from CIRM and the California Healthcare Institute, an industry group. The analysis said,

"The California Healthcare Institute (CHI) maintains that this bill limits the effectiveness of CIRM. In addition, CHI states that while this bill seeks to apply licensing and other conditions to its grants and loans that are in the best interest of the state, its provisions may discourage industry participation and points out that the state's share of financial return should be proportionate to its contribution, not a fixed percentage of total revenues similar to the percentages contained in this bill."

Ortiz' office released background information on the bill that said:

"As editorial boards across the state have noted, while the promise of stem cell research is great, Prop. 71 omits several important protections to ensure public accountability and transparency of funding decisions. For example, the initiative exempts its working groups, which make important recommendations on what projects to fund, from state open meeting and public records requirements. It similarly omits requirements for working group members to disclose interests they have in entities engaged in stem cell research. Finally, the initiative is unclear on the question of how the state is to achieve an economic return on its investment in stem cell research."

The measure was amended in committee to ensure that it would be placed on the November statewide ballot.