Excerpts from the IOM Report on the California Stem Cell agency

Here are excerpts from the $700,000 Institute of Medicine (IOM) report on the $3 billion California stem cell agency -- the California Institute of Regenerative Medicine (CIRM).

Overall Comments

“Improvements to CIRM’s governance structure, scientific program, and policies are critical to bet­ter serving California taxpayers who elected to devote funding to promote stem cell research in the state. The necessary changes outlined by the IOM committee, if enacted by the state and/or the institute, would help to instill confidence among the scientific community and California residents in the vital work that CIRM is accomplishing.”

“It is the committee’s judgment that overall, CIRM has done a very good job of initially establishing and then updating the strategic plans that have set priorities for and guided its programs, and of taking advantage of its guaranteed flow of $300 million a year for 10 years to establish a sustainable position in regenerative medicine for California. The challenge of moving its research programs closer to the clinic and California’s large biotechnology sector is certainly on CIRM’s agenda, but substantial achievements in this arena remain to be made.

“Despite its demonstrable achievements to date, as well as the largely positive independent reports covering various aspects of its operations, no one would claim that CIRM is a perfect organization or that it should adhere slavishly to its initial form of organization, set of regulations, or pattern of priorities. The field of regenerative medicine has advanced rapidly since November 2004, and CIRM itself has seen the need to alter its activities and approaches in some areas. The committee believes the same should be true of its governance structure, some of its administrative practices, and its use of external perspectives on strategic scientific priorities and on the evaluation of other key policies, such as intellectual property, to ensure that they continue to encourage the development and deployment of new treatments.”

“While the restrictions on amending the administrative structure of CIRM established in Proposition 71 had the advantage of protecting the institute’s ongoing operations from outside interference in an ethically controversial arena, they also made it difficult to modify the organization’s structure in response to experience and/or changing circumstances. Moreover, these protections, whatever their benefits, appear to some to shield CIRM from the normal accountability mechanisms in place for state agencies.”

Conflicts of Interest

“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, introduce potential bias into the board’s decision making, and threaten to undermine confidence in the board. Neither the board chair nor board members should serve on any working group. The board itself should include representatives of the diverse constituencies that have an interest in stem cell research, but no institution or organiza­tion should be guaranteed a seat.”

“The problematic perception of conflicts of interest has persisted for as long as CIRM has existed. The IOM committee would be less concerned about individual board members with actual or perceived conflicts of interest if the board membership included more truly independent members. The majority of board members should be independent, with no competing or conflicting personal or professional interest. Broader representation from a wider variety of stakeholders will inject new perspectives into the panel and will help to dispel the perception of conflicts of interest.

“CIRM also should revise its conflict of interest definitions to include non-financial interests, such as the potential for personal conflicts of interest to arise from one’s own affliction with a disease or personal advocacy on behalf of that disease. CIRM policies for managing conflicts of interest should apply to that broader definition.”

Structure and Governance

“Currently, the ICOC (the agency's governing board) functions both as an executor and as an overseer—competing duties that compromise the ICOC’s critical role of pro­viding independent oversight and strategic direc­tion. The IOM committee recommends that CIRM’s operations be separated from its over­sight. The board should delegate more author­ity and responsibility for day-to-day affairs to the president and senior management, and the ICOC’s three working groups should report to senior management within CIRM, rather than to the ICOC. The moves would permit the board to better focus its energy and collective talent on strategic planning, overseeing financial perfor­mance, ensuring legal compliance, assessing the president’s performance, and devising a plan for preserving and expanding its considerable assets to permit the institute to continue its important work after the bond measures end.”

Unrealistic Goals

“While the latest round of awards challenge teams to have filed a request to begin clinical trials or to have completed early-stage trials in patients within four years, the committee feels these ambi­tious goals are unrealistic. New therapies take more time to progress to federal approval, and early-stage clinical trials are beset by a stagger­ingly high failure rate. Rather than judging suc­cess by simply tallying the number of active clini­cal trials, the IOM committee suggests that CIRM also continue its focus on underlying biological mechanisms that drive the success or failure of a promising therapy and on careful design of clini­cal trials. Advances in these areas will help the entire field progress, even if a specific drug candi­date is not approved." 

Economic Impact

“In the short term, CIRM’s expenditures are supporting approximately 3,400 jobs and their innovative efforts have also attracted substantial additional private and institutional resources to this research arena in California CIRM’s long-term impact on such critical aspects of the California economy as state tax revenues and health care costs beyond the shorter-term and temporary impact of its direct expenditures cannot be reliably estimated at this point in CIRM’s history.... (T)he estimate of the Analysis Group (2008) that the CIRM program alone would support about 3,400 jobs as long as it was allocating about $300 million per year in research and development grants appears quite reasonable to the committee. To put this estimate in context, however, total employment in California is roughly 16 million, and NIH alone provides more than $3.5 billion per year to California research institutions.”

Intellectual Property

“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. CIRM should seek to clarify which state agencies and actors will be responsible for the exercise of discretion currently allocated to CIRM and the ICOC (the CIRM governing board) over future determinations on issues regarding march-in rights, access plans, and revenue-sharing rights that might arise years after CIRM's initial funding period has passed.... (T)he 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(federal IP law).