California Stem Cell Agency: IP and Sustainability Off the Table Tomorrow

The California stem cell agency says that tomorrow's meeting regarding the sweeping changes recommended by the Institute of Medicine (IOM) will not include discussion of intellectual property issues or proposals for the “sustainability” of the $3 billion enterprise.

In a memo to the governing board of the agency posted on its web site today, James Harrison, outside counsel to the board, said,

“The chairman (Jonathan Thomas) has conveyed his view that CIRM should maintain its existing policies regarding revenue sharing, pricing, and access. In addition, chairman Thomas is working on proposals to address the IOM committee’s recommendations regarding a sustainability platform, but it would be premature to discuss these proposals at this time. Therefore, we do not intend to devote significant time to either the intellectual property or sustainability platform recommendations. Instead, we hope to focus the discussion on governance issues and the application review process.”

The CIRM board begins a critical, two-day session tomorrow in Berkeley to consider the IOM's recommendations, which met initial resistance last month from a number of the agency's 29 board members. The recommendations would make major changes in the board and would mean some members would lose their seats, if the proposals were adopted without change.

The IOM also said that the board needs to overhaul its conflict of interest standards, declaring that “far too many” board members are tied to organizations that benefit from CIRM's largess. The agency has long been a target of criticism that it has conflicts of interests that were built in by Prop. 71, the ballot measure that created the program. Roughly 90 percent of the $1.7 billion that the board has awarded has gone to institutions that are linked to members of the agency's governing board, according to compilations by the California Stem Cell Report.

Arthur Caplan, a prominent medical ethicist at New York University, says that the IOM has concluded that CIRM's grant award process is “insular and somewhat incestuous.”

Harrison's document was long on the positive aspects of the blue-ribbon IOM study, which CIRM is paying for at a cost of $700,000. It was commissioned by the board in 2010 with the intent that it would be a springboard to another multi-billion dollar state bond measure, which requires voter approval. CIRM operates on money that the state borrows (bonds). The interest on the bonds will bring the total cost to taxpayers to roughly $6 billion. The financial arrangement is unusual for research funding and differs from federal funding, which is not based on borrowed cash. The CIRM bond money, however, will run out in less than four years. 

Harrison cited 10 points in which the IOM had praise for CIRM, points that few would differ with in any major way, even prior to the IOM study. Some might quibble, however, with a few of Harrison's effusive adjectives.

Significantly, Harrison did not present a fresh legal analysis that might have raised the possibility of constitutional objections to the IOM proposals. A memo from Harrison in 2009 was used by then CIRM Chairman Robert Klein to box in the board in connection with other, similar suggestions for changes at the agency. 

Harrison also disclosed that board's intellectual property (IP)subcommittee will examine the IOM's proposals on IP later and make recommendations. The IOM suggested, among other things, that CIRM modify its policies to bring them in line with federal law, which is not without its own controversies.

Tomorrow's session will be covered live by the California Stem Cell Report via CIRM's audiocast, which is available to the public, and we will file stories as warranted. The meeting begins at 10:30 a.m. PST. Directions for dialing into the audiocast can be found on the agenda for the meeting.