The Future of the California Stem Cell Agency: Cures, Priorities and Brain Drain

The California stem cell agency is nearing the end of its “normal” life span, and the topic of its future comes up with some regularity nowadays within the Golden State's stem cell community.

It is a tiny community that has benefited to the tune of $1.9 billion so far from the passage of Prop. 71, the ballot measure that created the agency nine years ago this month.

The latest public discussion of what UC Davis stem cell researcher Paul Knoepfler has dubbed “CIRM 2.0” came on Knoepfler's blog last week and a short time later on the agency's own blog. CIRM is the acronym for the California Institute for Regenerative Medicine, the formal name of the agency.

Predictably the most recent discussion, as generally occurs, emphasized the importance of the science and promise that it poses. Rarely heard, however, is whether the agency's efforts have been worth $6 billion (CIRM's projected cost including interest) and whether spending billions more over another decade ranks among the top ten priorities, for example, facing the state during the same period. That is the fundamental question facing CIRM if it is to seek additional public funding for its operations beyond 2017, when the cash for new grants will run out.

On his blog, Knoepfler cites four main reasons for the state to continue to support the agency at a high level. He says that it has “strongly boosted” the state's economy, made the state a global leader in stem cell research, created strong scientific momentum and, finally, that California faces a “potential harmful stem cell brain drain” should CIRM close its doors.

In a comment posted on Knoepfler's item, Jeanne Loring, head of the stem cell program at Scripps, said the future of CIRM inevitably arises in any conversation between any two stem cell researchers in California.

 She said a “continued investment in CIRM will pay off enormously” for the state. She said,

“CIRM has had the same effect on stem cell research that Genentech had on biotechnology; it showed that taking a chance on a focused investment in new technology could transform the future of medicine. Now, with CIRM’s focus on supporting partnerships of stem cell researchers with successful biotechnology companies, we have the best of both California-centric worlds: the power of technology applied to the abilities of stem cells. Such partnerships, especially in rapidly growing fields like genomics, will sustain progress beyond CIRM’s current reach.”

There is little doubt that CIRM has had a positive impact on California. But the claims that it has “strongly boosted” the California economy are dubious. Such assertions are based on a report commissioned by the agency itself at a cost of $300,000. According to the RFP for the project, the recipient of the contract for the study was to execute "a vibrant and aggressive strategy to support the goals and initiatives of CIRM.” (See here and here.)

 Additionally, the California economy runs in the neighborhood of $2 trillion a year with approximately 19 million persons in the work force. Biotech, which accounts for a relatively picayune 200,000 employees or so in California, is a miniscule economic player. (See here and here.) Stem cell companies and research are even smaller. As for the $1.9 billion CIRM has awarded, it has gone to only 625 recipients, a handful of which are businesses or institutions.

If the agency is to be evaluated as an industry-development engine, the criteria are also considerably different than would be used to evaluate a research-funding organization. Such an industrial evaluation was resisted strongly by Robert Klein, the first chairman of the agency, when the California Stem Cell Report suggested it to him some years ago. Ironically, Klein likes to trot out CIRM's own, dubious economic study when it suits his purpose.

Production of stem cell “cures” or therapies is also unlikely to employ the hundreds of thousands of Californians needed to make a major economic impact. Actual production of any “cures” is likely to occur overseas for the usual business reasons and thus not provide massive amounts of jobs within the state. That said, the owners of successful stem cell companies could become extremely wealthy a la their cousins in the Silicon Valley.

California Gov. Jerry Brown, who is widely expected to seek re-election next year, has already identified two, long-term mega-projects that he believes are fundamental to the economic well-being of California – high speed rail and a massive water project. The cost of those two efforts is likely to run in the neighborhood of close to $100 billion, according to the most recent estimates. That is not to mention the financially starved University of California, state colleges and community colleges or even the youngsters who need to learn to read and write in the state's public schools. Adequate support of those institutions, which are critical to the state's economy, would require many more billions. Brown notably has not spoken publicly about his views on the value of the stem cell agency. His support would be needed for CIRM to acquire additional public dollars.

For the people of California, the question would be: How does stem cell research fit in with their perception of the needs of California, ranging from education to water to other priorities? At this point, the stem cell agency and its work are virtually unknown to the general public. The agency is working hard to improve its visibility and create an atmosphere conducive to generating more cash. But it is very much up in the air whether CIRM can successfully set the stage for infusion of more billions of public dollars.