California's Far-Reaching Alpha Stem Cell Clinic Plan Likely to Take a Hit

The new president of the California stem cell agency today recommended cutting $5 million from the agency’s ambitious Alpha stem cell clinic plan, declaring that the proposal’s $70 million cost is “not clearly justified.”

If the agency’s board goes along with the recommendation at Thursday’s meeting, it will be the first time the $3 billion agency has so radically and retroactively reduced a proposal in its nearly 10-year history.

Randy Mills

In a memo posted early today on the agency’s Web site, Randy Mills, who joined the agency in May, said,  

“While all of the aims of the concept plan are individually laudable, it is my firm belief that the proposal as written is too broad and overly complex to be successful. In a word, it lacks focus. As a result of its overly wide-ranging scope, I also believe that there is a real possibility of incurring significant duplicative costs. Following a thorough review and conversations with senior members of the CIRM team, it is my opinion that the $70 million price tag is not clearly justified in terms of the benefits it will deliver to the people of California.”

The Alpha stem cell clinic program was heavily promoted by the former president of the stem cell agency, Alan Trounson. It is aimed at making the Golden State the world’s “go-to” location for stem cell therapies.

Mills said, however, that a $15 million component creating a data/information center should be stripped from the plan and whittled down to $10 million.

He said the center’s efforts to combine aspects of clinical operations, data sharing, education/marketing and lobbying for insurance coverage of stem cell therapies would create an “unwieldy program.” Instead, he said the Alpha effort should focus on early stage clinical operations  – “efforts directly related to high quality stem cell clinical trials.”

Mills’ proposal comes late in the game for the Alpha awards. Applicants have already submitted their proposals. The review of the applications was originally scheduled to occur last month. However, in one of his first public acts, Mills postponed the review, which is now scheduled for September.  The reason for the delay, the agency said in June, was the difficulty in finding reviewers.

However, the information center component is contained in a separate RFA and could be easily discarded. The only damage would be the time that the five applicants spent on preparing their applications, which is no small task, and the work that the CIRM staff has done so far.

Mills told the board in the memo,

“I realize that making this recommendation after the submission of applications for the CIMC (the data center) is not optimal. However, given the magnitude of the spending proposed, not sharing this critical assessment with the board would be a greater disservice. I believe that these recommendations are not only fiscally responsible, but more importantly, give the program the greatest chance of success to accomplish our mission of getting stem cell treatments to patients in need.”

Mills is also recommending alterations in the clinical portion of the Alpha plan, which involves eight separate applications, all of which are likely to have come from institutions with representation on the stem cell board.  Mills said he wanted  “a staged approach to funding, where we evaluate with proper metrics, the effectiveness of the program in a limited number of sites before expanding.”

Mills’ Alpha memo does not appear to envision modifying the RFA, so presumably the staged funding would be dealt with in negotiations following board action on the applications, which will probably occur later this year.  Up to five awards are scheduled to be made.

Mills’ Alpha cuts are virtually certain to be approved by the board. Rejection of his recommendations would amount to a vote of no-confidence in Mills and would likely result in his resignation. (On Thursday, however, he assured the board he would not quit if it did not go along.)

Even earlier this year, Mills, who has made his career in business, demonstrated his parsimony. Trounson’s proposed operations 2014-15 budget for the agency was submitted in early May at $17.9 million, an increase of 9.5 percent increase over estimated 2013-14 spending. Mills sliced the spending plan to $17.3 million, maintaining it at virtually same level as last year – lower if inflation is factored in.

(An earlier version of this item incorrectly stated that Mills wanted to cut the program by $15 million.)