Friday, September 22, 2017

Ballot Measures to Mergers: California Stem Cell Agency Examines Alternatives to Its Demise

Discussing the future of CIRM on Monday: Left to right, Chair Jonathan 
Thomas,  Vice chair Art Torres, Director Diane Winokur. Photos behind
 them are  of  persons helped by the agency's clinical trials. 
Photo by The California Stem Cell Report.
OAKLAND, Ca. -- Directors of California's $3 billion stem cell research effort are looking at ways to stave off the agency's death ranging from asking voters for billions more to being acquired by some sort of private entity.

The choices came before a new Transition Subcommittee of the agency's governing board last Monday. It is considering options as the money runs out for the California Institute for Regenerative Medicine (CIRM), as the agency is formally known.

Current projections estimate that cash for new awards will end in mid 2020. However, directors could alter the award rate and survive longer. That would shrink the flow of cash to possibly hundreds of researchers from Sacramento to San Diego.

CIRM's funds come from money that the state borrows. The ballot initiative that created it in 2004 provided for $3 billion in state bond funding but no other significant revenue. The agency has roughly $650 million remaining.

No directors at the meeting expressed support for simply letting financial nature take its course and permitting the agency to slowly expire.

One option that seemed to attract significant interest would call for the agency to ask the legislature and the governor to place another multi-billion dollar ballot measure before voters in 2020. That option would involve the governor who succeeds Jerry Brown in 2019.  Brown is wary of adding any height to what he calls California's "wall of debt."

Such an option requires a two-thirds vote of both houses of the legislature and the signature of the governor. (A CIRM memo on legislative options incorrectly said that only a majority vote was needed. It was corrected during the meeting.)

One possibility would involve another ballot initiative, a process that would not need approval of the legislature. However, under new state law provisions, the legislature is required to hold hearings on ballot initiatives. Such a process could result in changes in a proposed initiative.

CIRM directors seemed to acknowledge that either going to the legislature directly or using a ballot initiative would likely mean significant changes involving the agency. Director Steve Juelsgaard said the result could be a "very different CIRM."

The options considered this week also included private fund-raising. Some directors indicated that raising $200 million to $300 million a year was not entirely realistic. However, some combination of fund-raising and public support was also a possibility.

The last-ditch option involved acquisition of the agency by another enterprise including possibly a venture capital driven entity.  CIRM Chairman Jonathan Thomas said a possibility could involve an organization such as the Gates Foundation or the Wellcome Trust. He said California has a "tremendous asset" in CIRM and a "ton of IP(intellectual property)."

Director Jeff Sheehy said he had "never heard of a state agency that was merged or acquired."
"I wouldn't put my head in that noose," Sheehy said.

Thomas said the next step will be to hold a joint meeting of the directors' Science and Transition Committees in November and take the resulting recommendations to the full board in December.

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