California Stem Cell Health Dividends: A Whopping $900 Billion? Maybe Only $175 Billion?

A team of University of Southern California researchers said today that work by California's stem cell agency could pay off with nearly $900 billion in "health dividends" by 2050 by treating or curing afflictions ranging from diabetes to heart disease.

The study, commissioned by the agency, acknowledged the difficulty in forecasting the benefits of research backed by the the state program, which is unprecedented in California history. But the report said,

"We find that nearly half of Californians aged 50 and older will develop diabetes during their lifetime. Furthermore, more than one-third will experience a stroke, and between 5 and 8 percent will develop either breast, colorectal, lung, or prostate cancer.  

"Taking into account the high prevalence and the social and economic burden of these diseases, an intervention that reduces the incidence of these selected cancers, diabetes, and stroke by 50 percent would generate almost $900 billion in social value between 2018 and 2050.  

"A more modest 10 percent decline in incidence translates to $175 billion in social value during the same period. Put in this context, the CIRM investment would be worthwhile if it increased our chances of success even modestly. Against the billions of dollars in disease burden facing California, the relatively small initial investment is already paying dividends as researchers work to bring new therapies to patients."

The agency, known formally as the California Institute for Regenerative Medicine (CIRM), was created by voters in 2004, who provided it with $3 billion. It has yet to fund a product that is widely available to the public. However, the agency is involved in 56 clinical trials, which are the last stage before a treatment is certified for widespread use.

CIRM expects to run out of cash for new awards by the end of this month. It hopes that a proposed initiative for the November 2020 ballot will provide it with an additional $5.5 billion. 

Today's report, titled "Future Health Dividends for California," and its companion study last week on the agency's economic impact are likely to be significant topics during the 2020 campaign. 

The 22-page study came up with a "social value" calculation using the Future Elderly Model -- "a microsimulation model of health and economic outcomes for older Americans." Basically it involves quality of life outcomes as well as more straight forward financial projections. The study also lays out its methodology and limitations including an acknowledgement that the projections are not guaranteed. 

Today's report and last week's economic study cost CIRM a total of $206,000. The work was performed at USC's Leonard D. Schaeffer Center for Health Policy & Economics. The authors are Bryan Tysinger, Karen Mulligan, Henu Zhao, Alwyn Cassil  and Dana Goldman.

Here is a link to an item on the CIRM blog about the study.

Making Changes in a $5.5 Billion Stem Cell Matter: What California Law Permits

Screenshot from state Department of Justice "active measures" website

A  California ballot proposal to spend an additional $5.5 billion over another 10 years on stem cell research is not locked in concrete or in even locked in its dense, legal language.

It can actually be modified between now and Nov. 17 if its sponsors so desire. That may be a big if, but it is possible as a result of 2014 changes in state elections law.

Here is the way it works. Any member of public can comment or suggest changes in proposed ballot initiative between now and Nov. 12 on this state web site.  The Department of Justice will pass along the suggestions to the sponsor of the initiative. The sponsor can make changes in the initiative up to Nov. 17.

Whether changes actually occur depends on pressures brought to bear by various constituencies that have something at stake in this multibillion-dollar game. Those interests include most of the Golden State's major universities and research institutes, the biotech industry, the fledgling California stem cell industry, patient advocate groups ranging from diabetes to cancer and even national regenerative medicine groups, not to mention religious or other groups that may have ethical concerns.

Of course, suggestions do not have to be filed with the attorney general. They can go directly to Robert Klein, who filed the initiative. Klein is a Palo Alto real estate investment banker, who founded the stem cell advocacy group, Americans for Cures. He led the 2004 campaign to create the agency and served as its first chairman. Klein directed the writing of the 2004 initiative as well as the current proposal.

His group also has a scientific advisory board that includes a host of California stem cell luminaries ranging from Irv Weissman of Stanford and Larry Goldstein of UC San Diego to Leslie Thompson of UC Irvine and Arnold Kriegstein of UC San Francisco. Klein has said he consulted with them in drafting the latest ballot proposal. They may well be interested in hearing comments on what is now being offered.

The California Stem Cell Report has already heard murmurings about changes that backers of the agency would like along with similar thoughts from opponents. But the measure is quite fresh and 30 pages long. So it may take a little time for solid suggestions for changes to emerge. 

The governing board of the stem cell agency, known formally as the California Institute for Regenerative Medicine (CIRM), has scheduled a meeting for Oct. 31, its first since the initiative was filed. It is expected to act on a number of awards, which are expected to be its last new awards until it receives additional funds. 

Asked last Friday whether board might make suggestions for changes in the initiative, Kevin McCormack, senior director for communications, replied via email, 

"Right now the CIRM board hasn’t taken a position on it. At some point in the future the board will discuss the initiative at a public meeting and take a position."

Here is the contact link for Klein's Americans for Cures and the email address for the stem cell agency: info@cirm.ca.gov 

Re the suggestion period and amendments to the initiative, here is the salient language from the California Secretary of State, the state's top elections official.

"Once a request for a circulating title and summary has been submitted, the Attorney General’s Office will post the text of the proposed initiative measure on their website and facilitate a 30- day public review process during which any member of the public may submit written public comments to the Attorney General’s Office via their website. The Attorney General’s Office will provide any written public comments received during the public review period to the proponent(s). (Elections Code § 9002(a).) During the public review period, amendments signed by all of the proponent(s) may be submitted to the Attorney General’s Office. Any amendments to the proposed initiative measure must be reasonably germane to the theme, purpose, or subject of the initiative measure as originally proposed. An amendment shall not be accepted more than five days after the public review period is concluded. (Elections Code § 9002(b).)"

'Handsome Dividend' -- California Stem Cell Agency and Its Economic Impact on the Golden State

This video was produced by Forty Seven, Inc., a firm in which California's stem cell agency has invested more than $15 million. 

California’s stem cell research program has had a “major impact” on the state’s economy, generating billions in sales revenue and creating tens of thousands of new jobs, according to a study released today.

Commissioned by the $3 billion state stem cell agency, the report comes as the program is hitting a difficult financial patch. Known officially as the California Institute for Regenerative Medicine (CIRM), the agency expects to run out of money for new awards by end of this month. CIRM is hoping that voters will refinance it with $5.5 billion via a ballot initiative in November 2020.

The 84-page study is expected to serve as a rebuttal to critics who have called the nearly 15-year-old agency a boondoggle. The report said, 

“The state’s investment in (the agency) has paid handsome dividends in terms of output, employment and tax revenues for California."

Adam Rose, USC photo

Dan Wei, USC photo

The study and a yet-to-be released companion report were commissioned at a cost of $206,000 by the agency. The economic study was prepared by Dan Wei and Adam Rose of the Price School of Public Policy at the University of Southern California. 

Maria Millan, CEO and president of CIRM, said in a news release that the study reflects the agency's role in building a stem cell "ecosystem" in the Golden State. 

Beyond CIRM's medical and scientific work, she said that the agency is "promoting economic growth in California  by attracting scientific talent and additional capital, and by creating an environment that supports the development of businesses and commercial enterprises in the state."

The report summarized CIRM's economic impact in four points. 

• "$10.7 billion of additional gross output (sales revenue)
• "$641.3 million of additional state/local tax revenues
• "$726.6 million of additional federal tax revenues
• "56,549 additional full-time equivalent jobs, half of which offer salaries considerably higher than the state average."

CIRM's news release on the report characterized the study as "independent." CIRM said it showed that the agency's efforts had a "major impact" on the state's overall economy, which totalled $3 trillion in 2017. 

The agency cited the assistance it has provided to create companies that ultimately will make CIRM-financed therapies available to the public at large.

While the agency's spending has not yet led to a widely available therapy, it is backing 56 clinical trials, which is the last stage before a treatment can be approved for widespread use. About 86 percent of clinical trials fail to result in a product, according to 2018 figures.

As an example of a fruitful collaboration, the agency cited Orchard Therapeutics of the United Kingdom, which plans to seek to qualify soon for speedier federal approval of its treatment for a version of  "bubble boy syndrome," a fatal immune deficiency. CIRM has awarded the firm $8.5 million.

The treatment was developed by Donald Kohn at UCLA with the help of $52 million in CIRM cash.  During clinical trials, it has saved the lives of more than 50 babies. Kohn said in a statement,

"I think one of the greatest strengths of CIRM has been their focus on development of new stem cell therapies that can become real medicines."

Orchard has offices in the San Francisco Bay area and plans to build a 150,000-square-foot manufacturing facility in Fremont. 

Also cited as an example was a company called Forty Seven, Inc., of Menlo Park, Ca., which is developing cancer therapies. Mark Chao, founder of the firm, said CIRM's support was "instrumental to our early successes."

The economic study also explored the "deal flow" funding that has aided commercialization of research. The study said it is expected that 

"...CIRM's past and current funding will attract increasing amounts of industry investment and lead to additional spending injections into the California economic in the years to come."

The companion report to today's economic study involves "health dividends" provided by the agency. That report is expected to be released next week. 

The agency has commissioned other economic studies in the past including one in 2012 that also lauded the agency. The request for proposals to perform that 2012 study said it must execute "a vibrant and aggressive strategy to support the goals and initiatives of CIRM.” 

Queried by the California Stem Cell Report, Kevin McCormack, a spokesman for CIRM, said four enterprises were solicited to develop this year's study. Three declined. The contract for the latest study stipulated that USC had control of the content. The latest study also laid out the methodology in considerable detail, something missing from the 2012 report. 

Below is a May 31, 2019, 58-second video of the president of Orchard, Mark Rothera, discussing the company's work. More brief, 2019 videos of Rothera from same interview sequence can be found here, here, here and here. The videos were taken by the Alliance for Regenerative Medicine. 

$5.5 Billion Stem Cell Ballot Measure: California Backers Taking First Formal Step This Month

CIRM graphic

Backers of a California ballot initiative to provide $5.5 billion more for the state's cash-strapped stem cell agency say they will take their first official step by the end of this month. 

That's when they will submit the proposed measure to California election officials and trigger a many-months-long process. The effort is aimed at ensuring that the nearly 15-year-old research effort survives in a meaningful way beyond next year.

The stem cell agency, officially known as the California Institute for Regenerative Medicine (CIRM), expects to  run out of money for new awards as early as late October.  It has already cut off grant applications except for a joint sickle cell effort involving the National Institutes of Health. 

Robert Klein, a Palo Alto real estate investment banker, and his stem cell advocacy group, Americans for Cures, are leading the way on the initiative. Melissa King, executive director of the organization, told the California Stem Cell Report last week that the wording of the initiative is still being crafted.

King said, however, that she expected the measure to be submitted to the California secretary of state before October. She said that one area still being drafted involves providing assistance for low income patients and their families in rural areas who do not have the wherewithal to travel to and participate in clinical trials.  

The initiative filing will trigger a lengthy process to gather the  633,212 signatures of registered voters necessary to qualify the  proposal for November 2020 ballot. Gathering those signatures is a task performed by specialized firms. It could cost something in the neighborhood of $5 million or more, which Klein will have to raise on his own.

Many more signatures than the minimum are gathered because significant numbers of the signatures are commonly determined not be valid.

The ultimate deadline for qualification is June 25 of next year, 131 days before the Nov. 3 election. But the signatures will have to be submitted well before then.

The stem cell agency was created in 2004, also by a ballot initiative, with $3 billion in state bond funding. The new initiative will likewise use bond funding, which roughly doubles the cost to taxpayers because of interest expense on the borrowed cash.

The 2004 ballot campaign was supported by Hollywood stars and Nobel Prize-winning scientists. It generated grand expectations that stem cell therapies were right around the corner. While CIRM is currently involved in 56 clinical trials, it has yet to back a therapy that is widely available. Clinical trials are the last step before a medical treatment is approved for widespread use and have a high failure rate. 

Klein led the campaign in 2004 and became the first board chairman of the agency. Klein has been gathering information, statistics and support for the effort at his Palo Alto offices. 

In June, he told the California Stem Cell Report:

"This medical revolution holds the promise of restoring health and quality of life for many of California’s individuals and families suffering from chronic disease and injury.

"However, the last tactical mile to bring this broad spectrum of therapies to patients will require more funding and the thoughtful support of California’s public as the human trials and discoveries are refined and tested, overcome numerous obstacles or complications, and ultimately serve to improve the life and reduce the suffering of every one of us."

The "Hard Case" of Stem Cell Sound Bites and a Campaign to Raise Billions

The journal Nature today reported on the $5.5 billion plan to save what it called the "struggling" California stem cell agency, which is fast running out of cash for new research awards. 

In an article by Jonathan Lambert, Nature caught up with news that it is not so new to readers of this web site. 

The piece carried information from Robert Klein, who expects to lead a new ballot initiative effort late next year to provide the billions more for the California Institute for Regenerative Medicine (CIRM), as the agency is formally known. 

Nature also had this from a man who served on the Institute of Medicine team that evaluated the California program in 2012.

Aaron Levine, Georgia Tech photo

"Aaron Levine, a science-policy researcher at the Georgia Institute of Technology in Atlanta, says that CIRM has put California at the center of stem-cell research worldwide. 'CIRM has been really important in driving stem-cell research forward, especially in the preclinical and proof-of-concept space,' he says. 

"But he isn’t sure whether that will convince voters to keep supporting the agency." 

The Nature article continued,

"'It will be interesting to see if the campaign is one of promised cures, or something a bit more nuanced,' says Levine. 'It takes time for a whole new field of research to result in cures, but that’s a hard case to make to voters in short sound bites.'"

Nature said Klein told it that he will form a non-profit lobbying arm in October or November to help support the campaign next year. 

The journal also said changes in the stem cell research program were anticipated in the new ballot initiative.  

"These include creating a dedicated staff of 10–15 people who would work with insurance companies and patients to improve access to clinical trials and future therapies."

Live Online: The 'Inside Scoop' on $3 Billion, California Stem Cell Research Effort?

The headline was provocative, and the question was "now what?"

It is the latest posting on the blog of the $3 billion California stem cell agency, which expects to run out cash for new awards as early as this fall. 

"Getting the inside scoop on the stem cell agency" -- That was the headline for the article, which promoted an online event July 25 involving three of the directors of the nearly 15-year-old agency, formally known as the California Institute for Regenerative Medicine (CIRM). 

"Now what?" is one of the questions they will address during the Facebook Live session. Viewers will have a chance to submit questions during the event and hear the answers. The immediate response is one of the benefits of such an event. Another is that they are preserved online for later viewing, multiplying the potential exposure in a significant way. 

That staying power is a benefit of considerable utility for the agency, which is not exactly a topic at the breakfast table in the homes of California voters. But they are the folks who the agency hopes will approve a proposed ballot initiative in November 2020 for an additional $5.5 billion for the research program. 

CIRM is currently engaged in a bit of an extra effort to educate Californians about the positive aspects of its work. In recent years, it has functioned in the usual obscurity enjoyed by most state agencies. However, unlike most state agencies, it does not survive financially on the usual budgetary process. 

CIR was born in 2004 with $3 billion, but nothing more.  So today the task is demonstrate to the people of California its value proposition. 

Taking up that task online in a couple of weeks will be CIRM directors Anne Marie Duliege, executive vice president and chief medical office Rigel Pharmaceuticals; Joe Panetta, president of BIOCOM, and Dave Martin, chairman and CEO of AvidBiotics. And CIRM is inviting Californians to join in the Facebook Live session "to understand how we got where we are, how the rest of the field is doing and what happens next."

California Stem Cell Opposition: Conservative Writer Declares Golden State Efforts a 'Bust'

In a preview of what is likely to be a heated ballot campaign next year,  a conservative writer declared this week that California's efforts to develop stem cell therapies are "a scientific and financial bust." 

"Back in 2004, the $3 billion California Stem Cell Research and Cures Initiative, Proposition 71, promised life-saving cures and therapies for Alzheimer’s, Parkinson’s and other diseases. The cures and therapies, in turn, would send money flowing into state coffers, so the project, in effect, would pay for itself. It didn’t exactly work out that way," said Lloyd Billingsley on two different web sites.  

"CIRM proved itself a scientific and financial bust, and almost completely off limits to state oversight."

Billingsley has written in the past about the agency, known as CIRM and formally as the California Institute for Regenerative Medicine. His latest columns appeared on the California Globe, which was founded by Ken Kurson, who has ties to the Trump family and Rudy Guiliani, and The Beacon.  

Billingsley likened the agency to the troubled bullet train project in California and efforts to solve some of California's water problems by building a tunnel under the California delta east of San Francisco. 

CIRM expects to run out of cash this year for new awards and hopes to survive with voter approval of a proposed, $5 billion bond measure on the November 2020 ballot.

It could be a hard-fought campaign, but conservatives and other likely opponents could well be diverted if President Trump is on the ballot. 

See here and here for more on Kurson, founder of the  California Globe, and here for the advisors to the Beacon web site and its parent organization.

Is the Governor of California a $5 Billion Stem Cell Friend?

Then San Francisco Mayor Gavin Newsom
 at 2005 announcement of stem cell HQ 
 

California's newly installed governor, Democrat Gavin Newsom, is no doubt a friend of the state's 14-year-old stem cell research program. 

But is he a $5 billion friend?

The question arises because the stem cell agency expects that its funds for new awards will dry up by the end of this year. It is pinning its hopes for survival on a proposed, $5 billion bond measure that may be placed on the November 2020 ballot. And the agency will need all the support it can muster to convince California voters to approve such a measure. 

Newsom's ties to the agency go back more than a decade. As then mayor of San Francisco, he was a key backer of the city's successful effort to lure the agency's headquarters, and he conjured up a $17 million package of incentives. 

He said at the time that the decision to locate the headquarters in San Francisco was a "proud moment." He said the incentive package demonstrated the "city’s unwavering commitment to innovation as scientists search for new methods to treat the world’s most challenging diseases and injuries."

(See here and here for more on Newsom and the selection of San Francisco as the agency headquarters.)

The agency is now based in Oakland. The free rent deal in Newsom's package expired, and San Francisco was too expensive for the California Institute for Regenerative Medicine (CIRM), as the agency is formally known. 

Newsom was busy last week with non-stem cell matters, such as a $209 billion budget he laid out for lawmakers. Given the nature of his and state priorities, he is unlikely to weigh in soon on a tentative ballot measure that is two years in the future. 

Newsom has sounded cautionary financial notes as he proposes ambitious spending plans. Some news stories have highlighted his willingness to pay down the state's debt, which figures into how the stem cell agency operates. 

In 2004, voters created the agency and also approved $3 billion for research awards. Those billions came from debt (bonds) taken out by the state. It is the first instance of a state funding scientific research with borrowed money. 

The interest on the bonds roughly doubles the cost of the agency, meaning a $10 million research grant really costs the people of California $20 million. 

Today, California is flush with cash because of a solid economy and a rainy day fund created by former Gov. Jerry Brown, also a Democrat. Some financial experts and economists are warning, however, that the good times will not be so good in 2020. That could color how voters perceive spending more on stem cell research.

Newsom may also have other, competing spending priorities come November 2020. He may want to husband his political capital to assure their approval. It is exceedingly unlikely, however, that he would oppose a new stem cell bond measure. But he could sit out a campaign for more billions for the agency. 

Given that possibility, maintaining a warm relationship with Newsom likely stands as an important priority for the agency and its backers -- one that they undoubtedly hope demonstrates both the value of stem cell research and the value it brings to the Newsom administration.

The Golden State's Stem Cell Agency Sells its 'Powerful' Story: 2,700 Discoveries, 50 Clinical Trials, Billions Awarded

Ronnie's California stem cell story

"Something Better Than Hope" -- That's the new anthem of California's $3 billion stem cell research program, which is scheduled this year to run out money for new awards.

The 14-year-old stem cell agency trumpeted its new slogan this morning when it released its annual report for 2018. It's a "powerful story," the agency declared on its blog. 

The 28-page document chronicled the state of affairs at the California Institute of Regenerative Medicine (CIRM), as the agency is formally known. The report is titled "Something Better Than Hope. Right Now." CIRM said, 

"While once there was only hope, now we know that cures are imminent."

Kevin McCormack, senior director of communications, celebrated the agency's annual review on its blog, The Stem Cellar. He wrote,

• "50 clinical trials funded to date, 7 this year alone
• "$2.6 billion in CIRM grants has been leveraged to bring in an additional

• "$3.2 billion in matching funds and investments from other sources.

• "1,180 patients have been involved in CIRM clinical trials"

The report itself said,

"CIRM has funded 1,000 projects at more than 70 institutions in California and is the largest single funder in the world of clinical research for stem cell and regenerative medicine. More than 2,700 medical discoveries have been peer reviewed and published in scientific journals. But, most importantly, lives have been saved, second chances have become possible and cures have risen beyond hope."

Stories of the lives of patients in clinical trials were not neglected, including Ronnie, the toddler in the video at the top of this item.

Maria Millan, the CIRM CEO who was a pediatric surgeon earlier in her career, wrote,

"CIRM’s mission is to accelerate stem cell treatments to patients with unmet medical needs.  

"Think about patients like baby Elianna on page 2. She was treated with stem cells for a life-threatening blood disorder while still in her mother’s womb. Ronnie (page 15), who was born with what was previously considered a fatal immune disorder, is alive and thriving today. These stories inspire and motivate us to continue to build upon the great strides CIRM has already made "

The annual report is expected to serve as an important tool as the agency attempts to raise privately more than $200 million to back its efforts until the fall of 2020. That is when CIRM is hoping that California voters will approve $5 billion more for the agency so it can continue its work. 

Annual reports from businesses and government agencies are predictably tilted towards the most positive view of their performance. CIRM's report is no exception. Nonetheless, the agency has run up a record of accomplishment that is significant and important. However, it has not yet fulfilled the expectations of voters in 2004 who were led to believe that nearly miraculous stem cell cures were right around the corner.

Don Reed is a patient advocate who has not lost faith in the promise of stem cells. The California stem cell agency is also indebted to him for his ability to turn the phrase that adorned the cover of the annual report. He was quoted in the report as saying:

"Today, thanks to the 7.2 million voters who authorized the California Institute for Regenerative Medicine, or CIRM, we have something better than hope; we have results, accomplishments, people made well— and a systematic way to fight chronic disease."

Hype and Fraud and Their Impact on the California Stem Cell Program

Cartoon by Johan Thyberg from "For Better Science"

The New York Times this week published a piece about how the lust for success could be corrupting science in a greater way. 

The questions it raises have particular relevance in the stem cell field, which is still very much in a formative stage. 

Aaron Carroll, a professor of pediatrics at the University of Indiana, produced the opinion piece for the Times. He wrote, 

"How might grant funding and career advancement — even the potential for fame — be biasing researchers? How might the desire to protect reputations affect the willingness to accept new information that reverses prior findings?"

He also said, 

"Moves toward open science, and for a change in the academic environment that currently incentivizes secrecy and the hoarding of data, are perhaps our best chance to improve research reproducibility Recent studies have found that an alarmingly high share of experiments that have been rerun have not produced results in line with the original research."

Questions arise with some regularity about hype and fraud in stem cell research. Back in 2014, bioethicist Art Caplan asked, “Why so Much Fake, Unduplicable Stem Cell Research?”

Just this past fall, a multimillion-dollar stem cell research scandal involving Harvard surfaced once again in the news.

Credibility, of course, is everything in science. For the California stem cell agency, it is a matter of survival. It will be out of cash for new awards in less than 12 months and is hoping voters will then give it an additional $5 billion.  More news about stem cell hanky panky, wherever it occurs, will not serve the agency well when it makes its pitch once again to the people of the Golden State.  

Tax Breaks and $220 Million for California Stem Cell Agency

The California stem cell agency, which is facing its financial demise, is seeking assurances of "continued tax breaks" for private donors who are being courted for $220 million to support the enterprise, Bloomberg Law reported this week. 

The article by Joyce Cutler referred to the effort to bridge a looming and major stem cell funding gap. The agency says it will run out of cash for new awards at the end of next year. But it does not see additional public funding until November 2020, when the agency hopes that California voters will refinance it with $5 billion from a yet-to-be written ballot initiative. 

Cutler wrote,

"Closing the deal, however, involves getting assurances from elected officials of continued tax breaks to get donors to open their checkbooks and keep CIRM operating until another bond measure can be passed." 

CIRM is the abbreviation for the California Institute for Regenerative Medicine, the formal name of the stem cell agency. It was created in 2004 by voters who provided it with $3 billion in state bonds, but no more. 

Asked for comment by the California Stem Cell Report, Kevin McCormack, senior director for communications at CIRM, said,

"With regard to the tax deductibility issue, that’s really out of our hands but, of course, we’re hopeful that all incentives to potential donors are preserved going forward."

Cutler wrote, 

"Contributions to state agencies currently are deductible from income under state and federal law, H.D. Palmer, state Department of Finance spokesman, told Bloomberg Law in an email.

"'Going forward, that’s going to fall to the next folks who get the keys to the car' in the governor’s office and Legislature, who will decide whether the California deductions remain.

"But the federal Internal Revenue Service is considering regulations to disallow deductibility if the tax credit is for more than 15 percent of the contribution. The Tax Cuts and Jobs Act of 2017 limits the amount of state and local taxes (SALT) an individual can deduct on taxes to $10,000 a year. The proposed regulations crack down on state workarounds to the SALT deduction cap."

Jonathan Thomas, chairman of the CIRM board, is leading the effort to raise funds privately. Bob Klein, who preceded Thomas as chairman, has a role but the agency has declined to go into details. Klein is a real estate investment banker and founder and chairman of Americans for Cures, a nonprofit organization supporting stem cell research. 

Klein has said he has a poll that shows that more than 70 percent of Californians support refinancing the agency. But he has declined to release the poll or identify the firm that provided it when asked by the California Stem Cell Report.  

Klein oversaw the writing of the ballot initiative that created the stem cell agency in 2004 and led the electoral campaign on its behalf. He has said he will try again in 2020 if polls show sufficient support. 

At last week's CIRM board meeting, Thomas gave a short report on the private fundraising effort, which has been underway for many months. He did not announce any contributions or discuss the tax break issue. 

At the meeting, board member Jeff Sheehy expressed concern about progress on a possible 2020 bond measure, noting that there is a relatively short amount of time to mount a major political effort.

Art Torres, vice chairman of the board and a former state legislator, said no real effort can be mounted until after the elections next month. Torres and CIRM general counsel Scott Tocher also noted there are legal limits on what the agency can do in terms of a ballot campaign. 

Possible Federal Restrictions on Stem Cell Research and the Multi-Billion Dollar California Angle

The recent federal crackdown on the use of fetal tissue in scientific research could well be a harbinger of an effort to revive restrictions on the use of human embryonic stem cells, placing a roadblock in the way of creation of therapies to treat often deadly afflictions that affect millions of Americans.

And it could have an impact on the fate of California's $3 billion stem cell program, which expects to run out of money for new awards by the end of next year.

A leader of the pro-life movement signalled today that anti-abortion groups' next target is likely to be the National Institutes of Health(NIH), which provide billions of dollars in research funding, including use of embryonic stem cells (hESC).

Writing on The Hill web site, Tom McClusky, president of March for Life Action, denounced current federal research practices. His opinion piece was headlined.

"Trump's move on unethical fetal tissue experimentation isn't enough"

McClusky wrote,

"The head of NIH, Frances Collins, has been a long-time supporter of unethical research and has a reputation of disinterest for the countless lives lost as long as it produces results.
"His track record not only includes support for fetal tissue research but also human-embryonic stem cell experimentation, human-animal chimeras and even human cloning. Of the many great nominations made by President Trump, Frances Collins sticks out as a counter to his stated pro-life agenda."

This is a bit of deja vu for the California stem cell agency, whose $3 billion program was approved by voters in 2004. The impetus for creation of the agency, known formally as the California Institute for Regenerative Medicine (CIRM), was generated by then President Bush's restrictions on federal funding for hESC research. State cash, however, was not similarly restricted.

Trump has not yet revived Bush's restrictions, but the issue seems to be increasing in importance for Trump's evangelical political base and at least 102 congressmen. The opposition is based on the belief that using human embryonic stem cells for research is tantamount to murder.

The stem cell agency is hoping that California voters will extend its life in November 2020 by approving $5 billion more for the research. However, the agency has not delivered on 2004 expectations that stem therapies were right around the corner. The agency has yet to finance a therapy that is widely available.

Overcoming voter disenchantment could be difficult. But a Trump crackdown could energize stem cell supporters much as Bush's did in 2004. Scientists, patient advocate groups, venture capitalists and others banded together to win approval of the ballot initiative that created the state stem cell program, using Bush as a handy villain in the argument for more stem cell research.

Ironically, the article by the pro-life group came almost exactly one year after the then president of the International Society for Stem Cell Research,  Hans Clever, wrote on the Stat website that fetal tissue is absolutely necessary to produce cures and therapies. He said,

"The development of vaccines against polio, rubella, measles, chickenpox, adenovirus, rabies, and treatments for debilitating diseases such as rheumatoid arthritis, cystic fibrosis, and hemophilia all involved fetal tissue."

"Fetal tissue has been essential in research used to develop therapies that have saved millions of lives, and it continues to be necessary for the future of medicine."

The Reality of Stem Cell Research vs. Results: A Scientist/Blogger Speaks Out on California's Efforts

A researcher writing on the web site of Science Translational Medicine weighed in last week on California's $3 billion stem cell agency, raising questions about its progress, hype and the fate of the nearly 14-year-old effort. 

In an item Sept. 28 on the blog "In The Pipeline," Derek Lowe said, 

"It’s not like the CIRM money has all been wasted, of course. There’s been a lot of basic research done, and there certainly has been a lot that needed to be done. The amount of brush to be cleared in human developmental cell biology is just monumental. A quick thought the way that all of your body, all the bodies of every human being, comes each from their own single cell will make that clear. If you want stem cell therapies to regenerate organs – as who doesn’t – then you’re asking for a thorough understanding of that process. You may well be asking to do even more than it can tell us how to do."

CIRM is the California Institute for Regenerative Medicine, as the agency is formally known. Lowe's brief bio on the the site says he has worked for "several major pharmaceutical companies since 1989 on drug discovery projects."

The occasion for his remarks was the recent lengthy look at the agency by the San Francisco Chronicle at CIRM and its performance. Lowe wrote, 

"What’s happened? What you’d have expected, if you knew the field at all (or were familiar with basic research in general). None of the bigger promises made during the campaign to fund the CIRM have come true. No approved therapies have come out of the work yet – and that’s one of the class of promises that were most egregious, in California and elsewhere. Just imagine the time it takes from discovery to approval for something like this, and then factor in that the needed discovery hadn’t even been made yet. But if you don’t know anything much about stem cells, or regulatory approvals, or medicine in general, the idea of get-out-of-that-wheelchair cures being just around the corner becomes more plausible."

Lowe also noted that voters may be asked in 2020 to provide more billions for the agency. He said, 

"If you measure it (the agency's work) against what was known and what had been accomplished then versus what’s been done since, you can make a case, for sure. If you measure it against the promises made at the time, though, things look bad. And that informs how you’re going to campaign for renewal: do you point at what’s been done and make the argument that it’s been a success, or do you promise them miracle cures again, because now they just have to be around the corner after all this work, eh?"

Lowe's article received comments from nine readers, who appear also to be researchers. One, who was identified as Miguel Sanchez, wrote, 

"Just at my small CA research institute, the amount of poor science that has been funded by CIRM is staggering. I would say that roughly half the CIRM money we have received has gone to research programs that are prima facie bad science but the PIs are well connected so hey shut up. I don’t think any outright fraud has been published, but the taxpayers of CA are for damn sure not getting their moneys worth on these investments here."

Sanchez did not further identify his employer. The agency's list of grantees did not contain Sanchez's name. 

'Better Than Hope' -- An Advocate's View of California's $3 Billion Stem Cell Research Program

Don Reed 

Longtime patient advocate Don Reed appealed to California lawmakers last week to support the state's stem cell research effort, which expects to run out of money for new awards at the end of next year.

He said,

"Today, thanks to the 7.2 million voters who authorized the California Institute for Regenerative Medicine, or CIRM, we have something better than hope; we have results, accomplishments, people made well—and a systematic way to fight chronic disease."

Reed was among the persons testifying last week before the state Assembly Select Committee on Biotechnology.

He  is vice president of Americans for Cures, a nonprofit group founded by Robert Klein, a real estate investment banker and who ran the ballot initiative campaign that created the $3 billion California stem cell agency. Klein was also the agency's first chairman and may lead another ballot initiative in November 2020 to renew the agency with an additional $5 billion.

Here are links to the remarks at the hearing by CIRM CEO Maria Millan, Art Torres, vice chairman of the CIRM board, and David Jensen, publisher of this web site.  Tomorrow the California Stem Cell Report will carry a look at the remarks by Jan Nolta, head of the stem cell program at UC Davis.  

The full hearing can be seen here and downloaded with closed captioning. An audio file is also available at the same URL. Here is the text of Reed's remarks.
(Some readers have reported that they cannot download Reed's comments shown below. However, I cannot detect any problem with that process. If you would like a PDF of Reed's remarks, please email me at djensen@Californiastemcellreport.com.)

   2018-08-15 Reed Assembly Biotech Hearing by DavidJensen on Scribd

CEO Millan Makes the Case for California's $3 Billion Stem Cell Research Program

Maria Millan, CEO of CIRM, at state Assembly hearing last week

The top executive at California $3 billion stem cell agency, which expects to run out of cash for new awards next year, outlined for state lawmakers last week the benefits of the nearly 14-year-old program.

Maria Millan, president and chief executive officer of the California Institute for Regenerative Medicine (CIRM), as the agency is officially known, laid out how the agency funds "the most innovative, high risk but high reward" stem cell research in the state.

Millan highlighted some of the 49 clinical trials backed by CIRM. She said,

"Every single trial represents a tremendous breakthrough approach that was unimaginable and even the subject of science fiction just years ago."

She also discussed the agency's relationship with the stem cell industry in backing research during a risky financial stage called "the valley of death." She said,

"CIRM supports and de-risks through this stage, where industry and traditional investors are not yet ready to come in. By accelerating development and allowing these early stage trials to proceed with CIRM funding, we have enabled the projects to gain visibility and interest leading to an increase in industry investments."

Her presentation was generally well received by the five lawmakers who were in attendance at various times during the meeting of the Assembly Select Committee on Biotechnology, chaired by Kevin Mullin, D-San Mateo.

The full hearing can be seen here and downloaded with closed captioning. An audio file is also available at the same URL. Tomorrow the California Stem Cell Report will carry the text of remarks by Art Torres, vice chairman of the agency and a former state legislator.  This writer was also invited to appear at the session. My remarks can be found here.

Here is the full text of Millan's comments.
Remarks by Maria Millan, President of CIRM, To California Assembly's Select Committee on Biotechnology 2018... by DavidJensen on Scribd

'Spontaneity' Live: A Powerful, Cyberspace PR Tool for California's Cash-Strapped Stem Cell Program?

Jeanne Loring, right, on a Scripps Research Institute
Facebook Live event last week.   Click here to go to the video. 

Stem cell researchers rarely have a chance to talk directly about their work to thousands of people at a time, including those in the farthest reaches of the globe.

But Jeanne Loring at the Scripps Research Institute did it last week. The California stem cell agency did it last month with Stanford researcher Gary Steinberg.  And it could well be that the technique that they used will emerge as a critical tool in the effort to stave off the death of the $3 billion, stem cell program. The end could come as early as 2020 if agency supporters fail that year to win voter approval of $5 billion more for the program.

The medium in use by Loring and the agency is something called "Facebook Live."  It is a live streaming service that allows viewers to ask questions and comment during a webcast conducted by researchers or stem cell research advocates.  It is considerably more compelling than pre-recorded videos, says Forbes magazine, which reports that presentations on Facebook Live are viewed for three times as long as a static video. The thinking is that the interactive connection and the initial live presentation -- with its informality, spontaneity and lack of predictability --  are more interesting than your usual, pre-recorded sessions.

Facebook Live has been around since 2016.  but has rolled out slowly. According to a Google search this past weekend, only a handful of stem cell-connected enterprises have taken advantage of it. (See a few below.)

Viral Boost for the California Stem Cell Message

In its presentation last month, the stem cell agency started off with about 80 viewers. By the time of this writing the number of views of the video had skyrocketed to more than 6,800. Loring's presentation now stands at 1,600. Her number grew by 100 as this article was being written. That viral strength likely surpasses many static offerings in print coverage or conventional electronic news, which are largely onetime shots.

(The agency, on the morning following this posting, filed an item on its blog, hailing the success of the program. The item said, "We had an amazing response from people during the event and in the days since then with some 6,750 people watching the video and almost 1,000 people reacting by posting a comment or sharing it with friends. It was one of the most successful things we have ever done on Facebook so it’s not surprising that we plan on doing many more Facebook Live ‘Ask the Expert’ events in the future.")

One might ask: Why is the impact of this single Facebook event important in terms of a stem cell ballot campaign?

In recent years, the stem cell agency has slipped out of the public eye and is hard-pressed to attract widespread media attention, a situation that is commonplace for most state government departments. The agency's "value proposition" is not well understood, say officials at the agency, formally known as the California Institute for Regenerative Medicine (CIRM). 

To win approval of a proposed $5 billion bond measure in November 2020, however, CIRM will need strong support for its efforts, which have so far failed to deliver on the public's expectations that miraculous stem cell therapies are right around the corner. Those hopes were raised more than 13 years ago during the campaign that created the stem cell agency. Today its funds are running out. Cash for new awards is  expected to vanish by the end of next year.

Selling Hope to Half of California Families

Nonetheless, one of CIRM's notable products is hope -- not to mention 49 clinical trials that could lead to therapies for deadly diseases and widespread afflictions ranging from cancer to urinary incontinence.

In 2004, backers of the stem cell ballot measure declared that "medical problems that could benefit from stem cell research affect 128 million Americans including a child or adult in nearly half of all California families."

Reaching those California families is the key to unlocking their votes on behalf of the stem cell program. Facebook -- notably and coincidentally -- reaches nearly half of the Internet users  in California.

Using Facebook Live, or rival services, may well be the most effective way to connect with those important voters, especially with the help of the patient advocates who have been heavily involved with the agency. They bring the personal stories that resonate with voters and create an emotional appeal that is likely to trigger a favorable vote for more billions.

More services like Facebook Live will probably arise in the next 12 months. But Facebook has an advantage: the huge number of its users and an established Internet base that includes the patient advocate community and its organizations.

Writing on Forbes about business applications of Facebook Live, Steve Olenski said:

"Live video comes with a generous helping of transparency. Your influencer's voice will ring truer in a live conversation with fans than it does in a blog post. Viewers can engage with your product or service and the influencer in open conversation handled in real time.

"If you're looking for a compelling way to build trust with your audience, a live video is a great place to start."

Here are links to a few Facebook Live events involving stem cell-related matters: Difference between gene therapy and stem cell therapy, CAR T-Cell Therapy for Non-Hodgkin Lymphoma, Gene Therapy for Sickle Cell Disease.

Golden State's Stem Cell 'Value:' Bubble Boy Disease and Bringing a Therapy to Market

California's $3 billion stem cell agency today performed a double, PR whammy in an effort to create a greater public understanding of the "key role" it can play in the most expensive and critical steps in creating a therapy that is widely available to the public.

The agency's pitch comes as it faces its potential demise in two years unless it is successful in raising more funds for its operations.

Donald Kohn, UCLA photo

The agency's starting point today involved research for cures for an affliction that has received highly visible, albeit intermittent, coverage over the past several decades. The fatal affliction is often referred to as the "bubble boy" syndrome or, more accurately, SCID,  Severe Combined Immune Deficiency.

In this case, it involves UCLA scientist Donald Kohn, a British firm, Orchard Therapeutics, Inc., opening new facilities in California (Menlo Park and Foster City) and a $20 million award. The cash, however, is only a relatively small piece of the state's immune deficiency investment. 

$141 million for immuno deficiencies

Over the years, Kohn's research has been backed by at least $52 million from the taxpayer-financed California Institute for Regenerative Medicine (CIRM), as the agency is formally known. Overall, it has pumped more than $141 million into immune deficiency disorders, not all of which is directly related to SCID. 

Responding to a query, Kevin McCormack, senior director for CIRM communications, said,

"We’re a lot more than just a pretty face you know. We feel we’re helping change the face of medicine."

Or as Maria Millan, president of CIRM, said both in a news release and in an article on the agency's blog, The Stem Cellar: 

"We invest when others are not ready to take a chance on a promising but early stage project. That early support not only helps the scientists get the data they need to show their work has potential, but it also takes some of the risk out of investments by venture capitalists or larger pharmaceutical companies."

She continued, 

"Our funding and partnership has enabled the smooth transfer of Dr. Kohn’s technology from the academic to the industry setting while conducting this important pivotal clinical trial. With our help, Orchard was able to attract more outside investment and now it is able to grow its pipeline utilizing this platform gene therapy approach.”

De-risking stem cell therapies

In biotech, all this is referred often as "de-risking" and helping research advance beyond the "valley of death," the stage at which conventional financing for research becomes exceedingly difficult to secure. Both have been goals of the agency for some time and are part of what Millan refers to as the agency's "value proposition." 

Boosting public recognition of the value created by CIRM is likely to be a key element in winning approval of a proposed $5 billion bond initiative in 2020, seeking more cash for the agency. The agency estimates that it will run out of money for new awards at the end of next year. 

The agency noted the significance of the deal that GlaxoSmithKline(GSK) made last month with Orchard.  Although the agency tends to focus strongly on medical and scientific achievements, today's PR hit had a stronger emphasis on business matters. Without a successful business model, it is unlikely that any CIRM research will reach the general population.

California's key role

CIRM said,

"Under the deal, GSK not only transfers its rare disease gene therapy portfolio to Orchard, it also becomes a shareholder in the company with a 19.9 percent equity stake. GSK is also eligible to receive royalties and commercial milestone payments. This agreement is both a recognition of Orchard’s expertise in this area, and the financial potential of developing treatments for rare conditions."

Mark Rothera, Orchard photo 

The agency quoted the CEO of Orchard, Mark Rothera, as saying,

"The funding and advice from CIRM allowed Orchard to accelerate the development of OTL-101 and to build a manufacturing platform to support our development pipeline which includes 5 clinical and additional preclinical programs for potentially transformative gene therapies."

The GSK-Orchard deal, CIRM said, was "good news for both companies and for the patients who are hoping this research could lead to new treatments, even cures, for some rare diseases. It was also good news for CIRM, which played a key role in helping Orchard grow to the point where this deal was possible."