A Business Perspective on Stem Cell Grant Appeals

A stem cell company business executive sent the following comment via email concerning the item on the four appeals that have been filed on grant applications to be considered by the board of the California stem cell agency Wednesday and Thursday:

“I find it very interesting that the academics have found a way to appeal decisions that they do not agree with.  Outstanding for-profit company grant applications have been denied any right of appeal for years. In my discussions with some of the school who are appealing, their common complaint is that the reviewers did not read their applications, must have been someone else’s!  WOW!  Ninety-seven percent of funds to date have gone to the academics. Of the 3 percent, most of it went to three handpicked companies.  Looks like the status quo is not changing.  I predict that a year from now the percentages will be about the same.”

Business Success Rate at Stem Cell Agency: Zero in Latest Round After 14 Fail

California biotech companies chalked up a zero in the latest funding round by the state's $3 billion stem cell agency, although 14 tried to run a gauntlet that industry has complained about for years.

All $69 million in last month's translational research round went to 21 academic and nonprofit insitutions. No business received an award. One firm, Eclipse Therapeutics of San Diego, appealed to the agency's governing board but was not successful despite having a higher scientific score than at least two winners.

The miniscule amount of funding for commercial enterprises – less than 4 percent of $1.4 billion handed out so far – has been a matter of concern for some time for both industry and some members of the CIRM governing board. Most recently, industry executives complained at an April hearing of the Institute of Medicine panel looking into CIRM's operations. Even a 2010 review commissioned by CIRM said the agency needed to do better by business.

The question of funding goes beyond a simple matter of fairness or "good science," as CIRM describes its funding goal. Without efforts by industry to turn research into cures, CIRM will not be able to fulfill promises to voters in 2004 when they approved creation of the stem cell agency. CIRM last month approved a set of five-year goals that push more aggressively for development of commercial products, but the goals lacked such things as a financing round devoted solely to business applicants.

In last month's translational round, applicants went through a three-step process, which is conducted primarily behind closed doors. First came what CIRM calls pre-applications. Those were reviewed by CIRM staff with the help of outside advisors if necessary. Applicants who cleared that hurdle were allowed to apply for the full, peer-reviewed round. During that process, the CIRM Grants Working Group reviews applications, makes decisions and sends them to the full CIRM board for ratification and possible changes. The board almost never has rejected a grant approved by reviewers. But the board has ultimate authority and sometimes funds applications that reviewers have rejected. The applicants' names are withheld from the board and the public during the process, although some of the board discussion and the final vote is conducted in public. CIRM does not release the names of rejected applicants unless they appeal.

In the translational round, a total of 42 pre-applications out of 167 were approved by staff, according to CIRM. Thirty-eight came from nonprofits and academics out of the 153 such institutions that applied. Four out of 14 business pre-applications advanced to full applications but none made the final cut. All of the winning applications were linked to institutions that have representatives on the CIRM governing board. Those representatives are not allowed to vote on or take part in discussion involving applications to their institutions.

The primary decision tool used by the grant review group is a scientific score. In last month's round, scores of approved grants ranged from 88 to 53. However, eight grants that were ranked above 53 were rejected by the board. One of those higher-ranking applications came from San Diego's Eclipse Therapeutics, which scored 58. The low-ranking grants were approved for what CIRM describes as "programmatic" reasons.

More than three weeks ago, the California Stem Cell Report asked CIRM for figures on the numbers of applications in the translational round, including those for business. CIRM said the figures had not been compiled and would not be available until after the awards were made on May 24. The numbers were finally supplied yesterday.

Our take: The number of applicants, and their breakdown, is basic information that should be part of board's decision-making process. The statistics should be routinely available well in advance of the board's meeting. Indeed, the agency in its earlier days used to routinely publish the figures. It may be now that generating them is more time-consuming than necessary. The recent performance evaluation of the agency said CIRM needs to make major improvements in how it handles critical information needed for its top management and board.

Whatever the reason, given CIRM's poor track record with business, the agency's directors should diligently track industry's success rate on applications. If proposals ranked as low as 53 are approved while higher ranking applications from business are bypassed, it warrants more than cursory examination.

'Sun Never Sets on CIRM' – California Agency Awards $69 Million to Researchers

The California stem cell agency today awarded $69 million in grants, including the first involving a collaboration with researchers in China, but none of the awards went to California biotech businesses.

The awards were made in the agency's third translational round, which funds projects that are in the initial stage of identifying drugs or cell types that could become drug therapies.

CIRM originally allocated $95 million for the round, but CIRM spokesman Kevin McCormack said that grant reviewers determined that no applications beyond $69 million were worthy of funding.

The CIRM governing board overturned a negative reviewer decision on one grant after the scientist – W. Douglas Boyd of UC Davis -- filed an appeal. The appeals of two other researchers, including one from a San Diego business, were not successful (see here and here).

CIRM did not disclose the number of applications from businesses. The agency has been sharply criticized for failing to fund businesses in a substantial way.

The approved grants involve collaboration with researchers in Australia and Germany as well as China. The collaborations are based on agreements worked out earlier by CIRM with overseas groups, which fund their own countries' researchers. No CIRM cash is involved, according to the agency.

CIRM President Alan Trounson, a native of Australia and researcher there until joining the stem cell agency, said in a press release,

"The sun now never sets on the CIRM collaborative projects..."

The news release also said,

 "The Chinese Ministry of Science and Technology has committed roughly $850,000 in collaboration with a team at UCSF to study liver failure. This is the stem cell agency’s first joint effort with scientists in China, which is home to a fast-growing stem cell research community."

The UCSF liver team is led by Holger Willenbring, whose goal is "to develop a source of autologous therapeutic cells for patients with liver disease who otherwise would require a liver transplant," according to the CIRM review summary. The agency did not spell out the details of how the collaboration would work.

All of the winning applicants, with the exception of a Salk researcher, work for institutions linked to at least one of the 29-members of the CIRM governing board. CIRM directors, however, are barred from voting or even discussing applications in which CIRM attorneys have determined there is a conflict of interest.

You can find the names of all the successful applicants in the CIRM news release.    

California Stem Cell Agency Launches $30 Million Plan to Lure Industry

Just one week after the $3 billion California stem cell agency was sharply criticized for its failure to adequately support biotech firms, the agency formally kicked off a $30 million effort to engage industry more closely.

The initiative, in the works since the middle of last year, was heralded as the beginning of a "new era" for CIRM, which is moving to transform into cures the stem cell research it has funded over the last seven years. The agency has scheduled a webinar for April 25 for prospective applicants.

CIRM's press release, crafted by the agency's new PR/communications director, Kevin McCormack, yesterday quoted CIRM President Alan Trounson as saying,

"This initiative is a major new development in the progress towards providing new medical treatments for patients by engaging the most effective global industry partners."

Elona Baum, the agency's s general counsel and vice president of business development, said the program "represents a new era for CIRM."

Under the RFA, the agency will award up to $10 million each for three grants or loans. The program, however, is not limited to businesses. Non-profits may apply as well. Representatives from industry have complained about a strong tilt on the part of CIRM towards academic and non-profit research enterprises. The CIRM board is dominated by representatives from those two sectors.

The program grew out of recommendations in November 2010 from an "external review" panel put together by CIRM that said the agency needed to do better with business. The refrain was heard again directly from stem cell firms at last week's hearing by the Institute of Medicine on the stem cell agency's performance. According to CIRM's figures, businesses have received $54 million in grants and loans since 2005, the first year the CIRM board approved grants, out of a total of $1.3 billion.

Only one news outlet has written a story so far about the posting of the RFA and the press release, as far as can be determined.

Ron Leuty of the San Francisco Business Times said,

"The most likely candidates to attract industry funding would be CIRM’s 'disease team' grant winners, who face a deadline of 2014 to bring a project to the point of first-in-human clinical trials. CIRM has weighed options for pushing those projects — there are 13 of them now — deeper into the FDA approval process."

CIRM said in the RFA material,

"The intent of the initiative is to create incentives and processes that will: (i) enhance the likelihood that CIRM funded projects will obtain funding for Phase III clinical trials (e.g. follow-on financing), (ii) provide a source of co-funding in the earlier stages of clinical development, and (iii) enable CIRM funded projects to access expertise within pharmaceutical and large biotechnology partners in the areas of discovery, preclinical, regulatory, clinical trial design and manufacturing process development.

"This initiative requires applicants to show evidence of either having the financial capacity to move the project through development or of being able to attract the capital to do so. This may be evidenced by, for example, (i) significant investment by venture capital firms, large biotechnology or pharmaceutical companies and/or disease foundations; or (ii) a licensing and development agreement with a large biotechnology or pharmaceutical company or a commitment to enter into such an agreement executed prior to the disbursement of CIRM funding.

"The objective of the first call under this initiative, the Strategic Partnership I Awards, is to achieve, in 4 years or less, the completion of a clinical trial under an Investigational New Drug (IND) application filed with the Food and Drug Administration (FDA)."

CIRM has scheduled a webinar on the RFA for prospective applicants for next Wednesday, April 25. It is asking for registration and questions in advance.



(Editor's note: An earlier version of this article did not contain the sentence about businesses receiving $54 million out of $1.3 billion awarded by CIRM.)

CEO of Biotime's Comments on Stem Cell Agency and Development of Therapies

Michael West, CEO of Biotime, Inc.of Alameda, Ca., has published the text of his prepared remarks to the Institute of Medicine panel examining the performance of the $3 billion California stem cell agency.

Here is one excerpt from the statement by West, who was also CEO at Advanced Cell Technology and founded Geron.

"To put it simply, stem cell research by itself will not lead to cures. Research and DEVELOPMENT leads to cures. In my opinion, if CIRM fails to deliver on its goal to deliver cures, it will not be a result of internal governance issues. Instead, it will be a result of inefficient capital allocation. A graphic way of visualizing my point is to say that CIRM has historically funded primarily research, and little product development, i.e. large “R” little “d”. Approximately 5% of CIRM’s expenditures have been allocated to biotechnology and health science entities whose expertise is product development, and 95% has been allocated to nonprofit institutions in the state for basic research. Human therapeutic product development in the United States requires a very intense and expensive process for approval that is primarily focused on development side of the equation. In this respect, therapeutic approvals differ significantly from the discovery and development of silicon-based technologies that have been so successfully commercialized in California."

Here is a link to the full text of what West posted on the Biotime web site.

Correction: ACT Not Rejected 15 Times by California Stem Cell Agency

A venture capitalist who said earlier this week that the California stem cell agency rejected 15 grant applications from Advanced Cell Technology this afternoon retracted the statement, which he said was incorrect.

Gregory Bonfiglio, managing partner in Proteus Regenerative Medicine, said in an email,

"Although I believed that number to be true at the time I stated it, I have now determined that the number of CIRM grant applications ACT filed as the principal investigator was substantially below 15."

Bonfiglio made the assertion Tuesday at a meeting of the Institute of Medicine panel looking into the performance of the $3 billion California stem cell agency, which has been criticized for its lack of funding of biotech firms.

Here is more of what Bonfiglio had to say in his email this afternoon,

"Unfortunately, your California Stem Cell Report posting on April 11 contains some inaccurate information, for which I appear to have been the source.  As you will recall, I stated during the IOM Panel that Advanced Cell Technology had submitted multiple applications for funding from CIRM, but had been unsuccessful in obtaining any funding from CIRM.  I also stated that ACT had been involved in “15 grant applications” to CIRM.   You highlighted that number in your April 11 California Stem Cell Report posting.   Unfortunately, that number is not accurate.  Although I believed that number to be true at the time I stated it, I have now determined that the number of CIRM grant applications ACT filed as the Principal Investigator was substantially below 15.   The number I quoted in the IOM Meeting on April 10 included applications in which ACT had some involvement, but was not the lead principal Investigator.  ACT has filed several applications for CIRM funding as the lead PI, but the number of CIRM applications in which ACT was the lead PI was far below 15.   Moreover, some of ACT’s direct applications for CIRM funding were withdrawn by ACT, rather than denied by CIRM.

"I would request that you correct this inaccuracy regarding ACT's applications for CIRM funding as soon as possible.  I'm sure you will agree that the regenerative medicine community, and the general public, have a real and significant interest in obtaining accurate information about developments at CIRM, and that the publication of inaccurate information is a tremendous disservice to all involved.  More importantly, ACT is a publicly traded company and the publication of inaccurate information regarding ACT, its technologies, or its funding could have adverse consequences for the company.   Furthermore, as an active participant in the regenerative medicine community who has spent his professional career developing a reputation for honesty, accuracy, and integrity I am very concerned that I might be the source of inaccurate information regarding developments within the field of regenerative medicine.  For these reasons, I would ask that you retract the statement in your April 11 Blog posting that ACT was 'rejected 15 times for funding' by CIRM, and that you refrain from making any other statements to that effect.

"I appreciate your cooperation in this regard, and I would request that you move quickly to correct the inaccuracy in your April 11 Blog posting.   As I am sure you are aware, information in blog postings is sometimes picked up by more traditional media, and I would not want any republication of this inaccurate information regarding ACT’s grant applications to CIRM."

At the time Bonfiglio made his comments concerning ACT, top officials of the stem cell agency were in the room, but did not make any statement concerning his assertion. On the morning of April 11 prior to publication of the item, the California Stem Cell Report asked ACT for comment .

No response has been received from ACT about the figure. CIRM also has not commented since the item appeared.

California Stem Cell Agency Nixes ACT Grant Applications 15 Times

(Editor's note: The assertion in this item that 15 applications by ACT were rejected by the California stem cell agency is incorrect, according to the venture capitalist who made the statement. He retracted it on the afternoon of April 12. His explanation can be found here. )


IRVINE, Ca. --The only firm in the nation conducting an ongoing hESC clinical trial has been rejected 15 times for funding by California's $3 billion stem cell agency.

The figure was reported yesterday at a hearing by the blue-ribbon Institute of Medicine panel looking into the performance of the stem cell agency, which has been sharply criticized in recent years for its paucity of industry funding.

Gregory Bonfiglio, managing partner in Proteus Regenerative Medicine, a stem cell venture capital firm in Portola Valley, Ca., disclosed the grant attempts by Advanced Cell Technology, whose nominal headquarters are in Santa Monica, Ca. Bonfiglio indicated that it was a high profile example of how CIRM is not taking the necessary steps to fulfill its goal of developing therapies that actually reach the clinic.

He noted that ACT received national attention in January when it posted favorable findings for its clinical trial at UCLA dealing with blindness but that the firm was still unable to win a CIRM grant over the last several years.

ACT had moved much of its operations to California in the wake of passage of Proposition 71, the measure that created the state's stem cell research effort in 2004. It has since re-centered its operations in Massachusetts.

The California Stem Cell Report has queried ACT on its grant efforts and will carry its response verbatim when it is received.

Another firm, which cannot be identified, said privately yesterday that it was rejected 14 times.

According to our calculations based on figures this morning on the CIRM web site, businesses have received only $54.3 million in grants and loans during the last seven years, 4 percent of the $1.3 billion awarded. However, the CIRM list slightly understates the industry total. At least two other firms are sharing in two $20 million grants involving academic institutions, but are not noted on the list.

Yesterday's IOM meeting was the second and final California public session for the CIRM inquiry. Most of the day was occupied by a variety of critiques of the organization. The panel has already heard extensively from the agency itself and beneficiaries of its grants. The IOM report is expected in November.

Harold Shapiro, chairman of the panel and former president of Princeton University, described yesterday afternoon's panel involving stem cell business executives as "one of the more interesting" of the day.

One of the speakers was Michael West, CEO of Biotime in Alameda, which has received $4.7 million from CIRM. West, the founder of Geron, was also head of ACT when it moved it to California. He said CIRM had several "blind spots," including misconceptions about how products are made. For example, West said, CIRM's performance indicates that it does not fully understand that development leads directly to cures -- not research.

West said that if the high tech industry had to rely on CIRM-type funding years ago, laptops and iPads would still be in the lab instead of the marketplace.

The business industry representatives said that creation of CIRM has been beneficial for stem cell  research, but cited a number of deficiencies in connection with industry applications.

In some ways, their comments echoed past remarks by several CIRM board members, who have expressed concern about the lack of funding for industry, as well as those of the agency's own external review panel. One issue raised by those CIRM directors has been the lack of grant reviewers with product development and industry expertise.

At yesterday's hearing, Gabriel Nistor, vice president of research and development at California Stem Cell in Irvine, said, it is "exceedingly rare to find academics (grant reviewers) that understand the complexities" involving industry. Nistor said his firm has applied for a "few" CIRM grants. None have been awarded.

Also speaking was Allan Robins, CEO of Viacyte in San Diego, who said his firm has done well with CIRM funding. It has received $26.2 million, nearly all of it in the form of a loan. But he said companies develop products – not academia.

Strategy at CIRM: New Sources of Cash, More Funding Transparency, Better PR?

The California stem cell agency is huddling with industry, scientists and public as it wades through a revision of its strategic plan to determine how to spend its remaining $1.4 billion before the cash runs out.

CIRM officials have held at least 10 meetings with a variety of groups, including three public sessions. The next public hearing is Thursday in Los Angeles at the CIRM board meeting.

The revision comes as the agency wrestles with the increasing need to generate results that will resonate with California voters. CIRM's original $3 billion, which consists of cash borrowed by the state, will run out in roughly 2017. The agency is considering mounting a ballot campaign for another multibillion dollar bond measure. The agency is also under examination by the prestiguous Institute of Medicine and is likely to hear recommendations for changes from that report next fall.

Ellen Feigal, senior vice president for research and development, summarized stakeholder comments so far on CIRM's plans in a 13-page documment prepared for the meeting at Cedars-Sinai. She identified several key themes from stakeholders, including the need to find "alternate funding resources," presumably non-public financing. Feigal also cited a need to make the grant funding process more transparent, apparently reflecting complaints from industry. But she noted that stakeholders have said the agency has made "great initial progress" in its first seven years.

Here are four of the five themes Feigal identified. The fifth dealt mentioned CIRM's progress.

• "CIRM needs to become more aggressive in finding alternate funding resources and to implement greater creativity in identifying the types of organizations that may be able to contribute to the sustainability of CIRM's work"
• "Robust public affairs tactics are necessary, and CIRM needs to better communicate the organizational initiatives, as well as educate the public more broadly."
• "Greater transparency in the funding process is needed, and there is a great need for the process to be less bureaucratic and easier to navigate."
• "CIRM needs to provide greater opportunities for networking and breed collaborative projects that unite academic and industry as well as researchers across geographic reasons."

Feigal also mentioned a number of recommendations from industry, which has been less than happy with its meager share of CIRM funding. The suggestions included creation of "communications bridges" and better communication of the funding process. Also recommended was a "split review process – (academic vs. industry)" and a faster approval process that takes into account the high "burn rate" of cash at biotech companies. Another industry suggestion was creation of an "in-house champion" to help businesses navigate the CIRM funding process.

Feigal will come back to the board in January with a draft revision. It is scheduled to be approved March 21. The final plan will be shipped off to the IOM panel studying CIRM. It is scheduled to conclude its work next fall.

Interested parties can email their comments on the plan to CIRM (info@cirm.ca.gov) or speak at CIRM board meetings. The specific address for Thursday's meeting can be found on the agenda. A teleconference location is also available at UC San Francisco, where members of public can take part.

Advanced Cell Technology and the California Stem Cell Agency

Over in the Investor Stemcell Forum, participants are engaged in a bit of a fracas concerning whether Advanced Cell Technology of Santa Monica, Ca., has ever failed to receive a CIRM grant.

The trigger for the discussion was a piece on the California Stem Cell Report concerning the selection of a new chair for the $3 billion California stem cell agency.

The June 2 item said, "Bond financier Jonathan Thomas says he would liquidate his holdings in Advanced Cell Technology of Santa Monica, Ca., an unsuccessful applicant for CIRM funding, if he is elected chairman of the California stem cell agency."

For the record, Nature reported on Nov. 29, 2010, that ACT has applied several times for CIRM grants but never was approved. In 2008, the California Stem Cell Report carried an item about how an ACT scientist publicly complained that a financial conflict of interest played a role in one grant denial.

The California stem cell agency refuses to disclose the names of rejected applicants. The winning applicants are only identified by CIRM after the board acts on their applications.

CIRM Schedules Action on New Directions for May

Directors of the California stem cell agency last week curtailed discussion of recommendations for changes in the agency's direction, including stronger ties with the biotech industry, putting off the matters until their May meeting.

At last Thursday's meeting, CIRM President Alan Trounson quickly ran through his agency's response to the proposals last fall from a blue-ribbon panel commissioned by the agency. But other matters, including selection of a new chair, occupied the board's time.

CIRM's staff response to the commission did not contain specific implementation plans and was vague on some of the matters.

Art Torres, co-vice chair of the CIRM board, told directors that he would like to see directors vote specifically on the staff proposals regarding CIRM's international leadership role, improvement of communications and PR and movement away from traditional funding models (responses 3, 5 and 7 in the CIRM memo).

Director Jeff Sheehy, a communications manager at UC San Francisco, asked the CIRM staff to provide in May a "clear implementation path" for its proposals, including specific actions that the staff would like the board to take.

The recommendations will affect how CIRM allocates its remaining cash, including support for basic research versus grants and loans for efforts more focused on producing clinical therapies. The proposals could mean putting more cash behind research before the results have been "written up," in Trounson's words. The staff recommendations also could mean more cash for biotech firms, including grant rounds that would be limited to business applicants.

Commenting on involvement of biotech companies with CIRM, Trounson said,

"Companies sometimes don't know we are in this space. They all don't read our web site avidly."

He added,

"Clearly we're not meeting their needs."

Escape Therapeutics: The Latest Business to Win a CIRM Grant

A firm founded by a part-time, but award-winning poet was the only company to receive a grant in last week's round from the $3 billion California stem cell agency.

The firm is Escape Therapeutics of Palo Alto, Ca. The principal investigator on the $1.5 million CIRM grant is Basil Hantash(see photo), founder of the firm and an Illinois native who held a biodesign fellowship in 2006-07 at Stanford.

Only one other company filed an application in the $25 million immunology round, originally budgeted for $30 million. That firm's name was withheld by CIRM, which is their general policy concerning unsuccessful applicants.

CIRM reviewers gave Hantash's application a 72 score. The review summary cited some weakneses in the application, but said it was “worthwhile and achievable.”  In the words of the reviewers, the research was “well designed, logical and an interesting approach to pursue.”

Founded in 2006, Escape does not have a Web site. But, according to a company document provided by Hantash, Escape is an early stage, privately held biotech firm “focused on accelerating the commercial availability of allogeneic stem cell therapies by solving the key translational hurdle preventing their clinical utility – immune mismatch and subsequent donor rejection.”

The information continued,

"Invented by Escape’s founder Dr. Hantash while at Stanford University, the company’s platform technology represents a significant potential breakthrough that can revolutionize the treatment of blood-borne disorders such as leukemia, type I diabetes, and autoimmune diseases. Escape’s innovative technology allows for the creation of the world’s first allogeneic, 'off-the-shelf' therapy capable of being used in any patient irrespective of their HLA profile."

In addition to the last week's grant, searches on the Web showed that Escape has other ties to CIRM. It is one of four internship sites for a CIRM training program run by San Jose State University. Asked for comment, Hantash said,

"Escape focuses the training process on translational stem cell research skills, rather than pure academic basic science research. Our interns were the first to publish out of all the interns in the program, so we feel they gain commercialization experience while retaining the rigor of academics. This is a marriage of a Stanford-like focus on entrepreneurship and an industry eye on developing life-saving products to alleviate patient suffering."

Hantash was a partner from 2007 to 2009 at Proteus Venture Partners, a San Francisco Bay Area investment and advisory firm focusing on regenerative medicine. Proteus was heavily involved in CIRM proceedings concerning the agency's $500 million biotech loan effort. Hantash said his responsibilities included fund-raising and deal sourcing and evaluation.

A number of references on the Internet refer to Hantash as an award-winning poet. We asked him to provide a sample of his work. It can be found here.

(Photo of Hantash from Proteus web site)

Top 10 Tips for Snagging Cash from CIRM

For businesses seeking clues about how to win cash from the $3 billion California stem cell agency, a UC Davis researcher is offering 10 free tips.

We took a look today at the advice offered up by Paul Knoepfler on his blog. It all makes good sense to us. But what do know? We have never received a grant from CIRM. Knoepfler has.

Here are a couple of his suggestions.

No. 3 –

“Read the RFA very carefully. Perhaps even read it 5 times. It may seem straightforward, but think about the key words being emphasized by the funding agency.”

No. 6 –

“Hire professional grant writers with experience in industry and academia. This is an investment well-spent.”

We also have a couple of our own.

Attend meetings of the CIRM board of directors, particularly those dealing with grant approval. Nothing else will inform you as well concerning the board's thinking on grants. You will also have to a chance to meet some of the very sharp people who control the purse strings.

Read all of the extraordinary petitions filed by rejected grant applicants. Read at least 50 or more of the summaries of reviewers' comments on applications, splitting the material between top-ranked grants and ones that did not make the grade.

Good luck!
 

Tracking CIRM Grants: "Thin Ice" Lurking?

Directors of the California stem cell agency today approved a $15.7 million operating budget for next fiscal year – 28 percent higher than this year's spending – and requested a report from its staff concerning its critical grants management system.

The report was sought after CIRM Director Michael Friedman, CEO of the City of Hope, said he wanted to “express in the strongest possible terms my discomfort” with the decision by CIRM staff to build a custom grants management system.

He said that “unless you are prepared to spend enormous amounts of money, you are stepping on some very thin ice.”

“Everybody has seen horrible examples of custom-designed system that go bad.”

Friedman asked if any subcommittee of directors had approved the decision to go forward with a custom system. The answer was no, but that the decision had been carefully considered by CIRM staff.

At that point in the meeting, we lost the Internet connection to the CIRM audiocast. By the time it was restored , the budget discussion had concluded with approval of the spending plan. Don Gibbons, chief communicastions officer for CIRM, told us by email that the report had been requested. (We will revisit the budget discussion after the agency posts a transcript of the meeting.)

On Monday, when we reported some of the details of the budget, we noted that spending on information technology is scheduled to jump 53 percent from $817,000 to $1.2 million, an increase of about $433,000. Most of that goes for the grant system.

CIRM is trying to oversee more than $1 billion in grants to more than 300 recipients and, at the same time, hand out many hundreds of millions more in the next year or so. It is building custom programs for entire process, from applications to oversight. Currently, CIRM has a $125,000 RFP out for “systems analysis and software development services” and hopes to have a company on board next month.

The board also discussed the strategic financing report(see here and here), which will be wrapped into an external review of CIRM's strategic plan next fall. There appeared to be no clear consensus at this point whether the agency should make grants as speedily as possible or husband its resources to deal with unexpected opportunities in the fast-moving stem cell field. Related to that was a discussion of the CIRM grant portfolio. No action was needed on either item.

Comments by John M. Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., were discussed briefly after they were read into the record. Simpson said he was “troubled” by what appears to be a lack of a level playing field for grant applicants from business and the dominance of academic institutions, who constitute a plurality on  the board.

CIRM Chairman Robert Klein said he did not think that the biotech industry agreed with Simpson's concerns about whether business grant applications were being treated fairly. Klein noted that BIO, a national biotech industry group, recently recognized him with a national award, indicating that the group valued CIRM's contributions. But Klein said more progress was needed.

Vice Chairman Art Torres indicated that he took Simpson's concerns about the seriously but said the public does not understand just how stringent are the conflict of interest standards at the agency.

Directors also approved the a concept proposal for a $45 million round of grants for basic biology research.

You can find slides from the report by CIRM President Alan Trounson here. He discussed recent stem cell research, a proposal for a CIRM online journal and upcoming CIRM workshops. The slides also include those used for the budget presentation.

'Troubling' Trend: Is CIRM Playing Field Level for Business?

A longtime observer of California stem cell matters today said he is troubled by a trend at CIRM that appears to give short shrift to research at biotech businesses in the Golden State.

John M. Simpson has been watching the California stem cell agency since late 2005, along with participating in its affairs, most notably development of its IP policies.

Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., prepared this statement to be read at today's CIRM board meeting in San Diego. Simpson is on the East Coast on other business and may not be able to reach the Washington, D.C., teleconference location to deliver his remarks personally. Here is the full text.

“I apologize that that I was unable to attend today's ICOC meeting. I
appreciate this statement being read into the record on my behalf.

“When Consumer Watchdog began its Stem Cell Project almost five years ago, I
naïvely expressed concerns that the program would be hijacked by the biotech
industry. That has -- at least so far -- not happened; rather, it has been
dominated by academic research institutions, whose representatives hold the
largest number of seats on the board.

“I believe the trend is troubling enough to ask whether the playing field is
level for all applicants. I believe there are grounds for concern.

“Here are some suggestions to improve the situation:

“-- A task force should be convened to consider why companies have fared so
poorly and what should be done. All sessions must be public.

“-- A workshop should be scheduled with interested companies to discuss ways
to improve their applications. It must be opened to the public.

“-- An effort should be made to recruit scientific reviewers with substantial
experience in research programs conducted by businesses.

“-- CIRM meetings that currently include only grantees should be expanded to
include all legitimately interested parties. Currently you have an annual
conference for all grantees. This must be opened to include all grant and
loan applicants, even if they were unsuccessful. If there is a concern
about expenses, unsuccessful applicants could be charged a modest fee. What
better venue to learn what makes a successful application than a conference
that includes CIRM's awardees? It would also create opportunities for
developing collaborations. Currently CIRM continues to suffer from the image
that it is a closed club. Opening conferences to all applicants -- and even
other interested parties -- would help correct that.

“Thank you for your consideration.

“John M. Simpson”

Business Snags $5.3 Million from CIRM

IRVINE, Ca. -- Six California companies snapped up $5.3 million last week in grants from the California stem cell agency, marking the first major industry funding from the $3 billion state research enterprise.

Up until the latest round of grants, only one company, Novocell Inc. of San Diego, had won a grant and that was for only $50,000.

However, the CIRM board did not approve business applications at the same rate as those from the nonprofit sector. Only one out of seven business proposals (41 in all) won approval last week compared to one out five nonprofit pitches(77 in all).

(The board put off action until next month on some grants so the figures could change when final action is taken.)

The six companies snagged about 26 percent of the nearly $20 million in grants for developing research tools and technology. The six also represented about 26 percent of the 23 grants that were approved.

CIRM President Alan Trounson said,

"These awards represent the entry of the biotechnology industry into CIRM-funded initiatives to accelerate progress."

Nonetheless, other companies appeared at the CIRM board meeting here to complain about the fairness of the review process, which they said was tilted towards academia. One company, DNAmicroarray Inc. of San Diego, suggested changes in definitions for "principal investigator" on grant applications that would reflect differences between business and the nonprofit sector.

Here are the companies and their awards:

VistaGen Therapeutics of South San Francisco, $971,558, PI Kristina Bonham; Fluidigm Corp. also of South San Francisco, $749, 520, PI Marc Unger; Gamma Medica-Ideas of Northridge, Ca., $949,748, PI Douglas Jay Wagenaar; Novocell Inc.of San Diego, $827,072, PI Evert Johan Kroon; Invitrogen of Carlsbad, $869,262, PI Ying Liu, and Vala Sciences of San Diego, $906,629, PI Patrick McDonough.

As of this morning, only one of the companies had generated a press releases about its CIRM grant, while at least some of the academic grant recipients were online as early as Wednesday with their good news. The release by Vala said, among other things, that its grant will be executed in close collaboration with laboratories at the Burnham Institute for Medical Research led by Vincent Chen and Mark Mercola.

Last week's meeting also marked the first time that CIRM directors allowed "extraordinary petitions" to challenge negative decisions on applications by the Grants Working Group. Three were received in time to be considered. Three others were also received but not by the deadline for consideration by CIRM staff and the board. The deadline falls five working days before the board meeting..

In each of the three cases, CIRM President Trounson said he could not find "compelling evidence" to change the score of the application or the decision of the working group. The full board can bring up petitions for public discussion but did not choose to do so.

Two petitions were filed by private businesses, International Stem Cell Corp. of Oceanside and DNAmicroarray Inc. of San Diego and one by the Salk Institute of La Jolla. Here are links to the petitions: International Stem Cell (filed by Jeffrey Janus, president, and William Adams, CFO), DNAmicroarray (filed by Babak Esmaeli-Azad, president) and Salk (filed by Juan Carlos Izpisua Belmonte, professor, Gene Expression Laboratory).

Adams also appeared before the CIRM board, citing "fundamental problems" involving the way business applications were treated. Some members of the board have expressed sympathy with the view that there is a tilt towards academia in the review process. CIRM is attempting to find more grant reviewers with a business background.

Reporter Terri Somers of the San Diego Union-Tribune wrote a story on the business grants. Bruce Bigelow of Xconomy.com also had a brief item, declaring that CIRM had "opened its spigot for funding business ventures."