Massive, $243 Million Disease Round Gets Okay from Stem Cell Agency

Directors of the California stem cell agency today gave the go ahead to a $243 million disease team grant round aimed at generating a “development candidate” for a clinical trial, doubling the size of the original proposal by the CIRM staff.

The huge round would fund up to 30 planning grants and 12 full grants of up to $20 million. It would come on top of the initial disease team round of $250 million last October. The application process for the latest round would begin this November with planning grants, which are required to be eligible for full grants. Full grants are scheduled to be approved in 2012.


The size of today's round was doubled at the suggestion of CIRM Director Jeff Sheehy. He said most of the disease team efforts are risky and expected to fail. He said it was important to get more in the pipeline.

Sheehy first proposed 45 planning grants and 15 full grants. CIRM President Alan Trounson resisted the increase in the number of grants, declaring it would overtax staff and reviewers. After some discussion, Sheehy agreed to 30 planning grants and 12 full grants.

The board also approved a more than $600,000 study of its operations by the prestigous Institute of Medicine that would be expected to completed by the general election of November 2012. Chairman Robert Klein said the study would be key to winning voter approval of more billions in state bonds to fund stem cell research.

Sheehy supported the proposal, declaring it would be taken “very seriously” by editorial boards and other segments of the media as well as the public.

Duane Roth, co-vice chairman of the stem cell board, dissented. He said the study will require considerable work on the part of staff. He also said the board should not have “blind trust” that the findings would be ones desired by the board.

The study will be funded with part of the $3.5 million that CIRM has in private donor funds. The cost could increase beyond the $600,000 range because CIRM directors indicated they wanted some changes in the scope of the study. CIRM is currently involved in an expensive external review of its strategic plan and will be subject to a performance audit($400,000 or so), which it will also pay for, under the terms of legislation expected to be signed into law.

The board also approved paying its patient advocate members up to $15,000 annually. That action came during a session late yesterday, which CIRM had assured us would be solely an executive session.

In other actions, the board approved procedures for selection of a new chair and vice chairman. Klein has said he will step down as chairman in December. However, if the board does not vote on a replacement, he will continue in office.

Francisco Prieto, a Sacramento physician, was named chairman of the directors' Evaluation Subcommittee, and Ted Love, executive vice president of Onyx Pharmaceuticals, Inc., of Richmond, Ca. , was named vice chairman. The panel evaluates the performance of the chairman, vice chairman and president of the agency.

Here is a link to the CIRM press release on the meeting.

Some Question CIRM Grant Oversight as Excessive

The California stem cell agency is receiving “mixed reviews” for its oversight of its research grants, which now total $1 billion, according to an article today in The Scientist magazine.

Commonly governmental agencies are chastised for failing to ensure that taxpayer funds are spent effectively. In this case, the stem cell agency is being faulted -- by some -- for being too tough.

The case in point is the termination -- first reported by the California Stem Cell Report -- of three out of more than 300 grants. The amounts are tiny compared to the $3 billion that CIRM expects to give away, accounting for only $1.8 million in a $46 million round approved in 2007.

The Scientist article by Jef Akst said,

“Clearly, funding agencies need to offer some oversight of grants to avoid misuse of funds. But can there be too much of a good thing? “

She continued,

“There are mixed reviews among the scientific community about whether CIRM's close watch of their grantees is a good thing. To some, it is an important practice for public funding agencies such as CIRM to show the taxpayers that their money is going towards productive and fruitful research. 'I think the oversight is outstanding,' said John Simpson, the stem cell project director at the advocacy group Consumer Watchdog in California. 'It shows that they're not asleep at the switch. CIRM is functioning as both a grant making agency [and] also something of a steward of the funds it hands out.'

“But others say this kind of intense supervision can burden investigators -- and the science itself. 'In theory, it's a terrific thing,' agreed David Kaplan of Case Western Reserve University in Ohio, who has written about the peer review system at NIH. "To have the granting agency being involved enough to be helpful to their grantees, I think that is a terrific idea. The problem with that kind of a system is that you can be too intrusive. That eliminates that kind of serendipity [in scientific discovery].'“

Akst wrote that CIRM's “short timeline” may lie behind its grant monitoring, which is more rigorous than performed by the NIH.

She said,

“While the NIH will exist for many years to come, CIRM has a 10-year lifespan, as approved by California voters in 2004. 'CIRM has very defined goals,' said the Burnham Institute for Medical Research's Huei-Sheng Vincent Chen, another SEED grant recipient. '[They] wanted something within 10 years so they have to be more aggressive.'"

The Scientist magazine also chose to publish the names of the scientists whose grants were terminated. Their names are by law public record. Only one of the three scientists spoke with Akst, John Cooke of Stanford.

Akst's story said,

"'I anticipated that they would be happy with that [new] proposal,' Cooke recalled. 'But] they weren't happy.' In January 2009, after a second, more detailed progress report, follow up phone discussions, and a petition for reconsideration from Cooke, CIRM revoked his second year of funding -- nearly half of what he had originally been awarded -- citing the new directions his research had taken.

'I can understand their reasoning,' Cooke said. 'I just wish I had understood that that applied to the SEED grants.'"

Last month, CIRM approved $230 million for 14 grants up to $20 million each that appear to require even more rigorous oversight than earlier rounds. Some CIRM directors said publicly that they expect to see some of the latest grants terminated early because they will fail to meet the required benchmarks.

You can find a list here of all the items published on the California Stem Cell Report concerning the terminated grants. They include comments from the other two scientists, who we have chosen not to identify for previously discussed reasons.

A Look at Tucson's Calimmune and $20 Milllion

The global headquarters of Calimmune, Inc., which shares in a $20 million grant from the California stem cell agency, stands on one of the more unlovely thoroughfares in Arizona.

The three-year-old firm is only a short walk on East Broadway in Tucson from O'Reilly Chevrolet and a Burger King. While Calimmune's address may not electrify folks on Wall Street, it has a pedigree that it is hard to quibble with.

By one account, Calimmune was founded by David Baltimore (see photo), a former member of the board of directors of the $3 billion California stem cell agency. Baltimore also is a Nobel Prize winner and former president of Caltech. Other accounts state that Irvin Chen, director of the UCLA AIDS Institute, was a co-founder.

Late last month, California's stem cell agency approved a $20 million grant to Chen and Geoff Symonds, chief scientific officer of Calimmune, a little-known company with no Web site but a laboratory in Australia, lab space in Pasadena, Ca., and more facilities soon to come at UCLA.

CIRM said the grant was aimed at generating an FDA application in four years for a clinical trial “to treat HIV/AIDS using an RNA interference approach to modify the patient’s blood-forming stem cells. When transplanted back, those cells will produce T cells that are resistant to HIV infection.”

The proposal echoes Calimmune goals articulated earlier on the Web site of Grayhawk Capital, a private equity investment company in Phoenix, Az., that has cash in Calimunne. Some initial research involving Symonds and UCLA was published last February with partial funding from Johnson & Johnson in Australia.

In response to email queries, Calimmune's CEO, Louis Breton, told the California Stem Cell Report that Symonds will perform his CIRM-funded work in California. He said the closely held firm is aware that CIRM is barred from funding out-of-state grants. Breton did not respond to questions about the number of Calimmune employees and their locations, although he said he anticipated more hiring for the CIRM grant. He said the Tucson location houses a small administrative staff. The company is incorporated in Delaware.

As for Calimmune's funding, we asked Breton whether any originated with Johnson & Johnson. Until the last year or so, Symonds was senior research director at Johnson & Johnson Research Pty Ltd. in Sydney, Australia, where the Calimmune lab is located. According to one report earlier this year, he holds more than $10,000 in Johnson & Johnson stock. At least one of the other Calimmune scientists in Australia worked as well for Johnson & Johnson until February. Breton, however, said none of the company's funding originated with Johnson & Johnson. Grayhawk did not respond our email query.

A Johnson & Johnson company document said in 2008 that the purpose of the Johnson & Johnson research operation involving Symonds was “to identify new medical discoveries in Australia and facilitate their commercial development into new products for Johnson & Johnson.”

CIRM reviewers were enthusiastic about Chen and Symonds disease team project. A CIRM summary of the application said,

“Reviewers stated that the resources and investigators are outstanding and the team is superb, both scientifically and in therapy development. The Disease Team comprises a collaboration between two complementary groups, one academic and one corporate. Each brings unique expertise to the project, with the academic group providing scientific know-how and proof of concept and the corporate group providing expertise in biologics development and commercialization. The team leaders are accomplished, highly productive investigators with a demonstrated track record in the field of HIV research, gene therapy, and/or clinical drug development. Key members of this team made the initial scientific observations leading to their hypothesis and demonstrated proof of concept in tissue culture and relevant models. A subset of the team has direct experience with a gene therapy trial in humans.”

Torres Hails CIRM Innovation, Leadership

The Sacramento Bee last week carried an op-ed piece by Art Torres, co-vice chairman of the $3 billion California stem cell agency, touting the virtues of CIRM, its innovation and the wisdom of the California electorate.

Torres, a former state legislator and former head of the state Democratic party, said,

"(The) drive to innovate is what led voters to create the California Institute for Regenerative Medicine and its charter to invest in stem cell research. The goal was clear: Keep California, its universities and biotech industry on the forefront of this most promising area of innovation in health care."

Torres focused particularly on CIRM's ambitious, $230 million disease team grant and loan effort, the largest research round in the agency's history.

Torress said,

"There are no other funding organizations in the country that are able to make this kind of investment in stem cell innovation."

He continued,

"We don't yet know what researchers will discover. But we do know that, whatever they discover, this new approach to science means we will be able to turn it into viable treatments for people much, much faster than ever before. That will move stem cells from the promise of new therapies to delivering on that promise for the people of California.

"And that's exactly what the voters wanted when they created CIRM: for it to reflect the innovative leadership that is this state."

Torres" piece drew only three comments online from readers. All were negative.

Nature on Disease Team Round: The Race is On

Nature magazine has published another piece on the California stem cell agency's ambitious, $230 million disease team round, calling it the “starting gun” to confirm the promise of stem cells.

The Nov. 2, 2009, story by Erika Check Hayden said that some researchers around the country say the grants and loans will benefit the field as a whole. She also carried a comment from the former chairman of the CIRM grants review group, Stuart Orkin. Orkin resigned his post last November and did not participate in the review of the disease team grants.

Hayden wrote,

“Other researchers have welcomed the awards, but note that many of the projects test ideas that are similar to work being funded elsewhere.

"'The general [new-grant] portfolio strikes me as being similar to what is going on elsewhere,'" says haematologist Stuart Orkin of the Children's Hospital Boston in Massachusetts. 'I don't see anything radically different from what I see people thinking about in other institutions, but it's great to have the funding to do it.'

“For instance, two of the grants will fund work to develop monoclonal antibodies — targeted biological drugs that are already approved for many indications — to target cancer cells. Another grant will try to use a patient's own cardiac stem cells to repair damage from heart attacks, a controversial approach that is already being tested in patients. A fourth grant aims to modify patients' bone-marrow cells to correct the genetic defect that causes sickle-cell anaemia, then implant the cells back into patients.

“A similar approach has been used to treat severe combined immunodeficiency disorder. 'That would have been called gene therapy before, instead of stem-cell therapy, and there are a number of people doing that,' Orkin points out.”

The magazine also carried an item last week on its blog.

Don Gibbons, chief communications officer for CIRM, has pointed out that the grants received more coverage than we reported last week. We found another story in a local paper in Los Angeles, the Daily News, and one on a Los Angeles radio station, KPCC. The Daily News story was reprinted in the Contra Costa Times. Other stories appeared elsewhere as well.

In our reporting on news coverage of CIRM events, we rely on Internet search engines, which are not perfect and sometimes slow. Plus we do not necessarily mention every news report in our items, just the ones of interest with higher impact or interesting reporting or commentary.

CIRM has a standing invitation to comment on any subject, including accounts of CIRM news coverage, on the California Stem Cell Report. We have told the agency on more than one occasion we will carry their commentary verbatim, a practice that is not found in the mainstream media.

A $230 Million California Stem Cell Web

The publicity last week from recipients of $230 million from the California stem cell agency portrays an impressive web of scientists in the Golden State and beyond.

The list below began as a simple update of an earlier item with links to news releases from the beneficiaries of CIRM largess, in this case the agency's largest ever research round. But, as we gathered the information, what became abundantly clear are the significant financial and scientific ties between institutions that might seem to be rivals under other circumstances.

No doubt they continue to compete in other areas and will be competitors in the future for grants, talent and more. But in this case researchers put together powerful teams that won tens of millions of dollars for themselves and their institutions.

The releases from the institutions contain more information about the researchers and their projects than is contained in CIRM's press release on the disease team grants. But CIRM also provides separately summaries of the scientific reviews of the applications, which carry analysis, criticism and praise of the proposals.

Here is the latest list of news releases issued by the institutions and businesses.

Beckman Institute, shares $15 million with City of Hope and USC

Burnham Institute, no news release available, shares $19 million with UC San Francisco and Ludwig Institute

Calimmune, Inc., of Tucson, Az, no news release available, shares $20 million with UCLA

Cedars of Sinai Medical Center, $6 million

Children's Hospital, Los Angeles, no news release available, shares $9 million with UCLA

City of Hope, $18 million and shares $15 million with USC and Beckman Institute

Ludwig Institute for Cancer Research, no news release available, shares $19 million with UC San Francisco and Burnham, $16 million with Salk and UC San Diego

Novocell, shares $20 million with UC San Francisco

Salk Institute. shares $16 million with UC San Diego and Ludwig Institute

Sangamo Biosciences, Inc., of Richmond, Ca., shares $15 million with City of Hope

Stanford, $32 million, and shares $20 million with UCLA and USC, $20 million with UCLA

UCLA, shares $20 million with Calimmune, Inc., of Tucson, Az.; $9 million with Children's Hospital, Los Angeles; $20 million with Stanford and USC; $20 million with Stanford

UC San Diego, $20 million , shares $16 million with Salk and Ludwig

UC San Francisco, shares $39 million with Ludwig Institute, Novocell and Burnham

UC Santa Barbara, shares $16 million with USC

The international partners listed in the CIRM news release are the Medical Research Council of the United Kingdom($8 million via the Weatherall Institute of Molecular Medicine, Oxford University, no news release available from Weatherall); the University Health Network ($35 million)of Toronto, Canada.

Here is a link to CIRM's disesease team press package, including a video of the lengthy news conference. Only one reporter from a major publication was present at the news conference, Andy Pollack of the New York Times. No television stations sent crews.

(Editor's note: The earlier item that we posted concerning the institutional press releases has vanished from this Web site for reasons probably only fully understood by Google, which provides the blogging service that we use. Also, an earlier version of this item incorrectly said Pollack was the only reporter present at the news conference. CIRM reports that two other reporters from local outlets were on the scene.)

Blogger Talks to Novocell About First CIRM Loan

Little information was dispensed yesterday by the California stem cell agency about the first step in what is proposed to be a $500 million loan program for the biotech industry.

But a biopharmaceutical industry blogger provided some information about the $20 million loan to Novocell, Inc., a San Diego stem cell engineering company with an emphasis on diabetes therapies. It is the first beneficiary of the loan program.

CIRM directors approved the loan to help develop a novel cellular therapy for diabetes. The disease team effort includes a $2.8 million Novocell contract with Jeff Bluestone of UC San Francisco.

Alex Lash of the In Vivo blog talked to Novocell CEO John West. Kash wrote,

“West...says the cash infusion from 'the stem-cell experts' was a validation of the firm's work and puts it in a 'good position' to look for its next round of venture funding.

“There are some minor details to work out first, though. West says Novocell hasn't yet received a loan document from CIRM and isn't exactly sure about the terms. Based on the loan program's guidelines, West is aiming for 10% warrant coverage and a payback period closer to 10 years, the far end of the range. 'We have a good feeling we'll work it out,' said West.

“CIRM loans will certainly have more generous terms than typical bank loans, and the agency has said it doesn't expect many of them to be paid back. West said he was surprised that Novocell was the only for-profit to lead a disease team application. But he noted that not many of the state's stem-cell related firms were far enough along to push a program into the clinic within four years, one of the top criteria of the agency's reviewers.”

(Editor's note: An earlier version of this item misspelled Alex Lash's last name as Kash.)

A Peek at News Coverage of CIRM's $230 Million Disease Team Round

California's stem cell research effort today climbed over the $1 billion mark with its whopping disease team round. The awards began generating news coverage internationally this afternoon, and more stories will surface later today and tomorrow.

Erika Check Hayden filed a report on Nature magazine's breaking news blog. She said CIRM regards the round as the “crown jewel of its portfolio.” She said that some of the grants will go “for therapies that, in some cases, are unlike any ever before approved by the FDA.”

Hayden wrote,

“Only a handful will employ human embryonic stem cells, despite the fact that most of the fanfare surrounding the passage of Proposition 71, the ballot measure that created CIRM, concerned the fact that CIRM would fill the gap left by a lack of federal funding for work on these cells. But Bob Klein, architect of Proposition 71 and chair of CIRM's governing board, said, 'Our commitment to the voters was that we would pursue the very best cell type for each disease based on the scientific and clinical evidence.'"

Rob Waters of Bloomberg emphasized the business aspects and had a separate piece on Sangamo Biosciences of Richmond, Ca., a publicly traded company that shared in a $14.6 million award with City of Hope in Duarte, Ca.

Oddly, the largest newspaper in California, the Los Angeles Times, had not carried a word as of this writing on the roughly $80 million in grants to institutions in the Los Angeles area.

The New York Times may well have story late today or tomorrow. Its Los Angeles-based reporter, Andy Pollack, could be seen on the Webcast of the news conference, asking a question about the slim use of human embryonic stem cells in the disease team grants.

Here are links to other stories:
Thomas Kupper of San Diego Union-Tribune
San Diego News Network
Steven Brown of the San Francisco Business Times
DelMar Times

California Stem Cell Agency Approves $230 Million Aimed at Clinical Trials

The California stem cell agency today formally awarded $230 million to 14 teams of scientists in the largest and most ambitious round of research grants in CIRM history.

Already the world's largest source of funding for human embryonic stem cell research, the $3 billion agency said the grants and loans would lead to the beginning stage of clinical trials in four years.

The disease team round also marks the first foray into what is expected to be a risky, $500 million loan program for the biotech industry. The round is additionally a critical step in building support for continued funding of the agency, which will lose the ability to finance itself sometime in the next decade.

The goal of the disease team effort is to generate filings to begin a clinical trial within four years or less. That would presumably lead to creation of therapies that could alleviate the suffering of thousands. CIRM could also use the results to ask the legislature or the people of California, by ballot measure, for additional funding.

The disease team round is the first major effort involving international partners, Canada and the United Kingdom. Organizations in those countries are collaborating with California partners and adding many more millions to the research largess.

All of the grants in tier one were approved, although application 1471 had conditions attached because of a change in the employment of a co-PI in the United Kingdom.

Weissman's $20 Million Proposal Dodges Rejection

A $20 million grant application from reknown scientist Irv Weissman of Stanford tonight avoided disaster as CIRM directors overturned a decision by scientific reviewers to reject the proposal.

The application was moved, 14-2 vote with two directors abstaining, into the top tier of disease team grants that are headed for approval by the directors tomorrow morning.

Another $20 million application from Stanford's Gary Steinberg was also moved into the first tier on a separate vote, which was either 13-3 or 12-4. One director's vote was inaudible on the Web audiocast.

The Steinberg and Weissman applications bring to 13 the number of grants in the first tier for a total of $207 million. That is just under the $210 million budgeted for the disease team effort, the largest research grant round in CIRM history.

Both applications were the subject of an “extraordinary petition,” along with four other applications. One of those efforts was not successful tonight. No director made a motion to move a $12 million proposal by Aileen Anderson of UC Irvine to the first tier.

(Weissman's petition can be found here, Steinberg's here, Anderson's here. The other petitions are from Judith Shizuru of Stanford(here), Karen S. Aboody of the City of Hope(here) in Duarte, Ca., and Xianmin Zeng of the Buck Institute(here) in Novato, a town north of of San Francisco.)

The directors have recessed until tomorrow morning. They did not take up the other petitions tonight as they worked their way through the grants that CIRM's grant reviewers said were not worthy of funding. Weissman's application received a scientific score of 65, below the cutoff line of 70. Steinberg's and Anderson's scores were not available.

Regarding the Weissman application, CIRM Chairman Robert Klein said some of the reviewers may have been less than objective because they do not believe that cancer stem cells exist. The subject is a matter of some scientific dispute. CIRM President Alan Trounson disagreed with Klein on the possibility of prejudice but said that the grant could be worthy of funding.

Director Ted Love, who served as CIRM's chief scientific officer during the review, said the board could feel comfortable funding the grant or not. He said he did not think it would be “unwise” to fund the application.

Weissman's name was not mentioned during the discussion, but some commented about respect for the principal investigator. The United Kingdom is also involved in the grant, providing an additional $4.3 million, according to Trounson.

The board is scheduled to resume deliberations at 8:30 a.m. PDT tomorrow in Los Angeles. CIRM has scheduled an 11 a.m. news conference to formally announce the grant winners. The meeting will be audiocast on the Web. Directions for listening are on the agenda.

CIRM Board Recesses for Confidential Grant Review

Directors of the California stem cell agency have gone into executive session to discuss confidential information related to applications for $167 million grants and loans in the agency's disease team round.

The CIRM board moved into closed door discussions tonight shortly after the CIRM staff presented a brief overview of the round. It is not clear when the board will return to open session.

The agency has called a news conference for 11 a.m. PDT tomorrow to formally announce the awards and publicly identify the winners.

CIRM Hopes for Big Media Splash on Disease Team Grants

The California stem cell agency today began trumpeting this week's disease team grants to the mainstream media, proclaiming that it means $200 million for researchers in California, the United Kingdom and Canada.

CIRM issued an advisory to news outlets, presumably globally, that a news conference will held at 11 a.m. PDT on Wednesday at the Luxe Hotel on Sunset Boulevard in Los Angeles. Six winning scientists will be available to answer questions, CIRM said, although the awards have not yet been approved by the CIRM board.

That, obviously, is a technicality. Grant reviewers have already made the de facto decisions, approving 11. Legally, however, the CIRM board has final say. It begins a two-day meeting at the Luxe tomorrow.

CIRM has promised the appearance of six government officials, including one each from the UK and Canada. Also on hand will be patients living with diseases targeted by the awards. Those are the folks who are going to be the selling point for TV coverage. They are much more sympathetic and appealing than say, for example, Herb Schultz, a senior adviser to the California governor and one of the six government officials who will be on the scene.

For those of you unfamiliar with PR drum-beating, the CIRM news advisory is the easiest part of the process. Phone calls will be made along with additional emails. Information specific to various areas will be fed to reporters and editors. Promises about exclusive interviews will be tendered. Whatever it takes. And that is as it should be if CIRM is going to make the most out of what it views as a critical round of grants that may have a lot to do with building support for its continued existence.

CIRM is barred from spending money out of state. Cash for the research in the UK and Canada will come from those countries, but the winning scientists have joined together in teams.

The news conference will be webcast at the following link: http://www.cirm.ca.gov/Disease_Team_Press_Conference

It will not be live until shortly before 11 a.m. Reporters not on the scene will be able to email questions to the news conference.

The Lucky 11 and $167 Million in Stem Cell Research Cash

The California stem cell agency has pinpointed 11 likely winners of grants and loans up to $20 million each in the agency's ambitious disease team round, which was once projected at $210 million.

The awards are scheduled to be formally approved next week by the CIRM board of directors at a two-day meeting in Los Angeles at the Luxe Hotel. CIRM's Grants Working Group decided earlier that 11 proposals merited funding. The CIRM board almost never rejects a recommendation for funding by its reviewers.

The cost of the 11 applications is $167 million, well below the $210 million budgeted for the disease team round. Twenty other proposals were rejected by reviewers who gave them scientific scores of less than 70 on a scale of one to 100. Some patient advocates for the rejected research, which includes projects involving Huntington's Disease and spinal cord injury, are likely to make a pitch at the CIRM board meeting for funding of some of the rejected applications.

The CIRM board has final authority to make the grants, although it is loath to overrule its scientific reviewers.

Names of the recipients are not scheduled to be released until after board action, which could come on Tuesday or Wednesday. However, the public summaries of the reviews generally contain enough information to determine the identity of the winners, if you are well-informed about stem cell research or willing to scratch around on the Internet.

For example, the review summary of the top-ranked application – with a score of 90 for $14.6 million for stem cell therapy for AIDS – said,

“Reviewers noted that the investigators have already successfully navigated many of the regulatory hurdles with the FDA and RAC through previous clinical trials in hematopoietic transplantation in HIV patients.”

Regarding another application that sought $20 million for cell therapy for diabetes, the review summary said,

“The principal investigator (PI) has experience in encapsulation and has led the efforts that resulted in recent publications in top tier journals. The world-renowned immunology collaborator is well published, has experience in translational immunology and clinical trial design, and will lead a group of established immunologists at the collaborating institution.”

The summaries also contain the names of reviewers who were excused from examining the application because of conflicts of interest, both professional and financial, additional information that can help identify winners.

The names of the applicants are not raised during the CIRM board discussion, which is public. The idea is the board members should be blind to the institutions seeking the funds. But some of the board members are well-versed enough in stem cell science to be able to identify applicants without an Internet search.

The earlier de facto decisions, however, are made behind closed doors by scientific reviewers and some CIRM board members. The statements of the economic interests and potential professional conflicts of scientific reviewers are filed with CIRM but are not made public, a practice that has triggered public complaints by a few researchers. Others grumble in private, wary of making their views publicly known because CIRM controls $3 billion in grant money that might not come their way if they are too cranky.

On tap for next week's meeting is discussion of a CIRM survey of its scientific reviewers regarding public disclosure of their financial interests. The results are expected to be negative, and the CIRM board is not likely to go against the wishes of its reviewers. Some CIRM directors fear the loss of reviewers if they are forced to make public their financial interests.

The Little Hoover Commission, the state's good government agency, recommended the survey because of the power of the reviewers over the public purse.

Some of the applications at next week's meeting are expected to involve loans to businesses, the opening foray into what is projected to be a $500 million program. CIRM directors are expected to go along with today's decisions on loan practices by their Finance Subcommittee.

In response to a query, Don Gibbons, CIRM's chief communications officer, said that the subcommittee approved both staff recommendations concerning evaluation of recourse loans and changes in the loan administration policy.

He said the panel also approved the “hybrid recommendation” in its financial review of loan applications. A CIRM document said,

“Under this proposal, CIRM staff would review and evaluate the information provided by CIRM’s delegated underwriter or financial consultant and the Grants Working Group, determine whether an applicant is eligible for a recourse loan or a non-recourse loan, and negotiate any conditions.”

Under certain conditions, however, the staff's determination could be reviewed by the Finance Subcommittee.

CIRM On Track to Hit $1 Billion Mark

The board of directors of the California stem cell agency late this month is expected to approve $210 million for disease team grants and loans, the largest ever research round for the five-year-old enterprise.

The amount will push CIRM's grant total to about $1 billion, the bulk of which has gone to institutions with representatives on its board of directors. The agency has authority to spend another $2 billion, which it generates through California state bonds. When that runs out, the agency will need to find additional funding if it is to continue.

The meeting Oct. 27-28 in Los Angeles will also mark the first ever loans made by the agency, which has plans to build the loan program to $500 million. The purpose of the loans is to assist biotech businesses that could not otherwise receive funding because they are in what as known as a “valley of death” financially. The expectation is that the loans will generate $100 million despite loan failure rates as high as 50 percent. Any profit is expected to be recycled as more loans or grants.

Prior to the board meeting, the directors' Finance Subcommittee is scheduled on Friday to consider some basic matters concerning the loan program. The recommendations of the panel will go before the board at its meeting at the end of the month.

No background information has yet been posted concerning those matters, which range from criteria for certain loans to unspecified changes in loan administration policies.

Also on tap for the full board meeting is a discussion of the yet-to-be released results of a survey of the scientific grant reviewers concerning whether they would be willing to publicly disclose their financial interests. They are members of the Grants Working Group, which makes the de facto decisions on CIRM grants.

The Little Hoover Commission, the state's good government agency, recommended the survey because of the power of the scientific reviewers, who perform their work behind closed doors. Questions have been raised about conflicts on the part of the reviewers, in private by some researchers, but some in public.

It is commonplace for scientists to disclose financial interests in publication of research papers, but some CIRM directors fear that public disclosure of reviewer interests would result in the loss of some reviewers, who would resign rather than be subject to public scrutiny.

Also on the table for the meeting is the update to CIRM's strategic plan, which would officially set CIRM on a course for closer relationships with the biotech industry. The agency is currently engaged in a $100,000 search to fill a newly created vice president of research and development. The post has a salary range that tops out at $332,000 and is aimed at attracting candidates from industry.

Csete Quits CIRM on Eve of Huge Grant Round

In an unsettling move, Marie Csete has resigned as the chief scientific officer for the $3 billion California stem cell agency, only 15 months after she joined CIRM in the $310,000-a-year post.

Csete's departure comes as the agency is about to embark on its most ambitious and largest round of research grants – a complex, $210 million “disease team” effort aimed at pushing research towards clinical trials.

CIRM Board Chairman Robert Klein has described the round as critical for CIRM, both in terms of producing results and in generating support for the private sale of state bonds to support the agency.

John M. Simpson, stem cell project director for Consumer Watchdog, this afternoon disclosed Csete's departure on the blog on his organization's Web site.

In an email to members of the CIRM board, Csete(photo at left) said,

“I have decided to resign my position at CIRM as of August 1, 2009. I am sorry and disappointed that I was unable to say goodbye to you at the last ICOC (the CIRM board) meeting. I look forward to seeing your many successes! “

In response to a query, Simpson said,

"This is a sad day for CIRM. Dr Marie Csete, like Dr. Arlene Chiu before her, is the backbone of CIRM's scientific endeavors. It's particularly troubling that two top women scientists have left the agency after relatively short tenures. It raises serious questions about the agency's management under Chairman Bob Klein and President Alan Trounson. They owe the board a detailed explanation."

No successor appears to be in the wings. In a message to board members on behalf of Klein, Melissa King, executive director of the board, said,

“We will be working on a succession plan for Marie. Bob would like to talk to each of you to get your thoughts, and he and I will work on that in the coming days.”

On the surface, Klein's plan to call board members would appear to be a violation of the ban on serial meetings of public bodies such as the CIRM board. We suspect it will be justified on the basis that it deals with personnel matters, although it also overlaps into policy areas.

Csete's possible departure had been rumored for at least a month or more. She gave no reason for her resignation in the copies of the email messages that we have received. According to those we talked to, she was reportedly dissatisfied with CIRM's management and possibly with the reception afforded her scientific advice.

Simpson said the board should demand an explanation of her departure from Klein and Trounson.

Filling a high level post such as Csete's always takes a fair amount of time, but CIRM has been very slow in the past in filling top level positions, including that of president.

Prior to joining CIRM, Csete was John E. Steinhaus Professor of Anesthesiology at Emory University, with adjunct appointment in cell biology, and program faculty appointments in biochemistry, cell and developmental biology, neurosciences and the Emory/Georgia Tech Biomedical Engineering Program. She was additionally the director of liver transplant anesthesiology at the Emory University Hospital in Atlanta and director of the Emory/Georgia Tech Human Embryonic Stem Cell Core, and co-director of the Emory MD/PhD program.

In announcing Csete's appointment in March 2008, Trounson said,

”Her training and experience as both a basic researcher and clinician is critical to our strategy of advancing discoveries into the translational pipeline. In addition, her expertise in the field of transplantation and understanding of immunology issues will be highly relevant to advancing new discoveries in the stem cell field toward therapies and cures. ”

The announcement also said,

"'No one knows more about or is more skilled at dealing with the intersecting worlds of real-life clinical transplantation and basic stem cell research than Dr. Csete,' commented David J Stone, MD, Adjunct Professor of Anesthesiology and Neurological Surgery at the University of Virginia School of Medicine."

In the item below, you can read CIRM email messages concerning Csete”s departure.

Clinic vs. Basic Research: CIRM Funding Priorities

This item is part of the continuing coverage today of the board meeting of the California stem cell agency based on its audiocast.

The California stem cell agency today set a goal of raising roughly $240 million by privately selling state bonds over the next two years, preserving both its touted efforts to push development of therapies in the clinic and basic biological research.

CIRM Chairman Robert Klein told the board that one of those therapeutic efforts, a $210 million disease team program, is a critical piece in marketing the bonds and is unique to the agency. Without it, he said raising the funds not only will be more difficult but would turn the agency's back on its main mission.

Funding priorities came up today during the CIRM board meeting in Sacramento as a result of the financial plight of the agency, which will run out of cash next fall unless it sells bonds, virtually the only source of funding for the program.

Klein wrote the measure that created CIRM in such a fashion that it puts the agency outside the normal budget allocation processes involving the legislature and the governor.

Directors debated the virtues of funding grants for basic biology versus higher profile enterprises aimed at developing potential therapies at a more advanced stage of research.

Marie Csete(see photo), chief scientific officer for CIRM, told the board that scientists at recent hearings on CIRM's strategic plan were emphatic in stressing the importance of basic research, whose grant round sizes have already been cut.

Director Jeff Sheehy, a communications officer at UC San Francisco and a patient advocate representative, said the disease team project is already a year behind schedule. He said,

"We do not want to hamstring the disease team."

Requests for preliminary applications in that round have already gone out. It is scheduled to be awarded in September or October.

The goal set by the board of directors is just that. Klein will come back in late April with more information on his efforts to sell the bonds. The budget and funding priorities are expected to be reviewed again then.

CIRM Touts Its Financial Outlook

CIRM has officially but quietly announced that it hopes to raise $400 million through 2010 by selling California state bonds privately, a task never before achieved in state history.

The information on the private placement goal was posted Friday on the CIRM web site with virtually no notice or fanfare. The CIRM home page, which often carries far more trivial matters, makes no reference to the item about the state of CIRM's troubled finances. The three-paragraph posting was placed near the top of the CIRM web page page entitled "Funding Opportunities" and "Current Requests for Applications."

As far as we can tell, the item is the only significant reference on the CIRM web site to the hours and hours spent by worried directors last month discussing the agency's cash woes, other than the transcript of the meeting itself.

While the agency is now about seven months away from running out of cash, the Friday item has a positive headline, "CIRM's Financial Commitments Are Secure." The language is tailored to reassure grant applicants, especially those applying for the $210 million disease team RFA that was also posted on Friday.

The financial-status posting also refers to a "CIRM program with the state treasurer" for private placement of bonds. If the program is actually in place, it is a significant advance on the situation discussed by directors just three weeks ago. Many questions were raised at the time by directors about the plan. CIRM Chairman Robert Klein, who devised the private placement effort, promised to report back to the board at its meeting March 12.

CIRM seems determined not to call public attention to its financial problems, given its handling of the matter as long ago as its December board meeting. The January meeting included a lengthy briefing on the subject, but the public had no advance notice from CIRM of the sweeping scope of the problem. Even directors seemed taken aback.

A number of the directors were concerned about the public relations message that would be delivered as a result of the briefing and the ensuing discussion. There was a decided effort at the time to put a positive spin on the news. However, while directors approved $58 million in grants, they balked at funding until they knew more about the agency's finances. Efforts were also made to reassure current recipients of CIRM grants that money would still be forthcoming.

The public relations and positioning tactics could be construed as Pollyannish. But the agency must act in a way to retain the faith of the stem cell community that it will continue to operate unimpeded by what it hopes are transitory issues. CIRM needs a positive outlook to attract the best proposals for its disease round. It also must sell a story of past accomplishment and a rosy future to potential buyers of its bonds. No one is going to invest in a sinking ship.

At the same, CIRM directors and its executives should not be misled about the realities. Waiting too long to act on other measures to deal with the cash crunch will only compound the problem.

(A side note: In an operation independent of CIRM, the state of California is expected to announce later this week that it will make its first private placement of general obligation bonds, which could help smooth the way for CIRM sales with nervous investors. If the state does, in fact, make the private sale, CIRM, which has recorded a number of firsts in its brief life, will not have the opportunity to record another.)

Here is the full text of CIRM's "secure finances" posting:

"California voters approved the sale of  $3 billion in bonds to fund the work of the California Institute for Regenerative Medicine. The State finance committee created to oversee those bonds has authorized the issuance of the full amount.  A total of $2.5 billion in authority remains in funding availability. Proceeds from sale of the bonds are constitutionally protected and can only be used to fund CIRM programs and operations.

"CIRM currently has significant cash reserves of $160 million, which can fund all existing commitments through at least September. The agency’s plans have always called for raising new capital on a cash-flow, as-needed basis. We expect the traditional bond market will open soon with resolution of California’s budget situation.  To supplement this public bond market, CIRM is working with the State treasurer’s office on a CIRM private placement of $200 million in general obligation bonds this year and $200 million again next year.  The CIRM program with the State Treasurer is designed to produce sufficient funding in 2009 and again in 2010 to maintain the pace of funding under CIRM’s proposed grant schedule.

"The Agency intends to continue the planning and review needed to maintain its mission on schedule and expects that additional bond funds will become available by the time they are needed."

Monday Deadline for Canadians on CIRM's Big Disease Team Round

Canadian researchers have an urgent deadline to register for the competition for a piece of possibly as much as $210 million in team-funding in an international effort involving the California stem cell agency.

The collaboration is a Canadian-CIRM project (see item below) and is aimed at funding disease teams that will bring "an investigational new drug filing at the end of the four‐to‐five year grant."

Canadian registration is required by Monday Nov. 17.

The Canadians want the names of the PIs in both Canada and California and the following information:

"the scientifically mature opportunity, with strong preclinical proof-of-concept, to use cancer stem cells in the development of a therapy or diagnostic

"key milestones and deliverables required to achieve the objectives envisaged

"the nature of the partnership between the Canadian and Californian participants

"any anticipated commercial partnerships"

Here is a link to the registration document.

Canadian-California Researchers to Compete for Golden State Cash

The California stem cell agency said today that it will officially go international with an ambitious grant program that could run as high as $210 million.

CIRM released an announcement today aimed at alerting the California and Canadian stem cell communities of this "potential opportunity" and to encourage teams to begin work to snag some of the cash.

The collaborative funding effort involves the Canadian Stem Cell Consortium, which also participated in the joint announcement, and CIRM. The effort was ballyhooed last June but had few specifics.

Today's statement said the goal is to fund multi-disciplinary, disease teams of scientist to develop therapies for specific diseases. CIRM said,

"Successful proposals will include a description of milestones on a path to an investigational new drug filing at the end of the four‐to‐five year grant."

Funds are scheduled to be awarded next year. However, the specifics of the program have not yet been approved by CIRM directors, who are scheduled to take it up in December. Full Canadian approval is not yet in place as well. But both approvals are likely to be a formality.

The announcement may raise questions about the use of California dollars in an international research project. However, under the law, CIRM cash can only be spent in California. CIRM officials have repeatedly said that CIRM grants will be only spent on the California side of international collaborative efforts.

The announcement also raises another question about the fairness of the grant approval process in this case. Given the hooha about Canadian-California collaboration, it would seem that an application pegged to that effort would have an edge over competitors who only have a California program. At least, some other applicants might think so. But perhaps we're wrong.

If the grant round totals $210 million, it would be one of the largest rounds ever by CIRM.

San Diego's Sanford Center to Seek 16 Disease Team Grants

In the unlikely possibility that you missed it, the San Diego stem cell consortium announced earlier this month that it snagged $30 million from a South Dakota philanthropist, T. Denny Sanford(pictured).

That will come on top of the $43 million the consortium received from CIRM to build its new lab on a bluff overlooking the Pacific Ocean. Some 245 scientists will work out of the facility.

However, Heather Chambers of the San Diego Business Journal reported that the group is still $27 million shy of collecting enough cash to build and equip the $115 million, four-story facility. It is scheduled to be completed by December of 2010, or the consortium could face penalties from CIRM. Construction is scheduled to begin in January.

Terri Somers of the San Diego Union-Tribune put together a piece on the donation and its impact. Buried in her story was an interesting note on the consortium's plans to seek as many as 16 grants from CIRM in its upcoming disease team grant round. CIRM appears ready, however, to limit applications to four from an individual institutions.

The consortium consists of four organizations, Scripps, Salk, Burnham and UC San Diego. Based on Somers' story, it appears that the consortium plans to have each organization apply for four grants, which could run to $20 million or so each. Currently CIRM is allotting about $210 million, not including loans, for its disease team grants.

Obviously, there is not enough money for 16 grants at $20 million each for the San Diego quartet/consortium, not to mention other likely competitors from San Francisco to Los Angeles.

But San Diego's ambitious plans provide some indication of how tough the competition is getting for California stem cell cash.

We should also note that the consortium is no longer known as the San Diego consortium. Its name is now the "Sanford Center for Regenerative Medicine, an Institute of the California Institute for Regenerative Medicine." We should additionally note that Sanford, owner of First Premier Bank, has joined a number of other wealthy individuals who are making hefty contributions to help advance science and medicine. Sanford Center officials say more donors are welcome to help make up the $27 million shortfall, although raising cash in the current economic climate may be a tad tough.