CIRM Goes to Washington: Patents, Tornados and Bench Warming

As California stem cell directors this week consider once again their federal lobbying efforts, the Wall Street Journal offers an insight into just what it takes to have an impact in the august halls of Congress.

Can you say $27.6 million?

That's what a coalition of financial services organizations spent during the first quarter to change an accounting rule – albeit an important one – and lobby on other issues. The coalition also pumped $286,000 into the campaign organizations of lawmakers on a key committee.

Compare that to the $240,000 CIRM is spending for a federal lobbyist for 10 months work.

The issue that is coming up this week is CIRM's support for industry-backed legislation dealing with creation of generic biotech therapies. The agency currently has endorsed a measure by Rep. Anna Eshoo, D-Palo Alto, but has taken no position on a competing measure by Rep. Henry Waxman, D-Los Angeles, a far more important and powerful lawmaker.

The generic issue is complex enough on its own. But it apparently is going to be wrapped into the Obama administration's health plan, which Waxman will be carrying in the House. The rationale is that generic biotech therapies will cut costs, thus helping to trim the mammoth price of the health care deal. If the generic therapies are delayed because of industry-sought patent exclusivity, it means higher health care costs, according to supporters of the Waxman approach.

John Carroll of FierceBiotech recently wrote:

“Waxman has been pushing a bill that provides a five-year window of market exclusivity for biologics, something the biotech industry views with the kind of alarm a farmer feels when he sees a tornado heading for the barn. But there are a lot of numbers in play on the Hill. A competing bill offers 14 years of exclusivity and the president's budget proposal for 2010 pencils in a seven-year period.“

A Wall Street Journal blog this spring said the time may be ripe for a compromise and noted that some Big Pharma companies are warming to the idea of selling the copy-cat drugs themselves. The blog drew 18 comments, some of which indicated a high level of industry insight.

CIRM directors are oozing into a significant – for CIRM – federal lobbying role. But it is tiny in the world of Washington. Some on the board are concerned about mission creep and wasting time, money and focus on an effort where CIRM will never be more than a bench-warmer, if that. Directors are dealing with lobbying in what California stem cell Chairman Robert Klein calls an “incremental” fashion. Certainly CIRM can legally lobby Congress and probably should in some cases. But directors have never had a full-blown discussion on when, where and why.

$41 Million in Stem Cell Training Grants Look Good for CIRM Funding

The California stem cell agency today posted more information about what its board plans to do at its meeting next Tuesday, including what is close to a staff recommendation that $41 million be pumped into training programs at 15 institutions.

The training grants were approved earlier this year, but funding deferred because of CIRM's financial woes. But now that cash is available, CIRM staff urged the board to “seriously consider the resumption of funding” at the earliest possible date.

The memo supporting the move said that researchers need the trainees to continue support of research projects.

The memo said the previous training program, the first grants funded by CIRM, was well-regarded. The staff said,

“CIRM Scholars (trainees) conducted stem cell research in 219 distinct laboratories and produced 221 publications, many in high impact journals.

“Upon completing training, individual CIRM Scholars have moved on to faculty positions at top universities, to scientific positions in biotechnology/pharmaceutical companies, or to further training at laboratories of leading stem cell scientists. Many physician CIRM Scholars are now also practicing medicine with a strong knowledge base of stem cell science. Outstanding examples of CIRM Scholar achievements include: research leading to the founding of a biotechnology company and the research leading to a Phase 1 clinical trial.

“In addition to trainee success, the program has served as a focal point for stem cell research at each of the training institutions and produced an attractive stem cell research environment that has contributed to the recruitment of new faculty as well as top trainees. The research conducted by trainees has spanned the spectrum from basic to preclinical research and, importantly, has accelerated research through synergy with other CIRM funded projects.”

Also posted was a three-page justification for continuing the longstanding contract with Remcho, Johansen & Purcell of San Leandro, Ca., as outside counsel to CIRM at $450,000 a year. James Harrison, an attorney with that firm, has been Remcho's visible and unflappable representative on CIRM matters since 2005.

Remcho charges CIRM $350 an hour for work by Harrison, which the CIRM memo said “is significantly lower than the market rates for firms with similar expertise.” Work done by others at the firm is charged at lesser rates. If Remcho billed $450,000 at the $350 rate, it would amount to about six months of full-time work.

Also on tap next week is a do-over on motions for CIRM support of industry-backed legislation aimed at protecting biotech patents against development of generic biotech therapies. Now available on the CIRM Web site is a memo that summarizes the latest developments in Congress and the White House.

An updated version of the CIRM conflict of interest code is also available and has been placed on the consent calendar as a non-controversial item. Removed from the agenda are the consolidated IP regulations, which are to be considered at a later date. No reason was given for delaying the item.

Still missing are guidelines for a change in board voting procedures that could enhance the powers of the board chairman and information about the leadership and some of the membership of the directors subcommittee that will evaluate Chairman Bob Klein, the two vice chairs and CIRM President Alan Trounson.

CIRM Directors Consider Millions in Grants, Industry-backed Federal Legislation and Agency's Budget,

California stem cell researchers are likely to see millions of more dollars come their way next week at the San Diego meeting of the board of the state's $3 billion stem cell agency.

The grant approvals are likely to receive little notice in the media even though the rest of the state is struggling with a $24 billion budget deficit. Funding for CIRM cannot be touched by state lawmakers who are considering major cuts in programs to assist the poor and elderly.

Up for consideration are grants for training programs and early translational research efforts. Funding decisions on those programs were deferred earlier this year when CIRM faced its own financial crisis because of a lack of bond funding, the agency's source of cash. The tension eased this spring when CIRM received a $500 million infusion in the most recent bond sale.

Good arguments exist for a steady stream of cash for research, which cannot sustain itself on feast-and-famine funding. Good arguments also exist for rational state budgeting that is not crippled by ballot measures that have helped to create the state's current fiscal disaster. Prop. 71, which created CIRM, is only one of many measures that have tied the hands of those who are ultimately responsible for making state budget decisions.

Also on tap for the meeting June 17-18 is consideration of the 2009-2010 CIRM budget, which additionally comes before the Finance Subcommittee this Thursday. No information on its budget has been released to the public by CIRM with the Finance meeting only two business days away.

Perhaps the topic of funding CIRM with money from the biotech industry may surface. Certainly the topic of future funding is on the subcommittee agenda.

Directors are also going to take another whack at federal legislation, backed by the biotech industry, to create patent rights to prevent early development of generic biotech therapies. At one point this spring, the board voted to develop support for key principles behind such legislation. Most recently, it decided, however, to endorse an industry-backed bill. After questions were raised about the legality of the board vote, Chairman Robert Klein decided to ask the board to vote again on the matter this month.

Another agenda item: The touchy subject of leadership of the directors committee that will evaluate the performance of Klein, the two vice chairs and CIRM President Alan Trounson.

In April, Klein resisted a motion by board member Jeff Sheehy that the chairs of the Evaluation Committee be the two directors who developed the evaluation procedure, Sherry Lansing, former head of a Hollywood film studio, and Claire Pomeroy, dean of the UC Davis School of Medicine. Other directors were concerned about the composition of the Evaluation Committee, suggesting it provided an appearance of conflicts of interest and “self-dealing.”

Also on the agenda is consideration of new contract with Remcho, Johansen & Purcell of San Leandro, Ca., which has been the outside counsel for CIRM since day one. The contract has never been put out to bid, based on an oral opinion from the State Department of Justice.

Another matter before the board involves guidelines for when the roll call should be held open on votes, a technique much used in the state Legislature but which also ensures that the chairman can find the votes needed when he needs them. More on that in the item below.

CIRM as a Lobbyist: Mission Creep, Industry Ties and Board Conflicts

The California stem cell agency is once again going to consider its position and lobbying efforts on behalf of industry-supported federal legislation dealing with development of generic biotech therapies.

The topic is expected to be placed on the June agenda of the CIRM board because of a question about whether the board's endorsement of the bill on May 12 complied with the state's open government laws.

On the surface, the matter involves what some might consider a relatively minor legal point. But the endorsement also goes to both CIRM's mission -- whether it should be involved in heavy-duty federal lobbying -- and the agency's ties to the biotech industry and possible financial links involving directors.

John M. Simpson, stem cell project director of Consumer Watchdog of Santa Monica, Ca., raised the issue of legality of the board endorsement with CIRM's outside counsel, James Harrison of Remcho, Johansen and Purcell of San Leandro, Ca. Simpson has shared his exchange of emails with Harrison with the California Stem Cell Report.

Simpson wrote Harrison on May 14, arguing that the motion to support the federal bill was "improperly passed" and is therefore void.

Simpson said,

"No notice was given that there would be consideration of supporting a particular bill. In fact the consensus at the previous (board) meeting was to develop principles.

"Based on the earlier meeting and the posted agenda, I decided not to attend one of the public sessions in person where I would have been able to comment. Instead I opted to listen to the meting over the Web. It is quite possible some (board) members not in attendance made the same decision."

Harrison responded on May 19,

"As you know, (the) Bagley-Keene (act) requires that a board's agenda include a 'brief general description of an item' to be transacted at the meeting. (Gov. Code,§ 11125.) Furthermore, Government Code section 11130.3 provides that an action is not void for failure to provide notice so long as the agenda was in 'substantial compliance' with Section 11125. The board's agenda for its May 12, 2009, meeting clearly satisfied the requirements of Bagley-Keene. Indeed, it specifically cited HR 1548, the federal legislation that was the subject of the motion. The agenda requirements of Bagley-Keene were not intended to prevent debate from evolving or to hamstring a board from taking action. In this case, the board's agenda was more than sufficient to put the public on notice that the board would consider federal biosimilar legislation. We therefore disagree with your assessment regarding the propriety of the agenda.

"Nevertheless, in order to provide a further opportunity for board member and public comment and to address any new developments, Chairman (Robert) Klein has directed staff to include an item relating to consideration of federal biosimilar legislation (HR 1427 and HR 1548) on the board's June agenda. The board will therefore be free to consider public comment and additional motions relating to this item."

Simpson said he disagreed with Harrison's analysis but appreciated that the matter would be brought up again.

The move to endorse HR 1548 by Rep. Anna Eshoo, D-Palo Alto, dates back to last month. (You can read more here, here and here.)

Supporters of CIRM's endorsement of her bill have argued that it is necessary to protect the biotech industry, which has perennial financial problems, so that it will develop drugs. Opponents have worried about mission creep at the tiny agency, which has a staff of about 39 persons. They have also suggested that CIRM is fooling itself if it thinks it can be a major player in Washington.

One anonymous reader also raised concerns about possible conflicts of interests among board members. In a comment filed on our May 12 item, the reader said "the whole thing stinks." The reader wrote,

"The industry members of the board include at least one self-described former employee of biotech leader, Genentech. Are there stock options? What about former Chiron founder and ex-vice-chair, (Ed) Penhoet, does he have stock options? What about the new CIRM counsel, formerly at Genentech, does she have
options?

"What about the two UCSF members, the UCSF (medical school) dean and Jeff Sheehy, who now answer to a former Genentech executive, UCSF's new
chancellor?...

"The whole thing stinks. Using a position on a state board to direct state funds to lobby for a bill to advance one's own private interests over those of patients ought to be against the law. This smells like Cheney and Halliburton!"

We do not have answers to the reader's questions, but we should note that Sheehy has expressed major reservations about endorsing the bill. Nonetheless, the reader's concerns highlight the conflict-riddled nature of the stem cell agency and the virulent suspicions that the situation can generate. The reader's comments also speak to CIRM's transparency and accountability, which will come under scrutiny this afternoon in Sacramento.

That's when a subcommittee of the state's Little Hoover Commission, the state's good government agency, will consider possible recommendations for changes in the operation of the $3 billion state stem cell research effort.

Latest CIRM Comments on NIH hESC Rules

Here is a link to the most recent version of CIRM's comments on the proposed NIH rules on human embryonic stem cell research. Comments to the NIH must be filed by May 26.

CIRM Seeks Changes in NIH hESC Plans

The CIRM board of directors today approved recommendations for changes in proposed NIH rules for research involving human embryonic stem cells.

The action came on a 20-0 vote in a session during which directors were told that 7,000 responses to the rules had been received by the NIH. CIRM Chairman Robert Klein said the responses were running 7 to 1 against.

CIRM supports the NIH plans with some changes. The opposition appears to oppose them outright for religious reasons.

Board members were encouraged to individually call on their constituencies to file comments on behalf of hESC research with the NIH. Philip Pizzo, dean of the Stanford School of Medicine, said he had already done so in his weekly newsletter and emailed a copy of his comments to board staff for wider distribution.

Klein said the agency could not legally ask all its grant recipients in a “mass mailing” to support hESC research, but he said individual board members were free to do whatever they wished.

Geoff Lomax, senior officer for the CIRM Standards Working Group, developed the recommendations following a public hearing and contacts with researchers. He said the suggestions were aimed at avoiding the loss of material that is needed scientifically and already in use.

The document presented to the board will be refined by attorneys and staff before it is sent to the NIH by May 26.

CIRM Backs Biotech Industry Legislation, Aiming for Greater Federal Influence

The California stem cell agency today performed something of a semi-reversal and endorsed industry-supported federal legislation that would set rules for creation of generic biotech drugs.

CIRM’s board of directors last month supported a move to develop a statement of principles on the legislation, declining to ratify a recommendation by its Legislative Subcommittee that it support the industry bill.

However, this morning the board decided to back the industry measure rather than acting on the statement of principles developed by its staff over the last two weeks. The vote was 16-2 with two abstentions.

The consensus was that the industry needed to be encouraged financially to develop therapies, generally following the arguments made at the board meeting April 28-29.

Board member Joan Samuelson of Healdsburg, Ca., a patient advocate representative on the board, today said,

“The overriding concern is getting therapies to patients.”

Board member Oswald Steward, chair and director, Reeve, Irvine Research Center, University of California, Irvine, said, however, the board “should not act like a political action committee.” He said it “should be respected as much as the National Academy of Sciences.”

Jeff Sheehy, another board member and director for communications, UCSF AIDS Research Institute, supported Steward’s position, declaring he had “a lot of problems supporting a particular bill.” He said it would take the board “fairly deeply into the legislative process.”

Several board members, including Chairman Robert Klein, argued that CIRM could not become a player on the legislation without taking a specific stand. A statement of principles was meaningless at this point, they said.

The bill backed by CIRM is HR 1548 by Rep. Anna Eshoo, D-Palo Alto, which is favored by the Biotechnology Industry Organization. The board took no position on a rival bill, HR 1427 by Rep. Henry Waxman, D-Los Angeles, which BIO opposes. The Generic Pharmaceutical Association opposes the Eshoo bill.

Some board members were concerned about irritating Waxman, including Gerald Levey, dean of the UCLA School of Medicine. He said he did not “want to see CIRM caught in a political battle because we have enough of those.”

CIRM Vice Chairman Art Torres, a former state legislator who worked with Waxman, indicated that relations with Waxman would not be a problem as long the board did not directly oppose the Waxman bill.

Torres also indicated that the competing proposals may be wrapped into President Obama’s health initiative, which Waxman would carry.

A subtext of today’s session concerned the extent of CIRM’s role as a lobbyist at the federal level. The statement of principles on the legislation made a strong case for federal activities by CIRM as did Klein. CIRM recently hired a powerful Washington lobbyist, the Podesta Group, on a $240,000, 10-month contract, but the board has never had a full-blown discussion about how far it wants to go in lobbying at the federal level. The state of California has its own lobbyist, who works out of the governor’s office, but few, if any, state agencies engage in major federal lobbying efforts.

To be a significant player on the federal scene requires a hefty effort. Spending on lobbyists (nearly 11,000 in all) totaled $3.3 billion last year, and that figure does not reflect all expenditures made in attempts to influence federal legislation and regulations.

We invite comment on this subject or others. You can comment by clicking on the word "comment" below. Anonymous comments are permitted.

CIRM Debate on Federal Issues Available at Many Locations Throughout California

Federal biotech legislation and proposed NIH rules on hESC research are the topics early Tuesday morning at a meeting of the board of the California stem cell agency that will be accessible at teleconference locations throughout California and on the Internet.

Interactivity will not be available for the Internet audiocast, but will be possible at multiple locations, including San Francisco (4), Los Angeles(2), Sacramento, La Jolla(3), Pleasanton, Berkeley, Elk Grove, Healdsburg, Hillsborouugh, Irvine(2), Stanford and Beverly Hills. Specific addresses where the public can attend can be found on the agenda.

CIRM said that the meeting can be heard on the Internet by using this URL:
http://65.197.1.15/att/confcast

No background material has been posted yet for the meeting, but you can read more about the issues here.

Podesta, CIRM and the Biotech Industry

The federal lobbyist for the California stem cell agency is doing quite well financially so far this year, but the CIRM account represents only a tiny fraction of its business.

During the first quarter of this year, the Podesta Group raked in $5.2 million, up 50 percent from a year ago, according to a story by Kevin Bogardus of The Hill Web site. The Washington, D.C., lobbyist won a $240,000, 10-month contract from CIRM earlier this year. In addition to California's publicly funded stem cell research effort, Podesta counts some major players in the pharmaceutical industry among its clients.

Federal lobbying is a big business. Total spending in 2008 hit $3.27 billion (yes, Billion) in 2008, up from $2.84 billion the previous year, according to Opensecrets.org. But the number of federal lobbyists is down to 10,785 from 15,287 last year.

Podesta accounted for only $16 million of the 2008 total. Most of its clients paid the firm less than $500,000 last year. They include Amgen, $240,000; Amylin, $180,00; Cubist Pharamceuticals, $150,000; Millenium Pharmaceuticals, $200,000; Novartis, $210,00; Reed Elsevier, $690,000; Roche, $240,000; Sereno, $350,000; Sunshine in Government Initiative, $200,000, and the University of Texas Anderson Medical Center, $300,000.

One of the issues currently being lobbied hard in Washington involves the financial future of the biotech industry. Competing legislation is before Congress that would set the rules for creation of generic biotech drugs -- biosimiliars.

It is also an issue on which CIRM is scheduled to take a position on May 12, although the CIRM board has backed away from a stand on specific bills.

J.K. Wall of the Indianapolis Business Journal on March 23 wrote about the lobbying efforts of Eli Lilly on biosimiliars.

Wall wrote:

"Indeed, generic biotech drugs represent a big threat to the large pharmaceutical companies, which increasingly have turned to biotech drugs for growth as their most successful chemical-pill-form medicines cruise toward the end of their patent lives."

Wall continued,

"Trouble is, biotech has become a synonym for exorbitant. For example, Herceptin, a biotech breast cancer treatment introduced 11 years ago by Genentech Inc, costs $40,000 for one year of treatment.

"'Excessive exclusivity means that it will be decades before patients have access to affordable biogeneric medicines,' said Kathleen Jaeger, CEO of the Generic Pharmaceutical Association, in a statement. 'Timely access to affordable biogenerics will save lives and save consumers and state and federal governments billions of dollars.'"

At its board meeting last month, some CIRM directors exhibited considerable discomfort at entering the fray with specific endorsements of competing legislation. Some questioned not only the appropriateness of CIRM taking a position, but whether it could have any significant impact on the legislative process. Mission creep was one complaint.

But the need to "protect" the biotech industry carried the day, and CIRM is scheduled to approve a statement of principles on generic biotech drugs on May 12.

No doubt exists that this is an important issue, affecting the industry and the development of drugs that could potentially ease much misery and suffering.

But one wonders whether California voters, in approving Prop. 71, envisioned hundreds of thousands of taxpayer dollars being spent for lobbying on behalf of any industry.

One also wonders about CIRM's relationship with Podesta and its array of drug industry clients. Which is the dog and which is the tail? Do CIRM's interests become subsumed in the pharmaceutical mix? And how can California taxpayers know for sure? Perhaps they can ask one of Podesta's other clients: The Sunshine in Government Initiative.

CIRM Takes on Federal Chores

The California stem cell agency will be dealing with federal stem cell and biotech matters over the next couple of weeks, including the proposed NIH rules on hESC research.

The agency has created a task force that will meet publicly this Thursday to hear comments on the rules. The panel is preparing a report that will be submitted to the full CIRM board on May 12 with the intent of getting the comments to the NIH later this month.

You can find CIRM's preliminary work on the subject here and our report here. Comments for CIRM can also be submitted via email at info@cirm.ca.gov.

Also on tap for the May 12 board meeting is consideration of a statement of principles dealing with federal legislation on production of biosimiliars, which would be copies of biotech drugs following expiration of their patents.

Teleconference locations are available for the May 12 meeting in San Francisco, Los Angeles(2), Sacramento, La Jolla(2), Pleasanton, Berkeley, Elk Grove, Healdsburg, and Irvine(2). Specific addresses can be found on the agenda.

Five teleconference locations exist for Thursday's meeting: San Francisco Elk Grove, Los Angeles, Healdsburg and Duarte. You find the addresses on the agenda.

CIRM Debates Federal Legislation; $60 Million Grant Approvals Scheduled for Today

LOS ANGELES -- The board of the California stem cell agency last night backed away from endorsing industry-supported federal legislation dealing with biosimiliars, which would be copies of original biotechnological drugs following expiration of patent protection.

The board did not go along with its Legislative Subcommittee recommendation to support HR 1548 by Rep. Anna Eshoo, D-Palo Alto, which is favored by the Biotechnology Industry Organization. The subcommittee took no position on a rival bill, HR 1427 by Rep. Henry Waxman, D-Los Angeles, which BIO opposes.

Instead of endorsing the Eshoo measure, the board voted to seek development of a statement of principles that it would like to see in any such legislation. That statement could come up before the full board during a telephonic meeting May 12.

Robert Price, who sits on the board as an alternate for UC Berkeley Chancellor Robert Birgeneau, questioned the value of CIRM taking any position at all on the legislation.

Price, who is associate vice chancellor for research at UC Berkeley, asked,

"Do we really matter that much? I think we don't. Let's not engage in hubris here."

A number of other members of the board spoke both on behalf of the legislation and the need to protect businesses that put up the cash to develop new drugs.

Board member Ed Penhoet, former president of Chiron and a member of the National Academcy Sciences Board on Science, Technoloogy and Economic Policy, said the two pieces of legislation deal with the balance between the cost of therapies and the cost of innovation. He said it was "the most important issue in health care today."

Board member Sherry Lansing, the former head of a Hollywood film studio and a University of California regent, said,

"There will be no drugs unless we protect the people who take the risk."

As for the argument over high costs denying access to drugs, CIRM Vice Chairman Art Torres, former chairman of the California state Democratic Party, said,

"You can't have accessibility unless you have something to access."

John M. Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., characterized the push for CIRM to become a player in Congress as a "little bit of mission creep."

In other business, CIRM communications chief Don Gibbons previewed the agency's new website, which he said should be up in a few days. He said it was designed to offer more information that will be better organized and accessible.

CIRM officials also officially confirmed for board members the news on the California Stem Cell Report that the agency's financial woes are over for some time. The agency will receive $505 million from the recent state bond sale. However, cash will get tight again by the end of 2010 unless CIRM raises more funds through the sale of state bonds.

In light of the good financial news, the board indicated that it wanted to reconsider its one-year delay in a training grant program. That topic is expected to come up in June. Additionally put off was an update on CIRM grantee progress report monitoring. Earlier a CIRM official had said said grants would be pulled because of a lack of progress, but he did not say when that would be announced.

Also on the board agenda last night were applications for $60 million in grants, including four petitions to overturn negative recommendations from reviewers. However, that was put off until this morning along with a request for $200,000 to co-sponsor the annual convention of the International Society for Stem Cell Research.

Another item scheduled to be acted on today is the performance evaluation process for the Chairman Robert Klein, President Alan Trounson and Vice Chairs Torres and Duane Roth. It is the first time the CIRM board has officially promulgated publicly an evaluation procedure for the positions. But until recently the chair and vice chairs did not receive compensation. Roth has declined a salary, but Torres is receiving one.

This morning's meeting can be heard via the Internet. Details for the Web access are here. Teleconference locations for listening and participating are available in Sacramento, Pleasanton and at Stanford. Specific addresses can be found here.

Public CIRM Hearing Next Week on NIH hESC Rules

If you are interested in the proposed NIH regulations for hESC research and California's reaction to them, put a May 7 meeting of the California stem cell agency on your calendar.

Not long after the CIRM directors Legislative Subcommittee Monday approved creation of a task force on the subject, a meeting with teleconference locations in San Francisco, Elk Grove, Los Angeles, Healdsburg and Duarte was scheduled for next week. Specific addresses can be found on the agenda.

Comments on the proposed rules must be submitted by May 24 to the NIH. You can read more on what CIRM has done so far here, but keep in mind that this is very much a work in progress.

CIRM's Initial Assessment on NIH hESC Rules; Task Force to Develop More Analysis

A key group of directors of the California stem cell agency this morning moved to create a task force to study and comment on the proposed NIH rules for human embryonic stem cell research.

The Legislative Subcommittee of the CIRM board of directors voted 7-0 to proceed with the work on the NIH rules, which have drawn fire from scientists in California. The action now goes to the full board for expected approval at its meeting Tuesday and Wednesday in Los Angeles.

CIRM plans to consult with institutions, scientists, the public and others in developing an analysis and recommendations on the NIH rules by May 24. Meetings of the task force are expected to be conducted in public. The CIRM board will hold a telephonic, public meeting on the final CIRM document, according to CIRM Chairman Robert Klein.

CIRM will also work with the Interstate Alliance on Stem Cell Research in developing its proposal. The alliance previously scheduled a May 5 meeting in Washington, D.C., which could provide a venue for exploration of the issues, said Geoff Lomax, senior officer for medical and ethical standards.

Following the 7:30 a.m. meeting today, CIRM posted background material and other information on the issues on its website. They include a comparison between the NIH guidelines and CIRM regulations and an intial assessment of the impact of the NIH proposal.

Among other things, CIRM's first-cut at the rules said,

"Our conclusion from this preliminary analysis is that the consent protocol for some lines does not include all items identified by NIH in its eligibility criteria, suggesting some scientifically significant lines may not qualify. All lines evaluated were derived from balstocysts created for reproductive purposes but no longer required for family planning."

"The draft policy sets ' high bar' for consent and disclosure. There are concerns that established cell lines may not meet the proposed standard. Substantial foundational research has been performed utilizing established lines. NIH should consider a 'grandfathering' clause or other mechanism that enables continued use of established lines. NIH should give consideration to whether a particular line was derived in accordance with consensus guidelines or the legal requirements at the time of consent or derivation."

"Further, experience suggests there may be uncertainty to whether specific cell lines conform to every requirement of the draft guidelines. This uncertainty may result in qualifying lines not being utilized. There was broad consensus that a registry of compliant lines would be the most efficient method for identifying lines and ensuring promising research materials are not unnecessarily disqualified."

"For grantee institutions the promulgation of NIH guidelines raises question related to the implementation of grants where a mix of funding is involved. For example, one institution identified the case where research involves a comparative analysis of multiple hESC lines. It is conceivable that such a study could involve lines not recognized or approved by every funding source. Harmonization of rules, to the extent allowed by law, would be desirable from this grantees perspective."

CIRM said,

"As the largest funder of human embryonic stem cell research in the world, CIRM has an interest in ensuring that the NIH rules are consistent with CIRM’s medical and ethical standards, which were modeled upon guidelines adopted by the National Academies of Science, and with the best interests of science and patients."

The NIH announced its proposed new rules only 10 days ago. CIRM completed its preliminary analysis last Friday. However, the actually posting of documents relies on a state department that does not work during the weekend.

The Legislative Subcommittee also voted to support 6-0 with one abstention (Jeff Sheehy) a federal bill dealing with biosimiliars, which are copies of the original biotechnological drugs following the expiration of patent protection.

The panel backed HR 1548, by Rep. Anna Eshoo, D-Palo Alto, which is also supported by the Biotechnology Industry Organization. The industry group opposes a rival bill, HR 1427 by Rep. Henry Waxman, D-Los Angeles. The subcommittee did not take a position on Waxman's bill.

CIRM Panel to Debate NIH Rules This Morning

The San Francisco Chronicle this morning carried a stout defense of the NIH's proposed rules for human embryonic stem cell research just hours before the California stem cell agency is scheduled to debate the proposal.

The proposed regulations, opposed by some scientists in California, were endorsed Jesse Reynolds of the Center for Genetics and Society of Oakland, Ca., in an op-ed piece in the Chronicle.

Reynolds said the proposals were thoughtful and the "right thing to do."

He said that that barring federal funds for cloning-based stem cell research would help to prevent creation of a technical foundation for reproductive cloning, which "continues to tempt rogue scientists."

The CIRM directors Legislative Subcommittee is scheduled to take up the NIH proposal at 7:30 a.m. PDT today. The agency has only posted a cryptic agenda item on the subject and has not offered to the public any analysis of the regulations or a rationale for why CIRM should take a position on the federal plan.

We will have coverage of the meeting later today.

Translational Grant Reviews Now Available From CIRM

The California stem cell agency has posted the reviews of grant applications for $60 million for early translational research that will be awarded at next week's meeting of CIRM's board of directors in Los Angeles.

Ten grants are scheduled to be approved by directors. However, grant reviewers have given the okay to 15 totaling about $68 million. If the directors want to stay within their original budget, they will have to take the rare step of rejecting a positive decision on grants by reviewers.

The grants that have won reviewer approval include proposals dealing with cartilage regeneration and osteoarthritis, Alzheimer's, Parkinson's and macular degeneration. You can find the reviews here along with their scores.

The names of the applicants have been withheld by CIRM, but the identities of some may be discerned from the reviews by persons familiar with stem cell research.

Also now available on the directors' agenda is a side-by-side comparison of two federal bills dealing with biosimiliars, which are copies of the original biotechnological drugs following the expiration of patent protection. Directors are expected to be asked to take a position on the measures, but they will first be discussed Monday morning by the Legislative Subcommittee.

One of the bills, HR 1548, by Rep. Anna Eshoo, D-Palo Alto, is supported by the Biotechnology Industry Organization, which opposes a rival bill, HR 1427 by Rep. Henry Waxman, D-Los Angeles. It would be interesting to know whether CIRM's $240,000, federal lobbyist, the Podesta Group, is lobbying for or against either one of the bills.

With three business days remaining before the directors meeting, CIRM has not posted any background material on its possible position on the proposed NIH rules on hESC research and several other items. They include the monitoring of CIRM grantees, the agency's statewide education program and evaluation procedures for the chair, vice chair and president.

CIRM and the NIH: A Stand on the Proposed hESC Rules?

Directors of the California stem cell agency next week will take up the proposed NIH regulations for human embryonic stem cell research that have triggered dismay among some scientists in the state and elsewhere.

The topic is on the agenda of the CIRM directors' Legislative Subcommittee meeting one week from today and then it comes before the full board the following day or two at its Los Angeles meeting.

In the eyes of some influential scientists, the proposed regulations are too restrictive. Irv Weissman of Stanford promptly criticized them last Friday as just substituting one ideology for another. Susan Fisher, co-director of stem cell research at UC San Francisco, also was not pleased. She told Lisa Krieger of the San Jose Mercury News,

"This mostly moves the line in the sand from 2001 to 2009."

Fisher said,

"We still desperately need CIRM and private funding,"

On the East Coast, reporter Ceci Connolly of the Washington Post wrote,

"'I am really, really startled,' said Susan L. Solomon, chief executive of the private New York Stem Cell Foundation. 'This seems to be a political calculus when what we want in this country is a scientific research calculus.'"

Generally, however, the proposed NIH rules received mild or better praise in most of the stories that we have seen. Jesse Reynolds of the Center for Genetics and Society in Oakland, Ca., wrote on his organization's blog, Biopolitical Times, that the NIH "got it right."

He said the regulations are "consistent with his (Obama's) campaign promises, consistent with public opinion, and draw lines in a way that will allow promising research to go forward while preventing potential abuses."

It was clear, however, that the NIH rules are very much a product that was based on a reading of public opinion about stem cell science, a fact that was mentioned in several stories.

Reporter Gardiner Harris of the New York Times also noted a bit of presidential political history, writing,

"During the campaign last year, Mr. Obama said he supported 'therapeutic cloning of stem cells,' a policy his administration rejected Friday. A White House spokesman, Reid Cherlin, said the president 'directed N.I.H. to formulate the best method for moving forward with stem cell research, both ethically and scientifically,' in an independent process."

CIRM's decision to place the regulations before its directors raises some interesting questions.
What does CIRM have to gain by entering this particular fray? Failure to oppose them will alienate some influential researchers and perhaps their parent institutions.

Supporting the rules could be regarded as institutionally self-serving and as an attempt to justify the continued existence of CIRM, whose origins were based on former President Bush's restrictive policies. Some of have argued that CIRM is now irrelevant, given Obama's moves and the changing nature of stem cell science. However, it is hard to see how $3 billion in research funding could be considered irrelevant by anyone. The NIH is certainly not going to fund all the fondest desires of even those who qualify under its proposed rules.

Also on next week's CIRM agendas are other federal matters that could place CIRM in the middle of a pharmaceutical war. Up for consideration by CIRM directors are two Congressional bills involving biosimiliars – HR 1427 by Rep. Henry Waxman, D-Los Angeles, and HR 1548 by Rep. Anna Eshoo, D-Palo Alto.

The Biotechnology Industry Organization does not care for Waxman's bill, declaring that it "would jeopardize patient safety and undermine future medical breakthroughs," according to Patricia Van Arnum of Pharmatech.com. Waxman, of course, thinks differently.

He said his bill would "allow the Food and Drug Administration to approve affordable copies of biotech drugs." He said,

"Biotech drugs, while often life-saving, are the fastest growing and most expensive components of the nation’s prescription drug bill."

BIO favors Eshoo's bill, according to Van Arnum, declaring that it balances "the need to increase access, lower costs, ensure drug safety and promote continued biomedical breakthroughs."

The Legislative Subcommittee meeting will have teleconference access available 7:30 a.m. next Monday at seven locations: two in San Francisco and others in Portola Valley, Menlo Park, Elk Grove, Healdsburg and La Jolla. You can listen in and participate from those locations. If you are unable to attend, you may submit a statement by sending it to info@cirm.ca.gov.

The full board meeting does not have interactive teleconference access, but it may be available via the Internet and a phone line audiocast.

We invite comment on this item and CIRM's role in NIH affairs. You can submit comments by clicking on the word "comments" below. Anonymous comments are permitted.

Stem Cells and Three California Movers and Shakers

The Capitol Weekly newspaper in Sacramento today identified three men with close ties to California stem cell issues as among the top 50 political players in the state.

The list included Eli Broad, Richard Blum and the man behind CIRM's Sacramento lobbying firm. The rankings did not include elected officials, such as the governor, who is a good friend of the California stem cell agency.

Ranked No. 5 was Broad, the Los Angeles billionaire businessman who has funded stem cell research at UCLA, USC and UC San Francisco with tens of millions of dollars. In the 2007-08 election cycle, he spent nearly $1 million on political efforts. "If money talks, then everybody listens to Eli...," the newspaper reported.

Ranked No. 6 was Steve Merksamer of the firm of Nielsen, Merksamer, Parrinello, Mueller & Naylor, which is the Sacramento lobbyist for CIRM. Merksamer was one of its founding partners. The firm has been on retainer with CIRM since the agency's earliest days and currently has a $49,200-a-year contract with the agency for its services, which CIRM coyly describes as "public education." Capitol Weekly said Merksamer is "is one of the state’s most influential political-legal players. His 16-lawyer firm is involved in a myriad of political issues and dispenses legal advice and political strategy to a national and international big-business clientele."

Ranked No. 14 was Blum, chairman and president, Blum Capital, a major equity investment management firm. Blum is a University of California regent as is Sherry Lansing, a member of the board of directors of CIRM. Blum is also the husband of Democratic U.S. Sen. Dianne Feinstein. Blum Capital Partners purchased $1 million in bond anticipation notes to help fund CIRM in 2006.

The list of 50 is the first installment in a Top 100 count, with more "influence peddlers, power brokers and political players" to come next week.

Klein Promoting Stem Cell Issues in Washington

This item has been removed. The Robert Klein involved in it is not connected with the California stem cell agency, we have been told.

Torres-Roth Election: An Adroit Move for CIRM

Without so much as lifting a finger, Art Torres has already had a salubrious financial impact on the California stem cell agency.

Last week, Torres(at left), the leader of the state Democratic Party and a former, longtime state legislator, was elected co-vice chair of the agency. As a result, CIRM has dropped its efforts to hire an in-house legislative relations staffer. That position has a salary range that tops out at $138,800. Torres is being paid $75,000 for halftime work.

On Tuesday, we noticed that the job opening was missing from the CIRM web site. We queried Don Gibbons, chief communications officer, whether the position was filled. He responded,

"We are saving money. The position is not needed with Art here."

Dropping the recruitment effort is modestly beneficial financially now and for the foreseeable future, given the agency's financial plight. But CIRM is chronically understaffed – capped at 50 persons by a nearly immutable state law. The agency relies heavily on outside contractors for its work – a situation fraught with well-documented financial and managerial peril at any level of government.

As for the election of Torres and Duane Roth as dual vice chairs, we think it was an adroit move, one that will benefit CIRM, certainly in the short term. A potential political problem was avoided. Much-needed internal heft was added to CIRM's governmental relations efforts along with its relations with the biotech industry. Torres will also bring a long-needed, experienced voice in governmental affairs to the highest levels of CIRM.

But as in all things, the devil is in the details of execution. If Roth and Torres butt heads significantly, either sooner or later, it could be a serious diversion from CIRM's main objectives. That is not to mention whether CIRM Chairman Robert Klein, who controls what the men do, can delegate responsibility and authority effectively without micromanaging their work. That goal for Klein should be high on the evaluation priorities by the CIRM directors' Governance Subcommittee.

Earlier this week, The Sacramento Bee editorialized that the dual vice chair situation is a poor idea because it makes it harder to check Klein's broad powers. A single vice chair would be more powerful, The Bee argued. There is a certain logic to that argument. However, the vice chairs are largely Klein's creatures. He is the one who is charged with setting their agendas, although the board of directors has a role as well. Should Klein feel that either Roth or Torres are impinging on his prerogatives, we have no doubt that he will move to freeze them out.

On the other hand, Torres is a veteran political operator and will soon develop his own constituencies and alliances both within the board as well as with outside organizations and lawmakers, both in Washington and Sacramento. Roth also already has his own constituencies within the biomedical industry and on the board.

One final note on Torres and his salubrious impact: Any savings resulting from leaving vacant the governmental affairs position will be minimized by Torres' travel and other expenses, which we assume will be relatively high and involve multiple trips to the nation's capital.

Fresh Comment

Lawrence Ebert has filed a comment on the "Sharing the Weath" item. Among other things, he says,

"An issue with the 'paying for things twice' viewpoint is that the costs of 'making the invention' (the research and patenting costs) are generally DWARFED by the development/marketing costs. If someone can't get return on THOSE costs, they won't invest."