CIRM Eyes Three Firms for $200,000 Lobbying Job

The California stem cell agency has not yet made a decision on which of three firms to hire as a $200,000 lobbyist to promote a $10 billion aid package for the biomedical industry.

Don Gibbons, chief communications officer for CIRM, said proposals have been submitted by Van Scoyoc Associates, Hogan & Hartson and The Podesta Group.

The stem cell agency was on a fast track to hire a lobbyist, perhaps as early as last Friday, but Gibbons said that no decision had been made as of Monday.

Van Scoyoc is a Washington, D.C., firm whose web site says,

"We have been a central player in the multi-year effort to double funding for the National Institutes of Health, the National Science Foundation and the Centers for Disease Control and Prevention."

Wikipedia says the firm is 'the largest and most prestigious independent government affairs firm in Washington."

Hogan & Hartson is an international law firm with 1,100 lawyers and offices in both San Francisco and Washington. According to Wikipedia, it is "recognized for excellence in its life sciences and technology practice."

The Podesta Group's clients include Amgen and Genentech. Its principal, Tony Podesta, is "ranked as the the third most influential lobbyist in Washington," according to Wikipedia.

Klein: Federal Backing Could Lead to $1 Billion CIRM Loan Effort

Chairman Robert Klein of the California stem cell agency is proposing that the Obama administration provide loan guarantees that he projects would allow the Golden State to mount an ambitious $1 billion lending program for the biotech industry.

He broached the proposal at a Nov. 19 meeting of the Finance Subcommittee of the CIRM board of directors and plans to bring it up at a special teleconference meeting of the full board on Monday.

Klein's plan would double the size of the proposed $500 million CIRM loan program that is his brainchild. The board of directors is yet to sign off on details of the plan, which have not yet been fully worked out.

The $3 billion state stem cell agency itself has no apparent financial problems, although the state is in the midst of a $28 billion budget crisis. The voter-approved law that created the agency guarantees a steady stream of cash that cannot be touched by either the governor or the legislature. But Klein believes that the federal guarantees would help the lending effort.

At the Finance Subcommittee meeting earlier this month, Klein noted the trillion-dollar bailout figures floating around in the nation's capital. According to the transcript, he said,

"In terms of our financial interest, the loan guarantees that are being considered for a number of sectors of the economy could include the biotech sector.

"And here, if there were a 50-percent loan guarantee provision for governmental loan biotech programs, it would mean that if we had allocated conceptually, and only conceptually, because it's subject to approval of every loan at that time at the board level, but if we conceptually approved a $500 million allocation for a loan program and there were a government program for 50-percent guarantee, we'd have the possibility, subject to a lot of detailed work and legal review, to create a billion dollar program with that. So it would substantially expand our capacity for funding."

Klein brought up the proposal to seek "early input" from CIRM board members. However, the Finance Subcommittee ran out of time and adjourned without discussing the matter. He asked board members and the biotech community to send comments to him.

Klein is also seeking to lobby the Obama administration on other biotech industry matters. They include removing unspecified small business loan restrictions, expanding the FDA staff and substantially increasing funding for NIH grants.

On the restriction issue, he said,

"I believe it would be beneficial if some of those restrictions were changed to make it more possible for companies that have received venture capital funding in the past to get SBIC (Small Business Investment Corporation) loans because with falling stock prices, doing another round of stock offerings is not feasible unless you're going to hedge funds, which are extraordinarily difficult to deal with and create tremendous pressure on these small companies to the extent hedge fund money is available at all."

Klein said a substantial increase in FDA staff is needed to avoid a "choke point" on moving stem cell therapies into the clinic. He said,

"Everyone is going to need expert advice on exactly what kind of data and what kind of preclinical work is going to be required for an IND to be approved for a phase I human trial. That advice is required three years or more in advance because this is an innovative area. And so it's going to be an early priority with a lot of lead-time importance to get FDA expansion that can deal with cellular therapies as they advance."

CIRM has not yet provided written background on Klein's proposal on its Monday agenda, which also includes a plan to help ease the problem of absenteeism at board of directors meetings.

The public can listen in and participate during the teleconference meeting from locations in San Francisco (2), Los Angeles (5), La Jolla (3), Elk Grove, Sacramento, Pleasanton, Berkeley, Menlo Park, Healdsburg, San Carlos, San Diego, Irvine (2) and Duarte. You can find the specific addresses on the agenda.

CIRM Surfaces in Lobbying Article

The California stem cell agency popped up in a recent piece in the Harvard Political Review discussing lobbying in Washington, D.C., particularly that of Big Pharma.

The article noted that as of 2004 the pharmaceutical industry employed nearly 1,300 lobbyists in Washington, D.C., about twice the number of elected officials in the House and Senate. Of course, those lobbyists are vastly outnumbered by regulators. The piece also noted that Pharma spent $128 million in 2004 to push for tax breaks. That was about four times the amount spent that year on behalf of Prop. 71, which created the stem cell agency in California.

Stem cell research, the article said, has "arguably caused the greatest controversy." That where the article's authors, Alex Lavoie and Richard Kelley, brought in CIRM.

"Dale Carleson (sic), chief communications officer for the California Institute of Regenerative Medicine, said in an interview with that HPR that “a change in federal policy severely limits stem cell research,” giving scientists a strong incentive to try to influence the policy-making process. Carleson’s California Institute of Regenerative Medicine is the state government agency responsible for managing the three billion dollar investment in stem cell research, a result of Proposition 71, passed by the California Legislature in 2004 after heavy lobbying from interest groups. Government funding is, according to Carleson, “essential, especially to basic and preclinical research. Between the government and private foundations, most of them devoted to a specific disease, that’s the life blood of stem cell research.” Without funding from the government, stem cell research would suffer greatly, and without information and encouragement from lobbyists, the government might never support research in the first place."

The article went on to point out the cost of lobbying is prohibitively expensive for many groups, meaning a tilt towards those who can pay to be heard. At the same time, the piece said, that it is hard for lawmakers to separate the national interest from constituent interest from industry interest, which, we should note, can overlap significantly. "Unbiased advice is hard to come by," the article said.

CIRM has not yet really felt the impact of lobbying. At our last check, no lobbyists had been registered in Sacramento as attempting to influence the agency. A few firms and associations have spoken out on some issues, particularly IP. But that is likely to change as the coffers open wider at the stem cell agency.

(Editor's note: As most of you know, the Harvard item erred when it said the California agency was created by the legislature. It was created by a ballot measure that carried language that virtually immunized the agency from legislative influence.)