Comments from Maria Millan, CIRM CEO
"We view this initial payment as a 'mile marker' and not the destination. It is a good sign that we are going the right direction to a worthwhile destination - treatment and cures for patients with unmet medical needs. The royalty payment is only a piece of the intended return to California. The true return is in treatments & cures and the alleviation of human suffering and the mitigation of the financial burden of the multitude of diseases that CIRM is targeting."
Are there any other royalty possibilities in the pipeline for the next 12 months?
"Once there has been a cheque it means the grantee licensor has exceeded the $500,000 exemption so any subsequent payments to them trigger additional payments to the state. As regards future payments we have already identified another potential payee and are working with the grantee on the calculations involved in determining payment."
What time period does that royalty cover? In other words how long has the licensing been in effect, if that is the proper way to look at it?
"For this particular payment from City of Hope this covers 4 license agreements over the last 2 years."
Is there anything else that CIRM wants to add to shed more light on this subject?
"It wasn’t anticipated that revenue sharing would repay the $3b given to us to fund stem cell research in California. The only way that would have been possible is to demand such a high return from any funding we offered that very few companies would be willing to take the money. It would have completely undermined our mission of accelerating stem cell therapies to patients with unmet medical needs. It's also worth noting that an independent Economic Impact Report prepared in 2008 predicted that these kinds of payments would take many years to appear, even saying: “For example, tax receipts were modeled to commence shortly after funding under the proposition began, while improvements in health were modeled as becoming possible in as few as five or as many as 15 years, and receipts from intellectual property only beginning in the latter half of year 14. So, we are on track for where experts predicted we would be."
