Ortiz Calls for More CIRM Accountability

The most influential California state legislator on stem cell issues appeared to agree with much of the criticism of CIRM in today's report card, but stopped short of calling for the resignation of its chairman.

Here is the text of the statement by Sen. Deborah Ortiz, D-Sacramento, chair of the Senate Health Committee:

“It is critical for all of us who supported Proposition 71 and its promise of cures for debilitating and chronic diseases and conditions to have confidence that the grants are awarded fairly and productively, and that California’s $3 billion to $7 billion investment is protected.

“While the California Institute for Regenerative Medicine has taken steps toward addressing concerns about public accountability and open government, they are not enough. The CIRM must adopt stronger standards for disclosure of conflicts of interest, including prohibiting the institute’s president from waiving such disclosures at his discretion. CIRM also must narrow its exceptions from open meeting and public records laws to allow greater disclosure about grant applications that are funded or rejected.

“The CIRM also must adopt regulations to protect patients who donate embryos for research, and take strong steps to protect the pocketbooks of Californians by ensuring taxpayers receive a financial return on their investment in stem cell research that is consistent with the wording of the initiative and the promises that were made during the campaign.

“I am committed to reintroducing vetoed legislation to protect women who donate eggs for research by requiring full disclosure and written consent regarding possible adverse health risks associated with the procedures. I also am committed to moving legislation to further open up the deliberations of both the CIRM and the Independent Citizens Oversight Committee, guard against conflicts of interest and ensure Californians receive a fair return on their investment and that medical cures created through this taxpayer-funded research are made available to Californians at affordable prices."

Quick Look at Coverage of Stem Cell Report Card

The Sacramento Bee moved quickly today to post a story on the call for the resignation of stem cell chairman Robert Klein. The story came about one hour after the end of the conference call with reporters from across the country.

Some of the media outlets represented during the call were the predictable California outlets. But Newsday, Reuters and the Bureau of National Affairs were represented as well. The Reuters report was not available via the Internet at the time of this writing.

We will carry an item Thursday on news coverage of the report card on CIRM. Meanwhile you can find the story by Bee reporter Laura Mecoy by clicking here. Her story should receive some national attention as well because it is budgeted as part of the Scripps Howard News Service.

CGS: CIRM Turns in Mediocre Performance; Klein Should Quit

The Center for Genetics and Society Wednesday gave the California stem cell agency a mediocre "C minus" grade and called for the resignation of its chairman, Robert Klein.

The 32-page report card by the Oakland-based watchdog group said, "CIRM's first year has been a great disappointment."

"In terms of governance, the CIRM has often failed to operate as an accountable,responsible, and transparent state agency. In the area of politics, it has failed to establish a cooperative relationship with state legislators. And in the policy arena, the CIRM has fallen far short of the expectations raised during the initiative campaign that led to its creation: It has so far failed to adopt policies to ensure that any successful stem cell therapies will be affordable to most Californians, or to reassure Californians that they will see any share at all of financial returns that the research they are funding may generate," CGS said.

In response to our inquiry, CIRM spokeswoman Nicole Pagano said the agency had a "great first year."
Her statement (the full text follows this item) said,

"This is the kind of criticism-based activism that seems designed more for publicity than any practicable purpose.

"They have been working against Proposition 71 since the beginning, despite the overwhelming support of voters in California who approved the measure well over one year ago.

"Their report rehashes old issues that they have already expressed to our board; which they have duly considered and addressed."

The center is a nonprofit group based in Oakland that supports embryonic stem cell research. Members of its staff have regularly attended meetings of the agency and its subcommittee during the past year, testifying about the center's concerns.

The center gave CIRM "D" grades in the following areas: "maximizing health equity," minimizing conflicts of interest, cooperating with the state legislature, providing responsible leadership. The agency received its best grades – "C plus" – for establishing ethical safeguards and research standards and protecting women who provide eggs for research and other research subjects.

Klein came in for considerable criticism by CGS:

"…(Klein) has misused his authority in ways that have significantly undermined trust and confidence. His missteps and arrogance have been widely noted. The editorial page of the Sacramento Bee, for example, has dubbed Klein the 'self-appointed czar' of the stem cell research program and a 'rogue operator.'"

Marcia Darnovsky, associate executive director of the center, told reporters during a conference call that Klein had operated CIRM "more like a private enterprise than a public agency."

Another CIRM critic commented on the call for Klein to resign. John Simpson, stem cell project director for the Foundation for Taxpayer and Consumer Rights of Santa Monica CA, said:

"I certainly understand the public outrage that led to the call for Bob Klein to step down, but the stem cell institute's problems go beyond personalities. We'll just have a revolving door of Bob Kleins until the structure is fixed. Fixing the stem cell institute requires two things: First, it needs to follow all of California's good government laws and behave like any other state agency. Second, the institute needs to adopt rules controlling ownership of any Proposition 71-funded medical discoveries that are based on the foundation principles of affordability, accessibility and, accountability."

Today's CGS report card cited the built-in conflicts of interest at the agency and noted the coziness of such arrangements:

"The relationship between the ICOC (CIRM's board of directors) and the institutions it funds can be seen in the first round of training grants, announced on September 9, 2005. Of the 16 institutions that were awarded almost $40 million, 14 are represented on the ICOC. Viewed another way, all but two of the 17 ICOC members affiliated with an institution eligible for this round of funding saw their institutions receive grants."

On the "health equity" issue, the report said,

"To date, CIRM leadership has resisted the inclusion of affordability and accessibility of stem cell treatments as a key criterion in its policy considerations."

It said CIRM "could require that any successful therapies developed with its money be made available to the state’s medical insurance programs at reduced or no cost. Or it could require grant recipients to set aside a portion of any IP revenue in an accessibility fund."

CGS said CIRM has put in pace stem cell research guidelines recommended by the National Academies, but those are inadequate in some areas.

During the conference call among reporters, CIRM officials noted that while CIRM can set standards for only the research it funds, there are no state or federal standards for stem cell research. They suggested that the state legislature and CIRM work together to develop consistent standards.

CGS also gave CIRM a "C plus" for protection of women, but noted that there are no provisions for helping women egg donors who suffer serious side effects from the egg donation process.

The center's report said that CIRM faces "regulatory challenges never previously confronted by any other public body in the United States."

"While some of its difficulties may be 'start-up' problems that might be expected in any effort this large, the greater bulk are the result of numerous missteps and misjudgments, resistance to legislative and public oversight, and a tendency towards arrogance in the face of criticism."

It continued:

"We believe it is incumbent upon the CIRM’s leadership, staff, and board to enter the institute’s second year with a new spirit, one that acknowledges—in deeds as well as words—the need for transparency, accountability and public oversight."

Text of CIRM Response to CGS

Here is the full statement from CIRM, which is not expected to be available on the Web, in response to the CGS report card.

"This is the kind of criticism-based activism that seems designed more for publicity than any practicable purpose.

"They have been working against Proposition 71 since the beginning,despite the overwhelming support of voters in California who approved the measure well over one year ago.

"Their report rehashes old issues that they have already expressed to our board; which they have duly considered and addressed.

"We feel we've had a great first year and here are the reasons why:

* 56 public meetings-all with opportunities for public response
* Appointment of ICOC and three working groups that include
nationally recognized leaders in the fields of grant review, stem cell research, and ethics
* Adopted NAS Guidelines for Human Embryonic Stem Cell Research
* First grant review and approval of the CIRM Training Grant
Program that will train nearly 200 fellows at 16 institutions statewide.
* Scientific Meeting in October that featured presentations by
stem cell researchers and clinicians from the United States as well as Australia, Canada, Israel, Sweden and the United Kingdom.
* Received $18 million in office space and incentives from the
city of San Francisco

"We have equal enthusiasm for 2006:

* At the end of January our Standards Working Group will finalize their draft to send to the ICOC. Building on the NAS Guidelines, this document will establish the medical, ethical, and scientific standards for CIRM funded research. This document is the first state or national regulation of its kind and it represents a scientific and ethical blueprint for how stem cell research ought to be conducted. With the ICOC's approval, they will undergo the APA process and become formal regulations with the force of law in California.

* Bond Anticipation Note funding our training grants and a smaller research grant

* Planning for a May Scientific Conference examining the risks of Egg Donation; to be co-sponsored by the Society for Gynecologic Investigation

* Strategic planning for the long range funding"

Coming Up

The Center for Genetics and Society has issued a critical report card on the California stem cell agency. Its recommendations include a major personnel change at CIRM and stiffening conflict-of-interest standards. We will have an item on the recommendations shortly.

IP Report: More Sharing of Stem Cell Research Results

California should take steps to share its stem cell research tools and require stem cell grant recipients to provide a plan for managing their inventions for the benefit of California, the final intellectual property report of the California Council on Science and Technology says.

The general thrust of the final report seems similar to the interim report last summer with some modifications. It also seems aimed at meeting some of the complaints about how the existing Bayh-Dole model has stifled wide dissemination of research.

Here are the key findings:

"We recommend four general principles for the state’s IP policy:
"The policy is consistent with the federal Bayh-Dole Act.
"The policy creates incentives for commerce in California from state-funded research to the greatest extent possible.
"The policy encourages timely publication of results to diffuse knowledge widely, and provides guidance on the kinds of data that are desired to be placed in the public domain or available under open source, Creative Commons, or other broad-use licenses, including software and special databases.
"Requires diligent commercialization of IP-protected technology into products that benefit the public.
"With these principles in mind, we recommend that the state develop IP policies that accomplish the following:
"1. Permit grantees to own IP rights from state-funded research.
"2. Where appropriate, require that grantees (institutions, individuals, or both) provide a plan describing how IP will be managed for the advancement of science and benefit to California.
"3. Grant basic research funds without requiring that grantees commit to providing a revenue stream to the state. If, however, a revenue stream develops over time, require that revenues be reinvested in research and education.
"4. Generally, make state-developed research tools widely available to other researchers.
"5. Require diligent efforts to develop state-funded IP into applications and products that benefit the public.
"6. Retain within the state Bayh-Dole-like “march-in” rights if the owner of IP is not undertaking appropriate steps to transfer or use the technology to benefit the public.
"7. Leave license particulars to the owner who is in the best position to judge how best to ensure that discoveries are made widely available through commercialization or otherwise.
"8. Reserve the right to use IP by or on behalf of the state for research or non-commercial purposes.
"9. Establish and maintain state-administered functions to track all IP generated through state funding."

Big Boost in Funding for CIRM

The California stem cell agency has picked up another $5 million from a wealthy San Francisco Bay area couple, the San Francisco Examiner reports.

Writer Maria Lagos quoted stem cell chairman Robert Klein as saying the money is coming from Herb and Marian Sanders via their charitable foundation. She also said Klein has raised a total of $40 million, but declined to disclose details.

He made the disclosure in a speech to about 75 persons at an event hosted by the San Francisco Planning and Urban Research group. CIRM has no information on its web site concerning the funds.

It was not clear whether the money is coming as straight donations or as bond anticipation notes. In either case, it would be a major step in solving the financial difficulties facing CIRM.

The Sanders are co-chairs and co-CEOs of Golden West Financial Corp. of Oakland, the parent of World Savings Bank.

IP Advisory

Given the time of day, it does not appear that the stem cell IP report by the California Council on Science and Technology will be forthcoming today. We will carry an item when it is available.

Coming Up

The California Council on Science and Technology is scheduled to release its final report on intellectual property and stem cells later today. We will have an item on it when it becomes available.

LA Times on Cirm: Disappointing, Arrogant, Unresponsive, But Promise Remains Strong

The Los Angeles Times today editorialized about the California stem cell agency, declaring that its first year was "especially disappointing."

The Southern California piece was one of three articles that surfaced this morning dealing with CIRM, including one in Oakland and another critical op-ed piece in the Baltimore Sun.

The Times said CIRM has been arrogant, unresponsive and intransigent at times.

Nonetheless, the newspaper wrote, the promise of the agency "remains strong" and could be strengthened even more with beefier standards for ethics and accountability.

"But the oversight committee's chairman, Robert Klein, seems to be allergic to sunshine. Much of the committee's first meeting had to be scrapped when a public-interest lawyer pointed out that it failed to meet the state's open-meeting laws. The institute's first employees were drawn from the Proposition 71 campaign and Klein's stem cell charity group, ignoring the state's civil service rules on advertising for the most qualified candidates," the newspaper wrote.

"Unfortunately, the oversight committee continues to insist that members of the working groups, including the research reviewers, do not have to publicly reveal their financial interests in stem cell research. The members of these boards will make crucial recommendations about how to spend billions of taxpayer dollars, and for the public not to know whether they stand to benefit from any particular grant is unacceptable.

"The committee does stipulate that members of the working groups reveal their conflicts of interest to the committee itself, but that is inadequate. The world of stem cell research, industry and advocacy is too incestuous for such an arrangement."

Sounding a harsh note in Maryland was an opinion piece by Richard Hayes, executive director of the Center for Genetics and Society in Oakland. He focused on implications of the Hwang affair. But the article also said, concerning Proposition 71,

"It entrusted control of the money to a new state agency dominated by the very institutions that stand to receive the research grants. It exempted the agency's most important policy committees from California's open meetings and conflict-of-interest laws.

"It failed to guarantee the safety and health of women who provide eggs for cloning research. It contained no provisions to ensure that intellectual property arrangements would benefit the people of California. And late last year, it was revealed that real estate millionaire Robert Klein, the prime author and funder of the initiative and the current chairman of the program, knowingly misrepresented its likely full cost to California voters by perhaps $1 billion.

"What's going on here is both a very old story and a very new one. The old story is the drive for fame, fortune and power and the willingness of some people - in this case, scientists and biotech entrepreneurs - to put their personal drives and ambitions above the common good.

"The new story is the immensity of what is at stake. The new human genetic technologies are giving scientists the power to change the nature of human life forever. They are being developed at breakneck speed. Neither public understanding nor governmental oversight has been able to keep up. Scientists and biotech corporations are playing to our deepest desires and fears in their effort to secure the commanding heights of the technology, the law and the market."

Reporter Rebecca Vesely of the Oakland Tribune reported on the progress of the agency and its plans for the next year. Her straight-forward piece covered much of the same ground as an article last week by Terri Somers of the San Diego Union Tribune.

CIRM and Stem Cell IP Hearings: A Cold Shoulder to the Public

Only four business days remain before the California stem cell agency takes another crack at who will benefit economically from inventions developed as the result of the $3 billion in taxpayer-supported research.

This is one of the major issues for CIRM this year. It is also the subject of separate legislative proceedings, including a proposed constitutional amendment, SCA13, by State Sen. Deborah Ortiz, D-Sacramento, that is on the floor of the State Senate. What California does this year will have an impact across the nation as other states also consider whether existing models for sharing the wealth are doing the job.

Despite the importance of the issue, no background material or proposed drafts of regulations can be found in the agenda of CIRM's Intellectual Property Task Force, as posted on the Web at the time of this writing. It simply says, "Consideration of draft IP Policy." Amazingly casual for a matter that could involve billions of dollars.

No draft of proposed regulations, much less a synopsis of what is under consideration. No explanation of whether the entire issue is on the table or whether particular subsets are to be considered. No links to previous material on the CIRM web site, which could have easily been done.

The scanty agenda of the IP task force is no exception. Generally, little or no material is available in a timely manner in advance of CIRM meetings. That makes it virtually impossible for interested parties or the public in general to prepare thoughtful comments on some very complex and important issues. All they have is three minutes at the end of the meeting to make some off-the-cuff observations. Even some members of the agency's Oversight Committee have complained about not having enough time to review agenda material because it is so tardy.

A cynic would conclude that CIRM is not interested in keeping affected parties even partially informed. Our opinion is that this is another example of the chronic cold-shoulder CIRM gives to much of its public disclosure responsibilities. The agency began business like this 12 months ago. Then it could be contributed to start-up problems. But it is past time for CIRM to fulfill its promise of adhering to highest standards of openness and transparency. Even small school districts in California do a better job of making their agenda material available online in advance of meetings. An agency that proposes to give away $3 billion must do better.

There is a new fillip to the task force's meeting, however. It will be accessible to the public in New York City at the Carlyle Hotel. One of the task force's members, former Hollywood executive Sherry Lansing, will be staying at the hotel and is going to participate via an audio hookup. The Carlyle describes itself as a "purveyor of privacy and a sanctuary of refined taste," but a CIRM official assures us that the public will be permitted to listen in on the deliberations. They also are likely to be allowed to speak during the public comment sessions.

The actual session of the task force meeting will take place at Stanford University. Other offsite locations for the 1 p.m. Jan. 23 session are in Elk Grove near Sacramento and UCLA. Specific room numbers are available in the agenda. We will carry the room number for the Carlyle when we receive it.

Additional material for the agenda may be posted by CIRM by this Friday. But for those of you who simply can’t wait, here are some links that will help to understand what CIRM is getting at. We should note that nearly all of the CIRM material comes from postings weeks after the date of the events. Moreover, even the text of CIRM's interim IP policy on training grants, approved more than a month ago is still not available online.

The transcript of the Dec. 6 meeting of the Oversight Committee. Discussion of IP begins on page 96.

The full transcript of the IP Task Force meeting Oct. 25.

The full transcript of the Nov. 22 IP Task Force meeting.

The full text of the National Research Council’s report: Reaping the Benefits of Genomic and Proteomic Research: Intellectual Property Rights, Innovation, and Public Health (2006). This is recommended reading by the chairman of the IP Task Force, Ed Penhoet.

Interim report on stem cell IP by the California Council on Science and Technology.

Draft of the interim policy for IP training grants presented at the December meeting of the Oversight Committee. This was approved with some slight modifications. The text of the approved policy is not available online at the time of this writing.
A host of material from the Oct. 31 hearing by Sen. Ortiz into intellectual property, including the transcript, background on Bayh-Dole and alternative intellectual property models.

Statement and testimony by the Center for Genetics and Society on CIRM Intellectual property policies.

Statements by the Foundation of Consumer and Taxpayer Rights on CIRM intellectual property policies.

The task force is composed of persons drawn from the CIRM Oversight Committee. They are: Edward Penhoet, chair; Susan Bryant, Michael Goldberg, Sherry Lansing, Ted Love, Philip Pizzo, Francisco Prieto, John Reed, Jeff Sheehy, Oswald Steward and Janet Wright.

Big Stem Cell Soiree Scheduled For San Francisco

If you want to pay $1,495, you can hear California stem cell chairman Robert Klein and CIRM president Zach Hall speak at The Stem Cell Meeting March 12-14 in San Francisco.

The Stem Cell Meeting (yes, that is its title) is being produced by Burrill & Company, a San Franciso life sciences merchant bank with more than $500 million under management.

Hall and Klein are among a host of impressive folks, including two representatives from Congress and biotech business execs and researchers, scheduled to appear at the conference at the Palace Hotel.

If you are interested in being one of the top sponsors of the conference – a $45,000 privilege – it looks you are probably too late. Only three were available and those slots seem to have been sold, based on what we saw on the web site for The Stem Cell Meeting.

If you want to see Klein and Hall in action for free, check them out at the next meeting of the CIRM Oversight Committee Feb. 10 in at Stanford.

It has always struck me as odd that public officials appear at gatherings that effectively bar the public from hearing them. However, it is not an uncommon practice.

New Stem Cell Links Added

We have added two new links to those carried on this blog. One is to the stem cell page of the Foundation for Taxpayer and Consumer Rights. The Santa Monica organization has a number of interesting items, including an analysis of CIRM's interim policy on intellectual property and a look at the conflicts of interest of the agency's Oversight Committee.

Also added to the links is the blog of the editors of the American Journal of Bioethics. The site is wide-ranging but includes interesting commentary and information on many of the issues confronting CIRM, although they may not relate them specifically to California. Its coverage of the Hwang scandal is especially useful.

We encourage you to take at look at the sites. Please send us suggestions for other sites that may be of interest to readers of these pages. You can do so by clicking on the word comments at the end of this item – it permits anonymous posts – or by sending a message to djensen@californiastemcellreport.com.

The Financial Message on Stem Cell Research

For the ethically challenged, a couple of business news outlets have pointed out another good reason for high stem cell research standards – money.

Without confidence in the research and its results, both big and small investors will shy from coming up with the cash that is necessary to turn research into therapies that will cure millions and generate billions in profits.

Both Business Week Online and Bloomberg News carried pieces on the financial impact of the Korean fraud.

The headline on the Bloomberg article, prepared by Heejin Koo and William Sim, said, "Fake Stem Cell Research Work May Cost Korean Industry Billions." The article noted that Hwang's research was once estimated to be worth $34 billion to the Korean stem cell industry by 2015.

Reporter Arlene Weintraub of Business Week Online wrote that the unsettled state of stem cell research has:

"...kept most venture capitalists away from anyone with the phrase 'stem cell' in their business plan. When the Korean scandal started erupting in December, shares of ACT(Advanced Cell Technology Inc.) fell 16 percent and rival Geron Corp. (NasdaqNM:GERN - News) tumbled 4 percent, despite the fact that interest in biotech was strong and the Amex Biotech Index was up 6 percent in the same period. Korea 'is just another body blow,' says ACT investor William Woodward of Santa Monica (Calif.)-based Anthem Venture Partners."

The piece noted the financial importance of articles in scientific journals.

"Geron's recent history reveals how much is at stake. On Sept. 1, the Menlo Park (Calif.) company announced that cardiac-muscle cells derived from human embryonic stem cells survived and multiplied in the hearts of rats, suggesting the cells might someday be useful for treating cardiac disease in humans. The research was published in the American Journal of Pathology. Geron's stock immediately traded up 3 percent to $11.20, on four times its normal trading volume. Such share-price bumps have allowed the company to go back to investors in a position of strength: It now has $200 million in cash and no debt."

Not mentioned in the Business Week piece was Geron's performance recently during the greatest attention to the Korean scandal. Geron's share price was $9.53 on Dec. 12. Since then it has dropped to $8.52 on Jan. 13.

Weintraub also wrote that the shaky state of commercial funding of stem cell research has led to some "contortions."

"When ACT decided to raise money by going public last year, investment bankers were so uninterested that the company opted instead to reverse-merge into a shell company that once made Hopi Indian dolls. It wasn't quite as splashy as an initial public offering, but the symbolism was perfect: The dolls represent ancestral spirits to whom the Hopis pray for rain and other gifts. New shares in hand, ACT raised $18 million from hedge funds and other risk-taking investors -- enough to carry the company into 2007. But the spirits didn't smile on this stock, which fell from a high of $7 to a recent $1.90 a share."

Nonetheless, Lanza still has a Hopi doll of a red-tailed hawk in his office.

California Stem Cell Research: Hype, Folly and Contempt?

If you believe a Washington Post editorial and an op-ed piece in the San Francisco Chronicle this weekend, California should fold up its stem cell research rather than capitulate "to "the unholy lust of scientists."

Citing the Korean scandal, self-described "professional philosopher" David S. Odeberg called for separation of science and state in his piece in the Chronicle.

"How could the millions thrown at scientists be anything other than a veritable inducement to misconduct? When you combine it with the innumerable honors and awards that await the next would-be secular savior of humanity, one wonders that fraud is not even more common than it appears to be," he wrote.

Odeberg, professor of philosophy at the University of Reading, England, continued:

"It would be an act of utter folly and of contempt for honesty and integrity were Gov. Arnold Schwarzenegger's beloved California Institute for Regenerative Medicine now to go ahead."

The Washington Post, whose editorial was carried on some California websites, also noted the pressures on scientists to overstate their results. But its main argument was that states are a "bad place" to conduct stem cell research because it would be politicized at the state level.

"In California, universities already are hiring scientists and building labs, even though lawsuits have prevented the state's $3 billion funding program from issuing any grants. This kind of hype makes it particularly difficult for states, which do little basic research funding, to judge the value of individual stem cell research projects."

The Post did not mention that the reason states are seeking to fund embryonic stem cell research is because of the President's own politics and personal beliefs and the political gridlock in Congress on the issue.

Bioethics Blog Disagrees with CIRM Exec

The editors blog of the American Journal of Bioethics does not agree with the position of Zach Hall, president of CIRM, that peer review can prevent a Korean-type scandal in California.

Here's the key quote:

"This from the guy who is giving out the money. Oversight is the key to giving the money out responsibly. It is one of the reasons why we should give government funding in the first place. California has become the standard-bearer for state-based biotechnology research funding…."

This would be okay, "but not if the standard-bearer claims that fraud is best prevented by peer review."

Chronicle: CIRM Needs Careful Regulation

The San Francisco Chronicle said today the Korean stem cell scandal is a “cautionary tale” that shows that the California stem cell agency needs additional public regulation.

The editorial in today’s paper said:

"What is to prevent similar fraud and ethical lapses from happening here in California, where voters agreed to spend $3 billion on stem-cell research?
"'Scientists,' responded Zach Hall, president of the California Institute for Regenerative Medicine, the funding entity created by Prop. 71. Warning that every industry has the potential for an Enron, Hall touted the American system of peer review as the best way to expose rogue scientists and bad science and to keep research-funding decisions apart from undue political, religious or geographic influences. 'What will not stop this from happening is government oversight,' he said.
"In a world of 'pure' science, maybe. But stem-cell research is, at this point, anything but pure. Scientists rail about the 'political'interference in their work by the religious-right aligned Bush administration, but what was the campaign launched by the stem-cell research proponents to sell the stem-cell bonds, if not political? With business and political capital -- not to mention the state's image as a technological innovator -- on the line, the stem-cell institute needs oversight, both regulatory and scientific."

The editorial continued:

"Questions remain about the sourcing of the human eggs and about which avenues of research are best pursued with the taxpayers' money. Would voters embrace research that might require hundreds of human eggs to produce a therapy for a single person? If these rules are adopted, who enforces them? Are there punishments for infractions?
"These matters of great public concern should be subject to government regulation -- especially when taxpayers are picking up the multi-billion-dollar tab for this research."

New Money-Raising Effort at CIRM

The California stem cell agency began a new, $2 million fundraising drive yesterday to pay for such things as a national conference in May on the medical risks of human egg donations and how to reduce them, according to the San Diego Union Tribune.

Reporter Terri Somers quoted Zach Hall, president of CIRM, as saying the effort is aimed at financing “nongrant” scientific activity. Hall also said the agency is now focusing on creating a structure that will allow it to move quickly once litigation against it is resolved.

"We want to hit the ground running once the money comes in. Rather than sending out a slow and gradual stream of funding, the plan now is to let a torrent of funding flow like waters set free from a sluice gate."

Somers wrote that the “image of a torrent worries” Jesse Reynolds of the Center for Genetics and Society.

“He wondered if there was enough good science to warrant such funding at this time. But he was also somewhat comforted by the plan.
“Originally, the institute's leaders talked about making their first grants last May, which Reynolds said was ludicrous. To hear them now talking about having their organizational infrastructure in place first sounds better, he said.”

The latest fundraising effort is in addition to the $50 million effort to sell bond anticipation notes.

CIRM, Cibelli, Korea and The Bee

An official of the California stem cell agency is taking issue with a Sacramento Bee editorial that indicated that CIRM was not taking the Korean scandal sufficiently seriously.

The editorial referred to a meeting Dec. 1 of the Standards Working Group. At that time, the Hwang affair had not surfaced completely, but it was evident that extremely serious problems existed.

Bernard Lo, co-chair of the group and director of the UC San Francisco Program in Medical Ethics, said in his letter:

"Contrary to the assertion that we went 'out of our way' to avoid discussion of Hwang's difficulties, a review of the written record of the Dec. 1 meeting of this committee, posted on Dec. 12, demonstrates that the Korean developments were the catalysts for extensive discussion on egg donation. The result was numerous recommendations to prohibit the practices that sparked the Korean controversy. Further, we have developed enforceable rules that exceed existing state and federal guidelines to ensure that research is conducted safely and ethically."

A search of the 263-page transcript shows that the word "Hwang" was mentioned twice and "Korea" or variations of it popped up eight times. Obviously such a simple count does not measure the quality of the discussion. Korea did trigger some exchanges, and the group also discussed a wide range of ethical subjects, including the value of a woman's eggs.

One of the members of the standards group is Jose Cibelli, a reknown Michigan State University scientist. He is also a co-author of the fraudulent March 2004 paper by Hwang that reported the first-ever closed human stem-cell line. Cibelli was present at the December meeting and participated in the discussions.

Queried by the California Stem Cell Report, a spokeswoman for Michigan State said,

"Michigan State University is conducting an investigation into Dr. Cibelli’s role on the '04 paper, where he is listed as a co-author. The investigation was started at Dr. Cibelli’s request. Given the investigation, there won’t be any comment available. For more information on the process, see: http://www.msu.edu/unit/vprgs/level2/conductres.htm

We should note that CIRM officials have stated in the past that scientists are often reluctant to criticize their peers' work in public. It is one of their justifications for maintaining closed door reviews of grant applications.

California Pushing Ahead with Cloning ESC

From San Diego, where stem cells meet the surf(see "Science of Surfing"), comes a couple of stories dealing with the California stem cell agency and some of the California fallout from the Korean scandal.

Reporter Terri Somers of the San Diego Union-Tribune wrote in some detail about the plans of California scientists to jump into the field of cloning human embryonic stem cells. It was that effort in Korea that turned out to be frauduent.

But scientists in California aren't giving up, and they hope to secure funds from the California stem cell agency to pursue their work.

Somers wrote:

"My guess is that just about everyone who has a stem cell research center is going to jump into this," said Jeanne Loring, a stem cell researcher at the Burnham Institute in La Jolla.

"All of the California research institutes stressed that in moving forward, they will follow the latest and strictest ethical guidelines to avoid the lapses uncovered in South Korea."

Also weighing in from San Diego was Richard Murphy, president of the Salk Institute and a member of the Oversight Committee for CIRM. His op-ed piece in the San Diego paper was a reprise of CIRM one year later. He said:

"I am often asked when California's stem cell research is going to get off the ground. The answer is, we don't know. At the moment, state-supported human embryonic stem cell research is at a standstill, tied up in the courts by research opponents who are arguing that Proposition 71 is unconstitutional.

"But these opponents have not succeeded in preventing CIRM's employees from creating an impressive state-supported stem cell institute that is ready to spring into action once the monies flow. Government agencies are often targets for criticism, but Californians are getting more than their money's worth from this one."

IP, IP, IP and More IP

The website of the Health Committee of the California state Senate is awash in intellectual property – that is, information dealing with the multimillion dollar questions of who profits from research funded by the California stem cell agency.

The Health Committee is chaired by Sen. Deborah Ortiz, D-Sacramento, who is carrying a proposed constitutional amendment concerning IP and CIRM. So much of the information comes from her hearing last Oct. 31, including a transcript of the proceedings.

But there are additional links to to background information at the University of California, the NIH, the California Council on Science and Technology and alternative IP models. Also included is information from last March's hearing into implementation of Prop. 71 and a hearing on the measure prior to its passage in November 2004.

If you want to know what is going on with IP issues and CIRM, this is one of the places you need to check out.

Vaccine Advisory

For those of you who have been looking for the "sunshine vaccine" item, it has been reposted a couple of items below. It was inadvertently removed during a feeble attempt to fix some html coding errors.

Hwang Reaction: Research Needs More Care

In the first of what is likely to be a series of comments about the impact of the Korean stem cell fraud findings, a top Stanford researcher says they show that researchers must "work more deliberately."

Irving Weissman, director of the Stanford Institute for Stem Cell Biology and Regenerative Medicine, released a statement that included the following:

"With the dollars provided by California's Proposition 71, Stanford intends to recruit scientists who will find ways to do nuclear transfer research, first in animal models and then with human cells, using the safest and most effective methods.

"The Stanford Institute for Stem Cell Biology and Regenerative Medicine is committed to advancing the field through the creation of new stem cell lines, research to further understand stem cell biology and the development of treatments for disease. Proposition 71 will play a significant role in helping Stanford researchers as well as other California institutions achieve the full therapeutic potential of stem cells."

Weissman called the Korean scandal a "personal tragedy" for Hwang and his scientific colleagues.

"While the announcement is a disappointing setback for nuclear transfer stem cell research, we are all making significant progress in the fields of adult tissue stem cell research, embryonic stem cell research and cancer/leukemia stem cell research. We must work more deliberately on nuclear transfer stem cell research, but we must go forward ethically and responsibly, as the future potential applications for the diagnosis and treatment of human diseases using these tools is so great," Weissman said.

CIRM Promises Open Search on General Counsel

After we posted the item below, the California stem cell agency emailed the following comment on Bedford's position at CIRM.

"CIRM will engage in a full and open recruitment process for the position of General Counsel when our funds become available."

Update on CIRM's General Counsel: An Orrick Connection

The California stem cell agency may have found the man who will be its new general counsel once the money really starts rolling in.

He is Daniel R. Bedford who is working fulltime pro bono at CIRM while he winds up affairs at Orrick, Herrington & Sutcliffe LLP of San Francisco.

It is our understanding that Bedford will fill the general counsel slot at a later point, but neither he nor CIRM would confirm that. Currently CIRM has put a hold on new hiring because of its budget crunch.

Bedford is assisting "CIRM generally on its many legal matters," says Nicole Pagano, a spokeswoman for CIRM. "At the moment most of his time is devoted to helping CIRM put together its Grants Administration Policy and advising on internal governance questions."

According to Orrick's web site, Bedford focused his practice on complex asset-based and lease financing, with an emphasis on agribusiness, domestic and international project financing, and tax-advantaged leasing."

His work has included representation of John Hancock Life Insurance in areas concerning equity and debt direct private placements. Other clients included public transit districts and Banc of America Securities. Much of his work involved various kinds of debt, which would seem to be a good fit with the needs of CIRM in connection with the issuance of state bonds.

Bedford has also participated in complex negotiations for natural gas pipelines involving government agencies, both in the US and involving Argentina, Chile, Brazil and Bolivia. Orrick's site did not list any involvement with biotech firms.

Orrick is bond counsel to California, but Orrick's site does not show any work by Bedford for the state.

Bedford received a B.S., M.B.A. and J.D. from Stanford University, where he was a member of Phi Beta Kappa.

Time for a Stem Cell Sunshine Vaccine

The international scientific conference that was sponsored last fall by the California stem cell agency had an interesting sidelight that is now surfacing in the Korean research scandal.

It was in San Francisco at the time of the conference that Gerald Schatten, the University of Pittsburgh scientist who co-authored the fraudulent Korean stem cell paper, met with Hwang Woo-suk and asked for a 50 percent share of the patent, according to Merrill Goozner, director of the Integrity in Science project at the Center for Science in the Public Interest.

Hwang rejected Schatten's request. About six weeks later Schatten publicly broke with Hwang, helping to set in motion a string of events that culminated in Hwang's disgrace.

The rejected request by Schatten has been reported previously (Nov. 29), although we had not seen the location of the meeting. But as Goozner notes, it has received little notice in American media. Goozner also points to a story on Saturday by reporter Jennifer Bails of the Pittsburgh Tribune-Review, who wrote that Schatten "is seeking to patent technology to create embryonic stem cells without crediting his now-estranged colleagues in South Korea."

The 50-percent request is not the only allegation about Schatten that has received little scrutiny. Totally overlooked by most newspapers was a report Dec. 16 by Associated Press writer Paul Elias. He wrote that Schatten, who was listed as "senior author" on the Hwang paper, could also become a victim of the Korean scandal.

"At the very least, Schatten faces a formal reprimand once an internal school investigation is concluded," Elias said.

He quoted Arthur Levine, dean of Pitt medical school, as saying:

"One should only be the senior author of a scientific paper when one has prepared and was responsible for all the data in that paper. It also implies the senior author is the chief of the lab where the experiment took place."

Other allegations concerning Schatten have also received short shrift in this country. They include aKorean statement that Hwang rejected Schatten's request to serve as chair of the once-vaunted World Stem Cell Hub. Hwang also reportedly rejected a Schatten request for a payment of $200,000 to help start the US operations of the World Stem Cell Hub, according to Digital Chosun.

Schatten and Pitt have generally not responded to the allegations. Pitt is conducting its inquiry behind closed doors, a process Goozner called outrageous.

Bails wrote:

"The rush to file biomedical patents for early-stage technologies creates roadblocks to research that do a disservice to the public by requiring scientists to dish out licensing money whenever they have an idea that might be worth pursuing, Goozner said.
"'It sets up arbitrary financial roadblocks to research,' Goozner said. 'We need new systems that make these technologies open to all scientists at the lowest possible price, and when the government funds them, it should be the government insisting that's how they are managed.'"

In his blog, Goozner wrote that Hwang was also attempting to patent the same research without mentioning Schatten.

"Ownership disputes over key stem cell patents have been simmering since the field emerged in the late 1990s. The University of Wisconsin, whose researcher James Thomson used Geron Corp. funding to isolate the first embryonic stem cell lines, charges $100,000 to commercial concerns and $5,000 to academics for access to those lines. It also granted Geron exclusive rights to pursue therapies in the most promising fields. Last May, San Diego-based stem cell researcher Jeanne Loring told Nature magazine her start-up firm collapsed because it couldn’t get access to the Wisconsin patents at reasonable rates," Goozner said.

In the case of Hwang, however, one wonders why someone would want to patent bogus research results.

Aside from the San Francisco meeting between Hwang and Schatten, what does all this have to do with CIRM? Much of it goes right to the point of the hottest issues before CIRM this year. The agency, as well as the legislature, is in the midst of wrestling with the question of ownership of state-funded research results and sharing access to those results. The fallout is likely to build support for more sharing rather than less. The Korean scandal also reminds us that the stakes are huge and people are tempted by riches and fame. It tells us that more disclosure is better than less about the economic interests of those associated with the $3 billion California effort. Call disclosure a kind of sunshine vaccine. Without some protections such as could be provided by a pending state constitutional amendment, the CIRM program would not likely survive a scandal of even a fraction of the magnitude of the Korean affair.

Why Whales Migrate

When two U.S. scientists decided to take their research to Singapore last fall, one Stanford stem cell researcher called it a "loss for America."

The two are Neal Copeland and Nancy Jenkins. They left the National Institute of Cancer in Maryland and rejected a pitch from Stanford as well before deciding to depart for Asia.

They said they would have moved to California if funds were available from the state's stem cell agency. Writers Sara Webb and Mia Shanley of Reuters recently explored more of the couple's reasons for leaving the Home of the Free and the Land of the Brave. They included "restrictions on government funding for stem cell research, shrivelling grants and curbs on commercial spin-offs from their work such as consulting and other fees," the scientists told Reuters.

The news agency reported:

"'The amount of money going towards research is going down. It doesn't have a high priority (in the United States). In Singapore it does," said Copeland, adding that they would like to exploit some of their Singapore-funded research commercially.
"Copeland and Jenkins said they had been won over by Singapore's scientific freedom, deep pockets and interest in commercial applications, at a time when the U.S. government's National Cancer Institute in Maryland -- where they worked for 20 years -- began a clamp down on consulting work by its scientists."
The story continued:
"In an era where funding is critical -- even a microscope can cost half a million dollars -- wealthy Singapore has the money.
"That, say scientists, has been Singapore's attraction, along with speedy grant approvals and lack of burdensome paperwork.
"'We don't want to spend the rest of our lives writing grants,' said Copeland, adding that Singapore's quick access to funding was key. The couple's colony of 20,000 mice costs some $1 million a year to maintain."

Singapore is currently engaged in a major recruitment drive to attract top scientists – "whales"-- as part of a multi-billion dollar biomedical research effort. Last fall reporter Lisa Krieger of the San Jose Mercury News wrote about the couple's decision. Irving Weissman, director of Stanford's Institute for Cancer/Stem Cell Biology and Medicine, told Krieger:

"'It is a loss for Stanford and a loss for America,' Weissman said. 'Without a doubt, they are the best people I know to find out which genes are altered to cause cancer.
"'When they do their work, it will be for Singapore,' he said. 'They'll conduct their clinical trials in Singapore. The first place their work will be patented and used will be Singapore.'"

Studying the Science of Surfing

It's just like science say the biotech "dudes" who combine business and surfing in the Pacific Ocean near San Diego.

"In San Diego's booming biomedical industry, opportunity tends to come in waves — the kind found at La Jolla Shores or Black's Beach or Scripps Pier. Surfing has become a way to make contacts, get face time with the boss and arrange deals," wrote reporter Denise Gellene in the Los Angeles Times on Sunday.

They call them "board" meetings and report that "it's where the best business gets done." One surfer, Steve Mayfield, named his company, Rincon Pharmaceuticals Inc., after a surfing spot somewhat farther north on the California coast. Mayfield is also an associate professor of cell biology at the Scripps Research Institute.

Laura Shawver, chief executive of Phenomix Corp., said riding the waves has something in common with biotech.

"This is just like science. You must be very persistent. You can have spectacular wipeouts followed by the high of your life. And you are always looking for the next one."

We should report that we surfed a spot in La Jolla early in December but did not see any major stem cell breakthroughs or deals being hatched. But again it is about being in the right place at the right time.

California Researchers Forging Ahead with SCNT -- Among Others

Newsweek had something to say in its most recent edition (dated Jan. 16) on the impact of the Korean scandal on stem cell research in California as well as elsewhere.

Here are the most pertinent paragraphs in the item written Claudia Kalb and B.J. Lee:

"The Hwang debacle isn't stopping U.S. scientists. Nor are they starting from scratch. Somatic cell nuclear transfer (SCNT)—the technique Hwang claimed to have mastered in humans—has already been accomplished in mice. If researchers can move it to people, they say SCNT will allow them to watch complex diseases develop in the petri dish, spot problems and then test drugs to fix them.
"The procedure, which requires human eggs, is technically daunting and only a handful of U.S. scientists have said they have plans to try it. Three from Harvard, who specialize in diabetes and brain and blood diseases, hope to start experiments soon. The biotech firm Advanced Cell Technology, in Worcester, Mass., says it's moving ahead again after shutting down in the wake of South Korea's supposed advance. Stanford says it's recruiting scientists to work on the procedure. And last week, Larry Goldstein of the University of California, San Diego, went public, telling NEWSWEEK that he and several colleagues now plan to pursue SCNT as well. A politically active stem-cell researcher—he fought hard for California's $3 billion initiative—Goldstein wants to use the technique to focus on the genetic underpinnings of Alzheimer's: 'It's a unique approach to understanding disease.'"

Correction

On Jan. 4 in the "eggs and ethics" item, we made an incorrect reference to the "Center for Policy and Genetics." The correct reference is to the Center for Genetics and Society. We are told that we have done this in the past, much to our regret -- the error -- not the criticism. We can only attribute it to a synapse breakdown.

Our policy is to correct all errors. We do not want to repeat them. If you see a mistake, please call them to our attention by sending an email to djensen@californiastemcellreport.com. Or you can post it directly online by clicking on the word "comment" at the end of each item.

San Diego Voice: Don't Tar California Stem Cell Effort

From San Diego, one of the hotbeds for stem cell research, comes an appeal to the public to not paint California's efforts with a Korean brush.

The pitch was made by Elie A. Shneour, president of Biosystems Institutes, Inc. and research director of Biosystems Research Institute of San Diego

Writing in the Voice of San Diego, an online news outlet in that area, he said,

"California in general, and San Diego in particular are directly affected by the fallouts of this debacle. It has to do with damage to the credibility of the stem cell enterprise, and the trust of the public in the funding of scientific research. But it should not be."

He continued:

"What happened in South Korea unjustifiably reverberates in California, but it should not create one more unmerited impediment to an already charged situation."

Shneour went on to praise the work of the agency and said:

"Unfortunately, this grand project is now mired in legal conflicts generated by politically and religiously motivated antagonism that mirrors the resistance of Washington to stem cell research."

"Disappointingly, California, a state that has always been at the forefront of progress, is allowing the uninformed and the fearful to deny it the opportunity to take one of the first steps."

.

Wilson Cites Other Commitments

According to CIRM, Gayle Wilson left the Oversight Committee of the California stem cell agency because "her other commitments have shifted in the last year and she is unable to devote the full time and attention necessary to participate fully as a member of the ICOC."

That was the response from Nicole Pagano, spokeswoman for the agency.

Gayle Wilson Leaves Oversight Committee

Gayle Wilson, the wife of former California Gov. Pete Wilson, has resigned from the Oversight Committee of the California stem cell agency.

Wilson's resignation took effect last Sunday, according to a press release from CIRM. The statement said she will "continue to advise CIRM leadership on state and federal legislative matters." The reason for her departure was not disclosed in the press release, but we have a query into the agency.

Wilson was appointed to the board by Gov. Schwarzenegger as a representative to a committee slot for "an executive officer of a commercial life science entity." She is serves on the board of Gilead Sciences, as biopharmaceutical company.

Stem cell chairman Robert Klein said, "Her outreach efforts to fully inform the stem cell debate in Washington D.C. have been invaluable-especially in moving pro-stem cell legislation forward and with advancing a scientific understanding of stem cell research and its promise for treating chronic disease."

Wilson is the second person to leave the Oversight Committee. Phyliss Preciado left in the middle of 2005 to take a job in Oregon.

Eggs, Ethics and Cash: What about Singapore?

What is the price for a woman's egg? Is it more or less than a man's sperm? Is an egg worth more than the $30 paid to the donor of a pint of blood? Is it worth more than a kidney, for which the official price is zero?

Some of the questions that are being discussed by the California stem cell agency as it develops rules for securing eggs for its taxpayer-funded research.

Prop. 71 prohibits paying women to provide eggs, beyond direct expenses. But the agency is trying determine whether eggs can be used that come from sources outside of California that may involve some sort of additional payment. The Center for Policy and Genetics says that many members of the CIRM's Standards Working Group have "advocated seizing on a potential loophole in Prop. 71," asserting that "compensation for egg providers would be legal as long as the funds for these payments came from a source other than the CIRM."

The topic of cash-for-eggs came up at the group's meeting in December. The meeting received no coverage in the media but was attended by a staffer from the Center. The Korean scandal, which involved payments of $1,400 for a human eggs, was discussed during the meeting, although the flap was in its early stages.

The transcript of the meeting shows a free-ranging and loose discussion of some of the considerations involving the use of human eggs. Often in such discussions, the beginning question is phrased as "should we pay women to donate their eggs?" Rarely is it phrased as "should women be allowed to sell their eggs?" The different starting points could lead to different conclusions.

Here is a semi-random sampling of some of the partial comments from members of the Standards Group as carried in the transcript of the meeting.

Ann Kiessling, director of the Bedford Stem Cell Research Association and associate professor of surgery at Harvard Medical School

"I think that in the consenting process itself, you cannot establish guidelines for people in Singapore or other parts of the world who may actually view this as a way for women to get together and actually create a small business to donate eggs. I don't think that should be absolutely prevented. What you want to prevent is having somebody go through this procedure who was not fully informed and not doing it of their own free will."

Zach Hall, president of CIRM

"The question is do we want to exclude cell lines that are made by well-meaning, thoughtful, responsible people who happen to come to a different conclusion for whatever reasons than we do on this particular issue?"

Kiessling, again

"Lots and lots of women are going to be willing to do this because they're going to be willing to do it. It's going to be a select group. You are not going to recruit people who can't afford to take off two weeks to do it... Plenty of women...are going to volunteer to donate eggs because women do things like that. That's not the issue. The problem is whether you ought to accept lines from other parts of the world or other parts of the country that have different guidelines."

Marcy Feit, president of ValleyCare Health Systems

"(Say)there's a cell bank in Singapore. What assurances do we have that even if we get paperwork that says informed consent was given, how do we validate the process of informed consent? Many times cultures work under different understandings of processes than we do. And so I think we have to give really careful consideration to lines that were derived before our standards were set in. And I'm not saying I have the answer of how we're going to go about that because I hear the plea from the scientists that you really want to include as many lines as possible that are usable for research. But given that, the attack on CIRM would be vicious internationally if we accepted one cell line that wasn't properly handled in another country. So to validate that process, to really understand, as much discussion as we had this morning regarding protecting women, and we know what we want, how do we validate that with cell lines that were created prior to this understanding this morning?"

The discussion turned to the value of eggs in dollars and cents.

Kevin Eggan, assistant professor of molecular and cellular biology at Harvard and a founding member of the Stowers Medical Institute

"The problem here is that...eggs somehow lie somewhere between blood and sperm
and a kidney. "

Robert Taylor, associate professor of medicine at Emory University

"So I'm having trouble following this argument. So the liver donor gets nothing.The kidney donor gets nothing. The sperm donor get $75 or something like that.The blood donor who has probably a slightly higher risk of injury than the sperm donor, which I would say is probably relatively minimal risk last time I thought about it, gets compensated to the tune of $30. I'm just -- I'm starting to -- so cost and risk clearly are either dissociated or inversely related. I can't figure this."

The topic of eggs and ethics is expected to be revisited later this month at a two-day meeting of the Standards Working Group.

CIRM President On Cyberspace Airwaves Jan. 4

Set your Internet radio Wednesday Jan. 4 to Science and Society at 1 p.m. PST to catch the president of the California stem cell agency discussing the latest doings at the institute.

Zach Hall is scheduled to be interviewed on a program called Science and Society by David Lemberg. The program's website says it provides "direct access to primary sources of change in science and technology." It is also a public service of the Hopkins Capital Group, a St. Louis venture capital firm focusing on high tech health firms.

California Universities Not Waiting for CIRM Cash

California universities are plunging ahead with multimillion dollar stem cell programs despite the failure – so far – of the California stem cell agency to deliver on promised grants.

That's the report in the Los Angeles Times this morning by writer Rong-Gong Lin II.

According to the story:

"'We are … not waiting,' said Arnold Kriegstein, director of UC San Francisco's stem cell institute, which has also hired faculty and started preparing research facilities. 'We are moving ahead with what we can with private funding.'"

The Times said that UC San Francisco officials are using private fundraising to renovate about 7,000 square feet of lab space, expected to be ready in 10 to 11 months for new embryonic stem cell lines not approved by the federal government.

The story also said, however:

"Some (UCSF) researchers who had been eager to compete for grants for embryonic stem cell research have had to look for other sources of funding or areas of emphasis. Programs to train scientists in developing and maintaining human embryonic stem cells have stalled."

Here is the Times look at other schools:

"USC has lured a top scientist from the Australian Stem Cell Centre to head its new research institute and has committed $10 million this year to hiring faculty and renovating lab space." He is Martin F. Pera, whose lab was the second in the world to isolate embryonic stem cells from the human blastocyst, a developing embryo.

"UCLA has said it will spend at least $20 million over five years to recruit scientists and set up laboratories. It has already hired three young researchers for faculty positions, two from Harvard University and the other from Massachusetts Institute of Technology." The Times identified three of the hires as Hanna Mikkola, who is focusing on leukemia; Kathrin Plath, who was at the Whitehead Institute for Biomedical Research at MIT and is studying the biology of how stem cells differentiate; and Amander Clark from UC San Francisco, who wants to see how stem cell research can help improve human fertility

"Stanford University has made several prominent hires, including two in May from Harvard and the University of Michigan. UC Irvine has begun planning a $60-million facility to house its program, and on Friday hired Peter Donovan, a prominent Johns Hopkins University professor, as an interim co-director."

Separately from the Times article, John Simpson, stem cell projector director for the Foundation for Taxpayer and Consumer Rights in Santa Monica, commented on the hiring of Pera, but his remarks apply to the others as well:

"This just shows that Prop. 71 is having worldwide impact and that California is becoming the model for publicly funded stem cell research. If the ICOC is to fulfill the promises made to the voters, CIRM polices need to be grounded on three principles: affordability, accessibility and accountability."

Stem Cell Matters Moving Into Gubernatorial Campaign

You might call him Stem Cell Steve. He is the only major candidate for governor of California with a section of his website devoted to stem cell issues.

He is Steve Westly, the elected controller of the state of California. Westly is running for the Democratic nomination for governor against Phil Angelides, who is the elected state treasurer.

The position of controller is pretty much a ho-hum office, hardly worth more than the proverbial bucket of warm spit, as a former vice president of the United States once described his own office. It is difficult to electrify the electorate when your main responsibilities as controller are primarily printing state payroll checks and dealing with "fiscal year-end procedures."

Only one California controller has managed to make it into the governor's office, Gray Davis, who was a colleague of ours some 30 years ago.

We ran across Westly's interest in stem cell matters when we saw a Google ad bearing his name on this web site. That means the Westly campaign is paying Google to place ads on sites that deal with stem cell issues.

(For the record: We -- the California Stem Cell Report -- do not have any control over which ads Google places on our pages. We do not receive any revenue from Google unless someone happens to click on Westly's ad or any of the others that may appear. Even then the amounts are inconsequential or less. Since Google ads began appearing on this blog in early 2005, we have not received one cent from the advertising. We hesitate to speculate about what that means.)

Westly's ad makes a pitch. "Stem cell research – why it's held up and how you can help," it reads. The ad contains a link that takes the curious to a section on Westly's campaign website called "Stem Cell Research Now!" It targets Gov. Schwarzenegger as allied with opponents of stem cell research who have sued the stem cell agency. Here is what it says:

"Right-wing troublemakers Ted Costa and Lew Uhler are behind the lawsuit. They also happen to be - surprise, surprise - two of Governor Schwarzenegger's biggest backers. Costa led the recall and Prop. 77 drives. Uhler was behind the union dues initiative, Prop. 75.

"So why doesn't the Governor call off his conservative cronies? Millions of people are waiting for cures. Stem cells may be the fastest way to get those cures. And Arnold's buddies are holding up the research."

The pitch includes an electronic petition that is designed to be sent to the governor with the electronic addition of a signature and email address from whomever may be viewing the site, whether they live in Korea or South Dakota. Our suspicion is that the petition, if it ever gets delivered, would contain no names from Korea. The Westly effort is undoubtedly designed to identify probable Westly supporters who are interested in stem cell research. Once identified, they can be targeted later for more specific pitches in support of Westly.

Westly's rival for the Democratic nomination, Angelides, does not have a similar focus on stem cell issues. One can only speculate on the stem cell strategy in Westly's campaign. But here is one theory: Westly's people read polls that say the public supports stem cell research. If the public knows Westly supports the research, that will generate voter approval. It will generate even more voter approval if the evil Gov. Gropenator is linked with the Luddites who oppose stem cell research and are suing to prevent it. Further, attacking the governor at this stage could also help weaken him in next fall's general election. Or so the reasoning may go.

We should note that Westly is a former top executive at eBay and has close links to the Silicon Valley financial community, which was a big supporter of Prop. 71. California stem cell chairman Robert Klein also donated $27,695 to Westly's campaign for controller, according to one report.

More Cash for CIRM This Month?

The financially hard-pressed California stem cell agency hopes to get a boost this month with the sale of bond anticipation notes to philanthropic investors.

Reporter Laura Mecoy of The Sacramento Bee quoted Zach Hall, president of CIRM, as saying that the agency hopes to secure enough funding by the end of January to move forward on some of the training grants it approved in September.

No money has been available for grants because litigation against the agency has made it unable to issue the $3 billion in bonds that voters authorized more than a year ago. The lawsuits are not expected to be resolved until 2007.

Mecoy's story Sunday morning also reported that the agency is "trying to determine whether state-funded research can use stem cell lines developed by other agencies that allow larger donor payments" than permitted under Prop. 71, which limits egg donor payments to reimbursement for expenses.

"There are other entities in other countries that operate in other ways. If we insist everybody do as our regulations say, our scientists will not be able to work on (stem cell) lines that deviate from our standards," Hall said.

The main focus of Mecoy's story was on the impact of the Korean scandal on legislation by State Sen. Deborah Ortiz, D-Sacramento, to tighten oversight of the stem cell agency, which we discussed on Dec. 20 (Christmas Comes Early for Sen. Ortiz).

Mecoy wrote:

"'The South Korean scandal makes it more difficult for opponents to allege this is a plot by the right wing,' Ortiz said of her legislation. 'It shows the best and the brightest in the scientific community couldn't catch these instances of fraud and overstated research.'"

Mecoy continued:

"'If their industry can't sufficiently police themselves and root out fraud, then government should step in,' the senator said. 'California would be leading the nation if we did the right thing.'

"Hall said the South Korean scandal 'emphasizes the importance of just the type of apparatus we are putting together' at the stem cell agency.

"But he said fraud is not unique to stem cell research: It has happened in various fields of scientific endeavor.

"'These things happen,' he said. 'The more intense the interest, the more likely they are to happen, and the more likely they are to be found out.'"

Regarding the sale of the bond anticipation notes, agency officials earlier said they hoped for funding last fall so we will have to wait and see whether the current expectations materialize. Agency officials have been circumspect on any pending deals, but on Oct. 31, an official from the state Treasurer's office said there was no interest from investors in purchasing the notes. However, that was two months ago and that official may not have been fully informed on efforts by stem cell chairman Robert Klein to peddle the notes. He seems to have taken on the sale as a personal project.

A sale of the notes in amounts that would not fully fund the first year of all the authorized grants raises interesting questions about which institutions would receive cash and in what amounts. Presumably that would be a decision that would be made by the stem cell Oversight Committee, which does not meet again until February. A politically astute grant recipient might promptly begin discreet lobbying of Oversight Committee members to assure that its programs receive favorable consideration.

A Korean Lesson: 'Money Breeds Corruption'

The California stem cell agency needs to start asking more questions about the Korean scandal and how it may relate to stem cell research in the Golden State, The Sacramento Bee said today in an editorial.

The Bee said CIRM can learn from the Hwang affair but only if the agency takes "the time to publicly grapple with this scandal. So far, they have acted as if Hwang is a distant aberration whose fabrications don't affect them. Nothing could be further from the truth."

The editorial continued:

"While California's institute can do only so much to combat scientific fraud - the responsibility lies largely in the hands of peer-reviewed journals - it can set standards for obtaining eggs and other biological material, and ensure those rules are enforced. The institute's medical standards working group is now preparing such regulations. Yet at their last meeting, on Dec. 1, the committee's members went out of their way to avoid any discussion of Hwang's mounting troubles."

In a separate opinion piece, Associate Editor Stu Leavenworth wrote that it is easy to learn the wrong lessons from Korea.

It is, he said, "laughable to hear people insinuate that this debacle could have been avoided if American researchers, and not the South Koreans, were leading the way.

"The annals of U.S. science are filled with researchers who faked findings, exploited human test subjects and enriched themselves while extolling their supposed ethics. Indeed, it is interesting that Hwang's fraud was exposed not because of scrutiny from U.S. researchers, but because his colleagues in South Korea had the courage to go public with questions about their 'supreme scientist.'"

He continued,

"The only lesson is an old one: Money breeds corruption. Rightly or wrongly, embryonic stem cell research is seen as the next big rainmaker in the biomedical field. With so much money riding on the outcome, some people are going to lie, cheat and steal.

"To combat such fraud, editors of science journals - and those of us in the media - need to be much more skeptical than we were in this case."

California Stem Cell Director Stresses Speed

One of the members of the Oversight Committee of the California stem cell agency spoke of the need for "urgency" in finding stem cell therapies in an interview with a newspaper printed today.

The quest for speed is one of the problems at the heart of the Korean stem cell scandal, according to some scientists.

Joan Samuelson of Healdsburg, CA, an attorney and president of the Parkinson's Action Network, is the committee member who did a Q&A with the Santa Rosa Press-Democrat. Given the nature of such Q&As, it is likely that she actually made her comments anywhere to a few days to a few weeks prior to their publication, probably at a time when the scandal was not as hot. The topic of Korea did not even come up in her printed remarks.

Nonetheless, one of the refrains heard from the patient advocates is the crying need for cures. Some, such as Samuelson, are living with diseases that could be alleviated through the results of stem cell research.

Here are a couple of excerpts from the interview:

"Prop. 71 seeks something that may be a first in biomedical history: not just research advances, but actual treatments and cures resulting from the investment of funds, and in a tight time frame. The National Institutes of Health, for example, spends about $30 billion each year in federal tax dollars to fund research, but requires no particular results.

"My 15 years of watching this process causes me to side with the scientists who believe that if every step is treated with great urgency, sharing of information, collaboration in approaches and adequate funding, that will start translating into the first treatments far sooner than they will if this process is left to chance."

"Several forces delay finding cures. For example, you might not get a cure for decades because researchers don't stick to the problem. They move on to something else, because they lose interest, because it's too hard, because there's no funding.

"But this won't happen at the institute because 10 of us wake up every morning saying, 'Please, God, let this succeed.' My vision is that the institute will be available to fund any piece of remaining research needed. We're going to have to work with the whole world."

The reference to "10 of us" is to the number of patient advocates on the board.

CIRM Scientific Conference Expenses Disclosed

The California stem cell agency's international scientific conference last October cost $128,489, coming in nearly $87,000 under budget.

The event drew a fair amount of news media attention (see "Everything" and "Clues" items on this blog) and was praised by editorially by at least one newspaper as one of the wisest expenditures CIRM has made. That said, the agency was a bit balky at releasing the budget figures.

The largest single expenditure was $48,643 for rooms, facilities and equipment at the PARC 55 Renaissance Hotel in San Francisco. Rooms were discounted 30 percent for the 32 persons that the agency picked up expenses for. CIRM paid $45,200 to Mosaic Event Management to run the event. Travel expenses for speakers and others ran an estimated $20,000. Another estimated $9,000 is slated to go to science writer Kelly LaMarco, who is preparing an executive report of the meeting.

The event generated $23,450 in registration and other fees.

The expenses do not include a reception for attendees that was hosted at the St. Francisco Hotel by the California Healthcare Institute, a biomedical industry group.

Why Do Scientists Cheat?

"If you're not in first place, you're no place," says one bioethicist in an article in the Christian Science Monitor about what it calls "a year of research ethics challenges."

The springboard for the piece by reporter Peter Spotts is the Korean affair. But Spott recounted scientific scandals at the Veterans Administration, MIT and the University of Vermont.

He also dealt with dubious dealings at NIH.

"In a survey of NIH-funded scientists, released in June, only 1.5 percent of 3,000-plus respondents acknowledged having falsified or plagiarized information. But 15.5 percent admitted to altering their research approach under pressure from funding sources, and 12.5 percent admitted to looking the other way when colleagues used flawed data."

The comment about "first place" came from Thomas Murray, president of the Hastings Center, a bioethics institute in New York state. He noted that scientists have the usual human failings but work in an intense environment where only the best ideas rise to the top. He did not say "perceived" best ideas, but he should have.

Christmas Comes Early for Sen. Ortiz

The Korean stem cell scandal is a bit of political gift to California state Sen. Deborah Ortiz.

While it certainly was not something she was hoping for, the hoo-ha surrounding Hwang Woo-suk has created an atmosphere that will aid Ortiz' efforts to tighten oversight of the California stem cell agency, protect egg donors and ensure that California reaps the benefits of its $6 billion research investment.

Ortiz, a Sacramento Democrat who is the most influential California legislator on stem cell matters, authored legislation earlier this year to protect egg donors. Public awareness of the bill was minimal, and it was vetoed, with little notice, by the governor.

Ortiz plans to re-introduce the measure come January. It will have a much more favorable environment given the heightened awareness created by the Korean cash-for-eggs affair, which involved egg donations from junior researchers as well. That is considered improper by some.

Her proposed constitutional amendment, SCA13, will also gain support as a result of the Korean scandal. The measure would increase state oversight of the agency and is intended to provide more benefits to California from research commissioned by CIRM. It requires a two-third vote of both houses and voter approval. But the proposal has key Republican support, which should help ease its passage in the legislature.

Ortiz is undoubtedly going to exploit – directly or indirectly -- what one observer has called the "flabbergasting" disclosures coming from Korea to bolster support for the proposal, which has been opposed by CIRM and its allies.

Term limits will force Ortiz out of the legislature at the end of 2006 so she has a limited time to accomplish her legislative objectives. She is reportedly eyeing a statewide office and also needs a solid record to campaign on.

Earlier this year – prior to the Hwang affair – Ortiz indicated that stem cell matters were at the top of her agenda.

"I have about a year left in the Legislature, but this will probably be my No. 1 priority.  The stakes are too important if we don’t meet the intent of the initiative, and if we don’t make good on the promises we made to the voters," she said during a hearing on intellectual property and CIRM.

Look for a major push by Ortiz after the turn of the year that will involve PR, op-ed pieces, public appearances, support-building among stem groups and more.

California Stem Cell Leaders Speak to Korean Scandal

A number of California stem cell researchers discussed the Korean stem cell scandal in a piece by reporter Bruce Lieberman in the San Diego Union-Tribune, including two members of the Oversight Committee of the California stem cell agency. Here are some excerpts from the article:

"'It's a black eye on the whole world of science,' Richard Murphy, president of the Salk Institute in La Jolla (and CIRM director), said. 'Exciting areas of research are always competitive . . . but healthy competition never justifies sloppy research, cutting corners or dishonest behavior.'"

"'We would have figured out very quickly that there was some problem here. . . . And the truth would have come out much sooner had we been in a position like we normally are – to be able to jump in and work with complete freedom,' said John C. Reed, president of the Burnham Institute in La Jolla(also a CIRM director). 'It's very important that we have laboratories throughout the country and around the world to . . . verify whether observations made by one group are reproducible by another.'"

"Dr. Evan Snyder, head of stem cell research at the Burnham Institute in La Jolla, said the embarrassing South Korea episode shows how science's built-in system of checks and balances can root out misconduct.
"'This was an example of the scientific community doing what it does routinely, which is police itself,' Snyder said.

The story also quoted Hallye Jordan, a spokeswoman for State Sen. Deborah Ortiz, the lead author of a proposed ballot measure to tighten controls on the California stem cell agency.

"'This whole unfortunate episode has pointed to the need for good governmental oversight of this important research," Jordan said last week. 'We want to maintain the public's confidence in stem cell research, and the best way to do that is through accountability and openness.'"

Korean Markets Warn Off Shy Stem Cell Investors

Those timid souls known as venture capitalists are not likely to be encouraged by the events in Korea, and that is likely to reflect poorly on the stem cell investment climate in California, at least for the short term.

Some, however, might argue that it is a buying opportunity – prices are down because of temporary market indigestion in swallowing the bad news out of Asia.

In the past few days the news has not been good for those holding Korean biotechnology investments. According to Reuters, prices in Korean biotech stocks "plunged" on Friday, one company by 15 percent.

The market reaction is another reason why private capital is not interested in funding the type of research that the California stem cell agency would if it were not snarled in a lawsuit.

Korean News Fuels Fire Against CIRM

As the negative news about stem cell research rolled in from across the Pacific, the Los Angeles Daily News (circulation 195,000) carried a hostile article about the California stem cell agency written by one of the minions of a "free market think tank" in Sacramento.

The opinion piece was authored by K. Lloyd Billingsley, editorial director of the Pacific Research Institute, which calls itself a "free market think tank." The facts of the piece are all familiar to followers of the agency.

However, he quoted Wesley J. Smith of the Discovery Institute, another similar organization, as arguing:

"Voters might be disposed to undoing Prop. 71" when they believe in alternatives "and when the problems of Prop. 71 permeate the public consciousness. One year after the vote, that is beginning to happen."

The views of such folks as Billingsley and Smith find fertile ground when the stem cell turf is disturbed by the Korean uproar. Two months ago such views would have had much less impact than they do now. Beyond that, the references to the voters disposition makes it clear that the opponents of Prop. 71 are looking at a ballot measure involving the agency. That means CIRM and its friends should be rallying anybody who could be considered their allies. The best bet for the agency is to keep a measure off the ballot, whether it is SCA13 or an initiative backed by well-financed fundamentalist forces.