Coming Stem Cell Train Wreck?

The combination of Robert Klein as head of a state agency giving away $3 billion for stem cell research and presiding as well over a personal, stem cell lobbying group is a "train wreck waiting to happen," according to the Consumer Watchdog group.

John M. Simpson, stem cell project director for the Santa Monica, Ca., organization, said he welcomed Klein's apology for the "unseemly" attack on state Sen. Sheila Kuehl, lead author of legislation opposed by both the stem cell agency and Klein's group.

Simpson wrote on his organization's blog:

"The apologies are welcome.  However, so long as Klein remains chairman of the state stem cell agency, the California Institute for Regenerative Medicine, and president of the advocacy group, Americans for Cures, the situation remains a train wreck waiting to happen."

Simpson continued:

"Insisting on wearing both hats in untenable.  It damages the credibility of both CIRM and Americans for Cures. Klein needs to realize his dual roles seriously undermine the dedicated staff of both organizations."

Patient Advocate Reed Praises Kuehl, Says Sometimes People Go Too Far

Patient advocate Don Reed, who has probably attended more meetings of the California stem cell agency than any of its directors or even its staffers, reacted this weekend to the blistering attack on the author of legislation he fervently opposes.

Reed (see photo) is vice president of Americans for Cures, which fired off the personal comments on the national and influential political blog, Daily Kos. While Reed said that he is proud of the group, he added:

"Sometimes in the heat of battle, people go too far with hurtful words."

Here is the text of what he sent the California Stem Cell Report.

"A negatively slanted editorial on Senate Bill 1565 (Kuehl, Runner) was recently printed in the weblog Daily Kos. It was written by some of the staff at Americans for Cures, a group with which I am proud to be associated. They are my friends and co-workers.

"But I want it clearly understood I had no part in the writing of that particular article.

"I have not yet been able to read the entire piece, just bits and pieces of it. But as the co-directors of our group have publicly apologized for it, apparently it went over the edge. Sometimes in the heat of battle, people go too far with hurtful words. I have stuck my own foot in my mouth too many times to criticize anyone.

"I do strongly oppose SB 1565. Anyone wanting my opinions need only go to my website, www.stemcellbattles.com, or just Google me. My writing is signed, either with my name, Don C. Reed, or as Diverdonreed, for blogs which require a pseudonym.

"But my differences with Senator Sheila Kuehl are professional, not personal. She has earned the right to be treated with affection and respect.

"Ironically, last week I had a very positive conversation with Senator Sheila Kuehl’s legislative aides, Lark Park and Peter Hansel. We argued about the bill, of course. To me the bill is a serious mistake: a threat to the California stem cell program.

"I had two reasons for the visit.

"One reason was of course to see if there were any loopholes possible, especially in the price-control part of the bill. Ms. Park and Peter Hansel said the Senator had offered to make a change. The stem cell board may or may not agree that the answer is enough to gain their support, but it was a genuine attempt, a serious proposal. (Other serious objections remain, and I am still in opposition to the bill.)

"But there was a second reason for the visit, a personal one, something I had hoped to tell the Senator herself, but that was a long shot at budget crisis time.The Senator is “termed out”, that California mistake of a law that says lobbyists may remain in Sacramento forever, but the people’s representatives can only stay a while.

"But her efforts on behalf of all Californians will live on after her term in office. It is to be hoped she will continue her work to bring decent and affordable healthcare to everyone, perhaps on a national or international level. I would love to see her be U.N. Ambassador for international health programs, or a similar position.

"Sheila Kuehl is an exemplary human being. She makes the world a brighter place."

(After Reed sent us this item, we sent him a copy of the piece on Daily Kos, which has removed the item. If you would like to receive a copy of it, please email a request to us at djensen@californiastemcellreport.com)

Stem Cell Affordability Legislation Changed to Meet CIRM Objections

The California lawmakers behind legislation to ensure affordable access to taxpayer-financed stem cell therapies moved last week to ease the concerns of the state's $3 billion stem cell research agency.

The changes were made prior to a scathing, national Internet attack on the bill's lead author by the private lobbying group run by Robert Klein, who also serves as chairman of the state stem cell agency. One consumer advocate has called for Klein's resignation in the wake of the assault by Americans for Cures, the Klein organization. The group used such terms as "ignorant," "dumb" and "craven" in connection with Sen. Sheila Kuehl, D-Santa Monica.

Late Friday, Klein's group apologized. Klein told the California Stem Cell Report he was unaware of the Internet attack by his group and said he had "great personal respect" for Kuehl. Our understanding is that he intends to personally apologize to Kuehl.

CIRM last month officially opposed Kuehl's bill, SB 1565, on the grounds that it would discourage biotech firms from developing therapies and limit the agency's flexibility to negotiate affordability issues, among other things.

In response, Sens. Kuehl and George Runner, R-Antelope Valley, made changes that appear to go a long ways in dealing with the objections. But in a letter Thursday to Kuehl, Klein expressed the agency's continued opposition. The letter, dated the same day as the Internet attack on Kuehl, was also signed by CIRM President Alan Trounson and Ed Penhoet, vice chairman of the CIRM board of directors.

Below are key sections of the latest amendments to the measure, as provided by Kuehl's office. The actual bill, however, will not be available online via the Legislature’s website until Tuesday. The measure comes up for a hearing in the Assembly Appropriations Committee on Wednesday. The full text of CIRM's letter to Kuehl follows in a separate item.

Here are the amendments in SB 1565.

"Any plan subject to subdivision (a) shall include a requirement that each grantee and any licensee of the grantee that sells drugs that are, in whole or in part, the result of research funded by CIRM shall provide those drugs to publicly funded programs in California at one of the three benchmark prices in the California Discount Prescription Drug Program."

"Notwithstanding subdivision (c), the ICOC may waive the requirement that grantees and licensees of the grantee provide drugs that are, in whole or in part, the result of research funded by CIRM at one of the three benchmark prices in the California Discount Prescription Drug Program (Division 112 (commencing with Section 130500)), as it exists on January 1, 2008, only when the following conditions are met:
"(1) Either of the following conditions is met:
"(A) The drug shall be used for the diagnosis, cure, mitigation, or prevention of a rare disease or condition, as recognized by the federal Food and Drug Administration under Section 360bb of Title 21 of the United States Code, by individuals who would not otherwise have access to the drug through private insurance or public programs, the number of individuals who will have increased access to the drug represent a significant proportion of the individuals in California who have that rare disease or condition, and the ICOC has made a determination that, in the absence of the waiver, development of the drug will be impeded.
"(B) The grantee commits, in writing, to provide expanded access to a drug under its access plan to a class of patients who would not otherwise receive access to the drug, including working uninsured individuals who do not qualify for any public program or private health plan or policy that provides coverage of the drug, and the ICOC has made a determination, before granting a waiver and based on the number of individuals who will have access to the drug and the likely costs of the drug, that the waiver will provide significant benefits that equal or exceed the benefits that would otherwise accrue to the state through the pricing requirements set forth in subdivision (c).
"(2) The ICOC has conducted a public hearing prior to adopting any waiver pursuant to this subdivision. The ICOC shall provide findings and declarations and documentation to the Legislature substantiating the need for, and benefits of, a waiver adopted pursuant to this subdivision at least 30 days prior to the public hearing and shall post these documents on its Internet Web site at the time of submission to the Legislature and provide notice to the public that these documents have been posted."

CIRM Letter Opposing Kuehl Legislation

Here is the text of the CIRM letter stating the agency's continued opposition to SB 1565.


SB 1565: OPPOSE UNLESS AMENDED

July 10, 2008

Dear Senator Kuehl:

Thank you for the opportunity to comment upon the potential amendments to Senate Bill No. 1565. While the Independent Citizens’ Oversight Committee (the “ICOC”), the governing board of the California Institute for Regenerative Medicine (“CIRM”), has taken a position in opposition to the bill on the grounds that is it premature and unnecessary, we appreciate your willingness to engage in a dialogue regarding the potential amendments.

Section 1 of the bill, which would remove the two-thirds vote requirement for funding “vital research opportunities” was added in early June and it has caused a powerful reaction of unanimous opposition from CIRM’s governing board. Proposed subparagraph (E) makes clear that the goal of Section 1 is to eliminate the priority that Proposition 71 places on human embryonic stem cell research. As long as Section 1 remains in the bill, we must strongly oppose SB 1565.

At a time when opponents of stem cell research are arguing that recent developments obviate the need for human embryonic stem cell research, a position we believe to be incorrect, the proposed amendment to Proposition 71 would send the wrong message to Californians and to the nation at large. It would also thwart the will of the more than seven million Californians who voted for Proposition 71 in order to address the federal funding gap for human embryonic stem cell research, a gap that continues to exist to this day. By removing the two-thirds vote requirement, the amendment would undermine the very purpose of Proposition 71 – to provide a priority for funding human embryonic stem cell research. Finally, eliminating the two-thirds vote requirement would be inconsistent with the requirement that Proposition 71 may only be amended to further its purposes. For all of these reasons, which are discussed in greater detail in the attached addendum, we are strongly opposed to the removal of the two-thirds vote requirement.

With respect to Section 2 of SB 1565, we share your view that California state and local government purchasers should have access, at the lowest possible price, to the therapies and drugs derived from CIRM-funded research. Indeed, our regulations include provisions very similar to those set forth in SB1565. Given the complexities of our healthcare system and the uncertainty regarding the types of therapies and drugs that will be developed as a result of CIRM-funded research, we must retain the flexibility to address issues specific to particular diseases and particular therapies. We appreciate your offer of alternative language, including a waiver process. However, we offer our suggestions below in an effort to reduce the risk of unintended consequences. If you are willing to remove the amendment to the two-thirds vote requirement and to accept our proposed amendments, we would be willing to consider taking a “neutral” position on the bill.

Proposed Addition of Subdivision (e)

We believe it would be preferable to give CIRM greater discretion to establish a waiver mechanism pursuant to the Administrative Procedure Act. The addendum to this letter addresses this issue in more depth. This would permit CIRM to assess changes in medical technology and in the health care sector prior to defining the scope and contours of the waiver and it would provide an opportunity for the Legislature and the public to comment upon the proposed waiver mechanism before it is adopted. Therefore, rather than trying to anticipate the circumstances pursuant to which a waiver may be justified, we recommend replacing subdivision (e) with the following language:

(e) Notwithstanding subdivision (c), CIRM may waive the requirement for grantees, and licensees of the grantee, to sell drugs that are, in whole or in part, the result of research funded by CIRM, at one of the three benchmark prices in CalRx, based on a finding that a waiver is necessary to protect the health of Californians whose lives or quality of life is at risk. CIRM shall adopt a regulation or regulations pursuant to the Administrative Procedure Act to implement the waiver provided in this subdivision after notifying the Legislature and conducting a public hearing.

Proposed Amendments to Subdivision (c)(1)

Your proposed amendments to subdivision (c)(1) clarify what we understand to be the original intent of SB 1565. We believe that further refinements, however, may sharpen the expression of the Legislature’s intent. For example, we understand that you intend SB 1565 to apply only to therapies or drugs purchased in California by California state or local government funded programs. The current language, however, would appear also to apply to federally funded programs, including programs funded and administered entirely by the federal government without regard to need. Similarly, we are concerned by the provision that specifies that CalRx, as it exists on January 1, 2008, shall apply regardless of any subsequent changes in the law. While we share your concern about the unintended consequences that could flow from designating a successor program, we believe these concerns could be addressed by incorporating a successor program only if it covers CIRM stem cell-derived therapies or drugs. We therefore propose the following changes to subdivision (c)(1):

(c)(1) Any plan subject to subdivision (a) shall include a requirement that each grantee and any licensee of the grantee that sells drugs that are, in whole or in part, the result of research funded by CIRM shall sell those drugs in California to publicly California state and local government funded programs in California at one of the three benchmark prices in the California Discount Prescription Drug Program (Division 112 (commencing with Section 130500)), as it exists on January 1, 2008, or a successor program to the extent that the program applies to California Institute for Regenerative stem cellderived therapies and drugs.

Conclusion
CIRM is committed to working with the Legislature to address the important issues raised by SB 1565 and to ensure that Californians have access to therapies and drugs derived from CIRM-funded research. Placing these provisions in statute, however, may hinder our efforts rather than help, because we cannot anticipate all of the challenges we will face in the future.

We recognize that the Legislature could amend the law in the future through urgency legislation, but we are concerned about the potential political opposition to changes that may be required to ensure that Californians have access to a therapy derived from human embryonic stem cells. Given the 70 percent vote requirement in Proposition 71, such opposition could prevent the Legislature from passing an amendment that is essential to ensure access. CIRM’s ability to amend its regulations pursuant to the Administrative Procedure Act, on an emergency basis if necessary, does not pose the same risk.

While well-intentioned, SB 1565 is premature and unnecessary. Nonetheless, if you are willing to amend the bill to remove Section 1 and provide for a waiver directive regarding the public pricing policy as described above, we are prepared to recommend a neutral position to the ICOC.

We appreciate your support of CIRM and your willingness to work with us to address these critical issues.

Sincerely,
Robert N. Klein, Chairman, ICOC
Alan O. Trounson, President
Edward E. Penhoet
Vice –Chairman, ICOC

California Stem Cell Chief Says He Was Unaware of Personal Attack on Lawmaker

Robert Klein, chairman of the $3 billion California stem cell agency, today said he was "completely unaware" of the personal attack on a California state lawmaker by his lobbying group, Americans for Cures.

Klein, who is president of Americans for Cures, said he had "great personal respect" for Sen. Sheila Kuehl, D-Santa Monica, the object of the attack. Kuehl, a respected California lawmaker and chair of the state Senate Health Committee, drew the ire of Americans for Cures because of her legislation aimed at ensuring affordable access to taxpayer-financed stem cell therapies.

In a statement to the California Stem Cell Report, Klein praised Kuehl's "intellectual strength" and leadership. Here is the text of what Klein sent the California Stem Cell Report:

"Dear David,

"Theoretically, I have been on vacation since Tuesday morning, July 8th, but I gave up my vacation last night and came back to CIRM to deal with misinformation regarding my personal position on SB 1565. As I stated at the Controller’s financial oversight committee meeting on Monday, July 7th, I have great personal respect for Senator Kuehl, including most recently her leadership on the effort to create universal healthcare coverage. On Monday, I made it clear that I have deep respect for her intellectual strength in the healthcare area, and that the ICOC’s position is a substantive policy disagreement. The ICOC has taken the position that the complexity of the stem cell therapy area may not permit simple pricing formulas and the agency needs discretion in adapting to the 70 areas of possible stem cell therapies for chronic disease and injury. I also emphasized on Monday that the ICOC is committed to the same goals as Senator Kuehl in obtaining the lowest possible price for state and local government public providers in California.

"The language in the bill addressing embryonic stem cell research, I think, is being interpreted very differently by the ICOC and Senator Kuehl. We are very concerned about the message this type of an amendment would send within California and nationally, and we do not believe that the message would be consistent with the best scientific and medical knowledge at this time.

"As always, I am happy to discuss this with you further. I wanted to make sure you knew right away that I was completely unaware of the blog entry. I have requested that the Daily Kos entry associated with Americans for Cures be deleted from the site because it did not receive clearance from senior members of the organization, and it did not properly reflect the organization’s views on Senator Kuehl.

"Bob Klein"

Consumer Watchdog: Despite Apology, Klein Still Should Still Resign

The Consumer Watchdog group today said it is not withdrawing its call for the resignation of Robert Klein as chairman of California's $3 billion stem cell agency, despite an apology from his lobbying group for its personal attack on a Democratic state legislator.

John M. Simpson, stem cell project director of Consumer Watchdog of Santa Monica, Ca., said the co-executive directors of Klein's lobbying organization, Americans for Cures, "are taking the blame" for the posting on an influential national political blog, Daily Kos. Simpson said on his group's blog,

"What this incident underscores is how inappropriate it is for Klein to hold  positions as chairman of the California stem cell agency and president of a stem cell advocacy group simultaneously.  If he wants to be an advocate -- and he can indeed be effective as the passage of Proposition 71 demonstrates -- he must step down from his position as chairman of the stem cell board.

"The welcomed staff apology does not change the fundamental confict Klein faces by insisting on holding both positions."

Stalled

Our promised items on changes to SB 1565 have been stalled because of events related to Americans for Cures and their posting on Sheila Kuehl. We will carry the amendments and the CIRM opposition letter during the weekend.

Klein's Lobbying Group Apologizes for Blistering Attack on Kuehl

The lobbying group controlled by Robert Klein, chairman of the California stem cell agency, today apologized to state Sen. Sheila Kuehl for the personal attack on her that it published on the influential national political blog, the Daily Kos.

The co-executive directors of Americans for Cures, Amy Daly and Constance McKee, said the language in the item, which included such terms as "dumb," "craven" and "ignorant," was inappropriate. Daly said the item had been removed from the Daily Kos.

Here is the text of their apology, which they asked the California Stem Cell Report to run.

"To all who have read the Americans for Cures diary posted on DailyKos regarding SB 1565:

"We write to offer a formal apology to Senator Kuehl and her supporters. This posting did not go through our normal review clearances. The choice of language was inappropriate and did not reflect the respect that senior members of the organization have for Senator Kuehl.

"We have always appreciated her efforts and were disappointed that her single payer plan was not implemented. She has historically been a great health care advocate for the people of California. This is why it has been so frustrating to us that she is working with Senator Runner – who is strongly anti-embryonic stem cell research – to implement a bill that could frustrate efforts to get stem cell therapies to patients.

"We were wrong in our characterization of her. We have been working hard to educate everyone about the perils of this bill. No one is questioning it precisely because Senator Kuehl has been such an effective advocate. Our frustrations prevented us from using good judgment in our post, and we apologize profusely for our insensitive and unwarranted remarks.

"It should be noted that Bob Klein was completely unaware of our actions on this. We have not spoken to him or met with him in well over two weeks. I’m certain that he is as disappointed in our judgment as you, and we, are.

"Please forgive us and please put the blame for this where it belongs – on Americans for Cures Foundation staff involved in this individual posting – not on Bob Klein. Americans for Cures Foundation has learned from this experience and will re-institute the tight control it has historically had over its postings.

"Sincerely,

"Amy Daly & Constance McKee"

Consumer Watchdog Says Klein Should Resign Because of Personal Attack on Lawmaker

The Consumer Watchdog organization today called for the resignation of Robert Klein as chairman of the $3 billion California stem cell agency after his private lobbying group called a respected state senator "dumb" and "craven."

John M. Simpson, stem cell project director for Consumer Watchdog, a nonprofit Santa Monica, Ca., organization, said the attack was an inappropriate "over-the-top, hysterical call to battle."

Writing on the group's blog, Simpson referred to the Internet posting Thursday by Americans for Cures, Klein's stem cell lobbying group, on the Daily Kos, a widely read and influential political blog.

Americans for Cures targeted Sen. Sheila Kuehl, D-Santa Monica, and her legislation – SB 1565 – which is designed to ensure affordable access to any therapies that result from taxpayer-financed stem therapies. Simpson wrote:

"One can oppose the bill without launching personal attacks and suggesting the sky is falling. For the most part, the board members and agency's staff have followed that policy. But Klein insists on wearing two hats: ICOC(CIRM's board of directors) chairman and president of his advocacy group.

"The positions are incompatible. Since Klein refuses to give up the advocacy role, he must step down from his public position as head of a state agency. Failure to do so undermines the stem cell agency's credibility and ability to do its vital work."

Simpson summarized the legislation:

"It puts in statute regulations CIRM itself developed governing access to drugs by the uninsured; it lowers the vote of the scientific working group necessary to recommend funding non-embryonic stem cell research from a two-thirds majority to a simple majority; and it asks the state's non-partisan Little Hoover Commission to study the governance structure of the agency."

Kuehl's aides have been working with CIRM staffers to deal with the agency's official objections. Earlier this week, Kuehl amended her measure to deal with CIRM concerns. But Klein's lobbying group says the bill is unacceptable in "any form."

We have asked CIRM and Kuehl's office if they have any comment on the posting by the Klein group. We have not received a response, but will carry their comments should they make any.

Coming Up

Later today we will have the text of changes made earlier this week to legislation aimed at ensuring affordable access to CIRM-financed therapies along with the text of a letter from the agency saying that it still opposes the legislation.

Fresh Comment

"Anonymous" has posted a comment/question on the item below.

Coming Up

Early this afternoon, we plan to carry a follow-up story concerning the Daily Kos item (see the item directly below) in which a lobbying group controlled by the chairman of the state stem cell agency personally attacked a California lawmaker. We have asked the state stem cell agency, the lawmaker and others for comment, which we will include if we receive it in a timely fashion. Otherwise, we will carry the comments when we receive them.

Klein's Group Says Kuehl is Ignorant or Mindless or Craven and Dumb

Using the influential national political blog, the "Daily Kos," the private lobbying group of the chairman of California's $3 billion stem cell agency today filed a sharp, personal attack on a Democratic state legislator who is seeking to ensure the affordability of stem cell therapies financed by taxpayers.

Americans for Cures, whose president is Robert Klein and who also serves as chairman of CIRM, wrote an item for Daily Kos which took on highly respected California state Sen. Sheila Kuehl(see photo), D-Santa Monica, co-author of SB 1565, the affordability legislation in question. The Daily Kos is one of the more widely read political blogs in the nation. According to its web counter, it had 899,000 page views today.

The Daily Kos piece, which did not identify the specific author of the article but only attributed it to Klein's group, said,

"Either Kuehl is ignorant on the science, or mindlessly buying into Republican and anti-cures messaging from the Catholic Church, or playing dumb in a craven attempt to get Republican votes to back her legacy as defender of the poor."

Kuehl heads the Senate Health Committee and has been a leader on a variety of issues, including universal health care. A graduate of the Harvard Law School, she has been cited by Capitol insiders as one of the more intelligent lawmakers in Sacramento.

Late last month, at a meeting chaired by Klein, CIRM directors formally opposed SB 1565 but indicated that they wanted to continue to work with Kuehl to resolve differences. Klein's lobbying group, however, was unbending. It referred to "legislative dirty tricks." It called Kuehl's legislation "a thinly veiled ploy to stop embryonic stem cell research in California." Klein's group said,

"California is an example of what we’re seeing all across America.  Anti-cures forces are stepping up state-based legislative dirty tricks to pass 'personhood' laws that would discourage or criminalize stem-cell research.  If this sounds like the pro-life strategy that successfully undercut federal support for reproductive rights, you’re connecting the dots.  Anti-cures legislation is popping up all over America right now, in anticipation of a loosening of restrictions on hESC in January 2009."

Klein's group said,

"We speak for advocates whom Kuehl claims to represent. Our focus is on cures, not legacy.  We understand that private capital will lead science to the marketplace."

Klein's group declared,

"SB 1565 should not be passed in any form."

Fresh Comment and Correction

The Klein lobbying group item indicated that Wesley J. Smith's opposition to hESC research was religion based. He says, "I don't argue from religion, nor get into it." Smith has also filed a comment on the item.

Fresh Comment

John M. Simpson of the Consumer Watchdog group has posted a laudatory comment on the "Sheehy Proposes Changes" involving the grant appeal process.

Klein's Lobbying Group Waging Cyberspace, Patient-Advocate Battle Against SB 1565

The private stem cell lobbying group controlled by Robert Klein, who is also chairman of the state of California's $3 billion stem cell agency, has launched a major campaign to kill legislation aimed at ensuring affordable access to therapies financed by the agency.

The group is Americans for Cures, which denies that it engages in lobbying. Klein (see photo) is its president, a very unusual position for a top government official. Americans for Cures shares the same address as Klein's real estate investment banking firm in Palo Alto, Ca.

Via the Internet, the group is marshalling patient advocates and stem cell research backers to write, phone, email and personally appear in Sacramento to defeat the legislation. Sample scripts are provided along with names, phone numbers and email addresses of lawmakers.

Its email message to supporters says:

"We need you to take a few minutes to help save the California Institute for Regenerative Medicine and embryonic stem cell research in California.  This is under siege right now in the state legislature."

Americans for Cures is targeting SB 1565 by Sens. Sheila Kuehl, D-Santa Monica, and George Runner, R-Antelope Valley. It sailed easily through the Senate and comes before the Assembly Appropriations Committee on July 16. No state lawmaker has voted against it.

Assuming the bill clears the committee next week, it then faces Assembly floor action and would return to the Senate for concurrence in Assembly amendments before going to the governor for his signature, which is by no means assured.

Also linked to the Americans for Cures effort is patient advocate Don Reed of Hayward, Ca., who is vice president of the group. Reed has appeared personally in the Capitol to oppose the bill, but says he is doing so as a private individual. Reed is also one of the most regular attendees at CIRM's public meetings, testifying on almost every occasion.

Reed wrote recently on his blog, stemcellbattles.com, that passage of the bill is a retirement "gift" by lawmakers to Kuehl, who is barred from running again for legislative office because of term limits. Reed said that personally he regards passage of the measure as akin to "getting an arm chopped off in a sword battle."

Klein's private political activities and lobbying efforts fouled relations with the legislature as early as 2005. At one point, CIRM directors moved the agency's legislative unit out from under Klein's control. Relationships improved, but Klein now has a firm grasp on the agency's dealings with lawmakers.

Activities of Klein's group have also lead to public confusion about its relationship to the official state agency. At one point in 2007, Americans for Cures (then operating with a different name) called a news conference for CIRM. The agency staff did not learn about the news conference until it was disclosed on the California Stem Cell Report. This week, Wesley J. Smith, a lawyer, author and foe of hESC research, incorrectly attributed language from Americans for Cures to CIRM. He said CIRM is "is wailing and gnashing its teeth that the very existence of the CIRM is threatened." His error has been picked up by at least one other web site(a religiously oriented foe) and probably more.

CIRM has never officially commented substantively on Klein's lobbying group, and Klein does not see the activity as a conflict with his government duties. Nonetheless, the priorities of Americans for Cures are not necessarily the same as those of a government agency, whose first responsibility is to the public – not industry, not patient advocates and not researchers.

(The item below contains the text of the email being sent out to drum up opposition to Kuehl's bill. The copy was sent to us by an interested party who must remain anonymous.)

(Editor's note: An earlier version of this item indicated that Smith's opposition to hESC research is religiously based. He says he "does not argue from religion or get into it."

Text of Americans for Cures Email and Links to Its Position

Here is a partial text of the email message from the Americans for Cures campaign against SB 1565, minus much of its html coding.

Here also are links to Cures' one-page analysis of the bill and its full analysis, its home page pitch on SB 1565 and other material.

Subject: Action Alert: Last Chance to Stop Restrictions on Research

We need you to take a few minutes to help save the California Institute for Regenerative Medicine and embryonic stem cell research in California.  This is under siege right now in the state legislature.  A few weeks ago, we failed to stop Senate Bill 1565 (Kuehl-Runner).  The bill was passed by the Senate, and has now also passed through two Assembly Committees: Health and Judiciary. The final step before a floor vote is a hearing in the Assembly Appropriations Committee (contact information below). We need you to act now and ask for a NO vote on SB 1565. Here's how:
1.Please call the Appropriations Committee at (916) 319-2081 and fax the Committee at (916) 319-2181.
2.Please email us to add your name to our listof those who oppose SB 1565.
3.Please call/fax/write as many of the Committee Members as you can.
4.Please call/fax/write your own Assembly Member. (To find your Assembly Member or State Senator, please click here and enter your address.)
5.Please see below for a script/sample email.

The Appropriations Committee will hear the bill on July 16, and so we need your help right now. If you live near Sacramento, please consider joining us in person to stand up for this research. (Let us know if you can be there we'll keep you updated on time and place.)

Over seven million voters expressed a desire to fund embryonic stem cell research when they passed Proposition 71. SB 1565 would remove the built-in preference for embryonic stem cell research - directly contradicting the will of Californians.

We passionately support the goal of healthcare that is accessible and affordable to all Californians. However, this bill will discourage private industry from developing therapies and cures. Currently, the law allows the California Institute of Regenerative Medicine (CIRM) to provide companies with additional incentives to develop therapies for "orphan" diseases such as cystic fibrosis and Lou Gehrig's disease. SB 1565 will eliminate these incentives, making it financially unfeasible for companies to pursue therapies for rare diseases. SB 1565 abandons these patients and their families.  
  
If SB 1565 passes, entrepreneurs and private capital will likely remain on the sidelines in the fight for cures. That means a delay in developing cures and therapies; even worse, therapies for some conditions may never be developed.  
  
Opposing SB 1565 keeps therapy development on the fastest track for cures.  
Opposing SB 1565 is the best vote for taxpayers because new therapies can reduce direct and indirect economic costs.  
Opposing SB 1565 is the best vote for families and patients who suffer every day from devastating chronic conditions.  

We must accelerate investment in CIRM technologies for the benefit of everyone. And that is why we need you to call now.
 
1.Please call the Appropriations Committee at (916) 319-2081 and fax the Committee at (916) 319-2181.
2.Please email us to add your name to our list of those who oppose SB 1565.
3.Please call/fax/write as many of the Committee Members as you can.
4.Please call/fax/write your own Assembly Member. (To find your Assembly Member or State Senator,  please click here and enter your address.)
5.Ask your friends and family to do the same.
6.After you have done your best to stop SB1565, please let us know what you were able to accomplish. (inform@americansforcures.org)

Thank you for being on the frontlines in the fight for cures.
  

Warm regards,
Amy & Constance
  

For a full analysis of the bill and its negative impacts, please click here .
  

Sample Script/Email:
 

Hello, my name is ______________, and I live in ____, CA.  I am calling/writing to urge Assembly Member __________ to oppose Senate Bill 1565 in the Appropriations Committee and on the floor.  SB 1565 will remove CIRM's funding preference for embryonic stem cell research and will delay the development of emerging medical treatments that have the potential to help millions of Californians and people around the globe.  SB 1565 will price-fix technologies not yet in existence. It will discourage investment in vital stem cell research and cures.  We must stay on track to develop these lifesaving treatments, and for that, I am asking for your NO vote on SB 1565.  Thank you.  
  


Assembly Committee on Appropriations
      
  Committee Members   District   Phone   Fax   E-mail   
  
  Mark Leno - Chair     Dem-13   (916) 319-2013   (916) 319-2113     Assemblymember.leno@assembly.ca.gov   
  
  Mimi Walters - Vice Chair     Rep-73   916) 319-2073   (916) 319-2173     Assemblymember.walters@assembly.ca.gov   
  
  Anna M. Caballero     Dem-28   (916) 319-2028   (916) 319-2128     Assemblymember.Caballero@assembly.ca.gov   
  
  Mike Davis     Dem-48   (916) 319-2048   (916) 319-2148     Assemblymember.Davis@assembly.ca.gov    
  
  Mark DeSaulnier     Dem-11   (916) 319-2011   (916) 319-2111     Assemblymember.DeSaulnier@assembly.ca.gov   
  
  Bill Emmerson     Rep-63   (916) 319-2063   (916)319-2163   Assemblymember.emmerson@assembly.ca.gov   
  
  Warren T. Furutani     Dem-55   (916) 319-2055   (916) 319-2155     Assemblymember.Furutani@assembly.ca.gov   
  
  Jared Huffman     Dem-6   (916) 319-2006   (916) 319-2106     Assemblymember.Huffman@assembly.ca.gov   
  
  Betty Karnette     Dem-54   (916) 319-2054   (916) 319-2154   Assemblymember.Karnette@assembly.ca.gov   
  
  Paul Krekorian     Dem-43   (916) 319-2043   (916) 319-2143   Assemblymember.Krekorian@assembly.ca.gov   
  
  Doug La Malfa     Rep-2   (916) 319-2002   (916) 319-2102     Assemblymember.lamalfa@assembly.ca.gov   
  
  Ted W. Lieu     Dem-53   (916) 319-2053   (916) 319-2153     Assemblymember.Lieu@assembly.ca.gov   
  
  Fiona Ma     Dem-12   (916) 319-2012   (916) 319-2112   Assemblymember.Ma@assembly.ca.gov   
  
  Alan Nakanishi     Rep-10   (916) 319-2010   (916) 319-2110   Assemblymember.nakanishi@assembly.ca.gov   
  
  Pedro Nava     Dem-35   (916) 319-2035   (916) 319-2135     Assemblymember.nava@assembly.ca.gov   
  
  Sharon Runner     Rep-36   (916) 319-2036   (916) 319-2136     Assemblywoman.Runner@assembly.ca.gov   
  
  Jose Solorio     Dem-69   (916) 319-2069   (916) 319-2169   Assemblymember.solorio@assembly.ca.gov     


 
       
  Authors   District   Phone   Fax   E-mail   
  Senator Sheila Kuehl     Dem-23   (916) 651-4023   (916) 324-4823   senator.kuehl@sen.ca.gov   
  Senator George Runner     Rep-17   (916) 651-4017   (916) 445-4662   Via website: http://cssrc.us/web/17/contact_us.aspxhttp://cssrc.us/web/17/contact_us.aspx

CIRM Director Sheehy Proposes Changes in Grant Appeals

Jeff Sheehy, a member of the board of directors of the California stem cell agency, offers the following thoughtful perspective on the problems with appeals/reconsideration of grant applications. His comments include suggestions for changes that could ease concerns of some applicants and what he describes as a "muddle."

Sheehy is a member of the Grants Working Group and has participated in the reviews of hundreds of grant applications at CIRM. He has served as its acting vice chairman on a number of occasions. Here is the text of his comments.

"I think we have gotten into a muddle over the question of appeals by applicants to CIRM and the ICOC(CIRM's board of directors). First, as Don Gibbons has reiterated in this item, objective process complaints such as one involving potential undisclosed conflicts of interest by reviewers are allowed by CIRM and given appropriate consideration with appropriate action if needed.

"However, appeals/comments concerning the content of reviews cannot be considered by CIRM staff. To do so would make CIRM staff effectively reviewers. In addition, CIRM staff could be placed in the position of making decisions regarding the funding of grant applications. Prop. 71 clearly gives the Grants Working Group (GWG) responsibility for reviewing grants and the ICOC takes those reviews as advice and then is solely empowered to make decisions to approve or not approve a grant application.

"CIRM and the ICOC could decide to implement a resubmission process allowing applications with disputed reviews to be re-reviewed by the GWG. I personally am undecided on this approach but think it is unlikely to be adopted.

"What is confusing is that appeals/comments about any item under consideration by the ICOC are expressly allowed. California public meeting laws govern a state agency with a decision-making board that meets in public. That means public comments/appeals are expressly allowed, as the ICOC has already experienced. In addition, letters to the ICOC regarding applications or any matter under consideration are also allowed and we have received them on an application and other matters.

"Instead of obfuscating and stonewalling, CIRM should be direct and forthright about this existing appeal process. In that context, the process could then be properly organized. Those who wish to use public comment can be informed of our current 3-minute limit and advised that the limit could be shortened to 2 or even 1 minute if we get a significant number of individuals who wish to comment. In addition, we could suggest length (hopefully a couple of pages) and format for written appeals (i.e., formats easy to post on CIRM¹s website). We could also inform applicants who wish to use this process that their letters will be made public and the application score and identity will be revealed upon receipt/posting of letters or after public comment.

"From my perspective, written comments/appeals from applicants would be preferable and I would hope to receive them early enough to consider thoughtfully as I review materials prior to ICOC meetings.

"Part of the rationale for the composition of the ICOC is to have on hand scientific expertise to inform decisions around grant applications. I have confidence that my colleagues can digest any additional input from applicants and make appropriate decisions. After all, the ICOC has already considered and made decisions regarding applications appealed to it."

CIRM Responds to Cascade Complaints

The California stem cell agency today defended its grant review process in the wake of complaints by an applicant, Cascade LifeSystems of San Diego, concerning the fairness of CIRM's procedures.

We asked CIRM if it had any comments concerning the item we wrote dealing with Cascade's concerns. We also specifically asked CIRM the following question: How can an applicant appeal on the basis of a conflict of interest if it does not know the names of the specific reviewers who evaluated their application?

Here is the text of the response from Don Gibbons, chief communications officer for CIRM.

"The company would note anyone on the review panel whom it believes has a potential conflict, then staff would see if that person was a primary or secondary reviewer, or if not, whether they made substantive comments during the review that could have influenced scores.

"You should know that CIRM does not believe that the reviewer citing 0.3 percent instead of 0.66 percent is a substantive error. The latter would still require 150 eggs to get one cell line, and that was a significant weakness in the application. The three percent or one-in-30 number cited elsewhere in the application by the firm is noted to come from preliminary data, something that we felt was not peer reviewed and not substantiated, and therefore outside of the realm of consideration for review. There were several other weaknesses in the application cited by the reviewers.

"CIRM’s success rate for grant applications is already considerably higher than for NIH applicants."

Our comment on the conflict of interest question raised by Cascade: The names of all the scientists on the review panel are public. Only in cases of the names of individuals assigned specifically to a specific application are the names secret, as we understand the process. An applicant can see the names of all reviewers in advance, do some research on the individuals and ask CIRM ahead of the review to bar particular reviewers from evaluating its application.

We suspect that no applicant has performed that sort of due diligence, but we could be wrong. In fact, raising such an issue ahead of a review could have a negative impact on consideration of an application. Few reviewers are likely to be fond of having their integrity questioned. And an accusation of a conflict of interest cannot be fully investigated without informing the reviewer involved.

French, Stemagen, Trounson and Egg Shortages

Biopolitical Times, the blog of the Center for Genetics and Society of Oakland, Ca., took a look recently at ongoing events in the human egg debate, including some developments at the California stem cell agency.

Jesse Reynolds, who has followed the California stem cell movement for years, also commented about research involving Stemagen of San Diego, which has created the first human clonal embryos.

Among other things, Reynolds wrote,

"The medical staff treating the egg providers share the same address, supervisor, and authorship credits as the Stemagen researchers, in violation of requirements that medical personnel not have conflicts of interest with researchers, so that doctors’ duty of care toward women providing egg isn’t compromised."

Reynolds also pointed out a relationship between Stemagen and CIRM President Alan Trounson.

Reynolds wrote:

"He helped recruit his old friend Andrew French from their common homeland of Australia to serve as Stemagen's Chief Scientific Officer. And Trounson, French, and Stemagen CEO Samuel Wood authored a 2006 paper advocating cloning-based stem cell research. So it wasn't surprising when Trounson took his first opportunity... at CIRM Standards Working Group to call for undermining California's prohibition on paying women (beyond their expenses) to provide eggs for research, even though this policy is enshrined in Proposition 71, the statewide initiative that created CIRM, the California Institute for Regenerative Medicine."

Reynold said that Susan Berke Fogel of Pro-Choice Alliance for Responsible Research reported that Trounson and CIRM Chairman Robert Klein "tag-teamed a renewed effort to find a tortured interpretation of Proposition 71 that would allow paying women for eggs" at the CIRM directors' meeting last month. Reynolds said Klein "tried to force a discussion" that would have changed policy and circumvented the Standards Working Group.

We were present during the discussion that Fogel heard. However, we did not have the same impression. There was a discussion of the shortage of human eggs, basically a brief recap of what Trounson told the Standards Working Group last February. Our take is that Klein brought up the subject before the full CIRM board perhaps with intention of setting the stage for some sort of action later this year. That would be the politic thing to do if he wants changes in CIRM's current policies on eggs and cash.

Later this year, the Standards Working Group is expected to conduct a review of CIRM egg policies, probably sometime this fall.

However, Klein and Trounson have a high hurdle to clear. Prop. 71, which Klein says he authored, requires CIRM directors to set standards "prohibiting compensation to research donors or participants, while permitting reimbursement of expenses."

While Reynolds pointed out links between Trounson and French, he also reported that the relationship apparently did not benefit Stemagen recently. Its application for a new cell lines grant was "raked over the coals" by reviewers, according to Reynolds, who quotes them at some length.

We are asking CIRM and Stemagen if they have any comment on Reynolds' posting. We will carry it when we receive it.

Multimillion Dollar Hooha Over CIRM Grant Reviews

As part of a burgeoning flap over grant reviews at the $3 billion California stem cell agency, one rejected applicant has formally asked for reconsideration of its request for funds, citing errors in fact by reviewers, among other things.

Such a request might seem routine, but for CIRM it is novel and fraught with pitfalls. At stake is the reputation for fairness and credibility of the still young California Institute for Regenerative Medicine.

Created only in 2004 with its first grants approved in 2005, CIRM has struggled with its processes. It has been helped, but also hamstrung by the ballot initiative that created it. The measure, which bypassed the legislature and the governor, also locked in a host of restrictive procedures. One of those involves the grant review process, which is also governed by policies approved by the CIRM board of directors.

The rejected applicant, Cascade LifeSciences of San Diego, was routinely denied funding last month by the CIRM board of directors, based on the decisions of scientific reviewers. The board has almost universally ratified the $500-million-plus decisions of its scientific reviewers, who conduct their sessions in private and whose economic or professional interests are not publicly known.

Rejected applicants do not have the right of appeal except in the case of a conflict of interest. But Cascade says it does not know the identity of reviewers of its grant so it is impossible to know whether a conflict of interest exists. However, the board itself is filled with conflicts of interest -- all legal -- that even Nature magazine has warned about.

Ken Woolcott, chief business officer for Cascade, appeared before the CIRM directors last month to express concern about the grant review process. At the time, he did not seek an appeal or reconsideration of the firm's application. He had been told by CIRM that no appeal was possible. After he left the meeting, another rejected grant, albeit in a slightly higher category, won funding after a CIRM director read a letter from the applicant.

On July 3, Woolcott wrote a letter to CIRM Chairman Robert Klein and CIRM President Alan Trounson that includes a request for reconsideration of his firm's grant. Woolcott's letter does not seek an appeal.

Much of the information in it is contained in an earlier posting on the California Stem Cell Report. But Woolcott has fine-tuned the letter and added important significant details. The entire letter follows as a separate posting. Here is a sample.

"The information on the 0.3% efficiency presented to the Study Section by the Reviewer #2 is factually incorrect. Even if the reviewer was mistakenly relying on our Nov. 2007 Nature publication, that efficiency was reported as 0.66%. More importantly, on pages 5 and 8 of this grant application we provided information that the efficiency of SCNT in primates was 3.3% (1 ESC line per 30 oocytes)."

We have asked CIRM if it has any comment on the situation. We will carry its response when it provides one. Here is the link to the public summary of the CIRM scientific review of the Cascade application.

Text of Reconsideration Letter From Cascade

Here is the text of the reconsideration letter from Cascade concerning its application for a grant from the California stem cell agency.

July 3, 2008
Mr. Robert Klein, J.D.
Chairman, ICOC Committee
210 King Street
San Francisco, CA 94107
Re: Request for Reconsideration - New Cell Line Development RFA 07-05 Review Process

Dear Committee Member:
Last Thursday evening, 26 June 2008, I had the pleasure of appearing before your Committee, officially on behalf of Cascade LifeSciences (See Exhibit A) and perhaps unofficially as a voice for industry, regarding our expectations and experience with the RFA and Grant Review noted above. To quote Mark Twain, “I apologize for the length of my letter; I did not have time to write a shorter one.” Three minutes to comment on a $1MM decision is remarkably challenging. For the benefit of the Committee and with the luxury of a written response, let me see if I can more clearly articulate our expectations, experience and suggestions going forward.

First, I would like to start at the beginning. Prop. 71 is a very innovative and groundbreaking paradigm shift in the funding of research. We applaud the CIRM mission and the stewardship of the Committee. The mission statement of Prop. 71 makes very clear that although science is a laudable goal it is not the end game. Products that treat, cure, or enhance our lives are the end game. Fast forward 10 to 15 years and I would like to be so bold as to suggest that the ultimate arbiter of the success of CIRM or Prop. 71 will be PRODUCTS. Not research achievements, not publications, not patents, not even Nobel Prizes. All of these are important milestones that will advance our efforts and may even contribute to the economy of California. But “John Q. Public” will only benefit directly by the development of innovative stem cell related PRODUCTS that I believe will change medical approaches to disease in fundamental ways.

In the interest of full disclosure, I prefer to admit my biases up front. I have a bias toward products. I am also a lawyer, the Chief Business Officer of Cascade LifeSciences, and a taxpayer. My product bias has been cultivated over 20 years with two of the San Diego biotech pioneers, Hybritech and IDEC. (See Exhibit B, Background). What I know about Stem Cells I have learned, but what I know about product development, I have lived.

I believe that industry and CIRM share the same goal of enhancing product development. Although funding cutting edge research and academic inquiry are part of the larger goal, I believe that industry will be the ultimate conduit through which products must run the clinical, regulatory and marketplace gauntlet.

RFA 07-05 and Cascade’s Expectations

Upon understanding that CIRM was opening up funding under the RFA process to for-profit entities, we were quite pleased and encouraged. Funding critically important translational research that can neither be funded by the NIH nor is of interest to all but a very few private investors seems prudent and product focused.

The specific language in the Objective of RFA 07-05 perhaps set our expectation too high:

Page 1 -- Somatic cell nuclear transfer (SCNT) , a method for reprogramming that is well-established in several mammalian species, has not yet been achieved with human cells, but recent success has been reported in non-human primates. " [This is Dr. Mitalipov's work published in Nature and exclusively licensed by Cascade]

Page 2. "The needs may in the future be met by derivation of hESC following SCNT..."

Page 2. "CIRM proposes a new program to address the need for new types and sources of human pluripotent stem cell lines and for the optimization of existing methods for their derivation." To be candid, we believed that the translation of our SCNT primate work into the SCNT generation of hESC was right in the "strike zone" of the RFA as written. The alternate non-embryo sourced approach, iPS is a very important scientific avenue of research and should be funded as well. That said, SCNT is a very compelling opportunity to develop genetically matched cell lines that may lead to human therapeutic products.

Cascade’s Grant Review Experience

Our responses to the Reviewers’ comments are beyond the scope of this letter but are attached as Exhibit C for independent review. For the record, we filed a formal request with Dr. Trounson to rebut the conclusions and comments of the reviews but were told by Staff that there was no such process. We were told that the only avenue for rebuttal would be based on conflict of interest. As the reviewers are anonymous, it is unclear how this would ever be realistic. Two additional points are striking in this regard. First, we now understand that after our departure on Thursday evening, Rusty Gage, one of our esteemed colleagues here in San Diego was allowed to rebut reviewer comments and, hence, did receive funding. We are unclear on how this rebuttal process works and why we were denied any opportunity to dialogue on the merits of our grant application. Second, I understand second-hand that an ICOC member believed my discussion at CIRM was flawed, for example, because I did not address the mistake regarding efficiency of our SCNT. This is unfortunate, as we were told our request for rebuttal was rejected and that we were not allowed to discuss the merit or lack of merit of the specific review of our application but our three minutes was limited to expressing our concerns about the process and our suggestions for improvement from an industry perspective.

By way of example, we would like you to better understand the disconnect between our expectations and our experience with this Grant Review. As you will note in Exhibit C, most of the review comments we received on our Grant Application were factually incorrect. We are unable to reconcile the review committees’ comments with the stated objectives of the RFA, the articulated criteria for review and our actual grant submission.

For example, Reviewer #1 comment was:
"Lack of Novelty, pure translation of the non-human primate work into humans."
This seems to defy logic and the mission of human therapeutics. Moreover, this does not seem to be consistent with the objectives published by CIRM in its RFA, which specifically calls out the "hurdle" of human SCNT as a fundable goal. I would venture to suggest that successful application of SCNT to humans will be a scientific achievement and will be an “above the fold” kind of worldwide news story. Finally, at the CIRM ICOC meeting, Dr. Uta Grieshammer, presented the review committees grant criteria and noted specifically that the review team was advised that "novelty" was NOT a priority for these types of grants.

Also at the meeting, Dr. Trounson announced that no SCNT grants had been funded due to some sort of vague policy concern about access to human oocytes and the challenges this had created in other countries. (We are aware of Grant#R31-00404 related to SCNT that was previously funded).

First, this was "moving the goal posts" after we had submitted our grant application. Second, we appreciate the challenge of securing oocytes but we at Cascade had been fortunate enough to secure a collaboration with La Jolla IVF clinic to supply all the oocytes we need to proceed with our cell line development effort. Moreover, if this was truly the reason for flagging our grant application as non-fundable, CIRM should have just told us that in writing and explained how they were going to proceed, if at all, in the area of SCNT.

A factually incorrect assumption about our “efficiency” may have been the fundamental error that doomed our application. The CIRM reviewer commented:
The ability to generate individualized human embryonic stem cell lines using somatic cell nuclear transfer from either healthy individuals or patients with specific disease states is an exciting and yet technically demanding prospect. To date, no one has successfully cloned human embryonic stem cells, although recently, a group at University of Oregon Heath Sciences Center has successfully derived primate embryonic stem cells, with an efficiency of approximately 0.3%
This is factually incorrect at two levels. First, we are unclear where the reviewer got the 0.3% efficiency rate. This is not a number we have used. Our November 2007 Nature paper calls out 0.66% efficiency at page 497. Our grant application (filed Jan 2008) describes in detail at page 8, "These results represent a significant reduction in the number of oocytes required to produce a single ESC line over previously reported efficiency (from 152 to 30) providing the important foundation to conduct the proposed studies in humans." 1 ESC cell line out of 30 oocytes is actually 3.3%.

I am unclear how this fundamental oversight occurred. Mistake? Miscommunication? Pre-existing bias? Misunderstanding? Suffice it to say, we believe that the incorrect information about efficiency was the driving force behind the reviewers’ comments and failure to fund.

Suggestions and Action Items for Consideration.

Our hope is that thru expressing our concerns and our experience we will be able to make industry (For-Profit) a viable partner in the mission of Prop 71. With that in mind, we would like to suggest the following ideas for review and consideration by the ICOC:

Industry representation on CIRM grant review teams

Formal appeal process or ability to respond in writing to reviewer comments. See, for example, SBIR, STTR, NIH funding for models of review cycles.

Holding the review team to the published review criteria--e.g., novelty is not a priority criteria.

One of the review criteria should always be the impact of the research on the advancement of human product development. If the Rusty Gage review reconsideration is as I understand it, it seems that there is one set of rules for a deservingly prominent scientist and a different set of rules for Cascade LifeSciences/Industry. We also filed a letter with CIRM asking for the opportunity to comment on our grant review and were denied. This seems, without more complete information, to be unfair.

Perhaps separate academic/not-for-profit grant application review from for-profit review. Comparing not for profit grants (institutions that are Grant Writing Machines) with the grant applications of fledgling biotech companies is fundamentally unbalanced.

Although I believe that Industry is a key element of Product development and we desire to work with CIRM to advance the cause, if CIRM’s funding criteria or standards are inconsistent with industry participation or pragmatic product development, we need to know that earlier rather than later.

I am personally and professionally committed to assist CIRM in making industry an equal partner in achieving the mission of Prop 71. I would look for guidance from the ICOC on how we can work through some of these administrative and structural challenges.

Although we are disappointed by the CIRM review and admittedly discouraged by the process, I trust that the agency and the applicants will evolve favorably with time and experience.
As our distinguished Governor would say.............."We'll be Back."
Sincerely,

Kenneth J. Woolcott
Chief Business Officer
Cascade LifeSciences Inc
10398 Pacific Center Ct.
San Diego, CA 92121
kjwoolcott@aol.com
858-945-4667

KJW/rrc
cc: Alan Trounson, President CIRM
Howard Birndorf
Sophia Khaldoyanidi


Exhibit A

Cascade LifeSciences

Founded 2004
San Diego, CA
Howard Birndorf, Chairman
Kenneth Woolcott, Chief Business Officer
Sophia Khaldoyanidi, Ph.D, MD, Chief Scientific Officer
Larry Respess, General Counsel
Exclusive Licensee of Novel SCNT technology developed at Oregon Health Sciences University (OHSU) and published in Nature, Nov 2007. (First successfully SCNT in Primates)
Dr. S. Mitalipov, inventor of SCNT patents and consultant on human SCNT effort.
Exhibit B



KENNETH J. WOOLCOTT


6100 La Jolla Scenic Drive South
2000 First Avenue
La Jolla, CA 92037
Suite 2304
858-454-8496 phone/fax
Seattle, WA 98121
kjwoolcott@aol.com
206-795-4667 phone


GENERAL COUNSEL & LICENSING EXECUTIVE
Strategic Advisor . . . Entrepreneurial Counsel . . . Transactional Architect


Summary: Executive with over 20 years of experience and outstanding accomplishment in the Biopharmaceutical Industry, including 12 plus years of key legal and management responsibilities at IDEC Pharmaceuticals Corporation (now Biogen IDEC) through its growth from a market cap of $50M to a company with a valuation of over $10B. Provided counsel and craftsmanship on over $1B in global corporate alliances and public financings. Contributed legal leadership and team influence in the development and FDA approval of two oncology drugs, RITUXAN (first antibody approved for cancer) and ZEVALIN (first radioimmunotherapy approved for cancer), currently generating annual U.S. sales of over $1.9B. Provided leadership in diverse and challenging roles based on the growth and needs of the organization, for example:

Strategic advisor with entrepreneurial zeal and global biopharma perspective.
Counsel with intra-disciplinary experience, scientific background and a proven track-record of incisive legal analysis and problem-solving.
Executive officer with achievement in operational management, strategic planning, business development, team building, and change agent in development of company’s core values as it grew from 70 to over 800 employees.
General Counsel and Corporate Secretary with broad experience in public company matters, corporate governance, SEC compliance, FDA issues, intellectual property strategy, transactional negotiation and crafting, corporate partner management, litigation management, and government relations.
PROFESSIONAL EXPERIENCE AND KEY METRICS

Woolcott Bioscience Strategies 2002-present
Transactional and Business Development Consulting Services

Chief Business Officer, Cascade Lifesciences Inc 2007 to present

Strategic Advisor 2005 to 2007
Nativis, Inc. San Diego, CA

Acting Vice President, Business Development & General Counsel 2004-2005
Imagine Pharmaceuticals, San Diego, CA




IDEC Pharmaceuticals Corp., San Diego, CA 1989-2002

VP, General Counsel, Licensing Executive and Secretary 1994-2002
General Counsel, Licensing Executive and Secretary 1992-1994
Deputy General Counsel and Secretary 1991-1992
Intellectual Property Counsel 1989-1991

Counsel to approximately $700M in IDEC Public Equity & Debt Financings:

Initial public offering (IPO): (1991--$52 M)
Follow-on equity offerings: (1994 – $8M; 1996 -- $50M; 2000 -- $473M)
“LYONS” convertible debt offering: (1999 -- $113M)

Counsel and negotiator for approximately $300M in corporate alliances from 1991-00, including:

Zenyaku/Rituxan – 1991, $10M SmithKline/CD4 – 1992, $60M
Mitsubishi/B7 – 1994, $12M Seikagaku/CD23 – 1995, $26M
Genentech/Rituxan – 1995, $57M Eisai/gp39/CD40L – 1995, $38M
Kirin, BI, and Chugai/ Upjohn/9AC – 1997, $12M
Expression System – 1995-7, $15M
Schering AG/Zevalin –1999, $47M Nordion /Yttrium – 2000, $20M
Member of core team of executives that led turnaround from $50M valuation and six months of cash in 1994 to pivotal Genentech partnership/cash infusion and over 800% increase in stock valuation in 1995.
Managed key patent litigation (IDEC v. Corixa et al), including selection process for lead counsel and development of declaratory judgment strategy over a multi-year period. Strategically, IDEC prevailed in securing venue in San Diego Federal District Court, while actions in Delaware and Northern District of California were dismissed. In October 2003, summary judgment was granted in favor of IDEC declaring invalid and unenforceable all of Corixa’s subject patents. The case was ultimately settled on favorable terms
Executive Committee level advisor on IND, clinical strategy, Advisory Committee meeting, manufacturing subcontracting and inspection, approval and launch of RITUXAN and ZEVALIN.
Early advocate and adopter of Rule 10b-5 executive stock selling plans, including successful initiation of amendment to California State Securities Laws to conform with provisions of new Federal law
Managed preparation and filing of SEC corporate disclosure documents including crafting of numerous sensitive and challenging press releases.
Managed legal aspects of “Poison Pill” adoption and revision
Lead legal analysis and selection of RITUXAN and ZEVALIN trademarks
Coordinated legal and peer analysis for stock splits 2:1 21 Dec ’99 and 3:1 18 Jan ‘01
Built and managed a high-performance Legal Team of thirteen professionals
Managed Corporate Policy on Insider Trading and Stock Trading Windows
Member of Executive Committee, Corporate Secretary and liaison with Board of Directors
Strong presentation skills and recognized public speaker

Christensen, O’Connor, et al., Seattle WA 1987-1989
Associate


Hybritech, Inc., San Diego, CA 1985-1987

Intellectual Property and Licensing Counsel 1986-1987
Patent Counsel 1985-1986

EDUCATION
George Washington University, Washington, D.C.
Juris Doctorate, 1985
Leader, Save the Night Law School Campaign, 1984
President—Evening Division, Student Bar Association, 1984

University of Maryland, College Park, MD
MS candidate/Chemical Engineering, 1980-81

Pacific Lutheran University, Tacoma, WA
B.S,. Biochemistry, Cum Laude, 1980

PROFESSIONAL ORGANIZATIONS

California State Bar Association
Washington State Bar Association
District of Columbia Bar Association
United States Patent Office
Registered Patent Attorney (#30,824)
American Corporate Counsel Association
Founding Director of San Diego Chapter, 1994
American Association of Corporate Secretaries
Biotechnology Industry Organization
Founder of General Counsel Committee, 2001

COMMUNITY AFFILIATIONS

Burnham Institute for Medical Research, La Jolla, CA
Trustee and Chairman of Technology Transfer Committee., 2004 to present
Basketball Club of Seattle, L.L.P.
Partner, 2002 to 2006
The Jimmy V Foundation for Cancer Research
Friends of V Member
The Starlight Foundation for Children
Freshstart , Inc.




Exhibit C

Rebuttal letter & REQUEST FOR rECONSIDERATION
sophia Khaldoyanidi, ph.d., m.d.,
chief scientific officer
cascade lifesciences, inc.

RL1-00656-1: Generation of human ESC lines using SCNT
Executive Summary Comments
Comment #1: The proposal lacks a detailed description of how the resultant cell lines will be assessed and characterized for pluripotency.

Response #1: This concern was raised by the Reviewer #2. However, the description of the pluripotency tests is described on page 5 of the grant application (Step 4 of our protocol). We proposed to evaluate pluripotency of SCNT-ESC lines based on stemness marker expression and both in vivo and in vitro differentiation using standard state-of-the art methods. These methods include immunocytochemistry, flow cytometry, quantitative RT-PCR, embryoid body formation and teratoma assay. All these assays are standard in stem cells biology field and are routinely used by the members of our scientific team (see list of publications provided in Part C of this grant application).

Comment #2: No data is presented suggesting that these assays [for pluripotency] are routinely available in the applicant’s laboratory.

Response #2: Due to the space constrains of the Preliminary Results and Feasibility section (2 pages), we have chosen to present the results supporting the novel and scientifically-challenging aspects of the SCNT technology. The concern regarding our ability to run the pluripotency tests was raised by the Reviewer #2 and the rationale for this concern is not clear to us: the assays for pluripotency are standard techniques used in every stem cell laboratory including laboratories leaded by the members of our scientific team. The fact that we are familiar with the standard techniques used in our field is supported by our publications (Part C of this grant application).

Comment #3: The collaborator with the primate cloning expertise proposes to spend 25% of his/her time in the applicant’s laboratory in California. However, reviewers expressed serious concern that it will be logistically difficult for the out-of-state collaborator to be available at the time when the oocytes are donated.

Response #3: Anyone with experience with IVF understands that the day of oocyte harvesting is predicted in advance based on the rigid hormone treatment schedule for each donor. Based on this well known schedule, the travel for Dr. Mitalipov from Portland to San Diego (2.5 hour duration) can be easily planned in advance.

Comment #4: Regarding the source of the oocytes, which will be obtained from an in vitro fertilization (IVF) clinic, one reviewer felt that the procurement of 100 oocytes per year seems reasonably achievable. However, others felt that not enough information is presented in the application to firmly support that the applicant can obtain the high quality eggs.

Response #4: Due to the space constrains, we did not have an opportunity to explain in the body of the grant as to how human oocytes will be obtained. This information is provided very clearly in the letter of collaboration from Dr. Smotrich of La Jolla IVF Clinic (Part C). Dr. Smotrich established a list of young and healthy volunteers who desire to donate oocytes specifically for this SCNT project. All these donors were pre-tested and demonstrated a high oocyte production (20-25 oocytes per cycle) in response to hormonal stimulation. We do not intent to use oocytes that have been obtained for the purpose of IVF treatment and were not used due to poor quality.

Comment #5: If they [Cascade LifeSciences team] have access to 100 eggs, some reviewers argued that it would not be enough to make a cell line in 1 year, given the primate success rates (0.3%).

Response #5: The information on the 0.3% efficiency presented to the Study Section by the Reviewer #2 is factually incorrect. Even if the reviewer was mistakenly relying on our Nov. 2007 Nature publication, that efficiency was reported as 0.66%. More importantly, on pages 5 and 8 of this grant application we provided information that the efficiency of SCNT in primates was 3.3% (1 ESC line per 30 oocytes)

Comment #6: Reviewers mentioned that there is no consideration of how the resultant cell lines, if any, will be distributed to other research groups and under what conditions as requested in the application.

Response #6: This is factually incorrect. This concern was raised by the Reviewer #2. However, this information has been provided on page 10 of the application (last paragraph).
In summary: Our response demonstrates that the Reviewer #2 provided factually incorrect information to the Study Section. In particular, the efficiency (which is an important parameter) was erroneously reported. Moreover, despite the challenges others may legitimately face in securing oocyte donors, we were able to secure reliable and excellent source of oocytes to advance our work in humans. Finally, to suggest our proposal is not novel is a flawed conclusion as Human SCNT is a stated goal of the RFA and the stated RFA review criteria specifically noted that “novelty” was NOT a measure for funding. As a result of these factual errors and an unknown change in SCNT funding philosophy in mid-review, our project received a non-fundable score. We requested an opportunity to rebut. We were denied.
REQUESTED ACTION: We respectfully request that the ICOC reconsider our grant application for funding.

CIRM's Grant Review Process: Complaints About Errors and Appeals

California's stem cell agency has pumped out more than $554 million in awards for stem cell research, but this year grumbling has emerged about its secretive awards process, which officially does not permit rebuttal in the case of errors and allows appeals only in the case of conflicts of interest.

On Sunday, reporter Terri Somers of the San Diego Union-Tribune became the first mainstream media writer to examine the issue in some detail.

Somers used June's meeting of the CIRM board of directors to discuss the subject, including additional interviews with researchers.

Somers wrote that CIRM is

"...basing its funding decisions on recommendations from panels of scientists who sometimes make significant factual errors in their reviews of grant requests, some applicants say.

"Yet there is no way for applicants to point out or rebut the errors – at least not through a formal appeals process, such as the one used by the National Institutes of Health.

"'I cannot tell you how frustrating it is to get turned down for a grant and have no recourse other than to shred it and all the time you spent doing it,' said Jeanne Loring(see photo), a researcher at the Scripps Research Institute in La Jolla.

Somers said CIRM has no plans to change its policies concerning appeals or error. She quoted CIRM Chairman Robert Klein as saying the NIH appeal process is too slow for CIRM. He said an NIH appeal can take as long as two years.

Somers did not raise the closed-door nature of the grant reviews as an issue, but applicants do not have access to the proceedings. Nor do apparently many of them know that they can appear publicly before CIRM directors and ask them to change the recommendations of scientific reviewers or even write a letter to that effect.

Directors have final authority on grant approval but generally ratify decisions of the scientific reviewers, without even officially knowing the identities of the research applicants. Their identities are withheld but in many cases can be discerned through the public summary of reviewers' comments.

Somers quoted one CIRM director, Jeff Sheehy of the University of California, San Francisco, about the review process. Sheehy is also a patient advocate member of the CIRM grant review group and played a role last month in airing concerns by one scientist, Fred Gage of the Salk Institute.

Sheehy told Somers:

"We may have missed some good science, but I don't think we have funded (bad science)."

While CIRM does not plan changes in its review process, Klein did tell Somers about one option for disgruntled applicants. She wrote:

"If a scientist wants to rebut an error of fact of great scientific importance, he or she should point it out to institute President Alan Trounson or Chief Scientific Officer Marie Csete, Klein said.

"Those scientists could then sort out the issue with the reviewers and decide whether it needs to be brought to the board's attention, he said."

Our take: If that is CIRM policy, all applicants should be informed about that possibility as they apply. Fairness and the appearance of fairness are critical to CIRM's credibility.

Here is a link to a detailed critique by one applicant and our report from the June meeting of CIRM directors.