Day 153 of the Wechsler-Reya Affair: Near Silence from All Quarters

California's $6 million, long-running courtship of a pair of Duke Blue Devils has apparently not been consummated.

But, like many other consummations, it is not easy to tell. Silence is the watchword on the part of those who know.

Last April, the California stem cell agency offered a $6 million signing bonus to Robert Wechsler-Reya, a researcher at Duke University, to move to La Jolla's Sanford-Burnham Institute. The award is part of a two-year, $44 million taxpayer-financed effort to help recruit scientists to California.

Sanford-Burnham is also providing “an extremely generous commitment of laboratory space, matching funds for equipment, additional support for relocation and research, and access to excellent core facilities,” CIRM grant reviewers said.

But the multimillion dollar enticement did not make the Duke pair jump with alacrity. Wechsler-Reya told the California Stem Cell Report last spring he had not made a decision. That situation seems to be unchanged today.

On Monday, we queried Wechsler-Reya about whether he and his wife, Tannishtha Reya, also a stem cell researcher, will take their work to Sanford-Burnham. So far he has not responded. CIRM remains mum as well, failing to answer our questions from Monday.

Andrea Moser, vice president for communications at Sanford-Burnham, however, did say something.

“At the current time, we do not have an update on the Wechsler-Reya recruitment.”

In April, the $3 billion stem cell agency tried to impose a June 30 deadline on the courtship. CIRM President Alan Trounson told directors that Sanford-Burnham had assured him the deal would be done by then.

One reason that directors wanted the matter settled was competition for more of the signing bonus cash. If the Duke researcher was not coming to California, more money would be available to help other institutions lure scientists to the Golden State. CIRM reviewers held a closed-door session last week to make decisions on those applications, but no news was forthcoming from that event.

So we are now into Day 153 of the Wechsler-Reya Affair. Stay tuned for all the developments.

(Editor's note: We started counting the days beginning with the Feb. 18 application deadline for the grant.)

(Wechsler-Reya photo)

Stem Cell Directors Postpone Action on Troubled Appeals Process

Directors of the California stem cell agency today delayed action on moves to reshape the “broken” grant appeal process at CIRM.

In response to a query about the outcome of the directors' Science Subcommittee, Don Gibbons, chief of CIRM communications, said,

“A lengthy discussion resulted in agreement to continue the discussion rather than take action at this time. It was generally agreed that any re-scoring request from the board should be a rarely used option.”

CIRM's board of directors has been bedeviled by problems with the appeals process for 2 1/2 years. The directors' new Science Subcommittee began to address the issue late in May.

More details on the directors' thinking on the problem will have to await the unveiling of the meeting transcript in about two weeks.

Biopolitical Times Questions Rationale for Future CIRM Funding

The case that California stem cell Chairman Robert Klein is trying to make for more funding for the $3 billion research effort rings hollow, according to the Center for Genetics and Society.

Writing on the group's Biopolitical Times blog, Jesse Reynolds, the Berkeley center's project director on biotechnology accountability, said that another ballot measure for stem cell research would fail. He said,

“...(I)nstead of the promised cures of the Proposition 71 campaign, reality-based voters see dramatic cuts in the state's essential services, liberalized federal funding of embryonic stem cell research, and a potential alternative in cellular reprogramming.”

Reynolds made his comments in the wake of a cover story in the San Francisco Examiner about the state of CIRM. Reynolds wrote that Klein “unsurprisingly defends its continued funding.”

Reynolds continued,

“But Klein’s arguments ring hollow. First, he cites an economic study that concludes the program has generated significant tax revenue. But that study's conclusions were controversial, and in any case $100 million is far less than the billion dollars the CIRM has already spent. The program is certainly not paying for itself, as he suggests now and as he claimed before the vote on Proposition 71.

“Second, Klein cites reduced health care costs. He goes so far as to say, 'First of all, we’re saving lives.' While I sincerely hope that embryonic stem cell research leads to therapies, that is not yet the case. Clinical trials are yet to begin. (Maybe next year?) Until there are genuine therapies, such savings remain hypothetical.”

CIRM Seeks Communications Coordinator

The California stem cell agency is still looking for a “communications outreach coordinator” to help beef up its public relations efforts.

The agency has re-posted the RFP for the $85,000, 12-month job after apparently not being satisfied with the earlier round of applicants. The part-time position also includes a $10,000 travel budget. The winning applicant will be expected to work 20 to 30 hours a week.

Among the responsibilities for the position are three CIRM town forums, Stem Cell Awareness Day, relations with patient advocacy groups and assistance in developing material for use in advocacy group meetings.

Deadline for applications is July 30.

UC Davis Scientist Praises CIRM Appeals Change

A stem cell researcher at UC Davis today said a change in the CIRM grant appeals procedure makes “a lot of sense.”

Writing on his blog in regard to "extraordinary petitions," Paul Knoepfler said,

“I think the proposed change makes a lot of sense and would greatly improve the process. Sometimes the reasons in the petitions are clearly not meritorious and as it now stands, they end up wasting CIRM's time. The last time CIRM received 9 petitions as well, which represented a remarkably large fraction of the total applications. A stricter process would discourage the submission of large numbers of petitions, an important issue given that the number of petitions received by CIRM continues to grow.

“As someone who has submitted dozens of grant applications over the years to many different funding agencies, I know how it feels to get applications unfunded and receive critiques I may not agree with. It is not fun. It is especially difficult when one is near but below the funding cutoff. However, it happens all the time.

“I think CIRM might consider a bit stronger language in their policy on appeals making it clear that appeals should only be filed in very limited circumstances and that appeals found to be without merit will be frowned upon.

“In other words, don't file an appeal simply because the rules theoretically allow you to and/or you are grumpy about how your grant application was received. Such frivolous appeals may affect your reputation.”

Knoepfler also received a comment from Jeff Sheehy, chairman of the CIRM Science Subcommittee, which will be considering the changes. Sheehy said,

“One thing that I think confuses folks is the lack of control we have over what comes to the Board.  As a public body, we're governed by State open government-Bagley-Keene rules (which I strongly support, btw).

“On any matter under consideration by the Board, any member of the public can speak to the matter or provide documents to Boardmembers.  Within that legal reality, we can only channel and not reject 'extraordinary petitions.'”

Whither Wechsler-Reya? A $6 Million Stem Cell Tale

Is a high-flying stem cell researcher from Duke coming to California to claim his $6 million grant from the state's $3 billion stem cell agency?

Can the prestigious Sanford-Burnham Institute in tony La Jolla, Ca., lure him and his wife away from their spots at the Gothic Wonderland, as Duke University is sometimes known?

The answers to these and other questions are still a mystery despite a quasi-deadline for the giveaway imposed by the 29 directors of the Californa Institute for Regenerative Medicine.

The will-they or won't-they matter involves Robert Wechsler-Reya and Tannishtha Reya, another Duke researcher.

The couple is being or has been recruited by Sanford-Burnham with the help of the multimillion dollar grant from California taxpayers. Directors of the state stem cell agency approved the award in April.

At the time, directors appeared to be initially unaware that the deal was not done. Wechsler-Reya told the California Stem Cell Report that he had not made up his mind on whether he would become a latter-day California argonaut.

According to the transcript of the April 29 CIRM board meeting, Chairman Robert Klein said he wanted a “definitive time” for conclusion of the Wechsler-Reya recruitment. CIRM President Alan Trounson said that Sanford-Burnham said it would be finished by the end of June. He told directors,

“We're reassured that that will be the case.”

Sanford-Burnham has announced other hires this month, but did not mention the Duke researchers. Earlier this month, we asked CIRM about the situation.

Amy Adams, communications manager for the agency, replied on July 1,

“The deadline in the RFA is for funding to start within six months after ICOC approval. At the ICOC meeting, there was agreement that it would be desirable to know Dr. Wechsler-Reya's decision before the next review so that we know how many slots remain, and the hiring institution agreed that would be reasonable. It was also stated that we hoped to have the recruitment resolved by the end of June, which has not happened.”

Wechsler-Reya has not responded to a request for comment. We are asking both him and CIRM again about the matter.

CIRM Finally Discloses Grant Appeal Proposals

The California stem cell agency early today belatedly posted a two-page memo on proposed changes in how it will deal with appeals by scientists whose grant applications have been rejected by reviewers.

The information comes only one business day before a meeting of the CIRM directors' Science Subcommittee to consider alterations in the appeals process. The changes deal with an issue that has been publicly troubling the CIRM board for 2 1/2 years. Many CIRM directors are unhappy with a situation that finds researchers publicly appearing before the board to press their cases. One director has described the process as “broken,” a description that others would likely use.

One proposed change provides for “re-scoring” of applications when directors are unable to make an "informed decision" at the board meeting at which an application is considered. The re-scoring would occur when “a material dispute of fact exists or when new information that is not available at the time of the initial review has come to light.”

The staff memo said,

“Programmatic issues, such as whether the agency’s portfolio is well-balanced among diseases, should not be a justification for re-scoring, nor should clear errors in the review of an application that have been identified by staff and presented to the board.”

Other changes would stipulate that CIRM staff would not respond in writing to the board on “extraordinary petitions” unless they believe the petition has merit.

Applicants would be advised that they may submit a petition – which is tantamount to an appeal – five days before the CIRM board is to consider their application “if they believe a material error or omission in the review of their application may have affected the recommendation made by the Grants Working Group to the board.”

Staff summaries of reviewers' recommendations would also cover the “majority views and the minority views, when there is a major difference of scientific opinion between large blocks of reviewers (e.g. eight speaking against and five in favor).”

As we have noted, it is a dismal commentary on CIRM that it has taken the agency until now to post the two-page document on the proposed changes. The agency cannot expect well-considered comments or questions from the hundreds of affected California scientists when it discloses information only one business day prior to the meeting at which a matter is to be considered. Indeed, we suspect that most California stem cell researchers are not even aware that CIRM is considering changes tomorrow that could affect their livelihood and work. That is not to mention that CIRM's belated posting does not come close to meeting the pledge of CIRM Chairman Robert Klein that the $3 billion research effort will adhere to the highest standards of openness and transparency.

Sticky, Troubling Appeals by Rejected Researchers Targeted by Stem Cell Agency

A key step in the process for awarding billions of dollars in research grants is “broken,” according to many directors of the California stem cell agency, and major changes are looming that will affect hundreds of scientists.

Just what those changes are likely to be is unclear. The stem cell agency has not made available to the public any drafts of likely proposals or other related material for a meeting on the matter that begins in only one business day. The only information on the agenda for the directors' Science Subcommittee says: “consideration of changes to extraordinary petition and grant administration appeals processes.”

(Editor's note: Hours after this item was posted, CIRM added material to its agenda that outlined the proposed changes. You can find more on the plan here.)

Nonetheless, specific proposals are virtually certain to come out of the session. Those would then go to the full board meeting on Aug. 18 for ratification and perhaps modification.

Many CIRM directors have long been uncomfortable dealing with public appeals by applicants rejected by the agency's grant review group. On the first such occasion in January 2008, Gerald Levey, a CIRM director and then dean of the UCLA Medical School, said, "I don't think we can run a board this way. If we do, it would be chaos."

Eight months later, directors approved the use of “extraordinary petitions” by applicants. However, that has not eased the situation. Last month directors were hit with a record nine petitions and overturned negative decisions by reviewers on four grants, also a record.

The Science Subcommittee first dealt with the appeals process on May 25. According to the transcript, the panel's chairman, Jeff Sheehy, a patient advocate and communications manager at UC San Francisco, said during the brief discussion,

“This is a broken process. I think almost everybody on the board would agree that it is.”

Duane Roth, co-vice chairman of the CIRM board and a San Diego businessman, said,

"This is one that I think really needs to be rethought completely because what we have right now doesn't seem to be working. Even the extraordinary petitions, I think with the exception potentially of one which we responded to, we agreed with the reviewers. And then in the board meetings turned around and disagreed with our own disagreement. And I think we just don't want to do that.

"Second, I think we're inviting very bad precedent behavior by opening ourselves up to the kinds of things that we went through at the last meeting. We just invite people to continue to do that. I'd like to see us find a solution for grievances on the reviews that everybody can get behind and endorse and embrace."

Among the suggestions in May was one from Sheehy to create a “re-review” option. Facing an appeal, directors could send an application back to the review group for re-evaluation in the light of comments from an applicant. CIRM directors almost certainly already have that authority although it has never been used or formally articulated. Prop. 71 makes the CIRM board the final arbiter on applications. Directors can do anything they want with an application. In practice, however, the grant review group makes the de facto decisions with the board intervening in only a tiny percentage of cases.

Sheehy, who is also a member of the grants review group, additionally said he would like the bifurcated appeal process consolidated. Currently, an “appeal” can only be made on the grounds of a conflict of interest. However, those reviews are done behind closed doors and applicants do not know the identity of reviewers charged with close evaluation of their proposals. Conflict appeals are handled privately by CIRM staff and do not normally come before the full board. Extraordinary petitions are technically not appeals, according to CIRM, but in reality serve that purpose.

Complicating the whole matter is the fact that any scientist or member of the public can speak directly to the board at its meetings on any matter, including rejection of applications. They can also write or email the directors. That is a matter of law and cannot be changed by CIRM rules.

At the May subcommittee meeting, CIRM President Alan Trounson discussed the public appearances of researchers. He said,

"It makes it very difficult on the spot to try and provide the board with the kind of information that they need."

Trounson also said the schedule for petitions is tight and comes only days before a board meeting, making it difficult for CIRM staff to evaluate the issues that are raised. However, some petitions are being presented to the board even though they have not met the deadline for submission.

Art Torres, co-vice chairman of the board and a former state lawmaker, suggested that applicants sign a document stating that they have read the rules for filing petitions. CIRM Chairman Robert Klein concurred with that suggestion.

Whatever comes out of Tuesday's meeting, it is a dismal commentary on CIRM that it cannot or will not provide timely information to the public and its stakeholders about how it plans to handle this portion of $3 billion in taxpayers' business.

Here is a link to a reading list, prepared by the California Stem Cell Report, of articles and CIRM documents on appeals and extraordinary petitions.

New CIRM VP Lewis and Ambit Biosciences

The new, part-time interim vice president for research and development at the California stem cell agency, Alan Lewis, also is executive chairman of Ambit Biosciences, a privately held biotech firm in San Diego. That information was not included in CIRM 's news release on his role at the agency.

We asked Lewis by email about his work at Ambit and told him we would carry his responses verbatim. He responded directly and quickly. Here are the questions and his answers.

California Stem Cell Report (CSCR): When did you become executive chairman of Ambit?
Lewis: “Approx May, 2010."

CSCR: What responsibilities does that entail?
Lewis: “It is similar to being board chair except Ambit is seeking a new CEO so I am the 'sign off' person who speaks once a week to three key staff. Also responsible for helping to create board agendas, and I am a member of the compensation committee.”

CSCR:Is the position compensated? If so, how much?
Lewis: “Typical of biotech boards--approx $25k/year. This consists of an annual fee plus board meeting fee.”

CSCR: Do you plan to continue as executive chairman while you are serving as interim VP at CIRM?
Lewis: “Yes. It involves approx five meetings per year in San Diego, and will have less responsibility as soon as the new CEO joins, probably mid-later July this year.”

CSCR: Do you see any conflicts of interest of any sort involving CIRM and your role at Ambit?
Lewis: "No. Ambit has no interest in regenerative medicines or cancer stem cells. They are focused on kinase inhibitors for cancer and inflammatatory diseases.”

CSCR: Were you a candidate for the VP position as a fulltime employee at CIRM?
Lewis: “No.”

CSCR: Do you plan to seek any other position at CIRM or on the CIRM board in the future?
Lewis: “Not given this any thought – probably not.”

Correction

On July 2, we incorrectly reported that the consulting contract CIRM has with Alan Lewis was not mentioned at the June meeting of the governing board of the California stem cell agency. Our apologies to CIRM President Alan Trounson for getting this wrong. In fact, Trounson announced that Lewis would serve as a consultant two or three days a week.

Here is the text of what Trounson told the board, according to the transcript.

“We're having difficulties in that area(selection of a vice president for research and development), difficulties in attracting someone because of the high salaries of these very competent people in the industry to join us. So we're still in research mode at the moment, but I should let you know that Alan Lewis, who just stepped down from the Junior Diabetes Research Foundation, is going to join us as a consultant to work two or three days to help us with the clinical, preclinical programs. He's a terrific guy. I think most of you would know him. And he's agreed to become a consultant for the time being while we're still in search mode.”

Appeals on Stem Cell Grant Applications: CIRM's Upcoming Re-examination

If researchers want to be successful at winning some of California's stem cell billions, they should set aside time this month to consider or comment on likely changes in policies that will affect their livelihoods.

The California stem cell agency is re-examining the process by which scientists can appeal negative decisions by reviewers on their applications for grants and loan. This reaches beyond academia and affects business applicants.

Little is known at this point about exactly what the agency is proposing to do. The July 20 meeting of the directors' new Science Subcommittee was just announced this weekend, and no background information has been posted. CIRM has two processes involving appeals: extraordinary petitions and “normal” appeals, which are based only conflict of interest issues.

CIRM directors have long expressed exasperation with the appeals process. In fact, they created the extraordinary petition procedure to deal with the issue. A host of articles dealing with the appeals process can be found on the California Stem Cell Report by searching on the terms “extraordinary petitions” and “appeals.”

If researchers or the public cannot make it to the teleconference locations for the meeting, they can send their comments by email to the agency (mking@cirm.ca.gov).

Also on the agenda is consideration of commissioning an Institute of Medicine study of CIRM and a plan to add funds to the new clinical trials grant round, now slated for $50 million. The clinical trials RFA is scheduled to be posted this month and is likely to involve a firm whose financial backers pumped nearly $6 million into Prop. 71, which created the stem cell grant program.

Teleconference locations for the meeting can be found in San Francisco(2), Duarte, Irvine (2), Healdsburg, Stanford, Palo Alto and Pleasanton. Specific addresses are on the agenda.

Klein Defends Burgeoning CIRM Budget

The San Francisco Examiner today published a couple of stories focusing on how the $3 billion California stem cell agency is immune to the budget pressures that face the rest of the financially troubled state.

Katie Worth wrote,

“...(N)ary a paper cut has injured the budget of the state-funded California Institute for Regenerative Medicine.

“In fact, last month, the 5-year-old agency’s largest operating budget ever was approved. Its out-of-state travel budget will more than double this year. Later this year, agency leaders hope to receive a legislative OK to expand the staff beyond the voter-mandated limit of 50 employees. The agency just hired a new vice president on a part-time basis: He will work about 24 hours a week for six months, and be paid $250,000.

“The agency chairman (Robert Klein) said all of these expenditures are justified because the research the agency has funded is well on its way to saving lives. In fact, he said once the current unbroken flow of cash begins to slow, the agency will be able to make a strong case to voters that they should fund even more research.”

SF Lawyer Urges Openness at Stem Cell Agency

Writing in connection with an incident in which two persons were barred from a CIRM meeting, a San Francisco attorney this week called on the California stem cell agency “to return to its commitment to an open and public process.”

Justine Durrell, who is involved in issues dealing with biotech and women's health, made the comment in a three-page letter to the 29 members of the board of directors of the $3 billion research effort. Her letter referred to the item last month in the California Stem Cell Report describing the incident at a San Francisco hotel.

Durrell raised a series of question in connection with the meeting and its implications for procurement of human eggs. Among them were the absence of public notification about the meetings, the justification for exclusion of the public and CIRM's lack of funding for research into the health consequences on women who provide eggs for research.

She wrote,

“Additionally, I emphasize the importance of CIRM's return to its commitment to an open and public process. In the end, openness and transparency will better serve all Californians. Please obviously post in advance all meeting times and locations, the agenda, whether they are open or closed (the justification therefore), and the transcripts/minutes/reports following the meeting.”

You can read Durrell's entire letter here.

Open Meeting Letter -- Justine Durrell to Stem Cell Board

Campaign Contributors, iPierian and the California Stem Cell Agency

Major contributors to the Prop. 71 campaign are pumping more of their own cash into a South San Francisco stem cell firm that has received $1.5 million from the state agency that they helped to create in 2004.

The firm, iPierian, Inc., also has plans to seek additional millions in the near future from the California stem cell agency. The new venture capital funding round announced by the firm today may well be tied to that application.

Ipierian's news release additionally disclosed major new support from another enterprise tied to a Prop. 71 campaign contributor. Ipierian said Google Ventures had joined the firm's backers in the $22 million funding round. Google Ventures will get a seat on the iPierian board as a result of its investment in the company. Sergey Brin, co-founder of Google, made a $100,000 contribution to the Prop. 71 campaign in 2004. (For more on that subject, see the last few paragraphs of this item. )

Other investors in iPierian, including John Doerr of Kleiner Perkins Caufield & Byers of Menlo Park, contributed nearly $6 million to the campaign for Prop. 71. The figure was 25 percent of the total contributed to the campaign, which was run by CIRM Chairman Robert Klein. The Kleiner firm also took part in today's new funding round for iPierian.

During the campaign, opponents said that Prop. 71 was little more than seed money for the venture capital community.

CIRM says no connection exists between the contributions and the CIRM award to iPierian. The company and Kleiner have not responded to requests for comments. We are asking again and will carry their remarks verbatim if we receive them.

Ipierian has said it plans to seek CIRM funding in the upcoming $50 million clinical trial round. It is expected to be one of only three companies applying. Today's announcement said the new financing “will allow the company to drive its programs into the clinic, while securing pharmaceutical partnerships.” In March, when CIRM directors approved the concept for the clinical trial round, they were told it would require substantial matching funds from applicants.

The RFA for the round was originally scheduled for April or May but has not yet been posted. On June 7,  we asked Don Gibbons, CIRM's communications chief, why the RFA was delayed. Gibbons has not replied, but one reason for the delay in posting could be that potential applicants needed more time to arrange for matching funds. The RFA is now targeted for posting this month.

Today's announcement from iPierian also said that John Walker was leaving as CEO, a job he has held since February 2009. He is being replaced by Michael Venuti, who was president and chief scientific officer. Venuti praised Walker for his leadership, including securing grants from CIRM.

CIRM Improving Web Site, Easier to Navigate, Better Organized

The California stem cell agency has made some improvements in its Web site aimed at making it easier to use and more helpful to the public.

One good change deals with the way it presents the information concerning the meetings of the agency, improving the organization and making it more intuitive. The new presentation should be more useful to the public and also save time for CIRM. You can find upcoming meetings, transcripts and agendas, complete with background material on the meetings pages.

Other changes involve the disease and governing board pages. The disease pages help people interested in stem cell research and particular diseases. Amy Adams, CIRM's communications manager,  said they now “include resource links, info about grants we've funded in those disease, and links to videos and outside resources. I think these pages are an excellent resource for the community. We'll be adding to these over time.”

The governing board pages provide a better entry point for finding information on the 29 directors of the $3 billion enterprise.

The CIRM has also tried to make it easier for folks around the globe looking for stem cell information. They are optimizing the site to make it easier for “strangers” to CIRM to find the location through Google, Bing, Yahoo and other search engines.

Adams says more changes are in the works. One that we would like to see is a major improvement in the internal search engine – the one that is used to come up with facts and figures actually on the site.

The CIRM Web site has a huge amount of information on it. More is to come. Good organization and navigation tools make it even more useful to the public and CIRM's special constituencies.

Watered-Down Reform Bill Moving Ahead; CIRM Looking at Boosting Staff to as High as 60

The California stem cell agency almost certainly will be able to hire a small platoon of additional employees next year as state lawmakers appear ready to remove a voter-imposed staffing cap.

That, however, may sound more troubling than the reality. The agency still has a 6 percent limit on operational spending, which makes the cap of 50 employees both redundant and a bit foolish. CIRM has labored for some time with what amounts to a staff the size of a 24/7 Burger King, and CIRM President Alan Trounson has warned that the quality of work could suffer.

The agency, with only 45 employees, is trying to oversee more than $1 billion in awards to more than 300 researchers and institutions. At the same time, it is attempting to award another $2 billion in increasingly complex grant rounds that reach into clinical trials and involvement with corporate biotech.

Earlier this year, CIRM said it might hire as many as 15 additional employees. Beyond that, it would run into space problems in its existing offices. Hiring additional employees would also “shorten the life span” of the cash available under the 6 per cent limit, which refers to the $3 billion in bond funding.

The bill removing the cap is headed for placement on what is known as the consent calendar. Items in that category are supposed to be noncontroversial (but there are exceptions) and are voted on as a block with no discussion.

The legislation, SB 1064 by Sen. Elaine Kontominas Alquist, D-San Jose, is currently in the Assembly Appropriations Committee after winning approval in the Health Committee, 19-0, on June 30. After passage by the full Assembly, it will return to the Senate for concurrence in Assembly amendments before it goes to the governor. It would take effect at the beginning of 2011.

Given CIRM's support, the first time ever for such legislation, the bill seems certain to be approved. However, approval requires a rare, super, super-majority vote – 70 percent – of both houses, so it only takes a few legislatiors to bring the bill to a halt.

The stem cell agency backed the bill in a compromise that significantly watered down the legislation. Gone are many reforms recommended by the Little Hoover Commission, the state's good government agency, along with provisions sought by the state's top fiscal officer, Controller John Chiang.

They include elimination of a performance audit by a special Prop. 71-created, financial oversight committee chaired by Chiang. Instead CIRM itself would pay ($400,000 plus) for the audit and control its scope. CIRM already has written into the bill a stipulation that the audit does not have to include “a review of scientific performance.”

Excluding a scientific review gives cover for the agency if it wants to isolate problems it does not want examined. Exclusion also avoids outside review of many of CIRM's key assumptions. However, a detailed scientific review may well be beyond the capability of most auditing enterprises, although they could presumably hire a panel of experts.

But perhaps more important is the fact that the agency would pay the audit firm for the work. If CIRM pays the piper, it calls the tune. Just ask Enron, World.com and others. Any audit paid for by CIRM can be fairly criticized for not being objective. It will mean $400,000 or more for the successful bidder. CIRM has already demonstrated it wants its contractors to be cheerleaders. That was a key criteria for selection of the firm that is now evaluating the economic impact of the agency.

Also gone are revisions in the role and election of the chairman, along with other reforms. The previous provisions would have eliminated the conflicting roles of the chairman, who now has executive management responsibilities, and the president. Problems with the dual executive arrangement at CIRM have arisen in the past and are likely to come up again. Also eliminated are provisions that would have given the board more control over selection of its own chairman.

CIRM's Self Interest Demands More Openness

Cobbling together a $3 billion research program from scratch is no simple task. No chairs, no phones, no computers, no payroll system but no employees either or, for that matter, an office – that was picture more than five years ago when the California stem cell agency launched its unprecedented enterprise.

Adding to CIRM's teething problems were the state's “sunshine” laws. They require the agency's meetings and its records to be open to the public. On top of that was a newly minted change in the state Constitution, also in 2004, that for the first time in state history guaranteed the public the right to access to the people's business.

Some adamant advocates of sunshine laws seem to believe that compliance with all that openness is an easy matter that has little organizational impact. But even the state Department of Justice, in its guide to open meeting laws, acknowledges that the sunshine requirements place an “unnatural” burden on state endeavors. “Frustrating” and “inefficient” were a couple of other terms applied to the “sunshine” law.

It is much easier to sit down in a quiet, private room – away from the great unwashed – and organize a complex enterprise that, in the case of the stem cell agency, is to this day still trying to work out the kinks.

Nonetheless, a “higher value” exists, according to the Department of Justice. A seat must be reserved at the table for the public.

Which brings us to the “Incident at the Marriott” last month. That's when CIRM barred two academics from a meeting that CIRM said was aimed at gathering information for “critical decisions regarding the direction our funding should take.” Certainly a topic of considerable public interest since CIRM's costs (all cash borrowed by the state) run to $6 billion, including interest.

Since that we wrote that item, the barred academics have sent us a copy of the agenda for the meeting that they were originally seeking to attend. Among the matters to be discussed was the sensitive subject of "reimbursement" of human egg donors.

However, a scientist in attendance at a related workshop that day said we were off base when we deplored CIRM's flouting of state law.

The researcher, who must remain anonymous, said in an email,

"This meeting was about sharing the scientific details of the work of the few researchers who have been able to get SCNT to work in animals. There was a scientific discussion about the feasibility of human SCNT, and about what the scientific community would learn if SCNT were to be successful in humans. The goal was to share information about the science. Since so little is published about this field, the scientists were given a safe environment to frankly discuss their unpublished work and their failures. This was a landmark meeting, and it was all about science. It would have never accomplished its goal of scientific communication if the public had been invited. There will be a public report. If the ethics of egg donation are to be the main topic, then there should be another meeting, because that is an entirely different subject."

We respect that point of view and acknowledge that some scientists could have been reluctant to be forthright. But warnings about the possibility of the withholding of information have been common in the decades that I have been connected with state government issues. The reality is that interested parties usually become quite candid when cash is at stake – especially the potential loss of funding.

The paramount consideration in all this is the public nature of the stem cell research effort. When the supporters of Prop. 71 went to the people asking for the money, they implicitly acknowledged that public concerns come first – not scientific sensibilities. And without the public involvement, there would be no California stem cell agency.

By operating under a cloak of quasi-secrecy, CIRM ill serves its own interests. It lays down a record that will fuel opponents, much to their glee, a few years from now when CIRM has its hand out for more state cash, a move that CIRM Chairman Robert Klein is already discussing.

The law, the state Constitution and agency's self-interest are clear. CIRM should maximize its openness and welcome involvement by the public – not to mention its special constituencies in industry and academia.


(Editor's note: Some readers are interested in directly raising their concerns about the lack of openness at CIRM. They can send an email to mking@cirm.ca.gov and ask that it be distributed to directors. If you wish, you can send a copy to us at djensen@californiastemcellreport.com and we will reprint it. Even if it is on the other side of this matter.)

The Agenda from the Incident at the Marriott

CIRM barred two academics from a meeting last month in what appears to be a violation of the state open meeting laws. Below is the agenda, as provided by the two, for the meeting that they were attempting to attend.

A scientist from New York and one from Australia were on the panel at the meeting, whose topics included the level of reimbursement for human egg donors, a subject that readily moves into cash-for-eggs questions. The agenda provides no clear indication of a need to protect proprietary information, as contended by CIRM.

Tina Stevens of San Francisco State University, one of the two persons barred by CIRM, said of the CIRM meeting agenda,

“Please note that the proposed discussion questions following the agenda items concern, in part, paying women for their eggs for research -- something that California has clearly prohibited. Why does CIRM think it is or should be empowered to consider, make, skirt, or change policies that impact women's health without broad public awareness, input, and debate?”

Here is our original item on the “Incident at the Marriott” and a follow-up item. Here is the agenda from the June meeting.

“Session 6. Procurement of human oocytes:

“What has been the experience to date?

“15 minute talks / 30 minute discussion

“Chair Renee Reijo-Pera, Stanford University

“11:10 am Jeffrey Janus, International Stem Cell Corporation

Procurement of human oocytes in California and Russia: five years experience of International Stem Cell Corporation.

“11:25 am Scott Noggle, NYSCF

“11:40 am Bernie Tuch, Sydney, Australia

“11:55 am Aaron Hsueh, Stanford University

“12:10 pm Discussion

“Questions to consider for presenters and for discussion

“What levels of donor reimbursement are necessary to support research? (Is it feasible for CIRM to support SCNT research without allowing reimbursement)

“Are there reasons for donors to prefer research donation over reproductive use of oocytes?

“What is the experience of research donors with regard to OHSS or other adverse outcomes?

“Are research donation programs being evaluated for donor satisfaction?”

Comment on Lewis' $250,000 Contract

An anonymous comment was filed this morning on the “$250,000 Lewis” item. We are publishing it here instead of the usual posting as a “comment.” The reason being that, as filed, the post contained a personal remark about Alan Trounson, one that could be considered potentially libelous. We encourage all those posting comments to avoid personal remarks about all individuals. Comments about how individuals perform their jobs are acceptable and may be extremely forceful.

Here is the comment as edited. We substituted “wildly” for the originally phrase in the comment.

“Interesting..first the budget fiasco and now the stealth hiring of Lewis with a contract number just below one requiring governing board scrutiny. Methinks Trounson believes he is a law unto himself and that he need not seek approval for any activity or spending. While state workers get minimum wage, Trounson spends (wildly).”

$250,000, Six-Month Contract for CIRM's Lewis

The new interim vice president for research and development at the California stem cell agency holds a $250,000, six-month contract that calls for him to push hard to develop clinical applications that CIRM hopes will demonstrate the success of its $3 billion effort.

The hiring -- as a consultant -- of Alan Lewis (at right), onetime head of ViaCyte, Inc. of San Diego (formerly Novocell) and the Juvenile Diabetes Research Foundation,  brings at least a temporary halt to the search to fill the new VP post that was created after Marie Csete resigned suddenly as chief scientific officer. The CIRM Web site no longer lists the VP position as available.

CIRM President Alan Trounson sought unsuccessfully for a nearly a year to fill the job. This spring he appeared to have run afoul of resistance to his plans for compensation for the post, which would normally top out at $332,000 annually if the position were filled by a regular CIRM employee.

Under the terms of Lewis' contract, he is expected to work about 24 hours a week and meet with CIRM officials at least once a week at the agency's San Francisco headquarters. (CIRM provided an unsigned copy of the contract, which is a public document, at the request of the California Stem Cell Report.)

Lewis is the third top executive of CIRM to be working on a part-time, paid basis. The others are CIRM Chairman Robert Klein, who receives $150,000 for half-time work, and co-Vice Chairman Art Torres, who is paid $225,000 for four days a week. By way of contrast, CIRM President Alan Trounson receives $490,008 annually for fulltime work.

Lewis' agreement runs from June 21 through the end of this year at a rate of $2,500 a day, “with pro-ration (sic) for less than four hours.” The contract is capped at $250,000 not including travel expenses.

On June 23, Trounson told the CIRM governing board that Lewis would be serving as a consultant two or three days a week "to help us with the clinical, preclinical programs." Trounson did not mention that Lewis would carry the title of interim vice president for research and development nor did he mention the size of the contract. If it had been above $250,000, it would have required director approval.   

Lewis is expected to travel widely and possibly internationally. Trips from his home in Solana Beach near San Diego in Southern California to CIRM's headquarters will be paid for by CIRM.

Lewis has had a long business career, which raises questions about possible conflicts of interest. In addition to Novocell, he worked for Signal Pharmaceuticals and Celgene in the San Diego area. He left Novocell in 2008 to work for the diabetes group. The CIRM contract said Lewis affirmed that “there exists no actual or potential conflict between the consultant's family, business or financial interest and the services provided under this agreement.”

ViaCyte is the recipient of more than $26 million in awards from CIRM.

Lewis must file a statement of economic interests that is required of most state officials. We have asked CIRM for a copy of that document.

Here is how the contract describes Lewis' responsibilities:

“• Consult Senior Management on biotechnology, pharmaceutical and investment sectors to enable and enhance the development of clinical applications in CIRM’s scientific portfolio.
“• Consult on the preclinical and clinical development phases of CIRM’s programs and projects involving not-for-profit and for-profit teams, including assembling and working closely with CIRM advisory committees to provide oversight of these programs and make go/no go recommendations to the President for continuation of CIRM support.
“• Work in close collaboration with the Executive Director of Scientific Activities.
“• Integrate basic discoveries where possible into the translational and preclinical pipeline and identifies gaps in CIRM’s scientific program for delivery of cell therapies and related products.
“• Develop and implements strategies to aid clinical applications such as in the critical areas of manufacturing, drug and cell product safety and efficacy.
“• Consult Senior Management regarding interface approaches with national and international regulatory organizations”

The contract differs somewhat from the CIRM news release on Lewis. It said that he would “take direction” from the executive director of scientific affairs – not work in collaboration. This is of significance because their duties overlap and could be a source of friction if not carefully managed.

(Photo from San Diego Union-Tribune)

(Editor's note: An earlier version of this item incorrectly said that Lewis' contract was not mentioned by Trounson at the June CIRM board meeting.)

Alan Lewis Joins CIRM as VP for Research and Development

The California stem cell agency today confirmed that that Alan Lewis, formerly of head of Novocell and the Juvenile Diabetes Research Foundation, will be joining its small band in in San Francisco.

Lewis was named interim vice president for research and development. He will be working two to three days a week and focus on  “identifying strategic opportunities and developing action plans to fulfill the mission of the Institute.”

In the CIRM news release, Patricia Olson, executive director of scientific activities for CIRM, said,

“His many years of experience in developing therapies for patient benefit in both for-profit and non-profit organizations will be valuable to CIRM as we expand our program to include clinical projects.”

The announcement from CIRM said Lewis will take direction from President Alan Trounson and Olson.

Trounson, who has been seeking to fill the VP slot for about a year, was not quoted in the release nor was CIRM Chairman Robert Klein.

CIRM did not immediately disclose Lewis' compensation. The VP position has a salary range that tops at $332,000. The news release did not say whether Lewis would be an employee or an outside contractor. However, a CIRM insider told us he would be a contractor. The agency is heavily reliant on outside contractors because it is limited by law to 50 staffers. Currently it has about 45 employees.

Lewis' old firm, now known as ViaCyte, has $26.3 million in awards from CIRM.

The California Stem Cell Report first reported Lewis' link-up with CIRM on Monday.

Escape Therapeutics: The Latest Business to Win a CIRM Grant

A firm founded by a part-time, but award-winning poet was the only company to receive a grant in last week's round from the $3 billion California stem cell agency.

The firm is Escape Therapeutics of Palo Alto, Ca. The principal investigator on the $1.5 million CIRM grant is Basil Hantash(see photo), founder of the firm and an Illinois native who held a biodesign fellowship in 2006-07 at Stanford.

Only one other company filed an application in the $25 million immunology round, originally budgeted for $30 million. That firm's name was withheld by CIRM, which is their general policy concerning unsuccessful applicants.

CIRM reviewers gave Hantash's application a 72 score. The review summary cited some weakneses in the application, but said it was “worthwhile and achievable.”  In the words of the reviewers, the research was “well designed, logical and an interesting approach to pursue.”

Founded in 2006, Escape does not have a Web site. But, according to a company document provided by Hantash, Escape is an early stage, privately held biotech firm “focused on accelerating the commercial availability of allogeneic stem cell therapies by solving the key translational hurdle preventing their clinical utility – immune mismatch and subsequent donor rejection.”

The information continued,

"Invented by Escape’s founder Dr. Hantash while at Stanford University, the company’s platform technology represents a significant potential breakthrough that can revolutionize the treatment of blood-borne disorders such as leukemia, type I diabetes, and autoimmune diseases. Escape’s innovative technology allows for the creation of the world’s first allogeneic, 'off-the-shelf' therapy capable of being used in any patient irrespective of their HLA profile."

In addition to the last week's grant, searches on the Web showed that Escape has other ties to CIRM. It is one of four internship sites for a CIRM training program run by San Jose State University. Asked for comment, Hantash said,

"Escape focuses the training process on translational stem cell research skills, rather than pure academic basic science research. Our interns were the first to publish out of all the interns in the program, so we feel they gain commercialization experience while retaining the rigor of academics. This is a marriage of a Stanford-like focus on entrepreneurship and an industry eye on developing life-saving products to alleviate patient suffering."

Hantash was a partner from 2007 to 2009 at Proteus Venture Partners, a San Francisco Bay Area investment and advisory firm focusing on regenerative medicine. Proteus was heavily involved in CIRM proceedings concerning the agency's $500 million biotech loan effort. Hantash said his responsibilities included fund-raising and deal sourcing and evaluation.

A number of references on the Internet refer to Hantash as an award-winning poet. We asked him to provide a sample of his work. It can be found here.

(Photo of Hantash from Proteus web site)

"Seduction" -- A Poem by a Stem Cell Scientist

At the request of the California Stem Cell Report, Basil Hantash, CEO of Escape Therapeutics, Inc., of Palo Alto, Ca., sent us this sample of the poetry he writes while not working on stem cell research.

(On Aug. 11, 2010, Hantash emailed us, asking us that the poem in this item be removed from the Web site. He said tended "to agree with the anonymous comment that it may not be an appropriate venue."
As a courtesy to him, we have removed the poem.

(We heartedly disagree with the anonymous comment. A narrow-minded focus hampers all of us -- not only scientist and policy wonks.)

Former Novocell/JDRF Chief Hooking Up With CIRM

Alan Lewis, the fomer head of Novocell (now ViaCyte, Inc.) and the Juvenile Diabetes Research Foundation, will be joining the $3 billion California stem cell agency shortly, the California Stem Cell Report has learned.

It is not clear what his responsibilities will include or whether he will be serving as a consultant or on staff. The agency has been seeking a vice president for research and development for nearly a year.

CIRM President Alan Trounson created the vice president's position after Marie Csete resigned abruptly as CIRM's chief scientific officer about 12 months ago. Trounson said he would not fill the post of chief scientific officer. Instead, Trounson came up with the new VP position and said he would seek someone with industry experience. He seemed to have a candidate ready this spring. The CIRM board convened closed-door meetings to discuss compensation for the post, but the sessions ended with no announcement.

Lewis, however, could be filling another position either on staff or as an outside consultant. Lewis resigned as head of JDRF in May for personal reasons. He said he would be returning to Southern California to be with his family.

He joined JDRF in January 2010. He served as president of Novocell from 2006 until he left for the foundation. CIRM Chairman Robert Klein has also been involved in juvenile diabetes issues and was recognized in 2006 as “public service leader of the year” by JDRF. After Lewis left Novocell, it received a $20 million loan from the agency. ViaCyte/Novocell has received four awards from CIRM for a total of $26.3 million.

We queried CIRM concerning Lewis. The agency was noncommital. Lewis could not be reached for comment.

Top 10 Tips for Snagging Cash from CIRM

For businesses seeking clues about how to win cash from the $3 billion California stem cell agency, a UC Davis researcher is offering 10 free tips.

We took a look today at the advice offered up by Paul Knoepfler on his blog. It all makes good sense to us. But what do know? We have never received a grant from CIRM. Knoepfler has.

Here are a couple of his suggestions.

No. 3 –

“Read the RFA very carefully. Perhaps even read it 5 times. It may seem straightforward, but think about the key words being emphasized by the funding agency.”

No. 6 –

“Hire professional grant writers with experience in industry and academia. This is an investment well-spent.”

We also have a couple of our own.

Attend meetings of the CIRM board of directors, particularly those dealing with grant approval. Nothing else will inform you as well concerning the board's thinking on grants. You will also have to a chance to meet some of the very sharp people who control the purse strings.

Read all of the extraordinary petitions filed by rejected grant applicants. Read at least 50 or more of the summaries of reviewers' comments on applications, splitting the material between top-ranked grants and ones that did not make the grade.

Good luck!
 

Stem Cell Information Resource

A Silicon Valley firm has compiled a fine list of sources dealing with stem cell issues and regenerative medicine, ranging from investment info to links to reports on stem cell research in China and Singapore.

The list of resources was put up by Proteus Venture Partners. Many of the sources are familiar but the list is long and comprehensive. Sad to say, it does not include the California Stem Cell Report.

You can find the information roundup here.

NIH and Exculpation

For those of you not fully informed of the tricky byways of stem cell science, the Boston Globe carried a nuanced editorial today that laid out the significance of an arcane “exculpatory” matter last week

Arcane, that is, to folks who do not fiddle with human embryonic stem cells.

The case involved possible use in federally funded research of embryos donated some years back. The feds said no because they were given under conditions that do not meet today's ethical tests, although the donations met the standards of the day, which actually was only a decade or two ago. The Globe called the NIH action a “major blow.”

You can read all about it here.

Biopolitical Times Says More Openness Needed at CIRM

The Biopolitical Times says the public has a right to attend the meetings of advisory groups to the $3 billion California stem cell agency.

On June 23, the online publication of the Center for Genetics and Society of Berkeley, Ca., commented on our report about how CIRM barred two academics from one of its meetings. We said that the action certainly violated the spirit of a relatively new provision of state Constitution that gave the public a broadly construed right to access to government activities, and likely violated the letter of the law as well.

Jesse Reynolds, project director on biotechnology accountability at the center, agreed. He wrote that “CIRM is a public agency, and the public has a right to attend such influential deliberations.”

One of our readers, Justine Durrell, asked this week how CIRM could begin to address its problems with openness. One of the first things it could do is to be sure that such meetings are open to the public and be sure that interested parties are notified in a timely fashion in advance of the meetings.

Tracking CIRM Grants: "Thin Ice" Lurking?

Directors of the California stem cell agency today approved a $15.7 million operating budget for next fiscal year – 28 percent higher than this year's spending – and requested a report from its staff concerning its critical grants management system.

The report was sought after CIRM Director Michael Friedman, CEO of the City of Hope, said he wanted to “express in the strongest possible terms my discomfort” with the decision by CIRM staff to build a custom grants management system.

He said that “unless you are prepared to spend enormous amounts of money, you are stepping on some very thin ice.”

“Everybody has seen horrible examples of custom-designed system that go bad.”

Friedman asked if any subcommittee of directors had approved the decision to go forward with a custom system. The answer was no, but that the decision had been carefully considered by CIRM staff.

At that point in the meeting, we lost the Internet connection to the CIRM audiocast. By the time it was restored , the budget discussion had concluded with approval of the spending plan. Don Gibbons, chief communicastions officer for CIRM, told us by email that the report had been requested. (We will revisit the budget discussion after the agency posts a transcript of the meeting.)

On Monday, when we reported some of the details of the budget, we noted that spending on information technology is scheduled to jump 53 percent from $817,000 to $1.2 million, an increase of about $433,000. Most of that goes for the grant system.

CIRM is trying to oversee more than $1 billion in grants to more than 300 recipients and, at the same time, hand out many hundreds of millions more in the next year or so. It is building custom programs for entire process, from applications to oversight. Currently, CIRM has a $125,000 RFP out for “systems analysis and software development services” and hopes to have a company on board next month.

The board also discussed the strategic financing report(see here and here), which will be wrapped into an external review of CIRM's strategic plan next fall. There appeared to be no clear consensus at this point whether the agency should make grants as speedily as possible or husband its resources to deal with unexpected opportunities in the fast-moving stem cell field. Related to that was a discussion of the CIRM grant portfolio. No action was needed on either item.

Comments by John M. Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., were discussed briefly after they were read into the record. Simpson said he was “troubled” by what appears to be a lack of a level playing field for grant applicants from business and the dominance of academic institutions, who constitute a plurality on  the board.

CIRM Chairman Robert Klein said he did not think that the biotech industry agreed with Simpson's concerns about whether business grant applications were being treated fairly. Klein noted that BIO, a national biotech industry group, recently recognized him with a national award, indicating that the group valued CIRM's contributions. But Klein said more progress was needed.

Vice Chairman Art Torres indicated that he took Simpson's concerns about the seriously but said the public does not understand just how stringent are the conflict of interest standards at the agency.

Directors also approved the a concept proposal for a $45 million round of grants for basic biology research.

You can find slides from the report by CIRM President Alan Trounson here. He discussed recent stem cell research, a proposal for a CIRM online journal and upcoming CIRM workshops. The slides also include those used for the budget presentation.

Fresh Joy from Cyberspace

We have a new connection to the CIRM audiocast. Directors are taking up the strategic financing report now. CIRM VP John Robson is speaking.

Joys of Cyberspace

We have lost the audiocast connection to the CIRM board meeting so reports may be limited. The broadcast disappeared entirely, resumed with one side of someone's phone conversation and then provided a steady electronic hiss.

'Troubling' Trend: Is CIRM Playing Field Level for Business?

A longtime observer of California stem cell matters today said he is troubled by a trend at CIRM that appears to give short shrift to research at biotech businesses in the Golden State.

John M. Simpson has been watching the California stem cell agency since late 2005, along with participating in its affairs, most notably development of its IP policies.

Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., prepared this statement to be read at today's CIRM board meeting in San Diego. Simpson is on the East Coast on other business and may not be able to reach the Washington, D.C., teleconference location to deliver his remarks personally. Here is the full text.

“I apologize that that I was unable to attend today's ICOC meeting. I
appreciate this statement being read into the record on my behalf.

“When Consumer Watchdog began its Stem Cell Project almost five years ago, I
naïvely expressed concerns that the program would be hijacked by the biotech
industry. That has -- at least so far -- not happened; rather, it has been
dominated by academic research institutions, whose representatives hold the
largest number of seats on the board.

“I believe the trend is troubling enough to ask whether the playing field is
level for all applicants. I believe there are grounds for concern.

“Here are some suggestions to improve the situation:

“-- A task force should be convened to consider why companies have fared so
poorly and what should be done. All sessions must be public.

“-- A workshop should be scheduled with interested companies to discuss ways
to improve their applications. It must be opened to the public.

“-- An effort should be made to recruit scientific reviewers with substantial
experience in research programs conducted by businesses.

“-- CIRM meetings that currently include only grantees should be expanded to
include all legitimately interested parties. Currently you have an annual
conference for all grantees. This must be opened to include all grant and
loan applicants, even if they were unsuccessful. If there is a concern
about expenses, unsuccessful applicants could be charged a modest fee. What
better venue to learn what makes a successful application than a conference
that includes CIRM's awardees? It would also create opportunities for
developing collaborations. Currently CIRM continues to suffer from the image
that it is a closed club. Opening conferences to all applicants -- and even
other interested parties -- would help correct that.

“Thank you for your consideration.

“John M. Simpson”

Mystery Item No. 16 Revealed

Here is a link to Mystery Item No. 16. It involves an overview of CIRM's current grant portfolio and is designed to "facilitate programmatic decision-making." Pat Olson, executive director of scientific activities, is presenting the assessment as we write. Her Power Point presentation appears to have been posted by CIRM yesterday afternoon. We reported incorrectly earlier today that the material was not available this morning.

CIRM Directors Discuss Strategic Financing Plans

Directors of the California stem cell this morning began their meeting with a discussion of strategic financing plans. The scenarios being examined would mean different end dates for funding more research. Under one possibility, no grants would be approved after 2014. Another would see funding end in 2017. Both scenarios do not envision funding beyond the remaining $2 billion that CIRM has.

More Live Coverage Today: CIRM Budget and Financial Projections

The California stem cell agency begins its board meeting at 10:30 a.m. PDT this morning, and we will be filing stories as warranted.

Today's matters include the proposed $15.7 million operational budget for the fiscal year that begins one week from tomorrow. The spending plan is a 28 percent increase over its current expenditures. Also on tap are strategic financial projections and a discussion of whether the agency should spend its remaining $2 billion more quickly or more slowly. CIRM expects to continue its work for at least another nine years, even if it does not receive additional funding after its money runs out.

CIRM President Alan Trounson will review the latest stem cell research and highlight his priorities. He also normally goes over upcoming CIRM workshops that may be of interest. He is likely to give a post-mortem on the international stem cell conference last week in San Francisco. CIRM paid $200,000 to be a co-sponsor. Through its arrangements with the city of San Francisco, it also wangled $100,000 in free space at Moscone Center. CIRM additionally paid for an unspecified number of non-CIRM employees to attend the conference.

(Editor's note: An earlier version of this said that information on agenda item 16 had not been posted by June 23. The presentation was apparently posted on the CIRM Web site the afternoon JUne 22.)

Immunology Grants: CIRM Gives $25 Million to 19 Researchers

Directors of the California stem cell agency today approved $25 million for immunology research, overturning four negative decisions by its grant reviewers.

Directors faced a record nine public petitions to reverse its reviewers. After some grumbling, the directors, who see only a summary of the application and reviewer comments, okayed the four.

Successful petitioners included Jeanne Loring of Scripps, Husein Hadeiba of the Palo Alto Institute for Research Education and Judith Shizuru of Stanford University. A fourth grant that failed to pass muster by reviewers was also approved by the board, but without a petition. That went to Yang Xu of UC San Diego.

Forty-four applications were reviewed by the CIRM Grants Working Group, which approved 15, all of which were ratified  by the full board in addition to the four reviewer-rejected proposals. 

The board almost never overturns a positive decision by reviewers and only occasionally approves an application that has been rejected.

The CIRM directors have not been happy with their appeal/petition process for several years. A review of the procedures is scheduled for later this summer. Some changes are certain to be enacted and will affect the outcome of future applications.

Today one CIRM director again expressed exasperation. He was not clearly identified during the Internet audiocast of the board meeting, but he described himself as a scientist. Noting that the directors had limited information about the applications, he said,

“I don't think we have the ability to add value to the process.”

He also said,

“What do we think we are doing... Are we going to fund bad science?”

He said CIRM is “getting more and more applications on the margin.”

CIRM Chairman Robert Klein said the stem cell agency would only fund good science.

Loring was the lone researcher to appear before the CIRM directors at their meeting in San Diego. She said she was only there to answer questions. Elaine Reed of UCLA addressed the board via a teleconference location at the City of Hope in Duarte. However, she was not successful. Any person is entitled to speak to the board under state law.

Director Jeff Sheehy, who serves on the grants review group, said the round may be the first time that stem cell scientists have teamed with transplant immunologists to focus on issues of rejection of stem cells.

CIRM staff told the board that initially only 10 out of 44 applications qualified for approval, based on reviewer scores. Five more were added for “programmatic” reasons, which appears to mean that they are worth pursuing because they fit CIRM's goals.

Summaries of all the reviews of the grants can be found here. Click on the number of the grant to go to the review. Here is a link to the CIRM press release that identifies all the winners by name along with the number of their grant. Names of the rejected applicants are withheld by CIRM with the exception of those who file public appeals. Names of reviewers on specific grants are also withheld along with their statements of their financial and professional interests.

CIRM Board Moves to Closed Door Session

Directors of the California stem cell agency have moved into an executive session to consider confidential items in applications for $30 million in funding for immunology research. It is unclear when the public session will resume, but our guess in an hour or so.

Correction

We incorrectly reported in three earlier items that 45 applications for immunology items were received by CIRM and 16 approved. Actually, 44 were received and 15 approved.

CIRM Board Begins Consideration of Immunology Grants

The board of the Californiai stem cell agency has begun its open session with consideration of $30 million in grants for immunology research. Nine rejected candidates are seeking reconsideration of their applications.

Following consideration of the grants, Chairman Robert Klein said the board would the report by President Alan Trounson.

CIRM Board in Executive Session

The board of the California stem cell agency this morning promptly went into executive session but may begins its open meeting by about 1:30 p.m. or 2 p.m. PDT.

We plan to resume monitoring the meeting again at that point. If you are attempting to listen to the Internet audiocast, you should be hearing music but no voices. The executive sessions are usually in a different room, and the audiocast will resume when the board members return.

Don Gibbons, chief communications officer for CIRM, provided the time estimate. However, the board could take longer or return earlier.

Scripps' Loring on CIRM Grant Petitions

Jeanne Loring, director of the Center for Regenerative Medicine at the Scripps Research Institute, filed a comment today that shed some additional light on the nine petitions that are seeking to overturn negative decisions on their grant applications.

Loring, who has served on grant review committees with the NIH, said,

“I don't think the intention of any of the petitioners was to subvert the review system. Grant applicants who are used to the NIH system expect to have a chance to revise and resubmit their applications in response to the reviewers' critiques.”

Loring, one of the nine petitioners, was reacting to an anonymous comment that the appeals were “undermining the review process and challenging the authority of the reviewers.”

You can read her full comment at the end of the “CIRM Challenged” item.

Live Coverage of CIRM Board Meeting

Stick with the California Stem Cell Report if you want to track the events in San Diego tomorrow and Wednesday at the meeting of the board of California stem cell agency. Whether it is the nine efforts to overturn negative actions on grant applications or the future path of the agency, we will try to bring it all to you in a timely and straightforward manner. We will be monitoring the session via the Internet from a mooring on an estuary in El Salvador and will be filing stories as warranted.

At some point we even hope to be able to tell you what a “Development Candidate Portfolio Review" is. That's item 16 on the agenda. No further explanation of the subject has been offered to the public with only about 12 hours remaining before the meeting begins.

CIRM Challenged by Nine Scientists on Negative Grant Decisions

A ninth researcher has filed a petition to overturn a negative decision on a grant application scheduled to be considered at a meeting tomorrow of the board of the $3 billion California stem cell agency.

The scientist is Judith Shizuru, the third applicant from Stanford to seek reconsideration of an application in the $30 million immunology round. Forty-four applications were filed. Fifteen were approved by the CIRM Grants Working Group. Nearly one-third of those rejected have now appealed the actions.

Regardless of the decisions by the grant review group, the CIRM board can do as it pleases with applications. However, it has been loath to overturn reviewer decisions. A number of board members are uncomfortable with the entire appeal process, including public appeals by scientists at its meetings. Nonetheless, some researchers have been successful.

In addition to Shizuru, here are the the names of the others who have submitted what CIRM calls “extraordinary petitions:” Olivia Martinez and Joseph Wu, both of Stanford; Defu Zeng and Chih-Pin Liu, both of the City of Hope; Genhong Chen and Elaine Reed, both of UCLA;  Jeanne Loring of Scripps, and Husein Hadeiba of the Palo Alto Institute for Research and Education, Inc.

With the exception of Hadeiba, all the institutions of the scientists have members on the 29-person CIRM board. However, they are barred from taking part in discussion of or voting on the grants in question.

An anonymous comment filed on one of our earlier items on the petitions said the "situation is out of control." The comment also declared that the researchers "are undermining the review process and challenging the authority of the reviewers."

Links to all the petitions letters can be found on the agenda for the CIRM board meeting. The summaries of the reviewers' comments can be found here. Click on the number of the grant to read the summary.

Here are two earlier items we wrote on the petitions: "Yamanaka Invoked" and "Six Scientists."

(Editor's note: An earlier version of this item incorrectly said the applications totalled 45 and that 16 were approved.)

Kleiner Piece Listed in 'Best of Web'

Our article last week on the Kleiner-CIRM connection rated a “Best of the Web” listing on the widely read Gooznews Web site.

The article shared the distinction with stories from the Wall St. Journal and New York Times, among others.

Gooznews is published by Merrill Goozner, a longtime journalist and author of “The $800 Million Pill.”

For those of you who may have missed the Kleiner piece, here is the first paragraph:

"A biotech company heavily backed by venture capitalists who contributed nearly $6 million to the election campaign that created the California stem cell agency was awarded a $1.5 million grant this spring from the very same agency."

The piece was also mentioned on healthycal.org, a solid government policy Web site published  by Dan Weintraub, the former Sacramento political columnist. 

Stem Cell Agency Budget Soars 28 Percent

The California stem cell agency plans to spend $15.7 million next year for its day-to-day operations, up 28 percent from this year's estimated spending of $12.3 million.

The $3.4 million increase is for the fiscal year that begins in 10 days. The hefty hike in spending comes at a time when the rest of state government is mired in a financial crisis that shows no signs of ending. CIRM's funds are provided, however, from state bonds – money borrowed by the state – and cannot be touched by the governor or the legislature under the terms of Prop. 71, which created the agency.

Because CIRM's budget consists of borrowed cash, the ultimate cost of its operations will be substantially higher than the nominal figures provided by the agency. CIRM has access to $3 billion in bonds. With interest, that translates to roughly a $6 billion bill for the state of California. In other words, the agency's operations will really cost nearly $32 million – not $15.7 million. And the $490,008 salary of CIRM President Alan Trounson will actually cost the people of California something a hair shy of $1 million.

But even at $32 million, CIRM's budget can easily be eclipsed by one or two of the beefy rounds of grants that the agency awards for stem cell research.

As we noted last week, the stem cell agency provided a much more detailed look this year at its spending plans, a vast improvement over the information that was offered a year ago. However, CIRM did not calculate percentage increases from this year's actual spending compared to what is proposed for next year. Both the percentage increases reported in this piece, along with the actual dollar increases, are the work of the California Stem Cell Report. They are drawn primarily from numbers on CIRM's “projected expenses” document.

The biggest increase in the budget is for salaries and benefits – a 22 percent ($1.5 million) increase from about $7 million to $8.5 million. The agency, which now has 45 employees, plans to hire five more persons in the coming year. The budget documents do not discuss hiring scenarios if legislation passes that would remove the 50 person cap at CIRM. Increases in state-mandated benefits amount to $400,000. Assuming an average of 47.5 employees for the year, salaries and benefits will consume $178,589 for each staffer.

The second largest item in CIRM's operational budget is for outside contracts. The agency relies heavily on non-state help because of the personnel cap. The figure for the coming year is $2.8 million, up 21 percent from $2.3 million this year.

The cost of meetings for the grant working group, which judges grant applications, will soar 151 percent from $452,000 this year to $1.1 million, a jump of $683,000. The budget documents available online do not explain the increase. But they do report that the figure would cover 12 meetings. The grant group archives show that it held only four meetings during the current fiscal year.

Another big jump will be seen in spending for information technology, particularly for the grant management system, which CIRM has been doggedly wrestling with for several years. Spending in that area will rise 53 percent, from $817,000 to $1.2 million, an increase of about $433,000.

The grant management system is a critical tool for the agency. CIRM is trying to oversee more than $1 billion in grants to more than 300 recipients and, at the same time, hand out many hundreds of millions more in the next year or so. It is building custom programs for entire process, from applications to oversight. Currently, CIRM has a $125,000 RFP out for “systems analysis and software development services” and hopes to have a company on board next month.

CIRM's spending plans (see here for all the budget documents) will be considered today by the directors' Finance Subcommittee in a scheduled one-hour teleconference meeting that has public locations in Cornelius, N.C, San Francisco(2), Los Angeles, San Diego, Stanford, Irvine and La Jolla.

At a San Diego meeting beginning on Tuesday, the full board is expected to approve the budget with no major changes. Teleconference locations for the public are available in Washington, D.C., and the City of Hope in Duarte, Ca.

Out-of-state locations are provided for directors who cannot attend the meetings in person, but the sites are public by law.

The full board meeting can also be heard on the Internet. Instructions for dialing in can be found on the agenda. Addresses of teleconference locations are also on the agenda, but some are so vague that you should call CIRM in advance for additional directions.

More Grant Appeals Filed: Yamanaka Invoked

The California stem cell agency has set another benchmark, although this is one that it may not want to trot out at international stem cell gatherings.

Eight scientists whose applications were rejected for funding by the CIRM grants working group and scientific reviewers are seeking to overturn those decisions at the agency's board meeting in San Diego on Tuesday.

It is the largest number of “extraordinary petitions” ever filed and amounts to more than one out of every four applications that were turned down. The total number of applications received was 44. Fifteen were approved. Some of the researchers are likely to appear at the board meeting and make a personal pitch.

The CIRM board has budgeted $30 million for this round of grants. Regardless of the actions by the grant review group, the board can do whatever it wants with the applications, including rejecting all 44.

The board, however, almost never rejects a positive decision by reviewers and rarely overturns the judgment of the scientific reviewers who evaluate the applications during closed-door sessions.

Yesterday we carried an item on the six scientists who had filed petitions at that point. Today CIRM posted two more petitions. They are from Husein Hadeiba of the Palo Alto Institute for Research and Education, Inc.(see petition here) and Joseph Wu of Stanford(see petition here). Both focused on scientific criticism offered in the review summaries. (All the summaries can be found here. Individual reviews can be found by clicking on the number of the grant.)

In support of his appeal, Wu cited remarks this week in San Francisco by Shinya Yamanaka, winner of the prestigious Kyoto Award, also this week. Referring to criticism of his application as having an “unclear rationale,” Wu wrote,

“We believe the 'unclear rationale' is actually a 'clear rationale' and is being adopted by iPS cell pioneers such as Shinya Yamanaka and his whole team in Japan.”

We also should note that the agency seems to be moving more quickly to post these petitions, a definite improvement over past efforts.

(Editor's note: An earlier version of this item incorrectly said the applications totalled 45 and that 16 were approved.) 

Tracking the Wild CIRM

Looking for more on the history of the California stem cell agency?

Here are two Internet sites – other than our particular collection here on the California Stem Cell Report -- that collect stories on California stem cell events that have occurred since Prop. 71 was passed in 2004

The first is on Sfgate.com and includes a variety of stories and video.

The second is healthvote.org. It carries a great deal of material, including TV ads from the campaign. Its news watch feature is useful but not up to date and not complete. Here is the "check up" segment that includes an article that addresses the question of “what has happened since the election?”