Clinical Trial Challenges: The Matter of Michael Martinez

The complexities of finding candidates for clinical trials as ground-breaking as the hESC effort by Geron were touched upon indirectly in news coverage of the case of jockey Michael Martinez.

This morning the San Francisco Chronicle noted that the state workers' compensation department played a negative role in the matter. Earlier, the Daily Racing Form reported that Highland Hospital in Oakland, Ca., initially refused to release Martinez' records because he could not give consent.

Here is what reporter Larry Stumes wrote this morning:

"The decision by Dr. Richard Fessler of Northwestern University came late Monday after a tumultuous day in which Martinez was to be transferred from Highland Hospital in Oakland to UCSF for a high-resolution MRI exam. The transfer was canceled when the state Division of Workers' Compensation refused to authorize it.

"'The doctors at Highland weren't entirely in favor of the transfer and in an e-mail to Dr. Fessler they indicated that they thought that Michael was doubtful as a candidate for the embryonic stem-cell treatments,' said Golden Gate Fields physician Dr. David Seftel, who is advising Martinez's family on his care. 'The family is devastated, but we're regrouping. I don't give up; Michael doesn't give up.'

"Seftel has contacted Dr. Jorge Paz Rodriguez, the medical director of the Stem Cell Institute of Panama - Martinez's native country - regarding adult stem-cell therapy.

"'The benefits of adult stem-cell treatments have been relatively modest, confined to improvement in sensation, bladder control and bowel control,' Seftel said. 'But because it is so soon after the injury, it is possible Michael could get some of his motor control back. The sooner we get him to Panama, the better.'"

Here is what Chuck Dybdal of the Racing Form wrote.

"After initially refusing to release Martinez’s records so that Northwestern University’s physicians could review them, Highland Hospital agreed late Friday to release them. Highland had cited laws that prohibit the release of the records to anyone but Martinez, who has been rendered incapable of responding to specific requests because of the nature of his injuries."

Embryonic Stem Cell Treatment Ruled Out for California Jockey

California jockey Michael Martinez, whose spine was severely damaged earlier this month, will not be enrolled in Geron's clincal trials for hESC treatment, the only such in the nation.

Reporter Matt Hegarty of the Daily Racing Form wrote this afternoon,

“Specialists at Northwestern University near Chicago have decided that the rider Michael Martinez is not a candidate for a clinical trial using embryonic stem cells to treat spinal-cord injuries, according to the track physician at Golden Gate Fields, where Martinez was severely injured in a fall on Sept. 12.

“Dr. David Seftel, the physician, said that the neurosurgeons conducting the trial had concluded from Martinez’s medical records that the jockey’s spinal cord had been too severely damaged to consider Martinez for the trial. Seftel and Martinez’s family had hoped that the treatments, which have shown some promise in studies on rats, would be able to mend the rider’s severed spinal cord. Martinez is paralyzed from the waist down.

“The family received the news that Martinez would not be admitted to the trial on the same day that Martinez’s fiancé, Charlotte, went into labor and was admitted to Highland General Hospital(in Oakland, Ca.), where Martinez is currently receiving treatment. The baby was expected to be delivered later on Tuesday, Seftel said.

"'It’s a day of extremely mixed emotions,' Seftel said."

The New York Daily News on Sunday carried a lengthy story on the accident, in which an 1,100-pound horse running at 35 miles an hour fell on Martinez. The story by Christian Red discussed Geron's involvement.

He wrote,

“The Menlo Park, Calif.-based biotechnology company Geron, which has been approved to conduct clinical trials of stem cell treatment on humans, after the Food and Drug Administration lifted the hold on the company's Investigational New Drug application July 30, would possibly conduct the treatment.” 

Red continued,

“But Martinez is in a race against time, even if he is eligible to get the treatment. According to Dr. Ed Wirth, the medical director of regenerative medicine at Geron, 'stem cells need to be injected between seven and 14 days after the spinal cord injury because that's the time window in which we've seen the best chance of benefit in the animal studies.'

“Geron plans to have seven facilities around the country opened to carry out these trials, and although the company has not made a public announcement, Seftel said that one of the facilities at Northwestern Universityin Evanston, Ill., is currently set up to receive applications for candidates.”

The Racing Form's story this afternoon said,

“Martinez is expected to be transferred late on Wednesday to Santa Clara Valley Medical Center, which runs a rehabilitation clinic that specializes in spinal-cord injuries. Seftel and Martinez’s cousin, the rider Alex Solis, are also exploring experimental treatments with adult stem cells, though, in studies, those treatments have not shown to be as promising as the embryonic stem-cell treatments, Seftel said.”

More Info on hESC Treatment of Jockey with Severed Spinal Cord

Benoit & Associates

Jockey Michael Martinez (left), with cousin Alex Solis.

More details are emerging on the possible use of experimental hESC treatments within the next two weeks on a California jockey with a severed spinal cord.

According to an article yesterday by Chuck Dybdal in the Daily Racing Form, which appears to have carried the first account of the possible treatment, it involves neurological specialists at Northwestern University, presumably at the Acute Spinal Cord Injury Center at Northwest Memorial Hospital.

(Subsequently, it appears that the first story may have been in the New York Daily News on Sunday.)

The center is a nationally recognized leader in spinal cord injury treatment, one of only 14 model systems in the country for spinal cord injury treatment. The center's Web site says it is involved in using stem cells to repair damaged spinal cord and is aggressive in placing patients in innovative rehabilitation programs.

Richard Fessler, a professor of neurological surgery at Northwestern, is evaluating the jockey's MRIs, which are being taken at UC San Francisco, according to a story on page B6 of the sports section of the San Francisco Chronicle.

Neither the story in the Racing Form or in the Chronicle mentions whether treatment involves Geron, Inc., of Menlo Park, Ca., which is conducting the only hESC clinical trial in the country.

In response to a query, Anna Krassowska, a spokeswoman for Geron, told the California Stem Cell Report,

“As you know, there is no other hESC-based therapy cleared for clinical
trials. However, I can't shed any light on this story.”

We also have queried Northwestern and Fessler concerning the possible treatment of the jockey.

The Racing Form story said,

“(Jockey Michael) Martinez suffered a severed spinal cord in a Sept. 12 racing accident at Golden Gate Fields. He needs the MRI to determine if there is enough white matter – a component of the central nervous system that carries messages to and from the brain – for the stem cells to have a chance to work in the experimental treatments, according to Golden Gate Fields track physician Dr. David Seftel.”

Dybdal also wrote,

“After initially refusing to release Martinez’s records so that Northwestern University’s physicians could review them, Highland Hospital agreed late Friday to release them. Highland had cited laws that prohibit the release of the records to anyone but Martinez, who has been rendered incapable of responding to specific requests because of the nature of his injuries.

“A hearing was to be conducted Monday in an Alameda County court as Martinez’s parents, who have come to the United States from Panama, seek to become their son’s temporary conservators for health-related issues. If they are named conservators, Martinez’s parents could approve the experimental stem-cell treatments for their son.

“Martinez has shown continued progress from his injuries, Seftel said. He is able to eat soft foods and drink. All IVs except one have been removed.

“'He’s looking better and shows continual neurological improvement,' said Seftel.

“Seftel said the improvement in his condition would allow Martinez to be flown to Chicago on a private jet with a doctor and nurse in attendance, but that he would not need a specially equipped Medi-Vac flight.”

Chronicle Reports Possible hESC Treatment of Severed Spinal Cord

The sports section of the San Francisco Chronicle carried an intriguing but brief story this morning dealing with use of embryonic stem cells to “repair” the severed spinal cord of an injured jockey.

The story by Larry Stumes said Michael Martinez is in the UCSF medical center for an MRI exam to determine whether he will be flown to Chicago this week to determine whether he is a candidate for the experimental treatment.

A number of unanswered questions are implicit in the story. We are contacting various parties to find some answers.

CIRM Leads National Effort to Forge 'Pathways' with FDA

California's $3 billion stem cell agency has created a broad-based, 43-member, interstate consortium of researchers and businesses to work with the FDA to develop “well-defined regulatory pathways for stem cell therapies.”

CIRM President Alan Trounson is high on the effort, which will be making another quasi-public appearance in just a few days. Last spring, Trounson told CIRM directors that he is “thrilled” with the initiative, which is spearheaded by CIRM General Counsel Elona Baum.

The next consortium program comes up on Sept. 28 – a “webinar” on preclinical considerations for stem cell therapies. The session, which requires advance registration, will feature Mercedes Serabian, chief of a key pharmacology/toxicology branch in the FDA; Robert Deans, senior vice president of Athersys, Inc., of Cleveland, Ohio, and Melissa Carpenter, a stem cell industry consultant and formerly with Geron of Menlo Park, Ca., StemCells, Inc.,of Palo Alto, Ca., and Novocell(now ViaCyte) of San Diego.

Baum has already conducted one webinar on issues on product characterization, which is now available for viewing on the CIRM Web site along with additional materials. Trounson said Baum “has been fantastic in getting the FDA along.”  Trounson told CIRM directors in April,

“If you were able to take the time to listen to these webinars, they're terrific. The information that's coming from the FDA and from the scientists is very, very helpful. And it's a learning process that's going both ways.”

The 43 members of the consortium include George Daley of Harvard, Irv Weissman of Stanford, Owen Witte of UCLA, Tom Okarma, CEO of Geron; Ed Field, president of Aldagen, Inc., of Durham, NC; John West, president of ViaCyte, Inc., of San Diego; William Caldwell of Advanced Cell Technology of Santa Monica, Ca.; Randy Mills, president of Osiris Therapeutics, Inc.,of Columbia, Md., and executives from Pfizer, Johnson & Johnson, iPierian of South San Francisco, Ca.; Genzyme of Cambridge, Mass., and the WiCell Research Institute of Madison, Wi., among others.

On its CIRM-based Web site, the consortium said that the stem cell field will move “faster when interested parties share best practices and resources.” The consortium said,

“This group provides a forum for members to discuss amongst themselves or with the FDA issues of importance to the industry. The RMC's mission also includes serving as a technical resource during development of guidelines and standards.”

The consortium Internet site contains a wide range of links to FDA, ISSCR and other materials. In addition to the Sept. 28 webinar, the consortium has a link to a Nov. 2 FDA workshop on cell and gene therapy trials.

CIRM Salaries: More Than You Want to Know

Salaries at the California stem cell agency tend to be generous when compared to most other state agencies and have triggered comments from some that they are, in fact, “outrageous.”

However, in 2009 the salary of CIRM President Alan Trounson was only $490,182.97, well below the $2.3 million for the head football coach, Jeff Tedford, at the Berkeley campus of the University of California. Tedford earned the most of any of California's public servants that year. No. 2 was another UC coach. No. 3 was an academic with $1.9 million. He is Timothy H. McCalmont, a professor of clinical pathology and dermatology at UC San Francisco.

Nonetheless, Trounson, Tedford and McCalmont all share one common characteristic. Their salaries are of a magnitude that makes California voters gasp and shudder. They have a visceral, negative reaction to what they regard as excessive wages for government employees – a reaction that is not necessarily perfectly rational.

The governor, who makes $212,179, and state lawmakers, who make $116,208, effectively can do nothing to change CIRM salaries. Prop. 71, which created the stem cell agency, walled it off from mischievous fingers that might want to meddle.

Currently CIRM's executive salaries are below the radar of both public and news media. But CIRM is considering proposing, as soon as two years from now, another multibillion dollar ballot measure to extend the existence of the stem cell research effort. That could raise significantly the attention level of the salaries.

Interestingly, the agency partly justifies its salaries on the basis that the agency could go out of business as soon as 2015 when it may run out of its original $3 billion. However, an additional $4 billion bond measure could prolong its life for another 10 years or more.

We have written from time to time about salary issues at CIRM. The agency itself has a number of pertinent documents. But dredging up all the relevant material can be laborious. To help readers navigate the salary information, we have prepared a reading list of stem cell agency documents, a state salary database and selected articles from the California Stem Cell Report. More items can be found on this web site by searching on the term “salaries.”

We will be preparing more reading lists on California stem cell topics. If you would like to see a reading list on a particular subject, please send a note along to djensen@californiastemcellreport.com. Or you can simply make a request via the “comment” function at the end of this item. Just click on the word “comment.”

The salaries reading list can be found here and here.

CSCR Reading List: Salaries at the California Stem Cell Agency

Here are links to articles and California stem cell agency documents dealing with CIRM salaries, which are high compared to many state agencies and which have come under fire from time to time.

CIRM salary ranges

Searchable Sacramento Bee database on salaries of all state employees, including the University of California and the California state university system

CIRM compensation policy

CIRM compensation philosophy
This document attempts to make the case for the high salaries that exist at CIRM at some levels. Among other things, the agency says,

“CIRM employees must be intelligent, entrepreneurial, motivated, flexible, confident in their own abilities, and committed to stem cell science. To retain this special level of employee, CIRM’s employment policy must reflect and reward the uniqueness of a CIRM employee.”

It also says,

“CIRM’s anticipated life-span is 10-14 years, which rules out the possibility of a long-term career track that is available for many civil service positions in the UC system.”

Here are California Stem Cell Report articles dealing with compensation. Others have been published and can be found by searching on the term “salaries” on this web site.

A Matter for CIRM to Ponder: California's Visceral Reaction to High Salaries for Public Servants, July 25, 2010

Science vs. Salaries: What Do People Talk About? Dec. 14, 2009

Stem Cell PR, Salaries and Mixed Messages, Dec. 10, 2009

New CIRM Figures Show 25 Percent Budget Increase, June 17, 2009

“The largest component of the budget goes for salaries and benefits, which are projected at $7.4 million for 47 employees. That is $1.9 million more than this year's estimated figure of $5.5 million. Personnel costs next year amount to an average of roughly $150,000 in salaries and benefits for each CIRM employee.”

CIRM Executive Salaries Take a Hit, April 9, 2008

"Should the president of the California stem cell agency, with roughly 26 employees, be paid $300,000 more annually than the director of the National Institutes of Health, which has nearly 19,000 staffers?"

Legal Wheels Turn: Ban on hESC Funding Temporarily Removed

The nation's stem cell scientists received a reprieve today, courtesy of a federal appellate court that put a hold on an earlier order to halt federal funding of hESC research.

Gardiner Harris of the New York Times wrote:

"The appeals court ruling could save research mice from being euthanized, cells in petri dishes from starving and scores of scientists from facing a suspension of paychecks, according to arguments the Obama administration made in the case. It could also allow the National Institutes of Health to provide $78 million to 44 scientists whose research the agency had previously agreed to finance."

Rob Stein and Spencer S. Hsu of the Washington Post wrote:

"(T)he appeals court made it clear it was not making a final decision about the case, which means the reprieve could be short-lived and the fate of the funding could continue to be whiplashed by seesawing court rulings."

The next court action is not expected to come until sometime after Sept. 20, the deadline for filing additional arguments in the case.

The legal brouhaha makes clear several facts concerning research funding. If you are a scientist, your research is not secure unless you are paying for it yourself. NIH funding is subject to the vagaries of the courts and Congress. Private funding comes with its own set of strings, which generally are not revealed to the public, but they are there. And despite the assurances of the California stem cell agency, its funding can be threatened under some circumstances, as we saw in 2009. CIRM's resources are clearly subject to the state's ability or desire to borrow money and issue the state bonds that are the agency's only real source of cash.

Time to Let Lawmakers Know What They Need to Do

A UC Davis stem cell researcher has joined in the campaign to change the law that resulted in the court order temporarily halting federal funding for human embryonic stem cell research. He is looking for more than a few good supporters.

Paul Knoepfler has posted on his blog a tool that makes it easy for others to join him and write their Washington representatives seeking immediate repeal of the law. It allows readers in any state to look up their elected officials and let them know what needs to be done.

Knoepfler and Don Reed, a longtime patient advocate in California, should get together. Reed also has a blog in which he seeks to create a stem-cell friendly environment nationally and in California. Reed has not yet posted a similar pitch but may well do so.

Reed has been lobbying elected officials for years. His efforts were key to passage in California of a 1990 measure that funded research linked to Geron's spinal cord clinical trials.

That law, however, is in danger of fading from the books. The law is named after his son, Roman, who was paralyzed some years ago in a football accident. Roman also has lobbied for stem cell support and came up with the slogan of the California stem cell agency – “Turning stem cells into cures.”

On his blog, the elder Reed is appealing for folks to write the governor supporting the legislation, which is now on his desk.

Reed writes,

"This law paid for the first state-funded embryonic stem cell research in America, re-insulating damaged spinal nerves. Laboratory rats so badly paralyzed they could only drag themselves are scampering now; that study goes to human trials with Geron. The same research may help cure spinal muscular atrophy, (SMA, a vicious condition which kills children, often before the age of two), multiple sclerosis (MS), and other disorders.

"'Roman’s Law' has helped train new scientists with fellowship grants, and assisted veterans to develop new approaches, from a variation of the petri dish to pioneering new methods of rehabilitation and repair. In addition to 175 published scientific papers, two patents pending which may advance the biomedical industry, and several major scientific breakthroughs, our research brought new money to California."

CIRM Moves Ahead on $50 Million Clinical Trial Round

The California stem cell agency has posted its much-delayed RFA for its first foray into clinical trials – a $50 million loan/grant round that is predicted to have only three applicants.

Firms mentioned publicly as likely to seek the CIRM funds include Geron of Menlo Park, Ca.; Ipierian of South San Francisco, and Advanced Cell Technology of Santa Monica, Ca. The RFA calls for companies to receive loans of up to $25 million each if their applications are approved. Nonprofits would receive grants. CIRM said it only expects to make one or two awards, although the CIRM board could change that.

The RFA, which went up on the CIRM Web site on Aug. 24, originally was scheduled to be posted in April or May. CIRM, which touts its openness and transparency, has not responded to multiple inquiries over several months about the reasons for the delay.

The RFA calls for a successful applicant to have an approved IND, but not necessarily at the time of the review of the applications. CIRM could have delayed the RFA to give potential applicants to time to have one in the pipeline. The RFA said,

"The award recipient must have an IND that is in effect (i.e. not subject to clinical hold) for the novel cell therapy proposed for CIRM funding before issuance of notice of award.” That notice is provided by staff well after approval of an award by the board and could also possibly be delayed pending a go-ahead on an IND."

CIRM does not expect to fully fund a clinical trial, only take part in the financing. It also cannot, by law, fund activities outside of California.

The clinical trial round is part of CIRM's aggressive push to produce results that will encourage voters to approve another multibillion dollar bond measure to continue financing stem cell research with money that the state borrows.

The clinical trial RFA gives CIRM President Alan Trounson special authority to “permit exceptions to requirements specified in this section V.(eligibility) of the RFA (except for the requirement for a cell therapy derived from human pluripotent stem cells) if the president determines, in his sole discretion, that the applicant has demonstrated that the exception would preserve an important research opportunity or make a critical contribution to one of CIRM’s mission objectives.”

The RFA said the exeception requests must be filed by Sept. 29. Letters of intent are also due Sept. 29 with board approval of awards sometime next summer.

Legislation to Give CIRM More Employees Goes to Governor

Legislation to remove the 50 person cap on the size of the staff of the California stem cell agency won final legislative approval yesterday.

The measure, SB 1064 by Sen. Elaine Kontaminas Alquist, D-San Jose, is now on its way to the governor's desk where it is expected to be signed. The bill would go into effect at the beginning of the year.

The limit on the number of employees was written into law by the ballot initiative, Prop. 71, that created the $3 billion research effort. The cap was redundant since the agency has a legal limit on operational expenses. The restriction ultimately hampered the agency's ability to perform its work.

In addition to removing the staffing cap, the compromise bill would require performance audits, albeit limited, of CIRM beginning next year at the agency's expense, according to the latest state Senate analysis of the measure. It also allows the agency to pay the patient advocates who serve on its board up to $15,000 a year. The CIRM board has already acted to do so.

CIRM backed the bill after it was significantly watered down. 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.”

The staff analysis of the bill that was presented yesterday when it cleared the Senate floor on a 35-0 vote said,

“The author's office states that, while stem cell research is an important and laudable goal, concerns about transparency, accountability and oversight raised by the public, the independent Citizen's Financial Accountability Oversight Committee, the Little Hoover Commission, and the state controller detract from CIRM's ability to provide grants and loans in the most efficient way.

“These concerns divert resources and attention from CIRM's ability to maximize voter's investment in stem cell sciences. In 2009 alone, CIRM spent $1.5 million in external contracts for legal services, lobbying, public relations and communications costs to improve its public image, which is a duplication of existing internal resources. Given that the debt from the bonds is serviced from the (state's) general fund, concern about CIRM's lack of transparency and accountability gains greater significance during these challenging fiscal times. By addressing many of these public concerns, this bill enhances CIRM's ability to make grants and loans, and the removal of such barriers frees up resources that were previously diverted from the grant and loan programs.”

According to the analysis, the CIRM performance audits would cover “programs, functions, operations, management systems, and policies and procedures to assess whether it is achieving economy, efficiency, and effectiveness in the employment of available resources.”

The analysis also said it would be at least 10 years before CIRM is likely to generate revenue for the state through the results of the research it finances. The analysis said,

“Due to the time it takes research to be done and a product to be commercialized, the general fund is unlikely to see significant revenue until about 2020. The amount of revenues is unknown and depends on the number and types of drugs and technologies that are commercialized as well as their commercial success.”

CIRM's Sheehy Says CIRM to Pay Off in Cures and Economic Development

On Sunday, we carried an item dealing with the political environment in California surrounding a possible additional $4 billion bond measure to continue financing the California stem cell agency.

CIRM Director Jeff Sheehy, chairman of the board's Scientific Subcommittee, longtime patient advocate and communications manager at UC San Francisco, sent along the following response. It was received before the federal court ruling on hESC research, which Sheehy could have added as a reason for CIRM support.

“I think, David, you are looking at this as a game of 'zero sum' economics in which you assume every dollar spent on stem cell research is a dollar lost to some other worthy state budget item.

“The reason states issue general obligation bonds is that economists recognize that certain investments (historically in physical infrastructure like roads, bridges, ports, and school and university buildings for instance) create value that returns more than to the cost of the investment back to the state. Not only does building a bridge or road hire and pay companies and workers who then pay state income taxes and sales taxes, but there is a multiplier effect by which their personal spending of their wages, etc., on other items circulates through the economy creating additional spending. Further, the new bridge or road speeds other Californians to work faster and more efficiently saving hours of productive time that would have been spent in traffic, creating additional value. Ambulances or fire trucks get to emergencies faster saving lives or property. Given that some investments produce more money for the state in the long run than the money initially invested, states routinely issue government obligation bonds rather than try to budget this funding out of annual general fund dollars. The revenue from the increased economic activity deriving from the investment more than covers the bond repayments that come out of the general funds.

“The more salient question for CIRM is whether it is actually building a platform for the creation of future wealth or building a 'bridge to nowhere' that does little to increase the productive capacity of California. And the Institute of Medicine report, if it is to have any value, must answer that very question. Are the investments in the dozen new facilities for stem cell research, the training of new scientists and technicians from the undergraduate level through the post-doc level, and stem cell research from the basic, laboratory level on through to the clinic creating a platform by which additional wealth for California will be created far beyond the repayment costs of the bonds?

“And while I need a solid IOM report to definitively answer the question, I do believe that overall (minus a lot of superfluous contracts and overly high salaries and a cavalier attitude towards ensuring value for the taxpayers by many CIRM staffers) the investments in intellectual infrastructure made through Prop. 71 will pay off hugely for California as it leads the world in developing and deploying regenerative medicine.

“If CIRM does nothing else but functionally cure HIV infection as the LA Times article suggests is possible, the savings for the state will be huge in lowered medical costs and in income for the state from profits and the growth of Sangamo, based in Richmond CA. This approach targeting HIV may not work, but I feel strongly that eventually some cure for some disease or condition will come out of this spending.

“I also think companies will form and grow just like Intel, Apple, Google and eBay did from the investments made in research at California universities and institutes. Genentech and Gilead are both biotech giants that emerged from research done at California institutions that are generating substantial dollars in economic activity and creating jobs and tax revenue for the state. iPerian, forming and locating here thanks to CIRM and mentioned by you in an earlier column, might be a wealth generator like those mentioned above or it could be one or more of the many small biotech firms working in regenerative medicine up and down the state.

“So David, while I always greatly appreciate your commentary and your reporting, I think to put CIRM funding in the same barrel as annual general fund financing for schools is off the mark. With a five-year-old in public school in San Francisco, I am as frustrated with Sacramento¹s inability to adequately and consistently provide funding on an ongoing basis to educate our children as anyone could be. But pitting annual school funding against capital investments for our future will not stimulate the types of debate that will lead to answers for the respective, relevant questions.”

California Radio Talk Show on hESC Ruling

Art Torres, co-vice chairman of the California stem cell agency, will be one of the guests on a radio talk show tomorrow at 9 a.m. PDT on station KQED in San Francisco dealing with this week's hESC ruling. You can listen to the program live on the Internet.

The station said,

“National Institutes of Health director Francis Collins said Tuesday that the recent court ruling blocking federally funded research on human embryonic stem cells won't affect grant payments that have already been paid out this year. But the institute will freeze its reviews of new grants of this type. Although California's $3 billion stem cell initiative is not affected, we talk about the ruling and its potential impact on Bay Area biotech. Guests include, Dr. David Stevens, chief executive officer of Christian Medical and Dental Associations; Dr. Helen Blau, professor and director of Baxter Laboratory for Stem Cell Biology at Stanford University; Tom Abate, staff writer covering economics for San Francisco Chronicle; and Art Torres, former chairman of the California Democratic Party and vice chair for the board at California Institute for Regenerative Medicine.”

The Latest from the NIH re the hESC Ruling

UC Davis stem cell research Paul Knoepfler this afternoon reported on the latest from the NIH on the federal court ruling on hESC research.

Writing on his blog, he quoted the text of the statement and then offered a comment.

“Pursuant to a court order issued August 23, 2010, NIH is not accepting submissions of information about human embryonic stem cell lines for NIH review. All review of human embryonic stem cell lines under the NIH Guidelines is suspended. The February 23, 2010, proposal to revise the Guidelines is also suspended.

“My interpretation of this is that basically all the changes to embryonic stem cell policy under the Obama administration and all the federally funded use of ES cell lines approved under the new guidelines during this administration is suspended. No one should bother submitting new lines for approval and those that were under review are not going to be reviewed any more. All of that is frozen.”

Media Coverage: Political and Research Implications of hESC Ruling

Here are some excerpts and links to interesting coverage of yesterday's federal court ruling on stem cell research.

Text of the judge's ruling from the Washington Post.

Wall Street Journal, reporters Laura Meckler, Gautam Naik and Brent Kendall on election year politics and more.

"It also could inject the divisive issue into election-year politics and spark discussion in Congress whether to try to nullify the decision by writing new legislation.... 

"The government is spending about $137 million on human embryonic stem cell research this year and is projected to spend about $126 million next year. It's unclear whether the judge's decision would affect currently funded projects. Stem-cell advocates were calling on the government to appeal the decision and seek to have the preliminary injunction nullified....

"A significant amount of stem-cell research will go forward thanks to private funding and the state of California's ambitious stem-cell initiative, which isn't affected by Judge Lamberth's ruling. The California group (CIRM) spends $250 million annually on stem-cell research, with some 30%-40% of the money directed to embryonic stem-cell research."

Los Angeles Times, reporters Karen Kaplan and Naom Levy, on legal view of ruling.

"UCLA law professor Russell Korobkin, an expert on stem cell legal issues, said the ruling was "a terrible decision."

“By considering all research part of an unbreakable continuum, the decision implies that the Dickey-Wicker Amendment has no limits, which is an unconvincing interpretation, Korobkin said. 'It suggests that by conducting research on an acorn a scientist would also be conducting research on an oak tree, because acorns come from oak trees,' he said.”

New York Times, reporter Gardiner Harris, on feeding stem cells and politics of the decision.

"'I have had to tell everyone in my lab that when they feed their cells tomorrow morning, they better use media that has not been funded by the federal government,' said Dr. George Q. Daley, director of the stem cell transplantation program at Children’s Hospital Boston, referring to food given cells. 'This ruling means an immediate disruption of dozens of labs doing this work since the Obama Administration made its order.'

“In his ruling, Chief Judge Royce C. Lamberth of the U.S. District Court for the District of Columbia wrote that his temporary injunction returns federal policy to the “status quo,” but few officials, scientists or lawyers in the case were sure Monday night what that meant. Dr. Daley was among those who said they believed that it meant that work funded under the new rules had to stop immediately; others said that it meant that the health institutes had to use Bush Administration rules to fund future grants....

“The ruling could prove politically tricky, since it returns to public attention the politically divisive issue of abortion and research politics. President Obama made support for the research a signature part of his campaign, and he over-turned the Bush Administration’s more restrictive policy in the first two months of his administration.

“Polls show that the public generally supports embryonic stem cell research, and Judge Lamberth’s ruling — while a surprising legal setback for one of the administration’s signature scientific policies — could prove politically beneficial for the administration by reminding votes of a popular decision.”

CIRM still open for business -- Ron Leuty, San Francisco Business Times, The Associated Press(AP story appeared in The Sacramento Bee, San Diego Union-Tribune and other papers)

Washington Post story, reporters Rob Stein and Spencer Hsu

"'This is devastating, absolutely devastating,' said Amy Comstock Rick, immediate past president of the Coalition for the Advancement of Medical Research, a group of patient organizations that has been lobbying for more federal funding.

"'We were really looking forward to research finally moving forward with the full backing of the NIH. We were really looking forward to the next chapter when human embryonic stem cells could really be explored for their full potential. This really sets us back,' Rick said. 'Every day we lose is another day lost for patients waiting for cures.'"

CBS News on ruling and “snowflake adoptions”

CIRM Director Prieto Says hESC Research Ruling 'Almost Beyond Belief'

CIRM Director Francisco Prieto, a Sacramento physician, sent in the following comment on our item on today's ruling temporarily halting federal funding of hESC research.

"I think you're opening hits the nail on the head: this decision 'makes clear the importance of alternative funding sources such as the California stem cell agency.' It is almost beyond belief that the court could find that the plaintiffs really met the high standards for a preliminary injunction to call an immediate halt to Federal runding, i.e. that 'there is a substantial likelihood of success on the merits; (2) that the plaintiff would suffer irreparable injury absent an injunction; (3) that an injunction would not substantially injure other interested parties.' I believe none of these are true. Certainly researchers using adult stem cells have had unfettered access to compete for NIH funding since the Bush decision in 2001, and continue to be able to compete for funding. It seems almost obvious that this decision if upheld would injure substantially other interested parties - all the millions of people with chronic disease who hope that this research may lead someday to a cure."

California Stem Cell Agency Deplores Ruling Nixing Fed hESC Research

A federal judge today put a temporary halt to federal funding of research involving human embryonic stem cells in a move that makes clear the importance of alternative funding sources such as the California stem cell agency.

Some had questioned the relevancy of the state's $3 billion research effort after the Obama administration restored cash for hESC grants. Critics said California was no longer needed because the feds were back in the game. But despite the ruling today, the state can proceed with its research because it is not constrained by the federal law cited in the court action.

Today's ruling is not a final decision in the case and is likely to be appealed. But it could mean that NIH funding in this controversial area will be stymied for some time, depending on the legal skills of its attorneys. Meanwhile, California will remain the largest source of hESC funding in the nation, although it has been moving into other areas as well. In fact, some have criticized the agency for not continuing to focus intensely on hESC research, which was the justification for spending $3 billion that was presented to voters in 2004.

In a statement, CIRM said it “deplored” the ruling, declaring that it was “immoral.” CIRM said its research would continue unabated, but noted that today's ruling will have a major negative impact elsewhere.

CIRM President Alan Trounson said,

“The decision is a deplorable brake on all stem cell research. Many discoveries with other cell types, notably the so-called reprogrammed iPS cells, would not happen without ongoing research in human embryonic stem cells. This decision leaves CIRM as the most significant source of funding for human embryonic stem cells in the U.S.”

CIRM Chairman Robert Klein said,

“It would be immoral to unnecessarily delay the critical medical research that is vital for human embryonic stem cell therapies to reach patients suffering from chronic disease and injury. We must remember that the microscopic cells used for this research would otherwise be thrown away by in vitro fertilization clinics, by couples that had finished their family planning.”

CIRM's statement said,

“Under this decision, even research using on the hESC lines approved by President George W. Bush will be halted.

“However, CIRM will continue to fund research on all hESC lines recognized by the Bush administration as well as newer lines approved by the National Institutes of Health during the past eight months. This points to the importance of CIRM’s California model of sustained funding in this field that promises to create thousands of jobs in California as well as improved therapies for patients in Californian and around the world.

“With federal funding uncertain, CIRM will continue providing a stable source of funding for those researchers who have committed their labs to pursuing new therapies based on work with human embryonic stem cells. Through this ongoing funding, CIRM expects to be able to continue to leverage California’s investment through its Collaborative Funding Partners, grant-making agencies in seven countries and Maryland and New York.”

The statement continued,

“CIRM will also continue to fund research with other types of stem cells, particularly progenitor cells that can create many cell types and other pluripotent cells such as induced Pluripotent Stem cells (iPS cells). However, it is important to note that work in all these cells types requires insights gained through work with hESCs to proceed with maximum efficiency. hESC research informs the entire field.”

The $3 Billion Question: Kids, Scientists and CIRM

Two California newspapers today offered quite different views of the world – one bleak and the other filled with hope. They implicitly captured the framework that will determine the fate of the state's $3 billion stem cell research effort.

In the simplest terms, it could boil down to school kids vs. stem cell researchers. Or it could be framed as school kids vs. the health of millions or in some other way that is more favorable to the California stem cell agency. And there could lie the fate of a measure – perhaps as early as 2012 – asking the people of California to pony up another $4 billion or so to pay for hundreds of more stem cell experiments.

But first, CIRM will have to overcome emotions generated by stories like those in The Sacramento Bee today. Reporters Diana Lambert and Melody Gutierrez wrote,

“Last year, public school districts started the year with fewer teachers, bigger classes and reduced resources.

“This year, it's worse.”

Classes with 30 or more students are common, libraries are closing, buses are being eliminated, counselors are vanishing. Music, art and shop are luxuries at some schools. And the kids are going to school fewer days.

In marked contrast came the Los Angeles Times story. Rachel Bernstein wrote about research funded by the California stem cell agency that could offer a “cure” for HIV. The “cure” is many years – if ever – down the road, but the preliminary work has generated a wave of hope for many thousands of persons.

Central to both stories is California's $19 billion budget crisis, which is not going to vanish any time soon. Given the shortage of cash, the question becomes whether the state should use its dwindling resources to finance stem cell research, which will not have a genuine payoff for many years and is also being funded by the federal government. Or should the state educate its children, improve its hard-pressed undergraduate university system, aid the poor and disabled and provide health care that is urgently needed by those who cannot afford it.

These are not questions for the stem cell agency today. It already has voter approval to borrow $3 billion via state bonds at a total cost of $6-$7 billion. But they are questions for the voters in a few years. In the past five years, the agency has already awarded $1.3 billion and is moving rapidly into ever larger rounds of grants. CIRM Chairman Robert Klein is acutely aware that, in political and scientific terms, the need for more cash is just around the corner. He is pushing hard for CIRM grants that will hopefully generate tangible results that will win endorsements and voter approval of another bond measure. Last week, he gained approval for a $600,000 Institute of Medicine study of CIRM that he expects will be key to the success of a bond measure. It is expected to be completed in time for the general election in the fall of 2012, a presidential year.

Currently, the California stem cell agency is all but invisible to state's beleaguered public. Stem cell research is not on their list of concerns, which deal with holding or finding a job, paying the mortgage and such simple matters as getting the kids to class when the school bus is cancelled.

Building support for another bond measure means generating thousands of stories like the one in the Times. The public must perceive CIRM as a positive force that will improve their lives and the lives of their loved ones. A tall task, but winning an election is like winning a war. It requires an intense, sharply focused drive that overruns all who stand in the way.

The California stem cell agency is not likely to emerge victorious if the election is framed as children vs. stem cell researchers.  If CIRM is to prevail, it must build a squeaky clean image – one that generates real hope but is based on meaningful results that are publicly impressive. That politically salubrious perception is not yet cemented in the minds of the California public.

It is unclear whether the Institute of Medicine study will do just that. Unclear as well is whether the study will address the fundamental question of whether the borrowing billions for research is the best way for the state to spend its money. Probably not is our guess. That would mean assessing the state's overall needs and prioritizing them.

At CIRM, however, discussion of the institute's study is couched often in a political context, which raises other issues. During the next two years at the agency, where will the scientific judgment end and the politics begin? It is natural for any organism, including a state agency, to want to perpetuate itself for good and not-so-good reasons. Politics, as well, is always part of the governmental process, which includes CIRM. However, its directors and the staff must tread carefully.

The campaign to win approval of a $4 billion bond measure is already drawing considerable attention within CIRM. The effort will need more soon. A baseline public opinion poll would be standard at this point to measure initial voter perception of CIRM and to identify ways in which the public could be influenced. That and other electioneering moves, however, are not suitable for a state agency.

Klein has said he will step down from the CIRM chairmanship in December. So far, however, he has given no indication that he will let go of California stem cell issues. He could well remain on the board. He has his own, personal stem cell lobbying organization(Americans for Cures), which grew out of the 2004 campaign for Prop. 71 that he directed. CIRM also could create a nonprofit entity that could take up tasks that are not appropriate for a state agency. Perhaps he might find a home in one or both of those organizations.

Whatever path Klein follows, if he chooses to lead the drive for more CIRM funding, he will face a formidable task. Unless something changes dramatically, winning approval of a $4 billion bond measure in two years seems an unlikely event given the current hardscrabble condition of the Golden State.

Correction

The "$243 Million" item on Aug. 19, 2010, incorrectly said that the "application process" for the latest disease team round would begin next year. The RFAs for the planning grants for that round are scheduled for later this year. In order to apply for a full grant later, an applicant must have already received a planning grant.

Massive, $243 Million Disease Round Gets Okay from Stem Cell Agency

Directors of the California stem cell agency today gave the go ahead to a $243 million disease team grant round aimed at generating a “development candidate” for a clinical trial, doubling the size of the original proposal by the CIRM staff.

The huge round would fund up to 30 planning grants and 12 full grants of up to $20 million. It would come on top of the initial disease team round of $250 million last October. The application process for the latest round would begin this November with planning grants, which are required to be eligible for full grants. Full grants are scheduled to be approved in 2012.


The size of today's round was doubled at the suggestion of CIRM Director Jeff Sheehy. He said most of the disease team efforts are risky and expected to fail. He said it was important to get more in the pipeline.

Sheehy first proposed 45 planning grants and 15 full grants. CIRM President Alan Trounson resisted the increase in the number of grants, declaring it would overtax staff and reviewers. After some discussion, Sheehy agreed to 30 planning grants and 12 full grants.

The board also approved a more than $600,000 study of its operations by the prestigous Institute of Medicine that would be expected to completed by the general election of November 2012. Chairman Robert Klein said the study would be key to winning voter approval of more billions in state bonds to fund stem cell research.

Sheehy supported the proposal, declaring it would be taken “very seriously” by editorial boards and other segments of the media as well as the public.

Duane Roth, co-vice chairman of the stem cell board, dissented. He said the study will require considerable work on the part of staff. He also said the board should not have “blind trust” that the findings would be ones desired by the board.

The study will be funded with part of the $3.5 million that CIRM has in private donor funds. The cost could increase beyond the $600,000 range because CIRM directors indicated they wanted some changes in the scope of the study. CIRM is currently involved in an expensive external review of its strategic plan and will be subject to a performance audit($400,000 or so), which it will also pay for, under the terms of legislation expected to be signed into law.

The board also approved paying its patient advocate members up to $15,000 annually. That action came during a session late yesterday, which CIRM had assured us would be solely an executive session.

In other actions, the board approved procedures for selection of a new chair and vice chairman. Klein has said he will step down as chairman in December. However, if the board does not vote on a replacement, he will continue in office.

Francisco Prieto, a Sacramento physician, was named chairman of the directors' Evaluation Subcommittee, and Ted Love, executive vice president of Onyx Pharmaceuticals, Inc., of Richmond, Ca. , was named vice chairman. The panel evaluates the performance of the chairman, vice chairman and president of the agency.

Here is a link to the CIRM press release on the meeting.

CIRM Board Meeting Underway

The board meeting of the California stem cell agency began about 10 a.m. today. Currently speaking is CIRM President Alan Trounson, who is reviewing recent research involving stem cells.

Today's Board Meeting Coverage Cancelled; Tomorrow's Still On

We are cancelling plans to provide coverage of today's CIRM board meeting. Don Gibbons, CIRM's chief communications officer, says the meeting will be in executive session for personnel matters, presumably the formal evaluation of CIRM President Alan Trounson, his first ever.

However, we will have coverage of tomorrow's board meeting, which begins at 9:30 a.m. PDT.

Coverage of Today's Stem Cell Board Meeting

We will be monitoring via the Internet this afternoon's meeting of the board of the California stem cell agency and filing items as warranted. The session is scheduled to begin at 4 p.m. PDT. We will also file items for tomorrow's session as well. It is scheduled to begin at 9:30 a.m. However, the CIRM board meetings usually start late.

On the agenda are instructions for listening to the Internet audiocast. The meeting itself is at Stanford.

(After this item was posted, Don Gibbons, chief communications officer for CIRM, informed us via email that today's meeting will be devoted to a personnel session, presumably the evaluation of CIRM President Alan Trounson. That will be private, and consequently we will have no coverage of the session this afternoon.)

Belated Info on Election of New CIRM Chair, $120 Million Grant Round and Costly CIRM Study

With only one business day remaining before its meeting this week, the California stem cell agency released details of its plan for an expensive study of its activities along with procedures for election of a new chairman.

The late-coming information disclosed that the proposed Institute of Medicine study of CIRM would cost $615,000. Previously, CIRM discussions indicated that the cost would be in $1 million range. The memo called for the study to be completed in August or September 2012, a few months prior to the presidential election. CIRM Chairman Robert Klein has said the study would be key to winning support for a multi-billion dollar bond measure that would be presented to voters at an unspecified date. CIRM relies state bonds -- borrowed money -- to finance its operations and grants.

The agency today also released an important memo on procedures for replacement of Klein, who said he will step down in December when his six-year term expires. Unclear is whether Klein wants to remain on the board as a regular member. The board cannot simply choose one of its members as the new chairman. Under the terms of Prop. 71, it must pick only from candidates nominated by the governor, treasurer, controller and lieutenant governor. In theory, however, it could reject all of them and ask for new candidates, although the memo does not discuss that possibility.

The procedures proposed by James Harrison of Remcho, Johnansen & Purcell of San Leandro, Ca., the board's outside counsel, envisioned nominations coming from those officials prior to the board's December meeting. Harrison said the board could meet behind closed doors to consider the candidates. Presumably that would be classified as a personnel session, since both the chairman and vice chairman are considered employees.

Another important item was posted late, in this case Friday. It is a proposal for a $120 million grant round, the second in the disease team effort.

As we remarked earlier, this information comes far too late for the public to evaluate it and formulate well-thought out comments for tomorrow's meeting.

CIRM Hiring of Former Geron Exec Raises Conflict of Interest Questions

The California stem cell agency has hired a former executive of Geron Corp. to serve as a consultant on a $50 million clinical trial award round in which Geron is expected to be an applicant.

He is Laurence Elias, who worked for Geron from March 2006 until October 2009 as vice president for oncology clinical development.

In April, Nature Medicine identified Geron as one of the likely applicants in CIRM's first ever involvement in financing a clinical trial. On May 24, CIRM hired Elias as a $50,000 consultant at a rate of $300 an hour. His contract runs until Dec. 31.

In response to a query, CIRM defended the hiring and said no conflicts of interest were involved. The agency said,

“Dr. Elias is an independent consultant and an accomplished clinical development professional. He was consulted for his technical and regulatory input to ensure that the clinical elements of the RFA were technically complete and accurate.  The concept for the clinical RFA had already been approved and as such Dr. Elias was not in any position to influence the overall scope or structure, nor will he have any role in evaluating applications.  Dr. Elias’s integrity and professionalism are beyond question.  CIRM staff and Dr. Elias complied with all conflict of interest requirements.”

The RFA for the clinical trial round was originally expected to be posted in April or May. It is now scheduled for Aug. 31. CIRM has not responded to repeated inquiries concerning the reason for the delay.

We asked CIRM for Elias' statement of economic interests, which some of its consultants are required to file. CIRM said one was not required in Elias' case.

Geron, in announcing Elias' hiring in 2006, said,

His responsibilities will include the planning, design and execution of clinical trial strategies and protocols as well as the monitoring of these multi–center clinical trials.”

The other two companies expected to be competing in the clinicial trial round are Advanced Cell Technology and iPierian, which is backed by venture capitalists who funnelled about $6 million into the election campaign to create the California stem cell agency.

Our take: The Elias hiring has all the appearances of a conflict of interest. We would not expect iPierian or Advanced Cell Technology to be pleased by the situation.

Bad Link Fixed

CIRM had a bad link to the transcript of the Feb. 3 meeting of its governing board, which was mentioned in the item, "economic interests statements." The link has now been fixed.

Economic Interest Statements of CIRM Directors Posted Online by California Stem Cell Report

Eight months ago, the only public body charged with overseeing the financial practices of the California stem cell agency unanimously recommended more openness and transparency on the part of the $3 billion enterprise.

Chaired by California's top fiscal officer, Democrat John Chiang, the Citizens Financial Accountability Oversight Committee said that CIRM should post online the statements of economic interests of its directors and top executives, following the practice of both Republican Gov. Arnold Schwarzenegger and Chiang himself.

Chiang said,

“To ensure that taxpayer dollars are spent lawfully, wisely and successfully, the stem cell program must pursue the highest standards of transparency to be fully accountable to the public.”

CIRM has all but ignored the recommendation. Instead, it has moved to prevent the committee from exercising more financial oversight of the state's unprecedented research operation.

In response to the controller's recommendation, the California Stem Cell Report is publishing online the statements of economic interest of the 29 directors of the stem cell agency along with those of some of the agency's top executives.

When Schwarzenegger announced his efforts at improving openness, he said,

“Transparency is fundamental to promoting efficiency and effectiveness in government and strengthening the democratic process by giving citizens enough information to reach their own conclusions about how their tax dollars are being spent.”

Understanding and assessing the performance of the California stem cell agency is even more critical than with most other state enterprises. CIRM holds a unique and unprecedented place in state government. Created by a $30 million ballot initiative campaign, it is isolated from the normal financial oversight functions of the governor and legislature. Its stream of income – all borrowed money(state bonds) – cannot be touched, despite California's grave financial crisis.

At the same time, CIRM is riddled with built-in conflicts of interest. Its 29-member board is
heavily influenced by directors tied to institutions that are the beneficiaries of its largess. More than $900 million of the $1 billion-plus that directors have handed out has gone to enterprises with members on the board.

None of this is going to change any time in the near future. Which makes it all the more important for the public to understand who has what at stake when it comes to giving away billions of dollars.

You can find the statements of economic interest here. Here is a link to a state document that helps to explain the nature of the information. You can find the statements of economic interest for Chiang's stem cell oversight committee on his Web site. Here is a link to the transcript of the committee's meeting last January during which questions were raised about accountability and openness at CIRM. Here is a link to the transcript of a subsequent CIRM board meeting during which CIRM President Alan Trounson described  (on p. 132) the discussion at Chiang committee meeting as a “strange critique” and “irrational attack.”  Here is a link to a piece by Los Angeles Times columnist Michael Hiltzik, who attended the meeting and wrote that the agency "has self-righteously fought every attempt to improve public oversight over its disbursement of what is, after all, the people's money."

(The statements of economic interest involving CIRM directors were provided via email by the agency at the request of the California Stem Cell Report, which the agency is required to do by law. They are also available via conventional mail from the Fair Political Practices Commission in Sacramento and in person at both agencies.)

Dismal Lead-Up to CIRM Board Meeting Next Week

If CIRM wants to keep the public in the dark about what its directors are up to next week, it is doing excellent so far.

With only two business days before the directors meeting, little noteworthy has been provided via the board's agenda to inform the public about how its money is being spent. Of nine significant matters coming before the directors, only two have some explanation. One of those is appointment of new members to the grant review group, an action that is routine. The other makes changes in contract policies.

On the agenda is a plan to pay one-third of its directors up to $15,000 annually. However, an ordinary reader would never know that. All the agenda says is “consideration of amendments to ICOC bylaws.” Of course, the public would have to also know there is a meeting next week. No notice of that has been posted on CIRM's home page.

A plan to spend $1 million for an external study of CIRM operations merits only eight words: “consideration of proposal commissioning IOM report on CIRM.” We wrote 853 words on the subject on Wednesday, and it is worth more. Good arguments exist for performing the study, but the public is not going to hear them from CIRM in time to comment intelligently.

All of which makes CIRM look as if it is trying to hide something. It goes without saying that this is a sad and dismal situation for an organization that is spending $6 billion (including interest) that comes from California taxpayers.

$1 Million Evaluation of Stem Cell Agency Comes Up Next Week

Directors of the California stem cell agency appear ready to commission a $1 million “gold standard” study of its operations with the hope that it will pave the way for voter approval of billions more for stem cell research, perhaps as early as November 2012.

The proposal is scheduled to be voted on at the CIRM board meeting next Wednesday and Thursday meeting at Stanford. However, few details of the latest version of the plan are currently available on the CIRM Web site.

Nonetheless, some information can be gleaned from the transcripts of the directors' Science Subcommittee meetings in May and July, when the proposed study was discussed.

Here is what we have been able to extract. The study would be performed by the prestigous Institute of Medicine(IOM). The cost would be in the $1 million range. CIRM Chairman Robert Klein is proposing that about half of the amount would come from private donors. In July, Klein referred to a 15-month timetable, which might be quite speedy for the Institute of Medicine, which moves slowly, according to the transcripts. If work begins in January, the study could be completed in time for the presidential election in the fall of 2012. Politically speaking, that is the likely to be the best time to seek approval of another multibillion dollar bond measure, given the larger voter turnout in presidential elections. Klein, however, did not mention a specific election timetable.

During the two subcommittee meetings, no CIRM director raised the possibility that the study would identify serious flaws in the agency's $3 billion operation. Klein predicted that the study “would be a solid milestone.”

Jeff Sheehy, chairman of the Science Subcommittee and a communications manager at UC San Francisco, said the IOM would provide a “gold standard objective evaluation.”

Sheehy continued,

“I certainly don't want to go off the board in two years without this report being finished. I don't think I could go to any member of the public, any editorial board, any member of the legislature, the governor, any elected official without some sort of external review of what's gone on with a billion dollars of the taxpayers money, especially in the middle of this horrible recession.”

Sheehy noted that the IOM is less than a household word. In May, he provided this description,

“The Institute of Medicine is an independent nonprofit organization that works outside government to provide unbiased and authoritative advice to decision makers and the public. established in 1870, theIOM is the health arm of the National Academy of Sciences, which was chartered under President Abraham Lincoln. The IOM asks and answers the nation's most pressing questions about health and healthcare. And the aim is to help those in government and the private sector make informed health decisions by providing evidence upon which they can rely.”

During the Science Subcommittee meetings, CIRM directors often referred to the IOM's vaunted independence, which they implicitly did not think would be affected by a $1 million contract. There also was no discussion of limitations that CIRM might impose on the scope of the study before signing a contract. In the case of a current $300,000 contract to assess the economic impact of the agency, CIRM specified that its economic consultants must “execute a vibrant and aggressive strategy” supporting CIRM, a requirement that fundamentally damages the credibility of whatever the their report says.

At subcommittee meeting in July, CIRM Director Philip Pizzo, dean of the Stanford School of Medicine and a member of the Institute of Medicine, said,

“Of any organization that I'm familiar with on a national level, there isn't any other that carries the weight of independence and critical review (of) the IOM and the National Academy of Sciences.”

Klein, who ran the 2004 Prop. 71 campaign that created the organization he now chairs, repeatedly framed the study in the context of a ballot campaign. He said he wanted it “finished in time that the public can analyze it before we go back and put forth the question about whether we're entitled to more bonds.”

Klein did not publicly identify potential donors to help pay for the study. A question could be raised about whether he or others intend to solicit funds from persons who have financial ties to enterprises that would stand to benefit from CIRM funding.

Directors acknowledged that the $1 million price tag appears steep. However, it is a tiny amount when compared to the $6 billion cost (including interest) of the stem cell research effort.

Klein's support for an IOM study seems to be in some contrast to his previous complaints about the amount of scrutiny (audits and otherwise) that CIRM has received from various sources. This spring, the agency also successfully stripped out of pending legislation a requirement that the state controller, who chairs a Prop. 71-created panel to oversee CIRM finances, commission an independent performance audit. Instead, the now CIRM-backed legislation (SB1064) places that audit squarely in the hands of the stem cell agency.

At the July meeting, Klein mentioned a proposal from the IOM. We have asked CIRM for a copy of that document.

Leadership and Small Things

Author and Harvard business professor Rosabeth Moss Kanter weighed in this week on “big traps in small lapses.”

The case in point was the recent resignation of HP CEO Mark Hurd, a man who made more than $66,000 a day, because he fudged a $20,000 expense report.

Kanter asked,

“How can very smart, accomplished people do such stupid things?”

Kanter, whose 18 books have won her recognition as one of the 50 most influential business thinkers in the world, noted that Hurd has a fair amount of company.

“Hurd is not the first, and probably won't be the last, top leader to fall from grace over seemingly trivial and avoidable lapses of judgment.”

Citing several cases ranging from the US military to politics, she said the underlying causes include embarrassment (fear of disclosure), lack of attention and arrogrance.

Her bottom line:

“As is often said, the devil is in the details — and so is the angel. Signs of character are most visible when they are least visible — that is, demonstrated by what people do when they think no one is watching, such as following the rules or taking the moral high ground with no audience observing them. That's why the signals of a leader's judgment lies in the small things.”

Her comments apply to leadership in any organization.

Cedar-Sinai's Melmed Named to CIRM Board

Shlomo Melmed 

The governing board for the $3 billion California stem cell agency has a new member – Shlomo Melmed, who is senior vice president for academic affairs and dean of the medical faculty at Cedars-Sinai Medical Center in Los Angeles.

Gov. Arnold Schwarzenegger named Melmed to replace Ricardo Azziz, who left California to head the Medical College of Georgia. Azziz was also a top executive at Cedars-Sinai.

The Cedars news release last week on the appointment said,

“Melmed, the Helene A. and Philip E. Hixon Chair in Investigative Medicine at Cedars-Sinai, is an internationally recognized endocrinologist and specialist in pituitary disorders. His research, which is primarily focused on the regulation of growth hormones and causes and treatments of pituitary tumors, has impacted endocrine care worldwide, and has consistently been funded by the National Institutes of Health since 1980.

“He has authored more than 300 articles in prestigious peer-reviewed journals, trained more than 60 physicians, scientists and graduate students, and played a major role in leading the growth of research and educational programs at Cedars-Sinai.”

Melmed is also professor and associate dean at the UCLA School of Medicine.

(Cedars-Sinai photo)

Emotionalism and Potential Favoritism Cited as Need for Changes in CIRM Grant Appeals

Passion and favoritism, democracy and gamesmanship – all are part of the ongoing discussion among directors of the $3 billion California stem cell agency as they try to fix what some of them call a “broken” grant appeal process.

Hundreds of researchers will be directly affected by whatever decisions the governing board might make. The agency still has roughly $2 billion to hand out.

Indirectly affected are patient advocates and others who may think that research that could help them -- and others like them -- is receiving short shrift.

CIRM's directors have been bedeviled for more than 2 ½ years by appeals from researchers whose applications have been rejected by grant reviewers. It wasn't an issue up to that point because most rejected researchers did not avail themselves of the opportunity to make a personal pitch to the board – an action that they are entitled to under state law. Either scientists weren't aware they could speak to the board directly, as any member of the public can, or they weren't brazen enough to do so.

The directors' new Science Subcommittee has taken up the extraordinary petition process in two meetings this year. But nothing has been heard at those meetings from researchers. One likely reason is the agency's failure to make public in a timely fashion a draft of what they are considering. In July, a proposal for “re-scoring” rejected applications, under certain circumstances, was not made available to the public until one business day before the subcommittee meeting.


Jeff Sheehy, a communications manager at UC San Francisco, is chairman of the Science Subcommittee. A patient advocate member of the CIRM board and a member of the grants review committee, he is one of those who describe the petition process as broken. None of the 29 CIRM directors has expressed satisfaction with how petitions are handled.

At the July Science Subcommittee meeting, Sheehy noted that “a lot of applicants” see no disadvantage to filing a petition and consume an “an enormous amount” of CIRM staff time. According to the transcript, he said the petitions have degenerated into “gamesmanship.” Sheehy said, however, the ability of any person to appear before the CIRM governing board is a “positive feature of the California public policy process.”

CIRM director Joan Samuelson, also a patient advocate member of the board, said,

“I don't see it as a broken system exactly. There are concerns about it. But maybe it's like democracy. We're not nuts about it, but it's the best we've got.”

CIRM divides its grant appeal process in two ways. One is formally called an appeal. It is handled behind closed doors, but probably shouldn't be, and involves conflicts of interests. The staff makes decisions on those issues, although they could be raised publicly by a researcher if he or she chose to do so. Over the past few years, more scientists came before directors seeking reconsideration on other grounds. As a result, the board created something called an extraordinary petition, which is just another way of appealing a negative decision by reviewers.

This spring, nine researchers filed petitions, nearly one-third of rejected applications that were rejected. Four petitions were successful. The process, however, tested the patience of the board.

Some scientists have appeared before the board backed by a small cadre of patient advocates for diseases and persons suffering from serious afflictions, which has raised concerns about the role of emotions in making funding decisions. The presentations are powerful. It would take a cold, cold individual not to be swayed.

In July, CIRM Director Philip Pizzo, dean of the Stanford School of Medicine, brought up what he described as the “emotional overtone” of the presentations. He said that board members understandably respond “when someone speaks with deep concern and passion, particularly about a member of their own family.”

Sheehy responded,

"To be perfectly honest, Dr. Pizzo, that was one of the driving forces for this policy because a lot of times I find myself compelled by emotion, and I've lost the science.”

Sheehy said the re-scoring plan could evaluate a petition in “an atmosphere where there is no emotion.”

CIRM Director Oswald Steward, director of the Reeve-Irvine Research Center at UC Irvine, said he did not think that a new policy was needed on re-scoring. He said that directors already have the power to send back a grant for re-evaluation, although that has never happened as far as we know. It would seem to require nothing more than a vote of the board. However, no procedures are in place for staff to deal with such an action.

Steward also discussed how petitions can lead to favoritism. In the normal CIRM grant approval process, the names of applicants are not disclosed when their applications come before the board. However, in some cases it is not too difficult to determine their identities. But under the petition process, the researchers are required to publicly identify themselves, even if they do not appear before the board. The board also does not have copies of the actual applications, only a summary of reviewer comments.

Steward said,

“This is a more fundamental thing, and I've been thinking about this in terms of this whole issue of extraordinary petitions. The thing that we most often run into is an investigator who, first of all, identifies themselves, which is really...one of the fundamental problems with this process, because if this is somebody we all know, we say, 'Oh, well, this person deserves some really extra attention.' And if it's not somebody we know, then maybe we pay less attention to it. It really is a fundamental...unleveling of the playing field.

“The problem that we most often run into is that whoever says...the reviewer missed this, or there's a mistake or whatever, and we have in front of us the letter from the investigator, but we're still unable to look at the grant itself or the comments of the review panel. So my specific proposal that now I'm going to make for all of the extraordinary petitions is that if an investigator wants to make an extraordinary petition, they should volunteer themselves to provide the (directors) with a copy of the original proposal and a copy of the review. In other words, let's get all the issues out on the table for our consideration.”

An odd bit of CIRM management muddle also surfaced during the July session. CIRM President Alan Trounson said he was not aware of the staff proposal for re-scoring grants and expressed reservations. Trounson's comments triggered some irritation on the part of Sheehy, who said he had been working for some time with CIRM staff on the matter.

No decisions were made last month on changes in the petition process. Another Science Subcommittee hearing is likely in the next couple of months.

California stem cell scientists do have something significant at stake in all this. Even if they cannot appear directly before the subcommittee, it is in their best interests to weigh in with constructive suggestions. They can be sent Gil Sambrano, the staff member who deals with grant reviews. His email address is gsambrano@cirm.ca.gov.

Stem Cell Directors Putting Off More Recruitment Grant Decisions

Directors of the California stem cell agency will meet for two days at Stanford University Aug. 18 and 19, and they are not scheduled to give away any money.

The board orginally was scheduled this month to approve some new, multimillion dollar recruitment packages for star researchers from out-of-state. The grant review group met in July to consider applications in the $44 million program. However, the matter is not on next week's agenda.

We are querying the agency concerning the absence of the awards. A number of possibilities exist. One is that no applications were of sufficient quality. Another is that the matter was delayed until a researcher is actually signed. That would avoid the awkward situation that occurred with the first recipient of the awards, Robert Wechsler-Reya of Duke. The board approved $6 million for him in April, although he had not yet made a decision to come to California and the Sanford-Burnham institute. He did not actually make a decision until last month.

Don Gibbons, chief communications officer for CIRM, said the award was postponed because "the candidate being brought forward wanted more time to notify their current

home institution."

(Editor's note: The preceding comment from Gibbons was not contained in an earlier version of this item.)

The board is also considering a proposal for another round of disease team grants, commissioning an expensive, Institute of Medicine study of CIRM and approving a policy that could lead to compensation of up $15,000 annually to patient advocate members of the board.

With only five business days remaining before the meeting, CIRM has listed only cryptic descriptions of the matters to be considered next week. It has failed to post on the agenda any material explaining exactly what the directors are planning to act on.

CIRM Directors Pay Proposal Advances; Another Openness Failure on Grants Management System

The California stem cell agency is set to pay 1/3 of its 29-member board of directors as much as $15,000 a year.

The action, however, is contingent on passage of legislation (SB1064) that is now in the “suspense” file in the Assembly Appropriations committee. Legislation in “suspense” is usually on hold pending action on the state budget, which is not likely to be adopted any time soon.

According to a CIRM spokesman, the agency's directors' Governance Subcommittee on Tuesday approved the new pay policy, which is aimed at compensating the 10 patient advocate members of the board for the extra time that they must put in. The policy will go before the entire board later this month.

A large part of the burden placed on patient advocate members of the board stems from the conflicts of interests built into the board by Prop. 71,  drafted by CIRM Chairman Robert Klein and a handful of others. The ballot initiative requires a super-majority (65 percent) for a CIRM governing board quorum, which is based on the number of board members eligible to vote. Since many of the board members have conflicts of interest that prevent them voting on matters before the board, the presence of patient advocates is necessary to take action – much more so than many other members of the board.

According to Don Gibbons, CIRM's chief communications officer, the subcommittee took no action on staff reports on CIRM's ongoing efforts to build a custom system to deal with its $3 billion in grants. Directors asked for a report after expressing concerns the effort could be an expensive failure. Details on their discussions will have to wait for release of the transcript.

However, once again, CIRM failed in its responsibility to the public by not posting the reports publicly in a timely fashion. The failure effectively bars the public from being able to make informed comments and violates CIRM's promise of highest standards of openness and transparency. Two reports were prepared. One did not appear until one business day before the Governance Subcommittee meeting. The other appears to have been posted on CIRM's Web site only minutes before the meeting was scheduled to begin.

We will have more on the grants management system when the transcript is posted.