A Look Behind the WARF Patent Announcement

The folks who challenged the WARF stem cell patents and triggered a fresh wave of negative publicity for one of Wisconsin's more sacrosanct institutions deserve credit for this week's surprising announcement concerning more liberal access to the critical keys for ESC research.

That credit is deserved despite WARF's predictable assertion that the organization really has not changed its position. Additionally, part of the backdrop to its announcement seems to involve the abrupt departure last year of WARF's longtime counsel, Beth Donley.

Previously WARF had taken a hardline position on its ESC cell patents, serving notice that it would defend them aggressively. Donley was in the forefront of that position, which is where an attorney should be when her job is to defend an organization's IP. But the ultimate question for WARF really was whether it wanted to appear to be standing in the way of research that could benefit millions of ailing persons all because WARF was grubbing for dollars. We suspect that was a position that made WARF's directors uncomfortable.

Nonetheless, Andrew Cohn, government relations manager for WARF, in response to questions from the California Stem Cell Report, said:

"Our position has not changed. People completely overreacted to comments made (last spring) by a WARF staff person (Donley) in response to a question. They did not report the second sentence of her response which was WARF has no intention of interfering with the CIRM grant process. The policy announced this week was just a clarification on a policy that was misunderstood many people."

Of course, if WARF wanted to clarify its position it could have made its announcement concerning its patents last spring instead of this week.

Following Donley's statement last year, John M. Simpson, stem cell project director of the Foundation for Taxpayer and Consumers Rights in Santa Monica, Ca.; Jeanne Loring, a stem cell scientist with the Burnham Institute in La Jolla, Ca., and the Public Patent Foundation legally challenged the WARF patents, triggering a spate of articles that did not portray WARF as a benign non-profit.

The Simpson alliance is still not satisfied with WARF's position and plans to continue their efforts.

The Sacramento Bee said that Simpson, Loring and the Patent Foundation deserve credit for WARF's "change." It also noted, in an editorial, the benefits of having a friendly critic (Simpson et.al.):

"The California Institute for Regenerative Medicine -- apparently unwilling to pick a fight with WARF -- hasn't joined the patent challenge. Now, ironically, it may benefit from the activism of Simpson and Loring."

In addition to Simpson's coalition, others do not think WARF went far enough. Writing in The Scientist, Alison McCook said,

"Jonathan Auerbach, president of GlobalStem, Inc., agreed that the patents remain a significant 'roadblock' for research. The changes to the licensing terms don't affect in-house industry research, and if GlobalStem receives, for example, an NIH small business grant of $100,000 for human ES cell research, the company would still have to turn over a sizeable proportion -- perhaps in the range of $75,000 -- to WARF in licensing fees, Auerbach noted. Loosening the restrictions 'is progress, but it's not enough,' he told The Scientist. "

Aaron Lorenzo of Bioworld Today additionally reported:

"Some industry sources told BioWorld Today that the new policy doesn't go far enough - WARF said companies still will need a license when they want to conduct internal research, which potentially is debatable given recent Supreme Court rulings on patent law, or develop a product for the market. But those same critics nonetheless feel that the overall bent of the change in attitude represents a positive step."

As for Donley's role in all this, scuttlebutt is floating around in the stem cell world that one of the reasons for her departure from WARF involved a re-examination of the foundation's position on stem cell patents. One report has it that she gave only three days notice.

Whatever the reasons for its announcement, WARF is doing the right thing, and it should receive credit for moving in the right direction. So should Simpson and company for lighting the way.

Ebert on WARF and the Patent Challenge

Lawrence Ebert, a patent attorney in New Jersey, has a different take on WARF and the stem cell patent matter. Among other things, he faults The Sacramento Bee and challenges the challenge to the patents:

"Patent claims are not invalidated because earlier researchers paved the way for later researchers. PubPat's anticipation argument for human embryonic stem cells is based on a prior reference which is not enabled as to human embryonic stem cells. To look in a different area, the work of Galileo (and others) may have paved the way for the Wright Brothers, but no one achieved three dimensional flight control before the Wright Brothers, or taught how three dimensional flight control could be achieved. PubPat's obviousness argument is based on the assertion: recipe for mouse embryonic stem cells renders obvious recipe for human embryonic stem cells. If this were true, it probably would not have taken 15 years between mouse and human."

Reading the Economic Entrails of ESC Research

Is embryonic stem cell research a cash cow? Or just another public policy chimera?

The questions have surfaced again in news reports concerning two old studies by economists. One is the much-noted 2004 campaign study by Laurence Baker of Stanford and Bruce Deal, managing partner of the Analysis Group of Menlo Park. The other was prepared in the middle of last year by Richard Gilbert of UC Berkeley. Gilbert's study was relatively pessmistic compared to the Baker study.

Writer Malcolm Maclachlan of the Capitol Weekly in Sacramento tackled both of the studies in a recent piece called "Stem Reality Check." Maclachan wrote:

"Gilbert was careful to note that he is not accusing Baker and Deal of any dishonesty in their study. For instance, Gilbert writes in his report that they were clear with their assumptions and the fact that these numbers were estimates of money that could be made many years in the future. If anyone took these numbers as guarantees, he said, they probably did not do so via a careful reading of Baker and Deal's report.

"'As with anything, people believe what they want to believe,' Gilbert said.

"However, Gilbert does bring up two main issues he has with assumptions made in the report. First, he said they take a 'prospective approach' to their estimates--that is, they try to estimate the number of viable new therapies that will be created. Gilbert said that a 'retrospective' approach would be more appropriate, 'based on actual royalty generation by research funded by universities, hospitals and research institutions.' That approach takes note of the fact that big money makers--for instance, the cancer drug Taxol, which made $67 million for Florida State University in 2000 alone--are exceedingly rare.

"Second, Gilbert takes the authors to task for not fully factoring in a concept called 'the time value of money.' Not only does inflation rob money of its value over time, Gilbert said, but money tied up in stem cell research is also money not available to be invested elsewhere. Though Gilbert writes: 'In their defense, the authors report only projected revenue flows, not the value of those revenues.'

"By combining these two concepts, Gilbert estimated that a better real money value of the returns California could see would be reduced to between $31 million to $62 million.

"'I don't think this is terribly surprising to a lot of people,' Gilbert said. 'Basic research is rarely a cash cow.'

"Baker took the critique in stride. He noted that circumstances have changed greatly since he wrote the report, especially in terms of an improving political situation for stem cell research in Washington.

"'It's a complicated area that's evolving all the time,' Baker said. 'I don't know if there's a right way to do the estimates.'"

The Capitol Weekly also wrote:

"So why should people be paying attention to a 7-month-old critique of a 28-month-old report? Because other states are starting to propose big money for stem cell research--and at least one of the same players from Prop. 71 is involved in other states initiatives, said Jesse Reynolds, project director on biotechnology accountability with the Oakland-based Center for Genetics and Society.

"For instance, Deal wrote a report used to promote a stem cell initiative in Missouri which estimated that the state could save up to $3.8 billion in healthcare costs over 20 years from stem cell research. Amendment 2 merely protects stem cell research in the state; it did not put forth any money. It passed in November with a bare 51.2 percent of the vote. Deal did not return a call seeking comment for this story.

"This coming November, New York voters will decide on a $1 billion bond for stem cell research. In neighboring New Jersey, they'll vote on $500 million. Both of these dwarf the previous number 2 state stem cell effort, Reynolds said, the $100 million over 10 years approved by the Connecticut General Assembly in June, 2005."

Here's what really lies at the bottom of ESC petri dish: If there were sure money to be made in ESC research, venture capitalists would be pumping gazillions into it. And there would be no need for efforts like the California stem cell agency.

CIRM on WARF

The California stem cell agency, until now, has been nearly deathly silent on the WARF patent flap.

But the agency released the following statement in the wake of WARF's change of heart.

"The announcement today by the Wisconsin Alumni Research Foundation (WARF) appears to be a major step forward in facilitating the sharing and accessibility of materials that will move stem cell research closer to therapies and cures. We are interested to hear more details and to review the new licensing policies."

The Perils of Microsoft

Courtesy of Windows, the California Stem Cell Report has become Internet-challenged. The XP operating system on our laptop took a dive about 24 hours ago, and we are in the processing of rebuilding. Look for fresh postings sometime on Wednesday.

WARF Softens Stem Cell Patent Position, Critics Not Satisfied

In a surprising move, WARF says it is making changes in its embryonic stem cell patent program that should have a "positive" impact on the California stem cell research effort and others as well.

WARF previously had taken an aggressively combative position in relation to California and challenges to its ESC patents. Its move, however, did not satisfy opponents, who said the changes do not go far enough.

WARF said:

"Industry-sponsored stem cell research will be facilitated by a new WARF policy that will enable companies to sponsor research at an academic or non-profit institution without a license, regardless of location and regardless of intellectual property rights passing from the research institution to the company. This will enable companies to get started with stem cell research in a low-cost, visible manner and increase funding of stem cell research by for-profit companies. Companies will still need a license when they want to bring the research into their company laboratories or when they want to develop a product for the market."

WARF continued:

"Second, while ensuring provisions related to informed consent for embryo donations are communicated and honored, WARF is changing the cell transfer provisions in its academic and commercial licensing. The new policy will allow easier and simpler, cost-free cell transfers among researchers. This will facilitate collaborations within the human embryonic stem cell research community and thus advance the field."

WARF added:

"WARF is also clarifying its position with regards to the California Institute for Regenerative Medicine (CIRM). As a not-for-profit, grant-making organization, CIRM does not require any license or agreement from WARF to pursue its grant making policies. Further, WARF does not expect CIRM to remit to WARF or WiCell any portion of payment that CIRM receives from its grantees. WARF has been and will continue to be supportive of CIRM’s efforts to fund human embryonic stem cell research and move the technology forward."

John M. Simpson, stem cell project director for the Foundation of Taxpayer and Consumers Rights of Santa Monica, Ca., which is challenging WARF´s patents, said:

"WARF’s action demonstrates that their previous stance was indeed detrimental to stem cell research in the United States. While I welcome this step forward, the best thing would be for WARF to abandon its claims to these over-reaching patents that are recognized nowhere else in the world."

Jeanne Loring, a stem cell scientist at the Burnham Institute in La Jolla, Ca., said,

"This change in policy is a step in the right direction and academic scientists will be pleased that they can collaborate with other scientists without interference from WARF. But a change in licensing policy of the human ES cell patents doesn't solve the fundamental problem that the patents should not have been issued in the first place."

CIRM did not have an immediate reaction to the news from WARF but the California Stem Cell Report has queried the agency.

Replacing Zach: A Chance to Weigh in on the Next President

If you want to lobby the California stem cell agency concerning its search for a new president, you can do it this month from locations ranging from Washington, D.C., to Chico in Northern California.

Those are two of the locations listed for remote, telephone access to the meeting of the CIRM presidential subcommittee on Jan. 31. The group plans to discuss criteria for selection of the replacement for Zach Hall, as well as the time table and the likely hiring of a presidential search firm.

The most interesting stuff, however, is likely to be discussed during an executive session following the committee's public musings.

Other remote locations are in Berkeley, La Jolla, San Francisco and Los Angeles. The exact addresses are available on the agenda.

CIRM Surfaces in Lobbying Article

The California stem cell agency popped up in a recent piece in the Harvard Political Review discussing lobbying in Washington, D.C., particularly that of Big Pharma.

The article noted that as of 2004 the pharmaceutical industry employed nearly 1,300 lobbyists in Washington, D.C., about twice the number of elected officials in the House and Senate. Of course, those lobbyists are vastly outnumbered by regulators. The piece also noted that Pharma spent $128 million in 2004 to push for tax breaks. That was about four times the amount spent that year on behalf of Prop. 71, which created the stem cell agency in California.

Stem cell research, the article said, has "arguably caused the greatest controversy." That where the article's authors, Alex Lavoie and Richard Kelley, brought in CIRM.

"Dale Carleson (sic), chief communications officer for the California Institute of Regenerative Medicine, said in an interview with that HPR that “a change in federal policy severely limits stem cell research,” giving scientists a strong incentive to try to influence the policy-making process. Carleson’s California Institute of Regenerative Medicine is the state government agency responsible for managing the three billion dollar investment in stem cell research, a result of Proposition 71, passed by the California Legislature in 2004 after heavy lobbying from interest groups. Government funding is, according to Carleson, “essential, especially to basic and preclinical research. Between the government and private foundations, most of them devoted to a specific disease, that’s the life blood of stem cell research.” Without funding from the government, stem cell research would suffer greatly, and without information and encouragement from lobbyists, the government might never support research in the first place."

The article went on to point out the cost of lobbying is prohibitively expensive for many groups, meaning a tilt towards those who can pay to be heard. At the same time, the piece said, that it is hard for lawmakers to separate the national interest from constituent interest from industry interest, which, we should note, can overlap significantly. "Unbiased advice is hard to come by," the article said.

CIRM has not yet really felt the impact of lobbying. At our last check, no lobbyists had been registered in Sacramento as attempting to influence the agency. A few firms and associations have spoken out on some issues, particularly IP. But that is likely to change as the coffers open wider at the stem cell agency.

(Editor's note: As most of you know, the Harvard item erred when it said the California agency was created by the legislature. It was created by a ballot measure that carried language that virtually immunized the agency from legislative influence.)

The Search for a New Zach Hall

Preliminary work has already begun to find a replacement for Zach Hall as president of the California stem cell agency, one of the key decisions that must be made this year by CIRM's directors.

The presidential search subcommittee is expected to hold its first meeting on the matter Jan. 31 at CIRM headquarters in San Francisco. The full Oversight Committee is likely to address the issue at its two days of meeting in February.

Hall, 69, plans to leave his post in June, if not earlier.

The Sacramento Bee editorialized today on Hall's tenure and the task facing the Oversight Committee, which seemed to have some difficulty finding a president in 2005, when CIRM was less settled.

The Bee wrote:

"The institute's next president will face many of the challenges Hall confronted: implementing strong ethical standards for stem cell research; overcoming funding restrictions imposed by lawsuits filed against the agency; and hiring the best staff. More art than science will be the challenge of responding to an oversized, 29-member oversight board that is rife with internal conflicts and strong personalities, including the board's often-imperious chairman, Robert Klein II.

We've had some occasional differences with Hall, but he clearly deserves credit for many of the agency's recent successes. He's hired some excellent assistants, implemented a thoughtful strategic plan and tried to move the institute from a highly politicized agency to one that focuses on science and seeks to command respectability. At times, Hall could have done more to solicit opinions and respond to the agency's critics, but given his background -- he came from the insular National Institute of Health -- he's gone further than many would have expected."

The editorial continued:

"The talent search should be easier now that the institute has received a $150 million loan from the state and won its first round of court challenges. Even so, fissures will be likely. Some board members will want to hire a star scientist; others will want a seasoned administrator.

"Whatever the outcome of the debate, the board must make certain qualifications priorities. The next president must be a leader of integrity, with experience in running a public agency and a commitment to transparency. At his best, Hall provided this leadership. He gives the board something to build on."

Surfing the Wave of Good Stem Cell Vibrations

The House vote on federal embryonic stem cell research has created a fresh wave of good feeling for the stem cell industry, and at least one California firm is moving quickly to capture its momentum.

Advanced Cell Technology of Alameda issued two news releases this week, specifically citing the current political climate. One announced a national conference call Friday for investors during which ACT executives will promote their company and point of view.

The company also announced that it had received a "momentous" $204,439 NIH research grant in conjunction with a project involving one of the company's academic partners, the Burnham Institute in the San Diego area.

The news release quoted William M. Caldwell, chairman and CEO of ACT, as saying:

"This grant is momentous in part because it reflects the changing political climate and the federal government’s move toward considerably greater support for research into embryonic stem cell science. Increases in federal funding can trigger very significant growth in our industry, and grants such as these help companies like Advanced Cell deliver stem cell-based therapies to the bedside."

The release also quoted Mark Mercola, professor in stem cells and regeneration at Burnham, as saying:

"There are considerable opportunities in the field of regenerative medicine to use embryonic stem cells to develop therapeutic products to treat diseases where healthy cells may be used to replace those lost to injury or disease. This grant will allow us to build on our collaboration with Advanced Cell to use phage display as a tool to discover novel molecules for directing stem cells to form useful cell types and tissues."

It is fair to say that the releases are as much – if not more – about creating a "good story" for investors about ACT than the science. Nothing wrong with that. That's the way business works. The maneuver is not much different than what the governor of California did last summer when he announced his $150 million CIRM bailout in the wake of the president's veto. It certainly behooves the industry to piggyback on the positive vibrations out of Washington, even if the federal government's position on ESC research remains unchanged.

Oral Appellate Arguments Set for February in California Stem Cell Lawsuit

Don't expect a stem cell love feast on Valentine's Day in the Court of Appeals in California.

That is when foes of the California stem cell agency will go toe-to-toe with state attorneys during oral arguments as the opponents seek to put CIRM out of business. The foes lost during a superior court trial last year and are now appealing that verdict.

An appellate decision could come in a matter of a few weeks following the Feb. 14 hearing, but given the nature of the legal beast, it probably will be later. Then there is likely to be an appeal to the State Supreme Court, where the case is almost certain to terminate, probably before the end of the year.

Oral arguments will begin at 9 a.m. in the First Appellate Court at 350 McAllister St. in San Francisco.

The BioBay Stem Cell Outlook: Congress to IP

The president of the leading biotech industry organization in the San Francisco Bay Area has a good-news, bad-news position on stem cell research.

The bad news is that the "potential" is more than a decade distant. The good news is that some companies have technology that may bear fruit sooner than the efforts of the California stem cell agency.

Matt Gardner, head of BioBay, discussed the biotech outlook with David Morrill, business writer for the Oakland Tribune, in a question-and-answer interview.

Here is what Gardner had to say on stem cell research:

"Q: One of the industry's hotbeds is stem cell research. Given the ethical and political hurdles, will the potential of this area ever be realized?

"A: Yes, but I think we are still a decade or more away from seeing what that potential looks like. Here again, I think California is in such a leadership position, being able to hopefully realize the promise of the stem cell institute (the California Institute for Regenerative Medicine) and that a tremendous amount of work needs to be done at the basic end of the research. And yet, even with that said, there are companies operating today in stem cell sciences that have technologies that may come to fruition much sooner. There are some early signs from a small number of companies that there is strong potential here. So we can only expect to see that grow as the science around stem cells is understood."

Gardner on intellectual property, a major issue facing the California stem cell agency:

"That's a huge issue for this industry. And the biggest thing to focus on there is that the U.S. Congress is going to visit this issue in 2007. What needs to be kept in mind here is that this industry is built on certainty in intellectual property. Anything that any of our public sector partners do to try and draw that into question will be harmful to this industry, no matter what it looks like.

"Most of these companies, when they are initially funded, are done so on a very clear picture of their intellectual property. Because it may be 15 years before you have product revenue based on the amount of time it takes to develop a product, run clinical trials and get the product approved, everything until then is a value based on intangible assets. Until you have your first product approved in this business, you are valued in the potential of the things you are developing. And the potential value of those intangible assets is all wrapped up in whether you own your intellectual property and how clearly you own it."

Gardner on Congress:

"In the next couple of years I think some issues will be brought up to a new level of discussion. One of the great opportunities is that Nancy Pelosi has a tremendous familiarity with the industry. And so in a new way, the industry has a profile with this speaker that it did not have before. To deal with someone in a leadership position that is committed to these solutions is a huge opportunity for us."

Economic Disclosure from the California Stem Cell Report

Here is the annual economic disclosure statement from the California Stem Cell Report. We are filing it because of normal questions that might arise concerning our economic interest in stem cell research.

We, meaning my wife and I, have no investments in biotech firms or any other organizations that could benefit from stem cell research, except through mutual funds, which, of course, we have no control over. We do not hold any mutual funds that are industry specific to biotech.

Beyond that, we are not employed nor do we receive funds from any organization involved in biotech or stem cell activities. Nor is any member of our immediate family (meaning wife and adult children) involved in such a fashion. As far as we know, no distant relatives are involved in biotech or have investments in that area.

We also have no financial connections with organizations that support or oppose CIRM.

All of the above is unchanged from last year.

One would hope that reporters, observers or others trying to influence CIRM (which is not the same as reporters) would be willing to make the same sort of economic disclosure as above. By that we mean specific dollar amounts, from $1 (one dollar) and up – not those wimpy disclosures required under state law or by CIRM.

Beyond the economics, the California Stem Cell Report supports embryonic stem cell research. We believe that CIRM is pursuing a worthwhile endeavor. We also believe that openness, transparency and disclosure are fundamental to good government. That means providing background agenda material well ahead of meeting dates, among other things. Otherwise, meetings can amount to nothing more than sneak-through business, plenty of which can be seen in Congress and the California Legislature.

We also believe in maximum disclosure -- when it doubt lay it out. Specifically all persons with signficant responsibility within CIRM, including members of CIRM working groups, should publicly disclose their economic interests in more detail than required by state law. Outside contractors should disclose their interests as well.

If you have questions or comments on this, you can post them by clicking the word "comment" below or by sending them directly to djensen@californiastemcellreport.blogspot.com. It is possible to comment anonymously by using the "comments" function.

Two Years Before the Stem Cell Mast

Two years ago this month, the California Stem Cell Report began its journey into the multibillion dollar world of embryonic stem cell research.

Since then, we have published more than 900 items on California's extraordinary and unique effort to pump up one of science's more controversial areas of research. Readers have paged through the website tens of thousands of times. They came from throughout the nation and the world, seeking more information about what the small band at CIRM is doing on King Street in San Francisco. (Editor's note: More recent and additional information can be found in an Sept. 17, 2007, article on Wired.com)

The reception has been generally favorable. "The ultimate source for all things California" is how Jim Fossett, director of health and Medicaid studies at the Rockefeller Institute, described the Report on the blog of the American Journal of Bioethics. "Comprehensive," "first thing I read in the morning," "enormously valuable" are some of the comments from other readers, whose numbers include law firms, newspapers and biotech companies. Studies of the California stem cell agency have cited the California Stem Cell Report (CSCR) as a source. University instructors use it as part of their curriculum.

Yahoo nows ranks the site No. 1 and Google No. 4 when using the search term "california stem cell." The rankings are up from near invisibility on the search engines when we began this endeavor in January 2005, less than a month after the first meeting of CIRM's Oversight Committee.

We started this website largely because we were interested in the subject and wanted to learn more. Given our professional background as a newspaper editor (now retired), former state Capitol reporter and gubernatorial press aide, we figured we might as well write about the subject and share the information with others.

It is not often that one can explore an area that stands on the cutting edge of science and medicine, that combines big business, academia, politics and government in a way never seen before in California, perhaps in the country. Not to mention the heated and sensitive religious, ethical and moral issues surrounding embryonic stem cell research, along with the hopes for cures for millions afflicted with diseases ranging from diabetes to cancer. CIRM is an agency – created directly by the people of the state, not the legislature or governor – that plans to give away $3 billion in public funds, basically unsupervised by the normal processes of state oversight. And its directors – voters decided – come from some of the universities and institutions that would benefit directly from its research and building grants.

We surmised that others would also be interested in CIRM but simply would not be able to find all they wanted to know, given the media's practice of covering only the most high profile news. That has proven to be the case. CIRM is virtually invisible to the public and much of the scientific and business community, if they rely on the mainstream media. It is even something of a low profile matter for the scientific media, and even lower in the business press.

Nonetheless the California Institute for Regenerative Medicine has become a benchmark worldwide and nationally for a number of issues including treatment of egg donors and intellectual property rights. CIRM has pioneered new and higher standards in both areas.

We have attended numerous CIRM meetings and visited CIRM headquarters several times. On one occasion, we covered the CIRM lawsuit trial live, filing items directly from our laptop in the courtroom in Hayward. Our reporting largely relies, however, on the Internet, sifting through government documents, news stories and email from a variety of contacts.

Since we travel regularly, gaining access to the Internet is always a challenge. We have used wireless connections in public libraries in San Mateo, San Diego and Santa Barbara and while at anchor on a sailboat in bays in Mexico. At other times, we filed via satellite uplinks, Internet cafes and hotel Web services and used a datacard for Mexican cellular service.

All of that would have been impossible 10 years ago, prior to today's advances in computer and Internet technology.

We hope the California Stem Cell Report has provided information that cannot be found elsewhere as well as serving as a guide and source of analysis and commentary on the Golden State's ambitious effort. We also hope that it has become something of a repository for the full text of California stem cell information that does not have a good home elsewhere, whether it is the statements of California stem cell chairman Robert Klein, acting in a non-governmental role, or documents from critics of the agency.

We are planning improvements and changes in the Report for 2007 and welcome suggestions from our readers. We are particularly interested in bringing in more voices from the stem cell community. Please let us know what you think. What do you want to see more of? What do you want to see less of? Do you have questions that need answers? You can send them and your suggestions to djensen@californiastemcellreport. Or you can post them directly on the blog by clicking on the word "comment" below. If you wish, Google, the hosting service for the blog, provides for anonymous "comment" postings, whose authorship is totally encrypted.

Stem Cells and 'Things that Go Bump in the Night'

What's going on with those CIRM scholars, those folks whose education is being assisted by the California stem cell agency?

Reporter Bradley J. Fikes of the North County Times in San Diego County wrote about 32 of them, including some from fields such as bioengineering, bioinformatics and chemistry. Among other things, Fikes said that ethical training occupies one-third of the curriculum in this particular program.

Fikes quoted Larry Goldstein, director of UC San Diego's stem cell program, as telling the scholars that they have an obligation to become missionaries – not Goldstein's word – for ESC research. Goldstein said:

"Some of you have been studying fish and flies and things that go bump in the night. It's not always obvious to the public how this relates to humans. For better or worse, the world is watching us, not just in San Diego, but in California."

Stem Cell Humbuggery and Its Implications for California

Citizens of California and the American public overwhelmingly support embryonic stem cell research? Balderdash!

California stem cell Chairman Robert Klein and a host of others cite public opinion polls to support their mission, denouncing critics as opposing the will of the people. That position, however, is a bit of humbuggery – dangerous if uncritically believed by supporters of ESC research.

We have argued that support for embryonic stem cell research is quite soft and that the science is poorly understood by the public. Now comes additional evidence for that contention, including an analysis from a devout supporter.

We will discuss the major implications for CIRM a bit later, but first let's consider the thorough-going discussion of the polling data by Matthew Nisbet, a scholar at American University who has studied the subject for some time. In a piece on the website of the Committee for Skeptical Inquiry, he wrote:

"...(O)verwhelming public support is by no means a 'slam dunk' conclusion. In fact the best available polling data shows that while support for research has increased since 2001, support among American adults lingers at only slight majority levels. "

Nisbet continued:

"We are now going on year six of the stem cell debate, and despite major news attention to the issue, and tens of millions of dollars spent on advertising and communication campaigns across the country, the public still scores relatively low in both knowledge of the science and the politics involved."

Nisbet discussed how the wording of the polling questions shapes their results. He also examined how supporters and opponents frame the stem cell issue. While Nisbet did not discuss in detail the 2004 election that created the California stem cell agency, it was a masterpiece of framing. Prop. 71 became a matter of aiding the sick, including members of each voter's family, and boosting the California economy – short-circuiting the feeble efforts of opponents, who largely relied on faith-based moral arguments.
But Nisbet added:

"In recent years, opponents have also evolved in their message strategy, realizing that they can potentially impact the ambivalent citizen on the issue by pairing the moral interpretation with a 'public accountability' frame that defines funding as only benefiting 'special interest' biotechnology companies. The emphasis on the 'commodification of life' by 'corporate science' may resonate with segments of the public that might otherwise reject religiously-based appeals."

Rachael Laser of The Third Way, a "progressive" pro-stem cell think tank, wrote about the public "ambivalence" on ESC research on the group's blog, in addition to preparing a 9-page paper on the subject (which cited this blog as one of its sources).

She wrote:

"The real story is that the majority of Americans are concerned that our fast-paced scientific progress brings with it significant moral hazards. If you are a Third Way groupie (and really, who isn’t?), you will not be surprised that we call the folks in the middle of this debate the 'stem cell grays.'

"By contrast, the 'stem cell polars' are on the extremes: some think that stem cell research raises absolutely no moral concerns; others beleive that it is so morally offensive that they would not support it even in if they knew it could cure a family member of a dreaded disease.

"But to the stem cell grays, America is sort of like the crazy scientist in the lab – he might well be a genius, but he also might blow his lab sky-hight. This concern is also borne out in a series of Virginia Commonwealth University polls that reveal that 56% of Americans believe that science does not pay enough attention to moral values, and 51% also believe that “scientific research has created as many problems for society as solutions.”

"Until stem cell advocates address these types of concerns head-on, they will continue to battle risky margins or Pyrrhic victories."

Nesbit reinforced Laser's point:

"Given the multitude of competing issues in the world, and given limited time, motivation, and ability, it is in fact quite reasonable for the public to rely on heuristics such as partisanship or religious belief to make up their minds about a complicated issue such as stem cell research. This fact might not fit with democratic ideals or with the preferences of scientists, but it is human nature.

"Political strategists understand this, and it’s why they carefully frame their messages around simplistic interpretations of either 'stem cell research leads to cures,' or 'stem cell research is morally wrong,' pairing these messages with celebrity or religious spokespeople. However, for science advocates who care about winning the short term political battle to overturn Bush’s misguided stem cell policy, there is a delicate balance to be struck. As I have argued elsewhere, narrowly focusing on educating the public about the science or the 'facts' involved in the debate will not move public opinion nor be persuasive.

"In the stem cell debate, science advocates need to make sure that they are honest about the uncertainties in research, while simultaneously communicating the hope for important therapies and treatments. As I have argued in this column, accuracy in communication also means being honest about where public opinion stands.

"The opposition is watching, and when inevitable scandals in science erupt such as the Korean cloning affair, stem cell opponents are going to shower communication channels with claims that scientists are willing to go to any extreme to promote their self-interests, and that embryonic stem cell research is 'junk science.' In our sound bite culture, and especially when research opponents don’t play by the same rules, effectively engaging the public on stem cell research is a major challenge. Yet wisdom and precision is needed. At risk is public trust."

What does all this mean for CIRM? The agency faces a greater burden in maintaining public trust than most other state agencies because of its built-in conflicts of interests and its extraordinary independence from normal state oversight. Consequently its procedures must be perceived to be transparent and blemish-free. Perception is the hallmark here. Otherwise the institute can be easily besmirched as a giveaway program for biotech. A substantial public education effort concerning ESC research is needed to generate deeper and more sophisticated support for the science and medicine. Outreach, outreach and more outreach are the watchwords. That includes a much improved website and establishment of CIRM as the key resource for national and state media to consult on ESC matters. And a regular, strong effort in the state Capitol is necessary to maintain a friendly or at least a neutral environment.

Stem Cell Stocks: Buying a Will-o'-The-Wisp?

To slightly paraphrase one analyst, anybody buying stem cell stocks solely based on the House vote on ESC research should be prepared for a long, hard ride.

In the wake of the Congressional action, Aaron Smith of CNN prepared a more nuanced report on stem cell stocks than we saw in news reports last week.

Smith wrote:

"In anticipation of today's vote, investor interest in biotech stocks has been whipped up, though biotechs probably wouldn't benefit directly from the funding, even if it's eventually approved.

"'This is a step in the right direction, but if anyone is buying StemCells Inc. based on this one vote, they need to rethink their priorities,' said Steve Brozak, analyst at the investment and research firm WBB, referring to one of the biotechs involved in stem cell research."

The CNN report continued:

"Although StemCells Inc. (down $0.08 to $3.35) stock fell about 2 percent Thursday, the stock's climbed more than 25 percent so far this year. It's the most recognizable name in the industry, analysts say, even though it doesn't stand to benefit directly from the vote.

"'The stock [StemCells] is probably most tied to political movement, just because of the ticker," said Jose Haresco, analyst for Merriman Curhan Ford & Co., an investment research firm, referring to the company's stock symbol of STEM. "It's almost a perfect barometer."

"The stock of Aastrom Biosciences (down $0.08 to $1.46) slumped about 5 percent Thursday, but overall gained about 20 percent this year. Haresco said that StemCells and Aastrom specialize in the use of adult stem cells however, not the ones derived from human embryos, which are the subject of the bill.

"The stock price for Osiris Therapeutics (down $1.37 to $26.77, another biotech specializing in adult stem cells, also gained this year, though it slumped about 5 percent in Thursday trading.

Geron Corp., (up $0.20 to $8.90) a biotech developing stem cell technology which is based on human embryos, has been volatile this year and only pulled into the plus column Thursday, when the stock rallied about 2 percent. The stocks, save for Geron, had run up after news of the possible House vote first surfaced last week.

"'Geron is clearly at the top of the pack," said Brozak of WBB, who rates the company a "strong buy," noting that it is the most advanced in the development of embryonic stem cell technology.

"Geron's most recent stem cell study involved rats, not people, though a spokesman for the company said early-stage human trials will begin in 2007."

Fuel Your Stem Cell Edifice Complex

Looking for some bucks to renovate your aging stem cell lab?

The California stem cell agency is seeking a few good institutions to share $48.5 million that could start filling their coffers by this summer.

Those of you outside of California are out of luck unless you can concoct a California presence very quickly. CIRM announced today that it wants letters of intent for shared facilities grants by Feb. 2.

The agency's press release said:

"The grants will provide funds for the design and renovation of laboratory space, equipment for the new research facilities, and operating expenses for three years. Some grants will include additional funds to train scientists and technical staff in the growth and maintenance of hESCs."

CIRM continued:

"'The ICOC funded grants to train 169 stem cell scientists last year and will award more than $100 million in research grants this February and March,' said Richard Keller, the Institute’s Senior Officer for Scientific and Medical Research Facilities. 'Shared Research Laboratory Grants will ensure that scientists have the physical facilities they need to cultivate new lines of embryonic stem cells, without running afoul of federal restrictions and without endangering federal funding for other research activities.'

"CIRM expects applicant institutions to provide at least a 20 percent match of the total cost for renovation and equipment. They may request up to $2 million for laboratory space development and an additional $500,000 if they plan to offer a stem cell techniques training course. The RFA is open to all academic and non-profit research institutions in California.

"The Request for Applications (RFA) for shared facilities grants is available at http://www.cirm.ca.gov/rfa/pdf/RFASharedResearchLaboratoriesfinal.pdf. Potential applicants must submit letters of intent to CIRM by February 2, 2007. Full applications will be submitted in two parts. The first part will describe the scientific mission of the proposed facility and is due February 23rd; the second part will detail renovation and/or development of the laboratory space (including fixed equipment costs), and is due on March 16th."

The Riddle of the Stem Cell Trinity

Can science, business and government work together in a win-win combination in a unique endeavor involving arguably the most controversial research in the world and billions of dollars in funding?

That is the key question ultimately for the California stem cell agency. Now we have some help in seeking answers to at least two-thirds of the riddle.

The aid comes from an analysis by Harvard business professor Gary Pisano in his new book: "Science Business: The Promise the Reality and the Future of Biotech." Pisano examines the sometimes difficult mix of business and science and their conflicting cultures. He omits the hefty government component represented by an agency such as CIRM, which has deeper hooks into science and business than the NIH.

Pisano, who has a Ph.D. from UC Berkeley, has studied the biotech business for years and has served as a consultant to some biotech companies.

We ran across his book as the result of a review in the Wall Street Journal by Andy Kessler, author of "The End of Medicine." Kessler wrote:

"Can science and business mix? ...The problem, according to the Harvard Business School professor, is that today's corporate structures are allergic to the uncertainty and risk inherent in science."

Kessler noted:

"Cumulative profits for the entire biotech industry are meager. The whole lot of them probably drip red ink if you take out Amgen, a 26-year-old company with $14 billion in annual sales and -- like Genentech and just a handful of others -- real profits."

Kessler continued:

"Mr. Pisano notes that 'drug R&D is a highly complex process; it is expensive, time consuming, and fraught with risk. In these respects, drug R&D is not too different from, say, the development of a new airliner, a new microprocessor, or even an epic movie.' The key word is risk. While an Airbus plane, Intel's Core Duo or 'Apocalypto' may have market risk, their development is undertaken with confidence that the products will at least make it to market; drug companies begin work on a new product with no idea whether it will even make it out of the lab, much less progress through clinical trials and onto drugstore shelves. A new drug might have the potential to be a blockbuster, but, then again, only one drug out of 6,000 newly developed compounds actually goes on sale. 'Productivity' is not a word used often in the drug business.

"'Drug development is a gamble in itself simply because of the hit-or-miss nature of the science -- or the 'profound and persistent uncertainty,' as Mr. Pisano calls it, 'rooted in our current limited knowledge of human biological systems.' But it becomes a staggeringly expensive gamble -- like playing blackjack at a table with a billion-dollar minimum -- because of the facilities required and the legions of experts in chemistry, biology, genomics and other fields who pour their time and energy into research. The 'nature of this process is integral,' Mr. Pisano points out. 'It cannot be broken neatly into different pieces.'"

Kessler's review prompted us to purchase the book, which appears to be very much worth reading. You can find a lengthy excerpt here or purchase it by clicking on one of the Amazon ads at the top of this blog.

Beware the White Coat Crowd

Health industry gadfly Merrill Goozner is taking a jaundiced view of the stem cell arms race in states across the country.

Citing New York's latest proposal and California among other states, Goozner wrote on The Huffington Post:

"Stem cell research is promising, and it shouldn't be impeded by a bunch of anti-science right-to-lifers with God and the president on their side. But like any strain of research, the likelihood of a major medical breakthrough coming from stem cells is probably not that much greater than gene therapy, the human genome project, the war on cancer or any of the multi-billion-dollar medical research programs that came before it. A lot of knowledge and a few good things will come out of stem cell research, but will it make those with severed spines stand up and walk? Call me irreligious, but I'm skeptical."

He continued:

"Of course, there will be some new jobs created for university researchers, their underpaid foreign graduate students, and the white coat crowd in the biotech industrial parks subsidized by the taxpayers. But is this really the best use of government subsidies, especially at a time when the health care sector -- 16 percent of GDP and still growing -- is sapping the vitality of the rest of the economy? Has anyone given any thought to how much some of these breakthrough stem cell technologies might cost, and how the rest of the economy might pay for them?"

Goozner is directs the Integrity in Science Project at the Washington-based Center for Science in the Public Interest.