The California Stem Cell Agency and $435 Million in Budget 'Bafflegab'

The finances of the $3 billion California stem cell agency are something less than transparent, a situation that today led a longtime CIRM observer to write about its "funny money" and the lack of an accurate accounting of where the agency stands.

The comments came from John M. Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., who wrote against the backdrop of California's $40 billion budget crisis. Simpson ran through the budget arithmetic and noted that CIRM has awarded $635 million in grants, many of which are multiyear. According to information Simpson compiled from CIRM, the state treasurer and state controller's offices, he said CIRM has committed $435 million it doesn't yet have.

CIRM Chairman Robert Klein had a chance to explain the situation last week before the directors' Finance Subcommittee. Instead, Simpson wrote, "there was discussion of a proposed loan program and two recaps" of how CIRM dealt with bond anticipation notes in 2005 and 2006.

Simpson said,

"What's been missing in all of this is an accurate accounting of where CIRM stands financially."

Simpson continued,

"Here's my two-cents worth:  Somebody in this highly paid group needs to present a real budget that shows when CIRM will run out of money.  Then there needs to  be a serious, realistic discussion about what to do about it. Approving more grants when you're already $435 million in the hole might just not be the prudent course.

"One thing for certain, the ICOC (the CIRM board) and public are entitled to a clear explanation of where CIRM stands financially, not bafflegab about pie-in-the sky funding schemes and Obama stimulus packages."

The subject of CIRM finances is on the board of directors' agenda for Thursday and Friday as it was last week before the Finance panel. In the past, the subcommittee presentation is merely repeated at the full board meeting.

What is needed is a straight-forward budget and finance document (far more than a sketchy PowerPoint presentation). It should include all the numbers, written explanations of assumptions and caveats, possible future scenarios, strategies to deal with various contingencies and the pros and cons. Anything less is a disservice to the people of California, not to mention the CIRM board and the hundreds of scientists whose work hangs on CIRM's financial well-being.

(We have told CIRM that if it has any comments on Simpson's remarks or this posting, we will carry its response verbatim. If you have comments, you can post them directly on this blog by clicking on the word "comments" below. Anonymous comments are permitted.)

(Editor's note: An earlier version of this item incorrectly said CIRM had approved $653 million in grants. The correct figure is $635 million.)

CIRM Staff Nixes Appeal Efforts from Two Scientists

The staff of the California stem cell agency has rejected two attempts to overturn negative decisions on two grant applications for a total of $2.8 million, one from the Bay Area and one from Southern California.

Following a relatively new procedure, CIRM President Alan Trounson said that the applicants failed to present "compelling evidence" for a change. Trounson referred to petitions by Susan Fisher(see color photo), a professor at UC San Francisco, who sought $904,172 , and Prue Talbot(see black and white photo), a professor at UC Riverside, who sought $1.9 million.

Both women disputed the decisions of the CIRM Grants Working Group on their applications, which were considered and voted on earlier behind closed doors. Later this week, CIRM directors could overturn the actions by reviewers. However, in December, in the only other instance of the use of the new petition procedure, the board stood by the decisions of reviewers after the CIRM staff could find no compelling evidence for a reversal.

Here is what Trounson had to say on Fisher's petition:

"We agree that reviewers considered this a meritorious application. The proposal to create an 'antibody tool kit for human embryonic stem cells and their progeny' was highly regarded but not unique. To clarify, there is at least one other application in Tier 2 that proposes the development of an antibody tool kit.

"In regard to the reviewer criticisms, we believe that reviewers were justified in raising concern about the PI’s overall commitments as the application lists 15 currently active projects that consume 87% of the PI’s effort. In addition, the PI lists 3 pending projects that would consume 40% effort. Regardless of additional personnel that can help lead the project, the PI is ultimately responsible for managing and ensuring that the project is carried out as proposed. We disagree that the only way to increase the percent effort of a given individual is to remove another individual from the project. The CIRM Grants Administration Policy limits the annual salary requests for each key person to $207,000. It does not, however, limit the percent effort that an investigator can commit to a project. In fact, a key person may contribute any effort between 1 and 100 percent without requesting any salary support from the CIRM grant. Therefore, the budget cap alone should not prevent an investigator from contributing greater effort when appropriate. We recognize that effort contributed to a project should be appropriately compensated, but the CIRM grant should not necessarily be viewed as the sole source of support."

Here is what Trounson said concerning Talbot's petition:

"We appreciate the arguments presented by Dr. Talbot on strengths of this proposal. Reviewers agreed that the institution’s designation as a Hispanic Serving Institution provides an important opportunity for the recruitment and training of underrepresented minorities and this point was highlighted and accounted for in the score and final recommendation. However, this important strength was balanced by the reviewers’ assessment of the overall quality and design of the training program. When compared to other competing proposals, this application did not convince reviewers that the training opportunities would provide sufficient depth and breath to trainees. It is also important to note that the existing training of students in stem cell biology referenced in the letter was not articulated in the application despite the opportunity to do so.

"The applicant’s letter also indicates that their application for the Training Grant Program in 2005 received a higher score and recommendation than for this review. We believe that there are many factors that might contribute to this difference including among others a general strengthening of competing programs in the last 3 years, a different composition of reviewers, and a different (although similar) proposal from the applicant. Reviewers based their recommendation on the proposal that was presented to them for the current competition and not the previous."

The links to Trounson's comments also contain the petitions filed by the two scientists and the public summary of their grant reviews.

(A footnote: Fisher is featured in a video on the CIRM home page and CIRMTV dealing with Obama's inauguration.)

(An earlier version of this item did not contain the amount requested by Talbot and the total for both grants.)

Rutgers' Young on Geron Trials

Wise Young, the director of Rutgers Center for Collaborative Neuroscience and a grant reviewer for CIRM, has pulled together a fine overview of the science and media coverage of the Geron clinical trial.

In a piece complete with numbered footnotes, Young (see photo) wrote,

"The media response was massive [18]. The story was carried by almost every news source [18-20]. The community response was initially strongly positive. Coming on the 3rd day after President Barack Obama’s inauguration, some thought that the approval of the first HESC trial was due to Obama’s coming to power.

"The exuberance faded as people read the fine print. First, the trial is not for people with chronic spinal cord injury. It is intended to be used within 2 weeks after injury for people with complete thoracic spinal cord injury. Second, the goal of the trial is to show safety and feasibility, not necessarily efficacy. Third, the cells have been differentiated to the point that they are no longer acting as stem cells but only as oligodendroglia."

Young also wrote,

"Geron’s web site and news reports indicate that the trial will treat 8-10 patients who are within 2 weeks after “complete” thoracic spinal cord injury. It will probably start in July 2009. However, many details are unclear. Before the FDA placed a hold on the trial application in May 2008, Geron had said that the cells would be transplanted into the spinal cord of patients undergoing spinal cord decompressive surgery and all the patients will receive a 2-month period of pharmacological immunosuppression . It is not clear that the same regimen will be used.

"In the meantime, the reaction of the spinal cord injury community has ranged from exuberance over the approval of the first HESC trial [22] to deep pessimism over comments by Okarma, who said that people with “complete” spinal cord injury have no chance of recovering any function, or something to this effect. Many people in the spinal cord injury community [23] were disappointed at being excluded from the study which is only for the newly injured."

Geron: Stock Market Star?

The Wall Street Journal reported today that Geron has become a "sudden star" on the options market.

The piece by Rob Curran said,

"On the options market, about 24,500 call contracts giving the right to buy the stock traded against 3,600 put contracts giving the right to sell, according to TrackData.

"At 4 p.m. (Monday) in Nasdaq Stock Market trading, Geron was up 15% at $8.15. That follows Friday's roughly 36% jump.

"Shares of the developer of therapies based on stem-cell research had languished in recent years along with academic and corporate research in its niche of genetic medicine. The shares rallied Friday after the U.S. Food and Drug Administration cleared the way for the first-ever trial of a therapy derived from embryonic stem cells. That sudden swing and the promise of more like it is what drew options traders to the stock Monday, said Frederic Ruffy, options strategist at Whatstrading.com.

"'The volatility in the share price attracts a lot of option traders,' Mr. Ruffy said.

"'One of the themes you can make a lot of money with is if you can ... predict new policies,' said William Lefkowitz, derivatives strategist at vFinance Investments. 'You don't really need results to make lot of money at the beginning of the administration.'"

At the time of this writing Tuesday morning, Geron stock stood at $7.55, down 7 percent.

If you cannot access the WSJ story and would like to see it, send an email to djensen@californiastemcellreport.com and I will send it to you.

Trounson and the California Stem Cell Story

As part of his job, CIRM President Alan Trounson trots around California and elsewhere, telling the story of how and why the state is pumping $3 billion into human embryonic stem cell research.

If you would like to hear one of his talks and see the PowerPoint presentations that he uses, you can do so by going to the web site of the Milken Institute, an economic think-tank in Santa Monica, Ca.

The institute is offering a two-hour video of Trounson, including his responses to questions following his talk last Thursday (Jan. 22). Trounson has an accessible and easy speaking style, and his presentation slides are downloadable.

Some of the highlights:

Trounson almost let the Geron cat out of the bag although by the time of his talk, the information had already been fed to a number of media outlets, including the New York Times and the Wall Street Journal for publication on Friday.

Trounson had high praise for his tiny, 38-person staff. He noted that CIRM operates with a 6 percent administrative budget cap, compared to 10 percent to 12 percent for administrative costs in other similar organizations with some running as high as 25 percent.

He predicted as many as 100 applications in the upcoming $210 million disease team grant round, which is part of the $1 billion that CIRM has already specifically committed to funding. The disease team round is one of the largest given by CIRM.

He said the performance of grant recipients is closely tracked with under-performers being advised to get their "underdone bits" properly done.

In response to a question about the $40 billion California state budget crisis, Trounson said it is having an "impact." But he said, "We are well insulated from the effects of politics and the economy." Trounson said CIRM has enough money to "get through about October." He noted that CIRM Chairman Robert Klein is making contingency plans should California be unable to sell the bonds that provide the funds for CIRM.

The budget deadlock and CIRM's budget is also up for discussion at the CIRM board of directors meeting this Thursday and Friday.

ISSCR , $400,000 and CIRM

Remember the request that the California stem cell agency pony up $400,000 to support next year's annual meeting of the International Society for Stem Cell Research in San Francisco?

It ran into some rocky sledding at the CIRM directors' meeting last month. Some of us had expected it to come back at the board meeting later this week.

But no. John M. Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., today wrote about last month's robust discussion of the request and has put together an explanation for the delay on his organization's blog. He quoted CIRM spokesman Don Gibbons as saying,

"We are examining other possible alternatives for the ISSCR meeting and will bring the issue back at a later date."

We were also wondering about the matter and last week separately queried scientist Irv Weissman of Stanford, incoming president of the society. He replied,

"I have no idea what is or is not on the ICOC (CIRM directors) agenda. I sure hope CIRM will assist the ISSCR convention, but I am not really knowledgeable what they can or cannot fund. I trust them to do the right thing. Irv Weissman, speaking for himself."

More Info for This Week's CIRM Board Meeting

The California stem cell agency today posted additional information for its board of directors meeting this Thursday and Friday, including fresh links to the underwriting plan for its $500 million biotech lending program.

We previously linked to that information but it is now on the official agenda for the sessions in Burlingame. Yet to come is the revised loan administration policy.

Also posted are the names and bios of proposed new alternate grant reviewers: Charles Cox of the University of Texas in Houston, John Rasko of the University of Sydney stem cell program and Peter Zandstra of the stem cell bioengineering program at the University of Toronto.

Another offsite teleconference location for Friday has been added beside the one in Colorado. The latest one is at or near UCLA in Los Angeles. Addresses can be found on the agenda.

Geron Price Still Moving Smartly Upward

Geron rose sharply again today, closing at $8.15, up 15 percent for the day.

Barrons reported that Needham Research upgraded its recommendation on Geron from hold to buy with a $9 price target. Needham said "significant unmet needs" exist "in the management of spinal-cord injuries."

Needham also said that Geron previously reported it had $165 million available at the end of 2008 with a projected burn rate of $50 million -- "financial resources...sufficient for operations for several years."

Meanwhile Motley Fool reported that a large group of its readers gave Geron a "distressing two-star ranking," meaning that it might lag the market.

Pluses and Minuses in the Geron News Coverage

Media coverage and commentary continued to ripple out today on the Geron clinical trial announcement, generating considerable attention also on California's $3 billion stem cell research effort.

While CIRM has not played a role in the Geron research, the agency's expertise has popped up in many stories with quotes from President Alan Trounson and Chairman Robert Klein along with references to the size of the state effort. All of which helps meet one of the agency's goals of becoming a key media source in all things stem cell.

As usual in such events, the initial coverage on Geron generally tended to be favorable for both the company and for stem cell research. Television news coverage also surfaced, which is rare on stem cell issues. There is no doubt that the Geron announcement is important in establishing a favorable public view of both the science and the business. The expected Obama administration changes in federal stem cell research rules will add to the positive climate and are likely to come in the near future.

But some not-so-ebullient views could be heard as well. The San Francisco Chronicle editorialized this morning that the Geron trials are a "a cautious but unmistakable advance."

The Chronicle continued,

"At this early point, it's mainly about testing the safety of the treatment. That's a key issue because a harmful result or botched trial could set back the stem cell cause immeasurably, a risk that researchers acknowledge."

Reporter Steve Johnson of the San Jose Mercury News wrote,

"California's $3 billion effort to fund such research, launched in 2004, illustrates some of the obstacles federal officials could face in trying to lure companies to begin such studies.

"Aside from being hindered by legal challenges during its first few years, California's program has funneled the vast majority of its money so far for basic research at universities and other nonprofit institutions. And for a variety of reasons — ranging from a lack of investors to skittishness over the ethical debate surrounding the cells — only a handful of companies in the state are experimenting with embryonic stem cells on their own, despite predictions that the effort would quickly bring about a job boom.

"'I would have expected there to be more interest' among businesses, said Alan Trounson, president of the California Institute for Regenerative Medicine, which voters created in November 2004 by passing Proposition 71."

Senior columnist Adam Feuerstein of TheStreet.com had an even bleaker view. He wrote,

"I say don't buy into the hype.

"Geron has a long track record of over-promising and under-delivering. In fact, the company's only real accomplishment after years and years of effort has been to burn through tons of shareholder cash.

"Before you send emails that blast me for spitting on stem-cell therapies, understand that my cynicism is directed at Geron, not the promise of stem cells. Today's news was well orchestrated by Geron -- a splashy story in The New York Times, a conference call and an appearance on CNBC. But let's get real: Geron is starting a small phase I study, and with Friday's run, the stock's market cap now stands around $600 million. And for that, you get very little.

"Sorry, but Geron looks more like a short to me than a long."

Stanford's Christopher Thomas Scott released a statement that said,

"President Obama's intention to lift the restrictions on embryonic stem cell research, Congress' promised actions to legislate funding, and Geron's announcement are three important steps to a long road for cures and treatments. After an eight year drought, patience is needed. The federal government must retool those agencies and institutes bereft of stem cell expertise. The NIH must appropriate funding at a level needed to produce the kinds of results we need to have more encouraging news from the private sector. Finally, the states must enact policies that are in step with the new vision in Washington. This will take time. Once the US is back on track, then it can do what it does best: discover, translate, and develop the science and treatments for its citizens."

Here some links to other interesting stories on the Geron trial and its implications:ABC News, Wired News (Trounson heavily quoted), The Associated Press and the Los Angeles Times.

Correction

The CIRM YouTube item Jan. 22, 2009, incorrectly stated that CIRM posted 28 videos on the CIRMTV site. The correct figure is 14. The number of videos was listed twice in two different categories on the CIRMTV site.

Fresh Comment

Jesse Reynolds of the Center for Genetics and Society of Oakland, Ca., has posted a comment on the "Klein Wants $10 Billion" item. In it, Reynolds identifies as the source of the job multiplier information used by Klein a much-criticized, $200,000 report paid for by the Prop. 71 campaign in 2004. The document was prepared by a Stanford economist who Klein did not identify in the material he presented last Wednesday to the CIRM directors Finance Subcommittee.

Geron Stock Finishes Day up 36 Percent

Geron stock closed at $7.09 today, up 36 percent with the biggest one-day gain in five years, according to Bloomberg.com.

Bloomberg said,

"The FDA’s action may help pave the way for other companies to get permission to start their own trials, said Christopher Thomas Scott, director of Stanford University’s Stem Cells in Society program.

"'Geron is a path-breaking company in getting the first stem-cell trial,'Scott said in a telephone interview yesterday. 'The message is that FDA now feels comfortable with the measure of risk the first trial will contain for the first few patients.'

Bloomberg continued,

"Two other U.S. companies, Advanced Cell Technology Inc. of Los Angeles, and closely held Novocell Inc., based in San Diego, are using embryonic stem cells to develop therapies and are working to begin clinical trials.

"Less than one biotechnology drug out of three that enter clinical trials is approved, said Joseph DiMasi, an economist with the Tufts University Center for the Study of Drug Development in Boston. That risk of failure also applies to Geron, which has spent $45 million preparing an FDA submission on the stem-cell treatment."

From the Reed Family: A Thankful Perspective on the Geron Trials

Don Reed of Fremont, Ca., is a nearly tireless and good-hearted advocate for human embryonic stem cell research. Today's announcement concerning the Geron clinical trials has special meaning for him and his family. We asked him for comment. Here is what he sent.

"MAGNIFICENT BEGINNING

"Don, Roman, and the entire Reed family would like to congratulate Geron Corporation and the stem cell research community for today's wonderful news.

Years ago, California's Roman Reed Spinal Cord Injury Research Act of 1999 funded Dr. Hans Keirstead's pioneering work, just approved for human trials by the FDA. These particular trials, to re-insulate nerves in the damaged spine, will involve only newly injured individuals. But they are forerunners of the day when paralysis will no longer be an automatic life sentence in a prison of immobility.

"Roman was asked by a reporter: what was the first thing he would do on the day when regenerative medicine allows him to walk again?

"He replied: 'I want to walk down the beach, hand in hand with my wife Terri, and toss a ball around with my children.'

"A small dream -- and an enormous one-- because if we can cure paralysis, the very symbol of that which has been called incurable, we can do anything.

"Congratulations to all, and may the New Year, and the new administration, live up to this magnificent beginning.

"Thank you,"

Don C. Reed

Fresh Details on $500 Million Biotech Loan Plan and Underwriting

For those of you looking for more information on the California state plans to start a $500 million loan program for the biotech industry, you can find the latest details stuck away in the Internet archives of the state's stem cell agency.

The biotech loan program and a proposal to hire a delegated underwriter to run it will come up at next Friday's CIRM board meeting in Burlingame, Ca., with an off-site, teleconference location in Broomfield, Co.

No significant information is available via the agenda for the board meeting, but eight documents related to the loan proposal can be found. They were posted on Wednesday just hours before the meeting of the Finance Subcommittee at which they were to be considered. The dilatory posting, a perennial problem at CIRM, basically denied the public or interested parties the ability to make any sort of thoughtful comment at the Wednesday session.

Following the meeting, the documents could only be found shunted off to the archives, five layers down from the home page. That's because the agency generally, but not always, moves agendas for past meetings to its archive site. At some point, CIRM may move the links to the documents to the agenda for the board meeting, three layers down from the CIRM home page.

We asked Don Gibbons, chief communications officer for CIRM, what action was taken on the biotech loan documents. Here is the verbatim text of his reply:

"passed a motion to recommend the LAP to the board as is with the provision that council work with Roth, Goldberg and Penhoet between now and the meeting to refine language on page 9 (redline version) related to loan repayment when project is abandoned."

LAP refers to the loan adminstration policy.

We have not had a chance to digest all the information contained in the eight documents, but wanted to let interested parties know where they could be found. One document came from Silicon Valley Bank and another from Orix Venture Finance in response to a CIRM request for information on structuring the underwriting program.

The Silicon Valley document consisted of only a PowerPoint presentation, apparently a duplicate of one made last year to a panel of CIRM directors. Previously, however, the Silicon Valley presentation was not available via the CIRM website.

Other documents include various versions of the loan administration policy.


(If you have thoughts on any of these issues, you can comment by clicking on the word "comment" below. Anonymous comments are permitted. Or you can write CIRM directly via its web site and ask to have your comments made part of the public comment allowed at each CIRM board meeting.)

UCI Touts Role in Geron Trials

The University of California, Irvine was quick today to put out a news release on its role in development of the Geron therapy that is now moving into history-making clinical trials.

The school headlined the release: "UCI behind world's first embryonic stem cell study in humans." And it said,

"A therapy developed at UC Irvine that made paralyzed rats walk again will become the world’s first embryonic stem cell treatment tested in humans."

Specifically mentioned were Hans Kierstad (see lower photo) and Gabriel Nistor, who published their work in 2005, generating considerable international attention. Kierstad's smiling face dominated the entire home page of UCI today. We asked Nistor to send us a photo which is at the top.

The release also noted that UCI has received more than $52 million from the California stem cell agency. It did not mention that Susan Bryant, vce Chancellor for research at the UCI School of Biological Sciences, and Oswald Steward, director of the UCI Reeve-Irvine Research Center at the campus, sit on the agency's board of directors.

Stem Cell Stocks Rising on Geron's Good News

Geron's high-flying coattails are having a sharp impact today on the prices of some of its competitors.

Streetinsider.com reported earlier today that Aastrom Biosciences, Inc., of Ann Arbor, Mi., and StemCells Inc. of Palo Alto, Ca.,, both jumped 30 percent. At that point, Geron was up 50 percent. (StemCells Inc. was founded by Irv Weissman of Stanford, Fred Gage of the Salk Institute and David Anderson of Caltech.)

Meanwhile scientist Hans Kierstad of UC Irvine or one of his associates has emblazoned "a flash" on the website at California Stem Cell Inc. Geron's hESC therapy is based on technology invented and co-developed by Kierstad and Gabriel Nistor, also of UC Irvine. Kierstad is the chairman of the California Stem Cell scientific advisory board, of which Nisor is also a member.

At the time of this writing, Geron's stock price stood at $7.64, up 47 percent.

CIRM Publishes Reviews on $66 Million Grant Round; Names of Applicants Remain Secret

Ranked and scored reviews of applications for $66 million in stem cell/biotech training grants can now be found on the web site of the California stem cell agency, which is expected to give away the money next Thursday or Friday.

None of the names of the institutions proposing the programs have been disclosed by CIRM in keeping with its longstanding and mistaken policy of not disclosing the identities of those who are seeking public funds. The names of the winners ultimately will be made public, after they been officially approved. CIRM never releases the names of the losers.

The recommendations, which are in reality de facto decisions, of the Grant Working Group that are virtually certain to be ratified by the full CIRM board can be found in the categories of "recommended for funding" and "not recommended for funding." CIRM directors almost never have overturned those decisions by grant reviewers in the process of approving 253 grants since 2005.

Something of a case can be made for not revealing the names of individual scientists who compete for the grants on the grounds that it could be embarrassing. But not to disclose the names of the enterprises – many of which are publicly funded institutions – serves no public interest. It prevents the public from making thoughtful comments on the grants and has led to an embarrassing situation for CIRM itself involving a $2.6 million grant to CHA RMI of Los Angeles. (Following the flap, CHA ultimately withdrew its application.)

In contrast, stem cell insiders are not likely to have too much difficulty in determining the identities of most of the applicants based on the material in the grant reviews.

That said, CIRM is to be commended for posting the links to the reviews on Thursday in reasonably timely fashion ahead of the CIRM board meeting.

Here is where you can find the reviews for the $18 million program to train lab personnel and the $48 million effort to train young scientists.

San Diego UT: California Stem Cell Effort Leads Nation

In a fortuitous bit of timing, the leading newspaper in one of California's stem cell hotbeds today ran a front page story declaring that the state's "taxpayer-funded investment has allowed it to build the infrastructure that puts it ahead of every other state."

The article by Terri Somers in the San Diego Union-Tribune was prepared earlier but it was published the same morning that Geron announced the federal go-ahead on its vaunted hESC clinical trials. The timing promises to generate more general interest in Somers' piece and the field overall.

Somers constructed a broad overview of the state of stem cell research in the nation but particularly in California. Her piece does sound some cautionary notes, including this from researcher Larry Golstein of UC San Diego.

"The devil will be in the details," said Goldstein of how the Obama Administration deals with both executive regulation of stem cell science and legislation controlling hESC reserarch.

Geron Stock Soars 20 Percent on Approval of Clinical Trials

Today is a big, big day for California's Geron Corp., which has received federal approval to begin "the world's first study of a treatment based on human embryonic stem cells."

The Associated Press covered the basics of the action. An early version of its story said said,

"The company gained federal permission this week to inject eight to 10 patients with cells derived from embryonic cells, said Dr. Thomas Okarma(see photo), president and CEO of Geron Corp. of Menlo Park, Calif.

"The patients will be paraplegics, who can use their arms but can't walk. They will receive a single injection within two weeks of their injury.

"The study is aimed at testing the safety of the procedure, but doctors will also look for signs of improvement like return of sensation or movement in the legs, Okarma said."

Andrew Pollack of the New York Times provided a nuanced, comprehensive piece. He reported on the political and scientific implications and quoted Robert Klein, chairman of the California stem cell agency, on the move.

Klein said the FDA approval was tied to the Obama Administration although that was denied by an FDA spokesman and Geron.

Geron's stock rose 20 percent early this morning, hitting $6.26 at 9:47 a.m. EST, close to its 52-week high of $6.55.

Here are links to the Geron press release and other stories about the much-delayed trial: Geron (includes video), Wall Street Journal , AFP and Financial Times.

Klein Wants $10 Billion in Aid From Obama Administration

The chairman of California's state stem cell research agency, Robert Klein, has unveiled more details of what appears to be a $10 billion-plus proposal seeking assistance from the Obama Administration to aid the biomedical industry.

Some of Klein's proposals would clearly benefit industry and researchers in California, but they also could have an impact in locations throughout the nation that have either major biotech industry centers or research facilities.

Klein laid out his thoughts in a draft of a five-page letter during a meeting Wednesday of the directors' Finance Subcommittee. John M. Simpson, stem cell project director for Consumer Watchdog of Santa Monica, Ca., who sat in on the session, said the meeting was running late and Klein's plan was not even discussed. Klein said people should read it so it can be taken up at CIRM's full board meeting next week.

Klein proposed five "federal initiatives." They include a $1.5 billion biomedical lab construction effort, $2.1 billion for assistance to some established state government research programs (presumably including California), a $3 billion loan guarantee program that appears to dovetail with Klein's $500 million biotech lending plan and $6 billion for increased NIH funding of biomedical research. The fifth element would allow some small biotech firms to sell their R&D credits. It contained no price tag.

The letter and accompanying chart promised that the proposals would generate 159,832 "job years" based on estimates provided by an unidentified Stanford economist. The Klein letter did not explain the assumptions underlying the multipliers that were used to come up with the job count.

The letter appears to be directed primarily at Congress. However, it is not clear whether it has actually been sent.

The proposals are the subject of a report scheduled to be discussed next Thursday by CIRM directors in Burlingame. We have asked Don Gibbons, chief communications officer for CIRM, if Klein intends to seek a vote on the proposals or whether he will simply ask them to sign it. He could take an assistance pitch under his signature alone, but we suspect that he would like to have all the board members endorsing it. One question that directors should ask is whether Klein or other CIRM employees will be traveling to Washington or other locations to lobby for the proposals. Another is how much staff time is being devoted to this effort at a tiny, 38-person agency that is chronically understaffed.

Klein's proposals to join the bailout/stimulus gravy train in Washington have grown rapidly over the past few months. CIRM itself, however, is currently well-financed and needs little assistance from the federal government. We have noted that there is a certain logic to Klein's effort. But we have also noted that the Obama Administration's financial pie is limited and that CIRM should step out of the federal hand-out line.