Latest California Budget Proposal Not the Best News for CIRM

California Gov. Jerry Brown is proposing a "dramatically" reduced sale of state bonds, which are the only real source of income for the California stem cell agency, during the coming fiscal year.

His plan was contained in what is the known as the May revise of the governor's budget. Randall Jensen(no relation to this writer) wrote today in The Bond Buyer, a newswpaper devoted to public finance, that the plan is part of an effort to reduce what Brown called California's $81 billion "wall of debt."  Jensen said,

"The state already skipped its usual springtime general obligation bond issue at Brown’s behest. The revised budget proposal calls for selling only about $1.5 billion of GO (general obligation) bonds in the fall, as the state’s only GO issue of calendar year 2011, after selling $10.5 billion of GOs in 2010."

Brown also proposed a $2.4 billion bond sale in the spring of 2012. He said the state currently has a backlog of $48.2 billion in unsold bonds.

If CIRM bonds are not part of the fall sale, it could lead to a cash flow crunch at CIRM, which says it has only enough funds on hand to meet its current commitments through about June of 2012. Competition for inclusion in the bond sale is likely to be stiff.

Brown's bond sales plans also assume enactment of his budget. However, Republicans have in the past  successfully blocked tax increases, which are part of the spending plan, because of the requirement of a two-thirds vote for approval.

(Editor's note: An earlier version of this item incorrectly indicated that CIRM had funds through June. The correct date is about June of 2012.)

Former Genentech Exec Appointed to CIRM Board

Stephen Juelsgaard (Photo Iowa State)

A former, longtime Genentech executive yesterday was named to the 29-member board of the $3 billion California stem cell agency.

Stephen Juelsgaard of Woodside, Ca., was appointed by California Lt. Gov. Gavin Newsom to replace Ed Penhoet, a co-founder of Chiron. Penhoet had sat on the board since the agency's inception in 2004. He was vice chairman at one point and directed development of CIRM's intellectual property provisions. Juelsgaard fills a slot on the board reserved for a representative from a life science business.

Juelsgaard is a lecturer at the Stanford law school and a member of the board of directors of Ivivi Health Sciences LLC of San Francisco, a privately held firm that focuses on electrotherapy devices to relieve pain.

Juelsgaard was executive vice president of Genentech when he left the firm in 2009. He joined it 1985. Last fall he endowed a deanship at Iowa State University with $3 million. Juelsgaard holds a doctorate in veterinary medicine from the school.

Another former Genentech attorney, Elona Baum, is general counsel at CIRM, which has about 50 employees.

Trounson Joins the Blogging World

The president of the $3 billion California stem cell agency, Alan Trounson, has taken up blogging.

While he is no Matt Drudge(the high impact political blogger in Washington, D.C.), Trounson's effort is worth regular scrutiny especially by scientists seeking CIRM cash.

Blogger Trounson

Trounson blogged on April 22 about his views on current stem cell research around the world. His item was an extension of the summaries that he presents to CIRM directors at their regular meetings.

Trounson wrote,

"Since I arrived at CIRM late in 2007 I have maintained a tradition of presenting some of the top science journal papers from the previous month or two at each of our board meetings. Beginning last month, I decided this would be easier to digest in a written document than in PowerPoint slides amid a harried board meeting. You can see an archive of these periodic stem cell reports on our website.

"This month I want to start a second part of the new tradition, a brief blog note to let you know why I, as someone who toiled in stem cell labs for many years, chose these items as some of the most important papers in the field in the past month or so."

Trounson went on to comment, via a separate link, on research by M. Eiraku, Sheng Ding, Elias Zambidis, Howard Chang, R. Perlingeiro, P. Ma, Shinya Yamanaka, E. Morrisey and Richard Lee.

Trounson's new endeavor is a worthwhile contribution. It provides insight for other scientists and interested parties into the thinking at the highest level of a major funding organization.

As for Trounson's comments about PowerPoint, he is spot on. PowerPoint burdens every meeting of the CIRM board of directors and is a lazy and poor way of presenting complex information. Some critics refer to PowerPoint-induced sleep and death by PowerPoint. Says one critic,

"PowerPoint makes us stupid."

The PowerPoint problem, pervasive in many organizations, may have been best captured in an article last year about its impact on the American military. The headline on the New York Times story said,

"We have met the enemy and he is PowerPoint."

Consider this follow-up comment on military.com:

"The amount of information that gets conveyed in 20 Powerpoint slides is probably less than a five page paper. It takes forever to brief it, which limits the time for serious discussion by the audience or the senior officials who are subjected to the presentation.

"With Powerpoint, the military has been moving toward an oral tradition and away from the written word, with all the demands for precision, nuance and serious exposition that writing requires. And it's not just a problem for the military. The procedure has become quite common in other areas of government, among contractors and in think tanks.

"Sometimes Powerpoint presentations are used as a kind of bureaucratic filibuster: they can be a way to eat up time and restrict the opportunity for hard questions. But even when that is not the intent they are generally not the best means of communication. Clear and concise writing requires that issues be thought through and that is not always necessary if all that is required is to slap a few bullets on a slide.

"It would be far more efficient to prepare a concise and analytical paper that provides the essential information and arguments, circulate it in advance and then take questions about the assessment and recommendations at a meeting. If maps, graphics and charts are important they can be attached to the paper as needed. The essential information could be absorbed before the meeting, which could then be devoted to serious debate and discussion."

Enough said. I will now dismount from my PowerPoint soapbox.

California Budget Mess Hamstrings Fresh Funding for Stem Cell Agency

The prospects for new sales of California state bonds – the only source of funding for the $3 billion California stem cell agency – remain dim, according to an article today in Bond Buyer.

"The California bond market has become hamstrung by the delay" in coming up with a prudent state budget in Sacramento, wrote Randall Jensen in the public finance newspaper.

Jensen(no relation to this writer) reported,

"California has no plans to go to market until the fall, and even that is far from ­certain. 'We still hope to be in the market this fall to sell $5.5 billion to $6 billion of GO bonds.  But the treasurer has no interest in selling bonds without a balanced budget in place,' said Tom ­Dresslar, a spokesman for state Treasurer Bill ­Lockyer.

"Dresslar said GO-bond financed public works programs have enough funds to make it though the end of the calendar year, but added that if the state doesn’t go to market until next year current projects could face a shutdown."

The stem cell agency says it has sufficient cash to fund current commitments until roughly June of next year. There is no guarantee, however, that the agency would receive funds via the first round of bond sales even when they do occur. The state has about $37 billion in bonds awaiting sale. Competition for allocations will be stiff.

Outgoing CIRM Chairman Robert Klein told directors last month that he had hoped for new bond funds this past winter. According to the transcript of the directors' Finance Subcommittee meeting on April 19, Klein said,

"It should be remembered that because of the large collaborative teams we build in California for disease teams, for example, or large collaborative teams that are necessary for clinical trials, and the international teams that we need to make certain that we retain a working reserve so that we provide assurances to these teams that this extraordinary effort they put together to bring together institutions and special expertise is not defeated, although we have an approved loan or grant. So, for that matter, it's important to the industry as well."

Missing Items: Problems with Blog Host

Two recent items have vanished from this blog because of worldwide problems with the hosting service, Blogger, which is part of Google's operations. Blogger says it is attempting to restore the items, which have disappeared from all of its thousands of blogs. If not, we will restore them later. Thanks for your patience.

Geron Loan Draws Media Attention to CIRM

The state of California's first-ever venture into a clinical trial involving human embryonic stem cells garnered more than the usual news coverage last week for the Golden State's $3 billion stem cell research effort.

At least more than usual for the stem cell agency, which has received modest attention in the mainstream media in recent years.

The $25 million loan to Geron Inc. of Menlo Park, Ca., drew articles in newspapers ranging from the Los Angeles Times to the San Francisco Business Times. However, the story was ignored by the San Francisco Chronicle, the San Jose Mercury News and The Sacramento Bee, based on our searches. That despite the fact that the circulation areas of the San Francisco and San Jose papers include the headquarters of both Geron and the California stem cell agency.

The lack of coverage by those papers undoubtedly is a reflection of the current overtaxed nature of the newspaper business along with the difficulty of peddling stem cell research stories to reporters and editors.

Keith Darce of the San Diego Union-Tribune had most developed story that we saw. It included comments from another stem cell company and termed the award "historic." Darce also pointed out that the loan is part of CIRM's effort to help stem cell companies through what is known as a financial valley of death – a period in which it is difficult to find conventional financing.

Eryn Brown at the Los Angeles Times, the state's largest newspaper and which has paid scant attention to CIRM, wrote,

"John M. Simpson, a consumer advocate with Consumer Watchdog in Santa Monica, Calif., said that making a loan to support a clinical trial made sense.  While his group has worried in the past about awards becoming 'boondoggles,' he said in this case Geron's trial was vetted carefully and the company met the requirements needed for funding. 'It could provide cures.  That's what everyone wants,' he said. 'I'm watching it with interest.'" 

CIRM's press release quoted outgoing agency Chairman Robert Klein as describing the state's investment as a "landmark step." But he cautioned that severe setbacks could be encountered. He said,

"We need to be prepared to stand by the heroic patients and the companies as they face these challenges and solve the problems that stand in the way of the recovery of patients from paralysis."

Over the last year, Klein has talked up another bond issue for CIRM that could total as much as $5 billion. CIRM operates on borrowed money (state bonds), which doubles the real cost of all its activities because of the interest expense.

To win voter approval of a new bond issue will require concrete results, such as those envisioned in the Geron trial, to justify continued state support of stem cell research.

Geron's three-year clinical trial is aimed at assessing the safety of its treatment. Any regular use of the therapy is probably a decade or more away because of the need to test its efficacy and to clear regulatory hurdles. Geron hopes to enroll 10 patients in its trial. The firm picked up its second in Chicago, according to a report this week.

Here are links to more stories, some of which incorrectly described the award as a grant, along with links to press releases on the state loan to Geron: Geron's press release, CIRM's press release, CaliforniaHealthline, Science magazine, Nature, myfoxla.com(two Los Angeles TV stations), xconomy and Fierce Biotech,

Coming up

We have dropped the hook in Panama in a bay near the entrance to the Panama Canal, where behemoths of the sea parade by hourly on their way to the Atlantic Ocean. We are catching up on California stem cell affairs and hope to have a fresh posting soon.

Lure of the Sea

The siren call of the sea is being heard once again. We are raising anchor to continue our journey to Panama from our current location in Puerto Jimenez in Costa Rica. The California Stem Cell Report will go dark, so to speak, until we find another Internet connection, which could range from a few days to about two weeks. Rest assured – or not so assured – that postings will resume in the not-too-distant future.

CIRM Directors Tackle Grant Appeal Problems

The longstanding issues involving appeals of grant reviewer decisions at the $3 billion California stem cell agency will be taken up once again April 26 by the directors' Science Subcommittee.

The agenda also includes possible action on a bank for reprogrammed stem cells.

No details are yet available on any of the proposals to be considered, but potential applicants for grants and loans would be advised to watch the appeals changes closely.

California Stem Cell Report Cited as One of 25 Best Stem Cell Blogs

The California Stem Cell Report has been named one of the 25 best stem cell blogs by a web site targeting readers interested in nursing education.

In preparing the list, nursingschools.net said,

"Whether you’re pursuing a career in medicine or science, if you’d like to keep up with these advances, then blogs on the issue are one of the best tools out there. Here, you’ll find a collection of blogs that provide all the information you’ll need to stay on top of the latest in stem cell discoveries."

The web site said of the California Stem Cell Report,

"See how stem cell politics are affecting research and development in California through this blog written by journalist David Jensen."

Also mentioned were blogs with California ties and one from the California stem cell agency. CIRM Research Results, produced by Amy Adams, was the only government blog cited. Nursingschools.net said Adams' report "shares" CIRM's "latest discoveries and political battles."

Two blogs by scientists were among the 25 including one by Paul Knoepfler of UC Davis and another Robert Lanza of Advanced Cell Technology of Santa Monica, Ca.

Of Knoepfler's work, the web site said, "The UC Davis School of Medicine maintains this blog, providing readers with information on everything stem cell as well as other science-related issues."

Of Lanza, the web site said, "Dr. Robert Lanza is a scientist and professor working on issues related to cell technology and engineering; his blog will provide readers with some insights into the field and his research."

Another blog cited was Ben's Stem Cell News. Nursingschools.net said, "Ben Kaplan is a (California) stem cell activist, blogger and a biotech professional who shares his thoughts and the latest information on stem cells here."

Kaplan appeared in campaign ads in 2004 for Prop. 71, which created the California stem cell agency.

California Stem Cell Agency Plans a More Than 16 Percent Budget Boost

The California stem cell agency is proposing an $18.5 million operational budget for the coming fiscal year that will include a more than 12 percent increase in staff and reflect the rising costs of monitoring more than 400 grants and loans.

The agency did not disclose the size of the increase for the spending plan compared to actual spending projected through the end of the current fiscal year June 30. CIRM only offered a comparision to spending that was approved last June ($16 million). The proposed budget is up 16 percent from that figure. The agency, however, has been running behind the approved spending levels so the actual budget increase is likely to be substantially higher than 16 percent.

In documents prepared for a meeting Tuesday of the CIRM directors' Finance Subcommittee, the agency's staff briefly noted that a cash crunch could occur in the coming fiscal year if the state does not sell additional bonds, the only real source of funding for CIRM's $3 billion effort. A continued suspension of bond sales is likely this year because of the state's financial crisis.

The budget document said,

"If no new bonds are sold during FY 2011-12, expenditures could reach the 6% (legal, Prop. 71)cap by June 2012. However, plans are progressing to request authorization for new bond sales this year."

No further information was provided concerning the bond situation, although it is to be considered as a separate item at the meeting next week.

The budget document said CIRM is "well aware" and "sensitive" to California's fiscal crisis and said its spending plan is aimed at controlling spending.

The document said it reflects "continued increases in the programs, activities and overall workload at CIRM, and it mirrors changes in the number of fulltime employees, which is expected to grow to 56 from the target for FY2010-11 of 50 (an increase of 12%)."

With $1.2 billion committed out of $3 billion, CIRM cited a significant increase in workload, including a 47 percent hike in "payment transactions" for grants and loans from 663 to 975 and a 21 percent increase from 467 to 563 in scientific progress reports and "prior approval requests" for changes in awards.

Eight new positions are proposed, up from the current staff level of 48(a 17 percent increase). One is a "director of public communications" in the office of the chair of the agency. Two others are an information technology director and a special projects officer to help CIRM President Alan Trounson develop new initiatives and deal with biotech industry executives.

The largest budget category is for compensation, $10.3 million. The second largest category is outside contracting at $3.3 million. "Direct legal costs," many of which are contracted, are scheduled to hit $2.3 million. The agency is heavily reliant on outside contracting because of the former legal limit of 50 on the size of its staff. That limit was removed by legislation that went into effect at the beginning of the year.

The spending plan shows that CIRM is still wrestling with its critical grants management system after several years of work. It proposes spending $933,977 on the effort this year out of a total information technology budget of $1.3 million. It is not clear whether that figure includes the hiring of an information technology director, as proposed elsewhere in the spending plan.

The office of the chair, which includes both outgoing Chairman Robert Klein and co-vice chair Art Torres, is budgeted for $3.9 million. Again no comparision is available to estimated spending for this year, but the figure is up from the $3 million approved last June for the current year. Klein says he will leave his post this June. No successor has been chosen. The largest increases in Klein's budget appear to be in compensation (new hires) and outside contracting.

The Finance Subcommittee is expected to forward its recommendations on the budget to the full CIRM board at its meeting in early June.

The budget information from CIRM is coming much earlier than it has in the last several years, a significant improvement in an important aspect of the agency's openness and transparency. It also provides directors and the public with ample time to examine the proposal, raise questions and make suggestions for changes.

The public can take part in the meeting at locations in San Francisco (3), Pleasanton, Palo Alto, Irvine, La Jolla and Berkeley, Specific addresses can be found on the agenda.

California Stem Cell Directors to Huddle on New Chair Candidates

A key group of directors of the California stem cell agency will meet
Tuesday behind closed doors to discuss candidates to succeed Robert Klein as chairman of the $3 billion research effort.

The Governance Subcommittee has scheduled the session although it does not have any official candidates for the post. Only four state officials – the governor, treasurer, controller and lieutenant governor – can nominate candidates for the position, which could pay up to $400,000 annually for parttime work. None have done so.

The four officials have said they will not make nominations until perhaps as late as May 23.

Over the last couple of months, however, CIRM directors have indicated that they might have names that they would like to discuss, in addition to meeting with individuals to see if they have an interest in serving.

Presumably next week's meeting will take up such matters.

Sailing with the Tide

are once again hoisting sail to move farther south (actually east and south) towards Panama. That means a hiatus in fresh items on the California Stem Cell Report at least until we find another Internet connection. How long will the break be? That is unknown but probably not more than three weeks. Less if we find an Internet cafe in one of the villages along the coast of Costa Rica or Panama.

Stem Cell Agency Moving Faster on Budget Preparation

It is fair to say that the $3 billion California stem cell agency is not a spendthrift organization – at least as far as its operational budget goes.

That's the money for salaries of its 48 employees, outside contracts (the second biggest item in the budget), monitoring grant performance and so forth. The agency is limited by law to spending only six percent of its $3 billion for overhead, an amount that many of its directors think is low, perhaps even inadequate. The limit was enshrined in state law by Prop. 71, the measure that created the stem cell research program in 2004.

That said, the agency has had difficulty in presenting a coherent proposed budget to its directors in a timely fashion. It has given them proposals that do not compare actual spending to proposed spending and which produce dubious numbers for the amount of increased spending. The proposed budgets, which are for fiscal years that begin July 1, have come late and have not allowed time for thoughtful examination by the CIRM governing board. (See here, here and here.)

This year promises an improvement. CIRM President Alan Trounson presented a schedule for the budget at the board's March meeting. It calls for presentation of the budget to the directors' Finance Subcommittee later this month with presentation to the full board in May. That is a full month ahead of what occurred in the past several years. It also allows time for the directors to ask for revisions that could be presented to them in June, before the beginning of the new fiscal year.

Michael Goldberg, a venture capitalist and chairman of the Finance Subcommittee, said he expects the panel to meet on April 19 to consider Trounson's proposed spending plan for 2011-12. Spending fror the current year was originally budgeted at about $16 million. Spending for the coming year should show increased costs for staff, given the new hires expected this year and the addition of a new vice president for research and development. Increased pension contributions for the agency staffers will also boost compensation expenses.

John Robson, vice president for operations, additionally told directors in March,

"Our number of progress reports has increased significantly, our grant and loan payments, those things impact significantly on the grants management office, the science office, and the finance office. The increase in work has gone up 25 to 35 percent just in the last year."

He continued,

"We also have a couple of one-time items that are going to be reasonably expensive. We have a performance audit that was stipulated by (state Senate) bill 1064. That's budgeted at about 250,000, and then there's the Institute of Medicine audit that the board has been working on, the chair's office, and we've budgeted 400,000 for that for this year with the balance...in the next fiscal year's budget."

Also likely to be discussed at the April 19 meeting is the near certainty that the state will not issue bonds until sometime in 2012, a situation that could bring CIRM perilously close to a serious cash flow crunch.

The agency's only source of funds is money that the state borrows (bonds). CIRM says it has sufficient cash on hand to meet existing commitments until June of 2012, but a delay in issuance of bonds could mean a slowdown in CIRM's aggressive grant schedule or worse.

In response to a query, Goldberg said.

"We are watching the situation closely."

iPSC Bank and Imaging Technology Sessions Offered by CIRM

The California stem cell agency this spring will be looking into both imaging technology for cellular therapies and ethical/policy questions dealing with reprogrammed stem cells.

The iPSC session April 29 in Los Angeles involves CIRM's Standards Working Group, which makes recommendations for rules for the agency's $3 billion research program. The meeting is a continuation of last year's session dealing with the banking of iPSCs. The goal of the meeting this year is to "recommend operational criteria that will assist CIRM in developing a request for proposal for the iPSC bank."

The draft agenda includes consent standards, withdrawal of subjects from research, transfer of materials and communication of results. The agenda said,

"The generation of iPSCs for disease modeling may results in published findings of interest to donors or individual results on research studies that would alter clinical management of donors. Under what conditions, if any, should information be returned to donors as groups or individuals?"

Coming up on May 26 is a webinar on imaging technology that will feature panelists from the FDA, the NIH and industry. Moderating it will be Ellen Feigal, formerly of Amgen but now the new VP for research and development at CIRM.

The agenda includes the "FDA’s perspective on imaging technology, the use of imaging technology in preclinical studies to assess cell fate" and an overview of existing and new imaging technology.

The webinar, which is part of CIRM's Regenerative Medicine Consortium program, is free but requires advance registration.

Look for Candidates for Chair of Stem Cell Agency in Late May

The California stem cell agency, which did not have much choice about the matter, has decided to go along with a delay in picking a new chairman for the $3 billion organization.

Outgoing Chairman Robert Klein, who is scheduled to depart in June, said the CIRM board is "amenable" to postponing until May 23 nominations to fill his shoes. Four state officials – the governor, treasurer, controller and lieutenant governor – are charged with nominating candidates for the part-time position, which could pay as much as $400,000 annually.

The CIRM board is limited to electing a chairman from those candidates, although it does not have to accept any. If the board were truly unhappy with the nominations, presumably it could designate an acting chairman or simply let the vice chairman assume responsibility in absence of a chairman. The latter action probably would not even require a vote of the board. On the other side of the coin, the officials cannot be compelled to make a nomination.

Klein's brief letter, also signed by co-vice chairman Art Torres, to the nominating officials came in response to a March 24 letter from all four officials balking at a CIRM board request 10 days earlier for nominations by April 11. The officials said more time was needed because of the importance of the position.

Klein said,

"We appreciate your desire to find a high caliber leader to replace CIRM's current board chair and the board is amendable to your proposed schedule."

Correction

The "pay plan" item on April 2, 2011, incorrectly stated that Ted Love is chair of the Evaluation Subcommittee. He is vice chair of that committee.

California Budget Mess Threatens CIRM Funding

The collapse of efforts to resolve California's financial crisis in June seems nearly certain to place the state's $3 billion stem cell research program perilously close to a serious cash crunch come next year.

The situation should come as no surprise to lame duck CIRM Chairman Robert Klein, who stunned the agency's governing board in 2009 with similar news. Additionally, in December of last year, only days after he told the CIRM directors Finance Subcommittee that no funding problems existed, Klein warned the full board that it was "essential" that the agency quickly provide assurances of "reliability of our funding."

Klein, a real estate investment banker, considers himself something of a government bond expert because of his experience with housing bonds. He says he and a handful of associates crafted the ballot initiative that created CIRM, Prop. 71, to avoid the financial vagaries that have plagued the NIH. To do that, he relied on borrowed money (state bonds), which makes everything CIRM does cost twice as much as it would on a normal basis. For example, the $20 million grant to scientist Dennis Carson at UC San Diego actually will cost state taxpayers about $40 million because of the interest on the borrowing. Interest costs for CIRM currently run $200,000 a day on the $1 billion it has borrowed so far.

Klein's plan assumed that the state would regularly issue bonds. However, beginning last January, the state suspended the sales of bonds for six months to avoid $248 million in additional interest costs. Today, the state budget remains many billions in the red, and most signs point to continuation of that bond delay decision.

Two days ago, The Bond Buyer financial newspaper reported that state Treasurer Bill Lockyer will not sell bonds until the state budget is balanced. Reporter Rich Saskal quoted Lockyer's spokesman, Tom Dresslar, as saying,

"The bottom line in terms of (revenue anticipation notes) and infrastructure bonds is the timely adoption of a balanced budget."

The California Stem Cell Report first discussed the bond sale problem on March 23. That was before the collapse of budget negotiations in Sacramento. The situation is much more serious today.

At this point, a balanced state budget is not likely to occur unless voters approve in November tax increases  – which they have previously rejected -- through a ballot initiative that is yet to be written. Even then, bond sales are not likely until sometime in 2012, according to Lockyer.

While CIRM says it has sufficient cash on hand to deal with its existing obligations until June of 2012, the agency's timetable calls for new grant rounds to continue to move forward aggressively this year and next. Extreme pressure will be felt in the treasurer's office from competing interests for urgent and early bond sales when they resume. And a good possibility exists that CIRM bond sales will not come up in the first round in 2012, assuming sales are resumed then.

On May 3-4, the 29 directors of the stem cell agency are scheduled to meet in Los Angeles. High on their agenda should be a discussion of finances and alternatives to ensure that CIRM's grant programs continue to move forward – albeit slowly -- even if bond revenues do not materialize until well into next year. Delay could be the operative response. Postponing new grant programs, RFAs for existing efforts and even payments to researchers and institutions – all could be on the table. One additional matter to discuss – designation of someone to deal with the full range of bond issues, given that Klein is leaving his post in less than three months, if not sooner.

Sacramento Bee Whacks Pay Plan for New CIRM Chair

In case you missed it, The Sacramento Bee editorialized last week about the $3 billion California stem cell agency, deploring its much-criticized, dual-CEO structure and the possibility of a $400,000 salary for a new, part-time chairman.

The March 28 editorial also caught the eye of Wesley J. Smith, a bioethicist who doesn't have much truck with the state's stem cell research program. He wrote on his blog,

"It isn’t the management structure that is so wrong about the CIRM.  It is the whole cronyism/conflicts of interest/arrogant thing.  California can’t afford the CIRM’s borrow and spend mandate when our infrastructure is collapsing and our state sinking to the bottom of a red ink Marianas Trench."

The Bee's editorial pointed to the proposal (first reported on the California Stem Cell Report March 23) by outgoing CIRM Chairman Robert Klein, a real estate investment banker, Art Torres, co-vice chairman of the CIRM and former state legislator, and Ted Love, a biotech industry executive and vice chair of CIRM's Evaluation Subcommittee, to use "private" donor funds to pay a portion of the new chairman's salary. The Bee said,

"Nonsense. It’s all public money. That board does not need a part-time chair with that kind of salary. The board should nix it at the next meeting. Having a single agency with two CEO-level salaries is craziness at any time, but especially during a deep economic downturn. The Legislature should realign the roles of board chair and agency president before this goes too far. Make it crystal clear that the full-time president manages all day-to-day operations – and that the board chair is a part-time oversight role."

The good news for CIRM in the editorial is that it drew only nine comments from readers on The Bee's Web site. All were negative about CIRM, however.

(Editor's note: an earlier version of this item incorrectly said that Ted Love was chair of the Evaluation Subcommittee.)

The Hook is Down

The California Stem Cell Report will resume postings later today from Bahia Ballena in Costa Rica. We have dropped the anchor for a few days and found an Internet connection, although it is a tad primitive. Look for an update on CIRM's looming financial problems and much more.