The California stem cell agency has identified a number of risks and benefits that are associated with its $150 million plan to create a public-private company to advance stem cell therapies.
Risks and rewards were laid out in its spending/strategic plan for the next five years, which was approved by directors last December. The discussion of risks in the plan and other proposals as well is a hallmark of the administration of CIRM CEO Randy Mills, who joined the agency about two years ago. Prior to his arrival, the agency's staff did not formally offer risk assessments for its proposals.
The $150 million proposal has been dubbed ATP3 -- short for Accelerating Therapeutics through Public-Private Partnerships. The financing for the deal is up for approval tomorrow by CIRM directors.
CIRM's List of Benefits From ATP3
"The aggregation of a basket of otherwise unpartnered CIRM projects offers the successful applicant 'multiple shots on goal.' This increases the probability of successfully developing and commercializing a stem cell treatment and makes significant industry investment in stem cell technology more attractive."
to make substantial investments in stem cell research. The lack of a track record of
success, coupled with the regulatory uncertainty discussed above, have dissuaded
them from making a substantial commitment to the field. This has exacerbated the
challenges posed by the so-called 'valley of death' between discovery and clinical
translation where funding has traditionally been scarce.
Benefits to researchers: "continued funding for the advancement of their CIRM
project"
Benefits to universities: "demand creation for the out-licensing of CIRM-funded
technologies with a greater opportunity to achieve a financial return due to the aggregation of risk"
Benefits to citizens of California: "the creation of an industrial stem cell treatment powerhouse that expands the tax base, adds high quality jobs, and increases the likelihood of the commercialization of stem cell treatments for patients with unmet needs"
A CIRM memo last week also identified possible financial benefits to the state or CIRM via royalties and/or sale of the state's interest in the company.
project"
Benefits to universities: "demand creation for the out-licensing of CIRM-funded
technologies with a greater opportunity to achieve a financial return due to the aggregation of risk"
Benefits to citizens of California: "the creation of an industrial stem cell treatment powerhouse that expands the tax base, adds high quality jobs, and increases the likelihood of the commercialization of stem cell treatments for patients with unmet needs"
A CIRM memo last week also identified possible financial benefits to the state or CIRM via royalties and/or sale of the state's interest in the company.
CIRM's Evaluation of Risk
"Investors may be uninterested in stem cell treatments" is what the agency's strategic plan said in December 2015.
It continued:
"To date, venture capital and the pharma and biotech sectors have been unwilling to make substantial investments in stem cell research. The lack of a track record of
success, coupled with the regulatory uncertainty discussed above, have dissuaded
them from making a substantial commitment to the field. This has exacerbated the
challenges posed by the so-called 'valley of death' between discovery and clinical
translation where funding has traditionally been scarce.
"Although California voters made a substantial investment in CIRM when they approved Prop. 71, CIRM, by itself, does not have the funding necessary to translate the many discoveries made
by researchers it has funded into treatments. Indeed, the costs of developing a single drug are estimated to be $2.6 billion.
by researchers it has funded into treatments. Indeed, the costs of developing a single drug are estimated to be $2.6 billion.
"For CIRM to succeed in its mission, CIRM must partner with other investors to bring treatments to market and deliver them to patients. CIRM plans to address this concern by continuing to champion CIRM - funded project to potential partners and investors and by creating a demand for CIRM -funded projects through public-private partnership designed to accelerate treatment development, described in section 7 of this plan."
Other general risks are identified in three pages of risk laid out in the strategic plan, including insufficient "meritorious treatments," safety concerns, FDA reluctance and inadequate health benefits from stem cell treatments.