Kuehl's CIRM Bill Advances on 9-0 Vote

Despite opposition from the California stem cell agency, a state Senate committee Wednesday approved legislation aimed at ensuring that the state receives both an economic and health-related return on its $3 billion stem cell research effort.

CIRM opposed the measure – SB771 – on the grounds that it was premature. However, the Health Committee sent the legislation to the Senate Judiciary Committee on 9-0 vote. If it wins approval there, it will move on to the Senate floor, where it requires a whopping 70 percent vote for approval. That extraordinary requirement was dictated by Prop. 71. It was written into the initiative so that CIRM could operate virtually untouched by normal legislative and gubernatorial controls.

From our perch here in Mexico, we could not connect with the live Webcast of the proceedings. But we have been told that several senators pointed out to CIRM officials that they (the legislators) represent the public interest.

Lawmakers also did not see any barriers to advancing the legislation while CIRM, which is nearly three years old, continues to wrestle with its intellectual property rules, which the bill addresses. They asked CIRM to identify specific problems with the bill instead of arguing that it is premature.

Sen. Sheila Kuehl, D-Santa Monica, chair of the Health Committee and author of the bill, said she would work with CIRM to develop IP policies that make sense and protect the public interest.

She also pledged to develop methods to handle unique situations such as orphan drugs, for which there may not be as much room to demand revenues and pricing concessions.

As far as we can tell, no other news outlets have published stories on the Health Committee action.

CIRM Firm Against Kuehl Legislation

The Oversight Committee of the California stem cell agency Tuesday voted unanimously to oppose legislation aimed at ensuring that California shares the benefits of any therapies developed with $3 billion in state-funded research.

Reporter Terri Somers of the San Diego Union-Tribune wrote that the board considered the legislation "premature."

She quoted Dale Carlson, chief communications officer for CIRM, as saying the agency, which has been in existence for more than two years, should be given time to complete its policy-making process.

According to Somers, Carlson said,

"The board members appreciate that Senator Kuehl has an interest in fair prices, fair access and fair returns to the state. Those are our objectives as well. We'd like the opportunity to continue to work with her and other members of the Legislature to come up with a mechanism that best achieves those objectives."

Sheila Kuehl, D-Santa Monica, and state Senate Republican leader George Runner of Antelope Valley are co-authors of the bill, SB771, which comes before Kuehl's Health Committee this afternoon. The session will be broadcast live on the CalChannel.

Also now available online is the Health Committee staff analysis of the measure, which explains the bill in straightforward terms.

Somers, by the way, appears to be the only reporter in California who wrote a story based on Tuesday's Oversight Committee meeting.

Stem Cell Snippets: Labs, Cha and Pomeroy

Wasteful Lab Duplication – Reporter Nicole Gaouette of the Los Angeles Times wrote about how George Bush's stem cell funding edict has resulted in wasteful efforts in stem cell research. The article indirectly raises a question about how much money NIH spends chasing down possible violations of the ambiguous and dubious directive. Gaouette uses examples from UC San Francisco and Advanced Cell Technology in Alameda, Ca.

Cash for Large Stem Cell Facilities – Reporter Terri Somers of the San Diego Union-Tribune reported that CIRM hopes to have $225 million available for large stem cell research labs. Applications could be ready this summer. Recipients would have match at least 20 percent of the grant, according to the initial proposal.

CHA – The Scientist magazine has the latest on the Cha affair with a statement from Alan DeCherney that the publications committee of the American Society for Reproductive Medicine will meet Friday to discuss the matter. Also now available onine is the full text of the British Medical Journal article concerning the case.

Pomeroy – Claire Pomeroy, a member of the CIRM Oversight Committee and dean of the UC Davis School of Medicine, discusses stem cell issues in the Sacramento News and Review. Among other things, she worries about stem cell tourism – the practice of folks seeking stem cell therapies abroad. In many cases, inadequate oversight exists. She also reviews the status of stem cell research at the UC Davis campus. The Cal Aggie campus newspaper also carried a piece on a presentation to the Oversight Committee Tuesday on vascular disease research.

CIRM Litigation – The folks seeking to put CIRM out of business have filed with the State Supreme Court their request to overturn two earlier decisions against them. The court has until June 5 to make its decision.

State of Affairs – Reporter David Louie broadcast a piece on San Francisco TV station KGO on April 10 that reviewed the stem state of affairs in California. He said that thanks to CIRM, the state is
"is already well on the way to making its own breakthroughs in stem cell research."

Live Internet Broadcast of CIRM IP Legislation

One advantage that the Big Tomato, as Sacramento is sometimes known, has over other cities in California is that seems a little better wired in terms of bringing state government information to users of the Internet.

For example, you can hear remarks by California stem cell Chairman Robert Klein to the Sacramento Press Club on Monday on the Press Club's web site. A video is promised as well on the CalChannel website.

For your planning purposes, Wednesday's hearing of the Senate Health Committee on SB771 will be broadcast live on CalChannel. If you want to view it, you might tune in early to one of the other broadcasts to be sure your computer is properly configured for playing the live video.

Minimal Stem Cell Coverage in Sacramento

News coverage of an appearance by California stem cell chairman Robert Klein in Sacramento was light today with perhaps the most interesting piece appearing on a local television station.

Reporter Kevin Riggs broke little new ground for readers of this blog, but he probably brought important information to viewers of television station KCRA, one of the major players in the Sacramento TV market.

TV stations rarely cover the stem cell agency in California. At the same time, most people get their news from the electronic media – not newspapers. So the perspective and images from the rare TV stories are significant in assessing how the public perceives CIRM.

In this case, Riggs' report was generally favorable with strong images of scientists doing work in labs at UC Davis. He had an interview with Klein, who deplored the legal efforts by opponents to stymie the agency. Riggs also had an interview with an opponent of the agency who complained about conflicts of interest. You can find a partial text of the story here, but to really understand what was said and see the visuals, click on the adjacent video.

Jim Downing of The Sacramento Bee also wrote about Klein's appearance in a story that focused on the stem cell debate in Washington, D.C.

As far as we can tell, those were the only two stories out of Klein's appearance Monday. Nothing appeared concerning the CIRM hearing on IP Monday afternoon, based on an Internet search.

Sacramento Bee: Curb Klein's 'Political Adventures'

"Nagging problems" persist at the California stem cell agency, including "political adventures" by its chairman, Robert Klein, The Sacramento Bee said today.

In an editorial, The Bee said that in addition to Klein's dabbling in politics, the problems include efforts by the biotech industry to weaken CIRM rules to generate revenue and affordable care and failure to disclose the economic interests of scientists who review applications for hundreds of millions of dollars in grants.

The Bee had some good things to say as well. CIRM is now "the nation's largest financier of embryonic stem cell research," which is what voters approved in 2004, newspaper said.

In its "memo" to CIRM, The Bee said:

"You've also hired a fine scientific staff to help administer grants and design a strategic plan. These employees will help your institute transition to new leadership, since President Zach Hall will be retiring in June and you are currently interviewing for his replacement."

But the newspaper said,

"Your board chairman, Robert Klein, continues to dabble in political adventures that don't comport with his responsibilities as a public official. Last year, he used a nonprofit organization to campaign against state Sen. Deborah Ortiz in her bid for secretary of state, after Ortiz had sought reforms in the stem cell institute. Klein's nonprofit also took sides in the lieutenant governor race. Rarely have we seen the head of a state agency create his own separate political apparatus to punish enemies and reward friends. These tactics have hurt the institute's standing and you need to put an end to them."

The editorial also said:

"So far, you've resisted public disclosure, claiming it could scare away qualified reviewers. Yet researchers make such disclosures all the time. As one of your reviewers, Rainer Storb, told The Scientist last year, such disclosures "are a bit of a nuisance. But I'm perfectly fine with things being made public."

Sacramento's Stem Cell Topic of The Week: Sharing the Swag

You could call it Stem Cell Week in the Big Tomato, as Sacramento is sometimes known. Today begins a round of events in the capital city linked closely to the California stem cell agency and the dreaded topic of intellectual property, which really is a simple question of who wins and who loses.

California stem cell Chairman Robert Klein speaks today at a luncheon meeting of Sacramento Press Club, followed by a CIRM hearing this afternoon on IP issues. Tomorrow the institute's Oversight Committee holds a meeting in Sacramento. And on Wednesday, the Senate Health Committee takes up SB771, legislation by Sen. Sheila Kuehl, D-Santa Monica, aimed at ensuring a return to the state on products developed as a result of the state-funded research. Her bill is also aimed at providing affordable access to stem cell therapies. (For more background see "White Knights.")

We have already seen opposition to the measure from California's biotech industry. But three other groups have announced support or at least partial support.

Donna Gerber, governmental relations director of the California Nurses Association, sent an endorsement letter to Kuehl, which said,

"Without the changes proposed by SB771, Prop. 71 has the potential to become a direct giveaway of three to six billion dollars in public funds to large biotech and pharmaceutical corporations that stand to make enormous sums of profits off the public through.

"Current regulations do not ensure that uninsured residents, who have few resources to pay for expensive stem cell treatments, will be able to access those therapies when they become available. They also restrict the ability of the publicly funded programs to get discounts on stem cell therapies the state has helped pay to develop. Similarly, the regulations propose to cap the state's share of revenues from products developed with Prop. 71 funds, instead of allowing the state to receive a return commensurate with its contribution to the research.

"SB771 will ensure that the state benefits from its $3 billion investment in stem cell research by requiring research grantees and licensees to share revenues from the stem cell therapies that the state has paid to help develop and provide discounts on stem cell drugs."

Marcy Darnovsky, associate executive director of the Center for Genetics and Society, wrote,

"This bill would ensure that the state receives a fair return from any profitable discoveries made with publicly-funded stem cell research while improving access by economically vulnerable Californians. But we are concerned that the bill as currently written does not go far enough to protect Californians from potentially unfair pricing practices.

"However, we are concerned that potentially unfair pricing practices could harm Californians. If faced with excessively high prices for drugs or treatments, insurers would likely either pass the costs on to patients or fail to cover them. No one wants to see medical treatments developed with public funds be inaccessible to middle-class Californians who have medical insurance. We would like to see SB 771 amended to provide a specific mechanism or procedure with which the state can act to prevent excessive pricing of inventions developed with public funding."

A third group, the California Alliance for Consumer Protection, endorsed the measure, declaring it will help ensure that there will be continuing funds for stem cell research, among other reasons.

(Editor's note: Sacramento is known as the Big Tomato because of the thousands of acres of tomatoes that are grown in the vicinity. Decades ago, the Sacramento River used to run red with waste from tomato processors during the summer.)

Fresh Comments, No. 1, April 9, 2007

JeongHwan Kim, the researcher whose work was allegedly plagiarized in the Cha matter, has responded in a comment on the "Harvard's Kim Responds" item below. Lawrence Ebert has also posted commentary on the same item.

Editor's Advisory on Recent Cha Items

If you haven't checked this blog since late Friday, a lot of fresh information has been posted on the Cha matter. We recommend that you begin with the "British Medical Journal" item. That will establish the framework for the additional material, which is largely original source stuff from some of the folks involved. Lawrence Ebert has commented widely on the material as well on his blog – Ipbiz.

Fresh Comments

Lawrence Ebert has posted fresh comments on the "Lee Letter" and "Baristas" items below. Ebert has written at more length on what he calls "Cha-gate" on his blog – Ipbiz. See "CIRM grant" and "Fulminations." Ebert also links to the article in The Scientist on the plagiarism issue, which also has additional commentary from readers, including Sook-Hwan Lee's letter.

Harvard's Kim Responds on the Cha Matter

Following publication of the British Medical Journal item below, we queried one of those mentioned, Kwang-Soo Kim, whether he had anything further to say on the matter. He forwarded the following via Tony Knight of Sitrick and Company, a public relations firm.

"After learning about this incident, I was quite frustrated and concerned
with the situation and, thus, personally investigated the matter by carefully discussing the details with each of the authors of the paper. My conclusion is that this is a most unfortunate situation stemming from a disgruntled junior scientist's unprofessional conduct which appears to have been unnecessarily amplified by an all-too-eager reporter who was either misinformed or is not properly reporting all the facts of the case.

"However, we are hopeful that with the disclosure and consideration of all the facts involved, a fair outcome will result not only in the pending legal proceeding but also with Fertility and Sterility.

"As a fellow research scientist with more than 23 years of research experience in the U.S., as well as knowledge of the scientific community in Korea, I feel some background information may prove to be helpful and insightful regarding the dual- publication issue.

"I personally have very strong objections to this practice where the dual publication in a non-SCI Korean journal and an SCI journal were pursued. I do not know for certain how widespread this practice has been in recent years. But I am pleased that it was halted in 2006 with the publication of a new guideline by Korean scientific leaders.

"Given that the practice of publishing in both a non-SCI domestic journal and a SCI international journal was accepted by some in Korean, it is somewhat understandable that Dr. Lee followed this practice, although I think it was a terrible mistake. All the other authors were not even aware of the fact that this paper was previously published in a Korean journal and, thus, are innocent.

"We at Pochon CHA University believe the matter should be corrected, and Dr. Lee is planning to retract the first paper from the Korean journal. The paper's scientific integrity is without question and it should remain in F&S.

"Based on my conversations with all of the other authors, I believe that Dr. Kim's contribution was marginal compared to the research project in total. Authorship of a scientific paper is based less on who drafted the text than on who performed the scientific work and whose original idea and investigative thought went into the research. In particular, in this type of genetic studies, it is crucial how the samples are organized and collected, including both patient and control samples. Dr. Kim deserves authorship because of his partial but direct contribution, and Dr. Lee did credit him as an author in her submission of the manuscript to F&S.

"Needless to say, the data and results produced from a lab are attributable to the principal investigator and the rightful, proprietary property of the sponsoring institution. The fact of the matter is that Dr. Lee was the principal investigator and director of the lab and all of the resulting data was attributable to Dr. Lee and the rightful property of CHA Hospital. It is also a fact that Dr. Kim took this data without anyone's knowledge or proper permission which was a huge violation of trust with Dr. Lee, the other researchers and the entire organization, as well as a serious breach of company policy and that of the implicit rule regarding research data and intellectual property within every research lab. I believe this is why he did not leave any contact information and could not be reached."

Text of CHA Response to a Variety of Issues

The three following items were provided today by a representative of CHA in response to queries by the California Stem Cell Report. One is a letter to the editor of the Los Angeles Times, which has not been published as of the date of this writing. The other was sent to The Scientist magazine and is posted on their web site. The final document is information prepared in connection with the grant by the California stem cell agency to CHA RMI.

All of the items are posted verbatim as received from Tony Knight of Sitrick and Company, a Los Angeles "strategic communications" firm.

Cha Letter to Los Angeles Times

Text of letter to Los Angeles Times

Letters to the Editor

Los Angeles Times
202 W 1st Street
Los Angeles, CA 90012

Fax- 213-237-7679
letters@latimes.com

Dear Editor:

Your stories, “Stem cell grant OKd for L.A. center linked to allegations” (March 26) and “Credit for U.S. journal article at issue” (February 18), inaccurately portrayed the controversy over an article in the journal Fertility & Sterility as a “plagiarism dispute.”

As the one who originated the idea for the project and provided guidance and oversight for the collection of the patient samples, I was entitled under the relevant rules to a “first author” credit.

Dr. Jeong-Hwan Kim says he should have been listed as an author. In fact, Dr. Sook-Hwan Lee’s Feb. 5, 2005 letter to F&S, enclosing the manuscript, credited Dr. Kim with “clinicopathological analysis and statistical analysis." Even so, the sample data collection work had begun well before Dr. Kim became involved.

Dr. Kim’s name was dropped when he left Korea and he could not be found to sign the paperwork required by F&S. When Dr. Kim was located in 2006, Dr. Lee wrote letters to F&S asking his inclusion as an author.

The research was done at the Human Genetics Laboratory of CHA Hospital, where Dr. Lee was the director. Lab documentation shows that Dr. Kim’s contribution to the actual research was marginal. He collected two of the 30 patient samples, and none of the control samples. Other CHA doctors and laboratory scientists collected the other specimens and accomplished all DNA extraction. Dr. Kim compiled the basic statistics
and wrote the thesis in Korean.

As Dr. Lee informed The Times, Dr. Kim submitted the paper in Korean to the Korean Journal of Obstetrics and Gynecology (KSOG), listing himself as first and corresponding author, without her knowledge or consent. She translated the article into English for F&S, and she was the only author who knew of the prior KSOG publication.

None of the other authors, including myself, were aware of the article’s prior publication. Dr. Lee was correctly listed as an author on both papers, so plagiarism is also out of the question with regard to Dr. Lee.

Finally, your article said I had improperly used M.D. after my name on web sites of U.S. clinics and laboratories that are part of the CHA family of institutions. The web sites that refer to me are aimed at an international audience. I am the Chancellor of the College of Medicine at Pochon CHA University, a trained physician, licensed to practice medicine in Korea. I do not practice medicine in California and have never held myself out as a physician practicing in California.

Regards,

Kwang Yul Cha, M.D.
Chancellor
Pochon CHA University College of Medicine

Lee Letter to The Scientist

Text of letter to The Scientist

March 22, 2007

Richard Gallagher
Editor
The Scientist

Dear Editor:

Your February 20 article “Fertility journal censures scientists” contained inaccuracies and omitted important facts regarding a paper by myself and my colleagues in the journal Fertility & Sterility titled The Quantitative Analysis of Mitochondrial DNA Copy Number in Premature Ovarian Failure Patients Using the Real-Time Polymerase Chain Reaction (2005).

It is not true that Dr. Jeong Hwan Kim “performed the bulk of the research,” nor is it true the paper was submitted to F&S without Dr. Kim listed as an author. As of this writing, F&S has not censured me or any other authors. And Dr. DeCherney’s comment that all of the authors of the paper “perjured themselves” is baseless, as I will explain below.

The concept for this research originated with Dr. Kwang-Yul Cha in 1998. Dr. Cha and I designed and wrote the research proposal in 2001. Korea’s Ministry of Health and Welfare funded the research. My intent from the beginning was to seek publication in an SCI journal.

Most of the research was accomplished by myself and other researchers in the Human Genetics Laboratory of CHA Hospital. Dr. Kim became involved in 2002 when he asked for my guidance on his doctorate thesis and joined us as a part-time researcher.

I am told that he claims to have collected all 30 of the POF patient samples. We have documented proof he collected only two patients’ samples, and he collected no control samples. Other CHA Hospital doctors collected most specimens, and other scientists at the Human Genetics Laboratory accomplished all DNA extraction, prerequisite for real-time PCR. Dr. Kim compiled the basic statistics and wrote the thesis in Korean.

I agreed to help Dr. Kim with his doctoral thesis and permit him to participate in the research on the condition that any resulting paper would be submitted to an SCI journal. Upon receiving his degree from another institution, however, Dr. Kim submitted the thesis in Korean to the non-SCI Korean Journal of Obstetrics and Gynecology (KSOG), listing himself as first and corresponding author, without my knowledge or consent.

He also took all of our data without authorization and moved out of Korea leaving no forwarding address. I subsequently filed a legal complaint against Dr. Kim that is being investigated by the Korean Public Prosecutors Office.

Unable to locate Dr. Kim, KSOG recognized my name among the authors listed and contacted me. This was the first I was aware the paper had been submitted to KSOG.

Perhaps I should not have done so for my student, but I agreed to be the corresponding author when KSOG could not find Dr. Kim. (I am told that Dr. Kim says locating him would have been easy, but KSOG was unable to find him. More recently, an official Korean Public Prosecutors Office document stated that his whereabouts were “unverifiable.”)

The loss of our original data deprived me of an ability to write a second paper, yet I remained committed to submitting the research to an SCI publication. I translated the KSOG paper into English and submitted it to F&S with myself as the corresponding author.

Dr. Cha was listed as the first author on the F&S article because he originated the idea for the project and provided guidance and oversight for the collection of the patient samples. He was entitled under the relevant rules to “first author” credit.

Dr. Kim was included as an author on the original submission to F&S. My Feb. 5, 2005 letter to the editor of F&S, enclosing the manuscript, credited him with "clinicopathologica1 analysis and statistical analysis."

But Dr. Kim could not be found to sign paperwork required by F&S. His name was dropped for this reason only. When Dr Kim surfaced in 2006, I wrote two letters to F&S requesting his inclusion as an author. F&S never replied.

The paperwork F&S required the authors to sign was related to “financial” conflict of interests, not prior publication. None of the other authors, except myself, knew that the article had been published in KSOG. Hence, Dr. DeCherney’s ‘perjury’ allegation against the authors is without merit.

I express my sincere regret for the controversy and assume full responsibility as the corresponding author of the paper. No one else is to blame. No harm, sanctions or reputational damage should be directed to my co-authors.

I ask that you publish this letter in full in order to set the record straight.

Sincerely,

Sook-Hwan Lee, M.D., Ph.D

CHA RMI Statement on CIRM Grant

Text of the CHA RMI Statement:

March 24, 2007

Statement CHA Regenerative Medicine Institute

CHA Regenerative Medicine Institute is a non-profit organization
incorporated in California on Dec. 21, 2005 and has been engaged in
adult and embryonic stem cell research at its Los Angeles laboratory.

CHA RMI's mission is to develop regenerative cell and gene therapies for
the treatment and cure of human diseases. CHA RMI focuses its research
on advancing therapeutic cloning technology to create patient-specific
stem cells using fresh and frozen human eggs.

CHA RMI is able to bring to California patented vitrification technology
first developed at CHA BIOTECH and other advanced proprietary stem cell
technologies, which would otherwise not be available in the state,
because of its association with CHA Stem Cell Institute. All of CHA
RMI's facilities and research staff are located in California and all of
its work will be done in the state.

CHA RMI's research scientists are presently focused on:
* Production of embryonic stem cell lines from somatic cell
nuclear transfer- embryos
* Establishment of embryonic stem cells from donated eggs
* Differentiation of embryonic stem cells into specific cell
types.
* Investigation of adult stem cells for diabetes

CHA RMI's articles of incorporation state that it is organized under the
Nonprofit Public Benefit Law for charitable purposes and is not
organized for the private gain of any person. The articles further state
that the property of this corporation is irrevocably dedicated to
charitable purposes and no part of the net income or assets of this
corporation shall every inure to the benefit of any director, officer or
member thereof or to the benefit of any private person.

CHA RMI is associated with CHA BIOTECH, a leading stem cell research
institute in Korea, established in September 2000 by Pochon CHA
University College of Medicine and CHA General Hospital Group in order
to create a central, multidisciplinary research facility where the
university's scientists and hospital physicians could come together and
focus their efforts on developing stem cell, gene therapy and
regenerative medicine technology.

CHA BIOTECH, however, does not have any ownership interest in CHA RMI
nor does it have any voting rights on the Board. None of the member
companies belonging to CHA Health Systems have any ownership interest in
CHA RMI and none of the companies have any voting rights on CHA RMI's
Board.

Dr. Kwang Yul Cha, Chancellor of Pochon CHA University College of
Medicine, was listed as the initial chief executive and a member of the
Board of CHA RMI during the time when the non-profit laboratory was
being established. He has since resigned from these positions according
to the reorganization plan that was intended from the inception of the
institute. Dr. Cha does not hold any administrative or managerial title
at CHA RMI.

Dr. Cha is an internationally known fertility specialist with more than
100 articles published in peer-reviewed scientific journals. He received
his medical degree from Yonsei University in Seoul, Korea, and performed
his postdoctoral fellowship in endocrinology and infertility at the
University of Southern California. He also served as a visiting
professor at Columbia University

Dr. Cha succeeded with Korea's first Gamete Intra Fallopian Transfer,
Asia's first pregnancy in a woman without ovaries and the world's first
pregnancy from in vitro culture of immature oocytes collected from
unstimulated ovaries.

His research has received awards from the American Society for
Reproductive Medicine and the International Federation of Fertility
Societies. His research accomplishments have been featured in stories by
Time magazine, The New York Times and The Wall Street Journal.

Since its establishment in December 2005, CHA RMI has received approval
from the Western Institutional Review Board (WIRB) to conduct embryonic
stem cell research using frozen human eggs. This approval makes CHA RMI
the first research institute in the world to receive permission to
conduct stem cell research using frozen human eggs.

On March 16th, 2007, CHA RMI was awarded a $2,556,066 grant from the
California Institute for Regenerative Medicine (CIRM) to conduct
research in the "Establishment Of Stem Cell Lines From Somatic Cell
Nuclear Transfer-Embryos in Humans." The purpose of the research is to
provide a novel resource to the biomedical research community to study
and understand how genes correlate with the development of diseases such
as Amyotrophic Lateral Scelerosis (ALS), also known as Lou Gehrig's
disease.

CIRM's President and Chief Scientific Officer Zach W. Hall, Ph.D.,
stated: "These grants provide substantial support to a pool of very
distinguished researchers in human embryonic stem cell research." He
added that because of the size of the grants, "Our reviewers had higher
expectations and more rigorous standards for judging this set of
applications."

In its review of the "impact and significance" of the proposed research,
CIRM wrote: "As no ALS embryonic stem cells are currently available, the
isolation and characterization of such a diseased line will not only
provide the beginning of a proof of concept for this technology, but
more importantly will establish a realistic platform to study the
molecular basis of ALS, a devastating disease which remains incurable.
The other main significance of this work is the use of frozen oocytes
instead of fresh oocytes, which alleviates a number of ethical issues
regarding payments for donations to patients. This should not be
underestimated, as this simple fact is one of the major limitations of
SCNT approaches."

The principal investigator of the CIRM sponsored research is Jang-Won
Lee, Ph.D., who received his doctoral degree in animal science from the
University of Connecticut. Dr. Lee had been a research fellow at Wake
Forest Institute Regenerative Medicine, Winston Salem, NC and at
Children's Hospital & Harvard Medical School, Boston, MA. Before
assuming his post at CHA RMI, Dr. Lee holds an assistant professor
position at Pochon CHA University College of Medicine.

A full copy of the CIRM review can be found at:
http://www.cirm.ca.gov/publicsummaries/RFA_06-02/summary/RC1-00123-1.htm
l

British Medical Journal Discloses More Details in Cha Matter

The British Medical Journal has taken up the matter of Kwang Yul Cha and allegations of plagiarism against him, an issue that has raised concerns from two stem cell watch dog groups in California.

The four-page article in the April 7 issue of BMJ begins like this:

"A bitter dispute over the authorship of a twice published medical paper has pitted a 35 year-old Korean doctor against one of the most powerful players in the country’s struggle for biotech supremacy. The battle is threatening to disrupt Korea’s efforts to recover scientific credibility in the wake of the recent scandal over Woo-Sok Hwang’s stem cell research."

Cha is of special interest in California because the state's stem cell agency last month approved a $2.6 million research grant to a non-profit subsidiary, CHA RMI, of the CHA Health Systems organization, which is headed by Cha. The Oversight Committee of the California stem cell agency approved the grant with little discussion and no public notice prior to approval that it was for CHI RMI. CIRM's standard practice is to withhold the names of grant applicants. Following public disclosure six days later of the linkage between CHA RMI and Cha, two watchdog groups raised questions about grant.

The BMJ article was written by Jonathan Gornall, who added details and new information to what already has been reported concerning Cha. Gornall wrote:

"Now, as the dispute escalates into a series of allegations and counter allegations, the editor in chief of Fertility and Sterility has been accused of defamation and threatened with legal action by Dr. Cha. However, the BMJ has also learnt that following an investigation by the public prosecutor’s office in Korea, Dr. Sook Hwan Lee, one of Dr. Cha’s coauthors on the disputed paper, has been charged with criminal copyright infringement. The dispute is a major embarrassment for the CHA organisation, which only recently hired Professor Kwang Soo Kim, a respected Harvard professor, to boost its credibility in stem cell research."

Gornall continued:

"On 7 March, Dr.(Alan) DeCherney (editor of Fertility and Sterility) received a letter from lawyers acting on behalf of Dr. Cha. It quoted comments attributed to him in the LA Times on 18 February and in The Scientist on 20 February and accused him of having made 'false and defamatory statements' about Dr. Cha. It threatened legal action and demanded that Dr. DeCherney sign a statement of retraction. The letter, seen by the BMJ, calls for Dr. DeCherney to 'acknowledge that 1) Dr. Cha was entitled to be credited as an author of the F&S [Fertility and Sterility] article; 2) you have no reason to disbelieve Dr. Cha’s statement that he was unaware of the prior publication in the KSOG Journal; and 3) Dr. Cha did not plagiarise Dr. (Jeong Hwan) Kim’s work, in that Dr. Kim’s name was on the list of authors initially submitted to F&S by Dr. Lee, and was only omitted because he could not be located.'"

Gornall continued:

"Professor Kwang Soo Kim, director of the molecular neurobiology laboratory at Harvard’s Mclean Hospital and the newly recruited codirector of the CHA Stem Cell Institute, now finds himself having to defend his new employer. No fewer than three of his new colleagues at the institute including his fellow codirector, Hyung Min Chung are among the disputed authors on the paper. In February he wrote to Dr. DeCherney of Fertility and Sterility on behalf of the CHA organisation as 'a fellow research scientist with more than 23 years of research experience in the US as well as first-hand knowledge of standard practices in the scientific community in Korea,' to express regret about the incident.

"In his letter, a copy of which the CHA organisation sent to the BMJ, he suggests that 'The main issue that appears to be at the center of this controversy is the multiple publication of the paper.' But he then makes a disturbing disclosure: 'In Korea, it has been a customary practice and an accepted procedure by the scientific community to submit top-quality research outcomes concurrently (or subsequently) to internationally-recognized journals in an effort to promote and advance the work of Korean scientists, which was also the case when Dr Lee submitted her paper to Fertility and Sterility.

"'I personally have very strong objections to this practice and have been trying to convince the scientific leaders in Korea to put a stop to this. It was only recently in 2006 that this guideline was in fact revised in Korea to prohibit this practice.'

"Professor Kim’s intervention leaves little doubt about how seriously the CHA group views the potential of the incident to damage its bid to inherit Hwang’s crown: 'The reputation and credibility of our university and that of its researchers and scientists are also at stake,' Professor Kim writes. 'This is an extremely critical issue in light of the fact that I believe our institution will serve a pivotal role in restoring the severely damaged reputation and credibility of stem cell and life science research in Korea after the Hwang scandal.'"

We have queried DeCherney concerning his response to the letter from Cha's lawyers.

For previous items on the the CHA story, see "Secrecy," "Example," "CGS" and "FTCR."

Time to Give Fax Machines a Decent Burial

Fascimile transmission seems akin to the Linotype. At least to this writer, who is boggled by several recent communications that could only be received via antiquated technology. (This item, by the way, is not really about CIRM or stem cells.) Why anyone would want to use fax instead of email or other electronic transfer methods is hard to understand. It seems a waste of time and particularly a waste of physical storage space, which is undoubtedly more expensive than digital storage. Perhaps we are missing something concerning the use of fax. If so, hopefully someone can enlighten us.

Criticism: The Price for a CIRM Grant

The California stem cell agency is breaking into some of the cloistered halls of science with criticism that publicly labels one scientist "naïve" and calls another scientist's proposal potentially irrelevant.

Of course, the sting of the criticism is soothed with the balm of multimillion dollar research grants.

Reporter Carl Hall of the San Francisco Chronicle recently sliced a bit deeper than other reporters into the public summaries of the grants won by California scientists, noting that they "offer a rare glimpse into the traditionally cloistered world of scientific peer review. He quoted Arlene Chiu, director of scientific programs at CIRM, as saying,

"The NIH doesn't show any of this kind of thing going on, This is the first time you can see how people criticize one another."

Arnold Kriegstein, chief of the UC San Francisco stem cell program, was the target of a comment that he was "naïve" on some technical matters. He told Hall he was a victim of his own brevity and may have been misunderstood "in certain technical aspects." His bruises were nicely tended with a $2.5 million grant.

Alice Tarantal, a pediatrics professor at UC Davis, described the review as a "very fair process" although some reviewers questioned how relevant her model was from a clinical perspective. She received a $2.3 million grant.

The names of those criticized are only publicly released after the grants are approved, although some persons very familiar with stem cell research could identify at least some of the scientists in advance based on the nature of their work. The names of those who fail to win grants are not released.

We have written often about unwarranted secrecy in the grant process. But the public summaries are an excellent step in the right direction and CIRM should receive ample credit for providing them.

Hall should also receive credit for bringing them to a higher level of public visibility.

In another grant-related story, reporter Terri Somers of the San Diego Union-Tribune looked more closely at some of the recipients of CIRM grants, including those relatively new to the field. She described how their research is cutting across specialities with the hope of transforming the field.

One example is a $638,000 grant to UC San Diego professor Shu Chien, a medical doctor and pioneer in bioengineering. Somers wrote:"'His team will use a testing system he helped to develop so they can simultaneously look at thousands of proteins and their effects on different cells.

"'So instead of doing these tests one by one in a test tube, which could take years, we can do them all at once,' Chien said."

Salon.com Looks at Industry Opposition to SB771

The headline on Salon.com read: "Biomedical industry to California legislators: 'Don't you dare tell us what to do with your money!'"

Andrew Leonard, a California author and regular on Salon.com, continued:

"The horror! To CHI (California Healthcare Institute), SB 771 is unwarranted state intervention in their profit-making potential, an act of robbery that must be resisted with extreme prejudice."

Leonard referred to the excerpts of a CHI letter seen on the California Stem Cell Report in the "Biomedical Industry" item below.

He wrote:

"As a citizen of California who voted for the state's landmark stem cell initiative, and whose tax dollars will go toward paying off the bonds issued to pay for it, I fully support legislative efforts to ensure that some of the revenue generated by the commercialization of research paid for with my money return to the state....

"If the biomedical companies don't like it, they can just go find someone else's money to play with."

Leonard also said,

"Whatever happens, I look forward to following the twists and turns of California's ambitious attempt to bootstrap stem cell research via the reporting at the California Stem Cell Report blog. I have a particular weakness for blogs that obsessively cover every iota of news about a single, highly circumscribed topic -- they seem to regularly expose me to information that is not easily found elsewhere."

Baristas to Bioworld: More on WARF Ruling Impact

More coverage and commentary on the WARF patent ruling is filtering in today.

From Randall Osborne, west coast editor of Bioworld, comes this:

"'It's a big thing,' said Paul Lesko, patent attorney with SimmonsCooper in East Alton, Ill. 'Most times there will be at least an amendment, if the patent survives,' although the process could take years.

"'When it comes to a [final PTO action], I'd say a wholesale rejection is more common than anything else,' Lesko said, especially with patents that contain claims that are fewer in number, like WARF's.

From the Patent Baristas blog, Stephen Albainy-Jenei writes:

"I don’t think anyone should go out and throw a party just yet. The patent office grants over 90 percent of the requests for reexamination and many of those patents are issued with substantially the same claim(s) as before reexamination. WARF, a nonprofit group that acts as UW’s tech transfer office, will have a chance to prove the cells are novel. And, if the claims are ultimately rejected, it can still appeal or narrow the claims. This could take years to resolve."

Joff Wild, editor of Intellectual Asset Management magazine, says WARF is now on the "defensive" and adds:

"Although WARF changed its licensing policy earlier this year, 20 years worth of income from its stem cell portfolio still potentially represents a colossal amount of money."

California's Biomedical Industry Lays Out Opposition to SB771

The chief lobbying group for the California biomedical industry Tuesday detailed its strong opposition to legislation that seeks to guarantee that California reaps an economic and health-related return on its $3 billion stem cell research investment.

David Gollaher, president of the 250-member organization, said the bill, SB771, will "create significant disincentives for firms to commercialize inventions funded with CIRM money. And without company participation, basic stem cell science cannot be developed into treatments for patients."

CHI's opposition was laid out in a five-page letter to Sen. Sheila Kuehl, D-Santa Monica, co-author of the bill and chair of the Senate Health Committee. It was also sent to Senate Republican leader George Runner of Antelope Valley, co-author of the measure, and all Republican members of the California Senate.

CHI is also unhappy with CIRM's own provisions for sharing the wealth on any inventions that stem from CIRM-funded research.

CHI's letter said:

"Because commercialization is essential for the development and production of new medicines that can be used by Californians and others, CHI believes that the basic goal of intellectual property policies should be to minimize barriers to transfer technologies from basic research laboratories to the private sector for commercialization into products. Moreover, while we strongly support policies to improve patients’ access to advanced medicine, we maintain that IP policies and regulations are not the way to improve access and cost.

"Investment in biotechnology is inherently very risky. Any aspect of a technology transfer contract that increases risk, particularly by adding an element of uncertainty, makes it less attractive to potential partners and investors and thus reduces the prospects for successful commercial collaboration.

"We believe the intellectual property policies in your measure would reverse the improvements thoughtfully considered and accepted by the ICOC (CIRM's Oversight Committee) during several public meetings. SB 771 would impose more stringent revenue sharing and pricing and access provisions than those finally adopted by the ICOC.

"Additionally, we believe that codifying IP provisions in statute will deny the ICOC the flexibility it may need to amend its IP policies in the event they prove to be unworkable. As you know, the CIRM has just begun to issue research grants and it will likely be a number of years before any discoveries from this research moves to the commercialization stage. Thus, the ICOC may not know for some time if the IP policies it has adopted are effective and will need flexibility to change its IP policies if the situation warrants."

The letter concluded by saying that CHI questions

"...the appropriateness of commercial companies being forced to pay royalties, beyond what they negotiate with basic research institutions. If additional payments like this are required, along with the revenue sharing, pricing and access clauses mentioned above, they will only serve as an additional disincentive to commercial participation in CIRM-funded research."

The CIRM Oversight Committee is scheduled to discuss SB771 on April 10. Three members of that group are also directors of CHI. They are Ted Love, CEO of Nuvelo; Richard Murphy, head of the Salk Institute, and Philip Pizzo, dean of the Stanford School of Medicine.

The Senate Health Committee takes up the legislation on April 11. We have asked Kuehl's office if it would like to comment on the CHI letter.

Fresh Comments

John M. Simpson has posted a comment on the "secrecy" item from Monday. Lawrence Ebert has posted a comment on the "NY Times" item, also from Monday.

Ruling Endangers $3.2 Million WARF Cash Stream

One commentator said that the WARF patent ruling "marks a welcome turning point in the battle against the unnecessary and unproductive privatization of mankind's quest to understand the natural universe."

Another called it a "victory for the patent law freedom fighters."

But in the Wisconsin State Journal, reporter David Wahlberg, said it could cut off the spigot that has poured $3.2 million into the Wisconsin Alumni Research Foundation. He was the only reporter to identify the cash flow from the ESC patents.

It was all part of the news coverage today of ruling by the federal Patent Office concerning WARF's ESC patents. (For coverage of the issue on Monday see the earlier items below.)

Wahlberg quoted Dan Ravicher, executive director of the Public Patent Foundation, as saying,

"Although these patents aren't dead, they have been diagnosed with severe cancer."

Ravicher's group and the Foundation for Taxpayer and Consumers Rights were the two organizations that challenged the WARF patents, which remain in place pending an appeal by WARF.

Walhberg said,

"The patents have brought in at least $3.2 million to WARF and could net much more money before they expire in 2015. Companies wanting to study the cells must buy licenses costing $75,000 to $400,000, though since January, WARF waives the fees if the research is conducted at universities or by nonprofit groups."

Merrill Goozner, writing on the Huffington Post, called the patent ruling a "turning point." Goozner, who is with the Center for Science in the Public Interest, continued,

"Discovering human embryonic stem cells, which have been around since man first walked the earth, is more like Isaac Newton discovering gravity than the Wright Brothers building the first airplane.

"The Public Patent Foundation and the California Foundation for Taxpayer and Consumer Rights, which challenged the Thompson patents, have provided a valuable service for the entire science community. Unfortunately, the PTO ruling relied on the traditional tenets of patent law. The examiners, upon reexamination, claimed the patent was obvious based on previous papers that had appeared in the literature. Obviousness and previous publication are cause for rejecting a patent application.

"WARF's top officer immediately restaked their claim on those grounds.

Goozner continued:

"Basic science that may ultimately lead to useful products should be free and open to all who would build those useful products. Its inventors should not be allowed to become toll collectors on the road to innovation. Hopefully, the PTO decision yesterday is the first step on the road back to a reasonable standard for establishing where basic science ends and commercial invention begins."

Andrew Leonard, writing on Salon.com, declared that the "patent law freedom fighters" had won.

Terri Somers of the San Diego Union Tribune quoted Cathryn Campbell, an intellectual-property lawyer with Needle and Rosenberg, as saying it is significant that the patent office went beyond the cases cited by the challengers and found two more examples of prior science in the area.

Steve Johnson of the San Jose Mercury News touched on the impact on Geron, a California stem cell company that helped finance the research. Johnson wrote:

"If the patents are rejected permanently, Geron wouldn't have to pay license fees to use the technology, said David Greenwood, Geron's executive vice president and chief financial officer. And while Geron would lose its exclusive right to the technology, the company has other stem-cell licensing rights and patents that give it an edge on other stem-cell companies, Greenwood said."

Geron's stock dropped 3.64 percent on Tuesday, closing at $7.15 in above average volume. The stock has ranged from $5.66 to $10.00 over the last 12 months.

Missing from today's coverage was the Wall Street Journal, which only carried a blog item based on the New York Times story (see the item below from Monday on that.)

Here are links to other stories: Associated Press, Ipbiz blog, Los Angeles Times, Milwaukee Journal Sentinel, Sacramento Bee. The San Francisco Chronicle carried the AP story.

Geron Statement on WARF Patent Rulings

Here is the full text of Geron's statement on the ruling on the WARF ESC patents.

"Geron Corporation (Nasdaq: GERN) supports the position of the Wisconsin Alumni Research Foundation (WARF) that  U.S. patents  covering Dr. James Thomson’s pioneering work with human embryonic stem cells were properly granted. Thomson’s success in isolating human embryonic stem cells is recognized by the scientific community as a significant breakthrough, and the scope of the patents granted to WARF is commensurate with that achievement.  Three patents issued to WARF based on Dr. Thomson’s research are being reexamined by the U.S. Patent and Trademark Office (USPTO).

"It is routine for the USPTO to grant patent re-examination requests.  Furthermore, it is common for the USPTO to issue preliminary rulings that reject patent claims, only for the USPTO to terminate re-examinations and uphold patent claims in later stages of the review and appeals process.

"As the world leader in the development of human embryonic stem cell-based therapeutics, Geron holds a broad portfolio of intellectual property rights.  This portfolio includes the WARF patents in re-examination, additional WARF patents that are not subject to the re-examination proceedings and patents exclusively licensed from the University of California and the University of Oxford.  In addition, Geron’s portfolio includes patents and patent applications filed by Geron to cover technologies developed internally by Geron scientists for the production and differentiation of embryonic stem cells."

NY Times On WARF Patent Case

The New York Times has posted a piece by Andrew Pollack on the rulings in the WARF ESC patent case.

The story generally covers much of what you have read on the California Stem Cell Report, but also says:

"It is now much more likely, however, that the patents will be narrowed or revoked, and some scientists or companies might become more confident in undertaking research that would infringe the patents."

Pollack continues:

"Companies are charged $75,000 to $400,000, depending on their size and the terms of the license.

"The Geron Corporation, which financed some of Dr. Thomson’s research, has exclusive commercial rights to heart, nerve and pancreatic cells derived from the human embryonic stem cells. So if the patents remain in effect, any company wanting to market a treatment for heart attacks, Parkinson’s disease or diabetes using human embryonic stem cells would eventually have to come to terms with Geron. "

WARF's Gulbrandsen Holds Federal Patent Advisory Post

The managing director of WARF currently sits on an advisory committee to the federal Patent and Trademark Office, which will hear WARF's appeal of an unfavorable ruling on WARF ESC patent claims.

Carl Gulbrandsen was appointed to the Patent Public Advisory Committee by the secretary of commerce in February 2005.

John M. Simpson, stem cell project director for Foundation for Taxpayer and Consumers Rights, said that Gulbrandsen should resign from the advisory committee. Simpson's group challenged the patent claims.

We have queried WARF and the Patent Office for comment.

(Editor's note: One reader suggested the first sentence of this item is ambiguous. To be perfectly clear, the committee in question is an advisory body. The patent office is the agency directly involved in the patent dispute.)

Links to WARF ESC Patent Rulings

The Foundation for Taxpayer and Consumer Rights has posted the rulings of the Patent Office on the WARF ESC patents. Here are the links:

www.consumerwatchdog.org/resources/780rejected.pdf

www.consumerwatchdog.org/resources/806rejected.pdf

www.consumerwatchdog.org/resources/913rejected.pdf

WARF Staying the Course on ESC Patents

WARF said today that it is confident that its ESC patents will ultimately be upheld despite rejection of its claims Friday by the U.S. Patent Office.

The organization released the following press release:

"With regard to the preliminary denial of the existing claims, WARF Managing Director Carl E. Gulbrandsen issued the following statement:

"'WARF has absolute confidence in the appropriateness and legitimacy of these patents. It is inconceivable to us that Dr. Thomson’s discovery, which Science Magazine heralded as one of the greatest scientific discoveries in history, would be found to not be worthy of a patent. This discovery captured the imagination of people all over the globe from every discipline.'

Gulbrandsen pointed out that the former director of the National Institutes of Health predicted the discovery would change the face of medicine.

"'We are confident that, when all of the facts are known and the process runs its course, our patents wil be upheld,' he said.

"The PTO granted the reexamination request and issued a preliminary ruling rejecting the patent claims in question, which is not at all unusual, according to Gulbrandsen, who pointed out that the patent reexamination process provides for multiple layers of review. This first rejection, for example, gives WARF the opportunity to respond directly to the examiner, a response in which WARF will vigorously defend its patent claims. That response could persuade the examiner to sustain the patents and terminate the reexaminations. If the examiner maintains the rejection, WARF could, and most probably would, appeal the examiner’s decision to the PTO Board of Patent Appeals. And, if that body fails to sustain the patents, WARF can then appeal to the courts.

"This process can take many months, or even years. But while the review is underway, all of WARF’s patents remain in place and are legally viable."

WARF Stem Cell Patent Claims Rejected

The federal government has rejected three embryonic stem cell patent claims by the Wisconsin Alumni Research Foundation, upholding a challenge led by a California watchdog group, the Foundation for Taxpayer and Consumer Rights.

The challenge to the work done by the University of Wisconsin scientist James Thomson was upheld by the U.S. Patent and Trademark Office, the FTCR group said Monday.

John M. Simpson, stem cell project director for FTCR, said, "This is a great day for scientific research." Numerous groups and scientists had complained that the WARF patents placed roadblocks in the way of research.

WARF had no immediate comment. The organization has two months to respond to the ruling, which came more quickly than expected. Geron, a California company that has an exclusive license involving the patents, had no immediate comment. The California stem cell agency also had no comment on the case, a position it has maintained since it began.

The decision said,

"It would have been obvious to one skilled in the art at the time the invention was filed to the method of isolating ES cells from primates and maintaining the isolated ES cells on feeder cells for periods longer than one year. A person skilled in the art would have been motivated to isolate primate (human) ES cells, and maintained in undifferentiated state for prolonged periods, since ES cells are pluripotential and can be used in gene therapy."

The Public Patent Foundation was a partner in the challenge to the WARF patents. Dan Ravicher, executive director of that organization, said,

“Now that the PTO has ruled, WARF should simply drop all its claims."

Jeanne Loring, a stem cell researcher at the Burnham Institute in California, had filed documents in support of the patent challenge. She was once quoted as saying,

"WARF's stance that Thomson's work is worthy of patents, 'is like saying that just because heating in water works for cooking a chicken egg, it's novel to consider using heating in water to cook a duck egg.'"

Loring also wrote last spring in Science magazine that Geron funded the patented HES cell derivations and "received an exclusive license for broad therapeutic use in the United States of HES cell–derived cardiac, nervous system, and pancreatic cells."

More background on the WARF patents can be found by searching on "WARF patents" in the "search blog" window in the upper left hand corner of this page.

Secrecy and California's $100 Million in Stem Cell Grants

More than two years ago, a legal expert on California's "sunshine" laws said the state's $3 billion stem cell agency should open its doors wider and fulfill its then fledgling promise to meet the highest standards of openness and transparency.

Terry Francke, general counsel for Californians Aware, zeroed in on the manner in which CIRM decides which scientists are selected to receive millions of dollars in public funds. Francke said the task should be performed mostly in public, which would provide "vital insurance" that public needs are met and no mischief is afoot.

CIRM's Oversight Committee rejected that position, and today we are beginning to see the impact. It comes in the form of a lack of vital information about how the agency has handed out more than $100 million in research grants. It involves the failure of the agency to keep minutes or transcripts of key sessions of its grant review committee, compliance with the state's constitutional guarantee of the "people's right to access" governmental information and the role of the chair of the agency during one closed-door grant review.

The case in point is a $2.6 million grant to CHA RMI, a 15-month-old nonprofit subsidiary of CHA Health Systems of Korea. Like 28 other applications, the Los Angeles-based RMI went through review and approval earlier this year. But the grant has now risen to higher visibility because of what one watchdog group called "troubling questions" about plagiarism allegations concerning Kwang-Yul Cha, president of CHA RMI's parent company, and alleged ethical breaches involving the medical director of RMI's allied fertility clinic.

How did the CHA RMI application come to be in the top tier of grants approved for funding, setting it up for no-questions-asked approval by CIRM's 29-member Oversight Committee? What can the public learn about the process that does not involve the closely protected scientific details of the grants or proprietary information? For example, can the public learn what the key vote was on the CHA RMI application during the initial review? Can the public learn if other votes were taken that would have affected CHA RMI's possible approval? Can the public determine whether the organization's reputation was discussed by grant reviewers, much less what was said?

Using CHA RMI as an example, here is a look at the grant review process, what the public is allowed to know and what is kept secret by the California stem cell agency.

In January during a closed-door session, the CIRM grant review committee (14 out-of-state scientists and seven patient advocate members of the CIRM's Oversight Committee, including its chair) placed the CHA RMI grant in the top tier of those to be funded. The names of all applicants, however, were secret at the time. On Feb. 18, the Los Angeles Times carried its story about the plagiarism allegations and other issues involving Cha, the top executive of the parent company of CHA RMI. On Feb. 23, the Los Angeles Times carried another story about the CHA fertility clinic. Neither story specifically mentioned CHA RMI. On March 15, CIRM's Oversight Committee, approved the CHA RMI grant with little discussion as part of a block of other top-ranked grants. Under CIRM rules, Oversight Committee members (with the exception those who served on the grant review panel) did not know the name of any of the recipient organizations before they voted. So it was impossible for most Oversight Committee members to connect the CHA RMI application with either of the Times' stories. After the vote, the names of the winners were released by CIRM. The names of the other applicants remain secret. Public linkage of the Times reports and the CHA RMI grant came only on March 17 on the Bodyhack blog on Wired.com and on March 21 in the California Stem Cell Report. Other media followed the March 21 report.

What the public knew about all the grants prior to its approval can be seen on the CIRM web site, which carried, in advance of the Oversight Committee meeting, a summary of each application and reviewers' assessment of its strengths and weaknesses – minus names of the applicant. That summary and assessment surpasses the information disclosed about grant applications by the National Institutes of Health, the federal agency for making most scientific research grants, and other grant-making organizations with the exception of Connecticut's stem cell research effort, according to CIRM.

What is not known publicly is also significant. Here are questions that remain unanswered.

-- Did California stem cell Chairman Robert Klein, who met Cha in October 2005 in Korea on trip financed by a Korean trade organization, take part in the discussion of the CHA RMI application during its review by the grant committee?

-- What was the vote by the grant review committee on the CHA RMI application, a vote that is required by the grant review committee's bylaws?

-- Were other votes taken that would affect the placement of CHA RMI grant in the top tier? Such as a vote on the cutoff score for placing applications in the top tier? The CHA RMI application received a scientific score of 77, nine points above cutoff line and 18 below the top score.

-- Did any grant reviewers raise questions about CHA RMI's reputation or that of its allied organizations?

CIRM would not disclose the vote on the CHA RMI application. The agency declined to disclose whether the CHA RMI grant was considered separately or together with other grants. CIRM declined to disclose whether there was a vote on the cutoff score for tier one grants. No transcripts, minutes or audio tapes exist from the meeting, although notes were taken by CIRM staff to prepare the public summaries of the grants.

Dale Carlson, chief communications officer for CIRM, said at one point said via email, "We think the public summaries of the discussion speak for themselves." He later added, "From the ranked list of Comprehensive Grant applications...anyone can see that it's clear the CHA application made it into Tier I on the strength of its scientific score."

Responding to a general question about the review process, Stuart Orkin, Harvard medical professor and chair of the grant review committee, said, "I think it is a very fair and transparent process for selection of the best and most promising grants for the CIRM."

Regarding the lack of transcript and minutes, Carlson said, "We keep very careful records on the (grant reviewers) who vote and have conflicts. They are retained and available for review by auditors."

CIRM declined to disclose whether Klein took part in the discussion of the CHA RMI application, but noted that he sits ex officio on the committee and does not have a vote.

Klein was in Korea in October 2005. Carlson said that he met with Cha at that time but offered no further details. In economic disclosure statements filed with the state, Klein, a multimillionaire who takes no salary for his post with CIRM, listed a gift from CHA Health Systems on Oct. 16, 2005, valued at $100. It was described as a "stone stamp/seal." Klein also received a decorative box valued at $175 from the Korean International Trade Association during the trip, which was paid for by the same association. The flight was valued at $4,170 and his one-night hotel stay at $509, according to Klein's filings. He reported that he spoke at a symposium and three research hospitals. Klein received no honorarium or other fee for his speeches, according to state filings. His trip was made to join in the announcement of an international stem cell consortium being organized by then stem-cell superstar Woo Suk Hwang, according to published reports. The consortium later collapsed when Hwang confessed to stem cell research fraud and was indicted on embezzlement and bioethics law violations.

Carlson said,

"Klein's probably met hundreds of scientists in California and elsewhere in the past couple of years, including many with applications considered by the ICOC. That's probably true for most, if not all, members of the
ICOC. They are, after all, a pretty high-profile group with a lot of public interaction. What's your point? Meeting someone does not constitute a conflict of interest."

We asked Carlson whether CIRM, prior to the working group review of grants, gathered any information on grant applicants and their institutions? His response:

"In the interest of effectively managing our scarce resources, the rigorous due diligence conducted on each applicant investigator and/or institution is undertaken after the ICOC votes to approve grants for funding. The administrative review is an intensive process, as I'm sure you can imagine. With 300 applications for SEED and Comp grants, for example, and an expectation that the ICOC would approve just 55, it wouldn't be prudent to examine all 300 to see if they met the requirements of the RFAs. Better to focus our limited time on those that actually have a chance of a grant award."

We also asked Carlson whether, during the grant review process, there was any discussion of CHA's reputation or that of its parent or allied organizations? Or of the reputations of the CHA scientists or management or scientists and other personnel associated with CHA's allied organizations? He replied,

"The public summary indicates that there was discussion of the capabilities of the principal investigator and his collaborators. The focus is on scientific merit. Exclusively, scientific merit.

"I think it's worth noting that none of the stories referenced by (watchdog groups and others) had surfaced at the time the application was submitted or reviewed."

As for the agency's position on withholding information on votes and other non-scientific information involved in the grant reviews, Prop. 71 states: "All records of the working groups SUBMITTED (our capitalization) as part of the working groups’ recommendations to the ICOC for approval shall be subject to the Public Records Act." That phrasing apparently serves as the legal foundation for the institute's position that it may withhold any information that is not submitted as part of the grant review's formal recommendations. The language is part of state law as opposed to the State Constitution.

During the same election in which Prop. 71 was passed, California voters also adopted Prop. 59, amending the state Constitution to guarantee the public's right to government records. The constitutional amendment states: "A statute, court rule, or other authority, including those in effect on the effective date of this subdivision, shall be broadly construed if it furthers the people's right of access, and narrowly construed if it limits the right of access." The measure was approved by 89 percent of voters, far exceeding the 59 percent for Prop. 71. That is significant because courts have used approval rates in some cases to determine precedence in case of conflicting measures.

Does the voter-approved Constitutional provision mean that CIRM must open its processes? That question is not likely to be completely answered short of litigation that would probably proceed to the State Supreme Court. Other possibilities include a legislative change in Prop. 71, which requires an overwhelming 70 percent vote in both houses, or an attorney general opinion. Those can be requested by legislators or state agencies and carry considerable legal weight. CIRM can also change its policies on its own volition.

Kuehl On the Big Lie, Aging Porsches and Politics

California State Senator Sheila Kuehl, author of the latest legislation to intervene in California stem cell matters, talks about her politics and personal life in a lengthy interview in California Conversations magazine in Sacramento.

Writer Aaron Read opens the article by commenting that Kuehl, a Santa Monica Democrat, has "a Cagneyesque, spit-in-the-eyes willingness to engage in consequential discussion on how we are allowed to live our lives–a real world concept that public policy im­pacts Californians in elemental ways."

The interview is remarkably revealing. Few politicians, businessmen or women or stem cell scientists would be so open. Here are sample quotes from Kuehl, who once played Zelda on the Dobie Gillis television series, concerning the more pedestrian matters of politics and policy:

Why did she seek a legislative seat:

"I was working with a small group of people framing a domestic violence law in California. And, because I was a law professor, I was asked to come up and testify at the Capitol, where I had only been once as a teenage tourist. And I would sit and wait while committees rambled on and watch everybody and after a while I thought, 'I could do this.'"

Her major legislative accomplishments?

"There are three I’m most proud of. One is the protection of students in school against harassment or discrimination or violence on the basis of real or perceived sexual orientation. It protects all the kids, even if they’re not gay and others just think they are. The second is nurse-to-patient staffing ratios, which I’m very proud of. And the third is paid family leave."

On political lies:

"I think the right-wing philosophy of starving the beast is so detrimental to 90% of the people. They’ve got the people fooled that somehow if rich people do okay, then every­body does okay. That’s the big lie."

She tells readers that she still has her 1964 red Porsche convertible, a model we have admired over the years. She attended and worked at UCLA for a number of years before getting a law degree at Harvard. But she does not mention UCLA basketball (tonight the Bruins play Florida in the final four). She discusses her love life, but she does not mention stem cells or the California Institute of Regenerative Medicine. Perhaps because the interview was conducted some time ago. Magazines usually have lengthy prepublication schedules. Or perhaps because the topic was not as interesting as other matters. (Hard to believe, I know.)

Los Angeles Times blogger Robert Salladay reports that the magazine is produced by some folks at Aaron Read & Associates, a Sacramento lobbying firm that represents the California Association of Professional Scientists, the California Medical Association, AT&T, PG&E, among many others. Read, head of the firm, conducted the interview with Kuehl.

CIRM Lab Grant Programs Coming Up in April

The agenda for the April 10 meeting of the Oversight Committee of the California stem cell agency is now available on the institute's web site, well ahead of the actual date of the meeting.

It is still quite shy of background material but that is likely to fill in as the date of the meeting at the Sacramento Convention Center approaches.

Topics to be considered include SB771 (see item below), an update on the search for a person to replace CIRM President Zach Hall, who is leaving in three months, and discussion of procedures for considering the upcoming round of laboratory grants. A goodly number of the members of the Oversight Committee represent institutions that are likely to be applying for the grants.

Also on the agenda is a "presentation of survey description and concept plan for large facilities," meaning grants for buildings and laboratories. CIRM has about $300 million allotted for various building projects.

SB771: CHI Takes 'Not-So-Subtle Jab'

California's biomedical industry has already begun its lobbying campaign against legislation to guarantee the state shares in the potential bounty from products developed from its $3 billion stem cell research effort.

Writing on Law.com, reporter Cheryl Miller said members of the California Healthcare Institute were pounding the hallways in the Capitol a few days ago armed with a "not-so-subtle jab" at SB771, which does not face its first legislative test until April 11.

Miller said that their talking points included the following:

"Recent legislative proposals that focus on revenue-sharing thresholds and pricing and access requirements place direct financial return ahead of the far greater benefit to all Californians (and people everywhere) from the development of innovative technologies. Such provisions are sure to discourage the private investment needed to bring state-funded science to market."

Miller also quoted the author of the bill, Sen. Sheila Kuehl, D-Santa Monica, as saying,

"I expect that there will be people who are not going to praise this bill. But they're going to have to find a way to critique it without saying we don't want the state to get any money."

CHI members have a number of legislative fish to fry so it is not clear how widely their stem cell message was distributed.

Clarification

The "Eggs" item below makes a reference to CIRM regulations concerning reimbursement of expenses for egg donors involving "lost wages" vs. direct expenses. Some persons contend that lost wages should not be reimbursed, arguing that creates a disparity between well-paid and less well-paid women. In California, CIRM regulations include reimbursement for lost wages. So does the proposed policy for ESC research that is not connected to CIRM funding, which is regulated by another state law.

Eggs and Absurd Inconsistencies

Writing in the New England Journal of Medicine, a Harvard business professor says the "politics of egg donation" have obscured the real issues concerning the market for human oocytes.

Debora Spar discusses the scene nationally and internationally, using the case of woman she calls "Anna Behrens," who Spar says is not a real person. Spar wrote in the March 29 edition of the NEJM:

"The United States, by contrast, maintains the absurd inconsistency illustrated by the case of Anna Behrens: $20,000 for an egg used for reproduction; nothing for the same egg used for stem-cell research. Such a policy would make sense only if we deemed assisted reproduction socially more valuable than research. But this argument is not being made and perhaps could not logically stand, given that the alternative to assisted reproduction would often be adoption. Instead, opponents of egg selling tend to refer to the fears of commodification and the risks to donors — all of which, if valid, apply equally to the reproductive and research uses of eggs.

"What we need, therefore, is a fresh debate on egg donation and a new set of policies. We need to consider the health risks and ways of identifying and mitigating them. We need to ensure that all potential donors are fully informed of these risks and fully protected against them. We need to make clear that the benefits of egg donation, for reproductive or research purposes, are complicated, and that few of these benefits will ever flow directly to the donor. At the moment, though, the politics of egg donation have blinded us to these real issues. We have not thought deeply about what makes sense for science, for women, and for society. Instead, we are only fighting about the price."

Spar, author of "The Baby Business: How Markets are Changing the Future of Birth," does not discuss in her NEJM article the possible growth of a black market for human eggs, which seems certain to arise if eggs have real monetary value and there is a shortage.

As far as California is concerned, Spar reports that researchers using state funds are prohibited from compensating egg donors for anything beyond direct expenses.

The actual language of the CIRM regulations is slightly different. It says that "permissible expenses" are "necessary and reasonable costs directly incurred as a result of donation or participation in research activities. Permissible expenses may include but are not limited to costs associated with travel, housing, child care, medical care, health insurance and actual lost wages."

NEJM has also posted an interview with Spar and Emily Galpern of the Center for Genetics and Society in Oakland on the subject of egg donations.

Comments

John M. Simpson has posted a response on the "Sacbee and Cha" item. Den has posted a commento on "Fairness and Cha."

Fresh Comments

We have two anonymous comments today. One is on the question of the costs included in CIRM grants(see the "CIRM Grant Oversight" item). The other is a comment on the "FTCR and Sacbee" item.

Governmental Camels and Stem Cell Swag

Is it good business for a drug company to charge – let's say $47,000 for a 10-month cancer treatment – or will such pricing hurt the industry long term?

But forget the business issue. Is it good public policy to allow a company to charge those fees – labelled egregious by some? Especially if the treatment was partially financed with public funds?

Questions such as those stand close to the center of the debate over the intellectual property that will be produced by $3 billion in research funded by California's stem cell agency. Intellectual property policy is the vehicle because that's where CIRM sets its requirements for royalties and revenue-sharing connected to its research. That is also where it sets its requirements for affordable access to stem cell cures that it helps to finance.

The $47,000 treatment cost is not hypothetical. It involves Genentech and its drug, Avastin, which was developed with the help of some clinical trials that were subsidized by the federal government.

On March 15, the Wall Street Journal examined the case of Avastin in a front page story. Reporter Geeta Anand began her piece like this:

"Two years ago, Steven Harr urged Genentech Inc. to lower the price of a key drug that was helping buoy its stock price. He was an unlikely messenger because of his job: a Wall Street research analyst whose investing clients crave profits.

"In a conference room with 30 senior managers from the biotech company, Dr. Harr said he feared patients wouldn't be able to afford the drug Avastin, which costs about $47,000 for the average 10-month course of treatment for colorectal cancer. He warned that Congress 'will get involved when its constituents can't get drugs.' Genentech later capped Avastin's price, acknowledging the influence of Dr. Harr, among many others."

Harr also pointed out an interesting bit of blowback from oncologists detected during a survey he conducted. According to the WSJ story,

"He says most physicians surveyed weren't prescribing the drug in breast and lung cancer for fear of not being reimbursed. Avastin and Erbitux are given to patients intravenously in doctors' offices. Doctors buy the drug ahead of time, infuse it into patients and then wait to be reimbursed. Any refusal by insurers to reimburse would leave doctors thousands of dollars in debt."

Harr, an analyst with Morgan Stanley, sees high prices as bad for business.

"He says soaring cancer-drug prices, generating fat profit margins, aren't sustainable."

That is a message that is sometimes hard for business executives to accept. They rail at governmental fiddling with their enterprises. They froth at bumbling regulators. But at the same time, many seek government assistance for research, favorable regulation, tax benefits or laws restricting their competitors. Contrary to popular belief, the vast majority of legislative activity nationally and in California does not involve such things as gay marriage or sex offenders or drivers licenses. It involves "filthy lucre" and crass commerce. Most of it is instigated by those advocates of free markets – the top executives of the finest companies in America. It is why business spends tens of millions of dollars and more annually lobbying lawmakers.

Folks such as those at the California Healthcare Institute, which represents the state biomedical industry, want the grants from CIRM. But they don't want to pay the piper that provides the basis for the plenititude. Or they don't want to pay as much as some watchdog groups and legislators would like. But like any other investor, the state wants its slice and does not want to be treated a whole lot differently than, say, the venture capitalists at Kleiner Perkins Caufield & Byers, if they had laid out a $3 billion investment. When you invite governmental camels into your tent, it is sometimes hard to get them to leave.

Biotech, however, has valid points concerning writing what are basically the terms of a business deal into state law and regulation. Both are difficult to change and can impair development of cures if they are riddled with restrictive minutia. Likewise, biotech firms must see a strong likelihood of making money. If they don't, the cures will not be developed unless the government is ready to pay for the whole process, which is not likely to happen in our lifetime.

Obviously, the state of California is not a venture capital firm. Perhaps not so obviously, the stem cell industry is not the most shining example of private markets at work. The finest risk-takers in America(venture capitalists) run for the back exits, for the most part, when they see a stem cell executive come through the front door. The result is that with embryonic stem cell research in California, we have an amalgam of business, government and science. That means that compromises must be made by all the players. If one of the partners gets too greedy, the whole endeavor – the California stem cell experiment -- can fail.

Finally we should note that a group actively engaged with CIRM on IP issues was mentioned in the WSJ article but not by name. That organization is the Foundation for Taxpayer and Consumer Rights of Santa Monica, Ca. Here is what the WSJ wrote about FTCR.

"In the spring of last year, a taxpayer group in California began publicly condemning Genentech for charging too much for Avastin, noting that the federal government's National Institutes of Health had subsidized some clinical trials of the drug. Not long after, Genentech said it was considering capping the price of Avastin."

FTCR on Sacbee and Cha

John M. Simpson, stem cell project director of the Foundation for Taxpayer and Consumers Rights, sent along the following comment on today's Sacramento Bee editorial on CHA RMI.

"What the Foundation for Taxpayer and Consumer Rights has said is that there are enough red flags associated with CHA's leadership and corporate affiliations as to warrant a thorough vetting of an application from its researcher.

"Precisely because we raised our concerns, CIRM's staff is now on the record in public in response as promising a thorough review of all applications -- including this one -- before any checks are issued.

"We did our job. The editorial board of the Sacramento Bee did its job. Now it's up to CIRM to do its job."

See the item below on the Bee editorial.