Gone Sailing

The California Stem Cell Report will go dark for a couple of weeks or so as we make our way across the bounding main to Mexico. As many of you know, yours truly lives on a sailboat (15 years come June 1) that shuttles about the Pacific south of the American border. We have spent nearly two years in Panama and are now working our way back to Mexico where the chiles are hot and the frijoles “rico.” Look for fresh coverage either late this month or early April.  

Cyberspace Makeover at California Stem Cell Agency

California's $3 billion stem cell agency has performed a well-done makeover on its most important public face – its web site, which is chock-a-block full of useful information for researchers and the unwashed alike.

At cirm.ca.gov, one can find the very words of its directors as they wrestle with everything from grant approvals to conflicts of interest. Scientists can be seen telling the story of their accomplishments. Money can be followed, and summaries of reviews of grant applications read, both those approved and those that did not pass muster.

The web site of the California Institute of Regenerative Medicine (the formal name of the agency) is the place where the stem cell program really meets the public. News stories are important, but infrequent. Day to day, however, thousands of interested persons seek out information that the folks at CIRM HQ, just a long throw from the San Francisco Giants ballpark, bring to cyberspace.

Each month, said Amy Adams, major domo of the web site, 15,000 to 17,000 “unique viewers” visit online. She told the California Stem Cell Report in an email,

“We're up about 25 percent year over year in unique viewers to the site. A lot of that growth comes from search, and the rest is from traffic driven through our blog and Facebook.” 

The numbers are not huge compared to those chalked up by major media sites. But they are significant given that there are only a few thousand people worldwide who are deeply and regularly interested in stem cell research. Many more, however, are stimulated to look into the subject from time to time, either because of news stories, personal, disease-related concerns or simple interest in cutting edge science. Engaging those readers, who can spread the CIRM story, and winning their approval is critical for the agency as it faces the need to raise more millions as it money runs out in the next few years.

CIRM has mounted much information online over its short life. So much that good tools are needed to navigate the site. Decisions about what should go on the home page are critical. With the makeover, the agency now has a long-needed, home-page link to its meetings , especially those of its governing board, which are the single most important events at the agency.

The redesign is crisp and clean. The new, white background makes it easier to read and is comfortable for readers long conditioned to the black-on-white print of the books, newspapers and magazines. The video image on the home page is larger, which helps attract viewers. The site has long had a carload of videos, some of which contain powerful and emotional stories from patients.

Adams used CIRM staffers to test the new features. She reported,

“I've had people inside CIRM (who have been beta testing this site) tell me that they are finding content they'd never seen before because the site is so much easier to navigate.”

Adams and the CIRM communications team also have pulled together important information on each grant on a single page, including progress reports. You can find a sample here on a $1 million grant to Stanford's Helen Blau.

Adams said,

 “Now people can not only read about what our grantees are hoping to accomplish, they can read about what has actually been accomplished with our funding.”

Adams said another new feature is downloadable spread sheets of information that can be manipulated by readers offline. She said,

“Most places on the site where you see tables, you can now download those tables to Excel. You'll notice the small Excel icon at the lower left of the table. This feature has long been available for the searchable grants table. Now you'll see it on all the tables of review reports (see here for example http://www.cirm.ca.gov/application-reviews/10877) on the disease fact sheets (see here http://www.cirm.ca.gov/about-stem-cells/alzheimers-disease-fact-sheet) and other places throughout the site. This is part of an effort to make our funding records more publicly available.”

CIRM's search engine for its web site still needs work. A search using the term “CIRM budget 2012-2013” did not produce a budget document on the first two pages of the search results. A search on the term “Proposition 71,” the ballot initiative that created CIRM, did not provide a direct link to its text on the first two pages of search results.

Also missing from the web site, as far as I can tell, is a list of the persons who appointed the past and present board members as well as the dates of the board members' terms of office. The biographies on some of the 29 governing board members come up short. In the case of Susan Bryant, her bio does not mention that she is interim executive vice chancellor and provost at UC Irvine. Links also could be added to board members statements of economic interest. A list of CIRM staff members (only slightly more than 50 persons) and their titles could be added.

As for CIRM's count of visitors, CIRM uses Google Analytics tools. Adams said,

“A unique visitor is Google's definition (it's one of the metrics they provide). It's a visit from a unique IP (internet protocol) address. So, if you visit our site multiple times from one IP address during a day, you count as a single unique visitor. (Editor's note: It is possible to have more than one visitor from the same IP address.)

“We get ~23,000-25,000 visits per month, or ~16,000-18,000 unique visitors. Page views are on the order of 65,000 a month.”

Our take: The redesign of the web site is a worthy effort and enhances CIRM's relationships with all those who come looking for information. The agency is to be commended and should continue its work to improve the site and its connections with the public.

California Stem Cell Directors to Finalize IOM Response Next Week

Directors of the California stem cell agency will meet March 19 in Burlingame to complete action on their response to blue-ribbon recommendations for sweeping changes at the eight-year-old research enterprise.

CIRM Chairman J.T. Thomas last week told the San Diego U-T editorial board that he regarded approval as “largely ministerial.”

Thomas has been visiting newspaper editorial boards around the state, touting his plan, which was initially approved by the board in January. The main focus has been on its provisions dealing with conflicts of interest, which would have 13 of the 29 governing board members voluntarily remove themselves from voting on any grant applications. The 13 are linked to recipient institutions. Two other board members linked to recipient institutions also sit on the board.

About 90 percent of the $1.8 billion that has been awarded by the CIRM board has gone to institutions linked to past and present members of the board.

In December, the Institute of Medicine cited major problems with conflicts at the stem cell agency. It recommended creation of a new, independent majority on the board, which would mean that some members would lose their seats. The IOM report also recommended a host of additional changes that have become eclipsed by the controversy about conflicts, which were built into the board by Proposition 71, the ballot measure that created it in 2004.

An analysis in January by the California Stem Cell Report of the IOM report, which CIRM commissioned at a cost of $700,000, showed that agency's response fell far short of what the IOM proposed to improve the agency's performance.

Also on the agenda for the March 19 is approval of applications in a $30 million effort by the agency involving reprogrammed adult stem cells. The agency said the goal of the initiative is “to generate and ensure the availability of high quality disease-specific hiPSC resources for disease modeling, target discovery and drug discovery and development for prevalent, genetically complex diseases.”  

San Diego Newspaper Hails Stem Cell Agency and IOM Response

The $3 billion California stem cell agency hit it big in San Diego today, finally scoring an editorial that said “arguably” the agency's largess has made the state “the world leader in medical research.”

The San Diego U-T, the largest circulation newspaper in the area, said the big headline about the eight-year-old agency is “the potential for transformative medical breakthroughs.”

The editorial noted that the agency has long been criticized in connection with conflicts of interest. About 90 percent of the $1.8 billion the agency has awarded has gone to institutions linked to current and past members of its board of directors.

But the agency “is finally taking the criticism seriously,” the newspaper said. It cited proposals that would, if approved later this month, have 13 members of the agency's governing board voluntarily abstain from voting on any grants that come before the board. Twenty-nine persons sit on the board. The thirteen are connected to recipient institutions. Two other board members are linked to recipient institutions.

The stem cell business is no small matter in San Diego, which is one of California's hotbeds of biotech and stem cell research. The stem cell agency has awarded about $338 million to San Diego area institutions and businesses. Four executives from San Diego area institutions sit on the CIRM board.

The newspaper's editorial said,

“There remains a residue of cynicism about CIRM. Critics say the agency board did the minimum necessary to avoid an intervention by the Legislature – and also acted to buff the agency’s image should it seek more bond funding from California voters before its present funding runs out in 2017, as is now projected.

“These views may have some merit. But on balance, we think the California Institute for Regenerative Medicine has – at long last – responded properly to the fair criticism it faced. Instead of being exasperated by CIRM, more people should be excited about the great work it is doing.”

The editorial followed a meeting involving the editorial board of the newspaper, CIRM Chairman Jonathan Thomas and Larry Godlstein, director of the UC San Diego stem cell program. The meeting was part of a CIRM campaign to generate newspaper support for the agency's response to sweeping recommendations from a blue-ribbon study by the Institute of Medicine. The San Diego editorial is the most effusive so far.

The newspaper's biotech reporter, Bradley Fikes, sat in on the meeting and Saturday posted video excerpts from the discussion, including a brief written summary of the content of each clip.

Public Banned from 'Best Stem Cell Meeting in the World'

“The best stem cell meeting in the world” is underway today in San Francisco – conducted at taxpayer expense – but the public is barred from attending.

More than 500 persons are at the meeting at an undisclosed location, including some representatives of biotech firms. And the meeting is even being written about on the internet by a blogger. But the $3 billion California stem cell agency says the public is not allowed in because some of the information is “proprietary.”

CIRM President Alan Trounson addressed the meeting earlier this week and declared it was “the best stem cell meeting in the world,” according to UC Davis researcher Paul Knoepfler, who is reporting from the session on his blog.

The attendees consist almost entirely of the recipients of taxpayer-funded grants given by the stem cell agency  although a number of businesses have been brought in.. CIRM, which is paying for the gathering,  says of the annual sessions,

 “The purpose of meeting is to bring together investigators funded by CIRM, to highlight their research, and encourage scientific exchange and collaboration.”

Kevin McCormack, spokesman for the agency, today said the public was barred from the meeting, which ends tomorrow, because “so many presentations/talks (are) using proprietary information.”

That rationale is nothing new in the world of science. But there is no chance of maintaining secrecy about anything that is truly proprietary when hundreds of people have access to it in this sort of forum. No penalties exist for disclosure, plus the whole point of the session is to share information.

Yesterday we wrote briefly about the importance of transparency and openness in government, and make no mistake about it, the stem cell agency is a government operation. We doubt that anything egregious is underway at the session, but closing it to the public is a reminder about where the agency's priorities lie.  

Good News, Bad News and the California Stem Cell Agency

A few weeks ago an anonymous reader admonished the California Stem Cell Report to be more positive about the $3 billion agency and its efforts to develop the cures that its backers promised California voters more than eight years ago.

The comment was thoughtful and pointed out that “almost all the time” the agency “has done the right thing.” The reader made the remarks in the context of continuing coverage of the Institute of Medicine (IOM) report that found there were major flaws in CIRM's operations. (The reader's comment can be found here at the end of the post.)

Given the reader's remarks, it seems a good time to review the operating principles and biases of the California Stem Cell Report.

Bias No. 1: Openness and transparency come first in any government operation. They are fundamental to the integrity of all government enterprises. Bias No. 2: The California stem cell agency is generally doing a good job at funding stem cell research. We generally favor all manner of stem cell research. 

Regarding our operating principles, the goal is report news and information about the agency along with analysis and explanation. One key to understanding what this blog does is to understand what news is. News by definition is almost always “bad” as opposed to “good.” News deals with the exceptional. It is not news that millions of drivers commute to work safely each day on California freeways. It is news when one is killed in a traffic accident.

The California Stem Cell Report also tries to fill information voids. We understand that the stem cell agency believes certain information is not in their best interests to disclose. Such is always the case with both private and public organizations. However, it is generally in the public interest to see more information rather less, particularly information that an organization would rather not see become public.

Analysis and explanation of what the stem cell agency does is rare in the California media and even less seen nationally or internationally. This blog focuses primarily on the public policy aspects of the agency – not the science. The agency is an unprecedented experiment that brings together big science, big government, big academia, big business, religion, morality, ethics, life and death in single enterprise – one that operates outside the normal constraints of state agencies. No governor can cut CIRM's budget. Nor can the legislature. Even tiny changes in Proposition 71, which created CIRM, require either another vote of the people or the super, super-majority vote of both houses of the legislature and the signature of the governor. All of this is the result of the initiative process – a well-intended tool that has been abused and that has also created enormous problems for the state of California that go well beyond the stem cell agency.

Then there is the funding of the agency, which basically lives off the state's credit card. All the money that goes for grants is borrowed and roughly doubles the actual expense to taxpayers.

Since January 2005, we have posted 3,452 items on the stem cell agency because we believe the California Institute for Regenerative Medicine (CIRM) is an important enterprise – one that deserves more attention that it receives in the mainstream media. Our readership includes persons at the NIH, the National Academy of Sciences, most of the major stem cell research centers in California, academic institutions in the Great Britain, Canada, Norway, Germany, Russia, China, Australia, Singapore and Korea – not to mention the agency itself and scientific journals.

We do not attempt to replicate what the California stem cell agency itself does, which is to post online a prodigious amount of positive stories and good news about the agency. To do so would serve no useful public purpose and would simply be repetitive. That said, there is room to acknowledge the work that the agency does, particularly the staff, but also the board. We try to point that out from time to time.

The California Stem Cell Report also welcomes and encourages comments, anonymous and otherwise. Directors and executives of the agency have a standing invitation to comment at length and have their remarks published verbatim, something almost never seen in the mainstream media.

Finally, given the questions raised by the Institute of Medicine about disclosure of potential conflicts of interests, the author of this blog and his immediate family have no financial interests in any biotech or stem cell companies, other than those that may be held by large mutual funds. We have no relatives working in the field. We do have the potential personal conflicts, cited generally by the IOM in connection with some CIRM board members, involving relatives who have afflictions that could be possibly be treated with stem cell therapies in the distant future.   

LA Times: Stem Cell Agency Conflict-of-Interest Response Only a Bandage

The Los Angeles Times yesterday modestly praised the $3 billion California stem cell agency for taking some limited steps to deal with its longstanding conflict of interest issues.

But the newspaper, which has the largest circulation in the state, said that was more was needed if the agency plans to have a life after 2017, when funds for new awards run out.

The Times editorial said,

“After years of resisting all criticisms of its operations, the California Institute for Regenerative Medicine is finally listening — a little.“

The editorial continued,

“Yet the agency isn't exactly embracing an ethical overhaul. It's doing just enough to address the criticisms without triggering any oversight from the Legislature. The modifications are more a bandage than a cure. Like a bandage, they will probably do, but only for a limited time.”

The board plans to have 13 board members with ties to recipient institutions voluntarily refrain from voting on any grants that come before the board, not just the ones to their institutions.

The Times said December's blue-ribbon report from the Institute of Medicine identified the make-up of the board as the “single biggest problem” at the agency. The editorial cited figures prepared by the California Stem Cell Report that show that about 90 percent of the $1.8 billion that the board has awarded has gone to institutions linked to current or past members of the board. Fifteen out of the 29 current board members have ties to recipient institutions.

The editorial concluded,

“If the stem cell institute is just a temporary agency that will last until its public funding runs out — it plans to give its last grants with existing funds in 2017 — its planned reforms will probably be enough. But if the institute wants to be a permanent part of the research landscape — and possibly ask for more public funding — voluntary recusals are an inadequate patch. The agency's leaders should admit that the original setup was flawed and seek a true fix. “

Reader Says Open Grant Reviews to Public

An anonymous reader this afternoon filed a comment on the “Prieto on Disclosure" item. Here is an excerpt from the comment from the reader, who has obviously been following the stem cell agency for some years,

“Confidential peer review is just an excuse for secrecy. Any CIRM observer has seen that scientists are more than willing to discuss and argue about their grants before the ICOC (stem cell board) if they think that will get them funded.”

You can read the entire comment by clicking on the word “comment” at the end of the Prieto item.   

CIRM Director Prieto on Disclosure of Reviewer Financial Interests

A member of the governing board of the $3 billion California stem cell agency is weighing in on an item on the California Stem Cell Report that called for public disclosure of the financial interests of the scientific reviewers, who make 98 percent of the decisions on awards by the agency.

Francisco Prieto, a Sacramento physician and a patient advocate member of the board, said in an email:

“ It seems to me there's a bit of 'damned if we do and damned if we don't' here. If the ICOC (the agency governing board) decides to listen to some of the members of the public who come to our meetings and overrule a recommendation of the Grants Working Group(GWG), we're slammed for letting emotion trump science, or bowing to special interests. If we just accept the rankings of the GWG and approve all their recommendations, we're criticized for not being truly independent.  I think we don't do it often (for good reason) but should and do retain the right to look at other factors besides those our scientific reviewers do, and make our own decisions about funding. We are ultimately responsible, not the scientific reviewers. 

“As for the issue of their disclosure of personal conflicts of interest, from what I've read of the NIH processes, ours are no less strict. The NIH requires that reviewers disclose any conflicts to their institutions which I believe must disclose them to the NIH, but I have not seen anything requiring them to disclose all their personal financial & other interests publicly, as we (ICOC members) have to.  When we were assembling our group of reviewers initially, the fear was that many of the best scientists would turn us down if we required them to make the kind of personal disclosures we have to. I don't know how many we might actually lose if that were the case, but as you know we do require them to disclose to CIRM, and they have to leave the room when any application for which they have a conflict is discussed.”

Our take: Prieto is right about the board being perched on the horns of a dilemma, which has a lot to do with Proposition 71, which created the agency, and American scientific traditions, which place an extraordinary value on the “integrity” of the review process. In this case, integrity refers to adherence to reviewers' scientific judgments.

Proposition 71 placed the legal authority for grant approvals in the hands of the CIRM board, which has overridden decisions by reviewers in only 2 percent of the cases since 2005. However, that was enough, with at least one high profile case coupled with public appeals, to cause the Institute of Medicine to raise concerns about the integrity of the CIRM grant review process. Traditionally, peer reviewers are deemed to be the most capable of making the scientific decisions about grant applications, rather than a board appointed by University of California chancellors and elected state officials.

Yet, if the board concedes the decisions to the grant reviewers, state law is likely to require public disclosure of their financial interests, a move that the board has opposed for years. Former CIRM Chairman Robert Klein repeatedly advised the board during its public grant approval processes that reviewers' actions were only ”recommendations” and that the board was actually making the decisions. However, it has long been apparent that the reviewers were making the de facto decisions. A CIRM memo in January confirmed that, producing the 98 percent figure.

The issues involving disclosure by reviewers, integrity of peer reviews, the language of Proposition 71 and state law are difficult and may, in some cases, be at odds.

However, it makes little difference what the NIH is doing. It is a much different organization and has had a history of conflict of interest problems that it has been trying to work through.

The trend in the academic and scientific research community has been towards more public disclosure rather than less because of many well-documented instances of problems. What is at stake is the public's faith in scientific research and the integrity of public institutions.

Our thanks to Prieto for his comments on this important subject.  

California Stem Cell Agency: Comparing the Critiques

State Controller John Chiang has posted a useful, side-by-side comparison of critiques of the $3 billion California stem cell agency, including the Institute of Medicine(IOM) study, along with the responses from the agency.

Chiang, the state's top fiscal officer, has additionally posted the initial remarks Jan. 23 by CIRM Chairman Jonathan Thomas before the stem cell agency governing board on his plan to deal with the sweeping recommendations of the IOM.

Regardless of one's opinion of the board's response to the IOM, Thomas adroitly handled the discussion and vote, not a small accomplishment given the size of the board (29 members) and the legal restrictions involving public meetings. Under state law, Thomas could not lobby significant numbers of the board in advance of the meeting. He was restricted to engineering the approval in a public session, which can easily take on a life of its own given the unwieldy size of the board and the necessity for public comment.

As for the documents posted by Chiang, he is chairman of the Citizens Financial Accountability and Oversight Committee, the only state body specifically charged with oversight of the agency and its board. The web site for the committee is the only location on the Internet where Thomas' prepared remarks and the comparison can be found.

Chiang's comparison chart includes not only the IOM study, but last year's performance audit and the Little Hoover Commission study in 2009. Missing, however, is the state auditor's report in 2007 and its recommendation that the agency seek an attorney general's opinion on whether scientific grant reviewers must file a public financial disclosure form.

Here are links to the various documents: Thomas' prepared comments, Power Point chart used by Thomas, comparison chart of various studies and the transcript of the Jan. 23 meeting during which the governing board approved its response.

California Stem Cell Agency Bonds On Sale in March

Early next month, the state of California will sell $2.7 billion in bonds, a tiny fraction of which will go towards the California stem cell agency.

It is all part of an arrangement that currently involves short-term borrowing as well to keep the cash pipeline at CIRM properly filled.

To refresh some of you, the agency subsists off money that the state borrows (bonds) instead of going to the legislature annually for financial support. While that avoids competing against school children, the poor, the University of California, state colleges, parks, highways and other interests seeking state funding, it also means that the cost of a $20 million grant is something closer to $40 million because of the interest expense.

The California Stem Cell Report last week asked the state treasurer's office about the bond sale March 12-13 and what it means for the stem cell agency. Here is what Tom Dresslar, spokesman for the treasurer, replied in an email.

“CIRM’s funding needs now are met via the issuance of commercial paper (CP).  They’re authorized a certain amount of CP periodically.  Then we work with them on a regular basis to issue the commercial paper on an as-needed basis.  Last fall, they were authorized $160 million of CP.  We will issue the first $27 million under that authorization (this) week.  This spring, CIRM is scheduled to receive another $100 million authorization. The Department of Finance , consulting with CIRM officials, determined the $100 million would be needed to meet CIRM’s funding requirements through the end of 2013.

“Now, here’s where it gets a little complicated.  The state pays down the CP with bond proceeds.  The March ....bond sale includes $60 million of stem cell bonds.  Those proceeds won’t provide new money for CIRM, but will pay down the CP proceeds CIRM already has used.”

Proposition 71, which created the stem cell agency in 2004, authorized bond sales for stem cell research for only 10 years. CIRM's financial timekeepers say the clock started running when the first bonds were sold. The upshot is that the agency will run out of money for new grants in less than four years.

City of Hope Exec Will Leave California Stem Cell Agency Board

Michael Friedman
City of Hope photo

The governing board of the $3 billion California stem cell agency will lose another one of its veteran members this year – Michael Friedman, the CEO of the City of Hope in the Los Angeles area.

He will join Claire Pomeroy in leaving the board. Pomeroy is resigning as vice chancellor of Human Health Services at UC Davis this spring to become president of the Lasker Foundation in New York.. Friedman is retiring at the end of this year.

Both have been on the CIRM board since its first meeting in December 2004. Pomeroy was appointed by the UC Davis chancellor. Friedman was appointed by the state treasurer.

No names have surfaced concerning likely successors. However, the UC Davis chancellor is required by law to appoint an executive officer from the campus. The new dean at the UCD medical school would seem to be the most likely candidate.

To fill Friedman's seat, Treasurer Bill Lockyer must appoint an executive officer from a California research institute. The tradition on the board has been for particular institutes to hold particular seats on the board. The major exception is the Salk Institute, which lost a seat on the board a few years back.

Both UC Davis and the City of Hope have benefited enormously from CIRM largess. UC Davis has received $131 million and the City of Hope $51 million. Although Friedman and Pomeroy have not been allowed to vote on grants to their institutions, their presence and the presence on the board of other executives from beneficiary institutions has triggered calls for sweeping changes at the agency.

A blue-ribbon report by the Institute of Medicine said “far too many” board members are linked to institutions that receive money from CIRM. The institute recommended that a new majority of independent members be created on the board.

According to compilations by the California Stem Cell Report, about 90 percent of the $1.8 billion the board has awarded has gone to institutions with ties to past and present board members. Fifteen of the 29 members of the board, which has no independent members along the lines suggested by the IOM, are linked to recipient institutions.

The agency has $700 million remaining before money for new awards runs out in less than four years.  

Monitoring the Cash and IP at the California Stem Cell Agency

The $3 billion California stem cell agency appears unlikely to make any changes in who gets the cash from any commercial products that its research grants help finance despite recommendations from the Institute of Medicine(IOM).

The subject will come up next Wednesday during a meeting of the intellectual property subcommittee of the governing board of the stem cell agency. Intellectual property (IP) simply determines ownership rights and the share of any revenue from therapies that result from research.

CIRM staff has prepared a briefing paper with recommendations for next week's meeting, which has teleconference locations in La Jolla, Los Angeles, two in Irvine along with the main site in San Francisco.

The document summarized two key IOM recommendations in this fashion:

“Because CIRM is a new institution without a track record to reassure stakeholders, and because its finite funding timeline means as yet unknown agencies will be enforcing these policies years down the road, CIRM should “propose regulations that specify who will have the power and authority to assert and enforce in the future rights retained by the state” in CIRM IP, specifically referring to march-in rights, access plans and revenue sharing....

“Second, as other sources of funding become more prevalent, the agency should “reconsider whether its goal of developing cures would be better served by harmonizing CIRM’s IP policies wherever possible with the more familiar policies of the BayhDole Act.”

Here are the CIRM staff recommendations.

“CIRM staff has engaged in preliminary discussions several years ago with other agencies regarding future enforcement of CIRM’s regulations and agreements. Staff proposes to restart those discussions and return to the Subcommittee (or the Board) with a formal proposal to address future enforcement of CIRM’s IP regulations.”

“In light of the IOM’s own recognition that it may be premature to assess whether CIRM’s regulations will act as a deterrence to future investment, the fact that a number of CIRM’s regulations have been codified in statutes and CIRM’s positive progress in its industry engagement efforts to date, although quite early, CIRM staff proposes to continue to monitor this area and not to pursue any changes at this time.”

The director's subcommittee is unlikely to diverge significantly from the staff proposal, which was dated Feb. 14 but not posted on the CIRM website until Feb. 20.   

UC Davis stem cell scientist Paul Knoepfler is a man of many parts. Not only does he thrash around in petri dishes, but he also dabbles in graphics. In this case, a cartoon about grant reviews and conflicts of interest. Above is the the first frame of the cartoon. You can see the whole story on his blog at this location.

Half-full, Half-empty Editorial on California Stem Cell Agency

The California stem cell agency's editorial road show paid off a bit again this week with a mildly approving editorial in the Oakland Tribune.

The Feb.18 piece said that the presence of Jonathan Thomas, a Los Angeles bond financier, as chairman of the $3 billion agency has improved things, compared to the reign of Bob Klein, who “built a protective shield” around the agency's governing board and prevented action to deal with obvious conflict-of-interest problems.

The newspaper also said that “to some extent” the agency has brought “cutting edge” scientists to the state and helped boost the stem cell field.

That was the half-full side of the editorial. The half-empty side included the headline.

“California must get its stem cell house in order”

The editorial continued:

“...{T)he agency must prove that it understands how to properly handle the public's money. …. If the stem cell agency can establish a record as a good steward of public dollars to finance brilliant science, it can continue to play a useful role in stimulating and guiding research to bring the potential cures from stem cell research to fruition.

“If it cannot do that, it will be just another expensive Tyrannosaurus rex.”

Thomas and company are knocking on editorial doors around the state in hopes of building support for the board's modest – some might say inadequate – response to recommendations for sweeping changes at the agency.  

Time For Public Disclosure of Financial Interests of Stem Cell Agency Reviewers

Should the scientists who evaluate and score the applications for $3 billion in taxpayer funds be required to publicly disclose their financial interests?

No, says the California stem cell agency, despite concerns by the state auditor and the state's Fair Political Practices Commission (FPPC) that date back at least six years. The agency says that its governing board makes the decisions on the applications – not the grant reviewers – and that the members of the board fully disclose their economic interests.

However, last month the agency produced a document that sheds new light on the issue. The document confirms that the board rubber-stamps virtually all the reviewers' decisions, going along with their actions 98 percent of the time. The board exercised independent judgment on 28 out of 1,355 applications.

Why is this important? Here is what the state auditor said in 2007,

“(T)he FPPC believes that, under state regulations, working group members (including grant reviewers) may act as decision makers if they make substantive recommendations that are, over an extended period, regularly approved without significant amendment or modification by the committee. Thus, as decision makers, working group members would need to be subject to the conflict-of-interest code. This would mean that working groups would be subject not only to the (public) financial disclosure requirements of the Political Reform Act but also to the prohibition against a member participating in a government decision in which that member has a disqualifying financial interest and may be subject to the penalties that may be imposed on individuals who violate that act.”

The auditor recommended that the stem cell agency seek an attorney general's opinion on the matter, a recommendation the agency agency summarily dismissed seven months later..

Then interim CIRM President Richard Murphy, a former member of the agency's board and former president of the Salk Institute, replied to the auditor:

"We have given careful consideration to your recommendation and have decided it is not appropriate to implement at this time. In almost three years of operation and approval of four rounds of grants, the recommendations of the CIRM working groups have never been routinely and/or regularly adopted by the ICOC. Until the time that such a pattern is detected, the question you suggest we raise with the attorney general is entirely hypothetical, and is therefore not appropriate for submission. We will, however, continue to monitor approvals for such a pattern and will reconsider our decision if one emerges."

In the four rounds mentioned in Murphy's response, 100 percent of reviewer decisions were rubber-stamped by the board. In the other two rounds, the percentage was 95 and 96 percent.

Currently, scientific grant reviewers at the stem cell agency, all of whom are from out-of-state, disclose financial and professional conflicts of interest in private to selected CIRM officials. (See policy here.) From time to time, grant reviewers are excused from evaluating specific applications.

The CIRM governing board has resisted requiring public disclosure of the interests of reviewers. The subject has come up several times, but board members have been concerned about losing reviewers who would not be pleased about disclosing their financial interests.  Nonetheless, disclosure of interests among researchers is becoming routine in scientific research articles. Many universities, including Stanford, also require public disclosure of financial interests of their researchers. Stanford says,

“No matter what the circumstances -- if an independent observer might reasonably question whether the individual's professional actions or decisions are determined by considerations of personal financial gain, the relationship should be disclosed to the public during presentations, in publications, teaching or other public venues.”

The latest version of CIRM's conflict of interest rules are under review by the FPPC. They do not include any changes in public disclosure for grant reviewers. In view of the new information that confirms that reviewers are making 98 percent of the decisions on who gets the taxpayers' dollars, it would seem that it is long past due for public disclosure of both financial and professional interests of reviewers. Indeed, given the nature of scientific research and the tiny size of the stem cell community, disclosure of professional interests may be more important than financial disclosures.

As Francis S. Collins, head of the NIH, said concerning his organization's own strengthening of disclosure requirements,

"The public trust in what we do is just essential, and we cannot afford to take any chances with the integrity of the research process."

Here is the CIRM document concerning reviewers' decisions and governing board action. The table has not been posted on the CIRM website, but it was prepared for last month's meeting dealing with the Institute of Medicine's recommendations for sweeping changes at the agency, especially related to conflicts of interest.

CIRM Board's Record on Reviewer Grant Decisions by

San Jose Newspaper Lauds CIRM Chairman Thomas

The California stem cell agency got some good news this week. The San Jose Mercury News ran an editorial yesterday that was headlined,

“State stem cell agency is taking Institutes of Medicine advice”

The 306-word editorial said CIRM Chairman Jonathan Thomas is a refreshing change from Robert Klein, the first chairman of the $3 billion enterprise. The brief editorial said Thomas recognizes that the eight-year-old agency "has to mature." It said Thomas was trying to improve transparency and accountability. The last paragraph declared, “If the stem cell agency can establish a record as a good steward of public dollars to finance brilliant science, it can continue to play a useful role in stimulating and guiding research to bring the potential cures from stem cell research to fruition.”

Reader Wants More Positive Slant From California Stem Cell Report

An anonymous reader has posted a thoughtful comment admonishing this writer to be more positive about the $3 billion California stem cell agency.

We recommend the comment to the readers of this blog. The remarks can be found by clicking on the word comment at the end of the “no improper influence” item. We will have more to say on the subject in the next few days.

No Improper Influence: CIRM Defends 'No Actual Conflicts' Claim

Earlier this month the California Stem Cell Report  published an item that said:

“In the wake of recent considerable criticism concerning conflicts of interest at the $3 billion California stem cell agency, its leaders have taken to saying 'no actual conflicts' have been found at the agency.

“That assertion is simply not true.”

We asked the stem cell agency if it would like to respond and said that its response would be carried verbatim. The agency's comments are below. Our take on the response follows the CIRM comments, which were authored by Kevin McCormack, the agency's senior director for public communications and patient advocate outreach.

In David Jensen’s recent blog about the stem cell agency he claims to “debunk” claims that there have been no actual conflicts in CIRM’s funding decisions saying “the agency has a long history of problems involving conflicts of interest, 'actual' and otherwise.” In fact, in the cases cited by Mr. Jensen, show 'otherwise' is the appropriate word here because as we’ll show CIRM’s conflict procedures worked and the funding decisions were not affected by any improper influence.

Let’s take it case by case, looking at each instance of a “conflict” cited by Mr. Jensen.

John Reed

In 2007, John Reed, a member of the stem cell agency’s Governing Board, contacted staff in his capacity as the president of the Burnham Institute after the Board approved a SEED grant award to a Burnham investigator. Dr. Reed did not participate in the Board’s decision to approve the award and played no role in that decision. All he did was send a letter to CIRM staff after the Board meeting to provide factual information in response to technical questions raised by CIRM staff concerning the investigator’s eligibility for an award. Those questions ultimately led staff to reject the grant. Because the Board had already made the decision to award the grant, it did not occur to Dr. Reed that the conflict rules would prevent him from contacting staff to provide relevant information. And why would it? The decision was made so there was nothing to influence. After CIRM staff received Dr. Reed’s letter, they informed Dr. Reed that he must refrain from participating in any way in CIRM's consideration of the Burnham grant. In addition, CIRM staff did not consider the letter in conducting their administrative review of the Burnham grant and their determination that the investigator was not eligible did not change. The FPPC determined that, although Dr. Reed’s conduct raised ethical concerns, he had not violated conflict of interest laws because he attempted to influence a decision that had already been made. Furthermore, Dr. Reed’s conduct did not affect a CIRM funding decision because the grant was rejected by CIRM staff.

New Faculty Awards

When a candidate applies for a CIRM New Faculty Award it is standard practice for them to include a letter of support from the institution where they hope to be working. In December 2007, during a review of applications for New Faculty Awards, CIRM staff discovered that ten applications were accompanied by letters of institutional support signed by members of the Board. This was due to a miscommunication by staff, a poorly drafted memo to Board members leading them to think it was OK to sign the letters of institutional support. The error was discovered before the Board considered any of the applications. CIRM staff determined that the letters could be perceived to create a conflict of interest and so, to avoid even the appearance of a conflict, CIRM staff disqualified the ten applications. As a result, the applications were not presented to the Board for its consideration, thereby avoiding any potential for a conflict of interest in a funding decision.

John Sladek

In 2011, while preparing the public summary for Basic Biology III applications, CIRM staff discovered that Dr. John Sladek was one of several co-authors on scientific publications with a researcher who was listed as a consultant on a CIRM grant application. This is a technical violation of the Grants Working Group (“GWG”) conflict policy, which prohibits a member of the GWG from participating in the review of an application if the member has co-authored papers with a salaried investigator listed on a CIRM application within a three year window. It should be noted, however, that Dr. Sladek’s participation in the review of the application would not have constituted a conflict of interest under state conflict of interest laws because Dr. Sladek did not have a financial interest in the application. In addition, the amount of funding involved – approximately $3,000 of salary per year for three years, less than one percent of the total award – was not material, and Dr. Sladek did not stand to receive any financial benefit from the application. Finally, Dr. Sladek’s participation in the review did not affect the outcome because the application was not recommended, or approved, for funding.

The three instances cited by Mr. Jensen share two common features. First, CIRM staff identified the potential for a conflict before any funding decision was made. Second, CIRM’s funding decisions were not affected by any improper influence.

Ted Love

Mr. Jensen also cites the service of Dr. Ted Love, a member of the Board who volunteered his time to assist CIRM in offering his scientific and medical expertise, as evidence of a conflict of interest. Although Mr. Jensen insinuates that Dr. Love’s service constituted a conflict of interest, he does not cite any facts, except Dr. Love’s “deep connections to the biomedical industry.” But the fact that Dr. Love has experience in the biotech industry does not constitute a conflict of interest, and as a member of the Board and as a volunteer to CIRM, Dr. Love abided by CIRM’s conflict of interest policies.

In the past Mr. Jensen has criticized the stem cell agency for its lack of connections and engagement with industry. In this case he criticizes us precisely because of our connection and engagement with someone who has industry experience.

Venture Capital Firm

Mr. Jensen also suggests that a conflict of interest arose from the fact that “iPierian,Inc., whose major investors [a venture capital firm] contributed nearly $6 million to the ballot measure that created the stem cell agency, has received $7.1 million in awards from the agency.” While it is true that Proposition 71 involved a multi-million dollar campaign, the funding for the campaign came primarily from individuals who had a family member who suffered from a chronic disease or injury, including individuals associated with a venture capital firm. The firm itself did not contribute to the campaign, nor did the campaign accept contributions from biotechnology or pharmaceutical companies. Furthermore, the venture capital firm did not invest in a CIRM grantee; rather, it invested in a different company which subsequently merged with yet another company to form an entity that later applied for, and was awarded a CIRM grant.

Stem Cells, Inc.

Mr. Jensen cites CIRM’s award to Stem Cells, Inc. as another source of a conflict. In support of this claim, Mr. Jensen’s references Bob Klein’s support of the award, as well as the fact that Irv Weissman, PhD, appeared in an ad for Proposition 71 in 2004. However, neither Mr. Klein’s support for the award nor Dr. Weissman’s support for Proposition 71 constitutes a conflict of interest. First, Mr. Klein, like any member of the public, has the right to express his views to the Board. The state’s revolving door laws do not apply to a former member of the Board who, like Mr. Klein, is not compensated for making an appearance. As for Dr. Weissman’s support for Proposition 71, nothing in state law prohibits a member of the public from seeking CIRM funding even though he supported the measure during the campaign. In fact, it would be reasonable to expect that most stem cell scientists in California (and elsewhere) supported Proposition 71. Disqualifying individuals from receiving funding because they supported the law would leave few, if any, eligible applicants.

Allegation of Conflict at Board Meeting

As further evidence of an “actual conflict”, Mr. Jensen cites another instance in 2008 in which a representative of a for-profit applicant publicly complained at a Board meeting that a member of the GWG had a conflict of interest “from a business perspective.” As provided for by CIRM’s regulations, the applicant had filed an appeal, claiming that the reviewer had a conflict of interest because he had a financial relationship with another company that was not an applicant for CIRM funding. CIRM’s legal counsel reviewed the appeal and determined that there was no conflict of interest under CIRM’s policy.

Saira Ramasastry and Laurence Elias

Mr. Jensen cites two instances in which CIRM’s hired consultants in support of his claim that CIRM has “actual conflicts of interest.” In 2010, CIRM retained a partner at Life Sciences Advisory, LLC, Saira Ramasastry, to assist CIRM’s External Advisory Panel, which completed its work in December 2010. In 2012, Sangamo BioSciences, Inc., nominated Ms. Ramasastry to serve on its Board of Directors. Although Ms. Ramasastry continued to provide some consulting services to CIRM through fiscal year 2011-12, none of her work for CIRM involved Sangamo or any CIRM program in which it was involved. Ms. Ramasastry’s services on behalf of CIRM did not create any conflict of interest. The same is true of the second instance cited by Mr. Jensen. In 2010, CIRM hired Dr. Laurence Elias, a former Geron employee and an accomplished clinical development professional, to provide CIRM with technical and regulatory input to ensure that the clinical elements of an RFA were technically complete and accurate. The concept for RFA had already been approved and as such Dr. Elias was not in any position to influence the overall scope or structure, nor did he have any role in evaluating applications. CIRM staff and Dr. Elias complied with all conflict of interest requirements. Neither contract led to an “actual conflict of interest”.

Diane Winokur

Mr. Jensen’s laundry list of “conflicts” also includes a reference to the recent appointment of Diane Winokur to serve on CIRM’s Board. Mr. Jensen quotes a representative of the ALS Association who said that Ms. Winokur will be “a tremendous asset in moving the ALS research field forward through CIRM funding." Of all the insinuations made in his blog this is perhaps the cheapest shot, taking aim at a woman who has dedicated her life to fighting a deadly disease, one that claimed the lives of her two sons. Mr. Jensen knows very well that the ALS Association does not speak for Ms. Winokur or CIRM and while we expect that Ms. Winokur will bring her expertise as an advocate for people suffering from ALS to the Board, she, like all members of CIRM’s Board, represents all Californians, not just those suffering from a particular disease. Ms. Winokur’s appointment does not create a conflict of interest.

Press Releases

Finally, Mr. Jensen cites a Board debate from 2006 involving a requirement in CIRM’s intellectual property regulations regarding press releases. Under Health and Safety Code section 125290.30(g)(1)(C), the discussion of standards does not create a conflict of interest, and the Board’s debate was enriched by the participation of members who brought their expertise and experience to bear.

Mr. Jensen says that one of the reasons why the IOM did not report any instances of conflict of interest in its report is that it did not look for any conflicts of “inappropriate behavior,” But Mr. Jensen was present in the public hearing at UC Irvine in April of 2012 when the IOM panel asked Stuart Drown, Executive Director of the Little Hoover Commission that also looked into allegations of conflict of interest at CIRM, if he could cite any actual instances. Mr. Drown said he could not. Nor did Mr. Jensen offer any when it was his turn to talk.

The view from the California Stem Cell Report:

Generally speaking, CIRM's response about “actual” conflicts of interests is a reiteration of what the California Stem Cell Report carried at the time of each incident and does not add much new to the discussion of the issues. All of the agency's earlier responses could be found in the links in the “debunking” piece. Additionally the agency confuses what are clearly actual conflicts with other instances that could involve either actual or perceived conflicts, which the IOM noted can be as deadly as the real thing. However, in the most egregious cases involving Reed and later the five medical school deans, the agency would like the public to believe that these were not serious matters because the staff detected and caught the conflicts before the grants were made.

That is like saying a burglar who was caught in the act before he escaped with his booty committed no offense.

The acts were committed by members of the CIRM board, and they were violations of conflict of interest standards. In the case of the five deans, that is why the agency voided 10 applications totaling $31 million from their five institutions. If there had been no actual conflict of interest, that would not have been necessary.

As for blaming the staff for “miscommunications,” the applications that the five deans signed were quite clear and offered them the option of having another person at their institution sign the grant proposal. Other deans on the board did not sign applications in the same round. Those applications were then handled in the normal fashion. One might ask how in the world could the head of a medical school who was also serving on the CIRM board NOT recognize a conflict of interest when asked to sign a request for cash from the board on which he served?

Regarding John Reed and his conflict of interest violation, both he and then CIRM Chairman Robert Klein have acknowledged Reed's actions were wrong. Klein, an attorney who directed the writing of the 10,000-word measure that created CIRM, advised Reed to contact CIRM staff to lobby on behalf of a grant that was approved by the board but was about to be denied by staff.(See here, here and here.)

CIRM's response contends that Reed's 6 ½ page letter was nothing more than “factual” information dealing with technical matters. That is hardly the case. In fact, Reed explicitly “emphasized” (Reed's word) that failing to comply with his letter would damage the future of the stem cell agency. Denial of the grant, he said, “will surely discourage clinical researchers from participating in the CIRM mission to advance stem cell therapies.”   

Reed's action was inappropriate, and the California Fair Political Practices Commission warned Reed about his actions. The journal Nature reported,

“California’s Fair Political Practices Commission (FPCC) decided that Burnham Institute President violated conflict-of-interest rules by writing a letter to the California Institute of Regenerative Medicine appealing a decision that an affiliate of his institute was ineligible for funding.”

The California Stem Cell Report's “debunking” piece went beyond "actual" conflicts to describe other instances where conflicts emerged. Readers can go back to the original links for all the details, but the cases of StemCells, Inc., and iPierian, Inc., are worth reviewing again. Both cases involve fund-raising efforts that ran into millions of dollars for the ballot measure campaign that created CIRM. The campaign was run by Bob Klein who later became the agency's first chairman, serving for six years and becoming something of a hallowed figure in stem cell circles. One of the principal jobs of a campaign manager is to raise the millions needed to run a successful statewide election campaign in California. It is common for members of the public to believe that major campaign contributors are rewarded later for their contributions. Whether that was the case in these instances, the reader must decide for himself or herself. But the appearance is less than salubrious for an agency that claims to have never seen an actual conflict of interest as it has handed out $32,000 an hour, 24 hours a day, seven days a week during the last six years.

The facts are that about 90 percent of the $1.7 billion awarded by the CIRM board has gone to institutions tied to present and past members of its governing board. The agency, however, does work hard to be sure legal conflicts do not arise during board action on grant applications, using a voting procedure that is so convoluted that the actual vote on nearly all applications is not even announced at board meetings. Sometimes the procedure means that only a handful of governing board members can participate in debate or vote. In the case of the five medical school deans, as the board struggled to deal with the fallout in 2007, only eight of the 29 members of the board could participate in the discussion because the rest had conflicts.

As for CIRM's comments about “insinuations” and “cheap shots” by the California Stem Cell Report, we naturally differ with that characterization. The case in point involved what the chief scientist for a patient advocate group said she expected as the result of a recent appointment to the board. The scientist's remarks were offered as example of the type of expectation and entitlement that can arise when governing board members must be picked from specific constituencies, as is the case with all 29 CIRM board members.

And as for my testimony at the IOM hearing last April, here is a link to my statement, which includes a discussion of conflicts of interest.  

CIRM Board Member Prieto Critiques the IOM Stem Cell Report

Francisco Prieto, a member of the governing board of the $3 billion California stem cell agency, is expressing some additional dissatisfaction with the blue-ribbon Institute of Medicine (IOM) report for which the agency paid $700,000.

The report recommended sweeping changes at the agency, including creation of a new majority of independent members on the board. The IOM cited problems arising from the built-in conflicts of interest on the board that were created by Proposition 71, which created in the agency in 2004. Prieto's email refers to Bob Klein, who is a real estate investor and attorney. Klein oversaw the drafting of the 10,000-word ballot measure(writing much of it himself), ran its $35 million ballot campaign and became the first chairman of the agency. The qualifications for chairman were written into the proposition and seemed to uniquely apply to Klein.  Prieto is a Sacramento physician who was appointed to the board as patient advocate.

.Here is the text of Prieto's comments. His earlier comments can be found here.

“A few more words on independence, and the IOM.  I think Bob Klein drafted the proposition (and remember, all of this was spelled out there – readily available to the voters and whatever news sources they were depending on for information) deliberately to engage patient advocates. I think  he knew that those of us who have been active in disease advocacy have a passion around the issue of advancing research that someone without that background would be unlikely to have. I’m not sure exactly what the IOM had in mind when they called for more 'independent' members of the board, since they very unfortunately did not bother to interview the patient advocates on the ICOC(the governing board). I don’t know what their reason for this was, if there was one, but they only circulated a (in my view) frankly inadequate questionnaire, and interviewed a small handful of people. I think this was a major flaw in their process and gave them a very limited view of our role. It is hard for me to imagine who they might have in mind, if not people who had been involved with some existing advocacy organization. I think there are very few if any patient advocates who aren’t working with some group – the only ones I might imagine would be some independently wealthy person able to start a foundation or research institute on their own.  With all due respect to Bill Gates and the great work his foundation is doing with malaria and HIV, I have written before that I think it would be absolutely wrong and anti-democratic to create any public board or commission that only millionaires could sit on.”

An anonymous comment was also posted concerning the IOM report and conflicts of interest. It dealt briefly with the issue and difficulty of managing conflicts. The comment can be found at the end of this item.