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State Stem Cell Institute Still Conflicted

Wednesday September 7th, 2016   •   Posted by K. Lloyd Billingsley at 4:55am PDT   •  

As we noted, California’s $3 billion Stem Cell Research and Cures Act, Proposition 71, promised life-saving cures and therapies for a host of afflictions including heart disease, diabetes, Alzheimer’s and Parkinson’s. Celebrity promoters included Christopher Reeve, Michael J. Fox and Arnold Schwarzenegger. In 2004 voters approved the measure, which created the California Institute for Regenerative Medicine. Real estate tycoon Robert Klein cleverly wrote Prop. 71 to install himself as the institute’s chairman, and Klein protected CIRM from almost all legislative oversight by requiring a 70 percent supermajority of both houses to make any structural or policy changes. He awarded huge salaries to CIRM bosses such as Alan Trounson, who bagged $490,000 a year, courtesy of California taxpayers. As David Jensen of the California Stem Cell Report shows, CIRM is still paying off big time for Trounson.

The former CIRM president “received $443,500 in total compensation from the Bay Area stem cell company that appointed him to its board of directors only seven days after he left his state post.” This came courtesy of StemCells Inc., “a firm that was awarded more than $40 million in funding while Trounson headed the California Institute for Regenerative Medicine.” The company, Jensen observes, was “the only applicant ever to reach that level of success” and “one of the two $20 million awards . . . approved by the stem cell agency’s board despite being rejected twice by its grant reviewers. It is the only time that an application has been rejected twice by reviewers and then approved by the governing board.” Jensen does not explain that CIRM founder Robert Klein lobbied for the company, and that CIRM directed a full 91 percent of its research funding to institutions with representatives on its governing board. Jensen does acknowledge, however, that “conflict-of-interest allegations have dogged the agency since it was created in 2004.”

At present, by Jensen’s count, California’s $3 billion government stem-cell agency still has “about $800 million in uncommitted funds” and “expects to run out of cash for new awards in 2020 unless it finds fresh sources of funding.” With the number of promised cures and therapies still holding at zero, CIRM remains the California Institute for the Redistribution of Money.

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September 2016