Secrecy & conflicts

Three years ago, California voters launched the state on a $3 billion journey involving the origins of life, cutting-edge science and medicine, big business, morality, ethics, religion and politics, not to mention the hopes of millions of people suffering from diseases ranging from diabetes to cancer.

With the passage of Proposition 71 in November 2004, California is now the world's largest source of funding for human embryonic stem cell research – pumping out money this year at an expected rate of about $29,000 an hour, $258 million in all. The California Institute for Regenerative Medicine is set to surpass that figure in 2008 when it will award its largest single round of grants: $227 million for construction of stem cell labs at many of California's major universities and nonprofit research institutions, including possibly the University of California, Davis.

By many measures, the institute is a huge success. Its impact stretches well beyond state boundaries and has stimulated the growth of similar research efforts in six other states and excitement in even more. The agency has established what are widely regarded as the toughest research and ethical standards for embryonic stem cell research in the nation. It has pioneered development of revenue sharing requirements that will come into play if successful medical therapies are created.

But by other standards, including its own strategic plan, the institute doesn't measure up. The money is not flowing as fast as called for. Rosy campaign promises of cures and an economic boom still await fulfillment. Built-in conflicts of interests pervade the institute's activities. A penchant for closed-door grant reviews and secrecy screens much of the institute's most important decisions from public view. And, more than once, calls have arisen for the resignation of its chairman, Robert Klein, a man who triggers both admiration and animosity.

In following the institute since its inception, I have focused largely on how it goes about its business and connects to the public, Legislature and governor. Via the California Stem Cell Report, I have written about the institute on more than 1,300 occasions, bringing a perspective from more than three decades as a political reporter, business editor and gubernatorial press aide to Jerry Brown.

The institute represents a major departure from the usual way of doing the people's business. Such alternatives do not always win support. Just last week, voters in New Jersey dumped a $450 million stem cell research plan. In California, the institute's success or failure is certain to have a major impact on the future of embryonic stem cell research as well as development of novel ways of solving intransigent political and government problems.

The institute, however, is controlled by men and women accustomed to operating outside of the public eye with few of the restraints that even local school board members face. Many come from the culture of science, where the motto sometimes seems to be: "Trust us. We are the experts."

But given the built-in conflicts at the agency, more sunshine is needed – if only to help avoid a scandal that could set back stem cell research efforts nationally and cast a pall over this creative governmental experiment.

Ironically, the California institute owes its creation fundamentally to President Bush, who restricted the use of federal funds for embryonic stem cell studies. Without that stimulus, supporters likely would not have mounted their effort to create a state agency with unprecedented powers. The institute is all but immune to fiddling by the governor and Legislature. Its budget is guaranteed through $3 billion in state bonds, which will cost another roughly $3 billion in interest.

Initially, the institute struggled through problems more akin to a start-up in the Silicon Valley than a state bureaucracy – no phones, no office space, no payroll procedures, no salary schedule, no employees. But it is now ensconced in offices in San Francisco and has just hired a new president, an internationally recognized Australian stem cell scientist, Alan O. Trounson.

About the writer:

• David Jensen, a former editor at The Bee, has published the California Stem Cell Report at californiastemcellreport.blogspot.com for the last three years and has written extensively on issues involving the California stem cell agency.