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PROPOSITION 71

State Bets on the Promise of Stem Cell Research

November 04, 2004|Megan Garvey | Times Staff Writer

Leaders in the state's biotech industry said Wednesday that they believe the $3-billion investment will attract experts in the field to California and draw more young scientists into stem cell research -- people who are likely to be tapped by private industry down the road.

But biotech leaders were split on how quickly the new spending might spur businesses. Some said the impact could be almost immediate. Others cautioned that years could pass before new companies are spawned.

Under Proposition 71, work begins immediately to set up the agency that will govern the $3 billion in research funds.

The money will be raised through the sale of tax-exempt state bonds and will cost taxpayers an estimated $6 billion over the 30-year term of the bonds.

Before the first grants can be made, the new agency, the California Center for Regenerative Medicine, must create guidelines on ethics of the research, how the state would share in potential patents, and how any breakthroughs made using taxpayer money would be shared among scientists.

"Now that it's passed, the real work starts," said Stanford law professor Hank Greely, a specialist in bioscience issues who served as an unpaid advisor to the proposition's organizers.

The agency will launch with an immediate $3-million loan from the state treasury.

Although it will distribute an enormous amount of public money, the center will be overseen by a board, the Independent Citizen's Oversight Committee, not the Legislature. The agency also will set its own auditing and conflict-of-interest rules.

Supporters contend those provisions, extraordinary for any state agency, were necessary to shield the money from politics.

Lack of governmental controls drew continued criticism Wednesday.

"This is a really big pot of public money, and we want to assure that there are public financial returns for it," said Marcy Darnovsky, an opponent of the initiative and associate executive director of the Center for Genetics and Society in Oakland.

"There are no guarantees that taxpayers' investment will result in a financial return if treatments are developed, and there are no guarantees that the treatments Californians helped pay for would be affordable for everyone."

Darnovsky said she and others with such concerns will be closely following appointments to the oversight committee.

Under terms of the proposition, the 29 members of the board must be named within 40 days. The governor, other top state officials, lawmakers and the chancellors of five UC campuses all are allowed to make some appointments.

The ballot measure tightly restricts who can be appointed. Board members must come from specific universities and patient advocacy groups, as well as the nonprofit research institute community and private industry.

Once the board is complete, its members will select a chairperson. Bob Klein, who led the Proposition 71 campaign and contributed more than $3 million to the effort, has been mentioned as a possible candidate.

Klein, who has a background in bond financing and helped create the California Housing Financing Agency three decades ago, meets the mandatory requirements set forth in the proposition.

Joan Samuelson, founder and president of the Parkinson's Action Network, said she hoped that the same collaborative effort that helped pass the initiative would continue among the disease advocacy groups.

But she described the potential for conflict as stressful.

"Nothing great is easy," Samuelson said.

*

Times staff writers Stuart Silverstein, Denise Gellene and Veronica Torrejon contributed to this report.

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