STEM CELL RESEARCH PROMISES MADE, BUT NO RESULTS.

Byline: K. Lloyd Billingsley

A year after the passage of Proposition 71, the $3 billion Stem Cell Research and Cures Initiative, there is no sign of any research, let alone cures, and the measure is literally on trial in Alameda County Superior Court.

Last month, Judge Bonnie Sabraw rejected a state request to dismiss lawsuits from opponents who charge that Proposition 71 is unconstitutional because it exists outside of state control. Judge Sabraw also lifted a stay on discovery in the case, but many of the measure's problems are already evident.

Proposition 71 was a triumph of political marketing by a man who is neither a scientist nor a medical researcher. The ballot measure, which created the California Institute for Regenerative Medicine, was the brainchild of Robert Klein II, a Bay Area real-estate millionaire.

At Stanford law school, Klein worked for a legal aid society on housing-rights cases. At age 27, the California Legislature hired him to draft bills that created the California Housing Finance Authority. Son of the former city manager of Fresno, Klein went on to become a deal-maker with experience in bond issues.

A 1984 Fresno Bee report describes how, in 1981, Klein arranged for Fresno County to issue $27.8 million in low-interest loans to companies with which he was closely associated. Some of the money was then lent, according to The Bee, ``at advantageous rates to development partnerships headed by Klein.'' In 1982, the Fresno Board of Supervisors would hire one of those partnerships, the Tomar Klein Financial Group, as a consultant on a bond issue.

Klein did not enjoy the scrutiny of his actions and said that, from then on, he would stay out of government work. He didn't, but he did learn a lesson. When he wrote Proposition 71, he made sure to keep politicians, critics and even the public at bay. The measure remains off-limits to amendment for three years. After that, legislators can only make changes if 70 percent of the state Senate and Assembly approve.

Klein also wrote the law to require that the chairman of the CIRM oversight committee have a background in advocacy of stem-cell research and experience in state government and bond issues. Sure enough, he got the job he essentially wrote for himself, becoming chairman of the Independent Citizens Oversight Committee, a 29-member board appointed by the governor and other elected officials.

Jesse Reynolds, program director of the Oakland-based Center for Genetics and Society, and a supporter of embryonic stem cell research, has said that the ``coronation'' of Klein ``may be the most overt case of cronyism and insider dealing in biomedicine yet.''

But the cronyism didn't end there. It continued with the way Klein staffed and set up CIRM. As a Sacramento Bee editorial put it, Klein ``has installed his cohorts as state employees, hired and fired consultants without consulting his fellow board members, and basked in the adulation of patient advocates who see him as their savior.''

The wording of Proposition 71 exempts from state open-meeting laws the working groups, panels of scientists and board members who recommend grants and standards. Public-interest lawyer Charles Halpern, a supporter of embryonic stem cell research, along with former U.S. Assistant Secretary of Health Philip Lee, filed a petition seeking more open meetings, tougher conflict-of-interest rules and salary caps. In March, Klein rejected every point of their petition and defended closed meetings for the working groups on the grounds that the National Institutes of Health does likewise.

That same month, state Sen. Deborah Ortiz - a Democrat who actively supported Proposition 71 - announced plans to introduce a constitutional amendment to require open meetings for CIRM and stricter rules on conflict of-interest issues. Klein fought her off with help from Lt. Gov. Cruz Bustamante and a high-powered lobbying firm.

Klein has vowed to divest himself of any biotech and pharmaceutical interests to avoid the appearance of conflict of interest. But CIRM leaders have refused to disclose the stock holdings and consulting relationships of scientists who will be recommending billions in research grants. In July, Klein and CIRM president Zach Hall argued that scientists will refuse to participate in the institute's grant review panel if forced to disclose potential conflicts.

Hall is a neuroscientist at the University of California's Keck School of Medicine and the founder of EnVivo Pharmaceuticals, a Massachusetts biotech firm. His salary as interim CIRM president is $389,004, far above the top NIH rate of $290,000. Hall styles himself as ``John the Baptist,'' preparing the way for talented researchers in search of miraculous cures.

In that cause, the ICOC can spend up to $90 million on administration over 10 years and $300 million on research facilities during the first five years. The rest is slated for research grants. But bonds can't be issued while legal action is pending.

The Life Legal Defense Foundation filed a lawsuit charging that the finances of CIRM are not subject to oversight by government officials in Sacramento. The National Tax Limitation Committee and People's Advocate are also involved in the lawsuit. With bonds on hold, Klein proposed raising $100 million from private foundations and other sources. Debt-plagued California lent $3 million to CIRM, which opened a headquarters in San Francisco and started to hand out money.

But whether its research will ever yield the sorts of miraculous cures that Proposition 71 backers promised is highly doubtful. Wesley J. Smith, a senior fellow at the Discovery Institute, sees CIRM as ``a state unto itself'' and ``a political institute, not a science institute.'' Proposition 71 backers, he says, ``hounded on us'' the notion that embryonic stem cell research was the medically most promising - even though adult stem cells have yield far better results.

``From adult stem-cell research you have trials for paralysis, heart disease. We have zero benefits from embryonic stem cell research,'' Smith says. ``Emergency rooms and trauma centers are shutting down, services being cut and current needs wanting but we are borrowing billions in pursuit of the holy grail of stem cell research.''

Voters might be disposed to undoing Proposition 71, Smith argues, when adult stem cell research becomes so successful that The New York Times reports on it without hesitation, and when the problems of Proposition 71 permeate the public consciousness. One year after the vote, that is beginning to happen.

Meanwhile, the Superior Court trial is slated for Feb. 27 and opponents are prepared to continue legal challenges beyond those proceedings. Proposition 71 may wind up as an example of how not to conduct medical research, and CIRM as another state institution that promises more than it can deliver.

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Drawing:

(color) no caption (stem cell research)

Jorge Irribarren/Staff Artist