StemCells, Inc., Still Looking for $40 Million from California Stem Cell Agency

Remember StemCells, Inc., and the $40
million it was awarded by the California stem cell agency.

The Newark, Ca., firm, founded by
eminent Stanford researcher Irv Weissman, received an award of $20
million last July and then again in September. Nearly five months
later, however, the stem cell agency has yet to cut a check for the
company, a spokesman for the agency told the California Stem Cell
Report in response to a query.

The hang-up is the $40 million in
matching funds that the company promised the agency. The stem cell
agency has yet to be satisfied that StemCells, Inc., can actually
produce the match, although the spokesman did not offer details.

The StemCells, Inc., awards were
unusual in a number of ways. It was the first time that former CIRM
Chairman Robert Klein lobbied the CIRM governing board on behalf of a
company(see here and here). It was the first time that the governing
board approved an application that had been rejected twice by grant
reviewers. It was the first time that the board said explicitly in a
public session that it wanted proof of the matching funds as a
condition of the award.

It was the first time that a CIRM award
to a company received a careful and critical scrutiny from a major
California newspaper. Michael Hiltzik, a Pulitzer Prize-winning
business columnist and author, wrote in October in the Los Angeles
Times that the award was “redolent of cronyism.” He referred
particularly to longstanding ties between Klein and Weissman.

The CIRM board vote on the StemCells,
Inc., grant in September was 7-5, which amounted to 12 out of 29
members of the board.

In December, a blue-ribbon panel of the
Institute of Medicine (IOM) recommended that the agency tighten its
conflict of interest standards to avoid such perceptions as have been
generated by the StemCells, Inc., awards. The IOM said,