if their products succeed. (How quickly, and with what amount of interest, are details yet to emerge.)
Mills also wants a more corporate structure for CIRM, arranged around three therapeutic areas—neurology, blood and cancer, and organ systems—plus a fourth group to oversee earlier research. There are roughly two dozen programs in each area, Mills says, “and we expect each to get bigger.”
(CIRM has funded 302 active programs in all.)
For now, Mills won’t be tapping new sources of cash from rich angels, foundations, or public bonds—although Bob Klein, who stepped down as CIRM chairman in 2011, has talked about an even bigger bond initiative if the public seems receptive.
Instead, what’s left in the pot—about $900 million—can apparently be stretched farther than expected just a year ago. Last summer, before Mills began his tenure, agency officials said CIRM’s last grant dollar would likely go out the door in 2017. Now they’re saying 2020. No extra dollars have materialized since Mills arrived. Where did the new horizon come from?
Essentially, Mills says the agency can spend about $170 million a year for the next five years more efficiently.
| Where CIRM’s Cash Has Gone* |
| Clinical development projects $589 M |
| Infrastructure $439 M |
| Education and training $424 M |
| Discovery phase projects $332 M |
| Translational phase projects $301 M |
| As of Jan. 29, 2015 (Source: CIRM) *About 5 percent does not end up with the recipient because the awardee misses milestones or declines the cash. |
With the products-above-all urgency and industry-friendly rebranding, it’s natural to think CIRM’s remaining cash will shift toward the private sector. The notion makes academics nervous, especially now that CIRM 2.0 is cutting off funds for the much loved “shared labs” program, as Jeanne Loring, director of the Scripps Research Institute’s Center for Regenerative Medicine, lamented last fall in an open letter.
But the agency just announced on Jan. 29 it will put nearly $30 million into 20 academic projects, and Mills pledges more to come.
“It would be a horrible mistake to cut off early research,” he says. But the question is not about absolutes, it’s about proportions. And he’s not ready to discuss those proportions. (He says he will present details for CIRM 2.0’s first discovery and translational grant cycles at an upcoming board meeting.)
Mills knows he has to please many constituents. There’s a message to academic researchers: We won’t abandon you. A message to industry: CIRM’s rolling reviews will allow for more capacity and less bureaucracy. And a message to taxpayers: We’ll do all this without boosting the annual $13 million administrative budget—but if that comes to pass, we’ll cut costs elsewhere—and we’ll do it without providing corporate pork. “We’re not going to fund a clinical program just to say we’re funding a clinical program,” Mills says.
But there’s no getting around CIRM has to spend a lot of money in coming years on industry-run projects that will eat an ever larger proportion of its remaining cash. Inevitably, because this is drug development, there will be high-profile examples that crash and burn and take California taxpayer money with them.
The biggest question, I’d argue, is whether the world is catching up to CIRM. At a regenerative medicine update in San Francisco last month, the new chief of the sector’s trade group—Sangamo Biosciences (NASDAQ: [[ticker:SGMO]]) CEO Ed Lanphier, whose company is a recipient of CIRM money—put up a slide that showed more than a dozen big drug companies that have partnered to bring in regenerative medicine products. Two years ago, said Lanphier, there were three to five.
Bluebird Bio (NASDAQ: [[ticker:BLUE]]) is an interesting example. In 2012, CIRM granted it $9.4 million to develop its beta-thalassemia treatment. (The Cambridge, MA-based company qualified because it planned part of its clinical trial in California.) But the company went public in 2013 and no longer needed CIRM’s money. The cash went back to CIRM.
If investors and big pharma partners are happy to help the Sangamos and Bluebirds of the world move their programs forward, perhaps CIRM should let those market forces play out.
At this point, however, when it comes to funding for-profit projects, CIRM will take heat either way. As more cash flows to industry, there will be cries of corporate welfare and conflicts and overreach (what does a government agency know about clinical development?). But if CIRM were to stick to basic research, it would take flack for leaving its mission unfulfilled.
Whether CIRM signs off in a few years or extends its life with new cash, it will ultimately be judged on getting treatments, even cures, to patients. In fact, if it produces just one cure or significant therapy to change the way we treat Alzheimer’s disease, Parkinson’s disease, diabetes, or some other costly malady, we Californians might look back one day and say those billions were dollars well spent.
