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If all politics is local, then what is happening in California may portend the future of public-finance for stem cell research nationwide. Nearly two years after California voters approved Proposition 71, a $3 billion bond measure to fund research under the administration of the California Institute of Regenerative Medicine (CIRM), the stem cell institute has been creeping rather than leaping forward while awaiting the outcome of two lawsuits challenging its constitutionality.

Oral arguments in the combined cases ended on March 2 but Alameda Superior Court Judge Bonnie Lewman Sabraw ruled on April 21 that lawsuits against the CIRM were without merit, and that the CIRM is constitutional. Attorneys for the groups challenging the CIRM told Neurology Today that they will appeal the decision by Judge Sabraw. Until the case reaches the California Supreme Court and a final ruling is made – by early 2007, the lawyers predict – CIRM cannot issue the $3 billion in bonds approved by California voters in 2004.

In April, the institute was said to be months from having to shutter its doors when it announced that it had received $14 million in private funds from charitable groups. The money permitted CIRM to fund its first grants and to keep administrative operations going while it awaits the outcome of the lawsuits.


Brought by conservative groups that support low taxes and oppose the destruction of embryos – The National Tax Limitation Committee and the California Family Bioethics Council – the lawsuits by each group reflect the views of some neurologists – a decided minority – including one who conducts non-embryonic stem cell research.

“Of course I'm for stem cell research and regenerative medicine,” said David Hess, MD, Professor and Chair of Neurology at the Medical College of Georgia, and a member of the AAN Ethics, Law, and Humanities Committee. “But I personally believe embryonic stem cell research is problematic from an ethical viewpoint.”

Dr. Hess's primary research area focuses on using bone marrow-derived stem cells to repair stroke-injured brains. At the AAN Annual Meeting in San Diego, he mounted a poster on a rat model showing that after an experimentally induced stroke in mature animals, administration of 200,000 to 400,000 human stem cells into the brains increased motor and neurological performance by 25 percent over controls during the two months of the study.


Dr. Fred H. Gage: “I work on stem cells in California, so it may seem self-serving for me to pass judgment on the idea of supporting this research. But I do think this is a promising area and one that could lead to major benefits to the state of California, both medically and economically.”

Despite his personal views on embryonic stem cells, however, Dr. Hess said he opposes the lawsuits holding up CIRM. “I do feel sorry for California scientists who applied for grants, were approved, and now they can't get the money,” he said. “I hate to see things hung up with legal challenges when the issue is moral and ethical more than anything else.”


Terry L. Thompson, Director of the Life Legal Defense Foundation, which represents the parties challenging the CIRM, said that the lawsuits do not raise any of the pro-life issues his organization supports. (The organization was behind legal efforts to keep Terri Schiavo, the brain-injured Florida woman on life support.) Rather, he told Neurology Today, the case addresses the unconstitutionality of CIRM's organization.

Specifically, the claims challenge the constitutionality of allowing individuals on CIRM's board to allocate public funds raised by the $3 billion in bonds. Because some of the board members are California university officials, the suits assert that they have a conflict of interest, because their institutions would receive some of the institute's grants.

“You can't take $3 billion dollars of taxpayers' money and give it to a committee of private citizens, or to citizens who represent other entities, and allow them to decide who gets the money,” Thompson said.

But James C. Harrison, one of the attorneys representing CIRM in the dispute, said that the institute and its board are firmly under the management and control of the state.


Dr. Clive N. Svendsen: “The institute [CIRM] is a good idea for promoting the science of stem cells and should be allowed to proceed once the legal issues have been addressed.”

“The agency has held more than 50 public meetings in its first year,” said Harrison, a partner in the California firm of Remcho, Johansen & Purcell and special counsel to CIRM. He pointed out that the institute has adopted “stringent conflict-of-interest rules; far-reaching medical, ethical, and scientific regulations to govern CIRM-funded research; and an intellectual property policy that ensures that the state will have an opportunity to share in royalties and license fees flowing from CIRM-funded research.”

He also pointed out that university officials who sit on the CIRM board recuse themselves whenever a grant from their own university is being considered.


The Process of Harvesting Embryonic Stem Cells


Proposition 71 was approved by 59 percent of California voters in November 2004. That result closely mirrored the findings of a national poll conducted in 2005 by the Genetics and Public Policy Center at the Phoebe R. Berman Bioethics Institute of Johns Hopkins University. When asked which they support more – embryonic stem cell research that might result in new medical cures or not destroying human embryos involved in that research – 61 percent of the 2,200 adults surveyed sided with research, while 37 percent said that not destroying embryos was more important.

Expected at the time of its approval to quickly become the nation's largest single funder of stem cell research, CIRM has instead been tied up in such tight knots by the lawsuits that its financial state looked perilous early this year. Although small charitable donations had kept it afloat, it was unable to award any of the first grants it had approved, and the toll of financing its legal defense was growing.

Then, on April 4, CIRM announced that six charities had agreed to purchase $14 million in Bond Anticipation Notes (BINs) to keep the institute going.

A week after receiving the interim financing, the institute awarded its first grants – $12.1 million to 16 universities and nonprofit groups that will be used to train 169 scientists.

The institute ultimately hopes to secure $50 million in interim financing while awaiting the trial outcome. “Once the litigation is resolved,” said Harrison, “the state will be able to issue the bonds to fund all of the CIRM's programs.” That is a decision that panelists at last month's all-day seminar on stem cell research at the AAN Annual Meeting hope will happen sooner rather than later.

“I work on stem cells in California, so it may seem self-serving for me to pass judgment on the idea of supporting this research,” said Fred H. Gage, PhD, Professor in the Laboratory of Genetics at the Salk Institute. “But I do think this is a promising area and one that could lead to major benefits to the state of California, both medically and economically.”

Clive N. Svendsen, PhD, Professor of Anatomy and Neurology at the University of Wisconsin Waisman Center, said that because he sits on the scientific review committee for CIRM, it would be inappropriate for him to say much about it. But, he said, “The institute is a good idea for promoting the science of stem cells and should be allowed to proceed once the legal issues have been addressed.”

Added Laurie Zoloth, PhD, Director of the Center for Bioethics, Science, and Society at the Feinberg School of Medicine of Northwestern University: “I support the basic idea of democracy, so I would prefer that citizens, who reflect directly on the issues, be trusted to vote thoughtfully.”

The all-day stem cell research seminar will be covered in greater depth in an upcoming issue of Neurology Today.


The AAN supports government funding for adult and embryonic stem cell research. The official position statement was published in Neurology (2005;164:1679–1680) and is available online at (select “stem cell research). But although the AAN officially supports embryonic stem cell research, the Chair of the AAN Ethics, Law, and Humanities committee acknowledged that some AAN members do not support that position.

“I'm sensitive to the fact that people can have differing views,” said Michael A. Williams, MD, Assistant Professor in the Departments of Neurology and Neurosurgery at Johns Hopkins University School of Medicine. “It's important for people with those different views to be heard. The fact of the matter is that people are going to come to different moral views for different reasons. They reflect the views of a real minority of members of the academy. We ought to be open and responsible to hearing those views.”

In 2004, when Sandra F. Olson, MD, then AAN President, announced the support of both AAN and the American Neurological Association for government funding of adult and embryonic stem cells, she noted, “The AAN and ANA recognize there are differing ethical opinions on the status of embryos that cannot be resolved to the satisfaction of all through medical science alone.”


Researcher Rudy Gonzalez inserts human embryonic stem cell cultures into a vile at the Burnham Institute in La Jolla, California. Nearly two years after Californians approved a bond measure supporting embryonic stem cell research in the state, lawsuits brought by conservative groups have inhibited funding efforts by the agency chosen to oversee the statewide grants program.


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  • ✓ Despite legal challenges, the California Institute of Regenerative Medicine, which administers the grants program, has begun to award grants with the help of private donors.