The Center for Genetics and Society today called on the "Independent Citizens Oversight Committee" to immediately address three areas of particular concern about the activities of the California Institute for Regenerative Medicine:

Inadequate conflict of interest rules for members of the ICOC and the three working groups established by Proposition 71

Unjustified exemptions of the three working groups from state rules on open meetings, conflict of interest, and public reporting

Troubling overlaps and conflicts among CIRM, the California Research and Cures Coalition, the debts of the "Yes on 71" campaign, ICOC Chair Robert Klein's business operations, and his personal finances

[ read the full letter ]

Inadequate conflict of interest rules. "The spate of recent failures at NIH and FDA makes it clear that stronger limits on conflicts of interest in the biomedical field are urgently needed," said Marcy Darnovsky, CGS associate executive director. "This week's new NIH rules reaffirm the principle that those involved with conducting or overseeing publicly funded research should be held to the highest standards of accountability."

The disclosure forms filed by ICOC members during the past month reveal numerous troubling conflicts. ICOC Vice-Chair Edward Penhoet, for example, serves as a paid partner at a venture capital firm with a major biotechnology portfolio, and sits on the board of several biotechnology companies. Penhoet also holds at least $3 million in biotechnology stocks.

Troubling overlaps among CIRM, CRCC, and "Yes on 71." ICOC Chair and interim president Robert Klein was also the chair of the "Yes on 71" campaign and its largest donor. According to the Los Angeles Times, after spending $35 million, the "Yes on 71" campaign is raising funds to pay off $6.5 million of debt, at least $1 million of which is owed to Klein. "This raises the prospect of the head of a powerful state agency asking for money to reimburse his own campaign expenses from people who may desire grants from that agency," noted Jesse Reynolds, CGS program director at the Center.

After the successful passage of the proposition, which established the Institute to grant $3 billion for stem cell research, the campaign changed into the California Research and Cures Coalition, a nonprofit organization which advocates for stem cell research and has acted an interim body of staff for the Institute. Klein was initially its chair, and both organizations have operated from the offices of Klein Financial Corporation.

Unwise exemptions of the working groups from public accountability and transparency laws. Though Proposition 71 exempts the ICOC's three powerful working groups from key California open government legislation, the ICOC has the ability to change that policy. "Some closed sessions are legitimate and legal," said Marcy Darnovsky. "But there is no justification for letting the working groups operate virtually in secrecy, with no assurance that effective conflict of interest protections are in place." CGS has called on the ICOC to adopt as policy that working group meetings, with few and explicit exceptions, be subject to the Bagley-Keene Open Meeting Act and the Public Records Act, and that members of the working groups be subject to the Political Reform Act.