Looking a gift horse in the mouth

The California stem cell agency is preparing to give its first grants to for-profit entities. But instead of lining up, many businesses are claiming they'll stay away because too many strings are attached. This may be true, or the companies may be trying to game the system in hopes of more favorable terms. In any case, it does not justify removing the obligations that come with grants of taxpayer dollars.

The purpose of public funding of research isn't simply to give money away. It's to encourage desirable actions, such as medical research, that wouldn't have occurred in the absence of the public funds. If private funding is available, then the California Institute for Regenerative Medicine (CIRM) or the National Institutes of Health shouldn't lower their standards and crowd out private sector support. And nor should the funding agencies broaden what they are willing to fund just to get the money out they door.

But that is a real danger with the CIRM. Although there is likely not enough current stem cell research capacity in California to warrant $300 million in grants per year, there's no effective mechanism to prevent as much money going out the door as possible, regardless of the research's quality. The CIRM's governing board is dominated by representatives of grant recipients - from the public, nonprofit, and corporate sectors alike. The agency is not required to report to the Legislature to justify further appropriations. And if the board actually restrained funding, it could potentially be interpreted by the public as not fully doing its job.

On a related note, among the executives who provided negative comments about the grants in a recent newspaper article was the CEO of StemLifeLine. That's the company that's been roundly criticized not only on this blog, but by Lord Robert Winston -  the UK's leading fertility expert - as a "clear example of exploitation of the worries of couples about the fate of their children.... There is no scientific evidence to sustain the notion that this will be a useful procedure," by David Magnus as "essentially taking advantage of people's ignorance and fears to make a buck," and by Arthur Caplan as "a gimmick and many of the claims rest on hot air." In this case, the CIRM and California taxpayers shouldn't be losing any sleep over a lost opportunity.