Consumer Advocates Say Wisconsin Research Group’s Stem Cell Prop. 71 Claims Are Outrageous Raid on California’s Treasury

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Santa Monica, CA — Plans by a research group affiliated with the University of Wisconsin to claim licensing payments from California’s stem cell research institute are “little more than an outrageous attempt to raid the treasury of California,” the Foundation for Taxpayer and Consumer Rights (FTCR) said today.

“Payment to California for discoveries resulting from taxpayer-funded research is not a commercial activity,” said John M. Simpson, FTCR’s Stem Cell Project Director, “It’s merely an attempt to recoup a portion of taxpayers’ money that originally funded much needed stem cell research. I cannot fathom how such responsible stewardship of taxpayers’ money would make you think WARF is entitled to license payments.”

In a letter to Carl E. Gulbrandsen, managing director of the Wisconsin Alumni Research Foundation (WARF), Simpson asked WARF to explain its claims fully within a week so they can be discussed in a public forum and if it becomes necessary to take formal steps to remedy the situation.

“It would truly be a shame if a research organization in Wisconsin threw up a blockade to vital, publicly funded research in California, ” Simpson wrote. “Indeed, residents of your state will ultimately benefit from discoveries made here.”

Read FTCR’s letter.

WARF is a non-profit foundation affiliated with the University of Wisconsin that manages inventions made by the university’s professors. The foundation claims U.S. patents on all human embryonic stem cells in the United States no matter where or how they are derived — or who derived them. No other country in the world recognizes the patents.

Elizabeth Donley, WARF general counsel told a conference packed with biotech executives organized by Burrill & Company in San Francisco that because the stem cell institute requires 25 percent of royalties non-profit grantees might eventually receive to be returned to the state, WARF would demand license fees and payments on all embryonic stem cell research funded under Prop 71.

FTCR noted that policymakers are debating and formulating key elements of policy governing the California Institute of Regenerative Medicine (CIRM) and its grant-making policies. “It is only fair that they, and the California public, know your exact position if it becomes necessary to take formal steps to remedy the situation,” Simpson wrote Gulbrandsen.

FTCR noted that WARF receives millions of dollars from the National Institutes of Health. “The obstructionist approach displayed toward public research in California calls into question whether your organization deserves such money,” Simpson wrote.

California’s voters overwhelmingly approved Proposition 71 budgeting $3 billion for stem cell research. With bond financing, taxpayers will spend $6 billion. Although approved in 2004, not a dime has been spent on research because Prop 71 faced legal challenges. A decision in the case is expected soon, though whatever the verdict, it will almost certainly be appealed, likely delaying research funding until next year.

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The Foundation for Taxpayer and Consumer Rights is California’s leading non-profit and non-partisan consumer watchdog group. For more information visit us on the web at: Our stem cell information page is at located at:

Consumer Watchdog
Consumer Watchdog
Providing an effective voice for American consumers in an era when special interests dominate public discourse, government and politics. Non-partisan.

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