State stem cell agency rejects 10 applications for grant money

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San Francisco Chronicle

California’s stem cell agency on Friday acknowledged that it has turned back 10 grant applications worth millions of dollars because the applications were accompanied by letters of support from members of its own governing board.

But the state-financed California Institute for Regenerative Medicine declined to identify which grants were dinged and which board members potentially violated conflict-of-interest rules by signing the letters meant to bolster the case for grant approval.

Sources have told The Chronicle that four of the institutions whose young scientists lost out on their grant applications were UCSF, UCLA, the University of Southern California and UC San Diego.

The applicants were instructed to provide letters of support from their medical school deans or department heads. However, the deans of California’s most prestigious medical schools sit on the Independent Citizens’ Oversight Committee, the stem cell agency’s governing board. And another part of the stem cell program rulebook prevents board members from “in any way” using their influence to affect a grant application.

When staffers of the stem cell agency found letters of support from board members in the applications, they determined that the applications had to be rejected.

“Clearly, we regret that through no fault of their own, a number of brilliant and promising young scientists will not receive New Faculty awards,” said Richard Murphy, the interim president of the stem cell agency.

Until the problem was discovered, the governing board had anticipated that it would be approving up to $85 million in new grants through the program, which was designed to attract young scientists to the stem cell field. Typical grant applications sought between $1.3 million and $3 million over a five-year period.

On Friday, the stem cell institute said the board is now likely to approve up to $60 million in grants at its meeting in Los Angeles on Wednesday. It will set up a new grant application process and award additional grants in about six months – a second chance for the 10 applicants whose grants had the problematic letters of support.

In addition, the board will set in place a series of steps to assure that there is no further confusion about the rules. The legal staff will provide board members with specific guidance about the nuances involved in each grant application, said stem cell agency spokeswoman Ellen Rose. The rules for each grant application also will receive “more rigorous review” before they are published. “We need to do a better job of communicating,” she said.

John Simpson, of the Santa Monica-based watchdog group Foundation for Taxpayer and Consumer Rights, said the academic deans on the board should have known better. “Some of these academics just don’t get it,” he said.

E-mail Sabin Russell at [email protected].

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