New York Times 9/20/04
Californians to Vote on Spending $3 Billion on Stem Cell ResearchBy JOHN M. BRODER and ANDREW POLLACK
LOS ANGELES, Sept. 19 - The federal government spent $25 million last year on studies involving human embryonic stem cells. But California, in an act of political and scientific rebellion against limits on stem cell research imposed by the Bush White House, may be on the verge of spending $300 million a year in each of the next 10 years on such research.
A coalition of Hollywood producers and actors, technology billionaires, scientists, patient advocates and business organizations - including Michael J. Fox and Bill Gates - has marshaled emotion, scientific argument and money to underwrite a state ballot proposal that would let Californians make the decision. The initiative on the Nov. 2 ballot, known as Proposition 71, would authorize the state to issue $3 billion in bonds to pay for a range of stem cell research. This promising but ethically controversial field of biomedical research is now severely limited by the Bush administration's policy restricting public money for research on embryonic stem cells.
Others are also moving to facilitate more stem cell research. Gov. James E. McGreevey of New Jersey signed legislation in May to establish a state-supported stem cell research facility, and researchers at Harvard are raising millions of dollars for a stem cell institute.
But the California initiative would create by far the largest state-run scientific research effort in the country and make California a global center of stem cell research, on par with Singapore, Israel, South Korea and the United Kingdom, which have moved aggressively in the field since the late 1990's.
Critics say the initiative would be a publicly financed windfall for pharmaceutical and biotechnology companies, while repaying little to the taxpayers. They expect to be outspent by at least 20 to 1 by supporters of the initiative and add that the state cannot afford $3 billion in new debt when it is reducing spending on education, health care and public safety.
Gov. Arnold Schwarzenegger has said that he supports stem cell research in principle but has not announced a position on the initiative.
The public appears to be about evenly split, though it has not yet been exposed to an expected barrage of television advertising featuring testimonials from scientists, celebrities and those suffering from diseases, including Alzheimer's, Parkinson's and diabetes, that might be treated by therapies derived from stem cells.
Backers of the measure include celebrities like Mr. Fox, who has Parkinson's disease, and Christopher Reeve, who was paralyzed in a riding accident. It is also supported by dozens of elected officials, 22 Nobel laureates, 50 patient advocacy groups and several business organizations.
George P. Shultz, a Republican and a former secretary of state under President Ronald Reagan, and the California Chamber of Commerce support it, as do California's senators and more than half of its Congressional delegation. Mr. Reagan died in June after a long battle with Alzheimer's, but his widow, Nancy, and their son, Ron Reagan, have not taken a stand on the measure, though they have made clear their support for stem cell research in the past.
Supporters have already raised nearly $15 million, with some donors giving more than $1 million.
Among the major contributors are Pierre M. Omidyar, the founder of eBay, who with his wife, Pamela, has given more than $2 million; Mr. Gates, the founder of Microsoft, who gave $400,000; William K. Bowes Jr., a founder of Amgen, who contributed $1.3 million in company stock; Senator Jon S. Corzine, Democrat of New Jersey, who gave $100,000; and John Doerr, the Silicon Valley venture capitalist, who contributed $974,000. The Juvenile Diabetes Research Foundation has contributed $1 million to the committee sponsoring the initiative.
Robert N. Klein, a Palo Alto real estate developer, is leading the effort to pass the measure and has contributed more than $2 million. Mr. Klein's 14-year-old son has juvenile diabetes, and his mother has Alzheimer's.
"We are on the edge of one of the great watershed medical discoveries in history," Mr. Klein said. Half of California's families are affected by one or more of the 70 diseases or conditions that could respond to stem cell therapies, he said, and the research could significantly reduce the $110 billion spent on health care in the state each year. In his view, California has the research infrastructure and the financial ability to support this venture.
"We have more than 50 percent of the biotech capacity in the United States and more than most other countries," he said. "We can run a substitute national program."
Opponents have raised about $150,000, much of it from the state and national Catholic Church and from Howard Ahmanson Jr., a conservative businessman from Orange County. They oppose the research because it destroys embryos and because some believe it leads down a slippery slope to human cloning.
"I'd say we were David going up against Goliath," said Wayne C. Johnson, a Republican consultant in Sacramento who is coordinator of the effort opposing the proposal, "but David had five smooth stones, and we don't have that yet."
The debate over embryonic stem cell research is among the most difficult in politics and science. Many scientists and patient advocacy groups believe these cells, which are the basic building blocks of the body from which the organs and other cells develop, can yield therapies and cures for diseases that affect as many as 125 million Americans.
But to develop the self-perpetuating colonies of stem cells, researchers must destroy human embryos, an act that is abhorrent to some religious conservatives and opponents of abortion, an important part of the Republican Party's base.
The California initiative emphasizes financing for embryonic stem cell research, but also provides money for adult stem cell research and specifically prohibits spending on human cloning.
Despite the proponents' advantages in money and endorsements, the public remains skeptical and, at this point, divided along partisan lines, according to a Field Poll published in August. The survey showed 45 percent of California voters favoring the stem cell initiative and 42 percent against it. Democrats favor it by 2 to 1, while Republicans oppose it by a comparable margin. However, only 40 percent of the respondents said they knew much about the proposal.
Mr. Johnson said there were numerous arguments against the proposition, beyond the moral objections. California is already heavily indebted and is having trouble meeting its day-to-day expenses. He also said that the measure contained insufficient ethical safeguards and could lead to profiteering by venture capitalists and biotechnology interests.
The measure would give the governor and the Legislature virtually no power to direct or oversee spending. "There's no guarantee that one dime goes to the public," Mr. Johnson said. "It's an absolutely no-strings-attached gift of $3 billion."
He also said that the measure devoted a lot of money to a scientific field that was still in its infancy, while giving nothing to other, more mature medical technologies. The National Institutes of Health spent $24.8 million on research involving human embryonic stem cells and $190.7 million on human adult stem cell research in fiscal year 2003, a spokeswoman said. The institutes' entire budget that year was about $27 billion.
Backers of the plan dismissed all these points, saying there were stringent rules in the proposal to ensure that the research was conducted under federal ethics guidelines and that royalties were paid to the state. The plan also calls for a 29-member commission to review grants and report annually to the Legislature.
The committee promoting the plan released a study last week that said the measure would pay for itself in lower health care costs and higher income and sales tax revenues. The study, financed by the initiative's proponents, also predicted that the research would generate $537 million to $1.1 billion in royalties to the state over the next 35 years.
Some scientists said they hoped the initiative would set off a chain reaction in other states and, at the least, make embryonic stem cell research more acceptable.
"It changes the community's perception of the value of the work," said Dr. Steven A. Goldman, chief of cell and gene therapy at the University of Rochester Medical Center, of the prospect of the plan's passage.
Backers of Proposition 71 say that the stem cell research could also spawn a big industry in California because new discoveries will lead to new companies.
Some point to genetic engineering, which was developed in the 1970's by scientists at Stanford and the University of California at San Francisco. One of those scientists helped found Genentech, the first company to exploit that technology. Genentech is now one of the world's biggest biotechnology companies, and hundreds of other biotechnology companies are based in California.
Still, whether this happens with stem cells depends to some extent on whether the technology proves commercially useful. Venture capitalists have been reluctant to invest much in the field directly because the potential payoff is years away.
Yet venture capitalists are among the biggest donors to the Proposition 71 campaign. Critics contend that private investors are supporting the initiative in the hopes of getting the public to pay for the research until it is ready for commercial application.
Joseph S. Lacob, a partner at the Menlo Park, Calif., venture capital firm Kleiner Perkins Caufield & Byers, gave $500,000, even though he said he did not expect any immediate commercial profit from the work. Mr. Lacob said he was a Republican who voted for President Bush in 2000, but he said he was angry that the president had shut down what he considered a promising avenue of research.
"This country is falling behind because of an administration directive that I think is totally in error," Mr. Lacob said. "I felt something had to be done to send a message to the Bush administration and the world that the United States and particularly California is going to take a leadership role."