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Fortune Magazine on California Stem Cell Agency: Warm, Personal and Favorable

Posted: September 30, 2012 at 3:46 pm

California's $3 billion stem cell
research effort today garnered a handsome dollop of favorable
national news coverage– a lengthy piece in Fortune magazine that
spoke of looming stem cell cures and the leading role of the state
stem cell agency.

The article led the Fortune web page online at one point this morning and
likely will be read by tens of thousands of persons, although it was not the cover story on the print product. 
Written by a former senior editor of
the magazine, Jeffrey O'Brien of Mill Valley, Ca., the piece was warm
and personal. He began with the story of his 95-year-old
grandmother and her health issues, ranging from arthritis to macular
degeneration. And he wrote,

“The citizens of California have
spoken. If my grandmother and I had the power to get the rest of the
country to follow, we would.”

O'Brien also discussed the science and
finances of the stem cell business. He said,

“To be clear, the earliest stem cell
therapies are almost certainly years from distribution. But so much
progress has been made at venerable research institutions that it now
seems possible to honestly discuss the possibility of a new medical
paradigm emerging within a generation. Working primarily with rodents
in preclinical trials, MDs and Ph.D.s are making the paralyzed walk
and the impotent virile. A stem cell therapy for two types of macular
degeneration recently restored the vision of two women. Once they
were blind. Now they see!

“Some experts assert that AMD could
be eradicated within a decade. Other scientists are heralding a
drug-free fix for HIV/AIDS. Various forms of cancer, Parkinson's,
diabetes, heart disease, stroke, and ALS have already been eradicated
in mice. If such work translates to humans, it will represent the
type of platform advancement that comes along in medicine only once
in a lifetime or two. The effect on the economy would be substantial.
Champions of stem cell research say it would be on the order of the
Internet or even the transistor.”

O'Brien continued,

“The obstacles along the road from
lab rat to human patients are many, of course, but the biggest by far
is money. With the dramatic events in the lab, you might think that a
gold rush would be under way. That's far from true. Long time
horizons, regulatory hurdles, huge R&D costs, public sentiment,
and political headwinds have all scared financiers. Wall Street isn't
interested in financing this particular dream. Most stem cell
companies that have dared go public are trading down 90% or more from
their IPOs. Sand Hill Road is AWOL. The National Venture Capital
Association doesn't even have a category to track stem cell

As for the California stem cell agency
itself, the article contained remarks from its Chairman J.T.Thomas,
President Alan Trounson and former chairman Robert Klein about the origins and progress of the California Institute for Regenerative Medicine (CIRM).
O'Brien wrote, 

“The $1.7 billion awarded so far has made one obvious mark on the state: a dozen gleaming research institutions. CIRM has proved adept at getting billionaires to donate funds to the cause.”

O'Brien interviewed a several
prominent businessmen who have contributed tens of millions of
dollars to stem cell research “about the prospects of a legitimate industry emerging.” One was “bond genius” Bill Gross, who has
contributed to UC Irvine. Gross replied.

“Goodness, you're talking to the
wrong guy. Our donation had nothing to do with business.”

Eli Broad, another big stem cell donor,
said pretty much the same thing. And Andy Grove, the former chairman
of Intel, was “surprisingly full of doom and gloom.” O'Brien

“For close to two hours, Grove argues
passionately about how the FDA is enabling predatory offshore
industries by impeding progress and the many reasons financiers want
no part of stem cells. "VCs aren't interested because it's a
shitty business," he says. Big Pharma? Forget it. CIRM? "There
are gleaming fucking buildings everywhere. That wasn't necessary."
When I press him to be constructive, he wearily offers one possible
solution. Rather than courting billionaires to put their names on
buildings, we need a system of targeted philanthropy in which the 99%
can sponsor the individual stem cell lines that matter to them.”

O'Brien said, however,

“It was clear during our talk that
Grove wants an economic model for stem cell research and development
to emerge, even if he's not willing to bet money on its happening.
And that puts him in good company.”

While the Fortune article has its
negative points about stem cell research, it is about as laudatory as
it is going to get at this point for the California stem cell agency.
The piece recognizes and even celebrates much of the work of the
agency. The article clearly details the void in financing
for commercialization of stem cell research, bolstering support for
efforts like those in California. Importantly, it also helps to push
the activities of the stem cell agency more fully into the national
discussion of stem cell research and its future. That should pay off
again and again in future news coverage and also benefit the stem
cell agency as it explores the possibility of additional funding –
either private or public – after the cash for new awards runs out
in 2017.

(The story is in the Oct. 8, 2012, edition of Fortune.)


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