SAN FRANCISCO - The same day that President Bush won a second term, California voters approved a bold plan to pour $3 billion of taxpayers' money into stem cell research over the next decade. Supporters argued the investment would save millions of lives through new medical therapies, generate millions of dollars in added tax revenue, cut healthcare costs by billions, and create thousands of high-paying jobs.
Three years later, Californians are still waiting for some results. Until recently, most of the money was tied up in lawsuits. And even now that the tap is flowing, proponents acknowledge it could take years, if not decades, for the grants to pay off.
"It's too early," said Alan Trounson, president of the California Institute for Regenerative Medicine, the agency charged with administering the stem cell funds. "There are very few substantial developments [in medical science] that have happened in less than 25 years. There have been some, but they tend to be rare."
The slow rate of progress serves as a reality check for Massachusetts and other states that have followed California's lead by placing big bets on medical research. Texas voters approved a $3 billion commitment to cancer research in November. New York has set aside $600 million for stem cell work. And later this month, Massachusetts lawmakers are expected to vote on Governor Deval Patrick's $1 billion life sciences initiative, which is primarily targeted for research.
Patrick said his plan will create 250,000 jobs within 10 years, an ambitious figure that has generated some skepticism. Massachusetts currently has about 60,000 to 75,000 life sciences jobs.
To be sure, Patrick's proposal differs in some key ways from California's. For instance, it sets aside $250 million in tax incentives to encourage companies to expand, something that could yield immediate results. It also allocates money for workforce training. And unlike California, the Massachusetts research funding is not restricted to stem cell research.
"This is not a stem cell bill," said Kofi Jones, a spokeswoman for the state's economic development agency. But, as in other states, the bulk of the bill is related to life sciences research, which typically takes time to generate results. Specifically, $250 million is reserved for grants for research, fellowships, or workforce training. Another $500 million would support public research and education facilities, including a stem cell bank to be housed at the University of Massachusetts Medical School in Worcester and a research center focused on RNA interference, an area pioneered by UMass researcher Craig Mello.
Unlike the Massachusetts proposal, California's stem cell plan didn't come from politicians. It was the brainchild of Robert Klein, a well-connected California lawyer and low-income housing developer. Klein said he got involved as a patient advocate: His son has diabetes, and his mother has Alzheimer's disease. When federal officials decided to limit funding for embryonic research, Klein thought California could help fill the gap. Embryonic stem cell research holds immense promise because stem cells can potentially morph into any other kind of cell, making it possible for them to replace other cells that have been damaged.
Instead of going through the Legislature, Klein organized a ballot initiative, taking the proposal directly to voters. The initiative drew opposition from fiscal conservatives, who worried California could not afford it, and religious conservatives, who oppose stem cell research on the grounds that it often involves destroying human embryos. But the plan also drew support from venture capitalists, scientists, and patient advocates. In the end, 59 percent of voters approved the measure.
A few months later, however, conservative opponents filed a lawsuit arguing the initiative was unconstitutional, effectively blocking the state from floating the $3 billion in bonds for two years. The litigation ended in May 2007 after opponents lost several early rounds and the California Supreme Court declined to hear their appeals. Before the case was settled, the new stem cell agency got started with other funding. Philanthropists donated $45 million. And Governor Arnold Schwarzenegger authorized $150 million in loans.
In April 2006, the agency dispersed its first grants - $12 million to train stem cell researchers at 16 nonprofits. A steady stream of other grants has followed. To date, the California Institute for Regenerative Medicine has approved 156 research grants totaling $260 million, which the institute says is the largest source of funding for embryonic stem cell research in the world. The agency plans to award another $227 million in grants this year for the construction of laboratories at academic and nonprofit research institutions.
The grants have not been without controversy. Critics have repeatedly complained that the process is vulnerable to conflicts of interest. California state controller John Chiang ordered an audit last year after an institute board member, John Reed, allegedly pushed the agency to reconsider a grant to a nonprofit research center Reed oversees. The stem cell agency rejected several applications for grants because they contained letters of support from board members.
Regardless, proponents say the initiative has inspired dozens of top stem cell researchers from around the world to move to California in the past two years, including some from Harvard University and the Massachusetts Institute of Technology. The University of California, Los Angeles alone says it has been able to recruit a half-dozen researchers.
"It's bringing scientists from all over the world," said Steven Peckman, associate director of UCLA's stem cell research center. But some Massachusetts officials downplay the impact of the academic defections, saying researchers routinely move from one school to another, including some who have recently left California. For instance, Kenneth Chien left the University of California, San Diego in July 2005 to take posts at the Harvard-affiliated Massachusetts General Hospital and Harvard Stem Cell Institute.
"I do not see a migration" to California, said Brock Reeve, executive director of the Harvard Stem Cell Institute.
And some of the stars that the California institute says have migrated to California have only partially committed to the West Coast. For instance, the institute says James Thomson, a professor at the University of Wisconsin, moved to the University of California, Santa Barbara. But Thomson simply opened a satellite lab in Santa Barbara, school officials said.
"Dr. Thomson remains at the University of Wisconsin as a full-time faculty member," said the university's spokesman, Terry Devitt.
California officials also point out that a handful of for-profit companies have expanded in the state since the stem cell plan was approved. One of the country's best known stem cell companies, Advanced Cell Technology Inc., moved its corporate headquarters from Worcester to California in 2005 to qualify for stem cell grants. But it still has 30 employees in Massachusetts, compared with 10 in California.
"From a legal standpoint, we're from California. But a predominance of our employees are in Massachusetts," said William Caldwell, Advanced Cell Technology's chief executive.
Tracy Lefteroff, a partner at PricewaterhouseCoopers who coauthored a report on California's biomedical industry, said the $3 billion stem cell initiative still has potential to create thousands of jobs. But he said it will probably take at least another five years.
"I don't think it has had that much of an impact yet," Lefteroff said.
Trounson said he is hopeful that some promising treatments will be in clinical trials within a decade, but will probably take several years beyond that to be approved by regulators.
"The money is not going to have immediate results," said Zach Hall, the California institute's former president. "That's just not the way science goes."
Todd Wallack can be reached at email@example.com.