A leading member of California’s stem cell research
governing board was recently criticized for a letter of appeal he submitted
last summer to reverse a board decision rejecting a grant proposal made by his
La Jolla research group. The alleged conflict of interest, meanwhile, has
rekindled statewide debate over medical researchers’ participation in the
allocation of their own funding.

In August, Burnham Institute for Medical Research President
and CEO John Reed contested the rejection of a $638,000 grant that would have
gone to a Burnham-affiliated researcher. Reed sent an appeal to Arlene Chiu,
chief scientific officer of the California Institute for Regenerative Medicine
— a body governed by the Independent Citizens Oversight Committee, of which
Reed is a member.

John Simpson, director of the Foundation for Taxpayer and
Consumer Rights, is one of several individuals calling for Reed’s resignation,
as well as that of ICOC Chairman Robert Klein, who advised Reed to submit the
appeal.

“You can’t kind of shuffle your feet and say, ‘Aw, shucks.’
This is serious,” Simpson said. “Reed is a wonderful scientist and a good
executive at Burnham, but I think this is something that needs to be nipped in
the bud before it becomes the normal way that things are done at the ICOC.”

Simpson expressed a similar sentiment regarding Klein’s
involvement in the incident.

“[Klein] gave Reed advice to break the law,” he said. “They
should both go.”

Michael W. Kalichman, director of the UCSD Research Ethics
Program and the San Diego Stem Cell Research Ethics Consortium, said that Reed
has an obvious conflict of interest in the matter. However, he said he believed
that Reed’s decision to send the letter represented a misunderstanding of
specific regulations rather than an error in judgment, and sees no reason for
any resignations.

“There is nothing on the surface that is wrong about having
a conflict of interest,” Kalichman said. “The question is, what do we do when
we have that conflict? It’s clear that on the surface this doesn’t look good,
but it’s not as black and white as I think some people want to portray it.”

Simpson attributed some of the conflict to Proposition 71,
whose November 2004 passage established the California Institute for
Regenerative Medicine and the ICOC. He said the committee’s large size and the
number of appointed members who compete for the money are fundamental
structural flaws.

“We’re working with the law as it exists, but [CIRM] was
designed under Prop. 71 with built-in conflicts,” he said.

Kalichman disagreed, saying that it is reasonable to grant
oversight responsibilities to experts such as Reed.

“The alternative would be to put people in who don’t know
what the best choices are,” he said.

In a Nov. 21 interview with the publishers of the California
Stem Cell Report blog, CIRM Interim President Richard Murphy said that since
the board had already made its decision when it received Reed’s letter, the
confusion was simple to address and no penalty is necessary.

“As soon as CIRM staff received the letter, counsel advised
Dr. Reed that he must refrain from contacting the staff and board members
regarding a grant to Burnham and advised staff to disregard Dr. Reed’s letter,”
he said. “It therefore had no effect on CIRM’s process.”

At the annual meeting of the Citizens Financial
Accountability Oversight Committee in San Francisco on Nov. 27, Simpson argued
that Reed and Klein should step down. State Controller John Chiang responded by
sending a letter to the Fair Political Practices Commission requesting an
inquiry into the allegations.

“Whether they are perceived or real blemishes, we must
resolve any conflict of interest questions quickly so we can protect the
important and powerful work that is taking place in stem cell research,” Chiang
said.