CALIFORNIA: Ballot Drive Puts Stem-Cell Funding In Voters' Hands
ANTONIO REGALADO, and MICHAEL WALDHOLZ
The Wall Street Journal

Wednesday, March 31, 2004

(03-31) 05:29 PST (AP) -- ROLLING HILLS ESTATES, Calif. -- Dick Seaberg, a 70-year-old antiabortion Republican, lives
near Los Angeles in one of California's most conservative districts. Yet on a recent Saturday morning he was at
Starbucks at the Avenue of the Peninsula mall wearing a homemade sandwich board that read, "Please sign petition for
stem cell research."

His goal: get signatures for a statewide ballot measure that seeks to raise $3 billion for research on stem cells taken
from human embryos. "I have a grandson with juvenile diabetes, we'd like to find a cure," Mr. Seaberg explained to a
passerby.

The initiative -- which would appear on California's November ballot -- represents a major new intersection of science
and politics. For the first time, advocates are bypassing government officials and asking voters directly to approve
public funding for controversial, cutting-edge scientific research. If successful, the initiative could change the U.S.
scientific landscape and send a message that the White House faces significant dissent over its decision not to provide
federal funds for some stem-cell research.

The measure would supply universities and the biotechnology industry with as much as $295 million a year for 10 years,
raised through the sale of state bonds. And it would position the region as a mecca for biologists and investors
pursuing stem-cell research. If it fails, however, it would be a setback for efforts to change federal policy and could
embolden stem-cell opponents, such as Christian groups.

The ballot effort highlights the growing influence of disease activists, particularly families such as Mr. Seaberg's
that are affected by type 1 diabetes. Not since AIDS activists stormed scientific meetings in the 1980s has a patient
group done more to set the agenda of medical research.

Diabetes activists believe that stem cells grown in a laboratory can offer a novel treatment by replacing the insulin-
making cells that type 1 diabetes kills off. Without those cells, daily shots are needed to maintain blood-sugar
levels. Later in life, those with the disease face possible blindness or amputations.

Behind the ballot drive are wealthy Californians whose children have juvenile diabetes, or who suffer from it
themselves. Backers include such well-known Hollywood figures as Douglas Wick, a producer of "Gladiator," and Jerry
Zucker, director of "Ghost," and his wife, Janet, a producer. The effort -- dubbed the California Stem Cell Research
and Cures Initiative -- also is gathering endorsements from big scientific names, including David Baltimore, Nobel-
prize winner and president of the California Institute of Technology.

The group's executive committee also includes families coping with a range of debilitating conditions, including Lou
Gehrig's disease and spinal injuries. And its success depends on mobilizing a wide swath of patient-advocacy
organizations.

But the effort represents just one part of a wider stem-cell push by diabetes activists, led by their national
organization, the Juvenile Diabetes Research Foundation International. Many backers of the California measure are
members of the JDRF, and the group is providing critical cash and lobbying help to the effort.

Overall, the JDRF has poured millions of dollars into private stem-cell research, and has become adept at unleashing an
army of hard-to-resist lobbyists -- made up of determined parents and their afflicted children -- on researchers,
politicians and potential donors. The group's local volunteers played a critical role in getting New Jersey in January
to pass a law to "promote" stem-cell research, and other local chapters are pushing similar legislation in Illinois and
New York. The group is amassing from donors a $20 million stem-cell research war chest, an effort spearheaded by
actress Mary Tyler Moore, a longtime JDRF activist who has type 1 diabetes.

The foundation's cash has yielded scientific results. Earlier this month, Harvard researchers supported by the JDRF
created 17 new batches of stem cells derived from embryos, and said they would provide them free to other researchers
outside the government's limits.

Critics and supporters alike say the JDRF has become a prominent force by wielding significant financial resources and
exploiting celebrity connections. Television host Larry King is on the JDRF board, and Edsel B. Ford II, a director of
Ford Motor Co., leads the company in an annual fund-raising walk that raised $3 million in 2003.

The California ballot drive is the most ambitious plan yet by advocates to chart a course independent of federal
policy. The initiative's backers believe California is the only state that can pull off a scientific secession of this
magnitude. The state's economy is among the world's six largest, and it is home to 40 percent of all U.S. biotechnology
companies.

California's fiscal crisis and opposition from religious groups could derail the effort. The state faces a $12 billion
shortfall in its 2004-2005 budget, on spending of $75 billion, according to Brad Williams, the senior economist in
California's Legislative Analyst's Office. The office calculates the stem-cell bonds would cost $6 billion to pay off
over 30 years.

Initiative planners have tried to postpone the pain to taxpayers, designing the bonds so that they don't draw on the
state's general fund until 2010. By that time, they hope, research will have paid off and public support will be high.

Robert Klein, the Palo Alto real-estate developer leading the ballot drive, says extensive polling indicates the
initiative can win the simple majority needed to pass. A key factor: Nearly 85 percent of Californians have a family
member or close acquaintance with one of five conditions -- Alzheimer's, diabetes, heart disease, Parkinson's or spinal-
cord injury -- that potentially could be treated with stem cells.

For most of these ills, cures from stem cells are still a distant dream. Not so for type 1 diabetes. In 1999,
physicians funded by the JDRF began transplanting insulin-making cells from the pancreases of cadavers into adults with
type 1 diabetes. Dubbed the Edmonton Protocol after the Canadian city in which it was developed, 300 patients have been
treated with it, about 100 in the U.S. According to the International Islet Transplant Registry, as of June 2003, about
50 percent of the patients have gone without insulin injections for up to a year after receiving a transplant.

But the transplants have limitations. Children can't tolerate the antirejection drugs transplant recipients must take.
And the procedure requires as many as three cadavers to yield enough cells to treat a single adult. There aren't nearly
enough cadaver donors to treat the 20,000 to 30,000 children in the U.S. and tens of thousands more elsewhere who
develop type 1 diabetes each year.

JDRF scientists believe that the solution may be embryonic stem cells, which are believed to be capable of generating
any other form of human tissue. The JDRF now funds extensive work to transform the cells into functioning islets --
clusters of pancreas cells that make insulin. (A supply of islets wouldn't overcome the need for antirejection drugs.)

In 2001, stem cells landed the JDRF in the middle of a heated national policy debate -- one that led to the creation of
the California ballot initiative. That year, President Bush halted a National Institutes of Health plan to fund
research on embryonic stem cells. Key supporters of the administration believed that the research immorally destroys
early human life. The cells are extracted from days-old embryos created in fertility laboratories, consisting of about
150 cells.

This closed a loophole from the Clinton administration. Back then, federal law already prohibited the government from
using public funds to destroy embryos. But the Clinton administration interpreted the rule to mean that public research
grants could still be used to study stem cells -- as long as the cells had been extracted using private funds.

In early 2001, the JDRF, along with other groups, launched a vigorous lobbying effort to keep the loophole open. The
JDRF deployed its most potent weapon, children with type 1 diabetes, who descended on the capital in early summer. When
advocates heard a rumor Mr. Bush was close to ruling, JDRF families flooded the White House switchboard.

The president announced a compromise on Aug. 9, 2001. The NIH would be allowed to fund research on about 60 supplies of
stem cells already extracted from embryos and being grown in laboratories -- but it wouldn't be allowed to study any
new supplies. The JDRF expressed concern, but JDRF President and Chief Executive Peter Van Etten says he felt it was a
significant victory.

Some influential members of the organization were less impressed. That night, Hollywood producers Janet and Jerry
Zucker called Mr. Van Etten and questioned the JDRF's stance. Also on the call was Mr. Wick, the producer, and his
wife, filmmaker Lucy Fisher. Both families have young daughters with type 1 diabetes. Mr. Zucker says he dreamed of
meeting the president and asking, "What is the responsibility of someone who stops science if there could be cures?"

Mr. Van Etten felt it was important to give the government time "to see if the promise of the cells and the research
played out." But the families were eager to act, and Stanford University stem-cell expert Irving Weissman and Nobel
Laureate Paul Berg, who shared their anger over political limits on research, pointed them to a related issue.

In 2001, the House of Representatives had passed a bill that criminalized reproductive cloning, or making cloned
babies. But it also targeted creating cloned human embryos in the laboratory. Many scientists believe such methods are
potentially important in stem-cell research, for instance as a way to create customized stem cells bearing the DNA of
living individuals. The scientists told the Zuckers that such matched cells could overcome immune-rejection barriers --
such as those that have limited the Edmonton protocol. They were concerned the Senate might endorse the ban.

Together with the Wick family, the Zuckers founded a "guerrilla effort" called CuresNow. They hired a lobbyist, met
with 15 senators and ultimately took the campaign to the airwaves with television commercials. The JDRF leadership kept
its distance from CuresNow, says Mr. Van Etten. They viewed the group as unpredictable. And producing embryos through
cloning remains highly controversial. The JDRF has never directly endorsed the technique and has never funded
scientists to pursue it.

But cloning had clearly become the new battleground. With the Senate legislation in a holding pattern, states began
writing their own laws. Iowa and Michigan passed measures outlawing the procedure. In California, State Senator Deborah
Ortiz introduced legislation to explicitly allow it. A scientific team including Drs. Berg and Weissman advised on
policy and helped rally support.

When the bill passed in August 2002 it signaled that California was a safe haven for research. Major government funding
remained the missing link. When Sen. Ortiz suggested a ballot proposition as a way to bypass the legislature, her
scientific contacts steered her toward the Zuckers. By March 2003, the group had a major planning meeting in the
Zuckers' home in Hollywood.

By then, JDRF's leadership in New York had decided that the Bush stem-cell policy wasn't working. Only about 15 of the
60 stem-cell supplies had become widely available, and the political cloud over the field was discouraging scientists.
The JDRF's scientific-review committee was having difficulty finding high-quality research in the U.S. to fund.

Sensing an opportunity in California, the JDRF began to give the ballot organizers crucial assistance. Mr. Van Etten
introduced the Zuckers to Mr. Klein, a wealthy developer and major Democratic campaign donor who had lobbied in
Washington for another JDRF success -- a $1.5 billion special-funding bill for diabetes that passed in 2002.

Until then, the ballot idea "was kind of limping along," says Lawrence Goldstein, a biologist at the University of
California, San Diego who helped draft the initiative. But Mr. Klein, whose son has type 1 diabetes, soon took on the
lead role. He contacted lawyers and oversaw the complex process of designing the bond structure. He has also put in
$1.4 million of his own money, the lion's share of the $3 million raised so far.

Under Mr. Klein's leadership, the initiative has become a highly credible effort and an "institutional priority" for
the JDRF, according to Mr. Van Etten. In March, the JDRF gave the initiative $500,000 it needed to pay the professional
firms that are gathering most of the 700,000 signatures needed to qualify for the ballot by April 16.

One key factor behind JDRF's decision: the risk that a loss at the polls could encourage President Bush to stick with
his current stem-cell policy. "We need them to succeed. Because if it fails, it will be hard to get the president to
move," Mr. Van Etten says.

Some observers see trouble ahead. State voters are reluctant to approve costly bond issues. And the measure's strong
support for more controversial research on cloning could turn into a serious liability. One wild card is Arnold
Schwarzenegger. A person who attended a dinner last year at the Zuckers' home along with Gov. Schwarzenegger says the
governor expressed enthusiastic support for embryonic stem-cell research. An endorsement would greatly improve the
measure's chances, but the governor could also remain silent on the initiative or even oppose it on fiscal grounds. A
spokesperson said the governor had no official position on the research.

The campaign may cost as much as $20 million. California ballot initiatives are typically influenced by heavy TV
advertising in the weeks leading up to the vote, and advertising costs are expected to be particularly high this year
due in part to the national election.

Under the Microscope

1998: Researchers first extract stem cells from human embryos

1999: First successful human transplant of insulin-making cells from cadavers

2001: President Bush restricts federal funding for embryonic stem-cell research

2002: Juvenile Diabetes Research Foundation International creates $20 million fund-raising effort to support stem-cell
research

2004: Harvard researcher grows stem cells from embryos using private funding

SOURCE: The Wall Street Journal / San Francisco Chronicle, CA
http://tinyurl.com/2mfyp

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