Biotech companies await Annapolis on stem cell funding

Wednesday, Dec. 7, 2005

Biotech company officials want to know just how serious Annapolis is about funding stem cell research.

A spokesman for Gov. Robert L. Ehrlich Jr. (R) recently said he is considering significant new capital funding for basic research facilities, ‘‘which may very well include stem cell experiments.”

Also, some lawmakers say they plan to introduce a new bill providing at least $25 million annually for certain kinds of stem cell research. The House approved that amount in the last session, but the bill died in the Senate.

The bill represents Maryland’s efforts to compete with other states that are in the forefront of funding for stem cell research. For example, California voters in a referendum approved borrowing $3 billion over 10 years for such endeavors.

A state contribution of $25 million a year isn’t much, said C. Randall Mills, president and CEO of the private stem cell research company Osiris Therapeutics Inc. of Baltimore.

‘‘We spend $30 million a year on stem cell research ourselves,” Mills said.

On the other hand, he said, ‘‘all that money in California is not going anywhere” — meaning the state won’t find enough ways to spend it all on stem cell work, he predicted.

But C. Robert Eaton, president of MdBio Inc., which promotes the state’s bioscience industry, said any support Annapolis can show for stem cell research ‘‘sends a good signal for Maryland” to other states and companies.

John W. Holaday, chairman of HarVest Bank of Maryland, agreed.

‘‘It is not the money as much as it means creating a positive environment,” said Holaday, a former executive with EntreMed of Rockville.

‘‘If the state supports stem cell research, it sends a signal that they are willing to support cutting-edge research,” he said, adding that the state does not support enough pure research.

Human stem cells have the capability to grow into healthy sources of new cells, tissues and organs. Scientists are studying them to find entirely new kinds of treatments and cures for heart disease, Alzheimer’s disease, multiple sclerosis, HIV⁄AIDS, Parkinson’s disease, diabetes, cancer, arthritis, injuries and other conditions.

State funding for stem cell research is a ‘‘great idea,” said Paul M. Silber, president and CEO of In Vitro Technologies Inc. in Baltimore, because it would help shore up Maryland’s slipping status as a biotech leader. In Vitro is not yet directly involved with stem cell research, he said, but provides products and research services to both the pharma and biotech companies.

‘‘We are seeing other states, Pennsylvania, New Jersey, Massachusetts, California, all gaining,” Silber said. Maryland ‘‘does have the intellectual horsepower. But there is a palsy of action at the state level. They better make hay while they can.”

Last year, New Jersey became the second state to fund stem cell research, including embryonic stem cell research.

Silber said that it is now well known in the larger biotech community that Maryland’s biotech centers are parochial, that there is even a ‘‘fair lack of cooperation within the university system, to everyone’s detriment.” If the legislature appropriates money for stem cell studies, Silber said, ‘‘everyone is going to be competing for those dollars in one way or not. Maryland could really do awful more to support its biotech industry.”

Allan K. Smith, president and COO of stem cell research company Cognate Therapeutics of Baltimore and Sunnyvale, Calif., said Maryland is in danger of losing its top talent to other states.

‘‘Generally, it is important to keep some of the people resources here in the state,” Smith said. Without more support from Annapolis, Maryland’s biotechs may be raided by those in other states. ‘‘There is some [raiding] going on for sure. Folks are being offered chances elsewhere,” he said.

Cognate ‘‘might be inclined” to shift some of its research from Sunnyvale to Baltimore is Maryland funds stem cell research, Smith said. ‘‘I think certainly if those funds are made available, depending on the specifics of a bill, that would open some doors,” he said.

Cognate’s researchers study primarily adult-source stem cells, Smith said. ‘‘I hope that that this new Maryland stem cell bill might include a broader array of stem cell work than last year, when that one focused on embryonic stem cells,” he said.

Montgomery County Executive Douglas M. Duncan (D) said such a bill would symbolize the state’s commitment to high technology, ‘‘but we need to do a lot more.”

Duncan, whose county boasts 150 biotech firms employing more than 11,500 people, said the legislature lost a big opportunity in the last session. ‘‘It means that gone is an entire year to advance this work,” he said. ‘‘Meanwhile, the state is slipping in biotech and other states are gaining ground and passing us.

‘‘We have lab space. We have facilities for work like stem cell research,” Duncan said. ‘‘What we need is research dollars.” He cited the recent case of Peter J. Donovan, a top Johns Hopkins stem cell scientist who left for the University of California, Irvine. ‘‘They had a brand new laboratory [at Johns Hopkins] for him and he could not do his work.”

Del. Samuel I. Rosenberg (D-Dist. 41) of Baltimore and Sen. Paula C. Hollinger (D-Dist. 11) of Baltimore are hammering out the bill they plan to introduce early in the coming session, which Senate Finance Committee Chairman Thomas McLain Middleton (D-Dist. 28) of Waldorf called ‘‘a big part of the leadership agenda.”

Last session’s bill addressed most of the concerns from the Maryland Catholic Conference and other concerned groups, Middleton said, by allowing funding for stem cell work only with embryos that would otherwise be discarded, with no funding for work on unfertilized eggs. Some groups oppose embryonic stem cell research because they believe extracting cells from a viable embryo is a destruction of human life.

Osiris’ Mills said he is waiting to see next year’s proposal.

‘‘Whether it will affect us is unknown because it depends on what form the bill takes,” he said. ‘‘I talked with some legislators involved with the bill last year after it was written and even they weren’t sure what was in it. If the bill this year includes adult stem cells, it may help.”

Osiris is developing a drug for targeting how the immune system affects specific organs, such as the heart, rather than the entire body, such as current drugs for AIDS or rheumatoid arthritis.

‘‘I would not be opposed to state funds,” Mills said. ‘‘Our mission is to get the first stem cell products on the market. The people we treat are very, very sick.”

MdBio’s Eaton is concerned with how the state would distribute the research funds.

‘‘The question is, How much will it cost to put in the infrastructure to do stem cell research?” Eaton said. ‘‘For example [the National Institutes of Health] has a peer review system. Who here would get the money?”

Silber raised another concern.

‘‘No one is asking how [state stem cell funding] would conflict with the federal mandate” restricting embryonic stem cell studies, he said. ‘‘Would university researchers provide any conflict with their federal grants? Would it mean that university work with the funds would preclude their federal funding?”

Sen. Andrew P. Harris (R-Dist. 7) of Cockeysville, a physician, said most funding should come from the federal government, but states have a role to play, too.

‘‘Obviously the federal restrictions do not preclude private-funded research,” Harris said. ‘‘The whole question then is whether NIH will fund stem cell research.”

The current debate over embryonic stem cells may soon be moot, Harris said.

‘‘My position is that in two years we will not be talking about embryonic stem cell research, where the cells are taken from a human embryo,” he said. Even now, he said, ‘‘you can create an embryo that can’t grow to be a human” and use it for research.

This report originally appeared in The Business Gazette.