BILL NUMBER: SB 1565 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JULY 14, 2008
AMENDED IN ASSEMBLY JUNE 9, 2008
AMENDED IN SENATE APRIL 16, 2008
INTRODUCED BY Senators Kuehl and Runner
(Coauthor: Senator Wiggins)
(Coauthor: Assembly Member Jones)
FEBRUARY 22, 2008
An act to amend Section 125290.60 of, and to add Section 125293
to, the Health and Safety Code, relating to reproductive health.
LEGISLATIVE COUNSEL'S DIGEST
SB 1565, as amended, Kuehl. California Stem Cell Research and
Cures Act.
The California Stem Cell Research and Cures Act (the act), an
initiative measure approved by the voters at the November 2, 2004,
statewide general election as Proposition 71, establishes the
California Institute for Regenerative Medicine (CIRM), the purpose of
which is, among other things, to make grants and loans for stem cell
research, for research facilities, and for other vital research
opportunities to realize therapies, protocols, and medical procedures
that will result in the cure for, or substantial mitigation of,
diseases and injuries. Existing law establishes the Independent
Citizen's Oversight Committee (ICOC) composed of appointed members,
that is required to perform various functions and duties with regard
to the operation of the institute, including, but not limited to,
establishing standards applicable to research funded by the
institute. Existing law prohibits amendment of Proposition 71 by the
Legislature unless the amendment is approved by the voters, or the
amendment is accomplished by a bill introduced after the first 2 full
calendar years and approved by a vote of 70% of both houses, and
only if the amendment enhances the ability of the institute to
further the purposes of the grant and loan programs.
The act provides that the ICOC shall establish standards that
require that all grants and loan awards under the act shall be
subject to intellectual property agreements that balance the
opportunity of the state to benefit from the patents, royalties, and
licenses that result from basic research, therapy development, and
clinical trials with the need to assure that essential medical
research is not unreasonably hindered by the intellectual property
agreements.
This bill would require that intellectual property standards that
the ICOC develops shall include a requirement that each grantee and
the licensees of the grantee submit to the CIRM for approval a plan
that will afford uninsured Californians access to any drug that is,
in whole or in part, the result of research funded by the CIRM, and
would require that any plan subject to that approval shall require
that the grantees and licensees thereof sell
provide drugs at a price that does not exceed any
benchmark price to publicly funded programs in
California at one of the three benchmark prices in the
California Discount Prescription Drug Program , except when the
ICOC adopts a waiver, as specified .
The act provides that the CIRM shall have 3 separate scientific
and medical working groups, including the Scientific and Medical
Research Funding Working Group, which, among other things, shall make
grant and loan award recommendations to the ICOC. Existing
Existing law provides that, in order to ensure CIRM
funding does not duplicate or supplant existing funding, certain
research categories shall not be funded by the CIRM, except when at
least 2/3 of a quorum of the members of the Scientific and Medical
Research Funding Working Group recommend to the ICOC that such a
research proposal is a vital research opportunity.
This bill would, instead, only require a simple majority of a
quorum of the members of the Scientific and Medical Research Funding
Working Group to recommend to the ICOC that a particular research
proposal is a vital research opportunity.
Existing law establishes the Milton Marks "Little Hoover"
Commission on California State Government Organization and Economy, a
multimember body appointed by the Governor and the Legislature with
various duties that include making recommendations to the Governor
and the Legislature to promote efficiency in government operations.
This bill would request the commission to conduct a study of the
governance structure of the California Stem Cell Research and Cures
Act. This bill would provide that if the commission conducts the
study, it shall, by July 1, 2009, submit, to the appropriate
committees of each house of the Legislature, a report on the results
of the study and recommendations of ways the governance structure of
the ICOC could better ensure public accountability and reduce
conflicts of interest, consistent with the purposes of Proposition
71, and would require the commission to make the report available to
the public.
Vote: 70%. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 125290.60 of the Health and Safety Code is
amended to read:
125290.60. Scientific and Medical Research Funding Working Group
(a) Membership
The Scientific and Medical Research Funding Working Group shall
have 23 members as follows:
(1) Seven ICOC members from the 10 disease advocacy group members
described in paragraphs (3), (4), and (5) of subdivision (a) of
Section 125290.20.
(2) Fifteen scientists nationally recognized in the field of stem
cell research.
(3) The Chairperson of the ICOC.
(b) Functions
The Scientific and Medical Research Funding Working Group shall
perform the following functions:
(1) Recommend to the ICOC interim and final criteria, standards,
and requirements for considering funding applications and for
awarding research grants and loans.
(2) Recommend to the ICOC standards for the scientific and medical
oversight of awards.
(3) Recommend to the ICOC any modifications of the criteria,
standards, and requirements described in paragraphs (1) and (2) above
as needed.
(4) Review grant and loan applications based on the criteria,
requirements, and standards adopted by the ICOC and make
recommendations to the ICOC for the award of research, therapy
development, and clinical trial grants and loans.
(5) Conduct peer group progress oversight reviews of grantees to
ensure compliance with the terms of the award, and report to the ICOC
any recommendations for subsequent action.
(6) Recommend to the ICOC standards for the evaluation of grantees
to ensure that they comply with all applicable requirements.
Such These standards shall mandate
periodic reporting by grantees and shall authorize the Scientific and
Medical Research Funding Working Group to audit a grantee and
forward any recommendations for action to the ICOC.
(7) Recommend its first grant awards within 60 days of the
issuance of the interim standards.
(c) Recommendations for Awards
Award recommendations shall be based upon a competitive evaluation
as follows:
(1) Only the 15 scientist members of the Scientific and Medical
Research Funding Working Group shall score grant and loan award
applications for scientific merit. This scoring shall be based on
scientific merit in three separate classifications--research, therapy
development, and clinical trials, on criteria including the
following:
(A) A demonstrated record of achievement in the areas of
pluripotent stem cell and progenitor cell biology and medicine,
unless the research is determined to be a vital research opportunity.
(B) The quality of the research proposal, the potential for
achieving significant research, or clinical results, the timetable
for realizing such significant results, the importance of the
research objectives, and the innovativeness of the proposed research.
(C) In order to ensure that institute funding does not duplicate
or supplant existing funding, a high priority shall be placed on
funding pluripotent stem cell and progenitor cell research that
cannot, or is unlikely to, receive timely or sufficient federal
funding, unencumbered by limitations that would impede the research.
In this regard, other research categories funded by the National
Institutes of Health shall not be funded by the institute.
(D) Notwithstanding subparagraph (C), other scientific and medical
research and technologies and/or any stem cell research proposal not
actually funded by the institute under subparagraph (C) may be
funded by the institute if at least a simple majority of a quorum of
the members of the Scientific and Medical Research Funding Working
Group recommend to the ICOC that the research proposal is
a vital research opportunity.
(E) By making the changes to subparagraph (D) by the act adding
this subparagraph, the Legislature affirms that the underlying
purpose of the ICOC and the institute is to give priority to stem
cell research that has the greatest potential for development of
therapies and cures.
SEC. 2. Section 125293 is added to the Health and Safety Code, to
read:
125293. (a) The intellectual property standards that the ICOC
develops shall include a requirement that each grantee and the
licensee of the grantee submit a plan to the California Institute for
Regenerative Medicine (CIRM) that will afford uninsured Californians
access to any drug that is, in whole or in part, the result of
research funded by the CIRM.
(b) The ICOC shall require submission of the plan required by
subdivision (a) before a drug is placed into commerce. The plan shall
be subject to the approval of the CIRM, after a public hearing and
opportunity for public comment.
(c) (1) Any plan subject to subdivision (a) shall include a
requirement that each grantee and any licensee of the grantee that
sells drugs that are, in whole or in part, the result of research
funded by CIRM and that are purchased in California with
public funds shall sell those drugs at a price that does not exceed
any benchmark price in the California Discount Prescription Drug
Program by CIRM shall provide those drugs to publicly
funded programs in California at one of the three benchmark prices in
the California Discount Prescription Drug Program (Division
112 (commencing with Section 130500)), as it exists on January 1,
2008.
(2) Paragraph (1) shall not preclude any public agency from
obtaining prices that are lower than the price determined as
described in paragraph (1) through negotiation, bulk purchasing, or
any other purchasing arrangement and shall not be construed to
conflict with, or preempt, any other provision of state or federal
law or regulation that would result in lower drug prices.
(d) For purposes of this section, "drug" includes any article
recognized in the United States Pharmacopeia or supplement thereof,
the National Formulary, or any supplement thereof, and any article
intended for the diagnosis, cure, mitigation, or prevention of
disease in humans or animals, or any article intended for use as a
component thereof, and shall include therapeutic products, including,
but not limited to, blood, blood products, cells, and cell
therapies.
(e) Notwithstanding subdivision (c), the ICOC may waive the
requirement that grantees and licensees of the grantee provide drugs
that are, in whole or in part, the result of research funded by CIRM
at one of the three benchmark prices in the California Discount
Prescription Drug Program (Division 112 (commencing with Section
130500)), as it exists on January 1, 2008, only when the following
conditions are met:
(1) Either of the following conditions is met:
(A) The drug shall be used for the diagnosis, cure, mitigation, or
prevention of a rare disease or condition, as recognized by the
federal Food and Drug Administration under Section 360bb of Title 21
of the United States Code, by individuals who would not otherwise
have access to the drug through private insurance or public programs,
the number of individuals who will have increased access to the drug
represent a significant proportion of the individuals in California
who have that rare disease or condition, and the ICOC has made a
determination that, in the absence of the waiver, development of the
drug will be impeded.
(B) The grantee commits, in writing, to provide expanded access to
a drug under its access plan to a class of patients who would not
otherwise receive access to the drug, including working uninsured
individuals who do not qualify for any public program or private
health plan or policy that provides coverage of the drug and the ICOC
has made a determination, before granting a waiver and based on the
number of individuals who will have access to the drug and the likely
costs of the drug, that the waiver will provide significant benefits
that equal or exceed the benefits that would otherwise accrue to the
state through the pricing requirements set forth in subdivision (c).
(2) The ICOC has conducted a public hearing prior to adopting any
waiver pursuant to this subdivision. The ICOC shall provide findings
and declarations and documentation to the Legislature substantiating
the need for, and the benefits of, a waiver adopted pursuant to this
subdivision at least 30 days prior to the public hearing and shall
post these documents on its Internet Web site at the time of
submission to the Legislature and provide notice to the public that
these documents have been posted.
SEC. 3. (a) The Legislature hereby requests the Milton Marks
"Little Hoover" Commission on California State Government
Organization and Economy to conduct a study of the governance
structure of the California Stem Cell Research and Cures Act, an
initiative measure approved by the voters at the November 2, 2004,
statewide general election (Proposition 71), including the membership
of the Independent Citizen's Oversight Committee and the relative
roles of the committee and the California Institute for Regenerative
Medicine.
(b) If the commission conducts the study described in subdivision
(a), the commission shall, by July 1, 2009, submit to the appropriate
committees of each house of the Legislature, a report on the results
of the study requested by subdivision (a) and recommendations of
ways the governance structure of the Independent Citizen's Oversight
Committee could better ensure public accountability and reduce
conflicts of interest, consistent with the purposes of Proposition
71. The commission shall make the report available to the public.