BILL ANALYSIS Ó
SB 115
Page 1
Date of Hearing: July 8, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
SB 115
(Fuller) - As Amended April 20, 2015
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill appropriates $1 million from the GF to the California
Department of Public Health (CDPH) for the 2015-16 fiscal year
(FY), for purposes of valley fever vaccine research in
accordance with current law describing the vaccine research
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program, and requires $100,000 to be allocated to DPH in the
2015-16 FY for administrative costs.
FISCAL EFFECT:
$1 million from the GF to CDPH for the specified purposes,
$100,000 of which would be used for CDPH administrative cost.
The balance would be used to contract for distribution of
research grants.
Current law specifies that funding is provided on the condition
that, if a valley fever vaccine is developed and successfully
marketed, the state shall be reimbursed for the research grants
made, in proportion to the state's contribution to the research
and development effort. Although it does not seem likely that a
vaccine will be developed soon, if this occurred, the state
could benefit financially based on this statute in proportion to
its overall investment of approximately $10 million over the
last two decades.
COMMENTS:
1)Purpose. This bill aims to provide state funding to renew
interest in finding a valley fever vaccine; previous research
efforts stalled due to lack of funding.
2)Background. Research on treatment and a possible vaccine for
valley fever, a respiratory disease caused by inhaling dust
containing certain disease-causing fungal spores, is
floundering. Valley fever is considered an orphan disease,
meaning it affects fewer than 200,000 people worldwide. The
spores are endemic to the southwest United States and
California's southern Central Valley is particularly affected.
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The Valley Fever Vaccine Project (VFVP) was funded by the
state from 1997 through 2003, and received two more years of
funding state funding in 2006-07 and 2009-10. Through a
combination of funds from the state, the California HealthCare
Foundation (CHCF), and other donors, the VFVP funded research
projects for developing and conducting trials on potential
valley fever vaccines. Total funding reached about $16
million. The program has not been funded since 2009-10.
3)Prior legislation.
a) AB 1955 (Ashburn) of 2002, SB 1027 (Ashburn) of 2003 and
SB 492 (Ashburn) of 2005 were substantially similar to this
bill. AB 1955, SB 1027 and SB 492 were held on the
Assembly Appropriations Committee suspense file.
b) SB 1044 (Fuller) of 2014 appropriated $1 million from
the GF for FY 2014 15, for purposes of extending the VFVP.
SB 1044 was referred to the Budget and Fiscal Review
Committee but never acted upon.
4)Staff Comments.
a) Past efforts to develop a valley fever vaccine have run
into significant hurdles. Drug development is inherently
risky, and it seems safe to assume vaccine development
would be at least a multi-year, multimillion dollar effort.
Thus, it is unclear to what extent this proposed
appropriation would further the development of a vaccine in
practical terms. The committee may wish to consider how
this funding fits in to an overall plan to further the
development of a vaccine for valley fever. At the least,
the committee may wish to consider whether any funding
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offered by the state could require matching non-state
public or private funds in order to gain the maximum
benefit from the appropriation.
b) As noted above, existing law requires if a vaccine is
developed, the state to be reimbursed for the cost of
grants made, in proportion to the state's contribution to
the research and development effort. Given the funding has
not been allocated since 2010, this requirement may be
outdated and may have the potential to discourage
investment in vaccine by posing a risk that the vaccine
developer would have to reimburse the state, threatening
any already meager profits that may be gained by producing
a vaccine. In addition, it is unclear how this provision
would be operationalized. The committee may wish to
consider whether this provision is still appropriate given
the challenging financial incentives that apply to vaccine
development.
Analysis Prepared by:Lisa Murawski / APPR. / (916)
319-2081