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Texas Voters Approve $3B Plan to Revitalize Cancer R&D Momentum, Recruit Specialists

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Texas voters last week approved issuing a $3 billion bond intended to fund cancer research, attract the field’s top researchers to the state, and expand the state’s concentration of research hospitals into a broader public-private life-sciences cluster designed to fight the disease.
 
By a 61 to 39 percent margin — 668,543 to 419,709, according to unofficial results from the Texas Office of the Secretary of State — Texas voters on Nov. 6 approved Gov. Rick Perry’s referendum to amend the state constitution and create a new Cancer Prevention and Research Institute.
 
The Institute would distribute the $3 billion in $300 million tranches each year for 10 years to public and private educational institutions and medical research facilities. Recipients would have to match what they receive, which could translate to a total state-wide windfall of $6 billion for cancer research.
 
The institute will also carry out the Texas Cancer Plan, five goals described in a 100-page document intended to guide the state’s policies for cancer prevention and control. Completed in 2005, the cancer plan offers goals as well as the steps the state needs to take to better prevent, detect, and treat cancer, and to educate healthcare professionals and improve data collection and survival.
 
The plan and the bond build on more than two decades of state involvement in fighting cancer, dating back to a 52-member Legislative Task Force on Cancer in Texas formed in 1984. A year later, the state created the current Texas Cancer Council, a state agency formed to promote public-private efforts toward cancer prevention, treatment, and awareness.
 
The council, which developed the $3 billion cancer plan, will be folded into the resulting institute, And though the referendum sought to start building the institute as soon as voters approved the measure, known as Proposition 15, it will actually “take some time, though, to transition staff,” state Sen. Jane Nelson, Republican of Lewisville, told BioRegion News via e-mail last week.
 
Part of the holdup is that members of two key committees must still be appointed, said Nelson: A scientific research committee, which will review grant requests, and a committee charged with overseeing the institute’s operations.
 
The 11-member oversight committee members would serve four-year terms. The governor, the lieutenant governor, and the speaker of the House each would appoint three members, with the governor, the comptroller or their designees rounding out the panel membership.
 
“Once those bodies are in place, we can establish the system by which grants will be reviewed,” Nelson added.
 
30-Percent Boost
 
The $300 million annual windfall is almost 30 percent better than Texas institutions have been awarded for cancer research in federal grants and contracts through the National Cancer Institute in fiscal 2006, the most recent year for which figures are available.
 
NCI spokesman Anthony Beal told BioRegion News last week via e-mail that the agency spent about $232.96 million in FY 2006 on grants and contracts for Texas researchers, up a fraction of a percent from the $232.34 million it set aside for the same period the previous year.
 
The cancer dollars were part of an overall roughly $1.08 billion the National Institutes of Health awarded Texas researchers during the federal fiscal year ending Sept. 30, 2006. Top winners were Baylor College of Medicine in Houston, which saw $221.8 million; followed by the University of Texas Southwestern Medical Center in Dallas, which recorded $158.7 million; and UT’s MD Anderson Cancer Center in Houston, which grew richer that year by $148.4 million.
 
“We have been ranked third in the nation in research and development in our academic institutions. We’re not third in the nation as far as the commercialization of that research” — the state was actually ranked No. 6, tied with Ohio, for number of startups (18) formed by universities in the 2005 Association of University Technology Managers Survey released in February — “but that’s what we’re attempting to do here,” said Jacqueline Northcut, CEO of 150-the member BioHouston. Its members include the region’s 130 biotech, pharmaceutical, and medical-device businesses.
 
To be sure, the number of those businesses has doubled over the past four years, Northcut said, reflecting the growth of research activity experienced at institutions like Baylor Medical and MD Anderson. She said the state has helped by approving subsidy programs such as its Emerging Technology Fund, which spends $200 million every two years to support early-stage companies in life sciences and other tech specialties.
 
Building Support
 
Perry, a Republican re-elected last year with just 39 percent of the vote, spent much of the past year building public support for the measure, in tandem with leaders from the state’s far-flung life science industry, research centers and other officials.
 
“We worked diligently to educate voters about this issue, but we found that it didn't need a hard sales pitch,” Nelson told BRN. “Every Texan is affected by cancer — either directly, through a loved one or by the $30 billion impact it has on our state every year. There was a built-in coalition of support for Proposition 15.”
 
Yet Perry kept the cancer research effort through a key decision made earlier this year, when disagreement over how to pay for the bond issue threatened to derail the coalition. Perry originally planned to pay for the cancer referendum by using part of the proceeds from selling the state lottery system to a private operator, a move he had projected would yield the state $14 billion in new revenues.
 
Along with the proceeds, the governor projected such a sale would yield $1.3 billion in annual interest, or $300 million more than the lottery’s annual revenue in recent years. In addition to the cancer fund, Perry envisioned using another $2.7 billion of lottery proceeds toward a fund to help state residents buy health insurance, and the remaining $8 billion to establish a fund for public schools, strictly by spending the $800 million in annual interest the fund was projected to generate.
 

“We worked diligently to educate voters about this issue, but we found that it didn't need a hard sales pitch.”

Perry quickly dropped the lottery sale after legislators balked at it, reasoning that the longer they held on to it, the more they could gain for the program. The governor agreed to fund the research through a more conventional bond issue.
 
But when state senators added an amendment from Troy Fraser, Republican of Horseshoe Bay, requiring that the legislature approve funding for the cancer institute ever two years, Perry briefly resurrected the lottery plan; his legislative director contended that the amendment would lower the value of the bonds. But Perry backtracked again, abandoning the lottery idea after state senators convinced the governor that removing the amendment would delay and perhaps kill the cancer bill by forcing the state Senate and House to resolve the issue through a conference committee.
 
A conference committee approach was especially risky this past spring because the Texas House of Representatives was nearly crippled in the closing days of the 80th Legislature session by an attempt by some lawmakers to unseat three-term Speaker Tom Craddick, a Republican from Midland. The House eventually approved the cancer bill, sending it to the November ballot along with 15 other propositions requiring voter approval.
 
The House revolt notwithstanding, the relative ease with which both houses of the Texas legislature approved the cancer funding contrasted with the rejection by New Jersey voters of a $450 million bond issue to fund stem-cell research [See story, this issue].
 
Unlike in the Garden State, Proposition 15 supporters distanced themselves from the embryonic stem-cell controversy. Only one group opposed to the cancer bond, the Texas Eagle Forum, noted that it did not ban the use of embryonic stem cells in cancer research. Perry responded publicly by restating his opposition to embryonic stem cells, while other proponents said they would not be necessary in conducting the research envisioned by the $3 billion bond act.
 
Two other groups, the Harris County Republican Party and the Texas Public Policy Foundation, cited the $1.6 billion in additional state debt the bond issue would produce in opposing the measure.
 
“Many medical and charitable organizations already exist across the nation that provide for cancer research, that are funded by private donations, charities and foundations,” the Harris County GOP stated in a resolution against Proposition 15.
 
The institute will issue $300 million worth of general-obligation bonds each year over 10 years. Texas law permits recipients to use the cash to operate research programs, purchase laboratories or facilities, and for research grants, including research facilities.
 
Proceeds can also be used to pay the costs of issuing the bonds as well as any administrative expense related to them. Up to 5 percent of total grant awards can be used for facility construction, and not more than 10 percent for prevention and control programs.
 
Mary Katherine Stout, vice president of policy and director of the Texas Public Policy Foundation's Center for Health Care Policy Studies, told BioRegion News the cancer funding is an example of the scientific research activity her group believes is better carried out by private investors than by government.
 
“The better course of action would be to look for investment from the private sector rather than cancer bonds issued by the government,” Stout said. “We think the private sector will allocate those resources in a better way.”
 
Supporters of Prop 15 successfully countered that the bond money will help Texas institutions recruit top-tier researchers and advance the work of developing treatments.
 
Proponents cited state Department of Health statistics showing that each year about 95,000 Texans are diagnosed with cancer, and 35,000 die of the disease, making it the state’s second-leading cause of death — at an annual cost of around $4 billion.
 
To promote the bond issue, Perry assembled a coalition of elected officials from both parties; one key member was the state’s former comptroller John Sharp, a Democrat who has been publicly discussed as a candidate for governor or senator in 2010. Also part of the coalition was Lance Armstrong, the native Texan and seven-time Tour de France cycling champion who established an eponymous foundation to fund cancer research following his struggle with testicular cancer in 1996.
 
But the strongest advocate for the cancer funding, arguably, was Perry himself. The Texas governor had already made a name among cancer fighters earlier this year when he signed an executive order requiring all girls entering sixth grade to be vaccinated for human papillomavirus, a virus linked to cervical cancer. The order generated intense criticism of Perry among groups that argued it would encourage sexual activity among pre-teens, and called for any vaccination to be voluntary.
 
Perry defended his policy Feb. 6 as one meant to save lives, in a state of the state address that also introduced his cancer funding plan:
 
“I don't know when the day will come that we find a cure for cancer, but I do know it is my dream to accelerate its arrival with a multi-billion dollar cancer research initiative that can save lives and provide millions renewed hope,” Perry said.

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