Scott King:

Many people have asked me why the JDF has not funded Islet Sheet Medical. Well, we asked them in the summer of 1999 whether they could. They said they could and invited us to submit a grant application. JDF suggested we submit a budget of $400,000. We prepared a proposal, but in January of 2000 they rejected it. ( Click here to read more about this; you can find links to our application and JDF's reasons for rejecting our application.) The process they use to evaluate grants is called peer review. How does it work? Why did they deem ISM's proposal as unworthy of funding?

Peer review is quite different from the process investors use to make a decision to invest. (All of our funds have come from investors.) The company's business plan must grab the attention of the investor and convince him that company technology, management and market potential are exceptional. A successful plan review leads to a meeting. (There is not a venture investor on earth that would invest without meeting management!) At that meeting the company and the investors discuss every issue that concerns the investors. Usually the investor will retain an expert consultant, who may spend many hours interviewing the company. Moving on to the next meeting -- and perhaps eventually to negotiation of investment terms -- is not just a matter of coming up with good answers to the questions. Both parties are sizing each other up, evaluating each other. Was that answer sincere? Why are they dismissing that competitor? Are there holes in the story? At bottom, you are asking yourself, do I really trust this person and want to work with him for years?

Peer review is anonymous and usually does not involve oral communication. The JDF has a panel of reviewers. The proposal must be written in a certain format: Click here to read a description of the format JDF requires (or click here to download the actual form). Two members of the panel read the proposal then produce a brief evaluation of the proposal's strengths and weaknesses. Although the applicant is given these comments, the identity of the reviewers remains anonymous. Then the panel as a whole decides whether to fund.

The reviewers have a short time to absorb a lot of information, some of it, by definition, unfamiliar to them. As a result they can misunderstand the proposal. Since the reviewers have no opportunity to ask the applicant questions, their conclusions can be based on misunderstandings that could be easily corrected with a conversation.

Another problem is that the reviewers know the identity of the applicant. They also know that the odds are that the applicant will some day be on a different panel and will review a proposal from the reviewer! This fact leads to a higher valuation placed on proposals by researchers well known in their fields. Most people think the system favors entrenched (or, if you prefer, established) researchers over ones new to the field.

Click here to see ISM's proposal and the two anonymous reviews. The reviewers (whose names, recall, we don't know) wrote some really wacky things. For example, Reviewer 1 wrote "The packed mass of tissue may consume more oxygen per surface area. There is a major need for modeling in this area, concerning glucose and insulin mass transfer, but also oxygen, before going to in vivo experiments in rats, and certainly before experiments in large animals."

Our proposal includes this section:
Oxygen flux
Like most bio-artificial pancreases, the Islet Sheet relies on passive diffusion for delivery of oxygen as well as glucose and other nutrients. Dionne, et al have studied the oxygen requirement for islet function. These investigators find hypoxia reduces insulin secretion of islets in a reversible fashion. A partial pressure of 27 mm Hg halves the secretion rate relative to normoxic arterial pO2, 80 mm Hg. The pO2 of most appropriate implant sites is lower, and likely close to the pO2 of venous blood, 40 mm Hg. Therefore reducing the barrier to oxygen diffusion is critical to success of the bioartificial pancreas.

The high density of islet tissue necessary for a device of practical size demands particularly high oxygen flux. Models of oxygen diffusion through membranes predict a rapid drop in pO2 from the surface. Based on the Colton/Avgoustiniatos model, alginate capsules must be less than 400 micrometer in diameter to sustain islet function when implanted in the peritoneal cavity. We have successfully fabricated Islet Sheets with an overall thickness of 250 micrometer, or a maximum diffusion length of 125 micrometer. One specific aim of this proposal is to determine the maximum density of islet tissue that will remain functional within the sheet following implantation.
This raises the question of whether Reviewer 1 actually read the proposal.

Probably the most peculiar question was how two centers could effectively collaborate:

(Reviewer 2) "There are two research centers -- one in San Francisco, the other in Cincinnati -- that are rather distant from one another, and it is difficult to get a clear understanding of what, by whom, and where the experiments will be conducted. For instance, by whom and where will the device be tested in vitro? Who and where will the devices be loaded for use in Cincinnati? Plans to address concerns about logistic and transfer problems should have been presented."

The proposal described how we already shipped islets and sheets between San Francisco and Chicago.
"Islets were isolated [at the University of Chicago] from two mongrel canines by standard partial pancreatectomy, collagenase digestion and Ficoll gradient purification. The isolated islets were then shipped in standard RPMI culture medium to Islet Sheet Medical's research laboratory in San Francisco. The islets were encapsulated into Islet Sheets and returned to Chicago for implantation less than 48 hours after isolation."
Shipping islets from Chicago to San Francisco would not seem to be much different from shipping islets from Cincinnati to San Francisco. Perhaps Reviewer 2 wants us to study the merits of FedEx versus UPS!

On the plus side, both reviewers recognized the importance of the approach:

(Reviewer 1) "Major relevance to the treatment of Type 1 diabetes."
(Reviewer 2) "A significant potential for the treatment of IDDM can be envisaged."

I have been working 20 years to find the cure for diabetes, and I am fortunate to have had a good scientific education to help me understand the many scientific and technical challenges. In my opinion transplantation of islets of Langerhans is the most promising path to the cure. And of the various approaches, the most promising programs are at the University of Alberta (improved immune suppression) and at Islet Sheet Medical (no immune suppression with encapsulation of islets). The JDF has provided no funds to either project. And the goal of the JDF is to cure diabetes. It seems to me that the JDF process is flawed.

So why does the JDF use the anonymous peer method to allocate their funds? Why don't they rather use the method of investors, and meet with new researchers who have new ideas face-to-face for some give-and-take? If they did, I think they would get a lot more from the research they fund.

Scott R. King

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