An $11 million grant at the center of the controversy surrounding the state’s cancer agency would likely be reconsidered for full funding if the Dallas startup, Peloton Therapeutics, receives a favorable review and is not implicated in the criminal investigation, an agency official said Tuesday.
Wayne Roberts, interim executive director who inherited the problems at the Cancer Prevention and Research Institute of Texas, made his comments at a hearing before the House Committee on Public Health and in an interview afterwards.
The previous leadership at the agency — commonly known as CPRIT — approved the $11 million grant without the required scientific and business reviews, which wasn’t discovered by the agency for two years. CPRIT had advanced Peloton the first $3.2 million of the grant before the problem was disclosed publicly.
The Travis County district attorney’s office is conducting a criminal investigation into the mishandling of three of the agency’s almost 500 grants, totaling $56 million, including the Peloton grant.
Prosecutors have been collecting evidence for months and Gregg Cox, chief of the Public Integrity Unit at the Travis County district attorney’s, said Tuesday that they would begin presenting evidence and witnesses to a grand jury this month.
The evidence includes emails between CPRIT executives, who have since resigned, about the Peloton grant.
Peloton had reapplied for funding last fall — before the problem was disclosed publicly — but its second application was frozen by the state leadership in December, along with other pending grants.
Despite months of media and legislative attention, plus a critical state audit, it remains unclear why CPRIT executives recommended that the Peloton grant be approved — without the required reviews — and then kept quiet about it for two years.
“Peloton — for reasons we don’t understand — didn’t get the appropriate reviews,” Roberts said.
He said Pelton is a “viable” organization that has attracted private investment but still needs CPRIT funding.
“Until the DA is through with the investigation, we’d have to wait,” Roberts said.
He said Peloton’s second application would go through the required reviews once state leaders lift the moratorium on the grant process.
“I don’t know whether they’d win out or not,” Roberts said of Peloton. “I’d assume we’d take the peer review’s recommendation without prejudice.”
He said the agency has not asked Peloton to return the $3.2 million, pending the results of the criminal investigation and any subsequent review by the agency’s scientific panel of experts.
Roberts’ comments came as the House committee heard testimony about Senate Bill 149 that attempts to strengthen safeguards against abuses of the process.
State Rep. Jim Keffer, an Eastland Republican and House author, said the bill creates more checks and balances, strengthens conflict of interest rules, adds trained patient advocates to the review process and limits the terms of the oversight committee members appointed by Gov. Rick Perry and legislative leaders.
The biggest difference between the House and Senate versions is that Keffer’s bill would eliminate the foundation that accepted donations to supplement the salaries of CPRIT’s top two executives.
Many lawmakers have said they viewed that as at least raising the perception of donors influencing the grant process.
Keffer urged the committee to keep the agency’s problems in perspective.
“There was never anybody feathering their nest,” he said. “It was overzealousness and high-handedness, I guess.”
The controversy has damaged the reputation of CPRIT, which voters authorized in 2007 to spend $3 billion in bonds to fight cancer with prevention, research and commercialization grants.
The Legislature has not yet acted on restoring the agency’s $300 million annual appropriation.
Roberts said he wants to add eight additional positions, including an internal auditor, to the two dozen employees who run the program. He said the agency is understaffed for making sure the grants are spent as intended.
“When you’re awarding $300 million a year,” he said, “I want more than a couple of people out there.”
Several supporters of CPRIT also testified Tuesday, including cancer survivors, medical specialists and grant recipients, urging the Legislature to resume CPRIT’s funding.
Many of them wore lapel buttons: “Save CPRIT/Save Lives.”