AUSTIN, Texas (AP) — Key lawmakers demanded answers Friday on why Texas' troubled $3 billion cancer-fighting agency gave $11 million in taxpayer funds to a biomedical company without scrutinizing the merits of the proposal.
It's the second time this year the Cancer Prevention and Research Institute of Texas has acknowledged that a project wasn't fully vetted before receiving a lucrative award. But the agency's improper grant to Peloton Therapeutics Inc., which was revealed Thursday, has reaped the most publicly stated concerns yet from state leaders.
CPRIT has doled out more than $700 million in taxpayer funds, making the state-run agency home to the nation's largest pot of cancer research dollars next to the federal National Institutes of Health.
The two Republicans who filed the bill creating the groundbreaking agency in 2007, state Sen. Jane Nelson and Rep. Jim Keffer, said they want a written explanation as to how Peloton's application was approved despite never going through the required peer-review process.
"CPRIT cannot succeed in its effort to fight cancer without the public's trust, and right now that trust is in serious jeopardy," the lawmakers wrote in a joint letter sent to the agency Friday. They asked the institute for a "prompt" response.
Gov. Rick Perry's office echoed their letter. Josh Havens, a Perry spokesman, said the governor expects the agency to apply rigorous review standards and that lawmakers and the public "deserve to have the full background of this situation."
James Mansour, whom Perry appointed chairman of the CPRIT's oversight committee, has also asked the agency for a detailed report that will spell out steps "to ensure this will never happen again."
It was Mansour's committee — entirely made up of members appointed by Perry, Lt. Gov. David Dewhurst and Speaker of the House Joe Straus — that ultimately approved the award in 2010. Mansour, however, said grants recommended for approval are presented in summary form and do not contain peer-review documentation or scores.
Peloton's proposal would have been submitted by Jerry Cobbs, the agency's chief commercialization officer. Cobbs announced his resignation earlier this month, and his last day was Friday. Attempts to reach him have been unsuccessful.
Peloton executives have declined comment and referred questions to CPRIT. The agency declined comment Friday.
CPRIT announced Thursday that irregularities surrounding the Peloton contract were discovered during an internal audit, but said the Dallas-based company was unaware that "CPRIT processes had not been followed."
Peloton's funding has been halted and the company's application is undergoing a second review, according to CPRIT.
Agency leaders have sought to emphasize that the lapses surrounding Peloton's contract were only uncovered after CPRIT's internal audit. CPRIT said that review did not uncover problems with any other commercialization awards.
Executive Director Bill Gimson said in a statement that the review was initiated "in the effort to be transparent and ensure good stewardship."
The agency initiated the audit in wake of intensifying scrutiny following the resignation of Dr. Alfred Gilman, a Nobel laureate who served as CPRIT's first chief scientific officer. He stepped down following approval of a $20 million award that never received a full scientific review and was only six pages long.
The money was for a so-called incubator project at M.D. Anderson Cancer Center in Houston, one of the country's top research institutes. Inflammatory internal emails later released by the agency included one from Gilman, in which he wrote, "I told Gimson this was the bomb that would destroy CPRIT."
Dozens of the agency's outside peer-reviewers resigned alongside Gilman, one of whom accused the agency of "hucksterism." The resignation letters of others expressed concerns of politics playing a bigger role in funding decisions than science.
Gimson has denied those accusations. He has said the type of proposal M.D. Anderson submitted did not require a scientific review under the agency's former rules, but has conceded missteps in how the application was handled.
"Mistakes occur at every agency," Nelson and Keffer wrote in their letter. "But CPRIT's mission is too important to be de-railed by lapses in the process established by law and by rules to ensure that every dollar allocated goes through a rigorous review process."
Follow Paul J. Weber on Twitter: www.twitter.com/pauljweber