Approval blamed on ‘misunderstanding’

Cancer

ances in place.”

The 11 members of the agency’s oversight committee agreed Wednesday to review Gimson’s per- formance behind closed doors at their January meeting, debated employing a consultant and, for the first time, said they will begin asking for information about applicants that might identify conflicts of interest.

The public meltdown of the agency comes just weeks before the Legislature convenes and after the agency has dispensed almost $841 million in 502 grants over the past threeand-half years. In 2007, Texas voters approved $3 billion in bonds to finance a 10-year effort to find cancer cures and treatments. Lawmakers are already discussing changes to ensure the public’s trust in the tiny state agency, which is the nation’s second-largest source of money for cancer research.

“It’s personally embarrassing,” said Jimmy Mansour, an Austin businessman who chairs the agency’s oversight committee. “I don’t understand how grants that should have been reviewed ended up in front of us.”

Gimson tried to assure him: “I’m confident that all the checks and balances have been put in place so this will never happen again.”

He said the Peloton application began in May or June of 2010 with a phone call to Dr. Alfred Gilman, a Nobel laureate and the agency’s chief science officer at the time. Gimson said a 27-page business plan to develop anticancer drugs was emailed to the agency, although he described Peloton as a “true startup” with no management in place at the time. Jerald “Jerry” Cobbs, the agency’s commercialization officer at the time, “improperly” put the Peloton application on a slate of applications for approval by the agency’s oversight committee, according to an internal audit.

The oversight committee approved the application, thinking it had been reviewed by business and scientific experts as required by the agency’s procedure.

Gimson said the application ended up on the agenda because of a “misunderstanding” between Cobbs and Gilman. He said he relied on Gilman and Cobbs, not realizing the application was never reviewed by experts.

Gimson said Peloton had other opportunities if it didn’t receive the grant that would allow it to relocate to Texas: “We wanted to act quickly so as not to lose the investment.”

The oversight might never have been discovered, however, except for another controversy.

Earlier this year, Gilman resigned because an application for a Houston incubator was reviewed by the commercialization group led by Cobbs but not by the scientific group that Gilman directed. A compliance officer hired in the wake of that flap reviewed the agency’s 13 commercialization grants and found that the Peloton application was approved without a review. Cobbs then resigned.

Gimson said he learned of the problem with the Peloton grant in early October, but he didn’t bring it to the oversight committee’s attention until last month — just days before it appeared in the news.

“My intent was always to bring this to the board,” Gimson said. “I wanted to bring a solution with the problem.”

The solution was to have Peloton reapply for the grant, even though $3.2 million of the $11 million had already been given to the company.

Gimson said he didn’t want to “prejudice” Peloton’s application before it had completed the review process. The company reapplied Nov. 15.

Tom Luce, a retired Dallas lawyer who has been on the agency’s oversight committee for only a couple of months, pressed for the closeddoor review of Gimson’s performance.

Luce said he wasn’t questioning Gimson’s motives or intentions, but he said the board has to have confidence in the agency’s leadership.

“Frankly, I don’t have that (confidence) anymore,” Luce said. “If there are mistakes of this nature, we should know