StemCells, Inc., said today it has
applied for as much as $40 million in funding from the California
stem cell agency for two projects dealing with Alzheimer's disease
and cervical spinal cord injury.

The announcement came in a news release
dealing with the publicly traded firm's quarterly earnings. The applications are part of a $240 million round expected to be acted on in late July by the board
of the $3 billion California stem cell agency. Funding for
businesses in the disease team round is expected to come through a
loan.

StemCells, Inc., of Newark, Ca., said,

Applications in the round were reviewed
behind closed doors in April. CIRM also has a policy of not releasing the
names of applicants until its board acts and then only if an
applicant is approved. CIRM says it does not want to embarrass firms
that do not win approval. That includes individual researcher names
as well as the names of such institutions as the University of
California.

During discussion of grant applications by the CIRM board, directors are not told the names of the applicants,
just the number of the application. If board members have conflicts
of interest on specific applications, they are barred from voting on
and discussing the application. The names of applicants have
occassionally slipped out. Sometimes their identities can also be
discerned by information contained in the summaries of the reviews of
the applications, which become available on the CIRM web site shortly before the directors act. The summaries normally carry scientific scores and recommendations for funding.

Most companies seeking funding from
CIRM do not identify themselves in advance, although they do if they
appeal a negative decision by reviewers. The board has ultimate
authority for approval of grants but has almost never rejected a
recommendation for funding by reviewers.

StemCells Inc. was founded by Irv Weissman of Stanford, who sits on its board of directors. Weissman is also on its scientific advisory board along with Fred Gage
of Salk and David Anderson of Caltech. Weissman and Gage have won
substantial grants from CIRM. 

StemCells Inc.'s stock price closed at
92 cents yesterday. Its 52-week high was $8.20, and its 52 week low
was 70 cents.

Here is a link to an analyst's report
on the company.

(Editor's note: An earlier version of this item incorrectly stated that the disease team round will be acted on later this month.)