Gary Michelson, a 77-year-old former spine surgeon and prolific inventor, has put $120 million on the table to help build the California Institute for Immunology and Immunotherapy in Los Angeles. He co-founded and chairs the institute, which was formed in 2024, and says the public bond is meant to keep U.S. science moving as the Trump administration reduces federal research dollars.
He is not alone in bankrolling the project. Michelson and his wife, Alya, join co-founders committing a combined $250 million, among them financier Michael Milken and Facebook's first president, Sean Parker. The institute is slated to take space in a redeveloped former mall that UCLA is turning into a research park.
Michelson frames the bet as a public choice. "California's initiative system was created so that the voters could bypass the politicians and decide important priorities directly," he wrote. "There is no more important priority than preventing and curing fatal diseases. We trust the people of California with this decision." He also said, "I won't make a single dollar from Prop 38, quite the opposite," adding that he backs the measure to give "millions of others a chance to live longer, healthier lives."
Prop 38 would raise $8.4 billion through state bonds to fund immunology, which studies how the body defends itself, and immunotherapy, which uses that system to fight disease. The target list includes cancer, heart disease and Alzheimer's. Voters will decide on Nov. 3, with the measure one of 14 on the ballot.
There is no new tax in the proposal. Instead, the state would make payments from the general fund that also supports K-12 education, health care and other public programs. California's Legislative Analyst's Office estimates $500 million to $600 million a year in payments for about two decades. The measure requires that 10% of any revenue from funded discoveries flow back to the state to help cover principal and interest, though the analyst cautions that such income is uncertain and may take years or decades to arrive.
The statute does not name Michelson's institute. Even so, the eligibility rules - covering facilities, philanthropic support, and links with a University of California medical center - seem to exclude any other in-state institute, according to a CalMatters review. The Proposition 38 campaign argues the requirements are meant to anchor a world-class hub with the people, tools and clinical access to speed breakthroughs. The California Department of Public Health would make the final award.
Governor Gavin Newsom endorsed the bond this month, calling it a way to support lifesaving work and offset federal pullbacks. UCLA has been among the universities the Trump administration has targeted over allegations of antisemitism and discrimination. Michelson says the state effort would help sustain American research leadership amid those cuts.
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Not everyone is on board with the financing model. Stanford School of Medicine senior scholar Robert Kaplan, who previously served as an associate director at the National Institutes of Health, warns that "Taxpayers take all the financial risk," describing the approach as "putting all your eggs in one basket." He estimates therapies would need to generate about $120 billion in intellectual property to pay back an $8.4 billion bond if the state is recouping 10% of revenue, and he argues the plan could channel "perhaps $100 billion in intellectual property revenue to a small organization that's a creation of billionaires."
Kaplan points to California's earlier stem cell bond program, approved in 2004, which he says has returned roughly $16 million in royalties, less than 1% of the combined principal and interest. He also notes the new debt would land as other state services, including health care, contend with federal reductions.
State disclosure records show the Yes on 38 campaign has taken in $72 million, with $66.2 million contributed by Michelson. The No on 38 side reported around $9,000. In polling last month from the Public Policy Institute of California, 55% of likely voters supported the measure. The same survey found 52% backed a separate one-time 5% tax on billionaire wealth, largely for health care, while much of the campaign spotlight has centered on Proposition 40, the wealth tax question.
Support also comes from researchers squeezed by federal cutbacks. Jillian McCool lost a postdoctoral role in immunology and biology at Lawrence Livermore Laboratory after her grant was cut last year. Now studying bees at the University of California at Davis, she put it bluntly: "I hate billionaires, but if you want to spend money on science I'll take it."
In plain English: the financial payoff depends on whether public science turns into products. The measure directs 10% of resulting revenue to the state, but timelines are long and outcomes uncertain. Still, the broader field is moving. The 2025 Nobel Prize in medicine honored three scientists who identified regulatory T cells, the immune system's internal security team that stops it from attacking the body's own tissues.
The bottom line for your portfolio is about cash flows and concentration risk. If Prop 38 passes, California's general fund would shoulder $500 million to $600 million a year for about 20 years, with potential upside from licensing if big therapies emerge. The design effectively concentrates a large bet in a single qualifying center, increasing the chance of a coordinated research hub while focusing both risk and reward. Michelson says the institute will proceed even if voters say no. He has signed the Giving Pledge and maintains he will not personally profit from the measure.
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