According to this NYT blog post:

Dr. Cutler, an assistant professor of plant cell biology at the University of California, Riverside, knew that the rush to be first in this area had previously led to some dubious publications (including papers that were subsequently retracted). So he took the unusual approach of identifying his rivals (by determining which researchers had ordered the same genetic strains from a public source) and then contacting them.

And apparently they went for that pooled their data and jointly authored the results. John Tierny writes:

One counter-argument would be that competition makes everyone work harder and more quickly, thereby benefiting society. But Dr. Cutler argues that this competition can amount to an expensive arms race that doesn’t leave anyone better off. His experiment in cooperation with four other laboratories, he said, yielded “a very compelling body of data validated by many labs,” and has inspired the researchers to go on freely sharing with one another.”

Cutler’s call is that it would be better for everyone to get along. What is interesting are not that there are gains to cooperation but that science has set itself up with a system of priority, attribution and rewards that does not necessarily encourage it. There are plenty of reasons why that might be a good thing including encouraging effort but also allowing others to challenge results. It is not that it is all done with public funding that is relevant. The public should expect the best science has to offer — which may be competition or cooperation. The question is the best it has to offer.