Biotech industry in Canada lacks focus, Board report says

By Kristin Goff
Ottawa Citizen
November 29, 2005

OTTAWA -- Canada needs to develop a more focused biotechnology strategy by developing areas of excellence so that it can succeed in the competitive global market, the Conference Board of Canada says in a report.

"The past performance of Canada's biotechnology researchers and businesses is no guarantee of future success," Trefor Munn-Venn warns in a Conference Board report on Biotechnology in Canada.

"We lack focus at the national level; our commercialization record is weak; we have limited ability to harness capital; and we have a critical shortage of skilled talent," he said in a report released to coincide with the opening of the BioNorth 2005 conference in Ottawa Monday.

In a brief interview later, Munn-Venn said Canada now stands at an important juncture, having developed a substantial pool of about 500 biotechnology companies, most of which are still not at the commercial stage. Just 10 of those companies represent about 70 per cent of the industry's market capitalization.

In a field where product development can take years, a study by Ernst & Young indicates that 38 per cent of publicly traded biotechnology companies have less than one year's worth of cash available, and that situation appears to be growing worse, said Munn-Venn.

For the industry to thrive, Canada will have to make its place in global markets as more companies move to the commercial phase.

"When we go to market in Canada the question is, 'Where are we going to dominate in the global supply chains?' " he said. "Our view is we should do it by design, rather than accident."

Other countries have already adopted a strategic approach to biotechnology development, he said. For example, the U.K. has set a goal of becoming the best place in the world to conduct clinical trials. In India, two-thirds of all biotechnology investment is directed at the health sector. The U.S. is focusing the lion's share of its government funding on vaccines and other medical measures to counter bio-weapons.

Canada's biotechnology developments are scattered in agriculture, health, environment, food processing, aquaculture, bio-informatics and natural resources.

Compared to several other countries, Canada appears to have some advantage or relative strength in food processing, environment and aquaculture-related research or commercial developments, according to the report.

But its authors didn't recommend any specific areas for Canada's biotechnology industry to emphasize.