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Dr. Raphael Hofstein
Dr. Raphael Hofstein, president & CEO, MaRS Innovation.

Biotechnology Focus, a compendium of the Canadian life sciences industry, has published a guest column by Dr. Raphael Hofstein, MaRS Innovation’s president & CEO, and Elizabeth Monier-Williams, director of marketing and communications.

The article explores the way research focused on discovery and commercialization are often viewed or positioned as competitors within the funding ecosystem and the need to align their goals:

The time of Canada’s French and English solitudes may be past, as Governor General Michaëlle Jean notably stated when she took office in 2005, but the solitudes of thought concerning how Canada supports basic and commercial research persist.

This thinking is most easily spotted after the government announces a federal budget, triggering a flurry of opinion pieces debating the breakdown for the $2.7 billion Canada spends on research.

Most recently, Jim Balsillie, co-founder of Research in Motion (now BlackBerry Ltd.), wrote for the Globe & Mail about the Canadian need to understand that “geopolitics is at the heart of commercializing ideas,” and create better policies to protect Canadian ideas, including “better
incentives for researchers to spur commercialization,” such as during an academic’s consideration for tenure. Yet, like any business endeavor whose success depends on people, there’s more involved in changing Canada’s approach to commercialization than just policy.

The people must want to change, too.

(Dr. Hofstein has previously argued in Biotechnology Focus that the keys to successful commercialization are the three M’s: merchandize, management and money.)

Canada, as Balsillie rightly argues, has the research merchandize in spades. Within our network recently, Janssen created the Neuroscience Catalyst project at the University of Toronto to select high-potential, early-stage projects to treat Alzheimer’s disease and mood disorders. Janssen’s Boston-based Innovation Centre also established a strategic partnership to co-develop projects with MaRS Innovation; we’ve selected three and the program is expanding. Merck has renewed its financial support of the Structural Genomics Centre, and GE Healthcare has partnered with Sunnybrook Health Sciences Centre and MaRS Innovation to advance the WaveCheck technology as a product.

On the money side, Accel-Rx’s creation in partnership with BDC has opened a funding source for seed-stage life sciences projects. The Networks of Centres of Excellence’s Centres of Excellence for Commercialization and Research (CECR) program continues to support new initiatives in life sciences, such as the Centre for the Commercialization of Antibodies and Biologics and the MedDev Commercialization Centre. Baycrest received $100 million from various sources to advance its aging and neurology research, Trillium raised over $50 million after listing on the NASDAQ, Profound Medical Inc. is set to raise $28 million through the TSX, a clear signal of the openness within Canada’s life sciences sector about using the open market.

Closer to home, Encycle Therapeutics, a joint start-up between MaRS Innovation and the University of Toronto, is set to announce a funding round at BIO 2015 involving CQDM, MaRS Innovation and three industry partners to advance a drug discovery platform.

That brings us to the challenge start-ups face in attracting talented, experienced management. In recent years, MaRS Innovation has witnessed the first successful wave of leaders coming to Canada. Notable examples include Tim Still becoming CEO of Xagenic, Jerry Rodisin becoming CEO of Flybits, and Walter Blattler joining Avid Biologics (now Formation Therapeutics) as executive chairman.

Why the change? Simply put, it’s not altruism. Experienced people seek exciting opportunities where the economy is already attractive, both financially and in other ways. It doesn’t hurt that international venture capital groups are now coming with smart money to do a $3 to $5 million round, which is well beyond the stage of government accelerators.

But there’s more. As Xagenic’s co-founder and an experienced entrepreneur via Boston, Dr. Shana Kelley represents the gold standard of Canadian research entrepreneurs: researchers who develop their science with commercialization outcomes in mind, can explain their work sufficiently to sell it to investors and remain bullish supporters, yet who also understand when to turn the management over to someone like Still.

As MaRS Innovation grows, we see this mentality spreading among the researchers we work with, but the Shana Kelleys within Canadian entrepreneurship remain too few. As Basillie rightly notes, there’s so much more that could be done to help Canadian startups scale globally.

At a minimum, founding scientists have to be willing to allocate time to creating and chairing a scientific advisory board; the CSO role is perfect for those whose passion goes beyond that baseline. Patents, companies created, and revenue generated should count toward tenure conversations, which will in turn drive a greater understanding that public discourse of any sort (publication, presentation etc.) may compromise a discovery’s strength as a global idea. We must note the Bayh-Dole national intellectual property policy is another key factor in North America’s industrial tech revolution, which transformed the United States’ mountains of IP into the Googles and Genentechs of the world.

For Canada to make good on its substantial R&D investment and prowess, we need to turn our well-funded academic research into meaningful outcomes. And that means accepting that the solitudes of basic and commercial research cannot be indifferent or adversarial, but rather integrated wholes.

The genius breakthroughs no one anticipates must be advanced on a global stage to create the revenue needed to fund more genius work: the two research solitudes must work hand-in-hand and be solitudes no longer if Canada is to thrive on the global stage.

The article appears online on Biotechnology Focus‘ website.

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