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3 February 2014Americas

Aiming high: Canadian biotech

Canada’s economy was built on a vast and varied natural resource base. Today, agriculture, energy, mining and forestry still account for more than half of the country’s exports. While the balance of the economy is changing over time, away from the big traditional industries and towards other sectors, it is still the case that much of Canada’s wealth comes from its land or what grows on it.

For BIOTECanada, the industry association representing the country’s biotechnology industry, the challenge is promoting a different kind of natural resource. Andrew Casey, president of the association, describes the industry in Canada as “large and small companies trying to take good ideas to help other industries transform.”

The association has three main focuses: health, of course, and then industrial and agricultural. These last two play an important role in Canada’s economy, and Casey is keen to highlight some of the contributions made by biotechnology companies to those sectors. For example, one association member has developed a process to extract from mustard seeds a substance that can be used as jet fuel. Emissions are significantly reduced, and the by-product can be used for animal feed. Another example is a company that has developed an enzyme to “gobble up CO2 emissions from the oil and gas sector,” Casey says.

Biotech in Canada has “never been a big industry per se,” Casey adds. “It’s more about what it does for other industries. It allows other things, the economic engines such as forestry, mining, oil and gas and agriculture, to compete in the bio economy.”

Of course, despite the industrial make-up of Canada, the biotech industry still has a substantial role to play in health. “We’re in the world of small innovators on the health side, looking to find innovations for a population that’s ageing,” Casey says.

For its members, the association aims to be “the voice of the industry in the public realm”, as well as working with government on a federal level to shape policy. However, as with any trade association, getting consensus from all members can be tricky (BIOTECanada has 250 member companies, ranging from agricultural behemoths to young research companies).

Casey acknowledges the challenge, but points out that any difficulties are not necessarily a function of the large number of members. The Canadian Bankers Association has just six members, he says, but you could make an argument that it faces at least as many challenges in reaching consensus.

So how can an association with such a diverse membership possibly function effectively? Casey says it’s about searching for “the issues that we can find commonality on,” and then agreeing on “certain issues that are either competitive or proprietary in nature” and agreeing to not address them.

“If we’re out of step or a bit behind with IP protection, then the capital, that fickle guest, is going to go to those other countries which afford better protection for intellectual property."

But he adds, “the industry is quite aware of the need to present a common voice,” and there are some good examples in health. The large pharmaceutical companies, for example, have their agendas but are also aware that they need to replenish their pipelines, Casey says, and that requires the smaller end of the industry to do well. Similarly, the younger companies need to have thriving larger players in the marketplace, because that’s where the investment is likely to come from.

As for intellectual property, Casey says “that’s a really important part of the equation.” When looking at the industry “and certainly when you look at the small members within the association, what we’re really talking about at its very base is a good idea.”

That good idea “is usually sitting on a computer if it’s pre-commercial”, he says, or possibly in clinical trials. Unlike in many other industries though, good ideas in biotech are very portable. As Casey points out, in other Canadian industries such as forestry, operations are constrained by geography (where is the forest?). “But in our industry, if the capital’s not coming to Canada, if the investment’s not here, if the partners aren’t here, it will go to where that investment and those partners are.

“A huge component determining where that investment goes is the security that is provided when it does land. If you think of investment as almost like a tourist, and every country’s trying to attract that tourist, well that country’s got to put out some goodies to attract that tourist. For investment, one of those things is IP and IP protection. It’s one of the areas we follow very closely because it’s a huge determinant in where investment is going to go and whether or not these great ideas that we have in Canada are going to get commercialised in this country.”

So how does Canada measure up when it comes to the ability of its IP system to attract investment? Casey has some reservations. “At a very minimum, we have to keep pace with other countries in terms of IP protection. If we’re out of step or a bit behind with IP protection, then the capital, that fickle guest, is going to go to those other countries which afford better protection for IP. That’s the base line.

“We can look at the recent Canada/Europe trade deal, in which we saw some steps taken in the right direction to put in place a fairly competitive IP regime … we’re probably going to have similar discussions over the Trans Pacific Partnership with the US and others. We have to be on a par with them.”

But while the opportunities for international harmonisation look good, the association has concerns closer to home. Casey explains: “The other big part of this, and what’s of greater concern, are some of the recent court decisions in Canada on patent utility, and the trickledown effect that’s having on our Intellectual Property Office.

“They’re actually starting to put into their thinking court decisions ruling some patents inutile. That’s a huge concern for us, and the courts seem to have gone beyond their normal remit, and to correct that we’re going to have to see the government taking policy action, and that’s one of the areas we’ll be working on over the year ahead.”

Despite those recent court setbacks, Casey is confident that Canada remains an attractive location for biotech companies to do business. Its educated population and quality of life are attractions, but more than that, “you’ve got a history of clinical trials, you’ve got a history of biotech innovation in the country”, all of which make it an appealing prospect. “You also have a big pharmaceutical footprint here, which is attractive … and Canada has a healthy reputation for supporting the industry.”

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