The Canadian environment for innovation and business development in the biotechnology industry: a firm‐level analysis

Abstract

This paper is an empirical study of firm‐specific characteristics in the Canadian biotechnology sector. The research context examines the national system of innovation and regional infrastructure in place for the biotechnology industry. Literature on the Canadian biotechnology industry is not as extensive as studies on the US biotechnology industry. The current analysis shows that the Canadian sector is innovative and outward looking. One group of firms is more research oriented and the other is more product/process oriented. The first group emphasises the need to expand their science base through increased funding including inward foreign investment. The second group emphasises organisational needs such as improved feedback from product development and manufacturing to R&D; the development of manufacturing capabilities; the need to find new Canadian buyers; and the internationalisation of R&D through outward foreign direct investment. Place‐specific characteristics matter to the process of innovation and commercialisation for both groups: firms with high levels of R&D intensity seek access to scientists, universities, pharmaceutical companies and funding. Firms with low levels of R&D intensity seek access to manufacturing facilities and customers. An analysis of geographic or sectoral variation in strategies could not be accomplished due to data limitations. However, the results show the importance of Canadian participation in the internationalisation of innovation and commercialisation of biotechnology products. Such a trend needs to be considered in Canada's international negotiations pertaining to policies and regulations of international trade and investment (both inward and outward foreign direct investment) in biotechnology products.

Notes

Sharmistha Bagchi‐Sen, Department of Geography, State University of New York‐Buffalo, Buffalo, NY 14261, Phone: [phone] ext. 21, Fax: [phone], E‐mail: [email protected]

“Fears of the dangers of genetic engineering led to public meetings in Cambridge with slogans such as ‘No Recombination Without Representation’, and the construction of a new P3 laboratory at Harvard for genetic engineering became a controversial matter” (Hall, 1987, pp. 41–45 cited in Prevezer, 1998, p. 157)

The Canadian Intellectual Property Office is responsible for the processing and administration of patents, trademarks, copyrights, and industrial design. The Federal Partners in Technology Transfer (FPTT) facilitates linkages between universities, firms and the government to enhance the process of technology transfer. Initiatives that promote industry linkages include: The National Technology Index (NTI); the Opportunity Match system; the Commercialization Toolbox; and Trans‐forum. Additional initiatives that support the Canadian biotechnology industry include: Technology Partnership Canada (TPC); The NRCs Industrial Research Assistance Program (IRAP); the Canada Small Business Financing Act; Business Development Bank of Canada; The Biotechnology Human Resources Council (BHRC); Human Resources Development Canada (HRDC); and Genomes Canada. The Canadian government is also involved the international debate over food safety through their participation with the CODEX Ad hoc Intergovernmental Task Force on Biotechnology.

This survey was conducted by the Science, Innovation and Electronic Division of Statistics Canada, and was one of a series of surveys that were initiated in 1996.

The 84 drugs listed are strictly new medicines for human consumption. The final fifteen companies derived from the PMPRB “New Patented Medicines” reports 1998 – July 2002 were determined by comparing the PMPRB list of companies (which originally included both pharma and biotech companies) with both the companies listed in our survey and those in the list of biotechnology companies provided by Strategis Canada.

Niosi and Bas 2001 notes five laboratories established by National Research Council and one provincial lab: The Biotechnology Research Institute (BRI) in Montreal (estd. 1987), The Institute for Biodiagnostics (IBD) in Winnipeg (estd. 1992), The Institute for Biological Sciences (IBD) in Ottawa (estd. 1916), The Institute for Marine Biosciences (IMB) in Halifax (estd.) 1952, The Plant Biotechnology Institute (PBI) in Saskatoon (estd. 1948), and the provincial lab in Edmonton (The Alberta Research Council (ARC), estd. 1936).

Additional information

Notes on contributors

Sharmistha Bagchi‐Sen

Sharmistha Bagchi‐Sen, Department of Geography, State University of New York‐Buffalo, Buffalo, NY 14261, Phone: [phone] ext. 21, Fax: [phone], E‐mail: [email protected]