Innovation Nation: a homegrown approach to grow Canada’s biotechnology sector
On the global stage, Canada’s role in shaping the international economic landscape can often be overshadowed when compared with giants like the U.S. and Europe. This holds true in the life science and biotech industry, where U.S. universities and biotech companies have historically lured Canadian talent with the promise of better opportunities.
In the 2000s, Canada saw an annual net loss of more than 15,000 permanent residents to the U.S [1]. This phenomenon, also known as the “brain drain”, ebbs and flows with the economy, where job-seekers have sought the stability that comes from the large, well-established U.S. job market. In recent years the brain drain has slowed, no doubt influenced in part by the fluid North American political landscape and changes in sentiment regarding economic opportunities. But for the Canadian biotechnology sector to grow, immunization against another brain drain must be part of strategic planning when looking to attract investors. How can the Canadian biotechnology sector protect their talent in an ever-changing economy? A new initiative led by UofT, called the Canadian Hub for Health Intelligence and Innovation in Infectious Diseases (HI3) might serve as the model for sustainable biotechnology innovation in Canada [2].
The HI3 initiative is bringing together academic institutes from across the country with partners in biomanufacturing, pharmaceuticals, and commercialization to create a domestic pipeline that is flexible, self-sufficient, and able to respond to emerging biological threats. Rather than starting from scratch, the HI3 leverages established pillars of Canadian innovation, namely our world-class academic institutes and a single-payer healthcare system that ensures a basic standard of care across provinces and territories.
On the surface, it might not seem obvious how these pillars will help Canada drive sustainable growth of the biotechnology sector. But a closer examination of Canada’s strengths and alignment with growing trends in capital investment reveal why there is cause for optimism.
Strength of Canada’s Academic Institutes
Despite its relatively small population, Canada has always punched above its weight class for scientific discovery. This begins with the quality and public trust we place in our academic institutions, where the seeds of discovery are born.
The discovery of insulin, which changed health outcomes for millions suffering from diabetes, was made at the University of Toronto by Banting, Best, and Collip [3]. This could have entrenched Toronto as a mecca for a booming biotechnology sector, but instead, the Canadian life science industry acts more like a feeder system, with major U.S. investors and trade on a U.S. exchange viewed as key bottlenecks for growth.
Still, discoveries like insulin have helped Canada gain a stronger foothold of the life science market. Currently, Canada holds the fourth-largest biotech market and the second-largest biotech corridor in North America. The Ontario-Quebec corridor hosts a large concentration of universities and approximately over 1000 organizations in the biotech space [4], enabling a strong pipeline for highly skilled talent to flow from academia to industry.
Capitalizing on this pipeline and growing the Canadian biotechnology sector requires immediate investment to scale-up production capacity. This has been a limitation of the Canadian life science industry since UofT sold the production rights to commercially produce insulin to Eli Lilly in 1922 [5], due to Canada’s limited biomanufacturing infrastructure.
A lack of industrial scale-up is not the only factor that has slowed the growth of biotech in Canada. Investors have also taken a conservative approach when it comes to Canadian biotechnology, in part due to the undue fear that Canada does not protect its intellectual property and that Canadian academics willingly share scientific breakthroughs for free [6]; a stereotype that has outlived most things born of the roaring twenties.
As evidence to the contrary, one of the key ingredients in the COVID-19 mRNA vaccines was pioneered by UBC professor Pieter Cullis and produced by a Canadian biotech company that he co-founded [7]; the financial success and global impact of this invention cannot be overstated.
Canada’s response to the COVID-19 pandemic highlighted the incredible determination and collaborative spirit of our scientific community [10], but it also identified additional gaps in supplying essential medical equipment, vaccines, and medicines on a global scale. With initiatives like HI3 and further investment in this sector, gaps like these might disappear.
Strength of Canada’s Healthcare System
Canada’s strong international reputation for our academic institutes also extends to the perceived quality of our healthcare system, and its ability to provide exceptional service, both at home and abroad. On this front, Canada has more than stepped out of the shadow cast by the U.S.
As a global leader in equitable healthcare delivery, it seems only natural for Canada to embrace the growing importance of environmental, social, and governance (ESG) investing to grow the Canadian biotech sector.
ESG investing, once considered a purely charitable endeavour, is now increasingly recognized as an important class of funds for investors concerned with social impact. While ESG investing has grown in popularity in large part due to the global emphasis on climate change, focusing on the ‘S’ in ESG represents a major, untapped area, according to a recent BCG article [8]. Here, Canada’s healthcare system is uniquely positioned to lead from the front.
In what might be a harbinger of a brighter, more sustainable future for big biotech, Eli Lilly, one of the world’s largest suppliers of insulin [9], recently capped the out-of-pocket price of this life-saving drug to near-universal praise and a bump in stock prices; a sign that large pharma is willing to listen to stakeholders who care equally about portfolio growth and social impact.
It will take time to see whether initiatives like HI3 will achieve their mission of providing a rapid, effective, and equitable response to future pandemics (hopefully we will never have to find out). It might take even more time to see whether these strategic collaborations between academia, industry, and governments will lead to scalable and sustainable growth of homegrown discoveries and talent in other biotech sectors. But to do so, we must first retain brains so that we can build a future where brains reign.
Sources
https://nationalpost.com/news/canadas-brain-drain-to-u-s-slowing
https://businessevents.destinationcanada.com/blog/editors-pick/quebec-ontario-life-sciences-corridor
https://www.lilly.com/discovery/100-years-of-insulin/timeline
https://www.bcg.com/en-ca/publications/2021/sustainable-investing-leadership-blueprint
https://www.nbcnews.com/health/health-news/eli-lilly-caps-cost-insulin-35-month-rcna72713
