En­hanced Com­pet­i­tive­ness Re­quires Holis­tic Pub­lic Pol­icy

Policy - - In This Issue - An­drew Casey

As the world’s pop­u­la­tion moves rapidly to­ward nine bil­lion peo­ple, it is in­creas­ingly im­per­a­tive for so­ci­ety to iden­tify ways to im­prove how we feed, fuel and heal the world. Biotech­nol­ogy and the in­no­va­tions it de­liv­ers will be cen­tral to meet­ing the chal­lenges pre­sented by this rapid pop­u­la­tion growth. With a long his­tory of biotech in­no­va­tion, Canada is well po­si­tioned to ben­e­fit eco­nom­i­cally from com­mer­cially de­vel­op­ing com­pa­nies that will bring in­no­va­tion for­ward.

The Cana­dian biotech­nol­ogy sec­tor has demon­strated how re­search, in­no­va­tion and en­trepreneur­ship within a healthy ecosys­tem can pro­duce truly re­mark­able in­no­va­tion and com­pa­nies with enor­mous po­ten­tial to fun­da­men­tally change how we live our lives and run our economies. The sec­tor is made of 900-plus com­pa­nies that are all mov­ing bril­liant ideas from the lab to the real world. These com­pa­nies are lo­cated within ge­o­graphic clus­ters lo­cated across the coun­try and in ev­ery prov­ince.

The re­cent fed­eral bud­get com­mit­ment to “the sin­gle largest in­vest­ment in in­ves­ti­ga­tor-led fun­da­men­tal re­search in Cana­dian his­tory” rec­og­nizes Canada’s strengths in re­search and in­no­va­tion. The ques­tion that re­mains to be an­swered is whether Canada is well-po­si­tioned to max­i­mize the ben­e­fit of this sig­nif­i­cant in­vest­ment.

The long-range goals of the bud­get spend­ing are ap­pro­pri­ately as­pi­ra­tional. As Fi­nance Min­is­ter Bill Morneau stated: “These in­vest­ments are not sim­ply to en­hance the sta­tus quo. In recog­ni­tion of the his­toric op­por­tu­nity for real change, in­vest­ments made though Bud­get 2018 will be tied to clear ob­jec­tives and con­di­tions so that Canada’s next gen­er­a­tion of re­searchers—in­clud­ing stu­dents, trainees and early-ca­reer re­searchers—is larger, more di­verse and bet­ter sup­ported.”

If these stated goals are to be re­al­ized, it is es­sen­tial the con­di­tions they are tied to in­clude: a holis­tic ap­proach that links in­no­va­tion to health care; im­proved pol­icy and reg­u­la­tory col­lab­o­ra­tion across gov­ern­ment de­part­ments; and the de­vel­op­ment of an ef­fec­tive, long-term strat­egy to en­able the com­mer­cial­iza­tion of biotech through de­vel­op­ment and into the mar­ket­place. But for Cana­dian health in­no­va­tion, holis­tic and in­te­grated pub­lic pol­icy re­mains an elu­sive tar­get.

It is telling that Bud­get 2018 con­tained mea­sures for in­no­va­tion, in­vest­ment and the cre­ation of the Ad­vi­sory Coun­cil on the Im­ple­men­ta­tion of Na­tional Phar­ma­care but lit­tle was done to con­nect them. De­spite Canada’s im­pres­sive record of in­no­va­tion in health-re­lated biotech­nol­ogy, we (and in fair­ness, other ju­ris­dic­tions as well) still tend to con­sider health and in­no­va­tion as sep­a­rate is­sues with lit­tle or no need for pol­icy over­lap. While much of the fo­cus in the realm of health care tends to be on short­term mea­sures to con­trol spend­ing, in­suf­fi­cient at­ten­tion is given to how in­no­va­tion can im­prove out­comes, re­duce costs and de­liver eco­nomic ben­e­fits. Not sur­pris­ingly, there can of­ten be sig­nif­i­cant un­der­ap­pre­ci­a­tion of the im­pact health pol­icy can have on in­no­va­tion, par­tic­u­larly in re­la­tion to in­vest­ment.

In the health space alone, biotech­nol­ogy holds enor­mous prom­ise for in­no­va­tion in dis­ease pre­ven­tion and treat­ment. With the abil­ity to map the hu­man genome and edit genes comes the prom­ise of pre­ci­sion medicine and the po­ten­tial to com­bat dis­ease, in­clud­ing the es­ti­mated 7,000 rare dis­eases that fall out­side the tra­di­tional eco­nomic model for the phar­ma­ceu­ti­cal in­dus­try.

Few coun­tries are as well po­si­tioned as Canada to take ad­van­tage of biotech’s po­ten­tial to al­le­vi­ate the chal­lenges fac­ing our health care sys­tem. In ad­di­tion to Canada’s rich his­tory of sci­en­tific dis­cov­ery and de­vel­op­ment, we have a ro­bust, di­verse biotech ecosys­tem that ex­tends across the coun­try and in­cludes: world-class re­search in­sti­tu­tions and hos­pi­tals; proven biotech en­trepreneurs and en­ter­prises; a highly-ed­u­cated work­force; and sci­en­tific, reg­u­la­tory and le­gal ex­per­tise.

Af­ter many long and chal­leng­ing years of early stage de­vel­op­ment, sev­eral Cana­dian biotech stars are now poised to take the next step to be­com­ing com­mer­cial Cana­dian com­pa­nies. Im­por­tantly, a fol­low-on wave of next- gen­er­a­tion com­pa­nies is not far be­hind.

And with a strong biotech in­vest­ment mar­ket both in Canada and abroad, the fu­ture looks promis­ing.

How­ever, in the biotech space, it must be rec­og­nized that one of the crit­i­cal com­po­nents needed for suc­cess is a healthy biotech ecosys­tem. A crit­i­cal com­po­nent of a healthy biotech ecosys­tem is the ac­tive sup­port and en­gage­ment of the large multi­na­tional pharma and biotech com­pa­nies as they rep­re­sent very sig­nif­i­cant part­ners, in­vestors and adopters for early stage pre-com­mer­cial biotech com­pa­nies and their in­no­va­tions. Given the highly spe­cial­ized na­ture of health biotech com­pa­nies and their prod­ucts, there is a crit­i­cal con­nec­tion be­tween the biotech SMEs and the large multi-na­tional com­pa­nies. In­deed, while the re­cent suc­cess of some Cana­dian early-stage biotech com­pa­nies is very en­cour­ag­ing, it is im­por­tant to note that al­most ev­ery one of them has one or more multi-na­tional pharma com­pa­nies as an in­vestor and/or part­ner. Fur­ther­more, the in­dus­try in­cu­ba­tors and ac­cel­er­a­tor or­ga­ni­za­tions all rely heav­ily on the sup­port and part­ner­ship of the multi-na­tional com­pa­nies to drive their work in iden­ti­fy­ing and launch­ing new Cana­dian com­pa­nies.

Rec­og­niz­ing the im­por­tant cat­a­lyst role multi-na­tional com­pa­nies cur­rently play and must con­tinue to play in driv­ing Cana­dian in­no­va­tion for­ward, it is vi­tal that gov­ern­ment pol­icy in all ar­eas rec­og­nize the in­ter­con­nec­tiv­ity of all parts of the ecosys­tem. Pub­lic pol­icy that is siloed and solely fo­cused on sav­ing dol­lars will not only be less ef­fec­tive, it will ul­ti­mately un­der­mine Canada’s com­pet­i­tive­ness and abil­ity to de­velop in­no­va­tion. By con­trast, holis­tic pub­lic pol­icy that rec­og­nizes the in­ter­con­nec­tiv­ity of the ecosys­tem can act to es­tab­lish pos­i­tive host­ing con­di­tions to greatly en­hance Canada’s com­pet­i­tive­ness and abil­ity to at­tract in­vest­ment and com­mer­cial­ize in­no­va­tion.

Un­der­stand­ably, health care is of­ten viewed through the rather lim­ited and short- hori­zon fis­cal ex­pense lens which has a lim­ited ca­pac­ity for see­ing eco­nomic value and ben­e­fit. In­deed, pol­icy un­der­tak­ings to ad­dress health care rarely take into con­sid­er­a­tion the im­pact the changes will have on the broader ecosys­tem and its abil­ity to sup­port in­no­va­tion. Sev­eral other com­pet­ing ju­ris­dic­tions have rec­og­nized the com­pet­i­tive na­ture of the in­dus­try and have moved to adopt a more in­te­grated pol­icy ap­proach where health care ob­jec­tives and pol­icy can sup­port lo­cal health care in­no­va­tion.

Tra­di­tional ar­eas of fo­cus and ju­ris­dic­tional bound­aries are in­grained and hard to breach. Yet, tra­di­tional silo-based views do not pro­vide the kind of broad think­ing and pol­icy syn­er­gies nec­es­sary to ap­proach prob­lems from a dif­fer­ent per­spec­tive and achieve dif­fer­ent re­sults. Work­ing to­gether, pol­icy spe­cial­ists from dif­fer­ent dis­ci­plines could de­velop novel and ef­fec­tive ap­proaches to pol­icy that com­bine health and in­no­va­tion. We need a com­mon vi­sion of what is pos­si­ble and what can be ac­com­plished to take ad­van­tage of the rich legacy of biotech en­gi­neer­ing to help solve the chal­lenges fac­ing our health care sys­tem.

For ex­am­ples of what can be ac­com­plished, look at the model of Aus­tralia, where the gov­ern­ment of New South Wales has cre­ated a chief sci­en­tist and en­gi­neer of­fice un­der the in­dus­try depart­ment. The chief sci­en­tist and en­gi­neer works with the sci­en­tific, en­gi­neer­ing and re­search com­mu­ni­ties, the higher ed­u­ca­tion sec­tor and busi­ness to pro­mote growth and in­no­va­tion. The ma­jor ob­jec­tive is to build the state’s knowl­edge base across a range of ar­eas, in­clud­ing med­i­cal re­search, to at­tract in­vest­ment, cre­ate strong con­nec­tions be­tween busi­ness and academia, op­ti­mize R&D in­vest­ment and iden­tify new ar­eas of re­search.

In the United King­dom, suc­ces­sive gov­ern­ments have spent the bet­ter part of the last decade pur­su­ing the de­vel­op­ment of a life sci­ences ecosys­tem that builds on ex­ist­ing links among re­search in­sti­tu­tions, busi­ness and, sig­nif­i­cantly, the Na­tional Health Ser­vice.

In Canada, it is past time to break down the si­los of re­spon­si­bil­ity be­tween fed­eral de­part­ments to en­sure that Canada reap the full ben­e­fit of the R&D in­vest­ments be­ing made by both gov­ern­ment and pri­vate-sec­tor en­trepreneurs. If we are to com­pete with other ju­ris­dic­tions with re­spect to de­vel­op­ing in­no­va­tion and at­tract­ing in­vest­ment, Canada’s pub­lic pol­icy en­vi­ron­ment must be as com­pet­i­tive as pos­si­ble.

Here in Canada, it is past time to break down the si­los of re­spon­si­bil­ity be­tween fed­eral de­part­ments to en­sure that Canada reap the full ben­e­fit of the R&D in­vest­ments be­ing made by both gov­ern­ment and pri­vate-sec­tor en­trepreneurs. If we are to com­pete with other ju­ris­dic­tions with re­spect to de­vel­op­ing in­no­va­tion and at­tract­ing in­vest­ment, Canada’s pub­lic pol­icy en­vi­ron­ment must be as com­pet­i­tive as pos­si­ble.

The Eco­nomic Strat­egy Ta­bles cre­ated by the fed­eral gov­ern­ment present a promis­ing sign that we may be mov­ing in the right di­rec­tion. En­vi­sioned in Bud­get 2017 as “a new model for in­dus­try-gov­ern­ment col­lab­o­ra­tion,” these strat­egy ta­bles in­clude life sci­ences as well as ad­vanced man­u­fac­tur­ing, agri-food, clean tech­nol­ogy, digital in­dus­tries

and clean re­sources, which is en­cour­ag­ing. The ta­bles are in­dus­tryled but in­clude se­nior of­fi­cials from key de­part­ments with pol­icy over­sight of the im­pli­cated in­dus­tries. It is ex­pected the ta­bles will iden­tify ways to ad­dress key road­blocks im­ped­ing the eco­nomic growth of each sec­tor.

Good tech­nol­ogy can come from any­where, pro­vided the ingredients for suc­cess are present. And that’s where biotech in­cu­ba­tors can play a crit­i­cal role. In­cu­ba­tors func­tion as hubs for life sci­ence en­trepreneurs, in­dus­try and aca­demics to share ideas and for their work in prod­uct de­vel­op­ment to syn­er­gize. They en­able Cana­dian com­pa­nies to at­tract the at­ten­tion of prod­uct and IP scouts and drive ex­per­tise into a de­vel­op­ment cy­cle that is out­side of aca­demic in­sti­tu­tions, be­yond the head of­fice of a multi­na­tional. They are nec­es­sary for a com­pet­i­tive,

Gov­ern­ments at all lev­els have rec­og­nized the im­por­tant eco­nomic and so­cial value of biotech­nol­ogy in­no­va­tion. In­no­va­tion agen­das, cor­re­spond­ing pol­icy mea­sures and in­vest­ment in early-stage sci­ence and re­search are all very im­por­tant un­der­tak­ings.

val­i­dated ecosys­tem of biotech in­no­va­tion.

Gov­ern­ments at all lev­els have rec­og­nized the im­por­tant eco­nomic and so­cial value of biotech­nol­ogy in­no­va­tion. In­no­va­tion agen­das, cor­re­spond­ing pol­icy mea­sures and in­vest­ment in early-stage sci­ence and re­search are all very im­por­tant un­der­tak­ings. If suc­cess­ful, these strate­gies and early in­vest­ments will lead to cut­ting edge in­no­va­tions and com­pa­nies. But if we are to be truly suc­cess­ful we must be look­ing to take Cana­dian in­no­va­tion and cre­ate glob­ally com­pet­i­tive Cana­dian com­pa­nies. Siloed pol­icy de­vel­op­ment may de­liver short-term re­sults within the nar­row con­fines of the silo but the wins will more of­ten than not be Pyrrhic. Con­versely, holis­tic and in­te­grated pub­lic pol­icy that rec­og­nizes the con­nec­tiv­ity of an ecosys­tem will ul­ti­mately de­liver bet­ter and longer-term re­sults for the econ­omy and so­ci­ety writ large.

An­drew Casey is Pres­i­dent and CEO of BIOTECanada, an Ot­tawa-based na­tional in­dus­try as­so­ci­a­tion with over 200 mem­bers across the coun­try in Canada’s health, in­dus­trial and biotech­no­log­i­cal sec­tor. an­drew.casey@biotech.ca

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