TORONTO – Canada is number two and proud of it when it comes to
biotechnology, officials from government and industry said last week as
the country hosted 14,000 delegates to the world’s largest biotech
conference.
“It is a rare opportunity to draw international attention to our
strengths,” industry minister Allan Rock said as he kicked off the Bio
2002 conference.
The strengths he promoted include the second largest number of biotech
companies at 400, the third largest biotech revenue base next to the
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United States and the United Kingdom, and 62,000 biotech jobs, and
growing. Agriculture is the second largest area of biotech activity.
“We have outperformed every other country,” Rock told a news conference
June 9.
“I’m not going to apologize for celebrating Canadian heroes.”
Peter Harder, his deputy minister, tried to lure more foreign
investment by describing Canada as a place with welcoming public
opinion, low corporate tax rates, an educated work force, significant
tax incentives and an atmosphere that is “generous to companies.”
Throughout the four-day conference, countries from around the world
challenged Canada’s claims, promoting themselves as the next great
centre of biotech growth.
And the federal government published a report that drew attention to
some of the Canadian sector’s weaknesses.
It is small, immature, undercapitalized and lacks a critical mass of
activity, said a study by the accounting firm Ernst and Young. Without
improvement, many of Canada’s nascent biotech companies could disappear
or be swallowed by larger competitors.
“It is questionable whether the current number of companies is
sustainable,” said the Beyond Borders study.
“The majority of Canadian biotechs are still reporting business losses
and research and development spending increased 36 percent during 2001.
If companies are unable to reduce these losses over the next few years,
there will likely be continued pressure for consolidation, strategic
alliances or outlicensing of technology….”
It said agriculture-related companies are 15 percent of the total, but
are able to raise little private capital.
Overall, companies remain small and in the product development stage,
rather than in global marketing.
In fact, the biotech industry is described as a classic case of
Canadian state capitalism in the face of an underwhelming market
response.
“To date, the success of the industry in Canada can largely be
attributed to government programs … as well as the commitment to
research of several world-class universities in Canada,” the report
said.
Still, industry leaders spent the week extolling Canada as a great
place for biotech investment, and the government released a book
promoting the prowess and virtues of Canadian biotech industry leaders.
Several agriculture-related firms made it into Follow the Leaders:
- Calgary’s Sembiosys Genetics Inc. uses safflower to produce proteins
that are used to make vaccines and other products. The company aims to
become the biggest supplier of transgenic proteins for the drug market.
“In the process, Sembiosys’ technology may create exciting
opportunities for oilseed farmers,” the book said.
- Montreal-based Nexia Biotechnologies Inc. hopes to use transgenic
goats to produce a protein in milk that creates one of the world’s
strongest materials that would be used in products as varied as bullet
proof vests and construction materials.
- Ottawa-based Iogen Corp. uses agricultural straw and corn stalks to
produce bioethanol fuel.
