The Mark 2010

Canadian biotech firms needs to reach out to firms in the developing world if they wish to be competitive.

Co-authored by Monali Ray

To be competitive biotech firms must partner or perish. Finding the right partner in any sphere of life is a tough task and has been made more challenging in the biotech field as the playing field has expanded. The world is changing and the innovation springs in the biotech sector can now be found in developing nations, especially the emerging nations China and India, but also in small developing countries such as Cuba.

Recently the McLaughlin-Rotman Centre for Global Health at the University Health Network, University of Toronto, released a study funded by the Canadian Institutes of Health Research that casts light on Canada’s health biotech partnerships with developing countries. It shows that partnerships between Canada and developing country firms creating new medicines, diagnostics, and vaccines produce results stronger than any firm can acting alone. The study was published in the September issue of the journal Nature Biotechnology and is based on an unprecedented survey of collaborations of Canadian health biotech firms with developing countries.

All Canadian firms that we could identify to be active in health biotech, 259 firms in total, were contacted, 181 replied resulting in a relatively high response rate of 70 per cent. Roughly one in four reported having joined forces with counterpart firms in developed countries – some 82 collaborative initiatives in all. Of the 82, the main collaborators were firms in the emerging economies China (22 initiatives) and India (17). No surprise there. But Canadian firms are also reaching out more widely to the developing world including Latin America (21 initiatives) and Sub-Saharan Africa (9), with marketing the most common type of collaboration.

Clearly, with their large populations and large market potentials, many developing countries are attractive to northern firms. The finding shows that Canadian health biotech firms have started to recognise the need to establish international marketing alliances, a strategy of particular importance to weather tough economic times. Tellingly, the average revenue of Canadian firms that collaborate with those in developing countries was $16.3 million, almost four times as much as Canadian firms that don’t collaborate.

Joint research and development was a close second as the most frequently cited collaboration type. Canadian firms and those in developing countries are partnering to strengthen their innovation potentials, to take advantage of each other’s expertise, and to lower the costs involved in the research, development and clinical testing of new health products.

The Canadian firm Generex, for example, has partners in developing countries to develop its technology for needle free delivery of insulin against diabetics. Almost 80 per cent of diabetes deaths occur in developing countries and its prevalence is increasing rapidly. The World Health Organization estimates that diabetes rates in countries such as Brazil, China, and India will more than double by 2030. Recognizing the technology’s high relevancy to developing countries’ health needs, Generex decided early on that North-South collaboration would be a key component of its product development strategy and partnered with both an Ecuadorian research institute and pharma firm to carry out early clinical testing. That success inspired subsequent Generex licensing agreements with partners in China, South Africa, India and elsewhere, boosting investor confidence.

Firms in developing countries find it attractive to collaborate with Canada, a country that has invested extensively in health biotech research and is the 6th most prolific publisher of health biotech-related literature in international peer reviewed journals. Through global collaboration this investment in health biotech can be successfully applied against a debilitating global health issue, and at the same time strengthen Canadian innovation record.

Among other interesting survey findings, the knowledge flow between Canada and its partners was commonly bi-directional. For example, the Canadian firm YM Biosciences (named among Canada’s top 10 life sciences companies two years in a row) partnered with Cuba’s Centre for Molecular Immunology to promote Cuban research and manufacture of anticancer agent Nimotuzumab. The Canadian firm licensed the technology and is coordinating clinical trials in Europe, Asia, Latin America and North America. The marriage of Cuban science with Canadian expertise in conducting clinical trials and commercialisation is creating a treatment against a number of cancers, including lung, colorectal, pancreatic, cervical, breast and prostate.

To be true global competitors, Canadians need to continue to take advantage of the opportunities all over the world. Ministers of Industry and Trade together with the Ministers of Health, International Development and Foreign Affairs, should note that the global innovation landscape in health biotech is changing. Policies in northern countries typically give top priority to a "national" vision or to partnerships with other developed countries.

Canada has started to globalize its innovation vision and has, for example, signed bilateral science and technology agreements with the emerging economies India, China, and Brazil, and is supporting collaborations with these countries through ISTPCanada. But to strengthen imagination and innovation more emphasis at the federal, provincial, and municipal levels should be placed on encouraging global ties. Most immediately, programmes are needed to match potential collaborators in Canada and developing countries and help them take the first steps together.

A creative and collaborative global process will create many of the medicines, vaccines and diagnostics of the 21st century. A forward looking policy will ensure that Canadians are full participate in this global process, strengthen the Canadian economy and contribute towards improvement of the health of people everywhere.