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Evidence of meeting #32 for Industry, Science and Technology in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was patent.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Gay Yuyitung  Business Development Manager, McMaster Industry Liaison Office, McMaster University
Scott Inwood  Director, Commercialization, University of Waterloo
David Barnard  President and Vice-Chancellor, University of Manitoba
Digvir Jayas  Vice-President, Research and International, University of Manitoba
Catherine Beaudry  Associate Professor, Department of Mathematical and Industrial Engineering, École Polytechnique de Montréal , As an Individual

9:20 a.m.

Conservative

The Chair Conservative David Sweet

It will have to be very brief, Mr. Inwood.

9:20 a.m.

Director, Commercialization, University of Waterloo

Scott Inwood

We operate in this pre-commercialization space; so programs of support for de-risking the technology and prototypes.... Quite often you get an idea and then you've got to build a box with some flashing lights and make it look like a product and de-risk it to the point that somebody can be inspired to take that technology to market, either through licensing or through an investment.

So programs like the NSERC idea to innovation program and the CIHR proof of principle program are very valuable programs in the university community.

9:20 a.m.

Conservative

The Chair Conservative David Sweet

I'm going to limit you at that, and then maybe you can fill it in later in response to a similar question. Sorry.

Mr. Stewart now, for seven minutes.

9:20 a.m.

NDP

Kennedy Stewart NDP Burnaby—Douglas, BC

Thank you very much to the witnesses for their very informative testimony.

My first question is for Madame Beaudry. I'm very interested in your U-curve, in terms of patent holdings. You say we're not looking at unlimited growth of patent holdings but maybe rather an ideal number of patents. Can you elaborate on that a little bit?

9:20 a.m.

Associate Professor, Department of Mathematical and Industrial Engineering, École Polytechnique de Montréal , As an Individual

Dr. Catherine Beaudry

I wouldn't say it's an ideal number; it's just the number we're finding in our research. It might evolve if we examine the same data in 10 years. It might drop down to 50 or 80, if we put in place the supports that will help the firms get more out of their intellectual property and it doesn't jeopardize either their growth or their survival. It's not an ideal number, but a number we're measuring in our econometric study.

9:25 a.m.

NDP

Kennedy Stewart NDP Burnaby—Douglas, BC

From your research, do you have any suggestions on how you'd boost that number? Some firms would be able to survive with more patents. Is there anything you found that the government could do to boost that number?

9:25 a.m.

Associate Professor, Department of Mathematical and Industrial Engineering, École Polytechnique de Montréal , As an Individual

Dr. Catherine Beaudry

I think at the moment there's an incentive, probably from a lot of venture capitalists who want to have something to sell as their exit strategy when they capitalize on the company they have invested in.... Companies decide that if they want to get venture capital, then they need to get patents. The venture capitalists will push toward the patents when they want to move towards their exit strategy.

Patents are also important for the firm when they start to collaborate. More and more firms need external expertise when they want to go towards the market for the clinical trials, for prototyping, and other subjects, or just the production and commercialization. They need to protect their IP before they can collaborate, so they can clearly mark that something is theirs, that something else is yours, and that that is how they're going to move forward as an alliance or partnership.

They need to patent, but there's a race to be the first at what we call in French the Bureau canadien des Brevets, the patent office. Maybe firms are spending too many resources on patenting, and once it's time to commercialize then they're left fairly fragile or are weakened somehow.

9:25 a.m.

NDP

Kennedy Stewart NDP Burnaby—Douglas, BC

Thank you very much.

I'll just move on to the universities in general. Have you thought about experimenting with the tenure structure? I went through tenure in 2009, and my incentives were pretty clear: 40% publications, 40% teaching, 20% community service. I know they're different for different universities and different departments, but have you talked about your tenure structure at all, in terms of pushing academics towards more patenting?

9:25 a.m.

Vice-President, Research and International, University of Manitoba

Dr. Digvir Jayas

At the University of Manitoba, I think it depends more on the faculty. For example, in engineering, patents would be considered and given weight in the tenure application, but in social sciences maybe not as much. So I would say the faculties are certainly aware of patents and the value they bring to the research enterprise. As Catherine mentioned, patents lead to publications and then to increased citations, so researchers see that value in connecting.

I don't think patents won't be used; it depends on the unit. Computer science programs will recognize that, health sciences will recognize that.

9:25 a.m.

NDP

Kennedy Stewart NDP Burnaby—Douglas, BC

Have you had these discussions about tenure at your university? You're obviously rewarding with financial incentives as royalties, or that's what you're looking at doing, and that's how you're trying to coax your faculty into making more patents. Have you had discussions about the tenure structure, or is that kind of a no-go area?

9:25 a.m.

Vice-President, Research and International, University of Manitoba

Dr. Digvir Jayas

We've not had as many university-level discussions on that, but we have had unit-level discussions.

9:25 a.m.

NDP

Kennedy Stewart NDP Burnaby—Douglas, BC

Do you have any movement on that? Is that something you would share with other universities?

9:25 a.m.

Vice-President, Research and International, University of Manitoba

Dr. Digvir Jayas

I don't know about other universities. Maybe David would have a better idea.

9:25 a.m.

President and Vice-Chancellor, University of Manitoba

Dr. David Barnard

If you're asking if we are having targeted discussions about the idea of tenure and how it's implemented, no.

Are there variations by faculty? That's the question Digvir answered, I think. Are we as an institution looking to renegotiate tenure? No, we think there are simpler ways to make progress.

9:25 a.m.

Conservative

The Chair Conservative David Sweet

Mr. Inwood.

9:25 a.m.

Director, Commercialization, University of Waterloo

Scott Inwood

I could make a comment on that. I don't know if I would personally support including patenting as part of the tenure process, because what invariably happens is you'll drive what I call vanity patents—people trying to file patents for the sake of having patents. I think a patent should only be filed if there's a commercial opportunity.

I think what would be more interesting in the university environment—and I've made noises about it with my senior administration in the past—is sort of a sabbatical, an entrepreneurial sabbatical for those faculty members who are involved in something that looks commercially interesting and validated through groups such as ours. When we want to work to promote a technology, quite often you can't divorce the lead inventor from the commercial activity, at least initially. But we also don't want to have our faculty members leaving the institution. That's not what we're trying to do either.

A happy compromise might be to offer periodic entrepreneurial sabbaticals to assist in commercialization.

9:30 a.m.

NDP

Kennedy Stewart NDP Burnaby—Douglas, BC

Madame Beaudry.

9:30 a.m.

Associate Professor, Department of Mathematical and Industrial Engineering, École Polytechnique de Montréal , As an Individual

Dr. Catherine Beaudry

I'm on the promotion committee at École Polytechnique de Montréal and it is not very well seen if someone has, for three years, a patent application and no publications whatsoever because they don't want to compromise the patent.

Academics need to keep other research on track at the same time as they're filing a patent. If I'm mono-disciplinary and I'm aiming for a patent, once the patent is issued and I do something else, it will not be very well seen.

There's an increasing tendency by the grant-awarding bodies—which as you know are the tri-councils or the tri-academies, or whatever you want to call them—toward measure impact, and patents are only one type of impact on the cards, and only for specific faculties. As you mentioned, copyright is better suited for computers and software.

I think it's important to measure societal impact beyond a patent as well.

9:30 a.m.

Conservative

The Chair Conservative David Sweet

Thank you very much, Madame Beaudry.

Now we'll go on to Mr. McColeman for seven minutes.

May 17th, 2012 / 9:30 a.m.

Conservative

Phil McColeman Conservative Brant, ON

Thank you, Chair.

Thank you, witnesses, for being here today.

I want to go back to Mr. Inwood to pick up on his de-risking comments that were cut short. I'd like to know more about de-risking and what that means. You talked about packaging it, packaging something that could go forward, but is there more to it than that?

9:30 a.m.

Director, Commercialization, University of Waterloo

Scott Inwood

Because the stuff in the university that we see is very early, there is quite often a requirement to package it—at least to build the first prototype to validate that the technology works, to de-risk to the point that somebody will open up a chequebook and buy something, so that they can actually be inspired that there's a product there and that at least the technical risk has been addressed.

I found from my own perspective that the Canadian receptor base is primarily dominated by SMEs, and they are risk averse. They don't have a lot of disposable resources to invest in those de-risking opportunities, so to encourage them to take that leap of faith and to license it in and move forward with it, we have to bear that weight I guess as much as possible. Then we have more likelihood of getting the technologies licensed, particularly to Canadian entities.

It's not as big a problem, quite frankly, with international companies. Of course, we do research with large U.S. and European companies, and they're quite often more amenable to licensing the technology without those de-risking opportunities. But in the Canadian context, de-risking seems to be much more important to encourage the private sector to take them on.

9:30 a.m.

Conservative

Phil McColeman Conservative Brant, ON

The next question really is for all the panellists to consider and to maybe respond to. Often in industries people look at best practices between industries. There are often group associations. I know there are the university associations as well.

Is there any inclination to look at some basic things—I don't want to say it's one size fits all—across all universities, because it seems to me that you're competing for faculty? I think universities in Canada are set up this way. You're competing for faculty and you're developing your own policies and your own models independently of each other. Or maybe you're not—and you can let me know if that's the case.

But does it make any sense that there would be IP policies that fit across universities? I'm thinking about you describing, in the case of the University of Manitoba, considering the policy and deciding on whether it's 100% researcher owned or there's a split in the ownership. Could you comment on that? Has it been considered that it would be better to not have that but to have a certain consistency across the country?

Maybe we can start with you, David.

9:35 a.m.

President and Vice-Chancellor, University of Manitoba

Dr. David Barnard

Thank you.

This notion of best practices is a nice way to come at this argument, I think, or this topic. Certainly, there clearly are dominant best practices in a lot of areas, but the reality in universities is that most of these arrangements have been negotiated as part of collective agreements, which are not trivial to change. I would say that the suggestion we tabled is a way to think about making progress, without having to go back to the fundamental parameters of the negotiated agreement, and to say, “Let's just make it simpler”.

We can make progress faster by changing some of the parameters and the way we wield the tool we have in our hand. So we may have a slightly different shape of wrench in our hand than Scott has, but we can get similar results by using ours in a slightly different way. Rather than try to renegotiate with our colleagues to do exactly what Scott does, or vice versa, where he would renegotiate and do exactly what we do, our proposed approach to our colleagues and our potential industrial partners—which seems to be getting considerable positive response—is let's try to mask the details of the underlying mechanism with an implementation approach that moves faster.

So yes, at one level it might be attractive to think about having all these be the same, but because they're embedded in complicated arrangements—typically, collective agreements—it would be difficult to go there. It's probably not difficult to make progress by some of us doing things in more creative ways than we've done before.

9:35 a.m.

Conservative

Phil McColeman Conservative Brant, ON

Digvir?

9:35 a.m.

Vice-President, Research and International, University of Manitoba

Dr. Digvir Jayas

The current policies and different policies of the universities don't hinder...in terms of the collaboration. I think a good example is the national centres of excellence program. Those NCE projects typically would involve over a dozen universities. They may have different policies, but we come to an agreement on how we would make the IP transfer from that research to the industry. So in that sense, those different policies don't really get in the way.