Industry Committee on June 6th, 2017

[The Chair, Liberal, Dan Ruimy]

Thank you.

Mr. Jowhari, you have five minutes.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you.

Welcome to all our presenters.

Mr. Porter, I am interested in the comment you made that we are suffering from a low outreach because of the staffing in the tech transfer offices. As you know, between 1995 and 2009, through the IPM program, the government tried to infuse some funds in there and expedite or accelerate that commercialization. Do you think that worked?

[Kenneth Porter]

Yes.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Okay.

[Kenneth Porter]

I know how it didn't work, too. When the funding was taken away, not only were the staffing levels reduced at the universities, but the most experienced people were lost because they had the higher salaries.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Do you have any data so we could correlate this number of tech transfer officers in a university or in a mini-cluster such as the WCIO with this much commercialization? Everybody threw a lot of stats out. One of the stats I'm looking for is if you had a certain number of tech transfer officers, how much commercialization and how many jobs were created.

Also, do you believe that it needs to continue in this form, or should we look into possibly privatizing the whole tech transfer?

We can start with Mr. Porter and go to Mr. Susalka, and then probably Mr. Hinton can touch on it.

[Kenneth Porter]

I'll hit the last point. Innovate Calgary is a private company, so we do have that vehicle. AUTM also collects data on the number of professionals associated with each university. I see Steve getting really excited about that, so I'll let him go ahead.

[Stephen Susalka]

You're right. We do collect all sorts of data. There are two or perhaps three interesting data points to back up the importance of that fund and the absence of it affecting Canadian transfer in a negative way.

Number one, in 2003, licensing revenue by the Canadian institutions was $72 million. For perspective, it's $62 million now, 14 years later. It peaked in 2003, and then it dropped.

Another really important point, and Mr. Porter touched on this, is that funding allowed for continued education of faculty members. It should come as no surprise that a peak in invention disclosures.... If you look at it in five-year intervals, in 2009 there were 1,921 invention disclosures, so [Technical difficulty—Editor] closer to 1,800. You can see that we had a peak and now we have a drop-off.

The third statistic I wanted to point out [Technical difficulty—Editor] start-up companies. In 2003, there were 58 start-up companies, and that dropped to 48 in 2009, so we had a significant drop-off, perhaps with the lack of manpower in those offices.

I just wanted to give you some statistics.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you. Could I ask you to submit those? Because of the technology issues that we have here, we probably did not capture all of that. If you could submit those stats, it would really be appreciated.

[Stephen Susalka]

Sure.

[Majid Jowhari, Liberal, Richmond Hill, ON]

With the little bit of time I have left, I want to go to Mr. Hinton. If you could, please combine two things. There's the answer to that question, and you also talked about helping our companies and universities to compete globally when it comes to IP. How, as a government, could we help the IP generators and companies to compete globally?

[James Hinton]

To the first question, there was an organization that existed from the 1930s until 1992 in Canada, called Canadian Patent Development Limited. There's one paper on it, if you want to see a coordinated approach on what happened to it. It was axed in the early 1990s.

I'll give you two stats. Apple and Google spend more on patents than they do on R and D. We're being woefully outplayed if we think that we can have a couple of tech transfer officers here and there and compete at this level. IBM got more patents last year than the entire country of Canada. We're being woefully outplayed. We're not capturing the IP. We have great technology, but we're just giving it away. Those are my stats.

What can we do about it? IP education is a start. I work at Communitech. I'm there every week, and I give out pro bono IP law clinic work. If a student from UW wants to talk about IP, I'm happy to give away my time. Getting the profession out and being more active at the hands-on ground level, professing, giving away this IP knowledge, and getting it in there, that's the base level.

Then, internationally, we need mechanisms that are going to enable Canadian companies to compete globally. This includes litigation support. If Canadian companies get into international IP litigation and they're being dragged down to east Texas to defend against a non-practising entity or patent troll, they need to have the sophistication, which is not available in Canada, to manage and navigate these systems. Defensively, we have great technology. Use this technology. Use the IP that comes from it to be defensive in a licensing way, if you're sued, in a countersuit.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you.

[The Chair, Liberal, Dan Ruimy]

We're going to move to Mr. Masse. You have two minutes.

[Brian Masse, NDP, Windsor West, ON]

Mr. Hinton, one thing we're still struggling with in this committee is the final product at the end of the day, what we want. Again, I equate this with trying to create jobs for Canadians.

Mr. Susalka, just so you know, I live along the border, so I see our economies as integrated and very fruitful in that respect. I buy North American, including my car. Don't tell that to President Trump. At any rate, I view it as “buy North American”.

Maybe I'll start with Mr. Hinton and go across, and then end with Mr. Porter.

If there were one thing, low-hanging fruit, that we could do right now to help, what would it be? I know it's a tough question.

[James Hinton]

Well, you're saying one thing. I'm going to say four quick things.

IP education is the beginning. We need to at least know what we don't know. The second level is IP generation. We need to capture more IP. I guess I'll cut it off at three. The third thing we need to do is generate freedom to operate, and the patent collective is an example of that. These are three things that we can easily do.

Myra Tawfik at Windsor law school is working on IP education. There are all sorts of different mechanisms for generating IP, and the patent collective is something we've researched to ensure more freedom to operate. Those are three things we can do right away. As I said, Myra Tawfik at the University of Windsor has been doing a lot of great work in that area.

[Brian Masse, NDP, Windsor West, ON]

Excellent.

Mr. Susalka.

[Stephen Susalka]

If you think about the development of inventions and commercialization, the nexus there is the technology transfer professional. Low-hanging fruit that actually doesn't cost anything is recognizing that the unique skill set of science, business, and law exists within technology transfer professionals. Having mechanisms where those technology transfer practitioners from around Canada come together, such as this June 25 meeting, are great resources to allow the transfer of ideas, approaches, contacts, and template agreements, to allow for better technology transfer within Canada. I would suggest encouraging the connection of technology transfer professionals throughout, such as at events that we do at AUTM and elsewhere.

[Brian Masse, NDP, Windsor West, ON]

Thank you.

Mr. Porter.

[Kenneth Porter]

Help us keep the small companies that we're creating in Canada, and that relates directly to investment. Direct investment from the government is great, but so is helping to attract investors from around the world here to Canada to see our companies and invest in them here.

[Brian Masse, NDP, Windsor West, ON]

Thank you very much, gentlemen.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

We're going to move to Mr. Baylis. You have seven minutes, and unless there are other questions, that will be the last question.

[Frank Baylis, Liberal, Pierrefonds—Dollard, QC]

Thank you.

I'd like to swing back and talk some more about the technology transfer offices. I'll start off with Mr. Susalka.

A big part of AUTM is best practices. When you're a business, you want to be easy to do business with. Businesses want to deal with someone who is easy to do business with, so when we talk about doing business with universities, I want my contract to be easy, and I want the person with whom I'm talking to get what I'm talking about.

You look at best practices both on contracting and on training technology transfer officers. Can you expand on that?

[Stephen Susalka]

Sure. Again, this is right in AUTM's wheelhouse. We provide training opportunities, whether they are webinars or in-person professional development opportunities, to share best practices that are created and implemented in technology transfer offices around the world. That is a wonderful aspect of AUTM.

One of the other things to recognize is that the technology transfer landscape system is constantly changing. New decisions on patents, etc., require a change in approach for technology transfer. That is a critical piece of that training.

We've talked about template agreements in the past. Template agreements are sometimes challenging to incorporate between universities, but they do provide key points. Again, it's this knowledge dissemination that we talked about earlier. It's a great way to share approaches that are used at different institutions.

I can expand on any aspect of that, if you'd like.

[Frank Baylis, Liberal, Pierrefonds—Dollard, QC]

I'm interested in the contractual things, simplifying them. If I'm a business person and I have to do business with three universities, I don't want to get three lawyers and three.... Is there standardization that we could look at within the contracting between a business and a given university?