Science and Research Committee on March 21st, 2023

[The Vice-Chair, Bloc, Maxime Blanchette-Joncas]

Colleagues, I call this meeting to order.

Welcome to meeting number 34 of the House of Commons Standing Committee on Science and Research.

Today's meeting is taking place in a hybrid format pursuant to the House order of June 23, 2022. Members may therefore attend in person in the room, or remotely using the Zoom application.

Today, we are going to continue our study of the support for the commercialization of intellectual property.

In order for things to proceed smoothly, I'd like to make a few comments for the benefit of witnesses and members.

Please wait until I recognize you by name before speaking. For those taking part by video conference, click on the microphone icon to activate your mike, and please mute yourself when you are not speaking.

For interpretation, those on Zoom can select, at the bottom corner of your screen, English, French or Floor. Those in the room can use the earpiece and select the desired channel.

I remind you that all comments should be addressed through the chair.

For members in the room, if you wish to speak, please raise your hand. For the members on Zoom, please use the “raise hand” function. The clerk and I will do our best to maintain a speaking order when appropriate. We thank the members for their patience and understanding.

In accordance with our routine motions, I am informing the committee that all of our witnesses have completed the required connection tests in advance of this meeting.

I now would like to welcome today's witnesses.

We are joined today by Ms. Gail Murphy, Vice-President of Research and Innovation at the University of British Columbia, and Mr. William Ghali, Vice-President of Research at the University of Calgary.

Each of you will have five minutes for your opening remarks.

Professor Murphy, you have the floor.

[Dr. Gail Murphy, Vice-President, Research and Innovation, University of British Columbia]

Thank you, Mr. Chair.

Thank you for inviting me to join you today.

As you've heard, I'm Gail Murphy, vice-president of research and innovation at the University of British Columbia. I'm also a professor of computer science and a founder of Tasktop Technologies, a 200-person software company recently acquired by Planview.

I'm joining you today from the traditional ancestral and unceded territories of the Musqueam people, for centuries a place of learning and discovery.

UBC is the second-largest research university in Canada, with nearly 70,000 students and more than 17,000 faculty and staff at campuses in Vancouver and Kelowna and sites throughout British Columbia.

UBC is consistently ranked among the top 50 in the world and attracts over $700 million in research funding each year. UBC researchers are responsible for tremendous contributions in new technologies, life sciences, the environment, clean energy, public policy and economic growth.

UBC also ranked first in the world in the category of industry, innovation and infrastructure in the 2022 Times Higher Education impact rankings and has the highest number of active licences for intellectual property developed from research in Canada.

Research universities produce IP in many different forms, including patents, copyrights and trademarks. Different research universities approach IP differently. At UBC we have an institutional model in which researchers disclose inventions that are proprietary in nature to the university. The university then works with those researchers to find a way to mobilize the IP, taking into account personal preferences, the field of research and the economic sector.

Generally, IP mobilization happens through licensing, spinoff companies or knowledge exchange. At UBC, we successfully and continually deploy IP through each of these mechanisms. B.C.'s thriving biotech sector, as one example, is in large part based on our research mobilization success, such as the recent UBC spinoff company AbCellera, which currently has a market cap of over $2 billion and more than 500 employees.

To give a sense of scale, last year UBC filed 353 patents, had 622 active technology licences and undertook approximately 1,400 sponsored research projects, most with industrial partners.

UBC is also exploring new forms of partnerships, particularly with large Canadian companies, creating more open-ended research collaborations to solve industrial challenges. As one example, a 5G partnership with Rogers has enabled projects in wildfire management, as well as in telemedicine, to be able to reach patients in remote and rural communities.

While we have seen success in generating and mobilizing IP, Canada can build on this by investing in four areas: people, partnership, pilot funding and patenting.

First, there's an urgent need for further investment in graduate students, as they are critical to moving inventions and ideas from the university into start-ups and Canadian companies. This was certainly true for the company I co-founded in Canada. In Canada, we lag in the production of graduate students and are simply not funding those graduate students at internationally competitive levels. We are at significant risk of losing talented young people to other jurisdictions. To attract and produce more graduate students, the federal government needs to increase both scholarship and tri-agency funding for research, most of which goes towards graduate students.

Second, we need to better and more completely support partnerships. While many helpful programs exist, gaps do remain. One of the key gaps is support for institutions to cultivate, develop and sustain partnerships, such as the one between UBC and Rogers that I noted earlier.

Third, there is an opportunity to fund the scaling up of proof-of-concept research results into pilot technologies that are appropriate for spinoffs and investor funding, by, for example, taking promising new chemical or biological processes from a test tube to something closer in scale to commercial production.

Fourth and finally, there is an opportunity to increase support for patent writing and filing at universities. While Canadian research universities are very well known for their ability to discover and to invent, we are limited in our ability to protect IP through patents due to a lack of funding.

I have had the opportunity to bring research results from software engineering, my research area, to the market, and one of the most rewarding parts of my career has been seeing our ideas really impact the business of software development. Collaboration between academia and the private sector is growing exponentially, but we need to move from a stream of ad hoc initiatives to a focused national imperative that properly and purposefully supports this work for a more resilient economy and thriving society.

Thank you for this opportunity. I look forward to your questions.

[The Vice-Chair, Bloc, Maxime Blanchette-Joncas]

Thank you, Professor Murphy.

Professor Ghali, you now have the floor for five minutes.

[William Ghali, Vice-President, Research, University of Calgary]

Thank you, Mr. Chair.

I am pleased to have had the opportunity to address the Committee today.

I am Dr. William Ghali, vice-president of research at the University of Calgary.

I am joining you from the traditional territories of the Treaty 7 first nations of southern Alberta. Calgary is also home to the Métis Nation of Alberta, region 3.

Like Dr. Murphy before me, I am a stakeholder from a Canadian post-secondary institution. More specifically, I am a vice-president for research, a role that oversees not only research but also my university’s innovation ecosystem.

The backdrop of Canadian innovation and commercialization unfortunately isn’t great. While Canada scores in the top 10 countries for basic research by various traditional measures, the impact of our innovations, assessed by metrics such as patents, licences and company creation, is modest.

Our post-secondary sector presents a paradox. Data show that our universities are sought after internationally because of the strong reputation of our educational programs. Our post-secondary research is also very strong, and we achieve internationally leading levels of scientific publication and citation per capita, yet, despite this, Canada lags in those previously mentioned innovation metrics. Why is this?

One challenge may be the sometimes competing missions of universities. Our provincially funded universities exist, after all, to deliver educational programs. We also need to retain our professoriate and uphold campus research infrastructure: laboratories, IT systems and so on.

In the face of budget pressures—and universities in several provinces have faced that—something has to give. In such situations, innovation expenditures are sometimes seen to be a luxury, nice to have but not necessarily must-haves. Clearly, there needs to be a change of mindset. Knowledge economies, in their fullest form, are fuelled by research universities if and only if the research in those universities is mobilized toward innovation.

At the University of Calgary, we have activated a number of programs that attempt to demystify and enable commercialization pathways. We have the Hunter hub for entrepreneurial thinking, which does exactly what its name suggests, campus-wide. We have an exciting cohort program called e2i, evolve to innovate, which exposes large cohorts to group innovation training, early-stage exposure. We have a more intensive and personalized academic entrepreneurs in residence program, which provides longitudinal mentorship to selected teams by experienced research entrepreneurs. We also have a set of UCeed funds, evergreening venture funds established through philanthropy.

Is it all working? Maybe yes. The University of Calgary has been number one in Canada in start-up company creation from the university for each of the last two years, according to AUTM, with about 20 new companies created annually. Many of these companies have gone on to achieve maturity and growth, create jobs and attract capital.

I know this is a parliamentary committee and questions of science policy are paramount here, and I think there is an important federal government role here. Several federal government programs are noteworthy. These include a number of PrairiesCan investments in my region and ISED’s new ElevateIP program, for which the University of Calgary will be one of the hubs.

I’m also optimistic about the lab-to-market program announced in budget 2022. I look forward to hearing the specifics of that program. I also, of course, want to see the details of the new Canada innovation corporation, from which I hope there will be strong program connections with Canada's post-secondary sector.

In closing, I’ll point to Singapore and Switzerland, two quintessential knowledge economies. In both, federal government funding plays a major role. In Singapore, the two major universities, NUS and NTU, have impressive tech transfer systems fuelled by substantial government investments. In Switzerland, two federally funded R and D institutions, EPFL and ETH, shine particularly brightly as innovation exemplars internationally.

I am optimistic about some of the trends I see, both nationally and, of course, at my institution. I am hopeful that this committee and the federal government will continue to explore ways to advance Canada’s knowledge economy.

Thank you for your attention.

[The Vice-Chair, Bloc, Maxime Blanchette-Joncas]

Thank you, Professor Ghali.

We will now begin the first round of questions.

Mr. Williams, you have six minutes.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Thank you very much, Chair.

It's nice to see you in this role.

Thank you to our witnesses for joining us today. This is a fascinating study, and we're happy to have you both here.

IP commercialization in Canadian universities is often referred to as the “valley of death”, so I'm wondering if each of you could perhaps comment on where this great term came from. Why do we have such a tough time commercializing IP from our universities?

Professor Murphy, perhaps you want to go first, and then Dr. Ghali.

[Dr. Gail Murphy]

Thank you very much.

I think sometimes we overstate what you've termed the “valley of death”. I think we have many examples of where we are successfully moving new ideas and commercialization policy out into use within our economy and our other sectors.

There are places where there could be more support. Dr. Ghali mentioned a few of them. There are places where we need to have more ability to work longitudinally with companies in Canada to be able to move ideas into use. For our more entrepreneurial mind, it's spinoff individuals. There are significant challenges, as I mentioned, in moving research results from the lab into use by showing a capability of doing it at a pilot scale.

There are also challenges for those companies, particularly in the current climate, for raising their initial capital. The more capital-intensive your company is going to be, the more difficult it tends to be to grow in Canada, to put in place the infrastructure to be able to get your product into a commercial form.

The final thing I would mention—

[Ryan Williams, Conservative, Bay of Quinte, ON]

My main question in all of this is, how are you tracking this right now? Is there a way you're tracking the funding for commercialization? Do you check in with companies later? Do you track jobs? How are we tracking commercialization, as a whole, from universities?

[Dr. Gail Murphy]

We track both of those things.

As Dr. Ghali mentioned, there is also an organization called AUTM, which tracks licences and patents, but we also follow up with our spinoff companies to track the amount of investment over time and the number of jobs that were created in Canada.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Okay. Thank you.

Dr. Ghali, I know you have a spin on this. You talked about something that is really important to me—entrepreneurs in residence. Can you tell me how that program works, and how those mentors are involved with helping to grow companies?

[William Ghali]

Yes. Thanks for the question.

That particular program is one where one key element is the people who are the mentors in the program. These are individuals who have generated IP through research and scholarships at the university, and they have undertaken a journey themselves of commercialization or knowledge transfer that has, in some cases, created social enterprises and social innovations, but in other cases technology-based innovations.

Those mentors have one role that relates to simply spotting IP and speaking to colleagues in a generic way that there's a journey that could be taken, a career step they might consider that doesn't necessarily grasp onto a specific innovation or a specific IP element of interest. They are later involved in the actual mentorship of teams that have something they want to bring forward. They do have an intake where they consider the concept that a group has in mind, and if that concept is mature enough, it goes into the academic entrepreneurs in residence program.

If the concept is less mature, they are potentially diverted to our evolve to innovate program, which is a less IP-focused program. It's more about mindset and pathways.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Doctor, you talked about 20 companies being created annually. Is that normal for universities, or is that something you're excelling at, through AUTM, as you were saying, perhaps because of the entrepreneur in residence program?

[William Ghali]

Yes, I think there has been a change. For us, it is an increase over prior years. In earlier years, there were fewer than 10 companies formed. I don't think doubling happens coincidentally. Of course, I'm an epidemiologist in my research, so I have to be cautious with attribution, but I think it is partially because of the Hunter hub and the whole discourse around entrepreneurship, campus-wide, that has shifted the mindset.

I think it is the suite of programs. The academic entrepreneurs intervention, I think, is particularly powerful, as you've noted in your questioning, but so is the UCeed fund, which is an incentive, after all, to position oneself to go after money and to advance a concept. We also have our tech transfer entity at Innovate Calgary, which has had a significant enhancement in our institutional investments for lots of things.

[Ryan Williams, Conservative, Bay of Quinte, ON]

I have less than a minute left for each of you, so I'll ask this very briefly.

Is there a federal policy regulation or piece of legislation that is hindering innovation for Canada right now? Perhaps there's something that the Americans, for instance, are seeing in the universities that we are not seeing in Canada?

[William Ghali]

Dr. Murphy, I'll let you speak first.

[Dr. Gail Murphy]

I'm not aware of any particular legislation. It is more of a mindset in Canada of, for instance, making sure that we buy from our Canadian companies that are starting out so that they have an ability to generate cash flow and revenue and continue their growth.

[William Ghali]

I also don't necessarily have a policy or legislation that hinders, but perhaps a culture of incentivizing and potentially some tangible programs that incentivize could be science policy considerations at this committee.

[Ryan Williams, Conservative, Bay of Quinte, ON]

Thank you.

[The Vice-Chair, Bloc, Maxime Blanchette-Joncas]

Thank you, Mr. Williams.

Ms. Bradford now has the floor for six minutes.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Thank you, Mr. Chair.

My apologies for my laryngitis this morning. I will try to keep my questions short and hopefully your answers are long.

I'll ask these questions of each of you. Maybe Dr. Murphy can start.

What initiatives can be explored to strengthen links between research conducted in post-secondary institutions and Canadian industry needs?

[Dr. Gail Murphy]

Thank you very much for the question, and I hope you feel better soon.

I mentioned partnerships. I think partnerships are very important to form between Canadian industry and academic institutions. Not only are we able to take advantage of talented groups of individuals within the universities to help solve company problems, but the company also finds a source of talent to bring into their company later.

We tend to do the partnerships that I'm mentioning at the scale of the university. The company brings a set of problems, and then we work with groups of researchers in a foundry model to brainstorm different approaches to be able to forward the ideas of that company and then work collaboratively on them.

It means that we bring together multidisciplinary teams. We're finding that new partners are coming and saying that they would like a partnership model like company X had because they are seeing results from it that they are really interested in.

[William Ghali]

I would just jump in and echo Dr. Murphy. Partnership funding programs are something that I would welcome, speaking as an N of one, but also as a vice-president of research. We know that the NSERC programs and the alliance programs are very good for bridging researchers within post-secondary institutions with companies. There is a bidirectional consideration of strategically important research initiatives and questions.

In the health space, which is my own space, there used to be a program called the eHIPP program—eHealth innovation partnership program—that looked for partnerships between health systems, industry and post-secondary institutions. Those programs are at that “valley of death” that was mentioned in the previous line of questioning.

I think partnership programs are really a valuable thing. There should be some fundamental science, of course, in the funding system that doesn't necessarily anchor in partnerships, but partnerships are powerful.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Thank you.

What are businesses and academic institutions doing to support the commercialization of IP? What obstacles do they face in this regard? What are they doing to overcome them?

Dr. Murphy, do you want to start?

[Dr. Gail Murphy]

There are two different routes we take in working with industry.

Some of our projects are sponsored research where the industry is providing some funding, and perhaps some funding is coming from the federal government, and there's a project that is undertaken as a result of that. Mitacs programs are another example of this form of sponsored interaction. In those cases, there's really more onus on the companies to figure out how the new ideas and approaches might fit into their product lines and then take it forward. Often we're building on existing IP that a company has and we're helping to further that to the next generation.

The other category we've been referring to today is really in the spinoff of [Technical difficulty—Editor] companies directly out of university inventions. In those cases, or in many cases, the universities, as Dr. Ghali was mentioning, are trying to incubate and accelerate along the pathway. We also have entrepreneurship programs and accelerator programs to try to incubate it.

Where companies often face a challenge is making that jump from being within the university environment to being on their own and starting to grow into large companies. In general, in Canada, we see great success with our start-up companies. They get to a certain size, but then trying to grow into a much larger company is a challenge. Part of that is some of our industrial policy, in which there are cut-offs for the sizes of companies that are able to participate in certain programs. The more we can smooth that, the more we will be able to grow our companies more successfully.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Yes, I think the ramping-up stage is always a challenge. Part of the ElevateIP program is, hopefully, to address that.

Dr. Ghali, go ahead.