No. 2012-02

Canada’s universities have increasingly gained recognition as major drivers of innovation and Research and Development (R&D) activity in Canada. As columnist and blogger Peter Lindfield recently notedi,  university-industry partnerships “have resulted in the creation of many competitive spin-off companies.” Indeed, Lindfield argues, “It is not an overstatement to say that in Canada university research has been a cornerstone of innovation in every growth industry over the last 60 years.”

In Atlantic Canada, university-led R&D has been a key to economic growth across the region. Successful knowledge-based industry clusters with strong ties to the region’s universities include Information and Communications Technology (ICT) in New Brunswick; Marine and Life Sciences in Nova Scotia, Ocean Technology in Newfoundland and Labrador; and Bio-Medical Sciences in Prince Edward Island.  Three regional success stories illustrate the success of this approach:
  • Radian6, a social media monitoring company that now has global reach, was founded as a result of research and collaboration at the University of New Brunswick. A few years after the company was formed, the firm was sold to Salesforce.com for $326 million. Radian6 is still headquartered at the Fredericton Knowledge Park.
  • Halifax-based Ocean Nutrition Canada (ONC), a marine-based nutraceutical company, has leveraged local research capacity to build its business since the firm was formed in 1997. Specifically, it commercialized the work of Professor Robert Ackman of Dalhousie University’s Faculty of Engineering. Today, ONC is the world’s largest manufacturer of Omega-3 EPA/DHA from fish oil, with more than 100 billion servings consumed globally. This May, Ocean Nutrition was sold to a Dutch-based multinational food company for $540 million. 
  • Virtual Marine Technology (VMT) is a St. John’s-based company that emerged from research conducted at Memorial University of Newfoundland and the National Research Council.  SurvivalQuest, VMT’s lifeboat training simulator, was the first survival craft operation simulator in the world to be approved as a Class ‘S’ Simulator by Det Norske Veritas (DVS). VMT maintains a collaborative research relationship with Memorial University and the Marine Institute. 
The Association of Atlantic Universities (AAU) believes that the Radian6 and Ocean Nutrition stories are illustrative of the success of a collaborative model that is unique to this region. Larry Sampson, the CEO of the New Brunswick Information Technology Council, has noted that Radian6 is part and parcel of a significant New Brunswick success storyii: The ICT sector in the province has grown 43 per cent over the past decade, or double the overall rate of economic growth. 

Ocean Nutrition founding CEO Robert Orriii praises the collaborative model that helped the company succeed. That model involves a partnership that includes the universities, the private sector, research institutions and governments. Indeed, Orr has said that the firm could only have thrived in Nova Scotia, based on the contributions of the National Research Council, ACOA, Nova Scotia Business Inc., universities and community colleges, and the private sector. 
It may be true, as Canadian business leader Gwyn Morgan recently wroteiv, that there is a need to improve research collaboration between the nation`s universities and business. But the Radian6 and ONC stories do demonstrate that AAU members have also embraced partnerships and funding arrangements with corporate partners. ONC founder John Risley clearly believes there is great growth potential in a business model that puts researchers together with entrepreneursv.  Risley has pointed out that the region’s well-trained research scientists are a great asset for companies which want to achieve ONC-like successes.
In Atlantic Canada, the private sector and the universities increasingly work inside a collaborative model that works. It is essential that this approach, unique to Atlantic Canada, be maintained as the federal government adapts its support programs for R&D and innovation. Strong decision-making capability must be maintained inside the region if it is to sustain its record of excellence in the commercialization of university-based research. This will mean the ongoing presence of strong regional branches of federal institutions, including the NRC and ACOA.
Like the Association of Universities and Colleges of Canada (AUCC), the AAU supports the federal government`s decision to maintain core funding for research chairs in Canada. As the AUCC has stated, the 2012 federal budget includes “strategic investments in research and innovation.”vi Those investments include:
  • An additional $500-million for the Canada Foundation for Innovation over the next five years.
  • $40 million over two years for Canada’s Advanced Research and Innovation Network (CANARIE). These funds will support the nation’s ultra-high speed innovation network.
  • $10 million over two years to link Canadians to global research networks through the Canadian Institute for Advanced Research.
At the same time, the AAU believes the federal government should continue to support basic research in addition to directing funds to business-related R&D. No less an authority than Research in Motion co-founder Mike Lazaridis, the engineer who brought the world the smart phone, praises the value of pure research.vii
In a recent presentation in Halifax, Lazaridis said that if Einstein had been meeting perceived market needs in 1905, he would have been studying the problem of horse manure in cities instead of publishing his seminal work on mass and energy and time and space. Few foresaw that the problem of urban horse manure would be resolved in a few years by the advent of the automobile, just as few people today can know what basic research will result in breakthrough science of Einsteinian significance.
AAU member institutions will continue to work with federal, provincial and private sector partners on the most effective ways to deliver assistance to emerging sectors inside the region.  The AAU will also advocate on behalf of federal policies that are tailored to the specific needs of Atlantic Canada, where successful knowledge-based sectors are emerging in smaller regional centres with specific needs. 
Our region has developed a model of collaboration that has delivered both research excellence and dramatic commercial success. The region’s universities and community colleges, for instance, have created Springboard Atlantic (www.springboardatlantic.ca), which helps transform research from the laboratory into commercial products in the marketplace. Springboard members increase research commercialization collaborations, support the creation of new and improved products, streamline processes and help develop a skilled and competitive workforce. 
Sustaining the co-operative spirit of Atlantic Canada’s merit-based model will enable the universities of Atlantic Canada to continue to drive regional R&D and innovation; to serve as ideas factories; and to produce the sort of entrepreneurial-minded researchers who will help this region succeed.

Key Questions for Consideration 

  • How should Atlantic Canada build on the success of its collaborative approach to university based R&D and innovation?
  • How can the federal and provincial governments and the private sector best support the commercialization of innovative R&D in Atlantic Canada? 

Have an opinion or question about this issue?
Contact us: policypaper@atlanticuniversities.ca

iPeter Lindfield, Universities are the Lifeblood of Innovation, The Telegraph-Journal, April 13, 2012
iiLarry Sampson, Despite Growth, ICT Scene Mixed, The Telegraph-Journal, April 16, 2012
iiiallnovascotia.com, Ocean Nutrition Coup, May 22, 2012
ivGwyn Morgan, Questions arise from the world of university research, April 16, 2012 
vBrett Bundale, Innovation from farm to IT applauded, The Chronicle Herald, May 25, 2012
viAUCC Media Release, Universities give high marks for smart investments, March 29, 2012
viiEditorial, Nova Scotia has a chance to turn it up a notch, The Chronicle Herald, May 29, 2012