Other programs supporting technology transfer

In this section, we report on examples of programs that support the life sciences cluster and technology transfer in other jurisdictions. All of these programs were referred to during our interviews by project recipients and key informants, and have been cited as being best practice examples.

What follows in an overview of each program in terms of four key characteristics.

1. Annual budget
2. Ongoing funding source
3. Program delivery
4. Program recipients.

A comparison of WD characteristics to these programs is summarised in Table 10.1. Of particular note from this table: WD is the only organisation that does not provide funds to private companies, and WD’s budget, relative to its mandate, is modest in comparison.

Table 10.1 Comparison of technology support programs across jurisdictions

Organization	Annual Budget	Organization Funding Source	Program Delivery	Program Recipients
Ontario – MaRS Discovery District	N/A	Seed funding: Public & private ongoing funding: real estate, fundraising, & fees for service	Business services, incubator facilities	Companies, members of the innovation network
San Diego – CONNECT	N/A	Private – membership	Business services	Companies
Texas – Emerging Technology Fund	CD$213.34 (US$ 200 million over two years)	Public	Grants, business services, regional centres of innovation & commercialization	Companies or non-profit entities
EU – Framework 7	CD10.8 billion (€7.6 billion annually for seven years)	Public	Loans, grants, business services	Companies, universities and research institutes
Finland – Teke	CD$709.05 million (€500 million annually)	Public	Loans, grants, business services, regional service centres	Companies, universities, and research institutes
Australia – Backing Australia’s Ability Program	CD$745.64 (AU$832 million annually for 10 years)	Public	Loans, grants, business services	Companies
Western Canada – WD	CD$354 million, all programming 2006-2007	Public	Contributions	Universities and research institutes

Ontario – MaRS Discovery District

The MaRS Discovery District was founded in 2005 by a group of public and private cluster donors that included the federal and provincial governments, the University of Toronto, the Ontario Innovation Trust and the City of Toronto. Altogether, this group has raised and / or contributed almost $100 million for the facility with another $130 million secured from other sources towards the estimated total cost of $450 million.

MaRS is a facility intended to co-locate science, business, and capital in one facility thereby creating a critical mass of activity. A not-for-profit organization operates the facility with a focus on the convergence of the life sciences cluster with other technology platforms providing programs and services to assist the commercialization of Ontario life science technology. Funding for the operation is from real estate revenues, fundraising, and fees for service.

MaRS has recently developed a commercialization model in partnership with the Canadian Stem Cell Network to create a translational development company. The company, Aggregate Therapeutics¹, will expand its work in regenerative medicine, build its capacity for commercialization in the field of stem cells and regenerative medicine, and facilitate the private financing of spin-off companies.

San Diego - CONNECT²

CONNECT is a globally recognized public benefits organization that fosters entrepreneurship in the San Diego region by catalyzing, accelerating, and supporting the growth of the most promising technology and life sciences businesses.

UCSD CONNECT began its operations in 1985 s part of the extension program at the University of California at San Diego (UCSD) at the urging of the San Diego business community. Today, CONNECT is an independent, not-for-profit, membership-driven organization widely regarded as the nation's most successful regional entrepreneurial program. CONNECT links high-technology and life science entrepreneurs with the resources they need for success: technology, money, markets, management, partners, and support services.

The CONNECT model has been adopted in other jurisdictions, including Scotland, Denmark, Norway, and Sweden, and Taiwan.
CONNECT is now independent of UCSD and is supported through membership dues, course fees, and corporate underwriting for specific programs.

Texas – Emerging Technology Fund: RCIC,³

In 2005, the State of Texas passed legislation approving the funding of the Emerging Technology Fund. This legislation provides US$200 million dollars over two years in funding to support emerging technology commercialization. The fund is established to develop and diversify the economy of Texas through:

• Expediting innovation and commercialization of research
• Attracting, creating, or expanding private cluster entities that will promote a substantial increase in high-quality jobs
• Increasing higher education applied technology research capabilities.

The fund provides incentives for private or non profit organizations to collaborate with public or private universities on emerging technology projects with a demonstrable economic benefit to the state. The areas eligible for funding include: emerging scientific or technology fields that have a reasonable probability of enhancing the state's national or global economic competitiveness, may result in a medical or scientific breakthrough and guarantee of commercialization or manufacturing in Texas.

To allocate the funds, eight Regional Centers of Innovation and Commercialization have been set up across Texas to receive funding applications. RCIC’s provide:

• Applied Research and Development activities
• Commercialization of the applied R&D
• Incubators for new business and expansion of existing business resulting from applied R&D
• Workforce Training for business resulting from the applied R&D.

European Union – FP7 (Seventh Framework Programme) ^{4, 5, 6,7}

The primary instrument for research funding in Europe are the Framework Programs which have been in place since 1984. The European strategy around the life sciences is tied closely to the Lisbon strategy, formulated in 2000, which strives to make Europe the most competitive knowledge-based economy in the world by 2010. The idea of a European Research Area (ERA) supports a coordinated research strategy and improved integration in research capabilities. ERA is intended to be an internal market for science and technology that will support scientific excellence, competitiveness and collaboration, while at the same time supporting economic growth through research.

The current Framework Program, FP7’s budget is €50.5 billion, with approximately €1 billion per year of the FP7 budget allocated to basic research.

The key priorities for Europe from 2007 to 2013 are research, innovation and technology. A complementary program to FP7 is the Competitiveness and Innovation Framework Programme, which is a €4.2 billion program to address competitiveness of European firms through the development of instruments to create a supportive environment for innovative firms, support clusters, and improve access to finance. There are four programs for FP7 as listed below.

1. Cooperation (€32,413 million) – Includes the following related to life sciences: health; food, agriculture and fisheries and biotechnology; nanosciences, nanotechnology, materials and new production technologies. The Cooperation program also includes the Joint Technology Initiatives, which are large scale projects driven by industry that may be implemented with financing from public and private sources. The Joint Technology Initiatives support large projects requiring substantial investment and collaboration to achieve long-term success
2. Ideas (€7,510 million) – Dedicated to basic research that is implemented by the newly-formed European Research Council. There is no requirement in this program for partnerships across countries, and research may be conducted in any field of science or technology
3. People (€4,750 million) - The People program supports research competencies, career development and research excellence through several activities such as initial researcher training and trans-national European fellowships
4. Capacities (€4,097 million) – There are six knowledge areas in the Capacity program, which is intended to help Europe achieve its full research potential and become a knowledge-based economy:
   • Research Infrastructure
   • Research for the Benefit of SMEs
   • Regions of Knowledge – (a new area for FP7 which provides resources to facilitate networking of all types of researchers in a given region)
   • Research Potential
   • Science in Society
   • International Cooperation.

Participation in FP7 is open to universities, research centres, multinational corporations, small and medium sized enterprises (SMEs), public administrations and individuals from across the world. New to FP7 is risk-sharing finance, which will provide support for private investors in research projects.

Finland - Tekes⁸

Tekes is the Finnish Funding Agency for Technology & Innovation that supports innovative and risk-intensive R&D. Teke’s primary objective is to promote the competitiveness of Finland’s industry and service cluster through the use of innovative and risk-intensive technology. The agency funds R&D projects in companies, universities and research institutes and directly assists companies with their search for ideas, assistance with business plans, and conducting relevant research.
Tekes follows six objectives:

1. R&D activities strengthen the knowledge base
2. Innovative high-growth companies are successful
3. Regional development
4. Innovation is increasingly international
5. Industries renew and increase their productivity
6. Innovation activities boost societal well-being.

Tekes invests more than €460 million annually in R&D projects at companies, universities, and research institutes in over 2,100 projects employing 320 people of which 150 are technology and business experts. Funding is provided from the state budget through the Ministry of Trade and Industry.

Tekes administers more than 20 technology programs involving 2,000 companies and over 500 research organizations. Fifty percent of funding is channelled through technology programs while the other half through competitive project funding through 14 regional centres located throughout the country.

The organization follows two streams of strategic focus: technology and application. The strategic technology focus is on ICT, biotechnology, nanotechnology, material technology, and business competence while the strategic application focus on areas such as the environment and energy, health and well-being, work and leisure, security and safety, services, and regenerating products and business concepts.

Tekes has six international offices located in: Beijing, Brussels, Tokyo, San Jose, Shanghai, and Washington D.C. Almost 40 percent of Tekes projects involve international networking with Tekes developing networks in Europe, North America, and Asia. Partners include world-class technology companies, universities, and research institutes such as the University of California, Berkeley, MIT, and Stanford University in the US.

Australia – Backing Australia’s Ability ^9,10

In May 2004, under the Backing Australia’s Ability program, the Australian Government announced an investment of A$5.3 billion into their science and innovation program, bringing total funding to A$8.3 billion over 10 years from 2001. An additional $20 million was allocated from these funds for the National Biotechnology Strategy which focuses on realizing the benefits from biotechnology research. Descriptions of programs included in the initiative and their funding levels are provided in Table 10.2.

Collaboration is a key factor supporting Australia’s biotechnology capabilities. There are significant partnership between governments, public and private research institutions, hospitals, universities and industry. In addition, Australia has biotechnology precincts in most states and territories, aimed at fostering collaboration.

Table 10.2 - Australia Funding Programs for Life Science Commercialization

Table 10.2	Australia Funding Programs for Life Science Commercialization
The Commercial Ready Program	Commercial Ready, will inject $200 million per year until 2011, offering competitive grants from $50,000 to $5 million for innovative research and development, proof-of-concept, adoption of new technologies, and early-stage commercialization activities.
Commercializing Emerging Technologies Program (COMET)	COMET is a A$100 million program to improve the potential for successful commercialization of innovation products, processes and services by early-stage growth companies and spin-off companies from research agencies. COMET continues to be one of the Australian Government’s most successful programs. Almost 1,259 companies have received assistance totalling more than $65 million and have raised more than $365 million in equity. More than 300 strategic alliances have been formed and have achieved more than 920 licensing, manufacturing or production outcomes.
The R&D Tax Concession	A broad-based, market driven tax concession which allows companies to deduct up to 125 % of qualifying expenditure incurred on R&D activities when lodging their corporate tax return. A 175 % Premium (Incremental) R&D Tax Concession and R&D Tax Offset are also available in certain circumstances.
Pooled Development Funds (PFD) Program	PFD encourages investors to provide patient equity capital to small and medium sized enterprises particularly those in the seed and early stages of development. Since the program began in July 1992, PDFs have invested more than A$550 million into over 400 Australian companies. There were 116 registered PDFs at the end of 2002-03.
Innovation Investment Fund (IIF)	IIF is a venture capital program that invests in nine private cluster venture capital funds to assist small companies in the early stages of development to commercialize the outcomes of Australia’s strong research and development capability. The Innovation Investment Funds have collectively invested in 65 individual companies.
Pre-Seed Fund (PSF)	PSF provides finance to enable universities and public cluster research agencies to take proposals to a venture capital ready stage. Private cluster fund managers with commercial experiences in developing new ventures manage the four pre-seed funds. Since its commencement in November 2002, the PSF has made eight investments in companies with projects that have a total value of over A$2.4 million.

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¹ Aggregate Therapeutics Inc. is a development-stage regenerative-medicine company that has an exclusive first right to negotiate the commercialization of stem cell technologies from the laboratories of 37 leading Canadian scientists. http://aggregatetx.com/

² CONNECT webpage, www.connect.org/.

³ State Legislative Best Practices in Support of Bioscience Industry Development, Council of State Bioscience Associations, November 2006.

⁴ European Commission, Life sciences and biotechnology: A strategy for Europe, 2002

5 European Commission, Research Directorate-General, Sixth Framework Programme: Frequently asked questions

6 CORDIS, FP6: Life sciences, genomics and biotechnology for health, Introduction.

7 European Commission, the Seventh Framework Programme (FP7): Taking European Research to the Forefront, 2007.

8 Veli-Pekka Saarnivaara, Published in High Technology Finland 2007, www.hightechfinland.com/content.aspx?article=549

9 Global Partners, Australian Biotechnology 2004, Biotechnology Australia, Department of Industry Tourism and Resources.

10 BioForum, Edition 19, Quarter 2, FY07, PricewaterhouseCoopers LLP