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Opportunities for Biotechnology-Based Business in Atlantic Canada
January 1997
Consultations were undertaken with 28 biotechnology firms and 43 public sector agencies engaged in
bioscience activities. The study reports on the views and opinions of the private and public sector stakeholders
consulted. While surveys have been undertaken in the past to characterize Canada's biotechnology industry,
this is the first time that individual biotechnology entrepreneurs in the region have been consulted directly
on the future of their industry.
Biotechnology business has emerged more slowly in Canada and in the Atlantic region than in the United
States (U.S.). Biotechnology businesses in the region are primarily small individual entrepreneur-driven companies.
Fifteen of the 28 companies consulted, primarily those in the medical, aquaculture and environmental areas,
reported annual sales in excess of $500,000. The businesses with sales of less than $500,000 tend to be in the
process of commercializing science developed and/or modified by public institutions. It is estimated that there
are more than 100 private sector bioscience businesses in Atlantic Canada, generating gross revenues of more
than $50 million and employing more than 1500 people.
Biotechnology is defined as the application of scientific and biological principles for the alteration of substances by
biological agents with the aim of providing goods and services.
The majority of biotechnology firms in the Atlantic region are clustered near universities, public research and
development laboratories and teaching hospitals located in: St. John's, Newfoundland; Halifax, Nova Scotia;
Charlottetown, Prince Edward Island; and Fredericton, New Brunswick. Many of the biotechnology firms consulted
were founded by university scientists who recognized the economic potential of a technology and moved to
commercialize it. Health and aquaculture-related biotechnology businesses account for the largest number of firms.
Agricultural and environmental applications are well established; industrial applications of forest biotechnologies,
however, have been slow to happen.
A well developed network of universities and government laboratories supply science to entrepreneurs in the region.
The Dalhousie and Memorial University medical faculties are productive sources of medical science and the Atlantic
Veterinary College (AVC) is an important source of aquacultural technologies. Government laboratories such as the
N.B. Research and Productivity Council (RPC), the P.E.I. Food Technology Centre and the Nova Scotia Agriculture
College (NSAC) provide important technology development support as does the university-owned Huntsman Marine
Sciences Centre. Federal departmental laboratories include the Canadian Forest Service (CFS) laboratory in Fredericton,
the Fisheries and Oceans Canada (DFO) research station in St. Andrews, the National Research Council (NRC) Institute
for Marine Biosciences in Halifax, and Agriculture and Agri-Food Canada (AAFC) research centres across the region.
OPPORTUNITIES FOR NEW BUSINESS FORMATION
The study identified a number of private sector business formation opportunities and new biotechnologies awaiting
commercialization. Three general types of commercial bioscience opportunities were identified.
- Adoption of new technologies by existing business: Existing businesses can benefit from bioscience technologies
by integrating them with existing operations to: improve efficiency of production; improve product quality; and diversify
product lines.
- New business operations, based exclusively upon biotechnologies: The commercialization of research
and development work done in the Atlantic region, or elsewhere, offers a second type of business formation opportunity.
Intellectual capital developed here can be put to work to produce new commercial products.
- The development, sale and provision of biotechnology service: This knowledge-based activity offers job
creation and business formation and income-generation opportunities for the region. A number of institutions and firms are
now involved in the business of creating and selling biology-based technologies on the world market.
Opportunities for each of the three types of business noted above were identified in the health sciences, aquaculture,
environment, agri-food and forestry sectors.
The health sciences offer significant opportunities for commercialization of bioscience technologies. The world class
medical research facilities of Dalhousie and Memorial and the excellent research and commercialization thrust at these
universities provides a fertile environment for future product and business growth. Opportunities exist to increase
market share in pharmaceutical clinical trials, diagnostic test kits, and in blood fractionation processes. Similar
opportunities exist in the animal health sector and in the use of animal products for human health purposes.
The aquaculture sector is comparatively new and its current rate of growth is indeed remarkable. Solid biotechnology
business growth has taken place in fish health, toxin analysis, development of antifreeze proteins and forensic services.
Additional opportunities will become available in species diversification as problems related to genetically engineered
species are overcome and as regulatory hurdles are cleared; for example, in transgenic salmon, domesticated halibut
and triploid Arctic Char.
The environment industry offers bright prospects for commercialization of biotechnology applications. Established firms
are capitalizing on opportunities in sewage and water treatment, soil remediation, household and industrial waste
treatment and composting. The market opportunities are international, based on the intellectual capital and process
skills in the region. The microorganisms which are the workhorses of many potential environmental applications can be
readily reproduced in Atlantic Canada.
There are significant business opportunities in veterinary products, cattle semen and embryos, clonal production of
virus-free potato stocks, strawberry and raspberry nursery stock, and selected ornamentals. The development and production
of improved plant and animal species and the recovery of byproducts from the red meat processing industry offer business
potential in the human health sector. Integrated biological processes, such as the addition of "de-odorase" to animal feeds,
can be used to reduce odours, resolve animal waste disposal problems, improve production efficiency and also offer business
opportunities.
Forestry opportunities are limited at this time. Businesses in the sector are moving from a dependence on traditional chemical
technologies to biologically-based alternatives for forest pest control. Reforestation, based on genetically superior, disease and
pest-resistant tree forms, such as those developed by the CFS and currently being tested by a major forestry company in New
Brunswick, offer private sector industrial development potentials.
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