A new report from the CD Howe Institute argues that the federal government should abandon its current policy of encouraging academic researchers to become more industrially relevant and instruct the granting councils to "increase the emphasis on academic excellence over perceived practical utility". It also strongly supports the recent reorientation of the National Research Council (NRC) and recommends that its transformation should go much further by fully implementing a key recommendation of the Jenkins Panel (R$, October 31/11) — transforming it into a "pan-Canadian technology transfer organization".

The report — authored by Canadian economist Peter Howitt, a professor emeritus at George Brown Univ and a CD Howe fellow-in-residence — argues that business R&D spending can only be increased by ensuring that firms are able to interact with the world's best scientific minds who, in turn, are permitted to engage in curiosity-driven research. Companies will be more likely to collaborate with world class research expertise when their areas of discovery coincide with the problems and challenges facing industry.

Howitt notes that the leading US universities are more highly ranked than their Canadian counterparts and are therefore more attractive to firms seeking to collaborate.

"The shortfall of business R&D constitutes the most obvious source of Canada's relative lack of productivity in technology transfer. If Canadian businesses continue to rely on universities to do the kind of development activities for which universities do not have a comparative advantage, the quality of Canadian universities will be compromised and the process of technology transfer will suffer." — CD Howe report

In addition, top-ranked US universities are more entrepreneurial which in turn enhances their productivity.

"In order for us (Canada) to fully realize the potential benefits from university-academia interactions it takes not just university research but also business research," states the report. "It is doubtful that Canada will be able to close the productivity gap with the US in technology transfer until businesses start to play their part instead of relying on universities to do more than their share."

The report also argues that universities can better help industry commercialize research if their technology transfer offices (TTOs) focus less on spin-offs and licencing income and more on fostering faculty interactions with business and promoting access to specialized infrastructure.

"The overarching priority for Canada should be to attract the best researchers in the world ... The greatest benefit to society will come from scientists for whom practical utility and individual financial reward are minor considerations. The best way to attract such scientists to Canada is to redirect our research support towards the problems that are most challenging from a scientific point of view, not towards those that bureaucrats view as most likely to lead to commercial success." — CD Howe report

"There is growing evidence from US studies to the effect that most of the technology spillover from university research comes through channels other than patents and licenses," it states, referencing a Carnegie-Mellon Survey on industrial R&D in which businesses were asked to identify the most effective channels through which they benefitted from academic research. "In most industries the leading answers were publications, informal exchanges and communications with scientists, and consulting. Patents and licenses were hardly mentioned at all."

The report points to the creation of so-called "supra-university institutions" such as MaRS Innovation, the Centre for Drug Research and Development, Green Centre Canada and the Canadian Digital Media Network as effective conduits for boosting industry-academia interaction.

Combined with changes in university patenting regulations, these institutions could lead to greater competition for technology transfer services if researchers are permitted to operate as free agents, much like those at the Univ of Waterloo.

"University science works best when the universities keep abreast of the problems and challenges facing private industry, and keep informed about new technologies that are continually arising and posing new scientific challenges. Academic research that maintains an ivory-tower distance from the broader community tends to become sterile." — CD Howe report

Transforming the NRC

Another method for providing more competition for academic TTOs would be to implement the recommendation of the Jenkins Panel regarding the NRC, effectively transforming its institutes "from independent research agencies into agencies for fostering collaboration between universities and businesses."

Howitt says he's supportive of the reorientation of the NRC towards commercially relevant research but he says it should go further to "actively engage university researchers in this process rather than expanding the independent research capacity of the NRC". This could be achieved by offering concierge and other services that would allow it to effectively compete with university TTOs.

Curiously, the report does not mention that NRC received funding to start a concierge service in the 2012 Budget, nor that a similar role is already played by the Industry Technology Advisors of the Industrial Research Assistance Program.

The report notes that US universities more fully integrate teaching and research and that research funding that currently flows to NRC could be more effectively used by directing it "towards universities that can benefit from and contribute to synergies with teaching".

The report also delves into the issue of patenting and examines the benefits and drawbacks of open access publications. It argues that all three granting councils should adopt the policy of the Canadian Institutes of Health Research in requiring all articles stemming from CIHR-sponsored research be made freely accessible within one year of publication.

It notes that CIHR allows researchers to use their grant money to pay for article processes charges levied by open access journals to compensate for the drop in subscription revenue.

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