MaRS Innovation taps into provincial funding with Discovery Toronto merger

Toronto scores major commercialization engine

The innovation engine that's being built to improve Toronto's weak commercialization track record just got bigger with the integration of BioDiscovery Toronto (BDT) into MaRS Innovation (MI). Two years in the planning stages, the amalgamation brings together a suite of tools and funding to position MI as the most powerful organization for moving research discoveries to market in the country.

Funded with a blend of federal, provincial and other funding, MI is explicitly designed on the BDT model, which was formed in 2004 to commercialize biomedical discoveries emanating from Toronto's plethora of universities and research hospitals by increasing early-stage deal flow, leveraging funding and creating spin-out companies. A parallel organization — Technology Transfer Toronto (TTT) — was also launched at about the same time to provide proof-of-principle (PoP) services for discoveries in the physical sciences.

The announcement of the federal Centres of Excellence for Commercialization and Research (CECR) in 2007 sparked the idea for a powerful, combined commercialization engine that built on federal support, the targeted successes of BDT and the Ontario government's increasing emphasis on return on investment from its research investments.

"Our objective is a larger organization representing all fields of research working for commercialization. We wanted to create a vehicle that had scale and could address the needs of such a large research base," says Dr David Shindler, the former executive director of BDT. "MI is beginning to be big enough to handle that potential deal flow although venture capital is still a big issue."

With its successful application for CECR funding (R$, Feb 15 & October 7/08), MI also began to administer funds on behalf of the Ontario Ministry of Research and Innovation (MRI), creating federal-provincial synergy that's becoming apparent in a number of other commercialization vehicles. Examples include Green Centre Canada and the Centre for Commercialization of Research — the latter affiliated with the Ontario Centres of Excellence (OCE) organization.

Last year, MI brought in Dr Rafi Hofstein — an experienced Israeli venture capitalist and technology transfer specialist — to oversee the merged operation and drive it to the next level. Hofstein says the expertise developed at BDT and TTT in the areas of tech transfer, PoP funding and mentorship have been invaluable in positioning MI as a globally significant player in commercialization.

"We have $30 million for commercialization and we have identified the missing link — taking super-early ideas and putting them through PoP funding," says Hofstein. "BDT and TTT have great management. They set the tone and established the foundation and we are walking on those efforts."

To facilitate the merger, MRI flowed its support for BDT and TTT through OCE and extended its support through to the end of FY10-11, at which time a decision must be made on whether to renew its Industry-Academic Collaboration Program or establish a new funding mechanism.

"I know with a high degree of confidence that the OCE/MRI conversation is leading us quite safely beyond FY11," says Hofstein, adding that a new program that addresses the same functions is likely. "MI will be accessible for these activities and OCE is empowered by MRI to support us and many others. We're just Toronto and there are several other clusters (in the province)."

leverage growing research capacity

Toronto's strength in biomedical research has expanded in recent years as a result of increased investments from all levels of government, generating 10% annual growth for the past five years. BDT is also responsible for ensuring that some of that research capacity gravitates to the marketplace. Its PoP activities achieved a 4:1 leverage, resulting in 35 projects receiving nearly $5.8 million. Shindler says MI should be able to achieve that kind of leverage over the next five years as it incorporates the best practices of BDT and TTT.

"It's becoming a well-oiled machine. That's what we set our minds to do," he says. "We created the integration plan and it is now complete. All we need is final (BDT) board and AGM ratifications."

MI has a stated objective of becoming a top-ranked North American commercialization organization within 10 years. By bundling IP and offering a range of business and technology development services, it has attracted nearly $700,000 in funding from its 14 member organizations that represent the cream the Great Toronto Area's (GTA) research institutions. Formal collaborations are also being finalized with other CECRs, including the Vancouver-based Centre for Drug Research and Development and Kingston-based Green Centre Canada.

The hope is that, by re-inventing the research pipeline and making it more attractive for business, commercialization opportunities will increase accordingly.

"With MI, the value chain is well-connected and tidied up so that bright ideas from hospitals and universities are in much better shape (for commercialization)," says Hofstein. "It's about early-stage funding and showcasing the GTA to the world that will help attract venture capital and companies."

MI is one of five technology transfer networks in Ontario that provide companies and academic institutions with PoP and enhanced market services and specialized personnel. The other provincial networks are PARTEQ (Kingston), Ottawa Technology Transfer Network, C4 (southwestern Ontario) and Ontario Partnership for Innovation and Commercialization (OPIC) (northern Ontario). The networks fall under the umbrella of the OCE program which provides coordination and flow-through funding from MRI.

OCE senior VP Mario Thomas the tech transfer networks and the new Ontario Networks of Excellence (ONE) are part of the province's streamlining efforts to make its innovation services more client focused.

"OCE is charged with all industry-academic programs. It's a key pillar in ONE and has a relationship with MaRS Discovery for tech transfer and proof-of-principle," says Thomas. "CCR is a division of OCE and like MI it's a CECR. MI works upstream from us in the area of disclosures from inventors in universities. CCR works with companies linked to academia. All the pieces are connected"

Thomas says the blend of federal-provincial funding is "brilliant" and is leading to synergies that were previously unattainable.

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