Bioindustrial Innovation Centre having major impact but sustainability remains a concern

With its objective of transforming the economy of southwestern Ontario's Sarnia-Lambton region into a leading bio-based economy, the Bioindustrial Innovation Centre (BIC) is chalking up several early achievements, making it one of the more successful programs in the Centres of Excellence for Commercialization and Research (CECR) program. BIC has made 11 investments worth $5.5 million in companies that have raised $140 million in total, with many more opportunities in the pipeline awaiting new sources of funding.

By focusing on bridging the gap between research and the marketplace in chemicals and energy from biomass, BIC is leveraging the strengths of the Sarnia region — once known as Chemical Valley in its heyday — to create new companies and grow existing firms with facilities and financial assistance geared towards commercialization.

"My objective is to build Sarnia as a key cluster around bio-based technologies," says Dr Murray McLaughlin, executive director of BIC and president/CEO of the SCA. "This initiative will become a model for this sort of approach to bio-based commercialization. There are three or four other locations in Canada that make sense and all are chemistry based."

BIC was awarded $15 million in the first CECR competition and is now in its fourth year of a five-year funding cycle. In addition to operating research and pilot scale-up facilities through a contract with the County Lambton Community Development Park (CLCDC), it also seed funds promising firms through the Sustainable Chemistry Alliance (SCA), an outgrowth of the Ontario Chemical Value Chain initiative. The CECR funding is split evenly between the two operations.

BIC has also been instrumental in attracting Minneapolis MN-headquartered BioAmber to the region where it has built a full scale plant using its purification process and chemical catalysis for converting renewable feedstocks into chemicals to replace petroleum-derived chemicals. The company licensed its technology from the US Department of Energy, took it to France where it built a demonstration facility and ultimately chose Sarnia as the site for its first North American production facility.

Initial success notwithstanding, BIC is in a quandary common to all CECRs. When the program was launched, no provisions were made for funding renewal. That means BIC will have to secure alternate financing or close up shop unless the federal government changes the rules to allow CECRs to apply for renewal. Despite repeated requests for clarification, the government has been silent on the issue.

"We're going to have to get funding from somewhere because no CECRs will be self sufficient after five years," says McLaughlin, adding that he is currently trying to establish a bridge fund that would allow the SCA to make investments for another two years. "For BIC, its hard assets are owned by the Sarnia Research Park but if there's no new funding, our efforts to attract companies will be jeopardized. The SCA has made good investments and the returns will begin this year but they won't be sufficient to recycle money to new projects. It needs another five years of funding."

McLaughlin says there are another 30 to 40 companies in the SCA pipeline with about 10 that are "investable" if SCA had any funds remaining.

BIC has also looked at the potential for establishing a commercialization seed fund but McLaughlin says the market conditions make such a move difficult. He adds that he is involved with the Guelph-based BioEnterprise which has been working to establish a $100-millions venture capital fund over the past several months.

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