Innovation and Science: the Canadian perspective

1. Innovation and Science:the Canadian perspective Presentation to: Tetrapartite 2007 Dr. Marc Fortin Assistant Deputy Minister

2. In 2005, AAFC undertook nation-wide science consultations • The Science consultations with stakeholders in October-November 2005 addressed science directions, research priorities, and the role of government in meeting the changing needs of the sector. The consultations involved: • 11 Regional consultations – 300 representatives from producer organizations, processors, provincial and municipal governments • The first Agriculture Science & Innovation Symposium –120 senior officials from producer, processor, and other agri-industry organizations, as well as provincial, university, and other federal department representatives • Bilateral consultations – A series of approximately 40 consultations with key stakeholders in addition to on-line consultations for all Canadians through AAFC’s Science Consultations website The Result: AAFC Science and Innovation Strategy - May 2006

3. The AAFC Science & Innovation Strategy outlined seven goals for short term impact Goal 1 ― Focus science and innovation on national priorities Goal 2 ― Pursue excellence in science and science management Goal 3 ― Build partnerships that will lead to concrete results Goal 4 ― Extend the integrated national science and innovation capacity to the bioeconomy Goal 5 ― Accelerate the adoption and commercialization of scientific knowledge Goal 6 ― Enhance leadership and stewardship supported by enhanced cooperation and . communication Goal 7 ― Improve decision-making through science knowledge and advice

4. Goal 1 ― Focus science and innovation on national priorities AAFC has identified seven national priorities • Enhancing human health and wellness through food and nutrition and innovative products • Enhancing the quality of food and the safety of the food system • Enhancing security and protection of the food supply • Enhancing economic benefits for all stakeholders • Enhancing environmental performance of the agricultural system • Understanding and conserving Canadian bioresources • Developing new opportunities for agriculture from bioresources

5. Goal 2 ― Pursue excellence in science and science management Four major initiatives were undertaken in the past year: • Peer reviews of research activities at AAFC • In June 2006, AAFC launched an external peer review process aimed at: • assuring the best possible investment of public funds; • ensuring scientific excellence through competition of ideas; and • providing international caliber science in the agriculture and agri-food sector. • For the first time in its history, AAFC Research Branch is now submitting all its research activities to external peer-review prior to allocating funding to research projects. • Implementation of a more direct management accountability system • The management responsibilities of scientific directors and director generals are more focused on delivering on the Department’s priorities. • Recruitment of new research scientists • Renewal of our research equipment

6. Goal 3 ― Build partnerships that will lead to concrete results Saskatoon Research Center 200 AAFC staff on the University of Saskatchewan campus • AAFC has adopted and adapted • various models • co-locations • embedded staff in universities • joint institutes (joint building, equipment and staff) with other government departments • AAFC is enhancing international • science and innovation • Collaboration and partnership • initiatives to: • create opportunities • extend Canada’s international influence and improve our trade relations

7. Goal 4 ― Extend science and innovation capacity to the bioeconomy • AAFC announced the Agricultural Bioproducts Innovation Program (ABIP) • ABIP is a $145 million program designed to support research networks and encourage the development of clusters for the advancement of a sustainable and profitable Canadian bioeconomy. • It is the first major injection of new research funds in several years. • As the Science and Innovation Strategy indicated, these new research efforts will put an increased emphasis on research partnerships that will allow for the creation of the best research teams in Canada. • Close to $1 Billion of funding requests were received.

8. Goal 5 ― Accelerate the adoption and commercialization of scientific knowledge • The Matching Investment Initiative (MII) program is being rejuvenated to enhance its effectiveness and flexibility and improve its delivery. Rebranding and rejuvenating the MII will: • Enhance innovation capacities across the value chain • Introduce a new funding formula to cater to a wider variety of industry needs • Build long-term AAFC-industry relationships • Simplify agreements will be put in place • Welcome applications throughout the year • The MII program has been a success. For the period 1994-2002: • MII funded 3000 projects involving 1400 industry groups between 1994 and 2002 • MII leveraged $235 million AAFC direct cash investment with matching industry cash and in-kind investment (50:50) • Net economic benefits from MII funded research have been estimated to be at least $2.2 billion

9. Goal 6 ― Enhance innovation coordination • AAFC is working on setting up a new cooperation, coordination and communication mechanism with the provinces and universities and with other science and research suppliers • This new mechanism, the National Coordination and Innovation Council, will: • identify a common vision and priority areas for stimulating growth in the sector, giving the different stakeholders a focal point for their science and innovation skills; • help optimize scientific resources and improve their coordination and management to create a national integrated agricultural research and science system; • encourage science and research suppliers to participate in forming partnerships; and • mobilize private- and public-sector investors to get them to participate in the creation and promotion of new outlets in the agricultural sector.

10. Goal 7 ― Improve decision-making through science • Over the next year, we will focus our efforts on key communications initiatives • An External Science Communications Strategy is being developed to provide an overall strategic framework for managing, integrating and coordinating the wide variety of activities to ensure transparent, open communications with Canadians and the World. • The Internet Website for AAFC Research (The Science Lane) is being redesigned to ensure easy access for external audiences to reliable, timely and trusted information about AAFC Science.

11. The Agricultural Policy Framework set out goals in three broad areas • Realign Public Science Resources • Realign and increase investments to support science and innovation in priority areas, as well as in biomass, bio-product and bio-process research • Increase the level of investment in innovation in agricultural and bio-products • Coordinate Along the Value Chain • Expand and strengthen domestic and international linkages between the science and innovation community and the sector • Improve technology transfer, coordination, communication and collaboration across all players of the innovation chain • Create an Innovation Climate • Accelerate development and adoption of innovation while maintaining an effective science-based and transparent regulatory system • Ensure availability of human resources and infrastructure needed for science and innovation • Foster a supportive climate for investment, technology transfer and commercialization • Better utilization of intellectual property from publicly supported research

12. While investments were modest, some success was achieved in realigning public science resources • Realign Public Science Resources - Results Achieved and Lessons Learned • Encouraged university and industry partners to align with national priorities through partnership and multidisciplinary projects and aided these collaborations by matching investment initiatives - but faced multiple barriers to true partnerships • New investments and programs have resulted in a patchwork of uncoordinated programming and increased administrative burden • In the absence of new and sustained investment, achieving new priorities can be difficult

13. S & I programming focused predominantly on value chain coordination • Coordinate Along the Value Chain - Results Achieved and Lessons Learned • Twenty-three value chain development projects identified and developed new market opportunities (e.g., soy, flax, pulses, milk, potatoes, fibres, …) • Strategic leadership and planning are essential in bringing all players along the value chain together to develop new market opportunities • Broker capacity to better connect entrepreneurs with pre-commercialization services needs to be enhanced • Value chain development and coordination is weak in new market areas such as bioproducts • The APF strong national focus made it difficult to move into near-market opportunities at the regional level, where most innovation occurs • There is a growing recognition of the need for a broader-based strategic foresight and planning mechanism among governments, academia and industry to identify market opportunities

14. A sustained effort is required to create an innovation climate • Create an Innovation Climate - Results Achieved and Lessons Learned • Some measures were initiated in key areas, such as regulation and intellectual property, but remains to be done • All elements of the Innovation Climate must be systematically addressed, including highly qualified personnel, investment availability, regulation, intellectual property, trade barriers, and access to international knowledge • To attract investment, Canada needs a transparent, timely and consistent science-based regulatory system that is able to address innovative and novel products • At the same time, socio-economic policy issues surrounding the development and application of new technologies need to be addressed

15. Consultations have confirmed that innovation is the cornerstone of competitiveness and prosperity, but more needs to be done • Regulation must be able to address innovative and novel products in a timely and transparent manner • A pre-commercialization bottleneck exists from the lab bench to market entry • Building an innovation culture is dynamic, it should not be managed in five year intervals, and it requires consistent and stable commitment over time • Current APF programming is siloed and lacks integration • Lengthy program approval processes impede innovation • The sector should position itself as a solution provider

16. Support for innovation INNOVATION CONTINUUM DISCOVERY PHASE PRE-ADOPTION / PRE-COMMERCIALIZATION PHASE MARKETING PHASE Market Development Basic Research Applied Research Prototype Development Demonstration Full Scale Market Ready Product Development Market Entry • A systems approach is needed to stimulate innovation and accelerate the adoption/transformation of knowledge into market-ready products • Changes are needed in the regulatory and intellectual property framework • A patchwork of programming along the continuum, among departments and stakeholders, increases administrative burden and impedes effectiveness • A pre-commercialization bottleneck exists from the lab bench to market entry • We need to enhance focus on improving the business climate • We need to start to implement a comprehensive national foresight and innovation coordination mechanism • We need to explore alternative delivery models

17. Things to stop doing…. • Stop being reactive, waiting for the sector to come forward with project ideas • we are losing an opportunity for leadership that would implement real change • Stop trying to improve the sector as a whole and focus on the entrepreneurial leaders • we are diversifying our efforts at the expense of sector diversification • Stop implementing programming focused on specific parts of the innovation continuum • we are increasing administrative burden and complexity at the expense of client service and impact

18. Since the APF was originally developed, the federal policy context has shifted… • Advantage Canada • Focus is on industry competitiveness and economic growth achieved through innovation and productivity improvement. There is a strong focus on university-business science collaborations. The notion that excellence will be obtained through the competition of ideas is presented as a key theme. • Budget 2007 • Continues the messaging from Advantage Canada. Government investment in universities through Granting Councils is increased only modestly. Granting Councils are essentially the means by which excellence through competition of ideas will be achieved. Innovation supported by a focus on entrepreneurship, knowledge development and management and enhancing HQP is a key thrust. • Federal Laboratory Infrastructure Project • Treasury Board is leading a multi-department review of federal laboratory infrastructure. It is apparent that significant reinvestment is required and this project is attempting to determine the current condition of federal laboratory capacity in the context of government science priorities. • Federal S&T Strategy will put emphasis on: • Promoting world class excellence • Focusing on priorities • Encouraging partnerships

19. For the Next Generation, an integrated policy direction is proposed with four key themes Agri-Innovation System Competitiveness Barriers to trade S&T advances Supportive Business Environment Innovation R&D Proof of Concept Prod. Development Market Development Commercialization Enabling Infrastructure Sector Capacity to Innovate Foresight Capacity & Coordination Consumer sophistication Market receptivity • Foresight Capacity and Coordination: To identify emerging challenges and opportunities for the long term competitiveness of the sector and mobilize its capacity to address key issues • Enabling Infrastructure: To enable a foundation that accelerates the flow of new ideas to the marketplace • Supportive Business Environment: To promote a climate that fosters innovation • Sector Capacity to Innovate: To foster strategic planning, entrepreneurial leadership, and knowledge needed to succeed • Integrated programmingthat emphasizes coordination along the innovation continuum

20. These four themes work together to identify opportunities for the sector, to develop these opportunities,… • Foresight Capacity and Coordination – to identify the opportunities • Establish a National Innovation Coordination Council with a foresight process and associated fora to address priority issues • Enabling Infrastructure – to develop the opportunities • Develop centres of excellence to optimize collective public-private investment in, and mobilize capacity to address, national and regional sector priorities • Technology and Innovation Partnership centres would combine national and regional strengths and leverage federal-provincial investments with academic and private partners. Technology and Innovation Partnership centres would focus on development and demonstration of applications that can be readily transferred to stakeholders. • Federal support would catalyze the development of Research Clusters and networks in areas outside of, but complementary to, traditional agricultural activities. • Bolster capacity to identify and use global science, technology and market intelligence • Technological scanning for international market, trade and scientific opportunities would be linked to scientific and societal foresight. Develop scanning capacity for innovation, assess the potential value to Canada and develop country strategies that will deepen our domestic capacity to exploit knowledge and trade opportunities. • Enhance pre-commercialization services and associated broker capacity within the sector to assist in the commercialization of products • Develop an AAFC innovation-industry liaison function to facilitate connections • A national network of Technology and Innovation Partnership Centres would leverage discoveries in one area to create products and services in widely diverse areas beyond where the original discoverer has expertise.

21. … to accelerate the necessary investment, and finally, to enable the sector to act to realize these opportunities • Supportive Business Environment – to accelerate investment in opportunities • Foster a transparent, timely and cutting-edge science-based regulatory system • Federally-catalyzed Research Clusters would develop the basis for science-based regulatory processes. • Technology and Innovation Partnership centres would have the mandate to support SMEs in meeting regulatory requirements. • Ensure a globally competitive approach to intellectual property management • Explore new models of IP portfolio management to maximize competitive outcomes. • Develop a policy framework for advancing the bioeconomy • Sector Capacity to Innovate – to realize the opportunities • Enhance the capacity of leaders to champion new ideas and develop value chain strategies for market opportunities • Ensure the sector has the right skills to support innovation and enable it to compete in the knowledge economy • Establish an independent forum to foster dialogue with Canadians on emerging technologies • Position the sector as a “sector of opportunity” to better attract new graduates, experienced entrepreneurs, and investors to opportunities within the sector

22. Alternate delivery models Foresight & Forums AAFC, Provincial, Industry andAcademic Partnership Research Networks Innovation & Technology Platforms Inc. AAFC Research Broker – Planning Agri-Innovation - Adoption Value Chain Roundtables IP Portfolio Demonstration Markets and Trade Industry liaison Commercialization International S&I Prospecting