This report examines the shape of the health technology industry in Canada with a focus on three specific questions: Does Canada actually have a problem with health tech commercialization? If so, how extensive is that problem? And what is causing it?
What we found is that the US has five times as much capital on a per population basis available to both new and growing companies. The gap grows even further for more established businesses: our neighbour has six times as much investment capital for companies that are scaling. Within the US, Massachusetts is the clear winner at overall capital and in the scale-up of companies. Relative to Ontario, it has 43 times more total capital and 51 times more investment resources for growth companies.
In terms of public expenditure on research, an annual expenditure of $7.3 B of health tech research winds its way through the system, gets augmented by privately funded research, of approximately $500 M, to produce about $3.5 billion of revenue annually. That’s $3.5 billion of revenue from $7.3 billion of research.
Our examination of the system found that:
- There is no alignment of research dollars and researchers with commercialization objectives.
- From the perspective of the entrepreneur, the system for commercializing health technology is a byzantine and flawed system with multiple overlapping, competitive, and duplicated parts with funding and assistance gaps.
- The healthcare system is not aligned to purchase the innovation that comes out of the health tech system, and in fact, can act as a brake on innovation.
You can get a full copy of the report here.