Canada Life Sciences Breakfast Tampa Feb 2010

Canada: Florida’s Innovation, Investmentand International Biotech Partner

Canada: Florida’s Innovation, Investmentand International Biotech Partner

Life Sciences BreakfastTampa, February 1, 2010

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Overview

� Background� Canada� Florida� Opportunities� Partnerships

BackgroundBackground

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Department of Foreign Affairs andInternational Trade Canada (DFAIT)

Canada has diplomatic and consular offices in over270 locations in 180 countries.

Canada has diplomatic and consular offices in over270 locations in 180 countries.

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Canada’s Footprint in North America

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Canada-U.S. Relations

� Canada and the U.S., a strong partnership

� Geography, History, Security and Business

� Canada is Florida’s #1 Economic Partner

� Common industrial strengths, both dependheavily on international commerce

� Canada 8th largest economy worldwide,Florida about 15th.

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Mexico City

1000 km

500 km

Los Angeles

Denver

Houston

Atlanta

Seattle

Miami

New YorkBoston

Philadelphia

WashingtonBaltimore

DetroitChicago Cleveland

St. LouisPittsburgh

Milwaukee

San Francisco

St. John's

CalgaryVancouver

ReginaHalifax

TorontoMontréal

WinnipegCharlottetown

Edmonton

Victoria Ottawa

Windsor

QuébecFredericton

Saskatoon

Market Access

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Largest Trading Partner

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Investment = Influence

Largest Foreign Investor

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Top Foreign Investors in FloridaBy Value (billions) By Jobs

Germany $3.8 UK 45,200

Japan $3.79 Netherlands 24,000

UK $3.69 Canada 23,100

Canada $2.99 Germany 22,400

Australia $2.77 Japan 21,20

A Top Investor in Florida

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Canadian Businesses

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Canadian Businesses

CanadaCanada

Canadian Health Care Market

� Population: 33.5 million

� High health expenditure: CAD $5170 p.p.

� Long life expectancy: 81.6 years

� $20B drug market, $6B in medical devices, Top 10 globally

� Highly profitable: 13% average profit margins

� Bio-based economy worth $78.3 billion (6.5% of GDP, similar insize to auto) and is responsible for 1 million jobs.

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Industry Snapshot

� Home to 3rd largest Life Sciences industry in the world

� Key strengths:� Biopharmaceutical R&D� Medical devices� Contract services

� Leading scientific excellence

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British Columbia•110 companies

•2500 employees (15%)

•$300 M in annual R&D

• Genomics

Ontario:•220 companies

•6000 employees (38%)

•$650 M in annual R&D

• Stem Cells

• Drug Development

Atlantic Canada•30 companies

•200 employees (1%)

•$25 M in annual R&D

• Nutraceuticals &Marine Bioscience

Quebec•240 companies

•5500 employees (35%)

•$600 M in annual R&D

• Vaccine Research

Prairies•110 companies

•1800 employees (11%)

•$200 M in annual R&D

• Bioimaging

Source: Industry Canada, Statistics Canada, PMPRB. Statistics are for Private sector only

Life Science Clusters In Canada

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Pharmaceutical Industry Snapshot

� $20 billion domesticmarket

� 100+ companies with40,000+ employees

� Market dominated byforeign multinationals

� $1.5 billion in R&Dspending

� Over $4 billion in exports

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Consumer Pharmaceutical Spending

� Total annual spending (prescription drugs): $19.3 billion�Brand name: $15.2 billion (78.6%)�Generic: $4.1 billion (21.4%)

Average cost per prescription, $CAD

Biopharmaceutical Industry Strengths

• Discovery & characterization of therapeutic molecules

• Genomics & proteomics platforms

• Vaccines & immuno-therapeutics

• Regenerative medicine & stem cell research

• Drug formulation & delivery systems

• Oncology/cancer research

• Generic pharmaceuticals

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Major Global Investors in Canada

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Top Sales Leaders in 2008

Ran

k LeadingCompanies

R&D Locationin Canada

TotalPurchases($ Billions)

MarketShare (%)

1 Pfizer Montreal 2.57 12.7

2 Apotex Toronto 1.52 7.5

3 AstraZeneca Montreal 1.34 6.6

4 Johnson & Johnson Toronto 1.10 5.5

5 GlaxoSmithKline Toronto 0.97 4.8

6 Novopharm Toronto 0.83 4.1

7 Novartis Toronto 0.75 3.7

8 Abbott Montreal 0.72 3.6

9 Schering-Plough Montreal 0.68 3.4

10 Roche Montreal 0.62 3.1

Leading Pharmaceutical Companies in Canada in 2008

� Sanofi Pasteur• $100M: vaccine R&D facilities in Toronto

� AstraZeneca Canada Inc.• $10M: pain control research centre in Montreal

� Glaxo Smith Kline (GSK)• $199M: vaccine production facility in Québec• $50M: vaccine R&D headquarters in Montreal

Recent Investments In Canada

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Leading Canadian Companies(Some Examples)

Company Focus

Apotex Generics manufacturing

Amorfix Theranostics: detection of proteinmisfolding

Biovail CNS disorders, pain management, &cardiovascular disease

BioNiche Life Sciences Oncology & animal vaccines

Cangene Mfg. of Ab.’s, peptides, & vaccines

DiaMedica Therapy for Type II diabetes

ImmunoVaccineTechnologies Vaccine innovation & development

Labopharm Controlled-release technologies forsmall molecule drugs

NAEJA NCE discovery & synthesis

Prometic Life Sciences Mfg of natural, recombinant, &synthetic proteins

Theratechnologies Peptide-based therapeutics

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Medical Device Industry Snapshot

� $6 billion market

� $2 billion in exports; $4 billion inimports

� Majority of revenues tomultinationals & distributors

� 200+ developers/manufacturers(90% Canadian owned)

� 94% of firms have < 50 employees

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Major Global Investors in Canada

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Company Focus

Angiotech TAXUS® drug-elutingcoronary stent

ART Optical molecular imaging

EastMed Uresta® bladder support

Epocal Blood diagnostic system inFlexCard™ technology

IMRIS IMRISneuro, Intra-operative MRI

MDS Nordion Radiological imaging &isotopes

NovadaqTechnologies Operating room imaging

Pyng Medical First Aid Devices

Resonant Medical 3D Ultrasound Imaging

Urodynamix Urology diagnostics

Leading Canadian Companies(Some Examples)

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Leading Canadian Companies(Some Examples)

Company Focus

Axela Protein interaction technology

BrightWELLTechologies

Micro-Flow imaging technology(MFI) for cell analysis

DNA Genotek DNA collection & preservationsystems

QBM Cell Science Cryopreserved mouse neurons

Rimon Therapeutics Advanced medical polymers &biomaterials for wound care

Spartan Biosciences Personal DNA analyzers

Spectral Diagnostic Fast testing of Sepsis & WestNile Virus

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Medical Device Strengths

�In-vitro diagnostics

�Medical imaging & analysis

�Nuclear medicine

�Surgical & implant devices

�Advanced materials & nanotechnology

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In-Vitro Diagnostics

Epocal’s Blood DiagnosticSystem in FlexCard™

Technology

Examples Include:

Spectral Diagnostic’sTesting Kit for West Nile

Virus

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Medical Imaging & Analysis

ART’s SoftScanBreast Imaging Device

Examples Include:

IDC’s DR System

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Nuclear Medicine

MDS Nordion’s Glucotrace® for Cardiology andOncology Diagnoses using PET Isotopes

Examples Include:

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Surgical & Implant Devices

Angiotech’sDrug-Eluting

CoronaryStents

Examples Include:

EastMed’s Uresta® for Stress UrinaryIncontinence for Women

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Latest Innovation

World’s First Simulation-Based Brain Surgery Done in Halifax, Canada2009.08

THEN: Provided backup supply services to multinational

pharmaceutical companies

NOW: Grown and become technologically sophisticated

� World renowned for quick recruiting

� Adheres to GCP protocols & generates high quality, robustdata

� 4th worldwide in overall share of global clinical trials

� Top 10 pharmaceutical companies consistently includeCanada in clinical development plans & new drug submissiondata packages

Canada’s Contract Services Subsector

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�Contract manufacturers (CMOs)

�Clinical research organizations(CROs)

�Design & manufacturing of highvalue medical devices (surgicaldevices, implants, imaging systems)

�Analytical services

�Regulatory affairs & compliance

Contract Services: Strengths

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Leading Canadian Companies

Company Focus

Algorithme Pharma Research contracting organization specializing in pre-clinical, phase I & bioequivalencestudies

Allphase Clinical Research Clinical trial management company managing multi-site trials & sourcing trial servicesglobally

Biovectra Manufacturing contracts for both large and small-molecule Advanced PharmaceuticalIngredients (API’s), advanced intermediates, and cGMP bioprocessing reagents

MDS Pharma Service Research contracting organization that provides drug discovery and development services

Therapure BiopharmaManufacturing contractors committed to the development, manufacturing, purification, and

packaging of high-quality biological therapeutics

Wellspring Pharmaceutical Manufacturing contracts for specialized dosage forms for clinical & commercial distribution

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Clinical Trials by Condition

Source: ClinicalTrials.gov, Dec. 2008

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Clinical Trials by Sponsor

FloridaFlorida

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Emerging Biotech Cluster

� Why is Canada interested?� Top 10 US biotech clusters

� US $10b+ NIH funding, most researchintensive country in the world, 50% and 40%of global patent applications in med techand pharma/biotech products, respectively

� Paradigm shift: globalization of industry andBigPharma looking to fill innovation gap asblockbuster revenue cliff approaches

� Weaknesses in Florida� VC funding

� Training/Tertiary Education/Skilled Labour

� Entrepeneurship

OpportunitiesOpportunities

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� Post-recession• Technology based firms need international linkages to position themselves for the

post-recession economy.• By partnering with other countries on science and technology, firms connect to

knowledge, know-how, people, investments and markets abroad.• They also respond to new business model where “biotech clusters will be

redefined away from geography and be more virtual built around diseases,pathways, markets, and unique industry segments”. (Burrill & Co. Biotech 2010 –Life Sciences: Adapting for Success).

� Credit Crunch, Public & Private Capital Drought• VC funding lowest in 15 years both in Canada and the U.S.: ($1 billion in Canada,

$235 million in Florida) – however healthcare surpassed IT or cleantech.• PE/Buyout market: Canada 4th in volume, 18th in value of M&A deals, however

Canadian funds raised close to $20 billion in 2006-2008 so considerable availablecapital to deploy.

• Only 3 biotech IPOs in 2009, but Burrill expects pick-up to 15 IPOs in 2010

Strategic Context

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Five major factorsdrive foreign interest in collaborations

• Strong and stable economy• First-class technological infrastructure• Highly skilled workforce• Lower business and R&D cost structure• Investment incentive programs: the best

research incentives in the world

Attractions include Canada’s:

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Workforce: Educated & Available

Higher Education Achievement

54,0 53,051,4 51,0 50,0

47,8

41,0 41,0 41,0 40,0 40,0 39,8 39,0 39,0

30

35

40

45

50

55

Canada

Japan

Singap

oreSout

h Korea

Israel

Taiwan

Belgium

Irelan

dNorw

ayDen

markSpai

nHon

g Kong

France U.S.

%

Source: IMD, World Competitiveness Yearbook 2008

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Workforce: Educated & Available

Source: IMD, World Competitiveness Yearbook 2008

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Low Labor Costs

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Thriving Clusters

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Quality Living Environment

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Canada: An Innovation Leader

� Canada generates about 4% of global knowledge, as measured byacademic publications, a formidable statistic considering itcomposes only 1% of the global population.

� Canada leads the G7 in public sector research funding on a percapita basis.

� Canada has one of the most generous tax-based supportprograms in the industrialized world through the ScientificResearch & Experimental Development tax credit.

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Canadian Life Sciences Innovation

� Canada’s health science research community consists of over64,000 physicians, 30,000 investigators in 17 medical schools, andover 100 teaching hospitals and research institutes.

� Canadian innovators are internationally recognized for researchand product development excellence in genomics,proteomics,vaccine development, medical devices, regenerative medicine(stem cells), protein engineering, immunotherapies and drugdelivery systems.

� Canada Canadian life sciences discoveries: insulin, pacemaker,sequencing Alzheimer genome & H1N1 genome, adult stem cells,how stem cells become blood cells, embryonic stem cells fromskin, etc.

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Canadian university R&Dfunding programs

• Canadian Institutes of Health Research (CIHR)• Canada Foundation for Innovation (CFI)• Canada Research Chairs (CRC)• Genome Canada• Networks of Centres of Excellence (NCE)• Department of Foreign Affairs and International Trade• National Research Council:

• 15 Industrial Partnership Facilities (IPF)business incubators affiliated with NRC’s 21research institutes -137 firms, 13 graduates 08-09• Industry Research Assistance Program (IRAP)works with 8000 SMEs, youth internships, Angiotech (anti-

inflammation tech) in 5 years $30 milllions 1,500 jobs

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$

Mind Market

Public

Private

Life Sciences

ICT

Clean Tech

Aerospace

Valley of

Death

Innovation and Sector Interface

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� Growth Capital

Investment

2009

TSX: 28 IPOs, $1.8billion

TSX-V: 20 IPOs, $69 million

2010 (projected)

TSX & TSX-V: $4 billion IPO market

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� BioPartnering North America, Vancouver, Jan 24-26, 2010

� BioFinance, Toronto, 6-8 April, 2010

� BioContact, Quebec City, Oct. 6-7, 2010

Events in Canada

PartnershipsPartnerships

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� Stem Cells

Success Stories

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� Drug Development

Success Stories

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� Research/Education/Simulation/Commercialization

Success Stories

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� AIDS/Immunology

Success Stories

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� And more…

Success Stories

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� Tap into Canadian ideas, knowledge and talent – throughstrategic alliances, joint ventures, licensing and technologytransfer agreements, and venture capital as well as public andprivate equity investments.

� Explore the opportunities to make Canadian innovators yourtechnology development and commercialization partners.

Conclusion

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