Last Minute Lifeline Thrown to R&D and IP at Imminent Risk of Shut-Down (COVID-19)

May 15, 2020
By Noel Courage

The Canadian government just announced $450 million in financial support for research institutes, such as those at hospitals and universities. It is primarily a temporary wage support for research workers. It will also cover costs of maintaining research assets, such as research equipment and lab facilities. The funds will additionally help pay to restart R&D after physical distancing measures are lifted. The funding will be distributed through federal grant agencies (details to be determined1). A press release is here.

Research workers at these institutes were facing imminent lay off due to industry funding and charitable research funding drying up after the COVID-19 crisis started. A gap in the government’s prior wage subsidy2 treated these workers as public servants, ineligible for the wage subsidy, even though the bulk of their financial support and salary comes from private funding. One hospital system, University Health Network (“UHN”), estimated that it lost $6 million of funding in a single month due to COVID-19-related shortfalls. For more background, see my prior article, “Keep the Bright Lights of Medical Research On

The government announcement also singled out a couple of research institutes as examples of innovators that produce innovation that drives economy and fights COVID-19. These institutes were the Toronto SickKids Research Institute and the Montreal Clinical Research Institute. SickKids has a long background of innovation in health. For example, nutritionally fortified baby cereal is a product that many parents rely on today, and it seems like it has always been around. It hasn’t – in the 1930s, three doctors at Toronto’s Hospital for Sick Children (SickKids) created Pablum, the first baby cereal that was enriched with vitamins and minerals. In another landmark research accomplishment, the cystic fibrosis gene was discovered at the hospital in the 1980’s. Current research successes range from health and nutrition interventions in low-income countries, to high tech nuclear magnetic resonance (“NMR”) techniques for studying molecules. The SickKids Industry Partnerships and Commercialization Office helps protect IP and translate innovation into new products and services for healthcare. The Montreal Clinical Research Institute has a strong focus on clinical care research in cardiovascular diseases, diabetes and hypertension. It also engages in technology transfer of innovations from benchtop to patient.

In providing this support, the government recognized that it is critical to maintain research talent. Although this program is going to be adding to federal government debt in the short term, the financial support is an investment to support the post-COVID-19 economic recovery.

1 Research institutions eligible for federal grant funding are eligible for the new program. 

2 Canada Emergency Response Benefit (“CERB”).

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