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Biotech companies to feel loss of research council expertise

By: Martin Cash

Posted: 04/19/2012 1:00 AM | Comments: 0

This week, three of the city's developing life sciences/medical device companies disclosed major breakthroughs.

It was also the week a significant portion of the city's scientists working for the National Research Council learned they will be laid off in July.

One of the companies, privately held Monteris Medical -- which just hired a new CEO, veteran Minneapolis-based commercialization expert John Schellhorn -- has used some NRC services through its development process.

The fortunes of Monteris, Miraculins Inc. and Kane Biotech are not now tied to the NRC, but it has been a supportive resource for a lot of Manitoba companies over the years.

Because of the skills involved in the creation and commercialization of technology, a specialized network to support those enterprises is necessary.

The NRC's most high-profile commercial spinoff in Winnipeg is probably Imris Inc. The technology for its magnetic resonance imaging medical surgery application comes directly from work that NRC did.

But the NRC's presence in the technology community looms large.

Charles Drouin, the NRC's chief media relations officer in Ottawa, said the NRC is terminating its activities in hardware development for medical imaging, claiming that type of activity is better served in clinical and academic settings. That decision means 47 scientists in Winnipeg and seven in Calgary will be laid off.

The ideal scenario would be to have public-sector money and resources prime the pump until the engine is running and would then no longer be required. But the fact remains that outside of the capital-rich innovation centres such as Boston, Silicon Valley and even Montreal, ongoing support for capital-intensive technology development remains an iffy business.

Manitoba politicians love to talk about the growing biotech sector in the province, but it is small and vulnerable and made more so when a sizable pool of its senior scientists loses their jobs.

Last month, Miraculins Inc. raised $2.5 million in financing after its painless, non-invasive skin cholesterol-diagnostic system achieved regulatory clearance.

Christopher Moreau, Miraculins' CEO, said financing was "incredibly important for the company."

It is also a small sum when it comes to the world of medical technologies. Even still, it will allow Miraculins to continue along the road to commercialization with a couple of distribution companies it has newly partnered with to get the diagnostic device into pharmacies and doctors' offices.

This week Kane Biotech, a Winnipeg company that is developing unique products to prevent and remove biofilms, announced the completion of a project with the U.S army's Walter Reed Army Institute of Research, no less.

Biofilms are a major cause of a number of serious medical problems, including chronic infections and medical-device-related infections.

The army is trying to create a better wound-care ointment for soldiers on the battlefield by combining Kane's antibiofilm enzyme, called DispersinB, with an antimicrobial the U.S. army has developed itself.

Kane's own business-development resources helped forge the partnership with an elite partner such as the U.S. army -- one assumes it doesn't partner with just anyone -- and its proprietary technology has proven to be effective in the first round of lab testing.

Gord Froehlich, Kane's CEO, said, "It is a huge validation for them to be working with us versus thousands of other possibilities."

But it doesn't allow Kane to automatically go out and raise more money to continue its work.

"Access to capital is by far the most challenging thing for any biotech company," Froehlich said.

Last year, Monteris closed a round of private financing and is going hard selling its sophisticated technology -- just renamed NeuroBlate -- to treat deep-seated brain tumours that would typically be deemed inoperable.

Its marketing projections a year ago proved to be overly optimistic, but it has regrouped and remains committed to the technology.

These Winnipeg companies have survived against the odds.

But realistically, for Manitoba life sciences companies to properly germinate to the point where they can be truly independent, an infrastructure of support is required.

The NRC provided a solid base. How big a void it will leave remains to be seen.

martin.cash@freepress.mb.ca

Republished from the Winnipeg Free Press print edition April 19, 2012 B5

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About Martin Cash

Martin Cash joined the Free Press in 1987 as the paper’s business columnist.

He has spent two decades chronicling the city’s business affairs.

Martin won a citation of merit from the National Newspaper Awards in 2001 for his coverage of the strike and subsequent multi-million-dollar union settlement at the Versatile tractor plant. He has also received honours and awards for his work on agriculture and technology development in Manitoba.

Martin has written a coffee-table book about the commercial and industrial make-up of the city, called Winnipeg: A Prairie Portrait.

Martin Cash on Twitter: @martycash

martin.cash@freepress.mb.ca

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