Commercialization trend fuels robust growth in NSERC’s university-industry programs

By Vincent Wright

The growing emphasis by policy makers on the commercialization of publicly funded research appears to be yielding considerable dividends in the realm of university-industry interaction. Recent data compiled by the Natural Sciences and Engineering Research Council (NSERC), the country’s largest university research funding agency, show Canadian businesses and universities aligning in ever-increasing numbers to forge R&D partnerships which are potentially eligible for cost-sharing assistance.

In FY04, the number of new submissions for Industrial Research Chairs (IRCs) more than doubled and applications for university-industry Collaborative R&D (CRD) projects were up 23%.

“Clearly, the priority that governments and universities are attaching to commercialization is resulting in an increase in university-business collaborations, and increased demand for programs that share the cost and risks of research,” notes Janet Walden, vice-president of NSERC’s Research Partnerships Programs (RPP).

Walden says the growing demand is consistent with the outsourcing trend in many industries. “Increasingly, businesses are looking at universities and other research organizations to expand or even replace their R&D capacity”.

NSERC, an early leader in promoting university-industry interactions, is expanding its role in stimulating these collaborations. In the last two years, the range of programs and the funding support for university-business interactions has increased, as has the number of NSERC personnel charged with promoting partnerships and working with the research community and businesses.

“Nonetheless,” observes Walden, “there are still many companies out there that don’t know about the range of opportunities available in working with NSERC and the universities. Business people who aren’t familiar with NSERC are always surprised at the breadth of activity that goes on here.”

Walden says CRDs represent one of NSERC’s core initiatives for promoting commercialization because they emphasize industry’s role as technology pull advocates in communities that are predominantly geared to technology push. “As a technology pull initiative, CRDs allow businesses to identify their technological challenges and where they want to invest their cash and human resources.”

The collaborative dimension of CRDs implies that businesses supply more than cash to access research and technology. She notes that there is a high degree of interaction between the companies and universities, particularly in the training of highly qualified personnel. On average, a single CRD project trains seven students and post-doctoral fellows in technical skills required by industry.

“It’s all about giving students the breadth of experiences necessary to make informed career choices. To do that you have to give them opportunities to work outside the academic research environment,” explains Walden.

Each year more than 600 companies participate in CRDs and most are satisfied with the results. The most recent study of the long-term impacts of CRDs showed that 95% of business respondents considered their participation in the program to be very beneficial.

A re-assuring signal for businesses is that allocations for university-industry interaction are growing at a faster clip than the overall rate of growth in NSERC’s budget. In particular, NSERC will boost the combined budgets for IRCs and CRDs to nearly $47 million this year, up more than 10% or almost twice the growth rate in its overall spending.

IRCs and CRDs, which require cost sharing with industry, have been designated as priorities for new investment by NSERC’s Committee on Research Partnerships, says Walden. “The Committee’s view is that a significant industrial cash and in-kind contribution to the university research project is a strong measure of the industry’s commitment to the collaboration.”

According to one business executive, who also chairs the Committee on Research Partnerships, the CRD program is encouraging incremental spending by many companies. “From that standpoint, it is playing an important role in helping Canada to achieve its Innovation Strategy target of moving toward the top five countries in R&D intensity by 2010”, notes Maurice Moloney, chief scientific officer of Calgary-based SemBioSys Genetics Inc.

“With CRDs, NSERC is stimulating companies to spend R&D dollars that they might not otherwise have spent if they were forced to foot the bill entirely or perform all the work internally. A lot of these companies don’t have significant R&D departments, so NSERC is making up for that shortfall by stimulating interaction with some of the best university researchers in the country.”

Walden notes that even before the CRDs and IRC applications arrive at NSERC, the business partners have already vetted the projects in terms of value for money. Judging by the feedback from industry, the value of the projects goes beyond the advantages of leveraging their research dollars. Companies involved in university collaboration value their interactions with students and their access to ideas, specific expertise and facilities. Risk-sharing is key whether the project involves longer-term research or leads to more immediate product development.

“The growing population of NSERC grantees includes a lot of new faculty coming into the universities who are interested in interacting with industry,” she says. “For researchers and their students, the opportunity to see the direct impact of their research is very rewarding. The flow of knowledge and benefits goes both ways and includes access to prototype capabilities, proprietary data, and specialized materials not available on the open market.”

Flexible timing is a must in making university-industry projects work. For CRDs and IRCs, the path to project approval is not competition-based or constrained by deadlines. Instead, NSERC works with the university researchers and their business partners through an iterative process.

“Our goal is to adjudicate the absolute best proposal,” she says. “We don’t reject incomplete proposals. We work with the proponents until the proposal is in the best possible condition before it is sent out for scientific peer review.” Walden’s group has achieved a three-month turnaround time on roughly 75% of the proposals.

This iterative process during the application phase, combined with the fact that businesses vet the proposals in advance of formal submissions, results in success rates of better than 80% once the IRC and CRD applications reach the adjudication stage. NSERC hopes to maintain these success rates even in the face of rising demand for collaborative university-business research funding.

Vincent Wright is a freelance writer and consultant currently working with NSERC’s Research Partnerships Program.