Ottawa announces $7M investment into new health-tech procurement model in B.C., other provinces

Ottawa has invested $7 million into the creation of a $20-million project aimed at linking life-sciences start-ups directly with health care institutions like Vancouver Coastal Health to ease the scaling process.

Officials said the federal government will invest $3.5 million each through Western Economic Diversification Canada and FedDev Ontario into the establishment of the CAN Health Network separately in Ontario and the four western provinces.

CAN, officials say, aims to become an “integrated market” where early adopter health institutions can create cooperative efforts quickly with start-ups and small- and medium-sized enterprises (SMEs) developing new medical technology. This is the first such model for health-tech procurements from provincial institutions to individual entrepreneurs, officials added.

The plan is for the institutions to supply start-ups with financial and research support to fine-tune the new technologies being developed - so that the final product can be ready for the public at a faster pace.

The five Western Canadian health institutions who first signed on to CAN are the Saskatchewan Health Authority (who leads the effort to create the network), Alberta Health Services, the Children’s Hospital Research Institute of Manitoba, the O’Brien Institute for Public Health at the University of Calgary, and Vancouver Coastal Health.

Federal Small Business and Export Promotion Minister Mary Ng said that the industry has long called for a more innovative procurement model that would remove growth barriers for health tech start-ups, and this funding is part of that recognition on Ottawa’s part.

Ng added that the funding will be available to the CAN Network almost immediately after Monday’s announcement, as the money will go to facilitate the four Western Canadian health authorities to assess their needs and find the right SME partners who can provide technological innovations in those areas.

“Until today, there was no CAN Health Network,” she said. “There was no integrated market… This is a real, unique approach to supporting scale-ups by enabling the creation on one here in Canada. It’s foundational because it’s going to enable Canadian companies to be able to grow to sell into Canadian institutions.”

Ng added that - while the funding announcement focuses on these start-up products reaching the domestic market - the ability for home-grown health-tech to find their footing at home through public institutions supporting the fine-tuning of the end products allows these products to also eventually make its greatest impact when they hit the global marketplace.

“I’m looking forward to what we are going to see, which is the growth of Canadian companies so they can grow here domestically and become market-ready and market-scale,” she said. “Because the real opportunity is in the global market. Imagine having Canadian companies scaling here, and your existing customers are some of the larges institutions in the country. It gives you an additional ability to grow into the global marketplace.”

“The integrated market is an innovative approach supporting technology development and business growth,” she said. “Through easy access to a large, consolidated domestic marketplace, companies will scale up and be anchored in Canada, commercializing technologies that can be exported around the world.”

Federal officials also say that the $7 million announced this time is part of a $20-million package Ottawa aims to spend in the next short while to promote procurement and start-up networks. The timing of the future announcement for the additional $13 million has not been released.