Ian Curry, CEO of DNA Genotek. (Photo by Darren Brown, OBJ)

Lynn Buchanan has been on the job as the Ottawa Centre for Research and Innovation (OCRI)'s vice-president of their life sciences group for about two months, and the state of Ottawa's biotech sector already has her scratching her head.

She's even wondered aloud whether there's a sufficient "critical mass" of established firms in the area to support the biotech industry. Despite those questions, however, Ms. Buchanan remains upbeat, predicting the sector can be rejuvenated by resolving obstacles preventing startups from thriving or, once on their feet, remaining in Ottawa.

She said her priority is to review the sector and come up with "a strategic direction."

Ms. Buchanan told the OBJ significant discoveries in the university or research lab often fail to make a smooth and profitable transition into the marketplace. "That's at the heart of the problem," she said, adding she's devised a day-long conference in early June to get scientists, business people and end-users talking to each other.

For their part, entrepreneurs and executives in both emerging and well-established Ottawa biotech companies say all the pieces are at hand to kick-start the anemic sector. While challenges exist, including a tight venture capital situation, the gloom and doom are simply not warranted, they say.

DNA Genotek CEO Ian Curry said there's too much emphasis on the sluggish conventional venture capital situation. His firm, which manufactures DNA sample-collecting devices, is angel-funded and has been in production for four years, growing at least 100 per cent per year and now selling product in 85 countries. He called Ottawa "a good place to grow a biotech firm.

"There's lots of opportunity in biotech," he said, labelling it as a growth market fuelled by the public's increasing focus on the environment and health care. "There are a lot of people in Ottawa interested in biotechnology investment, but the question is, can they understand what your business is?

"Ottawa is a high-tech and government town, so you have to encourage people to go into a different industry," Mr. Curry continued. The transition from high tech to biotech is certainly achievable, he added, pointing to DNA Genotek as proof: four of its five executives come from high-tech backgrounds.

After all, there's no shortage of pure scientific talent and research expertise in Ottawa – the region was selected as one of the world's most 'intelligent' communities by New York-based think-tank the Intelligent Community Forum the past three years.

But successful enterprises need the right mixture of science, business and regulatory expertise, according to Ms. Buchanan. The requirements for development, clinical and human trials are essential to accessing Canadian and U.S. markets, and last-minute attempts at regulatory compliance often drive investors away, killing promising innovations.

Biotech firms in a hurry are prone to funding cut-offs and even relocation to the U.S.

What's happening in the Ottawa biotech sector is mirrored at the national level, according to Peter Brenders, president and CEO of BIOTECanada. They're an industry-sponsored association lobbying for sustainable commercial development of biotechnology in Canada.

"We have great technology across this country, and that's recognized south of the border," he said. But Mr. Brenders says poor practices in obtaining startup money have caused many firms to flounder or to be relocated to the U.S. or offshore, especially when companies surrender high levels of control to investors in exchange for funding.

"There's not a lot of venture money in Canada for the life sciences sector, and that affects our business case and requires firms to rely on U.S. funding."

When lenders become impatient, they tell the firm to relocate or lose out on the needed next round of cash.

Those pulled plugs and relocations detract from the "critical mass" Ms. Buchanan hopes to bring to the biotech sector in Ottawa.

For his part, DNA Genotek's Mr. Curry said the city has much to offer from a talent perspective. "There's a lot more talent in the Ottawa area than people understand," he said.

Most of Ottawa's bio-talent lies in the lab, he continued, adding what's missing are the business skills to pitch complicated science to an interested investor.

By Jeff Esau

Special to the OBJ