The Sun Rises In The East: Nova Scotia Leading Canada’s R&D Sector

As workers from Atlantic Canada have left to pursue jobs elsewhere, and companies from the region have struggled to keep their doors open, Nova Scotia is emerging as a bright light in an area where companies traditionally struggle: commercializing research. California-based biotechnology company BioCycive on Thursday cited the province’s world-class research and development talent, facilities and support as the reason it chose Halifax for its first Canadian R&D headquarters. “As we grow our company, we thought it was a good place to add people,” says Dr. Shalabh Gupta, founder and CEO of BioCycive, which will expand its current location near Dalhousie University. “R&D is affecting, both directly and indirectly, our regional company creations,” says Chris Mathis, president and CEO of Springboard Atlantic Inc., which provides resources to universities and colleges in Atlantic Canada to help them transfer knowledge and technology to the region’s private sector. “In the last three years, our institutions have directly supported the creation of about 28 new companies.” Mr. Mathis says Atlantic Canada must continue to make R&D a focus. “The importance of institutional R&D being commercialized for economic benefit is huge and has never been more important,” he says. “We need high-growth startups and (small and medium-sized businesses) if we are to grow or even to sustain our current lifestyles in the region.” He adds that more commercialization of research in Canada can only happen with increased private investment in entrepreneurs, greater education of its importance, and a higher number of firms to put it at the front end of their business practices. LED Roadway Lighting Ltd., a global player based in the small town of Amherst, N.S., landed a $2.1-million investment by the Atlantic Canada Opportunities Agency (ACOA) seven years ago and a $3-million investment from the same fund two years later, putting it in a position to launch its R&D. Charles Cartmill, founder of the company that designs and manufactures LED street- and area-lighting fixtures and control systems, says the money allowed him to hire PhD-level researchers to design products, which led to contracts with the Town of Amherst and the government of Nova Scotia to replace their street and highway lighting systems. The company considers R&D its competitive advantage, as it constantly adjusts to the ever-changing realities of global competition. The company spends between $2-million and $3-million a year on R&D. “That’s how we keep ahead of the big guys,” Mr. Cartmill says. “We do so much R&D, it’s phenomenal.” The veteran businessman is no stranger to the lighting business. Mr. Cartmill founded a lighting products company in 1974, and the idea for LED Roadway came when he saw the potential of LED and embarked on a $2.9-million R&D program in late 2006 to develop a high efficiency, commercially viable street light. The company provides a variety of LED street-light products that provide strong illumination, save energy and can be placed into a networking system enabling clients to manage lighting and maintenance. The firm’s products can be found around the world in places ranging from the Halifax Stanfield International Airport to the streets of Australia. LED Roadway has averaged a 48-per-cent revenue increase year-over-year for the past three years, and it now boasts 200 employees. “I have taken LED Roadway Lighting from an idea to a globally competitive manufacturer and seller of new technology street lights in just seven years,” Mr. Cartmill says. It has customers in 40 countries around the world. LED Roadway has a 55,000-square-foot manufacturing facility at its home base in Amherst, with research and design work based out of Halifax. The multimillion-dollar business also has production facilities in Britain and Australia, and it has plans to open another operation in Brazil. Mr. Cartmill says the Nova Scotia government helped him validate his technology at home and it made introductions to key business contacts through trade missions. Post-secondary education institutions, he adds, have helped the company find the right R&D resources to remain competitive in the $150-billion global street-lighting industry. While most of its staff is from Atlantic Canada, many of LED Roadway’s new hires come from other parts of the globe. “We try to hire people to be able to grow the business in different countries,” Mr. Cartmill says, adding the company targets new markets with high energy costs that have free trade agreements with Canada. He says his sales and marketing teams work very closely with research and development to craft the right solutions for those markets. Atlantic Canada has suffered from significant economic challenges in recent years, including an out-migration of 11,000 people in 2013 alone, according to Bank of Montreal. “We have been able to repatriate engineers who had moved away,” Mr. Cartmill says. “We have hired graduates and trained them in things like optics, mechanical, and electronic lighting design.” The positions pay well, he adds, and “if you create the jobs, the people will be there.” Mr. Cartmill encourages entrepreneurs to validate and build their ideas at home, and he argues Canadian companies can compete internationally from anywhere. Applied research and development is crucial for firms to be successful, he says. “Commercialization of research is the key.” BioCycive’s Mr. Gupta, a technology commercialization program adviser at Stanford University, says Canada must do whatever it takes to get research from the university to the marketplace as quickly as possible. This involves getting industry, researchers and supporting organizations to collaborate on commercialization. BioCycive is a privately held biopharmaceutical research company dedicated to developing molecules to assist with the treatment of cancer and infectious diseases. The Silicon Valley-based company currently has a cancer drug that is close to clinical trials. BioCycive has already been collaborating with Dalhousie University and it will add to the five people currently on staff in Halifax later this year or early next year, Mr. Gupta says, though he would not disclose the financial investment in the Nova Scotia office or the amount of new jobs the company will provide. The decision to locate R&D facilities in Halifax comes as governments at all levels seek a greater push toward commercialization of research.