Study examines contract research as a source of funding

Toronto, ON – A new study on research contracting in Canada has been released by The Impact Group, a science and technology policy consulting company. The study, called Knowledge Transfer Through Research Contracting, highlights the scale and scope of research contracting taking place at Canadian universities and hospitals/health authorities.

The study, which was based on data supplied by a sample of 17 universities and 4 hospitals or health authorities, found that these organizations conducted 2,645 research projects in 2008-09, under contract to outside organizations, with a total value of $257.5 million.

According to the study, contract research is the largest single category of research funding at Canadian universities and hospitals/health authorities – exceeding the annual funding provided by any public sector research granting agency. (Total contracting for all universities and hospitals/health authorities in Canada was $1.154 billion in 2006, $1.274 billion in 2007 and $1.971 billion in 2008 – accounting for between 20-30% of all research funding in those years.)

Sponsored by a group of public sector organizations concerned with research, the study examined the characteristics of contract research performed by universities and hospitals/health authorities – over and above research funded by grants and contributions. Project leader Ron Freedman, a partner in the firm, explained why the study is so pivotal:

“Research contracting is arguably the most important mechanism for research knowledge transfer from higher education institutions, yet it flies under the radar of policymakers,” says Ron Freedman, a partner in the Impact Group. “A great deal of effort is being devoted to supporting the commercialization of technology developed in universities and hospitals. Yet, a more important source of knowledge transfer and economic and social returns is the huge volume of research contracting between universities and hospitals and outside organizations every year. Such contracting revenues easily eclipse the $53 million a year of revenue from traditional technology commercialization activities.”

Key findings include:
– A rough calculation suggests that the $1.154 billion of contract research in 2006 likely employed in excess of 11,000 highly qualified personnel – graduate students, postdoctoral fellows, technicians and technologists, administrative staff, and suppliers. Research contracts also provided overhead funds to the host institutions, helping to defray some of their core operating expenses.

– Research contracts are dominated by projects in the health/life sciences disciplines. Over 40% of 1,888 sample contracts let to universities and hospitals/health authorities were classified either as health (1.6%), life science (24.0%) or medicine (15.9%). The next largest category was engineering (19.1%). social science (12.5%) and humanities (4.2%) projects together accounted for 16.7% of the contracts classified by number.
– Institutions reported that they had signed contracts with organizations in 22 different countries during the study period. Canadian organizations were dominant (83.8% of the total), followed by organizations in the US (12.3%) and Europe (3.1% in total).

– Organizations located in Canada placed contracts with a total value of $174.7 million, followed by organizations in the US ($69.1 million) and Europe ($6.5 million). Canadian sources accounted for 68.6% of the total value of contracts, compared with 27.1% for US sources and a total of 2.6% for European sources.

– The federal government was the largest single research contractor both by number and by dollar value, providing $49.4 million for research. Foreign non-profit organizations ($34.3 million), Canadian companies ($30.3 million) and Canadian non-profit ($28.4 million) organizations, followed by provincial governments ($27.3 million) were the largest research funders overall.

– The four hospitals/health authorities that participated in the survey conducted 782 of 2,645 research projects in the project database – 29.6% of the total – and accounted for $40,534,207 out of $257,492,721 total research funds – 15.7% of the total.

– Canadian companies funded a higher proportion of contracts in Atlantic Canada than in other parts of the country. Canadian companies were responsible for 40.2% of all Atlantic contracts, slightly more than the federal government (37.8%).

“Canadian university and hospital researchers are doing a great job of transferring their knowledge to companies, governments and the non-profit sector through research contracts,” says Mr Freedman. “Initiatives that raise awareness among companies and researchers of each other’s needs and capabilities and support research contracting, will pay big dividends for Canada.”

The full report is available at www.impactg.com.