Growing Pains: Finding Funding as a Biotechnology Company in Canada

In 2016, the Canadian health and life sciences innovation sector contributed $7.8 billion to Canada’s gross domestic product (GDP). It has been predicted by Canada’s Health and Biosciences Economic Strategy that by 2025, the industry will contribute $17 billion in annual exports based on its historical 4% annual growth rate. However, the current plans for the industry aim to increase the growth rate to 9% by 2025 with a projected $26 billion in annual exports and double the existing biotechnology firms to 1800. While our economy will greatly benefit from the industry’s expansion and the jobs that will become available, considerable obstacles in acquiring funding can heavily hinder this growth trajectory.

In a recent Canada-wide life sciences industry survey, 57% of participating life sciences companies considered access to capital as a crippling problem. Most especially, 58% of these companies consider themselves at the discovery and emerging phases of their development where it is more difficult to receive private-sector funding. When asked what types of funding these companies have made use of, just over half of these companies received government assistance. This would mean that of the health biotechnology businesses, which account for one-third of the total respondents, only 15% of them would have applied for and successfully receive governmental funding. The statistics highlight an underlying problem in which professional medical companies are not able to access fundamental financial programs that can aid them in progressing their companies.

Why aren’t more companies receiving SR&ED?

SR&ED is commonly misunderstood to be a research and development (R&D) based incentive where personnel would typically be working in laboratories; however, this is not necessarily the case. Remember, SR&ED is a tax incentive that rewards any sized businesses for conducting work that aims to remove uncertainty and advance scientific and technological development. This could be found in virtually any biotechnology or pharmaceutical business setting. For example, the optimization of a manufacturing process which could output more product can be considered an SR&ED project although it may not necessarily pertain to discovering the compound itself.

Critical factors that determine the pass or fail of an SR&ED claim is in properly highlighting the uncertainty to be resolved and identifying what components of the project are SR&ED qualified work.

How can FelixSR&ED help your business?

At FelixSR&ED, we recognize that raising capital is important for any phase of a biotechnology company especially in such a competitive stream. Governmental funding is relied upon as the first tier of funding for most companies regardless of what life-cycle stage the company identifies themselves to be in.

Our team consists of talented, SR&ED specialized consultants who have carried out many successful claims – a testament to our technical writing and experience in project development. We accompany you through every step of the process Contact us at This email address is being protected from spambots. You need JavaScript enabled to view it. for a free consultation and to see how your business can qualify for SR&ED.