By Eric Gombrich
Canada is an incredible country. We maintain one of the most sought-after standards of living, and an exceptional quality of life. We even have a pretty good healthcare system, regardless of the various rankings based on narrowly-defined criteria.
We also have one of the most active and prolific scientific environments in the world, supported by world-class institutions, researchers, academics, and funding (both government and private). We have numerous examples of our innovation prowess, including some of the world’s leading oil & gas exploration technology, mining solutions, Research in Motion (Blackberry), and even the islet-transplant procedure developed for diabetics in Edmonton, to name but a few. On the surface, Canada is a nirvana for innovation. But if your area of focus is healthcare, go a bit deeper and that nirvana quickly disappears.
Most formal definitions of innovation extend beyond simply ‘invention’ and ‘development,’ and extend into commercialization. It makes some sense, after all; an invention no one will pay for is, well, by definition, worthless. And this is where our healthcare systems trip-up the brilliant engineer or entrepreneur from being successful.
First, you’ll note I mention healthcare systems – plural. That’s because we actually have 13 healthcare systems individually controlled provincially, in the territories, and at the federal level such as First Nations healthcare. In essence from an innovator’s perspective, each of these is itself a micro-market into which goods and services are sold. But because each market has its own objectives, priorities, budgets, etc. they might as well be independent countries from an innovation perspective. This often times results in goods and services being developed locally in a province or territory, with limited capacity to export to even adjacent provinces, let alone nationally or internationally, without significant capital and development investment.
Secondly, because healthcare is government controlled and thus wrapped in the political ebbs & flows, to mitigate risk and provide ‘fairness’ any purchase has to go thru a laborious, expensive, and time-consuming ‘procurement.’ Known as the “Request for Proposal” (RFP), these can take upwards of 12-18 months to pursue before any ‘transaction’ can take place. Because of the requisite investment the buyer must make – both in terms of cash and political capital – to even go through this process, they are often times unwilling to procure (aka, buy) unproven solutions, and this steers them away from innovative and novel solutions. This often appears as mandatory RFP requirements for ‘references.’ This is almost a declarative position against innovation.
Thirdly, as an extension of the procurement and budgeting challenges, often times a solution may not exist in healthcare not because it doesn’t exist, but because provider organizations (e.g., hospitals) can’t buy them due to capital constraints or procurement and implementation priorities.
The result is often a local inventor or engineer will build the required solution for them based on specific ‘local’ requirements, at a lower cost, often times naively thinking they have discovered some new solution with broad-scale appeal. The reality, however, is that they’ve not invented something new, they simply sold it at a lower cost to a budget-constrained or RFP-shy customer.
Combine these realities with a capital-constrained entrepreneur or innovator and how does Canada foster an environment of innovation in healthcare, when I could put forth an equal level of effort in the US or overseas, and with success, instantly be able to expand my sales efforts to markets 10-times the size of Canada, let alone any individual province or territory? Sure, doing the engineering and development work in Canada might be appealing, but the commercialization component?
While I love living in Canada and am humbled by the intelligence and scientific work here, I’m inclined to look elsewhere as a focus for the commercialization aspects of my innovation strategy. And to add insult to injury, doesn’t this mean our Canadian healthcare systems may invariably be following, rather than leading the world in terms of health & wellness?
What do you think?