Ontario gives pharmaceutical companies $150 million for jobs, research

Ontario must invest taxpayer dollars in the research and development efforts of big drug companies if it hopes to keep good-paying jobs in the province, Research and Innovation Minister John Wilkinson said Wednesday as he announced a $150-million fund for pharmaceutical firms.

The New Democrats criticized the Liberal government for giving $150 million to one of the most profitable industries in the world, but Wilkinson said Ontario wants to make sure research that leads to a new drug also results in new manufacturing jobs for the province.

"There's a race for global jobs, and our intention is to make sure that we win that race," Wilkinson said after announcing the fund at a Toronto research centre.

"It's very important for us that we partner with industry to make sure that global mandate is secured right here in Ontario, whether it's making cars or it's investments in the bio-pharmaceutical industry."

The fund for pharmaceutical companies is modelled after the province's auto sector fund, a $500-million program that the Liberals say leveraged $7 billion in new investments in Ontario by the big automakers.

"With this fund, we're taking the next step in saying we want R and D, but we also want the manufacturing here in this province," said Economic Development Minister Sandra Pupatello.
"We know that this level of incentive is what our local CEOs tell us can help drag that world mandate right here into this province."

Pharmaceutical firms will be able to use the fund to apply for grants, loans, forgivable-interest loans and funds for building infrastructure, research and training.

NDP critic France Gelinas said there's no need to give taxpayer dollars to profitable drug companies, especially when the industry in question spends more on advertising drugs than it does on research and development.

"When you look at the ratio of what they spend on developing and manufacturing versus how much they spend in promoting their products, a lot could be done with money they already have."

"I have a really hard time seeing why our tax dollars should go to help those big corporations. It looks like blackmail."

Progressive Conservative Party Leader John Tory called the $150-million fund another example of the Liberal government's flawed approach to the economy.
"I think if we can get guarantees of jobs - jobs that will remain in Ontario and won't disappear - I don't object to at least having in the toolbox of a government direct investment or loans," said Tory.

"But in this case it's an inconsistent strategy with no strings attached, and that's just not right."
Industry representatives said the fund would help Canadian operations convince their global headquarters to invest more in Ontario.

"This partnership with the Ontario government will help strengthen our case by demonstrating that industry and government are committed to the common goal of innovation in this province," said David Ricks, president of Eli Lilly Canada.

"The potential benefits to the economy are real and tangible: more jobs, more research dollars, more investment in spending."

Dr. Janet Rossant, head of research at Toronto's Sick Children's Hospital, said the provincial fund would help Ontario become a major player in the fast growing bio-pharmaceutical industry by encouraging companies to manufacture their new discoveries in the province.

"Very often those investments that begin in Ontario don't stay in Ontario, and we do not develop the full value of those investments in terms of jobs and the economy," said Rossant.
"The kind of incentives that we've heard about today is going to play an important role in attracting and retaining the investment in the bio-pharmaceutical industry in Ontario."

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