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A shot in the arm.

It wasn't so long ago that health care companies were few and far between in Manitoba. As recently as 1984, there were only four such companies in the province, with total revenues of $25 million, providing 200 jobs. But times have changed and the expansion of the sector is phenomenal.

Today, health care companies mean big business and more jobs in Manitoba. Manitoba holds Canada's third largest presence, led only by Ontario and Quebec.

In 1997, the Manitoba health care industry brought in revenues of $361 million with a total of 121 companies, according to Steve Daridge, senior manager consulting services Industry Trade and Tourism. These numbers include 20 biopharmaceutical companies, 95 medical device companies and six firms doing research. The companies employed a total of 3,465 people.

These dramatic industry increases accompany an increase in health research at six Manitoba facilities including Health Sciences Centre, St. Boniface Hospital, and the University of Manitoba, according to Daridge.

He stresses that Manitoba has created a climate for these businesses in recent years- with lower taxation overall and research and development tax benefits.

Under the Manitoba Health Research Initiative, in 1997-98, the Manitoba government provided $2 million dollars to the six research facilities to assist in the absorption of overhead costs so that their other monies raised might go directly to pure research. Says Daridge, "Labs cost money to operate. The result of the initiative has been to attract more research dollars into the province."

Because most research and development funding is assigned on a global basis and many dollars go to European centres, Manitoba has to fight for every dollar it gets. "That's why we need to show the dollars go to research," says Daridge.

The provincial government has also done extensive advertising to ensure people in the industry are aware that there is opportunity in Manitoba and that it is a good place to do business. It has placed advertising in international medical journals and its representatives have attended trade shows to establish an overall presence.

According to Marguerite Laramee, coordinator of the Health Care Products Association of Manitoba, there are currently about 130 companies in the sector she represents, including medical device makers and pharmaceutical companies. The nonprofit association to promote the industry, was incorporated in 1990 and is one of four in Western Canada.

Laramee credits the Health Industry Development Initiative (HIDI) for encouraging such large health industry growth.

"The industry is really booming," says Laramee. In fact, in 1997 alone, 317 jobs were created here and an additional 100 -150 new jobs are expected to be created in 1998.

Among the companies benefiting from the Health Industry Development Initiative are Biovale - a pharmaceutical plant in Steinbach - now at full manufacturing capacity with 60 employees. Apotex Fermentation Plant, the Cangene Corporation which manufactures WinRho and exports to the US; National Health Manufacturing Corporation; Novopharm Biotech - doing cancer research in Winnipeg, and Vita Health herbal/nutritional supplement makers which recently merged with a US multinational. All are members of the Manitoba association.


The Cangene Corporation made two million in sales in 1991, with 25 staff, selling 99 per cent of their product within Canada. Last year, they did $18 million and expect to bring in up to $24 million this year, according to Doug Cable, Cangene's manager of corporate development and president of the Health Care Products Association of Manitoba. Cangene now employs about 200 people, deals with 22 countries and expect to expand their business even further in the next few years.

Cangene began in 1984 in Toronto. Rh Pharmaceuticals became Apotex in 1991 and was sold to Cangene in 1995. Apotex marketed generic drugs and WinRho - a blood product originally developed at the University of Manitoba.

Cangene. was the first to license a solvent detergent for plasma products. It was well-received in the US and that fuelled company growth, says Cable. He credits a strong focus on quality and manufacturing for the company's huge success, but also; he says, Manitoba government strategies dating back to the 1980s have also helped.

Those strategies attracted leading edge research facilities to the province and encouraged the development of local companies too.

"The government offered financial aid for companies to start up here, and they also promoted the province as the place for companies to locate" he says. "Ten years ago, there were few pharmaceutical companies in Manitoba, but the medical products industry - including aging, pharmaceutical, health and informatics companies- continues to grow. The domestic market is fairly small, but the need is international and Manitoba companies are diving into the international market."

While ARCOR - a provincial centre for product development, did not succeed as planned, as technology continues to advance, the health care industry is expected to continue to grow.

"We are well-positioned in the province, for a mass of companies to emerge here,' says Cable.

National Healthcare

National Healthcare is an example of strong growth. Three years ago it started making medical device kits for surgery, nursing homes, doctors offices with three people. Today, the company has exploded and employs 100 people in seven divisions and 80 of those employees work at the head office in Winnipeg. Other offices include Toronto and Chicago, according to Nancy Clark, vice president.

National Healthcare expects to do up to $20 million in sales this year, and more than half of it in Canada. That's up from the five million dollars they made in their first year.

"The changes in health care have increased the need for cost-effective products," says Clark. "And there was a need. Before our customers had to look to the international market for supplies. We offer a more cost-effective alternative."

National Healthcare is also currently working on research and development in the area of robotics - to develop new technologies.

Another example of success is Novopharm Biotech, which focuses on gene therapy for the treatment of AIDS and human monoclonal antibodies for cancer therapy, says to Albert Friesen, president. The company has products in each area in phase one testing to prove they are safe for humans, and they are expected to hit stage two testing - to determine appropriate doses for efficacy, by the fall. Phase three is when the drugs are shown to work as a compliment to other treatments.

Novopharm also develops biotech products such as EPO which boosts the number of red blood cells and there is a one billion dollar market for it internationally.

Novopharm was originally set up as a division of Novopharm Toronto in December 1991. It merged with Genesys Pharmaceuticals Inc established 1992 and working on AIDS treatments, in 1997. Today, the company has about 70 employees, with 63 of them working in Winnipeg. Friesen attributes Novapharm's steady growth to Manitoba government support. Friesen has worked in the industry since 1971 and adds that as companies become established in the province with proven track records, more companies will come.

"It shows such work can be done and done here" he says.

Another successful health oriented corporation in the business of injury management is the Occupational Rehabilitation Group of Canada.

In 1990, president and owner Mike Manning, started a disability case management service for other companies on his own. Manning, former director of vocational rehabilitation services for the Manitoba Workers Compensation Board. In 1997, he joined with The Society for Manitobans with Disabilities to provide absenteeism case management services as Occupational Rehabilitation Group of Canada.

The company is based in Winnipeg but also has offices in British Columbia, Saskatchewan and Ontario, with a total of 32 staff including nurses and social workers.

The company earned gross revenues of $100,000 last year. But for 1998 gross revenues are projected at a heft three million dollars.

Says Manning, "we've been lucky, but we've had the right staff."

According to Manning, "We provide a comprehensive, needed service. Manitoba and Saskatchewan are especially good for us, because we really know the legislations and policies."

He says there is return of between $10 and $14 for each dollar invested in case management.

"Disability costs the employer and it causes human suffering too. We deal with both. After six months off, statistically, there is less than a 50 per cent chance of someone returning to work. Everyone pays for that," says Manning.

Manning's clients include some 50 organizations such as the Manitoba Public Insurance Corporation, The Workers Compensation Board, private sector employers.

Among the diverse companies in the health care field is Critical Care International - a medical air transportation service with one jet which started last year. This air ambulance service is a division of the established Keewatin Air - a 14 year-old air transport company.

Owner Bob May started out as a bush pilot with one plane in Northern Manitoba in the early 1970s. When he married a few years later, his wife Judy Sax joined his effort.

The company employs 23 RNs, 20 respiratory therapists and 18 physicians - some of whom are on call at all times, 24 hours per day. They employ an additional 30 others including administration, engineers, pilots, dispatch and senior management. Keewatin owns a hangar in Thompson, a hangar in Rankin Inlet Northwest Territories and lease another in Churchill.

With a fleet of three smaller turbo prop aircraft, Keewatin Air has transported over 5,000 patients in the past 15 years, says marketing manager Randy Klym. In Northern Manitoba and- the Northwest Territories, transportation can be very limited and in health emergencies, air transport is the way to go. "When there is a serious injury or pregnancy issue and the local health unit is not able to tackle it, they call us and we come and take the patient to Rankin Inlet, Churchill or Winnipeg for treatment" says Klym.

Critical Care International's medically-modified jet is most often used to transport Canadians who become seriously injured or ill while staying in the US.

"It is often cheaper for insurance companies to bring them back home and let the Canadian health system take care of them rather than treat them there" says Klym.

If the patient has the proper insurance, it will pay for transport- at a cost of roughly $12,000 to $14,000 or more depending on how specialized the required care might be.

The air ambulance industry is a very competitive one, according to Klym. In Florida alone, there are over 50 air ambulance companies and in Canada, there are 12.

"Our mandate is to be able to be in the air within the hour" says Klym, although he notes that everything depends on the condition of the patient - which is carefully assessed by his crew to ensure the patient is strong enough handle the trip. His crew also works closely with the patient's family during such upsetting moments to ease their fears and uncertainties.

It is obvious how diversified and successful the Manitoba health care service sector has become. By having government and private industry working on the same page, the industry is a textbook example of how high end technology has blossomed into a strong, worldclass, sector.

Liz Bigourdan is a freelance writer based in Winnipeg
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Title Annotation:health care industry in Manitoba
Author:Bigourdan, Liz
Publication:Manitoba Business
Article Type:Industry Overview
Date:Jun 1, 1998
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