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Research and development (R&D) is a measure of a country’s economic prosperity. Recently, our readers have expressed interest in the health field. How much R&D is Canada performing in the health field and who is funding this research? A methodology has been devised in order to estimate how much of the gross domestic expenditures on research and development (GERD) are relevant to health R&D. This paper presents details of expenditures on health R&D performance and funding.

Definitions

Research and development (R&D)

R&D is defined as creative work undertaken on a systematic basis in order to increase the stock of scientific and technical knowledge and the use of this knowledge to devise new applications. Expenditures on R&D are an important indicator of the effort devoted to creative activity in science and technology.

Gross Domestic Expenditures on Research and Development (GERD)

GERD represent all R&D performed in a country’s national territory during a given year. The GERD includes R&D performed within a country and funded from abroad but excludes payments sent abroad for R&D performed in other countries.

Methodology

Federal government sector: The health GERD figures include scientific activities aimed at protecting, promoting and restoring human health, broadly interpreted to include health aspects of nutrition and food hygiene. They range from preventative medicine, including all aspects of medical and surgical treatment, both for individuals and groups, and the provision of hospital and home care, to social medicine and paediatric and geriatric research.

Federal government R&D expenditures in the health field from 1989 until 2006^e are derived from the survey of Federal Science Expenditures and Personnel. Data were collected from responses to a question on health as a socio-economic objective for Federal R&D spending. Federal government data are published in catalogue no. 88-204-X.

Provincial governments: R&D expenditures in the health field are based on values from provincial science surveys which identify their intramural R&D expenditures in the health socio-economic objective field.

Business enterprise sector: The pharmaceutical and medicine manufacturing industry North American Industry Classification System (NAICS) 325410 is the most significant source of health R&D in the business enterprise sector. Other NAICS industries which are prevalent in health R&D include: pharmaceuticals and pharmacy supplies wholesale - distributors (414510), testing laboratories (541380), research and development in the physical, engineering and life sciences (541710) and health care and social assistance (NAICS 62) industries. Data originate from the R&D in Canadian industry survey conducted by Statistics Canada.

The higher education sector: Health R&D statistics are derived from Statistics Canada’s revised higher education R&D estimates (catalogue no. 88-001-X vol. 30, no. 5) which identify R&D performed in the health field. The revised estimates are based on the assumption that the total R&D expenditures are equal to the sum of: a) sponsored research expenditures (including all teaching hospitals); b) indirect expenditures on sponsored research; c) a value for the fraction of faculty members’ time assumed to be devoted to sponsored and non-sponsored research; and d) indirect expenditures related to faculty members’ time on research. Statistics Canada uses Canadian Association of University Business Officers (CAUBO) and Centre for Education Statistics data in order to compile the estimates.

Due to the nature of the estimation system for higher education research and development (HERD) statistics, higher education is the only sector of performance where a regional breakdown of health R&D is available.

Private non-profit sector: Values used for estimating health R&D expenditures in the private non-profit (PNP) sector are those identified as health-related in survey responses.