Health Committee on Feb. 12th, 2008

[The Chair, Conservative, Joy Smith]

Good morning, ladies and gentlemen. Welcome to the health committee.

We're very pleased to have some very important witnesses who are going to present before the committee today, as well as the minister, who will be joining us a little later.

Before we go right into the testimony of the witnesses, though, I have a question for the committee—and I would ask the witnesses, if you don't mind, to indulge us for a few minutes and to be a little patient.

First of all, I would like to ask the members if they have any objections to cancelling our meeting scheduled for February 26. That is the date the budget will be coming down. This is due, of course, to the presentation of the budget in the House that day. So what we'll do is take the whole agenda and bump it up so that it goes in the right sequence according to what we had originally planned.

Are there any questions?

Dr. Bennett.

[Carolyn Bennett, Liberal, St. Paul's, ON]

Why would we do that? Isn't our meeting from eleven to one?

[The Chair, Conservative, Joy Smith]

We've been advised that they need this room for the budget. We looked around for other rooms, Dr. Bennett, and there just isn't anything available that day. I also understand that, traditionally on budget day, this is common practice because of the unavailability of rooms. But thank you for that question.

Does anybody else have a question?

Are you all in agreement, then, that the February meeting will be cancelled in lieu of budget day?

Thank you.

Going on, the last item of business I want to bring before you is that there will be a very short pause—and I should tell this to the witnesses too—before the minister comes to the table at 12:15. That will allow the minister to assume his place at the witness table and it will give the witnesses a chance to remove themselves, if they don't mind. The witnesses are welcome to stay, it's just that the minister and his people will be here. That's just to let you know. I'll give you the cue when that happens.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on Tuesday, January 20, 2008, I would like to welcome the witnesses who are with us today on the subject of the supply of radioisotopes.

We have with us Grant Malkoske, who is the vice-president of strategic technologies, and David McInnes, who is the vice-president of international relations, both of whom are from MDS Nordion; and Douglas Abrams, who is the president of the Canadian Society of Nuclear Medicine.

I would like to remind witnesses that you have ten minutes per organization to make your presentations, and after the presentations we will proceed to questions.

I welcome you today. We're quite anxiously looking forward to hearing what you have to say.

Let us begin with the witnesses from MDS Nordion.

[Grant Malkoske, Vice-President, Strategic Technologies, MDS Nordion]

Good morning, Madam Chair and members.

My name is Grant Malkoske. I am vice-president of strategic technologies at MDS Nordion. Accompanying me is David McInnes, vice-president of international relations.

MDS Nordion is an Ottawa-based life sciences company with more than 700 employees at locations in Laval, Vancouver, and Belgium.

We welcome the opportunity to appear before you today to provide our perspective on the 2007 medical isotope supply shortage caused by the NRU reactor shutdown. This event had a significant impact on medical isotope production and our ability to supply medical isotopes to the nuclear medicine community and, in turn, that community’s ability to supply to hospitals, physicians, and patients.

As you may be aware, we appeared before the Standing Committee on Natural Resources last week. As we stated there, there is a sequence of steps in the medical isotope supply chain that ends with hospitals. The steps involve a reactor, a processor, a radiopharmaceutical manufacturer, and a hospital and/or radiopharmacy that administer the product to the patients.

The AECL NRU reactor is our primary source of medical isotopes. MDS Nordion is the processor of these medical isotopes at our facility in Ottawa. It is important to note that MDS Nordion is not the direct supplier of radiopharmaceuticals to hospitals. We distribute medical isotopes, which are active pharmaceutical ingredients, to our customers--radiopharmaceutical companies, all of which are based outside Canada. Our customers, in turn, manufacture radiopharmaceuticals and distribute them to hospitals and radiopharmacies in Canada and worldwide.

Two American companies are our primary customers and supply all of Canada’s radiopharmaceutical products. Canadian-produced medical isotopes are responsible for supplying a total of more than 50% of the world’s medical isotopes, some 60,000 procedures a day, 5,000 in Canada alone.

One important aspect in this supply picture is the global production capacity. The NRU reactor is the most reliable reactor in the world for medical isotope production. Its supply reliability exceeds 97%. There are only three other sources to call upon for backup supply: South Africa, Belgium, and the Netherlands.

If one of these reactors goes off-line, NRU can quickly ramp up to meet 100% of the additional demand. However, the reverse is not true, as we saw last November and December. If NRU is off-line for more than seven days, no other foreign reactor or combination of foreign reactors today can fully fill the supply gap left by NRU. Even with the world’s other reactors ramping up to capacity, there was still approximately a 35% total global shortage in medical isotopes. That gap would have persisted had the NRU reactor remained off-line.

On the evening of November 21 we were informed that NRU would not be restarting after its scheduled shutdown. We immediately initiated our contingency protocol for such emergencies. With only two days of inventory remaining, we began notifying affected customers, radiopharmaceutical manufacturers. We remained in close contact with them over the course of the outage period.

On the morning of November 22, in a meeting with AECL, we were informed of the potential extent of the NRU outage. We advised AECL this outage would cause a shortage of global supply of approximately 30%.

In the afternoon of November 22 we attended a regularly scheduled meeting arranged by AECL with Natural Resources Canada and ourselves. At that meeting we reiterated the estimated impact of this outage on global supply.

On November 23 we contacted our other suppliers in South Africa, Belgium, and the Netherlands in an attempt to source backup supply. Virtually every day we remained in contact with these suppliers.

It is important to note that at this point it was not clear when the NRU reactor would resume isotope production. The information provided by AECL was in constant flux with regard to resolution options and restart schedules. By late November, AECL advised us that it was working toward an early December restart. Based on that information, we then issued a press release.

Starting on December 5, government officials from several departments sought regular briefings from us to update them. That led to later discussions by department officials with Natural Resources Canada and Health Canada to involve us in the development of a communication protocol, should any such supply event occur again.

In addition to repeatedly requesting additional medical isotopes from our backup suppliers, we took a number of steps to facilitate extra supply. We obtained U.S. Food and Drug Administration approval to combine any available backup supply in any proportion. We contacted the Belgian nuclear regulator to validate the shortage crisis and enable special dispensation for increasing processing limits at the Belgian processing facility. We shipped licensed containers to all our suppliers to facilitate immediate shipments should any material become available.

In addition to seeking the backup supply I mentioned earlier, on December 3 we also initiated a meeting with all the world's suppliers to make an unprecedented request that they share their regular supplies. They refused.

Despite persistent attempts to source backup supply, we were only able to get a marginal amount of isotopes from abroad, about 20% of what we needed. All backup supply received by MDS Nordion prior to the time Bill C-38 was passed on December 12 came from South Africa. We were not able to get any backup supply from Europe.

Although the medical isotope shortage turned out to be about 35%, the shortage varied from country to country. In Canada's case, it was about 65% because the NRU reactor is a primary source in our supply chain. As we have learned from the nuclear medicine community, the shortage was more acute in certain regions of the country. The reason for the geographic variation depended upon where each hospital obtained its finished radiopharmaceuticals. Our customer, U.S.-based Bristol-Myers Squibb Medical Imaging, was and still is the largest supplier of finished radiopharmaceuticals to Canada.

We prevailed upon Bristol-Myers Squibb to ensure that Canada received its fair share of available finished radiopharmaceuticals. They informed us that in fact Canada did receive its fair share of the limited supply of medical isotopes then available over the course of the NRU outage period.

In summary, Madam Chair, we believe we acted swiftly and worked diligently to address the medical isotope supply shortage caused by this outage. However, the reality is that there is no source of backup supply that can fulfill the worldwide gap that NRU creates as a result of an extended shutdown. Clearly, it is imperative that government, industry, and the nuclear medicine community collectively find a long-term solution for the reliable supply of isotopes from Canada.

Thank you.

We're available for your questions.

[The Chair, Conservative, Joy Smith]

Thank you, Mr. Malkoske.

Before we entertain questions we will hear from the president of the Canadian Society of Nuclear Medicine, Mr. Douglas Abrams. Thank you.

[Douglas Abrams, President, Canadian Society of Nuclear Medicine]

Thank you, Madam Chair and committee members, for allowing me the opportunity to appear before you today.

I am a pharmacist specializing in nuclear medicine and radiopharmaceuticals and I am the director of the Edmonton Radiopharmaceutical Centre at the Cross Cancer Institute. I'm currently president of the CSNM and I am also a member of the ad hoc committee that was brought together to advise on the isotope shortage.

I would like to provide some very brief background on nuclear medicine and radiopharmacy. I won't go into as much detail as Mr. Malkoske did, so you won't be bored twice in a row.

Nuclear medicine uses many different isotopes for the diagnosis and treatment of a wide variety of diseases. The majority of the diagnostic tests are for heart disease and cancer, although many other disease states are impacted by a shortage. The majority of therapeutic applications are for thyroid-related diseases, but a growing number of therapies are in development and showing much promise.

However, although the number varies with different sources, about 80% to 85% of diagnostic procedures in nuclear medicine use technetium-99m radiopharmaceuticals. This is a short-lived isotope that is conveniently derived from a much longer-lived isotope called molybdenum-99. The isotope shortage reflected the decreased supply of molybdenum-99 when the NRU reactor shutdown was extended beyond the original planned date.

As technetium-99m has only a half-life of six hours and most radiopharmaceuticals have only a 12-hour shelf life, these products are prepared on a daily basis and cannot be stockpiled. This shortcoming is offset by the use of a generator system in which the longer-lived molybdenum-99, which has a 66-hour half-life, or about three days, can be used as the supply for the technetium-99m. These generator systems can be used for up to two weeks.

Alberta was relatively unscathed by this crisis, as the three major centres in Edmonton, Red Deer, and Calgary all get their technetium-99m generators from Covidien, which sources most of its isotopes from Holland. However, as noted previously, the impact was very patchy and many small clinics within Alberta were using generators from BMS, which relies on the NRU reactor supply.

My involvement was to facilitate supply to as many smaller centres as possible, which we did through discussions with Health Canada. Our major efforts were to extend the lifetime of generators after their normal expiry date, facilitate transport of used generators to smaller centres, and look into the use of alternate isotopes.

I think I'll end there. I won't go into too much detail because I suspect I'll get questions asking me for more detail.

[The Chair, Conservative, Joy Smith]

Thank you very much, Mr. Adams.

We will proceed with the questions now, starting with Ms. Fry.

[Hedy Fry, Liberal, Vancouver Centre, BC]

Thank you very much, Madam Chair.

I want to thank both MDS Nordion and the president of the nuclear medicine society for coming today, because this is a very important issue. In the words of the society, it in fact had all the makings of a national medical crisis across this country.

Now, I heard from MDS Nordion that they were aware of the problem on November 22 and that they met with Natural Resources Canada on this issue on November 22. You physicians who were going to need this were not aware until November 27, five days later. Then Dr. O'Brien said in his communiqué that he did not actually talk to anybody at all from Health Canada until probably December 5. So there was a lag time of 13 days before there was any way of talking with anybody in Health Canada to say: What is it we need to do? How can we work on this together?

How did you know on November 22 that this was coming down? Had the nuclear medicine society been consulted? This was obviously going to impact on the nuclear medical society and the patients who see nuclear medicine physicians. Had you been aware on November 22, do you believe there were steps you could have taken, as physicians across the country, to deal with this issue in a way in which you could have triaged patients based on need and so on? Do you think you could have dealt with it over a period of maybe about a month? On the steps that were eventually taken--it was crisis management more than anything else, the shutting down of the reactor and the reopening of the reactor--do you believe your patients could have been served for about a month if you had been consulted early? Do you believe the steps that were eventually taken by the government could have been, in fact, mitigated because you would have been able to deal with it?

Those are the questions I really want to ask you. Were there alternative routes that could have been taken to deal with this thing before it became a crisis and before shutting down and starting up had occurred?

[Douglas Abrams]

Thank you. That was a long question.

The essential problem with the radiopharmaceutical supply is that it cannot be stockpiled, so it is very important for us to learn as early as possible if there is a problem. Then we can start to triage the isotope supply and the patients.

There is very little we can do to mitigate the effect as time goes on, if the supply is not reinstated, so we can make arrangements for the patients who really need the care to maybe go into other diagnostic modalities, if that's possible. That, of course, is not always possible, depending on the waiting list for the other modalities.

As the isotope supply diminishes there is nothing you can do to bring it back.

[Hedy Fry, Liberal, Vancouver Centre, BC]

How long do you think you could have lasted with some sort of interim plan that need not have gone to the kind of crisis management that eventually occurred? How long do you think you could have lasted as a medical community, with your patients, by triage?

[Douglas Abrams]

That answer is complicated, in that it depends upon where you were in Canada. As I stated, in Alberta in particular, the three major centres were supplied by Covidien and we were in fairly good shape. The Edmonton Radiopharmaceutical Centre obtains about 80% of its technetium from Covidien and about 20% from BMS. That 20% from BMS was off and on because BMS made a commitment that centres like our own, which would be able to most efficiently distribute the supply as need dictated, would get the supplies. So we were serviced fairly well by BMS, but not completely.

What we did was to be in contact with a fair number of small communities outside Edmonton—Grand Prairie, Grande Cache, Medicine Hat, Lethbridge, and some nuclear medicine private clinics that did not have supply—and we were able to apportion our supply to help them out. Given the half-life and the transportation logistics, it was not possible for us to go outside of Alberta. Also, we did not have the supply to go outside of Alberta.

[Hedy Fry, Liberal, Vancouver Centre, BC]

So you could have done some things, if you had been informed early enough, to mitigate for a short period of time. How short?

[Douglas Abrams]

What we implemented required a short amount of time for us to work with Health Canada to put in place policies that would allow us to transport generators that had been used in one facility. Then if they were small enough we could ship them out to other facilities. This worked very well for a number of outlying facilities, especially farther north and farther south from us.

The other thing was to use generators somewhat beyond their normal expiry date, implementing the appropriate safeguards for testing to make sure things had not gone awry after the expiry date.

Those were the two things we needed to do. Health Canada responded fairly well with us by giving us process, and we made a process to allow us to do that. We needed the time to do that, but once that was in place, we were set. There wasn't much else we could do.

The other thing we did look at, which might have helped with advance notice, was that some areas that did have cyclotrons could use fluorine 18 fluoride as a bone imaging agent, and this would help offset one of the technetium radiopharmaceuticals for bone scanning. We did not have an approved radiopharmaceutical for that in Edmonton, and in cooperation with Dr. Gulenchyn in Hamilton, we put forward a very hasty clinical trial application to use fluoride, but we never did use that. As things unfolded, we didn't need to.

[Hedy Fry, Liberal, Vancouver Centre, BC]

May I ask one last question?

What will you advise should happen if this ever occurs again? What would be your advice?

[Douglas Abrams]

What we will be looking at in our document, as it comes through, is communication. I think that is key. We need to have communication as quickly as possible.

The other thing we are going to need to look at is how quickly we can mobilize alternative methodology to treat the patients.

[The Chair, Conservative, Joy Smith]

Thank you, Mr. Abrams, for your insightful answers.

Madame Gagnon.

[Christiane Gagnon, Bloc, Québec, QC]

Thank you for being with us here today. I have some questions for Mr. Grant Malkoske.

We were shocked by the lack of an emergency plan for isotope supply, and also by the lack of leadership shown by the government in the field of isotope production and supply. This is a serious responsibility.

You told us that you asked the European suppliers to share their supplies and that they refused. I am rather surprised, because we have heard other hints that your company has trouble revealing its schedule for the production and supply of isotopes.

How do you feel about that? Other people involved have written that you have a problem giving the Europeans an exact production schedule. We must not forget that this crisis was foreseen. It was a known fact that the Chalk River plant was not operating as it should have.

Are you contradicting the impression you are giving?

[Grant Malkoske]

Thank you for the question.

I think the important thing to reflect upon is the world-wide production capability. The fact is that if NRU goes down from a precipitous event, such as took place, there is insufficient capacity around the world to respond and replace the NRU. Frankly, there is no amount of planning in advance that would compensate for that type of an event.

In the normal supply period when the reactors are operating without such a precipitous event, there are scheduled reactor outages around the world. Those by the Europeans are planned well in advance. In fact, through normal production, there is no conflict with regard to the availability of isotopes and the supply of medical isotopes.

Furthermore, we do have backup supply agreements in place with some of our suppliers to make sure isotopes are available through normal outages, which would not be so eventful as one with the NRU. We have plans in place to receive material from the Europeans and South Africans.

So in this type of an event, we do not think that planning is an issue.

[Christiane Gagnon, Bloc, Québec, QC]

Yes, but then why do you say that the European suppliers have refused to or were unable to provide us with the required isotopes?

Now, other sources indicate that they were indeed ready to deliver a certain quantity of isotopes. But you say that they refused outright.

Who is right? Who is wrong? We are hearing two different stories at the same time, one of which is from a journalist who did his own investigation.

[Grant Malkoske]

Please let me try to clarify that.

When the NRU event took place, we immediately started—on November 23, as I reported a moment ago—to contact our suppliers in Europe and South Africa. What we were looking for was an incremental amount of material, whatever they would have available, frankly, to fill the NRU gaps. They did increase some of their production capability. The best information we have is that they increased it by about 10% or 15%.

We then also took a second step. We asked them if they would be prepared to look at the redistribution of the product they had in their normal production capacity, in their normal or routine capability. This is where they declined. So they had a baseload, if you will, and they were not prepared to share the baseload.

Of the incremental 10% or 15% available from the world-wide production chain—still causing a shortfall of 35% globally—we at Nordion were only able to obtain about 20%. So of the increase of 10% to 15%, we got about 20% and distributed it as equitably as we could to our customers, the manufacturers.

So I think there's a bit of difference between routine capability and incremental ramp-up capability to deal with shortages.

[Christiane Gagnon, Bloc, Québec, QC]

Please answer my question. I know that you have financial interests as the sole supplier; if that played a part in your method of obtaining isotopes elsewhere, from the European suppliers, for example, what financial implications would that have had for your business?

[Grant Malkoske]

Really, from our point of view, price was not a factor. As I mentioned earlier, we do have backup agreements in place with the Europeans and South Africans, and those agreements have set pricing in place.

We feel very strongly that we have an obligation to the health care system, and what we did was to proceed immediately to fulfill that obligation. So we contacted our suppliers, we contacted our customers, and we let everybody know that we needed as much medical isotope as they could supply us with to fill the gap. They stepped forward with what they could, but it was really insufficient.

Our business is to provide reliable suppl. It wasn't a price or business issue here.

[Christiane Gagnon, Bloc, Québec, QC]

Yes, but out of $300 million in profit, if we can call it that, $30 million goes to AECL, and that is what your business depends on. You can correct me about the exact numbers, but a large amount of money is at stake. You can tell me that it has no bearing on the matter, but I have trouble believing that.

[Grant Malkoske]

I'm not sure what the question really is.

[Christiane Gagnon, Bloc, Québec, QC]

Since you are the sole supplier of isotopes in Canada, therefore, you are the only one to make a profit. You say that was not a factor. In fact, AECL has very few financial investments; MDS Nordion is the main profit-maker. You say that was not a factor in your decision to seek other suppliers. At that moment, you had a shortfall in income, did you not?