Health Committee on Dec. 6th, 2023

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you.

[The Chair, Liberal, Sean Casey]

Thank you, Minister and Mr. Jowhari.

Mrs. Vignola, you have six minutes.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you very much, Mr. Chair.

Mr. Minister, Dr. Lourenco, Ms. Jeffrey, and Dr. Sheppard, thank you for being here.

The $150 million, which was recorded in the losses in the Public Accounts of Canada, is a payment made for the receipt of vaccines ordered by Canada. We agree on that. These are vaccines that would have been approved in the United States and were also approved in Canada. However, the World Health Organization decided not to include them in the possible solutions, because one of the minority shareholders was a tobacco company.

Canada signed on to the Framework Convention on Tobacco Control in 2005. Earlier, you told us that we could not guess what the World Health Organization would do. In fact, it was clear that the WHO would reject the vaccine if there were alternatives. However, if this vaccine had been the only one available, it can be argued that the WHO would have accepted it.

Before the WHO made its decision, did you look into the possibility of Mitsubishi Tanabe Pharma getting rid of the Philip Morris shareholder before the WHO approved the vaccine? Was that one of the requirements you would have asked Medicago for?

[Mark Holland, Liberal, Ajax, ON]

Thank you very much for the question. Allow me to answer in English, because it's easier for me when it comes to technical questions.

First of all, regarding the question of whether or not it was predictable who would reject it, there are two things I would say in response.

Number one, Canada had the sole ability to be able to approve this vaccine. When it was approved in February 2022, that would have allowed for its use in Canada. The decision made by WHO would not have affected that.

Number two, I reject in its entirety the idea that WHO took its position...or that it affected our position. Those are two separate things. With regard to the decision at WHO at that point in time, not only were the other vaccines available, those vaccines were actually for the current variants, as opposed to the ancestral strain. WHO was making its decision at a time when all of the other options were available in the world.

I would posit to you that WHO would have made a very different decision if Medicago had the only viable vaccines. It had to do with the competitiveness of the other options, as opposed to the fact that the minority position existed in Medicago from Philip Morris.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

We agree on that.

In fact, I don't think the WHO even evaluated the vaccine, just the shareholders. At the end of the day, they didn't reject the vaccine; they rejected the shareholders.

Before concluding the agreement, and even before the WHO decided to look into the situation, did the Government of Canada require Medicago to remove Philip Morris International from its shareholders? Has the Government of Canada offered any possible solutions to allow Philip Morris International to withdraw as a shareholder?

[Mark Holland, Liberal, Ajax, ON]

I think there are two important things.

Again, at the time the WHO made its decision, first of all, that was independent of the decision that would happen in Canada. The vaccine that was developed by Medicago, if it were first out of the gate, would have been the one that Canada was using.

Second, with respect to rejecting the shareholders, they were doing that because at that moment in time there was a bevy of other options that were not on the ancestral strain but in fact on the most current strain.

On the last point you made about divestment of Philip Morris, Philip Morris has completely divested itself. It had a minority position in Medicago and it no longer has a position in Medicago, so I suppose it's an academic exercise.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Who owns the intellectual property of Medicago now?

[Mark Holland, Liberal, Ajax, ON]

This is a question that Minister Champagne is looking at and continues to pursue. It's outside of the $150 million that we're talking about today, and it's an important question. He's working on that, and I expect that there will be more information on that in the near future.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Medicago's head office in Sainte‑Foy was bought out by Aramis Biotechnologies. Do you know if that buyout included intellectual property rights, or is that another aspect of the discussion that Mr. Champagne will eventually get back to us on?

[Mark Holland, Liberal, Ajax, ON]

That's more a question for Minister Champagne.

I will say that one of the things that is important to note is that the innovative technology that was developed by Medicago, which is plant-based as opposed to egg-based, has tremendous potential in the future with respect to future vaccine efforts, so its intellectual property is extremely important.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Plant‑based technology is completely new and allows people with egg allergies to be vaccinated, which was previously impossible.

In the negotiations with Medicago, were there any special clauses concerning the termination and protection of intellectual property rights?

[Mark Holland, Liberal, Ajax, ON]

There are certain aspects that I can and can't speak to, because there are confidentiality provisions. I would turn to the officials, because I want to make sure that I'm not answering in a way that would be inappropriate.

[The Chair, Liberal, Sean Casey]

Give a brief response if you can, Ms. Jeffrey.

[Heather Jeffrey, President, Public Health Agency of Canada]

I would say that the provisions of the contracts are subject to non-disclosure and confidentiality arrangements. They were disclosed to the public accounts committee, but in a public forum we can't speak to the other details of the contracts.

[The Chair, Liberal, Sean Casey]

Thank you.

Thank you, Madame Vignola.

Next is Mr. Davies, please, for six minutes.

[Don Davies, NDP, Vancouver Kingsway, BC]

Thank you, Mr. Chair.

Thank you, Minister, for being here.

Minister, was Philip Morris International's 21% ownership in Medicago known by the federal government at the time it signed its advance purchase agreement?

[Mark Holland, Liberal, Ajax, ON]

It was.

[Don Davies, NDP, Vancouver Kingsway, BC]

Was the fact that Medicago was headed by the tobacco giant's former vice-president of regulatory and scientific affairs known to the government at the time it signed its advance purchase agreement?

[Mark Holland, Liberal, Ajax, ON]

Yes, it was known.

[Don Davies, NDP, Vancouver Kingsway, BC]

Thank you.

The WHO has confirmed that it disapproves of tobacco industry involvement in drug companies and believes, “There is a fundamental and irreconcilable conflict between the tobacco industry's interests and public health policy interests.”

Do you agree with that view?

[Mark Holland, Liberal, Ajax, ON]

I do.

[Don Davies, NDP, Vancouver Kingsway, BC]

We've already talked about the WHO Framework Convention on Tobacco Control. Guidelines on implementing that treaty state that governments should not “accept, support or endorse partnerships...with the tobacco industry or any entity or person working to further its interests.”

Given that Philip Morris International owned 21% of Medicago shares at the time the Government of Canada signed its advance purchase agreement with the company, can you explain why the government didn't believe that this entity was working to further the interests of the tobacco industry?

[Mark Holland, Liberal, Ajax, ON]

I completely agree with everything you said around the need to not advance the interests of nicotine and tobacco.

That wasn't what was at stake here. What was at stake here was a Canadian-based company that had an innovative solution. Yes, there was a minority position held by Philip Morris, but the interests of being able to produce a vaccine for Canada and the innovative nature of this technology meant that the minority position, which did not advance the interests of tobacco or nicotine, weighed on the decision by the expert panel that this was an important option to pursue.

[Don Davies, NDP, Vancouver Kingsway, BC]

At the time the government signed its advance purchase agreement, did it give any consideration to the fact that the WHO may end up rejecting Medicago's vaccine because of its ties to the tobacco industry?

[Mark Holland, Liberal, Ajax, ON]

Again, there are two important points here.

First is that, in a Canadian context, the decision by the WHO would not affect our ability to distribute and approve the vaccine. In fact, the vaccine was approved for use in Canada in February 2022. That's point one.

For point two, I very much feel that if Medicago had been the only viable option in front of it, the WHO would have made a different decision. The decision the WHO made at that point in time was based on a moment in time when not only was it not on the ancestral strain but it was on the evolved strain of the coronavirus, and a bevy—a wide range—of vaccines were available.