House of Commons Hansard #44 of the 37th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was first.

Topics

*Question No. 73
Routine Proceedings

12:40 p.m.

Sarnia—Lambton
Ontario

Liberal

Roger Gallaway Parliamentary Secretary to the Leader of the Government in the House of Commons

Mr. Speaker, in response to (a), HMCS Victoria visited Port Canaveral, Florida from July 7 to 12, 2003.

In response to (b), the purpose of this visit was to foster international relations and to provide a morale and welfare stop for the crew during her transit to Esquimalt. This visit was planned before her departure from Halifax.

In response to (c), several repairs were completed during the transit. None of the repairs conducted on board HMCS Victoria during her transit were considered mission critical nor would any of the repairs have prevented the submarine from sailing if the repair could not be completed. The following table summarizes the repairs completed during the transit:

Questions Passed as Orders for Returns
Routine Proceedings

12:40 p.m.

Sarnia—Lambton
Ontario

Liberal

Roger Gallaway Parliamentary Secretary to the Leader of the Government in the House of Commons

Mr. Speaker, if Question No. 42 could be made an order for return, this return would be tabled immediately.

Questions Passed as Orders for Returns
Routine Proceedings

12:40 p.m.

The Acting Speaker (Mr. Bélair)

Is it agreed?

Questions Passed as Orders for Returns
Routine Proceedings

12:40 p.m.

Some hon. members

Agreed.

Question No. 42
Routine Proceedings

12:40 p.m.

Canadian Alliance

John Duncan Vancouver Island North, BC

How much money has the government transferred to the Métis Nation of Ontario each fiscal year for the period 1994-2003?

Return tabled.

Question No. 42
Routine Proceedings

12:40 p.m.

Liberal

Roger Gallaway Sarnia—Lambton, ON

Mr. Speaker, I ask that the remaining questions be allowed to stand.

Question No. 42
Routine Proceedings

12:40 p.m.

The Acting Speaker (Mr. Bélair)

Is that agreed?

Question No. 42
Routine Proceedings

12:40 p.m.

Some hon. members

Agreed.

Patent Act
Government Orders

12:40 p.m.

York West
Ontario

Liberal

Judy Sgro for the Minister of Industry and Minister responsible for the Economic Development Agency of Canada for the Regions of Quebec

moved that Bill C-9, an act to amend the Patent Act and the Food and Drugs Act (The Jean Chrétien Pledge to Africa), be read the third time and passed.

Patent Act
Government Orders

12:40 p.m.

Barrie—Simcoe—Bradford
Ontario

Liberal

Aileen Carroll Minister for International Cooperation

Mr. Speaker, it is a pleasure to rise in the House today in support of Bill C-9. This is groundbreaking legislation that clearly demonstrates what can be accomplished when we focus on what truly matters: humanity and compassion.

Today with the Canada and Jean Chrétien pledge to Africa act, we are sending a message to the community of nations. When confronted with misery and tragedy, Canadians do not look away.

We do not close our eyes to the sufferings of others and we do not throw up our hands in despair, we act. Diseases such as HIV-AIDS, tuberculosis and malaria are taking a terrible toll on the developing world. They accounted for almost a quarter of the global death toll last year.

However, numbers alone cannot begin to convey the full impact of these diseases on the political, economic and social structures in developing countries. Eighty percent of those dying from AIDS are between the ages of 20 and 50. It is anticipated that by the end of this decade, there could be more than 44 million AIDS orphans.

As a result, we face a potential demographic crisis where the most productive members of society can no longer raise their families and contribute to their communities.

The world's poorest countries cannot effectively fight poverty if their teachers, students, health care workers and business people are debilitated by disease. Simply put, we face the breakdown of families, community life and ultimately societies at large. Yet many of the diseases plaguing poverty stricken countries are largely treatable.

In the developed world, for example, the use of combination chemotherapy with anti-retroviral agents makes HIV-AIDS a chronic but a manageable disease. In the developing world, however, these drugs are largely unavailable. Only about 5% of those who require anti-retroviral agents are getting them and the same is true for other essential drugs. This is a great injustice and one that must be addressed.

As Canadians, we need to get involved. We need to work hand in hand with other nations to help lift the death sentence that HIV-AIDS and other diseases have literally imposed on millions of men, women and children across the planet. Fortunately, the situation, while dire, is not without hope.

After many years of sounding the alarm, the tireless efforts of a committed few are awaking the rest of the world to this grim reality. As Stephen Lewis, the United Nations Secretary General's Special Envoy on HIV-AIDS in Africa has noted, “there is a new momentum”. We are seeing a renewed commitment and engagement by those in the developed world.

I believe that Bill C-9 is a big step toward strengthening Canada's commitment on this issue.

This legislation responds to a decision by the World Trade Organization to override certain provisions of the agreement on the aspects of intellectual property rights as they relate to trade.

The decision is intended to permit the export, under certain conditions, of licensed versions of patented pharmaceutical products to countries that cannot manufacture their own.

I should point out that the WTO does not require its members to enact any particular measures. No one has ever said that Canada must get involved. Nevertheless, our collective conscience says we must do so. This is a moral imperative and a pressing need to act, and to act quickly.

We sincerely hope that our leadership on this issue will encourage other countries to follow our example.

Bill C-9 is based on a balance of interests. On one side, there are the great humanitarian objectives, to send vital pharmaceuticals to developing countries. On the other side, we must protect the integrity of our intellectual property system and ensure that we respect our international obligations in this matter.

We must not forget the importance of intellectual property rights, such as those protected by patents. After all, such protection stimulates continued progress in medicine, progress for the good of every one of us.

The government is persuaded that this bill reconciles these two imperatives and establishes a practical system to permit appropriate medicines to reach the people who need them.

At the same time, we recognize that access to less expensive generic versions of medications alone is not enough. Without well trained health care workers and adequate infrastructure, developing countries will unable to reverse the spread of these diseases.

That is why in addition to moving forward on Bill C-9, Canada continues to help developing nations build their capacity in their health care systems. By moving on these two fronts at once, increasing access to drugs and strengthening health care systems, Canada is working very hard to enable poor countries to scale up the treatments.

Canada is the first country to adopt this kind of legislation. Other countries are sure to follow our lead.

When I was in Washington last weekend for the spring meetings of the World Bank and the IMF, ministers from other countries commended Canada for the bill. They asked me for details so they could replicate it in their own countries. By having been the first country to come out of the gate and by having been the first country to bring forward this very important legislation, indeed we are imposing a certain onus, and it is an onus I intend to speak of in whatever international venue I find myself.

Because the world is watching, we have to get this right.

Thanks to a wide range of contributors, I believe we have achieved this.

I will take this opportunity to thank the members of the Standing Committee on Industry, Science and Technology and the many people who took the time to send in their comments and to appear before the committee.

The list of such intervenors is quite long and includes representatives of the patent medicine sector, the generic drug sector, and many non-governmental organizations, such as Doctors without Borders and Oxfam.

I applaud the commitment each one of them has made to this humanitarian initiative. Because of their efforts, in large part, the bill has been amended and very much improved.

Let me outline very briefly how the new regime proposed by Bill C-9 will work. The regime proposes a number of schedules that set out the pharmaceutical products and the countries to which the bill applies. Where any such country identifies a need for one of these products in order to respond to a public health problem, the country may approach a Canadian generic drug manufacturer to negotiate a supply agreement. I should add that these schedules are very inclusive and can be speedily amended to add countries or to add pharmaceutical products to respond to changing demands.

A supply agreement can be concluded at any time. The only obligation on the generic drug company is that before applying to the Canadian Intellectual Property Office for an export licence, it must first approach the brand name company holding the patents for that product to see whether the latter is willing to accord a voluntary licence on reasonable terms and conditions. If the brand name company is unwilling to do so, the generic company is free to proceed with its application for a licence and, assuming the requisite health, safety and administrative conditions are met, a licence will be issued and the product can be exported.

Finally, the regime also includes a number of safeguards to ensure the export of high quality products that will be provided directly to the people who need them.

Bill C-9 is good legislation. It proposes a fair and workable regime. This speaks volumes for Canada and Canadians and reflects a compassion that will soon benefit those in need of our help. I encourage the members of this House from all parties to lend their support to Bill C-9. Together, we can send a clear message to the millions of men, women and children in the developing world. It is a message of hope and compassion. It is a message that says Canada cares.

Mr. Speaker, I am noting your body language and I am wondering if I have run out of time. If I have, in that case I will conclude my remarks.

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Government Orders

12:50 p.m.

An hon. member

Ten minutes.

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Government Orders

12:50 p.m.

Liberal

Aileen Carroll Barrie—Simcoe—Bradford, ON

More? In that case, I will add just a few more remarks as I know there are other colleagues who wish to speak. I do not want to in any way preclude that, but I do think it is important, speaking for a moment as one the five ministers on Bill C-9, to reflect a bit of our perspective in the Canadian International Development Agency. We see, as do our other department colleagues, that this is just one part of Canada's contribution to the global effort to combat disease in developing countries.

Canada's efforts also focus on preventing the spread of disease and helping people with disease live fulfilling and productive lives. As I mentioned yesterday in a response to a question here in the House, it is part of the very holistic approach CIDA takes to development because it works.

I used the example of what we are attempting to do in building the capacity of countries in the developing world to provide the kinds of health services so desperately needed, and of course to have the structures and systems in place to dovetail with the present and future availability of less expensive drug products. Indeed, improving access to those medications is essential, but as I say, in order to maximize their benefits, the health systems must be improved and we are actively involved in doing so.

This means, then, ensuring that there are enough doctors, nurses, hospitals and clinics to administer the medicine and to ensure the follow-up, so different from here in Canada. The care prior to the ravages of disease and the post-hospital or post-clinic care are imperative to treating the diseases that we are aiming to treat.

It also means ensuring that there is adequate access to clean water and sanitation, which curtails the spread of the disease. Some 60% of the diseases so rampant in developing countries are caused by a lack of clean water, so CIDA has many programs dedicated to the provision of clean water and to dealing with all the causes of contamination. In that regard, we partner with many very effective NGOs to accomplish that objective.

In addition to all of what we do to build up the health care systems, we of course have committed very serious and large amounts of our budget to address the HIV-AIDS pandemic generally. In the years from 2000 to 2005, our investment is in the area of $270 million. When we add to that an additional $1.2 billion allocated for health and nutrition initiatives, all a part of what we are attempting to achieve, it shows the very serious priority that we assign to health care and to the prevention and treatment of diseases in developing countries.

I have made reference to my efforts as minister for international development in international venues where I find myself. It is a great opportunity, as a member of group of six like-minded donors called the Utstein group, including Sweden, Norway, the Netherlands, England and Canada, that I am able to convey to them what we have done, being the first out of the gate with Bill C-9, and the first one to come into compliance with the TRIPS agreement, which we all signed as members of the WTO. Let me say that quite frankly I put an onus on them. They are very ready to bear that onus and very keen to receive all the details of this legislation, which has been the result of an excellent partnership of five departments of government, stakeholders in the community and in Canada, and a great willingness to come together to make sure that not only will we pass that legislation but that it will be an excellent piece of legislation.

I am delighted that we will have accomplished this today. It is a very exciting day. I think it is a wonderful news story. I hope that the media, who are very quick to note areas that they determine to be newsworthy, will make a major news story out of the passage of Bill C-9 in this House on this date, because it is a day that we all should mark.

Finally, let me say that yesterday I spoke briefly to the bill, along with other colleagues, and I made sure I stayed in the House to listen to the remarks of the hon. member for Calgary East, who spoke of his support for the bill and the work that he too brought to the process. He originally came from Tanzania and I had the opportunity to be in that country with him, long before I was given this position, to meet members of his family and to observe first-hand the experiences he has shared with the House. He has told us of the situation in that country as it faces the ravages of diseases and of the commitment it instilled in him to be a very supportive part of the team that brought this bill forward. I thank him for his remarks. I think Canadians should know that it is the Liberal government bringing in this bill but with tremendous support from all around this House.

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Government Orders

12:55 p.m.

Canadian Alliance

Jim Abbott Kootenay—Columbia, BC

Mr. Speaker, I almost am reticent to bring not a sour note to the debate, as clearly on the substance of the bill itself the member preceding me has spoken very eloquently, and certainly it is reflective of the position of the Conservative Party and I think of all members of this House. We want to proceed with the bill.

I would just point out, though, one of the difficulties that we in the Conservative Party of Canada are experiencing at this point. It is the fact that on this bill, which is probably one of the most worthy bills that has come before the House in recent history, and on other bills that are presently before the House, we are at a third reading point. We are at a point of them being able to pass from this House to the other place, on through that process and to royal assent, and we consistently have the Liberal members filibustering their own bills.

I am not suggesting that this member's speech was a filibuster. It was not. It was a statement of where she is coming from and a very clear, eloquent statement of where her party is coming from, and, as I say, joined by all of us. I was interested, though, that at the end of her 10 minute time when she was informed that she had some more time--you will have to take a look at the blues, Mr. Speaker--I think there was something along the lines of “well, I guess I should keep going”. It was much the same way for the member for Yukon on the previous legislation immediately prior to this debate on this bill, where he was clearly just marking time.

So I would ask this member if she might not feel that it would be appropriate, at this point, subject to what our colleagues from the BQ and the NDP want to do, for her to just terminate the debate on the part of the Liberals so that we can get on with this and get on to other business in this place, rather than them continuing to filibuster their own bills.

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Government Orders

1 p.m.

Liberal

Aileen Carroll Barrie—Simcoe—Bradford, ON

Mr. Speaker, I am sorry if I worded it poorly. I think that is all that can be the cause of this misunderstanding. As the minister for international development, this is a huge day for me and for my colleagues.

Having finished the prepared notes, realizing that I cannot make you out all that clearly without my glasses on, Mr. Speaker, I was therefore not sure how much time I had, which was the reason for my asking. Learning from you that I had a little more time, I have to be honest and say I really did want to continue to exude on the substance of the bill, on the process that brought us the bill. If I have misled the hon. member, I sorely regret doing so.

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Government Orders

1 p.m.

Bloc

Réal Ménard Hochelaga—Maisonneuve, QC

Mr. Speaker, it is a great pleasure for me to take part in this debate on Bill C-9. As I was saying yesterday, I do so with the belief that, to some extent, we are contributing not only to the north-south dialogue, but we are clearly making history, since this bill was passed unanimously and therefore received extremely strong and continuous support from all parties.

As members know, all the parties committed to working together to ensure speedy passage of the bill, in hopes that the other place will do likewise. However, we know this is another matter entirely.

Bill C-9 addresses the important issue of the contribution of companies manufacturing pharmaceutical products. My caucus colleagues know that, for about ten years now, I have taken an interest in the actions of drug companies, both the generic products industry and the innovative drug industry. I am extremely proud to say that I do not think I have ever been too critical, as the member for Verchères—Les-Patriotes knows.

Today, I would be remiss if I did not pay tribute to the innovative drug industry, which has assumed its responsibilities. Let us take a closer look at this issue.

In 1989, the Conservatives, under Brian Mulroney, ended the compulsory licensing program. In other words, it was possible, before Bill C-22, which became Bill C-91 under the Conservatives, to obtain a licence from a company with a monopoly. This licence was granted to a generic drug company, which had to pay royalties to be able to produce and reproduce the drug.

We must not forget that, back then, the term of a patent was ten years. What is a patent? I think that the President of the Privy Council has doubtless thought about this. A patent is important because it is a social contract. The President of the Privy Council will agree with me that it is a social contract by which society gives exclusive right to the protection and production of an invention or pharmaceutical product.

Furthermore, 18 months after the patent is filed, a full description of the invention is made public. There are, however, three criteria that must also be met. There are three criteria for patentability, at least in Canada.

First, the invention must be new. A search is conducted worldwide, not just in North America. The Commissioner of Patents conducts an international search to ensure that it is a new invention.

Second, the invention must show ingenuity.

Third, the invention should be useful.

If these three conditions are met, a patent is granted, and it provides trade exclusivity and complete protection. Copying the invention or chemical process is against the law, and there can be counterfeit charges. This is an extremely strict system.

In matters of copyright, we have case law and judicial mechanisms, since extremely important trade issues underlie the whole concept of copyright.

In 1989, the Conservatives did away with compulsory licensing. From then on, Canada was in line with what was being done in other countries. That was very important for Montreal, since the biotechnology industry is concentrated there. The Conservatives set the patent protection at 20 years, once the patent has been granted by the commissioner and the three conditions—new, useful and not obvious—have been met. Patent protection is then provided.

However, when Bills C-22 and C-91 were enacted, they also had provisions forbidding the export of drugs. It was illegal to export drugs, and sanctions could be imposed.

Since 1989, another factor has been added, and this is intellectual property rights. Governments signed what has been called the TRIPS agreement.

Moreover, two years ago a bill was passed to harmonize all Canadian patents. Some were still in the 10-year system, others 20. There was a challenge by the U.S. under the TRIPS agreement, and the mandatory arbitration went against Canada.

A noteworthy point about the WTO is that the relative clout of the countries has no importance. There are dispute settlement mechanisms in place that allow a country like Costa Rica to win out over the United States. Canada lost and so it has to harmonize all of its patents to the 20-year period.

Today we have a bill before us that will make it possible to export drugs, but not to export them just anywhere, just to designated importing countries listed in the schedule to the bill. Basically, these are the developing countries.

The list was incomplete in the first version of the bill, and the Minister of Industry has revised it. To all intents and purposes, the countries able to import drugs fall into the category classified as developing countries.

How will this be possible? Countries wishing to obtain drugs issue a call for tenders on a web site, so the competition is international, of course. Canadian companies will be competing with others in the U.S. and Europe.

When a company wants to compete in order to supply drugs to a third world country, there are two things in the bill that govern this. First, generic companies will be able to obtain the contract. Initially the bill contained what was termed the right of first refusal. This meant that companies holding a patent could, even if the contract had been negotiated by the generic companies, be the first supplier because they were the patent holders.

All of the international cooperative bodies criticized this bill, from Development and Peace to Doctors without Borders. All those involved in delivering humanitarian aid said that this was impossible, that if this right of first refusal were maintained there would be a dissuasive effect on the generic companies which might want to negotiate contracts.

At least in this one instance, though far from a regular occurrence, the government did heed the stakeholders in committee, and the right of first refusal was done away with.

The supply of drugs is not a trivial issue. Just think that, every year, 10 million children die from diseases relating to malnutrition which could have been avoided. Every year, one million people, most of them children under the age of five, die of malaria. Every day, over 8,000 people in the world die of AIDS. We know that the HIV-AIDS epidemic is concentrated in certain parts of the world, particularly in African countries.

Why are these figures important? Because, for each of the diseases that I mentioned, there is a drug available. However, if this drug is not accessible at a lower cost to countries that are facing these epidemics, we will not be able to fight these epidemics.

Even if Canada, through cooperation agencies such as CIDA, allocated $100 million per year for the development of third world countries, if the nationals of these countries are not themselves active, productive and healthy citizens who can make a commitment to help build and improve their country and their economy, these developing countries have a major problem on their hands.

We need legislation that will allow third world countries to have access to drugs at a lower cost. The way drugs are being produced—and that includes the factory price and the distribution to retailers—it is clear that the system is not competitive.

Of course, in Canada, the Patented Medicine Prices Review Board was established when the Conservatives passed Bill C-91. The board is a quasi-judicial tribunal. Let me give an example. When Merck Frosst produces a drug, the Patented Medicine Prices Review Board monitors the situation to ensure that, once the drug leaves the factory and is distributed to wholesalers and retailers, the price charged is not prohibitive or exorbitant. We have a price index to determine if prices are excessive. If they are, the Patented Medicine Prices Review Board may ask the company to refund the overcharged amount. Such a measure has been taken in a number of cases.

When it comes to exporting drugs from Canada, the Patented Medicine Prices Review Board has no jurisdiction. It was up to the international community to amend agreements on intellectual property rights and trade in order to make these drugs accessible at a better price, a cheaper price. This raised a number of issues.

I think that everyone in this House understands how this works. A voluntary licence is issued by the patent holder. If the latter refuses to issue the licence, the patent commissioner may issue an order. The agreement amended in August 2003 does not require the patent holder to transfer their drug.

A royalty of roughly 2% of the commercial value of the product has to be paid out. This is not a donation. Companies that hold the patents will receive royalties for the person or company that obtained this voluntary licence. If there is disagreement on the royalty or the terms of the licence transfer—which initially has to be voluntary—the patent commissioner can be asked to rule and the licence, which was to be voluntary, will become mandatory.

Concerns were raised during the work at committee on how NGOs fit into this. For example, there is Doctors Without Borders, and Development and Peace, which are Canadian NGOs working in third world countries. Some NGOs, if not all, would have liked to be able to negotiate directly with the manufacturer. Obviously, thought needed to be given to this. There was a risk of interfering in national sovereignty.

Governments are subject to international law. In major international conventions, government means something. One of the first conventions provided a definition of sovereignty. That word simply rolls off my tongue. Sovereignty was defined in 1934 at Montevideo. It was said that a government has five characteristics: a functioning government; a permanent population, of course; control over a territory, which is increasingly being described as a defined territory; the capacity to recognize citizenship; and, of course, international relations.

Once a government or administration is in office, it is responsible for the delivery of health care. I understand the industry minister has amended the bill to ensure not that NGOs can directly negotiate with the manufacturers but that they can be involved in the negotiations since they have the ultimate responsibility for service delivery. That is one of the responsibilities governments have.

Parliamentarians also wanted to ensure that the additional pharmaceuticals needed to supply third world countries are manufactured in a manner that distinguishes them from the products sold on the domestic market. Under the bill, pharmaceuticals for export would be differentiated through different colours and different labels.

This is an extremely humane and responsible piece of legislation. I want to say a few words about the companies grouped under Rx&D. I remember having breakfast at the parliamentary restaurant with representatives of that organization, along with our industry critic, the hon. member for Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, and also, of course, our international trade critic, the hon. member for Verchères—Les-Patriotes. The hon. member for Trois-Rivières, who has a long-standing interest in the third world, also joined us. I even recall that he asked very relevant questions. He was most interested in Africa.

We understand, of course, that pharmaceuticals would not only be exported to Africa. They could also be exported to Central and South America. However, I remember how much emphasis the member for Trois-Rivières put on Africa.

We wanted to ensure that the member companies of Rx&D would co-operate. It is clear that if the companies had not been interested in issuing voluntary licences, we would have found ourselves in a very embarrassing situation. Various arbitration mechanisms would have led to compulsory licensing. The commissioner of patents would have had to intervene and it is clear that it would have caused undue delay.

I must say that the innovative companies have behaved very responsibly in this matter. I hope that this sense of responsibility is reflected in the various domestic debates we shall have.

Perhaps I could take a few moments to talk about what is going on in Canada with respect to the price of pharmaceuticals, even though I know this is about the international level. Members are aware that it is the largest expense in all health care systems. In fact, each year in Canada, a total of $120 billion is spent on health. The fastest growing budgetary item in that area is the cost of drugs; the hon. member Abitibi—Baie-James—Nunavik knows this because he has sat on various regional health boards.

I had proposed a number of solutions to my caucus, in order to fight the rising cost of pharmaceuticals. In fact, the cost of medicine is rising at a faster rate than costs in the health care system in general. On average, health care costs in Canada, in each province, are rising by 5% per year, but the cost of medicine is rising more than that.

I shall conclude by saying that we are going to support the speedy passage of Bill C-9, because it is a good bill for third world countries, for our international obligations, and for the north-south dialogue.

I salute the innovative companies that have shouldered their responsibilities. I congratulate all members of this House—in particular, the hon. member for Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques—who have worked very hard in committee. I hope the other place will enjoy the same kind of energy that has characterized this House's work on Bill C-9.