Bill C-393 (Historical)

An Act to amend the Patent Act (drugs for international humanitarian purposes) and to make a consequential amendment to another Act

This enactment amends the Patent Act and the Food and Drugs Act to make it easier to manufacture and export pharmaceutical products to address public health problems afflicting many developing and least-developed countries, especially those resulting from HIV/AIDS, tuberculosis, malaria and other epidemics.

[Robert Bouchard, Bloc, Chicoutimi—Le Fjord, QC]

Correct me if I'm wrong, but you said earlier that we should forget about Bill C-393, CAMR, because it doesn't work. We should, instead, direct our energies toward other kinds of reforms.

What do you suggest Canada do to help the cause?

[Dr. Frederick Abbott]

Thank you very much, Mr. Masse.

It is pretty clear, as a matter of the TRIPS agreement and the August 30 decision, that it is perfectly permissible for Canada to adopt a single-licence solution in which a substantial quantity of drugs is provided over a period of time. There is no requirement in the August 30 decision that the sequencing involved in the Canadian legislation be followed. Provided that notifications are provided at the time the drugs are shipped, Canada will have met all of its international obligations.

Let me add another point. There is no country in the world that is going to initiate a dispute settlement action at the WTO against Canada for providing low-cost drugs to poor people in developing countries. I repeat, no country in the world is going to bring a dispute settlement action against Canada for providing low-cost HIV antiretroviral medicines to people in developing countries at low prices.

Even assuming there were a morally and ethically challenged country that would do that, the worst-case scenario for Canada would be that after a period of three to five years it would have to fix what might be considered wrong with its legislation, and Bill C-393 is not inaccurate.

I want to make one other point. This argument by Mr. Attaran I find absolutely astonishing—and that Canadian parliamentarians are actually caring to echo it. His argument basically is that Canadian pharmaceutical producers are incompetent and cannot compete on global markets. And because they are incompetent and cannot compete on global markets, we should not let them compete on global markets. It's as if to say that because Canadians are not very good at playing basketball we should prevent Canadians from playing basketball and from joining any league that plays basketball.

Apotex supplies a large quantity of drugs to the highly competitive U.S. market. Teva Novopharm is one of the most competitive and largest suppliers of generic drugs in the world. The idea that Canadian industry is unable to compete with Indian industry—and I represent the Indian industry—I find absolutely an astonishing argument for preventing them from attempting to compete.

What are we talking about? We're talking about changing a few words on a piece of paper in Canada: we let you compete. The argument from Mr. Attaran is that we shouldn't change the piece of paper; because they are providing higher-priced medicines, we should foreclose them from competing. I really just find this argument so nonsensical it's hard for me to believe that a group of parliamentarians is sitting in a room accepting it.

I apologize for going on like that, but it's just such a nonsensical argument.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr.Chair.

Mr. Attaran, you've actually convinced me, as someone who has sat through this entirely over the last number of years, even when this was Bill C-56, to continue my efforts even more than ever before. Even looking at the face of your argument, you're actually advocating for generic rip-off drugs to get to people, as opposed to Canadian drugs. That's what would happen and would continue to happen under your scenario.

You used the word “unethical” in terms of the medical aspects of this. I find it unethical.... If you don't believe in Bill C-393, then come here with a solution that's actually going to help. I stood in the halls of Parliament when we all stood together to say that we wanted to make a difference, wanted this law to actually work.

I want to use my time with Mr. Abbott, who has actually been there. Mr. Abbott has spent his time at the WTO, has spent his time on the TRIPS, has advocated for a number of different groups and organizations.

Mr. Abbott, we've heard from the department and the lawyers here that we're going to violate pretty well every international treaty under the sun—now including NAFTA—by working on this bill, but at the same time that this bill won't even work. It's an interesting scenario, but I would like from you your testimony about why Canada won't be violating any international agreement by changing this bill, or how we can do it.

[Rachel Kiddell-Monroe]

Yes, I absolutely do, and I think that is because of the entrance of generic competition into the market and bringing down the prices. That's exactly why that has been accomplished. We also have to remember there are still nine million people who have HIV/AIDS who do not have access to treatment. Those people are desperately in need. There is still a huge need, and the second-line, third-line drug issue is a big issue.

India is not going to be the solution to that. One of the big reasons is that many of those drugs are under patent in India. Due to its compliance with the WTO from the first of January 2005, it can no longer just produce many of those drugs under generic versions, so its prices will be higher.

Canada has a role to play in order to bring another player into the market, have their generic companies.... When Apotex came into the market, it forced Indian companies to go and make sure that their drugs were of adequate quality and get them pre-qualified with the WHO program. This was a hugely important aspect of what Apotex managed to do.

If the limitations are taken off, as would be the case under Bill C-393, we would be able to provide another player in the market, which would encourage competition.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

Thank you, Mr. Chair.

Thank you to the witnesses for coming today.

Ms. Kiddell-Monroe, while you and I may disagree on some aspects of this, I definitely appreciate the passion that you have for the issue. It's clear that you have a tremendous passion. And around this table--and from what Mr. Garneau said as well--if the question is do we want to help the people of Africa who are suffering, absolutely, I think that you'd find agreement all around the table and in this room. The question we're trying to answer today is does Bill C-393 actually accomplish this, or are there other things that are working or that we should be focusing on to accomplish this?

I go back to Mr. Kilby's testimony before the committee here the other day, when he was talking about the numbers of people who are receiving antiretroviral drugs. He talked about the numbers in 2003 and he said that 400,000 were receiving those drugs; by 2005 we got up to 1.5 million; and by the end of 2010 we expect to get to 5.2 million people being treated. That seems like a significant number. In fact Mr. Kilby, to quote him from the meeting, said:

Essentially a comprehensive model for care many believed could never be built emerged in a few short years. What has been accomplished is nothing short of a miracle, 5.2 million people on treatment by 2010.

Do you agree with what Mr. Kilby had to say regarding the progress?

[Rachel Kiddell-Monroe]

Bill C-393 actually specifically addresses some of the barriers that we saw in trying to use the legislation.

First of all, in terms of the countries and the notification, the system under the current regime makes a country declare its intention to the WTO to ensure compulsory licence. This is a huge barrier for developing countries when they face repercussions that they have from the U.S. government, from the European Union, and from pharmaceutical companies themselves. Bill C-393 will remove that barrier; that's the first thing.

The second thing is it's a one-licence solution. It simplifies it massively from the situation that we have now. It removes the need for the long period of voluntary licence negotiations. When there is a need there can be simply one licence issued by the Canadian government.

The other issue is that the proposed bill will remove the two-year limit on the compulsory licence and remove the quantity requirements. This is extremely critical, because what happened was that Rwanda made an order for a specific number of people, for a specific number of drugs. After they'd put in that order they realized that they actually needed more. In order for them to increase their order they had to go all the way back through the process from the beginning.

This new piece of legislation would remove that need. It will no longer require countries to be specifically identified; it will enable a licence to be given for an order for drugs for those countries that are listed. So that's how it still makes sure that it only goes to those countries that are listed, that are needed for this.

That will definitely go to the whole issue of creating a market. For a company like Apotex, while they said they would not use the CAMR as it stands again, they would, however, use the reformed CAMR as proposed under Bill C-393 and they deliberately said that they would produce a pediatric version of the Apo-TriAvir for export.

[Marc Garneau, Liberal, Westmount—Ville-Marie, QC]

Thank you, Mr. Chair.

First of all, thank you to the witnesses for your presence here this morning. This is a passionately debated issue, and I want to say for the record that I subscribe 100%. I would be out at the front of the parade with respect to any mechanism that will assure that we can get HIV/AIDS, malaria and tuberculosis, and other medicines to those who need them in Africa. I want to make that very, very clear from the beginning.

Ms. Kiddell-Monroe, thank you for your testimony. I'd like to hear from you succinctly in your opinion why Bill C-393will, if not open the flood gates to this medicine that is so needed in countries...why it will solve the problem.

[Dr. Frederick Abbott]

Good morning.

I appreciate the opportunity to appear before the committee regarding the bill to enact proposed changes to the CAMR.

I appeared before this committee on March 10, 2004, during what was then consideration of Bill C-9, which, as amended, was ultimately enacted as the CAMR. In the course of dialogue with committee members in 2004 I raised several concerns regarding the terms of the then draft legislation. I was of the view that a number of the restrictions and limitations under consideration would hamper effective use of the legislation as then proposed.

Though some improvements were made in the legislation prior to its adoption, it was clear that Canada had decided not to take full or effective advantage of the flexibilities in the TRIPS agreement, the Doha declaration, and the August 30 waiver. It was foreseeable that limitations would significantly restrict the ability of the CAMR to address very serious public health problems confronting developing countries, with limited or no capacity to give effect to compulsory licensing. It's therefore not surprising that this committee is revisiting CAMR with the objective of making it a more effective and useful mechanism.

Let me spend a few moments explaining why I might reasonably be considered to have expertise on the subject of legislation to implement the August 30 decision. I've written and published extensively on the subjects of the TRIPS agreement, trade and IPRs, and on the relationship between that subject matter and public health, including access to medicines. I regularly have served as an expert consultant to the World Health Organization, the World Bank, the WTO, UNCTAD, and other multilateral organizations regarding trade, IP, and public health matters.

I served as legal consultant to the group of developing countries that formulated the proposal for the 2001 Doha declaration, worked with those countries throughout the process in which it was negotiated and adopted, and subsequently advised a core group of developing countries that was primarily responsible for negotiating the August 30 waiver at the WTO from the inception to the completion of that process. I have written and published about those negotiating processes in the American Journal of International Law and The Journal of International Economic Law.

I prepared for the World Bank a set of model-implementing legislation and documents for developing countries to implement the August 30 decision. I would note that one of my draft notification forms was used by Rwanda in its notification to the WTO. I've been to Canada again in the review of the CAMR. I've participated as an expert consultant at UNDP to reconsider this bill.

Finally, I would note, as a matter of disclosure, that I'm presently advising the Government of India in dispute settlement consultations at the WTO, where India and Brazil have initiated consultations with the European Union concerning the seizure of generic drugs in transit through airports in the European Union, and that Canada is a third-party participant in that set of consultations.

The August 30 decision has been criticized by NGOs promoting access to medicines, by some academics, by some generic producers, and by some developing countries for establishing an overly cumbersome set of rules that make it difficult to give effect to the basic objective of permitting export of low-priced generic pharmaceutical products to developing countries. I've consistently observed that the decision was a process of a long and intensive negotiation involving stakeholders with decidedly different perspectives, and that the August 30 decision represented a compromise between those perspectives.

Neither the NGOs seeking to provide the easiest mechanism for facilitating access to medicines nor the originator pharmaceutical industry found or find the August 30 decision to reflect an ideal world of either access to medicines or industrial protection. But my own view is that it can be made workable with appropriate implementing legislation and with conscientious work by lawyers, pharmaceutical procurement specialists, and others, in giving effect to the provisions of the August 30 decision. Nonetheless, for whatever reason, the CAMR was designed to add obstacles to the provisions of the August 30 decision, which make it more difficult to implement in practice.

Why the approach of Bill C-393?

Bill C-393 seeks to streamline CAMR to take advantage of flexibilities inherent in the August 30 decision by providing a pharmaceutical producer with the opportunity to obtain a single licence from the commissioner of patents that will authorize it to make and use a patented pharmaceutical invention for purposes of export to developing countries that identify public health needs.

A principal reason for proposal of the single licence is to solve a significant problem affecting the way international pharmaceutical procurement works in practice.

Many or most pharmaceutical procurement authorities acquire medicines by publishing a request for bids or proposals for supply of medicines, soliciting a response from industry. Competitive bidding isn't always practised. Nonetheless, it's extremely difficult for a producer, for example a prospective Canadian supplier, to respond to a bid request conditionally, indicating that supply is predicated upon obtaining a compulsory licence and that obtaining that compulsory licence may be a lengthy process that involves modifying a government list to add the subject-matter medicine to a list of products, opening negotiations with a patent holder or patent holders for a voluntary licence, and awaiting an ultimate determination by the commissioner of patents regarding whether a licence should be issued.

A public health procurement authority in a developing country would and should be understandably reluctant to award a contract based upon the fulfilment of an uncertain set of contingencies on the part of the producer-supplier.

Requiring a Canadian producer to request a compulsory licence on a case-by-case, country-to-country basis presents obvious difficulties. It presumes that a producer can and should develop a pharmaceutical production line to fulfill a single contract to be negotiated and put into effect over a protected period of time. But the licence is set to terminate after two years.

Simply put, you have heard and undoubtedly will hear from Canadian generic producers that this is a non-economic proposition. It's almost certain to drain business and personnel resources--

[Dr. Amir Attaran, Canada Research Chair, Law, Population Health, and Global Development Policy, University of Ottawa, As an Individual]

Thank you, Mr. Chairman, and good morning.

I'm an anglophone, so I'll speak in English, but I would be more than happy to answer your questions in French.

I'm a professor in the faculties of medicine and law and the Canada research chair for population health and global development policy at the University of Ottawa.

I began my research on access to medicines over a decade ago while employed at Harvard, Yale, and Chatham House in London. I've published on the subject in The Lancet and in the Canadian Medical Association Journal. In full disclosure, I am or have been on the editorial teams of both those medical journals. I've also been unusually privileged to serve on all sides of this debate as a consultant. I have served Médecins Sans Frontières as a consultant at one time and I've served developing country governments such as Brazil and Malawi. I've served drug companies such as Novartis and international organizations like the World Health Organization and the World Bank.

I thank you for calling on me to discuss Bill C-393, and as I sit here I know all of you, all members, all political parties approach this bill with good intentions. This is clear. And you have hopes and prayers that will help the world's poor. This is clear. It is therefore my unhappy job to tell you why I think the bill will probably have zero results for public health and would likely even do harm. Please let me explain.

When CAMR was enacted in 2005, its raison d'être was to make it possible for poor countries to buy cheaper generic medicines manufactured in Canada. To make this possible, CAMR authorized patent overrides of a kind called compulsory licences, and Parliament believed that by overriding patents in cases of acute humanitarian urgency like malaria, like AIDS, poor countries would beat a path to Canada's door for those medicines.

However, as you know, it hasn't worked out that way. Everyone agrees that CAMR has been a one-shot wonder, and only a single country, as Rachel correctly said, Rwanda, bought medicines under CAMR from a Canadian company, Apotex. As Apotex's own spokesperson, Elie Betito, said to the Ottawa Citizen, “We will not be doing this again.” Everyone agrees, this law is a failure.

Well, how come? In a correct diagnosis, CAMR has failed for economic and not legal reasons. The causes of failure are not in the statute of CAMR, which Bill C-393 could amend, but in reality the causes of failure are in global medicine markets, which no conceivable bill can affect. Rachel's correct about this. I'm sorry to say so, but Parliament simply is powerless to make this law work.

Here's the basic problem: for CAMR to succeed and achieve regular exports of Canadian generic medicines to poor countries, it's necessary for those Canadian generic medicines to be priced competitively compared to other generics on the global market. If Canadian generics cost more than foreign generics, poor countries will buy foreign generics, as well they should: that's how free trade works.

Canadian generics, though, and this is unfortunate, are among the most expensive in the world. And let me share with you some data from the federal government's Patented Medicine Prices Review Board. In 2006 this federal agency compared generic medicine prices in Canada and abroad and it found that compared to Canada generics cost 35% less in America, 51% less in Finland, and a whopping 77% less in New Zealand. Now, I emphasize that these are not industry-sponsored data. They are not activist-sponsored data. They are federal government data of a federal government agency and are trustworthy. What they show is that Canadian generics are among the most expensive in the world, and certainly the most expensive in that study. And as you might guess, overpriced medicines don't sell.

So put yourself in the shoes of an African health minister. Why use CAMR to buy generics from Canada when you can buy generics from America, Europe, India, China, New Zealand, and what have you, for less? This economic reality makes it puzzling why certain AIDS activists insist on supplying the world's poor with Canadian medicines manufactured under CAMR. It's patriotic of them. It's definitely well-meaning of them, I don't wish to take that away; it is well-meaning, but it's also naive.

By selling poor countries more expensive Canadian medicines, the corollary is that fewer patients could be treated on a given budget. It could do harm.

Knowing this, the activists support Bill C-393's amendments to amend the Food and Drugs Act and remove generics produced under CAMR from Health Canada's regulations. That aspect of Bill C-393 is, frankly, terrifying. For activists to champion the deregulation of life and death medicines to save a buck, it is not simply vertiginously irresponsible, it's also medically unethical.

If I may have one minute, I'll wrap up.

In closing, my advice is to forget about Bill C-393 and accept the present reality that including Canada, as elsewhere, there are about 30 countries with such laws. Laws such as CAMR don't work.

This is not to say the House should cease caring about public health in poor countries--far from it. Please maintain your interest, but take the energies, the very good, well-intentioned energies you and others have, that are now absorbed in the sinkhole of CAMR and direct them to reforms of other kinds.

Fix the fact that CIDA is a sclerotic agency. Fix the fact that one-third to one-half of malaria medicines, like I'm holding here, are fakes, are counterfeits in developing countries. They kill children. Stop exporting asbestos. These are things Canadians can do that will save lives. Bill C-393 I don't believe will.

[Rachel Kiddell-Monroe, Chair, Universities Allied for Essential Medicines]

Good morning. Thank you for inviting me to your meeting. I am very happy to be here.

I also want to thank my students from McGill University, who gave me permission to be here today. Another professor is replacing me, and I'd like to thank him as well.

I have worked with human aid organizations, mostly in Asia and through the Doctors Without Borders organization. Memories of Africa still haunt me.

My team took over a project from the French military in 1994 in the dying gasps of the genocide in northwestern Rwanda. We walked into a very fine hospital with fine surgical units, with wards where the patients could be. There was one room where the doors were locked. I asked, “What is behind this door?” I was told those were people I could do nothing for and just to focus on the people I could help. I asked to look behind those doors, and what I saw basically were breathing skeletons. They were people who were dying from HIV/AIDS. At that time, while patients in Canada, Britain, the U.S., and many other developed countries in the world were able to receive life-saving HIV/AIDS treatment, those people did not have access.

I called my headquarters and asked if we could get some medicines for those people: “What we can do? We have to help them.” They said they were sorry, but it would cost $12,000 per patient, per year. They said: “These people have a chronic disease. We cannot help them.” So we had to sit every night and hold these people's hands. We had to comb their hair and talk to them because we were the last people who were to have any contact with them. We watched those patients die.

I believe it's important to bring that to you people here and to those who say we shouldn't make this an emotional issue. But this is about human lives. This is about people who are dying while people in our countries do not have to die. This is about a situation where people do not have access to essential medicines.

It's not the first time I have appeared before this parliamentary committee in the last seven years, which is how long I have been working on this issue. I first appeared in 2004 before this same committee, urging it to reform Canada's access to medicines regime as was then proposed, because there were fundamental flaws in it. The legislation was passed as it was, and we decided as Médecins Sans Frontières to try to test the legislation, because there was so much goodwill, both in the government, the Prime Minister's Office, and from all parties who voted in favour of the legislation and making this work.

So we decided to try to test it. After four years—four years—we managed to get one drug for a limited number of patients to one country. In those four years, about 40 million people died because they did not have access to essential medicines.

We're not saying that Canada is the solution to the whole crisis, but that Canada has a role to play. Canada is not a panacea, but it has an international commitment that it took in 2003 to try to make the August 30 decision work in Canada. We still have that commitment today. We can do it better, and we should do it better.

I worked with my colleagues inside of MSF, and Cailin Morrison in particular, as well as Richard Elliott from the Canadian HIV/AIDS Legal Network, to try to make this order happen, with all the best intentions and goodwill. We went to many countries through our MSF teams, asking governments to please apply and to use that piece of legislation. When we approached the health ministries, they were all thrilled. They would say: “Wonderful, it's another way maybe we can get drugs for our people at last. We need every single mechanism we can find to treat our patients.” We were hopeful. Then when they went to their foreign affairs ministries or to their trade ministries, a block was put on it.

Why was that block put on it? The block was put on it because of the experiences of countries like Thailand, who tried to use flexibilities in their regimes to use compulsory licensing, as Richard Dearden was saying earlier, in domestic situations. When Thailand used a compulsory licence, sanctions immediately came down on them. Abbott, a pharmaceutical company, withdrew drugs and threatened to withdraw other drugs from the Thai market if they didn't change the way they were acting. The U.S. government put Thailand onto the 301 watchlist, as a partner who should not be trusted in matters of intellectual property.

The European Union trade commissioner, Peter Mandelson, sent a letter to the Thai government, threatening them over their use of compulsory licenses and saying they should spend more time negotiating with pharmaceutical companies. They had in fact held over 20 meetings with pharmaceutical companies on this issue to try to get AIDS drugs for the dying Thai population.

Why is the law failing? Some people will refer to market failures, as my colleague on my right will say. Well, I would respectfully submit, the market failures are not an issue for parliamentarians around this table. What you have to do is to make a law that has all the best chances to win, which Bill C-393 has. The market issues are things that should be left to the pharmaceutical companies and the generic companies in trying to make it work.

I would say that references to other forms of fixed-dose combination, which are not same as the fixed-dose combination Apotex produces, will not give fair price comparisons.

Finally, I would like to raise something that has been of great concern to me and many of my colleagues. We've been hearing that there is a move afoot to kill Bill C-393. In the next session, when a vote has to be held on the new sponsor of this private member's bill, there will be people who will prevent it from passing. I would like to submit that this is not a way to democratically deal with the bill, and it would definitely undermine the extremely important work this honourable committee is doing. So I wanted to raise that to your attention, and I do sincerely hope, as a new Canadian citizen, who got her citizenship in March this year, that this is not what Canada would do to this bill.

As a final thing, when I came here to Canada with my family, I had promised the patients I had worked with for over 15 years in Africa and Asia that I would be able to do something here. I believe that Canada is a great country and we have a power to make change.

Thank you.

[Richard Dearden, Partner, Gowlings, As an Individual]

Thank you, Mr. Chair and members of the committee, for permitting me to testify about why, in my opinion, Bill C-393 fails to comply with Canada's international treaty obligations.

I am a partner at Gowling Lafleur Henderson. I have practised international trade law for over three decades. You'll find a short biography in tab 1 of my written submissions. Those written submissions, members, explain why Bill C-393 violates the TRIPS agreement and also the carefully negotiated international solution to the access to medicines problem embodied in the WTO's General Council decision of August 2003.

Today I wish to address two points for your consideration, if I could. Firstly, Bill C-393's one-licence regime is not authorized by flexibilities found in the TRIPS agreement. And secondly, TRIPS article 30's limited exceptions provision does not authorize Canada to abrogate its compulsory licence obligations that Canada has agreed to, both in the TRIPS agreement and in the General Council decision.

Now, point one, you'll hear some people argue that you can replace CAMR, Canada’s access to medicines regime, through flexibilities available under the TRIPS agreement. The 2001 Doha declaration required members to maintain their commitments in the TRIPS agreement but recognized that there were flexibilities in the TRIPS agreement. And it gave several examples, one of which was compulsory licensing. But the compulsory licensing obligation that existed at the time was only predominantly for the supply of the domestic market, so it didn't solve the problem.

That's why, Mr. Chair and members of the committee, the WTO ministers gave the following instructions to the TRIPS council. And they're found in paragraph 6. That's why you hear of it as the “paragraph 6 system”. It reads:

We recognize that WTO members with insufficient or no manufacturing capacities in the pharmaceutical sector could face difficulties in making effective use of compulsory licensing under the TRIPS Agreement. We instruct the Council for TRIPS to find an expeditious solution to this problem....

And that expeditious solution, Mr. Chair and members, is what you find in the 2003 General Council decision.

So Canada can only rely on this decision to issue compulsory licences for export if it complies with the conditions in that decision. And in my respectful opinion, CAMR does that and Bill C-393 does not.

I'd also, as a sidebar here, point out to you that my submissions only deal with TRIPS, but NAFTA has an almost identical compulsory licence obligation in article 1709(10). And you should know that Canada and the U.S. entered a memorandum of understanding that suspended the compulsory licence obligations you find in NAFTA article 1709(10)(f), which was identical to the TRIPS compulsory licensing obligation. That suspension is only valid with respect to the compulsory licence issued in accordance with the WTO General Council decision.

So if the Bill C-393 system were allowed, in my respectful submission, it would be violating NAFTA article 1709(10) because it allows for any drug, in unlimited quantities, for an unlimited term, for export to 140 countries. And that is not in accordance with the General Council decision. It would be offside the NAFTA obligations. And Canada, in my opinion, would end up in a dispute settlement panel under NAFTA.

My second point, Mr. Chair, is with respect to an argument that the single-licence regime proposed by Bill C-393 would be authorized by a limited exceptions provision we find in article 30 of TRIPS. Now, let's not forget, Mr. Chair and members of the committee, that the WTO membership rejected TRIPS article 30 as an expeditious solution to the access to medicines problem. But even if article 30 was available to Canada, the burden would be on Canada to demonstrate before a WTO panel that this one-licence regime is a limited exception; does not “unreasonably conflict with normal exploitation of the patent”; and does not “unreasonably prejudice the legitimate interests of the patent owner, taking account of the legitimate interests of third parties”.

Canada lost a WTO case involving a Patent Act provision that allowed generic manufacturers to stockpile pharmaceutical drugs for the last six months of a 20-year patent term. We lost that. Canada defended it by arguing that it was okay using the limited exceptions under article 30. The panel rejected that, saying six months was a commercially significant period of time, especially since there were no limits at all on the volume of production allowed or the market destination of such production. So rather than being a limited exception, Mr. Chair, Bill C-393is an unlimited exception because it authorizes a compulsory licence for any drug, in unlimited quantities, for an unlimited duration of time. It does not take into account the legitimate interest of patients who benefit from the incentives that patent protection provides for research and development of life-saving drugs or drugs that improve Canadians' quality of life.

In conclusion, Mr. Chair, what are the proponents of Bill C-393 asking you to do? They're asking you to bypass the WTO and unilaterally renegotiate Canada's compulsory licence obligations through this one licensing system. But what has changed in terms of compliance with our international treaty obligations since the Minister of Industry's 2007 report on the statutory review of CAMR? The only change has been that Canada has accepted the protocol amending the TRIPS agreement that would make the general council decision a permanent amendment. So rather than Canada retreating from CAMR, Canada has in fact further entrenched its commitment to CAMR.

Thank you, Mr. Chair and members.

[Richard Elliott]

Thank you.

Let me just address two points quickly, to get back to the question that a few people posed.

The first point is the issue of diversion of medicines, which of course we don't want to see happen. Dr. Kilby put it very well. We have to take some risks here. The legislation preserves the measures that were already negotiated and in place to mitigate the risk, to minimize the risk of diversion happening, and, let's not forget, that we cannot let the perfect be the enemy of the good here.

We have not had a significant problem with diversion, for example, of the donated discounted brand-name drugs that have been provided in these countries because they are using the same sorts of mechanisms that are provided for here for generic drugs. That has not been a significant problem.

That is not to say never say never. Should there be at some point a shipment of medicines that gets diverted, let's say if 99% of the shipment got through and we saved hundreds of thousands of lives because of it, if one shipment went missing, that is a price worth paying. But we have mechanisms in place that are there to prevent that from happening. Let's not overstate the risk there and use it as an excuse for not fixing this and making it workable.

The second point I wanted to speak to was your question about the amendment to the Food and Drugs Act. It is fair to say that the core of the problem with the current access to medicines regime has been the licensing process. The process about how you review the drugs for quality and safety and so on is secondary.

We should, if there are difficulties with something like the proposed subsection 38(1) that's in Bill C-393, look at that. If you feel it doesn't provide adequate protection for making sure that things are properly reviewed before they get to the countries, let's tweak it and let's make it work there, but let's not lose sight of the core objective here and use that as an excuse to not pass this.

The reality is if you talk to the generics—I think they'll tell you this next week—they're going to go through the Health Canada review process anyway, because that is the thing they are familiar with. So as you see in this proposed provision in paragraph 38(3)(a), all of the existing regulations that are made under part II of the Food and Drugs Act, section 30, which is the one that has all of the regulations about quality, safety, and efficacy, will be entirely applicable. Bill C-393 will not change that.

[Richard Elliott]

That's right. I will continue in English, if I may.

The majority of the 5.2 million people who are receiving HIV treatment now in the developing world are on generic medications because that's what has made it affordable. That's how we've made the progress Mr. Lake was referring to.

There is nothing now that prevents the patent-holding brand-name companies from selling in those markets, and there is nothing in CAMR and nothing in Bill C-393 that prevents them from doing that. The point of having a patent is you actually have the right to sell the product. In fact, you have the exclusive right to sell the product unless someone else gets a licence, which is what CAMR is supposed to do.

This is simply about opening up the field, allowing greater competition in those markets. When the brand-name companies have had to face competition in the developing world selling their products, we've seen that that is what has brought the prices of medicines down. We need to keep that dynamic going. That's the purpose of something like le Régime canadien d'accès aux médicaments.

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

The thing that concerns me is that while we want the same thing, we recognize there are issues. I think the issues you're talking about, the things we need to address, we can probably have a common conversation around, with agreement on many things. What we've heard from the experts—and keep in mind that the government experts who were before us at the previous meeting aren't partisan experts, they were people who were the experts under the Liberal government and they're the same people who are the experts under the Conservative government—from four different departments was that they were adamantly opposed to this bill, saying the bill would accomplish virtually nothing and yet would have untold unintended consequences. And that's very concerning to me as a member of Parliament.

Again I come back and I'd just like you to comment if you could on the health question I asked. Does it not concern you that under C-393 we would have a regime whereby drugs are being approved by a country in Africa and having no approval process subject to the same considerations that a Canadian using those same drugs would be subject to?

[Richard Elliott]

Yes, I can.

I wanted to, before I forget, draw your attention to a document that you have in the materials we gave you. This is a briefing paper prepared by Doctors Without Borders--Médecins Sans Frontières--describing their experience of attempting to use the legislation, working with Apotex to get this drug because MSF had identified that they needed it.

This part of the story that MSF lays out in this brief walks you through the chronology. However, it stops in the middle of 2006 because MSF ultimately abandoned the effort to use it, after trying for about 18 months to get a country to come forward.

When we hear repeatedly that it only took 68 days from start to finish for this piece of legislation to work, to get this licence out the door, that leaves out of the story the entire months and months and months leading up to the point where finally a country did come forward. That's because the law, the way it's drafted now, requires that the country be known ahead of time in order to then move through the process of trying to get a licence. But that's not the full story if you just look at, “Oh, now we finally have a country, so we can start the process of trying to get a voluntary licence from the brand-name company, and if that doesn't work after 30 days, then we can try to get a compulsory licence to supply a fixed quantity of a drug for only two years”, and so on.

All of the back story is left out of that narrative, about why this bill took so long to even have one successful use. It's because it created this kind of impediment where you made the use of it contingent upon knowing one specific country ahead of time.

That's why the one-licence solution that is in Bill C-393 would get around that problem, because it would say it's not contingent upon having one country identified ahead of time to get a licence. You get the licence and then you go out and actually bid to supply countries. If you're offering a good product at a competitive price--which you would be in a better position to do if this is simpler to use--then you can actually supply because you have the licence already to supply that eligible country.

So I would encourage people to learn what the experience was and where the stumbling blocks were encountered with the existing legislation, which is precisely what we thought they were going to be. I think we can then learn from that to make it work better.