Information & Ethics Committee on Dec. 4th, 2020

[Pierre Paul-Hus, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Okay, but—

[Frank Baylis]

Before I go any further, Mr. Paul-Hus, I want to be very clear. I think that you said that I tried to create a shell company or something of that nature. However, I didn't know Mr. Jamieson. I had never met him before in my life. I didn't know anyone in his consortium. They were the ones who called us. We're recognized in the field. We're one of the largest medical device companies in Canada. He called us and asked us for help. That's what he asked us for. I think that he called on March 29 or 30, but I'm not sure of the date.

[Pierre Paul-Hus, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Mr. Baylis, this date coincides exactly with the deadline for the call for tenders, which was March 31. FTI Professional Grade was created the same day. Seven days later, it was awarded the contract by Public Services and Procurement Canada. This raises many issues. It sounds too good to be true. It sounds like a fairy tale. We're talking about a $237-million contract. That isn't a small contract. We're talking about a contract worth a quarter of a billion dollars that was settled in no time. Canadians find it very hard to believe that it wasn't fixed.

Let's talk about prices. We know that the PB560 ventilators sell for $13,000 on the market. You're selling them for $23,000. For the whole contract, this amounts to an additional $100 million.

Can you explain to Canadians why we paid an additional $100 million for a contract that was awarded in the blink of an eye?

[Frank Baylis]

We can certainly answer your question about the prices.

I'll turn the floor over to Mr. Godara. As vice-president and general manager of this section, he set the price. He can explain it to you in detail.

[Neil Godara]

Thank you.

I'd be happy to explain exactly how we approach this.

Our device is a replica of the Medtronic PB560 ventilator. The way we approached it is that we priced our ventilator the same as the Medtronic PB560, which was $10,000 U.S. at the time. That's what we started with.

The reality is that what we're providing is more than the base ventilator, because we had to accessorize and configure the ventilator for appropriate use during COVID. There are three separate areas we had to account for.

The first is that the ventilator that we provide had to be provided with many more accessories so that, when it was ultimately delivered to a hospital and starting to be used on multiple patients, which is different than how the PB560 would be used, it would be ready to go. We provided 10 times the number of accessories called exhalation blocks. We provided 10 times the number of inlet filters. We provided six times the number of oxygen inlet connectors. We specially configured the ventilator for appropriate settings for COVID. Additionally, we set it up with settings that are appropriate for COVID patients.

That was bucket one, which was to really flesh out systems that are appropriate for those patients.

[Pierre Paul-Hus, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Thank you—

[Neil Godara]

There are two other buckets related to the cost. I'd like to explain, if I may, because I know this is one question that has come up often.

The second one was that we had to establish a completely new manufacturing facility dedicated specifically for ventilator production. We had to hire 250 people and get special tooling, equipment components, and we also had to secure a global supply chain.

We had those two, and then the third one is that, beyond that, we had to account for the fact that during COVID things were much different than when the PB560 would be made. There were major changes in shipping costs. We knew that—

[Pierre Paul-Hus, Conservative, Charlesbourg—Haute-Saint-Charles, QC]

Thank you, Mr. Godara. I'm sorry to interrupt you, but I'm running out of time for my questions.

Mr. Jamieson, your company manufactures brakes. Where did you get the idea to make ventilators?

[Rick Jamieson]

It's exactly what I said in my opening introduction.

We thought we could make ventilators. Our theory for Ventilators for Canadians was to go license a ventilator. I make auto parts every day. We make a safety device. First of all, in auto parts, when making brakes, you have to stop a car at a very high speed. The complexity of making a ventilator and meeting regulatory requirements in the United States is quite similar; it's just a different way—

[The Chair, Conservative, David Sweet]

Mr. Jamieson, I'm sorry to interrupt you. At committee, time is always our enemy. I gave you a few seconds more just so you could get some answer in.

Please do feel free to expand on your answer during another question from another member if you'd like, but I'm trying to arbitrate and be fair with time.

[Rick Jamieson]

That's no problem.

[The Chair, Conservative, David Sweet]

Now we go on to Mr. Fergus for six minutes.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

The trick, Mr Chair, is always to find that unmute button. Thank you very much.

Thank you to the witnesses for coming here today.

My questions are going to be for Mr. Baylis in particular. Before that, Mr. Baylis, on behalf of myself and my colleagues all around the table, we'd like to extend to you our condolences on the recent passing of your father a couple of weeks ago. I'd like to share that with you.

Mr. Baylis, did you in any way try to influence the government to issue the contract for ventilators to Mr. Jamieson's group?

[Frank Baylis]

Thank you, Mr. Fergus, for your kind words about my dad.

I know that has been suggested. I can state unequivocally here that I did not speak to.... People said I spoke to the Prime Minister. I did not speak to the Prime Minister. I did not speak to cabinet ministers to ask them or influence them for a contract. I did not speak to members of Parliament of any party. In fact, I didn't speak to anybody to try to influence them to give a contract to Baylis Medical or to Mr. Jamieson or to Ventilators for Canadians.

I was involved in one phone call that Mr. Jamieson had set up, which had to do with the advancement that we needed to go secure the parts. That was my involvement with Mr. Jamieson as he was negotiating and putting together this consortium. I was not reaching out or doing any kind of backroom—as it's been suggested—request to anyone to get me a contract or to get Mr. Jamieson a contract, or Ventilators for Canadians or FTI.

In that light, I can say I did not speak to anybody, whether in government or not.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

I appreciate that. Let me just build on that and your answer.

When did you first find out that Mr. Jamieson's group had been awarded the contract for ventilators?

[Frank Baylis]

I think he had it on April 11, I believe.

This was happening very fast, Mr. Fergus. It was a whirlwind of activities. He had said that he was working on this and pushing it forward. In those first few weeks, we saw the tragedies unfolding around the world.

When we think about New York state and New York City, it's very close to our major cities—

[Greg Fergus, Liberal, Hull—Aylmer, QC]

Very much so.

[Frank Baylis]

—and COVID did not know political barriers, so it was a rush and a very pressurized situation, I can tell you that.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

Mr. Baylis, in spite of the recent passing of your father, I'm certain you were monitoring what was being said about you in the media or at this committee. I'm certain you noticed that the Ethics Commissioner had found no reason to investigate you.

Can you explain why, apart from a political witch hunt, you are here today?

[Frank Baylis]

Obviously, Mr. Fergus, it saddens me in a certain way that this has happened.

I understand that I am a past member of Parliament and things will be politicized and that there are people who will see that there is political gain to be had by that. I understand that; I'm not naive.

I can tell the Canadian people, and I can state unequivocally, that I did not use any relationships to try to get any contract for anything. I have not done that. Not only that, I am very proud of what we've accomplished.

There have been a number of statements, as you said, Mr. Fergus. First of all, there have been 14 contracts—not one or two, but 14 separate contracts for ventilators and accessories. Mr. Jamieson's contract and FTI's Ventilators for Canadians is just one of 14. These ideas that it was single-sourced are falsehoods that have been spread, if I could say that.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

Mr. Baylis, I have one final question.

As a former MP, you are aware that anything you say in this committee is protected by privilege. Is there anything you would like to say to some of the members who have made what I characterize as outrageous statements about you, your company and your partnership with Mr. Jamieson?

[Frank Baylis]

No, I understand the political game.

I think what everybody should know and what everybody should really feel good about is that this is a wonderful coming-together. This could not have been done without the work of Mr. Jamieson and this consortium, which provided logistics, manpower and procurement expertise. Really, I think people should see the wonderful thing of these people coming together, of different stripes, different businesses, and I might even say different political inclinations.

I'll let Mr. Jamieson explain how we all came together.

Rick, I don't know if you want to mention something there too.

[Rick Jamieson]

The only thing I would mention is that I did not know Mr. Baylis, number one.

Number two, it never dawned on me that politics would ever enter into my relationships with my subcontractors.

That's it. We were doing a job that we thought.... I can tell you that we worked 16 hours a day and we had a huge team of people who were involved in this project. I did not know who Mr. Baylis was. Actually, I didn't know who Baylis Medical was. Despite the fact that this is a big company, I'd never heard of them before.

I'm in automotives. They don't run in my circles. I don't know these people.

[Greg Fergus, Liberal, Hull—Aylmer, QC]

Thank you very much.

Mr. Chair, do I have any more time?

[The Chair, Conservative, David Sweet]

You have three seconds, Mr. Fergus, just enough time to find your mute button.