Health Committee on Dec. 6th, 2023

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

Thank you, Mr. Chair.

Good morning, Mr. Minister. Good morning, Dr. Sheppard, Dr. Lourenco and Ms. Jeffrey.

Mr. Minister, when the agreements were signed with the seven companies, you knew there was a problem. When the Medicago vaccine was authorized, and the WHO rejected it, we asked questions, but everyone was dodging, and no one wanted to answer.

We now know that the government was fully aware that there was a problem because it had signed the Framework Convention on Tobacco Control on February 27, 2005. Last week, officials from Public Works and Government Services Canada confirmed that. The director general and the deputy director general confirmed that the government knew there was a problem. Today, we learned that we are losing $323 million and that the government has taken a risk.

Are you prepared to admit today that this risk was known and that you went ahead anyway?

[Mark Holland, Liberal, Ajax, ON]

All the advance purchase agreements, every single one of them, was a known risk, and we knew that not all seven would pan out, first of all.

Second, as I previously indicated, Medicago was in fact approved on February 24, 2022. The decision by the WHO is separate and apart from the use in a Canadian context, but 100%, all seven, came with risks. We had to do that, because there was no way we would get companies to agree to enter into advance purchase agreements without placing money on the table to ensure that they would have their investments covered.

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

You were fully aware that there was a problem. That has been confirmed. First, you knew that Medicago would not be authorized by the WHO and that Canada was in violation of the Framework Convention on Tobacco Control. Second, after the federal government invested $323 million, that company left, without reimbursing any money.

The Government of Quebec also had an agreement with that company, but it had provided for reimbursement provisions, and Mitsubishi confirmed that it would reimburse the Government of Quebec. Why didn't the federal government include these kinds of clauses, or, if it did, why don't you disclose them?

[Mark Holland, Liberal, Ajax, ON]

First of all, I wholly and completely disagree that we knew there was a problem. The fact of the matter is that, as I said, WHO and the decision it made was under the context of having all kinds of other vaccines available. The decision was completely separate and apart from the decision made in Canada, which was to approve the vaccine. It was in fact available. The reality is that the vaccine was available. The WHO decision did not affect that.

Second, the WHO decision was in the context of all kinds of other vaccines that were already approved. Trying to simplify it that way is simply not accurate.

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

That's fine, Mr. Minister.

The vaccine has been approved by Canada. You said earlier that even if the WHO didn't agree, it could have been used in Canada. Many people didn't want to have the other vaccines, including those from Pfizer and Moderna, because they were mRNA vaccines, but they would have liked to have the Medicago vaccine. Why not make this vaccine available to people who preferred to have another type of vaccine?

[Mark Holland, Liberal, Ajax, ON]

The reason was that we had what we needed. You're right—there was mRNA hesitancy, but we had non-mRNA options that were already on the table. Actually, that's a success of the advance purchase agreement we did, because that way we not only had mRNA, but we had non-mRNA options. At that point in time, Canada had the vaccines it needed, and it meant that we didn't need to proceed with Medicago. Therefore, that was the right decision.

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

However, I'll go back to my original question: Do you admit that you made a mistake when you signed an agreement with Medicago?

There were already six other companies with vaccines in development, and you invested $323 million in a company that, by its own admission, was going to take much longer to develop its vaccine and was far from certain of the outcome. It took them two years, less time than they had anticipated, but whether it was an unnecessary risk at the time remains to be seen.

[Mark Holland, Liberal, Ajax, ON]

Fundamentally, no. If I were the health minister at that time, I would have 100% made this decision. It was the right decision. We could not have known which of the seven would work out. I'm deeply proud not only of the government but of officials entering into these agreements and ensuring that Canada had them.

Look, if I could go back in time and not sign a contract with the knowledge that I have now, I sure would. However, I didn't have that knowledge. No one had that knowledge. No one was clairvoyant.

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

Thank you.

[Mark Holland, Liberal, Ajax, ON]

There was no JoJo the psychic to call.

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

Thank you, sir.

I have one last question, which has to do with contracts.

When I was at the Standing Committee on Government Operations and Estimates, we did all the checks on Pfizer and Moderna to get prices. The Minister of Health at the time, Ms. Anand, always said that it was secret. Meanwhile, the United States, Israel and the European Union were disclosing the price of their vaccines. We know that the Americans were paying $7 a dose. In Canada, we did some calculations, and we came up with about $25.

Why, even today, are we unable to know how much the vaccines have cost?

[Mark Holland, Liberal, Ajax, ON]

When we enter into contracts as a government, there are confidentiality agreements that are signed. Those confidentiality agreements, frankly, assure us the companies will sign contracts with us. If we didn't do it, we would do no business with anybody. It is an absolute requirement of our doing business, but what is important is that the public accounts committee and the Auditor General receive the full, unredacted documents. On the Auditor General—if you want to give me a moment—I can read what she said in explaining exactly.... The Auditor General said:

In such an environment, advance payments and obligations for minimum purchase were required. Furthermore, Canada had very limited domestic capacity to produce vaccines and therefore was reliant on international imported products.

She continued:

We found that, although a non-competitive approach was taken, Public Services and Procurement Canada exercised due diligence on the 7 vaccine companies by conducting assessments to examine the companies’—

[Stephen Ellis, Conservative, Cumberland—Colchester, NS]

I have a point of order, Mr. Chair.

[The Chair, Liberal, Sean Casey]

Yes, go ahead, Dr. Ellis.

[Stephen Ellis, Conservative, Cumberland—Colchester, NS]

Again, I do want to significantly object to the minister's grandstanding and moving well beyond the five minutes. It's 50 seconds, indeed well beyond the Conservative member's time of five minutes, which sadly, Chair, gives him an opportunity to grandstand his clairvoyance that he wishes he had, doesn't have or thinks he has. It's totally inappropriate at this committee.

[The Chair, Liberal, Sean Casey]

Thank you, Dr. Ellis.

It seems there's a bit of grandstanding going on all over the place.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

I have a separate point of order, please.

[The Chair, Liberal, Sean Casey]

Go ahead, on a separate point of order.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Thank you, Mr. Chair.

Since the Liberal Minister of Health, a couple of times tonight, has thrown the Liberal Minister of Industry under the bus on the intellectual property side, I think it's incumbent upon this committee to urgently have the Minister of Industry before it to answer for the lack of IP ownership and the failure, by his efforts, to ensure it was in.

By the minister's own standards, he's not responsible. As part of the point of order, can you inform us when the Minister of Industry will be here?

[The Chair, Liberal, Sean Casey]

Thank you, Mr. Perkins. That is not a point of order. The Minister of Industry has been invited. We have not yet been successful in securing a date, but he has been invited.

We are now going to go to the last questioner for this round, and that's Dr. Hanley, please, for five minutes.

[Brendan Hanley, Liberal, Yukon, YT]

Thank you, Minister, for being here.

Thank you, officials, also, for attending. Thanks for answering some tough questions. You did ask a couple of tough questions as well.

I'm picking up on a theme that my colleague, Ms. Atwin, started. How would you describe Canada's domestic vaccine manufacturing capacity before March 2020?

[Mark Holland, Liberal, Ajax, ON]

It simply wasn't there. COVID-19 illuminated a lot of areas where we had to do better. At the time, I was the whip. I think back to that moment and looking at the parliamentary pandemic preparedness plan. I asked for it, and I was given a single piece of paper. Nobody could have imagined what was coming.

We have to take the lessons, and one of those is making sure we have domestic manufacturing. That's why we are developing the ability right now to develop mRNA and influenza vaccines here, domestically. That's huge. It's huge for industry and it's huge for protection of public health.

[Brendan Hanley, Liberal, Yukon, YT]

Yes.

Can you describe how we got to that position, where we'd lost vaccine-manufacturing capacity?

[Mark Holland, Liberal, Ajax, ON]

There were cuts made by successive governments, most particularly by the Conservatives, who cut deeply into these areas. I think that's one of the things we have to be very careful about in public health. The Conservatives talk about cutting, so they have to cut. You can cut and cut in public health, but when you cut, you don't always see the impacts of those cuts right away.

When you have a public health emergency, or when, over the span of time, you have the impact of underinvesting in public health.... Of course, having those cuts ends up being much more costly and damaging.

[Brendan Hanley, Liberal, Yukon, YT]

Therefore, you might say that more short-sighted governments are inclined to cut public health spending when they see success in programs, rather than proactively investing to be prepared for emergencies and crises.