Thank you.
I'm here on behalf of the Canadian Health Food Association, Canada's largest trade association representing over 1,300 businesses across the natural, organic and wellness sector.
How natural health products are defined in law shapes how they're regulated and whether that regulation is proportionate to risk. In 2023, the budget implementation act brought natural health products into the definition of therapeutic products, which included pharmaceutical drugs and medical devices, extending provisions of Vanessa's Law to this sector. This significant change came through an omnibus budget bill, without the focused consultation and scrutiny it deserved.
Natural health products are not drugs. Natural health products differ fundamentally from pharmaceuticals. This sector is built largely on small and medium-sized businesses often making multi-ingredient products without pharmaceutical patent protection or pharmaceutical margins. They do not have the ability to make disease treatment claims and, most importantly, these are products for the maintenance of good health, which means they can be safely taken daily.
Canada has long recognized those differences through a distinct regulatory framework, yet businesses now face overlapping pressures from labelling changes, proposed cost recovery and expanded regulatory requirements. This is how red tape grows: one requirement at a time until the cumulative burden threatens the businesses expected to carry it.
When regulation is not proportionate to risk, it creates barriers for businesses, innovation and, ultimately, consumers. What does this look like in practice?
For those of you here in Ottawa, you may remember this. In 2016, two young girls set up a lemonade stand. They had the table, the sign, the cups and that spark of childhood excitement that says, “This is the start of something big.” Then the government arrived. They were shut down and told they needed a permit to sell lemonade. Most Canadians saw that moment for what it was: red tape where common sense should have been.
Now, imagine that those same girls add one simple claim: “source of antioxidants for the maintenance of good health”. Those adjustments instantly turn their lemonade into a natural health product, and everything changes.
Despite the myth that natural health products are unregulated, those two little entrepreneurs would be pulled straight into one of the most complicated regulatory systems in the world for a low-risk product. They would be required to obtain a site licence to manufacture, package and label; host a government inspection; comply with good manufacturing practices, including stability and finished product testing and recall procedures; submit evidence demonstrating their claim is supported; follow bilingual labelling requirements; and file adverse reaction reports. Those requirements were put in place after careful consideration by this committee of what was required to safely regulate NHPs.
While all of this is happening, their neighbour south of the border can ship an identical product straight to Canadians with none of the above restrictions I mentioned and little to no government oversight.
When Health Canada told us they wanted to level the playing field with drugs, I had to ask, “Why aren't we levelling the playing field with competitors selling the same products directly to Canadians?” An analysis prepared for CHFA estimates that approximately $450 million in natural health products enters Canada annually through personal importation. The lemonade example makes this easy to picture, because it's often where small business ideas start but shows how easy it is to tip further into red tape.
For the businesses we represent, the costs are real and substantial. An independent analysis prepared for CHFA estimated that recent and proposed regulatory initiatives would add between $120 million and $170 million in annual compliance costs, plus $430 million to $1 billion in one-time implementation costs through 2028. For a small Canadian business, those costs mean difficult choices: whether to launch a product, hire an employee, raise prices or keep a product on the market at all.
Supporting this bill does not mean compromising the health and safety of Canadians. That's why we urge this committee to support Bill C-224 and protect something fundamental: the ability of Canadians to choose how they support their own health with Canadian products.
Thank you.