Industry Committee on April 16th, 2007

[The Chair, Conservative, James Rajotte]

Ladies and gentlemen, we will start our meeting, which is the 53rd meeting of the Standing Committee on Industry, Science and Technology. Pursuant to Standing Order 108(2), this is the first meeting of our study of Canada's access to medicines regime.

Welcome to everyone.

Before we get to the witnesses, in my best French,

I'd like to welcome Ms. Brunelle, the Member for Trois-Rivières, who is joining this committee following the departure of Mr. Paul Crête.

Thank you.

We will miss Monsieur Crête. He was an excellent member of the committee. We welcome Madame Brunelle. We know she will do an excellent job as well.

We will go right to the orders of the day. We have four departments and five witnesses with us.

First of all, from the Department of Health, we have Mr. David Lee, director, Office of Patented Medicines and Liaison, Therapeutic Products Directorate, Health Products and Food Branch. Welcome, Mr. Lee.

We have two individuals from the Department of Foreign Affairs and International Trade. We have Mr. Douglas George, director, Intellectual Property, Information and Technology Trade Policy Division; secondly, we have Mr. Robert Fry, senior departmental coordinator, Pandemic Preparedness, Human Security and Human Rights Bureau.

The third department we have is the Canadian International Development Agency. We have Mr. Christopher Armstrong, team leader, HIV/AIDS.

From the fourth department, the Department of Industry, we have Mr. Douglas Clark, director, Patent Policy.

We will start with the Department of Industry. We will then go to the Department of Foreign Affairs and International Trade. Then we will go to the Department of Health. Finally, we'll go to CIDA. It's my understanding that this agreement has been worked out.

We'll have a six-minute opening statement from each department. Mr. Clark, we'll start with you.

[Douglas Clark, Director, Patent Policy, Department of Industry]

Thank you very much.

Thank you for inviting us here today.

Some of my colleagues will be allocating a bit of their time to me, if that's okay with committee members.

I want to provide a brief overview of the legislation and how it came to be and what the current status is. I've prepared a PowerPoint presentation that you all should have before you.

[The Chair, Conservative, James Rajotte]

We have 30 minutes in total for presentations, so as long as we don't go over that.

[Douglas Clark]

All right.

I know that for some of you this will be old hat, but I can see some new faces around the table since the last time I was here, so I thought it would be useful to prepare a presentation that just set the foundation for the discussion to follow.

As I am sure you all know, a patent provides an inventor with a time-limited monopoly for his or her invention in order to encourage research and development and to promote the diffusion of knowledge. In Canada and in all other WTO-compliant countries, the term of patent protection is 20 years from the date the patent was filed. In certain circumstances, however, governments can override patent protection provided they do so consistent with certain international obligations. They can authorize a third party to make, use, or sell a patented invention.

Both the WTO and NAFTA prescribe the conditions under which a compulsory licence can be issued and a patentee's rights can be overridden. One of these requirements, formerly anyhow, up until 2003 under the WTO TRIPS agreement, was that if a government is to override a patent and issue a compulsory licence, it has to be predominantly for the supply of the domestic market. This was seen as problematic by WTO members because it prevented developed countries like Canada from issuing compulsory licences to generic drug companies to make generic versions of patented drugs to ship to least developed countries that had no such pharmaceutical manufacturing capacity. It was seen as a barrier.

The requirement for the override to be predominantly for the supply of the domestic market was seen as a barrier to developed countries helping to develop the least developed countries. In August 2003, WTO members agreed to waive that predominantly for the supply of the domestic market requirement, but in so waiving the requirement they did insist on a number of terms and conditions that both the exporting party, the developed country, and the importing party, the developing or least developed country, would have to abide by. And they didn't waive a number of other WTO TRIPS obligations that apply specifically to compulsory licences.

Slide 4 sets out some of the terms and conditions I mentioned. The bullets you see here refer not only to the terms and conditions of the waiver, but they also account, to some extent, for the actual remaining applicable obligations that are in the TRIPS agreement. So only certain countries can import drugs under the terms of the waiver. Least developed countries, least developed WTO members, can import. Developing countries can import but are subject to different conditions in terms of what they have to notify the WTO about when they want to avail themselves of the waiver. I'll get into that in more detail in a moment.

You can see some of the other conditions. The country that wishes to import must identify the drug that it wants to import and the quantity. The licensee must pay remuneration to the patentee. The waiver must be used in good faith and not for commercial or industrial objectives, etc.

That waiver was agreed to in August 2003. Canada was one of the first countries to announce its intention to implement the waiver. It's not a positive obligation. It's up to individual developed country members whether they want to implement it. In May 2005, once the subordinate regulations came into force, the legislation that brought in Canada's access to medicines regime, which amended the Patent Act and the Food and Drugs Act, came into force, that legislation included a statutorily mandated review provision given the unprecedented nature of the initiative. So right now, as you know, the departments that you see before you are in the midst of carrying out that review.

Slide 6 is on guiding principles to facilitate access to medicines in the developing world; to provide sufficient incentives to Canadian generic drug companies that want to participate, which is really a subset of the first objective, while maintaining the integrity of the patent system; and to ensure that drugs that are exported under our regime, the access to medicines regime, are as safe, efficacious, and of as high quality as drugs destined for the Canadian market.

Some of the key features to our regime are set out on pages 7 and 8. As some of you may know, there are pre-approved lists of eligible importing countries under the regime and pre-approved lists of drugs that can be exported to those countries. The countries are categorized according to their development status and whether they are WTO members. The obligations this gives rise to reflect the differing status they have. I'll get to that in a moment.

With respect to third parties, although the waiver is an agreement between countries, third parties, non-governments, may purchase drugs under Canada's regime with the permission of an importing country.

The pre-approved list of drugs that can be exported was initially based on the essential medicines list from the WHO, which is a list of the most cost-effective therapies for priority conditions in a basic health care system. That list has been amended twice since the coming into force of the access to medicines regime.

With respect to the application process, I think we'll probably be talking a lot about the details of that process today. In essence, there are really two steps. The generic drug company that wants a compulsory licence to export will go to the Commissioner of Patents and identify the drug and the version they want to make, i.e., dosage, form, strength, route of administration, etc.; the quantity they want to manufacture and export; the patents that apply to that drug and the patentees that own those patents; the country to which they are going to be exporting the drug; and the purchaser, if it is different from the country.

They indicate all those elements of information, which they can simply fill out on the forms. I can provide examples of the forms if you're interested. That's the information they have to provide. Then there are certain other conditions that have to be met. The Minister of Health has to certify that the drug is safe and efficacious and that it's distinctive from the brand name version of that drug sold in Canada. A copy of the importing country's notice, either to the WTO, in the case of a WTO member, or Canada, in the case of a non-WTO member, must be provided. And then the applicant, the generic company, must make different sorts of declarations, again, depending on the development status of the country they're exporting to.

Since Canada announced its intention to implement back in 2003, seven others have followed suit: Norway, the Netherlands, Switzerland, the EU, India, China, and Korea. There are a lot of similarities. Fundamentally, I think they all attempt to do the same thing. They all have different mechanisms to implement. There's obviously more than one way to skin a cat, but fundamentally they're they same. There are a few notable differences between Canada's regime and some of the regimes in these other countries, although they all require royalties to be paid, a website to give notice to people that a drug is going to be exported under the regime, etc.

None of these regimes has a pre-approved list of drugs for export or countries that can import them. One of the requirements that an applicant must meet--and I should have mentioned this before, but I forgot--before getting the licence is that they have to apply for a voluntary licence with the patentee at least 30 days before applying for a compulsory licence from the commissioner. All the other countries have the same requirement, which reflects an obligation in the TRIPS agreement, article 31(b). Many of these countries waive that voluntary licensing requirement in situations of national emergency or extreme urgency.

Some other countries do not provide for the mandatory health and safety review of drugs destined for export under the regimes. For some, it's mandatory. In Switzerland and in the European Union, for example, it's optional.

I guess the reason we're all here today is that the regime has been in force since May of 2005, but to date no exports have taken place and no drugs have been exported from Canada under its regime. The same is true of the regimes in those seven other countries I just mentioned.

This prompted the Minister of Health, at the 2006 International AIDS Conference, to announce an expedited statutory review of the regime. That review got under way in November with the release of a consultation paper. Interested persons had 60 days in which to submit their comments on the regime. That period is now closed.

If you go to slide 11, we've summarized that very crudely. You'll have occasion in the coming week to get more information on stakeholder positions straight from the source, so I won't go into this in any detail. For the sake of time, I'll skip that slide.

With respect to the status of the statutory review, here we are today looking forward to.... Unfortunately, some of the groups we didn't hear from in the context of the consultation paper were the very parties the regime is intended to serve, i.e. developing and least developed countries. As a matter of fact, the government will be participating in an NGO-organized workshop this week that various developing countries and least developed countries will be attending. We hope to get a better understanding of what systemic barriers they may be facing in trying to avail themselves of our and other countries' implementation of the waiver.

Once we've had an opportunity to get that input and we have the benefit of any new information that arises here, that will be incorporated into the report, which the minister must table upon conclusion of the review, hopefully sometime in the spring.

In the interim, all four departments before you are taking advantage of every opportunity to promote uptake of the regime internationally. I can't tell you how many briefings I've given to different delegations, mostly in Africa. We've also established a website, as a users manual for the regime, and a CD-ROM, which we've distributed to various countries in Africa.

Thanks for your indulgence.

[The Chair, Conservative, James Rajotte]

Thank you very much, Mr. Clark.

Now we'll go to Mr. George from Foreign Affairs.

[Douglas George, Director, Intellectual Property, Information and Technology Trade Policy Division, Department of Foreign Affairs and International Trade]

Thank you, Mr. Chairman.

I will be speaking today on behalf of the Department of Foreign Affairs and International Trade. The department's involvement in Canada's Access to Medicines Regime is in two areas: the first is the World Trade Organization and the second is the foreign relations aspects.

With me to answer any questions relating to foreign policy aspects is my colleague Mr. Fry who works in the Human Security and Human Rights Branch.

Many of the WTO aspects have been covered by my colleague from Industry Canada in his presentation, so I think I'll concentrate on one thing that has happened since the waiver was adopted.

When the waiver was adopted, it was, in essence, perceived as a temporary solution. Some waivers in the WTO can last forever, but it was perceived as a temporary solution. Therefore, the members decided to make a more permanent solution, and on December 6, 2005, the WTO members agreed to transform the August 2003 decision, the waiver, into a permanent amendment.

In essence, this amendment transposes the contents of the waiver without changing the major elements. This amendment will take effect after two-thirds of the WTO members have accepted it. They have until December 1 of this year to do so, but the deadline may be extended if necessary. I should stress that the waiver will remain in force until the amendment comes into effect, so it will be a seamless transition.

Canada strongly welcomed the amendment decision as positively demonstrating how WTO members can work together to respond to the needs of developing and least developed countries. We remain committed to working with other WTO members to ensure its acceptance by the December deadline.

Let me turn now to other programs and initiatives to assist developing countries in dealing with health issues.

Canada is committed to assisting developing countries in dealing with health issues and CAMR is just one of the tools used to achieve this objective. While we are talking today about CAMR, it might be useful for the committee to be aware of the breadth of other programs and initiatives.

I'll summarize these.

At the June 2006 UN high-level meeting on HIV/AIDS, Canada committed, along with other member states, to support efforts to move toward universal access to HIV prevention, care, treatment, and support by the year 2010.

The G-8 has also been a consistent and strong supporter of this goal. At the July 2006 St. Petersburg summit, G-8 leaders recognized that improved access to means of prevention, treatment, and care in many countries is essential to curbing infectious diseases. Leaders also noted the possibility for WTO members to use the flexibility set out in the waiver decision.

In addition, the right to the highest attainable standard of physical and mental health is outlined in numerous UN human rights instruments, including the United Nations Universal Declaration of Human Rights and the International Covenant on Economic, Social and Cultural Rights. While that covenant requires each state party to promote the right to health for its own citizens, there is no interstate obligation to protect the right in other countries, and while all international development assistance, including health-related assistance, is a moral and not a legal obligation, Canada has been a major donor to health-related initiatives in the developing world.

In additional to strong political engagement, Canada also supports a wide range of organizations and activities that help promote global health, many of which address the access to medicines issue. Chris Armstrong, my colleague from CIDA, will give you more details on these shortly in his presentation.

Thank you for the opportunity to address the committee.

[The Chair, Conservative, James Rajotte]

Thank you.

We'll now go to Mr. Lee, from Health Canada.

[David Lee, Director, Office of Patented Medicines and Liaison, Therapeutic Products Directorate, Health Products and Food Branch, Department of Health]

Thank you, Mr. Chair.

I intend to outline very briefly what Health Canada's role is under the CAMR.

We actually do three things. The first is that the department is responsible for undertaking the regulatory review of drug submissions to verify that the product meets the same requirements for safety, efficacy, and quality as drugs available to Canadians. These are primarily generic drug reviews, so we're comparing a brand and a generic drug and making sure they're comparably acceptable.

Second, we are responsible for ensuring that the pharmaceutical product is distinguishable from the patented version available in Canada, and this is expressed in a regulatory requirement. For example, a solid oral dosage form has to be a different primary colour and it has to have a marking on it so you can tell the difference. This is aimed at preventing diversion or reimportation of the product.

Third, we are responsible for performing pre-export inspections to verify, among other things, that the distinguishing features I've just mentioned are actually in place and that the quantities to be exported are accounted for. These details are stated on the manufacturer's application for the compulsory licence that is sent to the Commissioner of Patents. We really have to coordinate with the commissioner, so when we're done our safety review--our quality, efficacy, and safety--we tell the commissioner we're ready go with the drug and we coordinate our inspections around the product moving from Canada to where it's going.

We have had some experience with the first two stages. In other words, we have received generic drug applications under the regime; they've gotten as far as our reviewing them for safety, efficacy, and quality and then basically putting them on our shelves, so they're ready to go from a food and drug regulations point of view. That includes also the distinguishing features. That means they're sitting waiting for the rest of the process to be completed, namely the licensing part with the Commissioner of Patents.

In terms of our submissions, we actually are very content to keep playing our role in terms of looking at the quality, efficacy, and safety of drug products before they go anywhere. In terms of the inspection, I would caution that we haven't had as much experience with that part yet. It's a newer part under the regime, and until product is ready to move under licence, we won't actually have experience built up around that.

It is Health Canada's view that there should be no question of a double standard--in other words, when we do our drug reviews, it's the same review that we do for domestic purposes for a generic drug--and that there should not be any concerns that a drug leaving Canada destined for humanitarian purposes might be unsafe.

Thank you, Mr. Chair, for the opportunity to present.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Lee.

We'll now go to Mr. Armstrong, from CIDA.

[Christopher Armstrong, Team Leader, HIV-AIDS, Canadian International Development Agency]

Thank you very much, Mr. Chair.

I work with CIDA's policy branch as a health and HIV/AIDS adviser. It's a great pleasure to be here. My presentation will actually be quite brief. I'm just going to give you a bit of an overview of the status of health in developing countries, present to you some of the challenges facing developing countries with respect to access to medicines, and give you some examples of what we're trying to do through CIDA in supporting developing countries in the area of health.

As I mentioned, it will be quite brief, but I'm obviously open and willing to answer questions and provide further information if you need it.

In my presentation, I will be speaking to a deck. It's the blue one that I hope everyone has in front of them. On the second slide, “Canada's International Commitments in Health”, my colleague Doug George spoke about some of our international commitments, so I won't repeat what he has already said.

With respect to that, I would draw your attention to the millennium development goals that were adopted in 2000, to which Canada is a party. Essentially, they provide the framework for how we work in development, the goals towards which developing countries are striving and the goals to which we as a donor provide support to them.

With respect to health, four of the eight millennium development goals relate directly to health. One is to reduce child mortality. Another is to improve maternal health. The last one that specifically relates to health is to combat HIV/AIDS, malaria, and other diseases.

The next slide, concerning health in the developing world, is just to give you a sense of some of the issues that face developing countries with respect to health. It by no means paints the full picture of health, but I thought some of these statistics might be compelling to you.

If you look at issues of maternal and child health, which relate directly to the millennium development goals of which I spoke to you before, it is estimated by the UN that 99% of maternal deaths due to pregnancy or childbirth and over 90% of child deaths—which is a staggering 11 million deaths per year—occur in the developing world.

Malaria is another example, which accounts for an estimated 1.2 million deaths per year, and approximately one million of those occur in Africa alone. So you can see where the burden is greatest.

With respect to HIV and AIDS, an area specifically in which I spend a great deal of time working, of the 40 million people living with HIV and AIDS, estimated by UNAIDS, over 90% are in the developing world. There are still an estimated 3 million deaths per year related to HIV and AIDS, and just under 5 million new infections continue to occur around the world. Of the estimated 6.8 million people around the world or particularly in the developing world who could benefit from antiretroviral treatment, 1.6 million are estimated to be currently receiving treatment. That's a huge increase over the last number of years, but it has obviously still not achieved that goal that Doug George spoke about, which is universal access.

The next slide deals with some of the challenges that developing countries face with respect to access to medicines. Again, these are just a few examples. It's a complicated issue to which there are many challenges, but just to give you a sense of some of them, and some of the non-TRIPS-related issues as well, certainly weak health systems continue to confront African countries and other countries in the developing world. As an example, Africa has only 1.3% of the world's human resources for health, yet it carries about 25% of the burden of global disease. If you look at sub-Saharan Africa, it's estimated that only about 30% of the population has access to basic health services.

Some of the more specific issues related to access to medicines, issues of capacity in developing countries around procurement and regulatory issues and supply chain, continue to challenge developing countries. These are all things the development community, including CIDA, is working with developing countries to address.

The second point there is lack of ability to use TRIPS flexibilities. This is related to issues of capacity and legislative frameworks within developing countries themselves, whether or not they have the knowledge of the flexibilities or the people who need to have the specific knowledge as to what's available to them through the TRIPS flexibilities and whether or not the right legislation exists in those countries in the way that we've undertaken in Canada to put in place compulsory licensing provisions in our legislation. Does that exist in those developing countries? In many instances, it doesn't.

The final challenge is the one you often hear about, of course, and that's the funding gap. What are the available resources? Just to give you some estimates and examples, it's estimated that in order to achieve the goal of halving the burden of malaria by 2010, an estimated $3 billion will be needed. Currently, about $600 million is being spent. On HIV/AIDS, if you look at the UN AIDS estimates for 2007, it's estimated that about $18 billion will be required annually. That's for all of HIV/AIDS, and not specific to treatment. It's estimated that between about $8 billion and $10 billion is being provided, both through donors and through developing countries' budgets themselves.

On the next slide is a quick overview of the health priorities at CIDA and how we work with developing countries to improve their health outcomes. These items are categorized into two areas, really. The first area is stepping up our efforts to prevent and control high-burden and poverty-linked diseases like HIV/AIDS, TB, and malaria. We're also working on issues of infant and child health and sexual and reproductive health, including maternal health. Finally, there are the issues of food security and nutrition. And the second area is strengthening health systems. As you remember, I just mentioned that this is a very important issue with respect to access to medicines.

Finally, on the last slide, just to give you a quick overview of what we're doing—and again, this is illustrative, not complete—for the fiscal year 2006-07, which has just come to an end, it's estimated that we will have spent about $822 million specifically on health sector support in the developing world. That's approximately 30% of CIDA's overall sectoral spending.

If we have a few minutes, Mr. Chair, I'd just like to give you some examples of some of the programming we do. I'm sure many of you are aware of the global fund to fight AIDS, TB, and malaria. Canada is a significant donor. I believe we're currently the seventh-largest donor to that fund; we recently announced the provision of $250 million over two years to the global fund. The fund is doing tremendous work in terms of providing access to medicines in the developing world, and it will continue to do so. Canada will continue to participate in it, I'm certain.

We've provided support to the WHO, particularly for its work in access to HIV/AIDS treatments. When I spoke earlier about how 1.6 million people are now accessing treatment, that was in large part due to some of the very good work of the WHO's HIV/AIDS division, to which Canada was a leading donor.

We've announced recently that we will spend, over the next two years, $450 million to invest in African health systems initiatives. We provide support to ministries of health on HIV/AIDS strategies throughout Africa and around the world. Mozambique and Tanzania are two specific examples.

I've provided an example of a small initiative in terms of money, but one that we think is quite important with respect to this particular issue. I won't go into it in detail, because I believe you're hearing from U of T later this week on the access to drugs initiative. It's essentially support that we've provided to U of T to work with the Government of Ghana, to assist it in making use of the TRIPS flexibilities. Some new work that the U of T is doing is also looking at regional approaches to access to medicine.

Finally, the last one is the global TB drug facility, to which Canada was a founding donor and has provided significant funding. To date, it has provided treatment to over 6 million TB patients. Our support to that has been about $90 million to date.

Thank you, Mr. Chair.

[The Chair, Conservative, James Rajotte]

Thank you very much, Mr. Armstrong.

We'll now go to questions from members. For the first round, we have six minutes in total for questions and answers, so I'd just ask members and witnesses to be as brief as possible in their questions and their comments.

We'll start with Mr. Byrne.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Thanks very much, gentlemen, for appearing before us and for some succinct presentations.

I just want to get to the last slide of the deck that you presented to the committee, Mr. Armstrong. You talked about CIDA's support to the health care sector, establishing the fact that $822 million was spent on support to the health care sector last year, representing 30% of CIDA's sectoral spending. You also mentioned that Canada's commitment to the global fund to fight AIDS, TB, and malaria is providing some significant benefits in regard to access to medicines.

Can I ask you a question? Who is the champion of this process in Canada, for an eligible country to access Canadian patented medicines produced by generic producers? Which department is it? Or is it a global fund?

[Christopher Armstrong]

The champion? Do you mean within the Government of Canada? I would suggest that we're all--

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Okay, I'll tell you what. I'll be a little more direct then. An eligible country identifies malaria as a massive health concern and an epidemic is established, a state of emergency declared. Who do they go to, to actually get this whole process in motion? The question here, in the hearts and minds of every legislative member on this Hill, is this. How do we make this system work? The question is, is it broken, or is there something else that's not being done? My question would be quite simply this. Does CIDA interact with an eligible country to make a bulk order of medicines produced by a generic producer for availability in Africa, South America, or elsewhere? Do we do that, yes or no?

[Christopher Armstrong]

Absolutely. It would vary from country to country. We're not obviously involved in the health sector in every country in which CIDA operates. The health sector is certainly one of our major areas, but it's not in every particular country. And that decision is taken based on CIDA's experience in that particular country, on Canadians' experience in a particular country, but also on working with the developing country to determine whether or not that's an area where they're looking for support from CIDA. So on the first part of that question, it would vary from country to country. Where CIDA is actively involved in development countries, absolutely, we're working and participating with ministries of health and other relevant--

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

But we haven't had any success whatsoever because there's not one pill that's been produced by a generic producer.

[Christopher Armstrong]

If you're talking specifically about the medicines having been exported from Canada, then no, to the best of my knowledge, and as presented, not a single pill has gone from Canada. But that's not to say that CIDA isn't working with developing countries in terms of accessing those medicines. We're providing support in the health sector. We're providing support through the global fund, through other initiatives that enable those developing countries to purchase medicines from where they deem it is most appropriate for them to get the most affordable and most efficacious medicines. Now, at the end of the day, if that's Canada, then yes, CIDA is providing support to those countries and they will access that.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

I'm curious here, because you're saying that the real barriers to access to this program are a lack of an ability to use TRIPS flexibilities due to capacity, knowledge, and domestic policy or legislative framework and a funding gap. These are all things that I thought CIDA was supposed to do. Say, for example, an eligible country comes forward and says we have a huge HIV/AIDS epidemic, or we have a malaria epidemic, and we need assistance. Who is the champion in Canada? I just wonder whether or not CIDA is actively engaged in advocacy in Canada.

In this room right now we have a whole lot of government relations specialists for Canadian brand name and generic pharmaceutical companies. I don't think there are very many of the least developed or developing countries that have a whole lot of capacity in Canada to get this whole access regime in motion. Is that CIDA's role? Have you done it, and would you be prepared to apply specific funding envelopes for specific applications, by specific countries, to get this process in motion?

[Christopher Armstrong]

There were a few questions embedded there. They would come to CIDA if they said, we have an HIV/AIDS problem and we want support from Canada. They would come to CIDA. We are the development agency that exists on the ground and we are the ones that would provide funding to do it.

With regard to your latter question as to whether or not CIDA would be in a position to provide direct support, perhaps I can just rephrase your question to understand it better. Are you asking whether CIDA would provide direct support to a country to purchase medicines from Canada?

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

Yes. We do it with other suppliers of our international development assistance program. We favour Canadian companies to provide that assistance.

[Christopher Armstrong]

To be honest, it's not a decision that we've taken, that we would do. It's something we would need to look at carefully with respect to our aid effectiveness principles, our principles of country ownership, allowing the flexibilities of developing countries to access the medicines that are most affordable, most efficacious for them. At the same time, though, we would certainly bring their attention--and have done so on many, many occasions--to the legislation that exists in Canada. We have made them aware that those flexibilities exist in Canada, that our manufacturers do have the ability through this legislation to provide it through compulsory licensing. But it's a question of putting the decision and the country ownership within the hands of the developing country to make those decisions.

[The Chair, Conservative, James Rajotte]

Thank you.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

This seems to be what CIDA does. Eighty-five percent of our development assistance envelope is Canadian companies.

Thanks.

[The Chair, Conservative, James Rajotte]

You'll have another chance, Mr. Byrne. Thank you, Mr. Byrne.

Thank you, Mr. Armstrong.

We'll go to Madame Brunelle.

[Paule Brunelle, Bloc, Trois-Rivières, QC]

Good day and thank you for joining us.

Good day, Mr. Clark. This framework legislation was enacted in 2004, but there is still no pharmaceutical manufacturing capacity in developing countries. I'm trying to understand the reasons for this state of affairs. Regarding the WTO's terms and conditions for waiving certain obligations, you note the following in your document: “Licensees must pay adequate remuneration to the patentee(s)”.

What exactly do you mean by that? Is this the sticking point?

You go on to say this: “Waiver must be used in “good faith” and not for commercial or industrial objectives.”

Can you tell us what you mean by “adequate remuneration”? I'd also like to know if it is easy to obtain a waiver in good faith?