Industry Committee on Feb. 7th, 2019

[Karen Proud]

I'll use a great example of a regulatory initiative we recently went through whereby we were asked to relabel all of the products in Canada, all of the Consumer Health Products in Canada. The lack of understanding of how we actually package products led to the case now where our companies are having to make completely made-in-Canada solutions on their packaging, which don't exist anywhere else in the world because we can't fit the information on our existing packaging. There's a lack of basic understanding of how decisions are made and the global supply chain, and how it's not just up to the Canadian company to decide that it will change all of its packaging. It doesn't work that way. It's the global companies that make some of those decisions, and as a result, we may not even be able to bring those products to Canada anymore.

It's one of the reasons why at CHP Canada we broke down everything we do in business from research all the way to post-market surveillance. We created these modules, and we invited the Health Canada officials to understand a little bit about how we do things, how decisions are made, how we bring products to market, and what it takes to get a product on the market. When a decision is made to change a product formulation or product packaging, why is it that industry says we need two years or five years to make this change when in the government's mind, it should be really easy: you change your packaging all the time, so why can't you just change this in a year? We have to explain why it is that we can't change things in a year.

That's where I think it's really important that if I'm a regulator and the regulation, for instance, is going to look at labelling of products, I should first be required to understand how products are labelled. We've invited them—and thankfully Health Canada have taken us up on it—to our packaging companies to stand there and see how it works and to get a better understanding, so that when they're working on the details, they're able to understand why we have concerns. Otherwise they're really operating in a vacuum and are not able to understand how their decisions are affecting big business and small businesses.

[The Chair, Liberal, Dan Ruimy]

Thank you.

Mr. Albas, we'll go back to you for five minutes.

[Dan Albas]

Thank you, Mr. Chair.

I'd like to go back to Mr. Masterson. A number of new regulatory provisions are coming out. You mentioned one from Health Canada, in terms of workplace safety, and how that may conflict with provincial matters. Can you explain that just a bit further? What's being proposed?

[Bob Masterson]

Through the chemicals management plan, which has been around since 1999 and really reinforced in 2006, there's broad agreement that the federal government's role is to assess new and existing substances, and identify those that pose unacceptable risks to human health and the environment.

Largely, the federal government will take action in certain areas, but when it comes to the workplace, legislation is regulated by provincial departments of health and labour. It's comprehensive. There's training. There's signage. There's personal protective equipment. They have robust and lengthy sets of occupational exposure limits that are strictly enforced, with auditors and enforcement agents visiting sites all the time.

When we're talking with the federal government, now that they perceive the need for a new role for the federal government in managing those risks, what gaps are you trying to fill? Where's the evidence that those gaps are there? Have the provinces agreed with you? We see a scenario where suddenly not only do we have to meet the requirements of the provinces, but also something from the federal government.

I go back to your earlier question. Can you imagine a year ago, when both Ontario and the federal government were working on the climate change file, and both levels of government put out requirements on how to regulate emissions from coal-generation equipment? The federal government's proposal came out, somewhat out of the blue, about a week after the provincial requirements had been tabled. They didn't line up. In fact, they conflicted with each other. The federal government would prevent you from meeting the provincial requirements.

Have you guys not talked to each other about this? If you're going to do something, and you know the provinces are already doing it, can't you talk to each other? No.

I'm trying to say this again. It's a chronic, daily thing. It's not that any one level of government is right or wrong. It's just that if we're serious in Canada about addressing the issues of regulatory competitiveness, we're in a very different structure from the United States. Roles are often much clearer there. We understand there's vagueness and uncertainty. That encourages us to have much more detailed conversations at the start about the proper roles for different levels of government.

I would say again, the directive on regulation is a very good document, but you will not see the word “provinces”. You will not see the word “jurisdiction” anywhere. There's an assumption from the first stage that the action being proposed is legitimate for the federal government. We would say you need to go back to the very conversations that were had through the program review, which asked one very direct question: Is it a federal role?

[Dan Albas]

I've spoken with a CEO in my province, who has found an identical situation. Again, we're fine with having a process, but who, ultimately, should be responsible for this? I think that's a very important question to ask.

Mr. Lewis, I have to state for the record that I'm against red tape, but when you talk about audits, and the timing of audits, I will say that from speaking to regulators, I know that sometimes they go in because there is an issue, concern or complaint. Even if there is no issue, and these things are mandated over a period of time and a series of checks, it's to make sure that the company doing business in this particular area—and I would say health care is probably one of the most important areas, and a very mature industry—is maintaining paperwork in a proper way, and that a company has all the records it needs to engage meaningfully if something goes wrong.

What do you say to that? Maybe you can give us some more particulars, because I want to make sure that the public interest is maintained.

[Brian Lewis]

We absolutely agree with the idea that a quality audit must be conducted to make sure that patient safety and quality standards are being met. The auditing process has to be efficient, and make sure it exposes what needs to be exposed, and that any issues are dealt with. In this particular case, what we're talking about is two different pathways within Health Canada, or whatever, in terms of the audits. The MDSAP audit, which is very extensive, is conducted, and then out of a different department or division, the MDEL audit comes along, and is doing most of the things that the MDSAP is doing. It's repetitive. That's what doesn't make sense.

[Dan Albas]

Mr. Masterson originally asked whether these people were talking. You're talking about the same department. They're overlapping the same materials.

[Brian Lewis]

Do you want to go into it a little bit more specifically?

[Diana Johnson]

The department that's responsible for the medical device establishment licence is one department, whereas the MDSAP quality audit system is under the medical devices bureau as opposed to the inspectorate, so there are two departments. We're currently working on a proposal to bring to Health Canada to show them how similar these audits are and to see whether there's a way that it can realistically be addressed. We're in the process of putting that together.

[Dan Albas]

It's gobsmacking to me that we have these. I can understand Mr. Masterson's concern between governments, because governments don't always communicate well. With co-operative federalism, we would hope that it wouldn't happen, but within the same Health Canada, that's unconscionable.

[The Chair, Liberal, Dan Ruimy]

Thank you very much.

We're going to move to Ms. Caesar-Chavannes. You have five minutes.

[Celina Caesar-Chavannes, Whitby, Lib.]

Thank you very much, Chair.

Thank you to our witnesses for being here today.

It really is nice, because my past life was working in clinical trials in pharmaceuticals, so it feels good to return to a really nice, comfortable area.

I just want to pick up on Mr. Albas's last point. I think it's rare that we may agree on something, but I tend to want to agree with him on the MDSAP and MDEL frequency of audits and the overlap between them.

How far would you say it is between those two audits? Is it months? Is it days? Is it years between those two audits? What would you say, in the past, in your historical context, has happened?

[Diana Johnson]

The MDSAP audit is a regular audit. People have annual audits as part of the MDSAP program. For the MDEL, depending on whether you're a manufacturer or an importer and distributor, it will be two- to four-year cycles. You have two cycles going, but when the two coincide, and we're within three months, and you're essentially looking at the same elements that are being audited, there's very little difference. It's more the scope of the product that changes.

[Celina Caesar-Chavannes]

Could you give me and the Canadians who are watching a sense of what an audit means? I know what an audit was like when we ran clinical trials. All operations stop. The auditor's in there for days going through everything, and you're just kind of sitting around waiting for them to leave. Is this what happens in your operations?

[Diana Johnson]

It's a bit more active than that. For the MDSAP audit, the inspectors will go out into the warehouse and pull product. They will verify that those products are labelled according to the regulations and manufactured according to the regulations. If it's the actual manufacturer that's being audited, it's very in-depth. It looks at the design history file of the product to make sure that all the changes are appropriately documented, and the appropriate evidence is all part of the file. It's very extensive.

[Celina Caesar-Chavannes]

I have a question for Mr. Goodman and his colleague.

A constituent in Whitby came to me within the last couple months talking about valsartan and that recall.

You talked about equalizing or normalizing the playing field for compliance audits. This is clearly a case where, in another jurisdiction, we have a product that clearly is a carcinogen that has now entered the Canadian market.

Can you explain again why it is so necessary to have that compliance to level the playing field? When you ask for a level playing field, are you asking for an increase of Canadian audits in other jurisdictions, or are you asking for a decrease in the number of audits that happen on this side?

[David Goodman]

We're looking not to decrease what we have. The truth is, it would make life easier if we did have fewer, but that wouldn't, I think, be in the public good. I think we're saying that we think that the amount, the severity and the depth of an audit on an outsider should be the same as it is on an insider in Canada.

This valsartan case is a particular one. There was nobody producing valsartan in Canada at the time. The market had been consolidated to two players, and they made some changes that were overlooked by the Chinese health authorities and by a lot of other people who visited them. It could happen again, but if somebody were to make valsartan in Canada, you would say they should have their process controlled the same way and audited the same way, and they should look at all the other parameters that could cause this type of defect in the product.

[Celina Caesar-Chavannes]

I also want to talk about the submission fees and the case for pediatric submissions. When I think about the exorbitant costs associated with bringing pediatric medications to the Canadian market, I look at the safety and compliance side. The safety for my children in taking their medication—if I could be selfish and talk in that realm—and the compliance should outweigh.... That should be the principal focus.

Are you saying through your testimony that you may feel that's not the principal focus, and that the economics are interfering with looking at the safety and compliance of ensuring that children across Canada have access to the medications that are in the right quantities for them?

[David Goodman]

No, I'm not saying what you're saying.

[Celina Caesar-Chavannes]

Okay.

[David Goodman]

First of all, I think the problem is that.... And this is not coming from us. This is coming from the head of pharmacy of CHU Sainte-Justine. This is coming from pediatricians. This is coming from pharmacists across the country. When they adapt a product and they compound it, it's not the same quality as a product that is made commercially. The quality of the product from a physical perspective is so much greater when it's registered and developed commercially than when it is adapted on an ad hoc basis for a patient, whether it's done in a hospital or it's done in a community pharmacy.

[Celina Caesar-Chavannes]

What I'm saying is that this should be the primary consideration, then.

[David Goodman]

That's right. And what we're saying is that, similar to the incentives, if there is a need for this for the population, Health Canada should look around to see how they can make these things more accessible. Maybe it's to give incentives where, if you do develop it, you have some exclusivity, as we talked about with regard to OTC and new indications. Create the climate. Don't create disincentives. A big part of—

[Celina Caesar-Chavannes]

[Inaudible—Editor] small market.

[David Goodman]

That's correct.

Again, the big issue on this topic is about innovation. You have people coming to you and telling you they have a problem. The mother of invention is knowing that there is a problem and an unmet need. How do we make sure that those unmet needs end up being products that are developed in Canada, which then can be exported elsewhere? We have the capacity to do so, but if we tax and tax all the inventive processes so highly, those products won't be developed in Canada. They'll be developed somewhere else.

For me, that's the real crux of the matter.