International Trade Committee on May 31st, 2016

[The Chair, Liberal, Mark Eyking]

Good morning, everyone, and welcome back, MPs, from your week in the riding.

As everybody knows, we are the committee for international trade and are a very active committee. We have quite a few things on our plate and we're going to continue. We're dealing with finishing up the European agreement and we have softwood lumber, but right now our focus is on the TPP, the Trans-Pacific Partnership agreement. Our committee has been travelling right across the country. We already did the western provinces, Ontario, and Quebec. In the fall, we'll be doing Atlantic provinces and the territories.

We have had many witnesses. We had open mike submissions at many of the meetings throughout Canada, and we're taking submissions up to the end of June from any individuals. For any MPs who do town hall meetings, we're going to take their submissions up to the end of July. We've also had many people representing companies, organizations, and stakeholders. This is a major agreement, as many of you around this table know, and it's going to affect every Canadian one way or another, whether you're a consumer or a supplier.

Today, our main theme is the health care system. We have many representatives here from various sectors of the health care system.

We're doing this a little differently today. Around June, things get a little active around Ottawa. Well, they're always active, but around June things get a little unpredictable. What we're going to be doing now in our committee meetings is having all the witnesses do their presentations, and then we'll have a dialogue with MPs as long as we can. I feel that this is better, because our main objective in our committee is to listen and to hear what Canadians and people involved in the different sectors have to say.

If something happens, we may adjourn. As members of the House, if we have to go into the House, we will, but it doesn't look like there's anything that's going to interrupt us this morning.

Without further ado, we have six witnesses, and we have somebody all the way from Norway.

Can you hear me in Norway, Mr. Labonté? I'll start with you.

[Ronald Labonté, Professor and Canada Research Chair in Globalization and Health Equity, University of Ottawa, Canada Research Chairs Program]

Yes, I can, thanks, very clearly.

[The Chair, Liberal, Mark Eyking]

Before you start, we're asking each witness to keep it around five minutes. We'd appreciate it. If it's a little shorter, that's fine, or a little over, but get your point across, and then we'll have a lot of dialogue with the MPs as we go forward.

Go ahead, sir. Welcome.

[Ronald Labonté]

Thank you very much and thanks for the opportunity to address you from the rather lovely city of Trondheim, Norway.

I direct the globalization and health equity research unit at the University of Ottawa. We recently completed a two-year health impact assessment of the Trans-Pacific Partnership agreement. I'm going to speak to a few of our findings.

First, the TPP's impact on the cost of pharmaceuticals has received considerable attention. I know the committee has already heard from Dr. Joel Lexchin, whose earlier work on CETA's patent term extensions estimated the drug costs in Canada by 2023 could rise by between $2 billion and $3 billion, without guaranteeing any therapeutic gains.

The TPP locks in these provisions while also loosening requirements for evergreening of patents. It's important to put this into the context that meanwhile, a UN high-level panel is calling for new models for the development of health technologies and drugs that go beyond patent regimes to better balance trade and industry interests with human rights and public health concerns. So increasing pharmaceutical patent provisions appears to be somewhat out of step with these other multilateral discussions on ensuring access to life-saving drugs.

Second, although the TPP does not significantly change the single-payer model of the Canadian health care system, there are new risks. Canada already liberalized private health insurance under the GATS and under NAFTA, so should Canada extend public health insurance monopoly into areas where foreign-invested private insurance has interests, this could trigger a dispute. The TPP adds to this risk by extending investor-state rules to a much larger number of foreign investors and exposes claims over private health insurance to the rather controversial FET provisions in ISDS, which are not part of NAFTA, at least not part of NAFTA's financial services chapter.

Investor health insurance related claims against other countries have actually already occurred and succeeded under bilateral investment treaties with similar provisions to those in the TPP. While it's true that Canada's annex II social services reservation could offer protection against such an investor suit, this would very much depend on the tribunal's interpretation of that reservation.

Third, and an important public health gain, is that the TPP does allow a voluntary exclusion from investor-state claims against tobacco control measures. This exclusion does not apply to state-to-state disputes that could arise following pressure from tobacco interests within TPP member nations, nor does it prevent tobacco transnationals from using other investment treaties, such as NAFTA, to launch investor-state claims against Canada over new tobacco control measures, which could include Canada's commitment to plain packaging.

The exclusion nonetheless importantly signals that TPP governments were concerned with the potential impact of ISDS provisions on public health regulations, which really begs for us the larger question: Why was this exclusion not extended to all non-discriminatory public health measures a country might adopt, especially given the impact of other globally traded health-harmful products, such as ultra-processed foods and alcohol?

Fourth, the TPP creates new barriers to regulate these health-harmful commodities. New provisions in its SPS and TBT chapters could weaken use of the public health precautionary principle, which is applied when there is insufficient evidence for a scientific consensus on health risks, and at the same time require TPP parties to ensure that any new regulatory standards do not create unnecessary obstacles to international trade. These provisions could strengthen trade interests over efforts to regulate for consumer, public, and environmental health. The TPP also creates avenues for vested corporate interests to influence the development of such standards.

TPP governments have responded to some of these concerns by pointing to the TPP's health exceptions. These include the use of the WTO's GATT article XX(b), which allows governments to enact measures necessary to protect human health, amongst others, that are not judged to be unjustifiable discrimination between countries. This is an important exception, but so far, it has only been successful in one of 43 cases, with most of the cases failing on the necessity test, meaning that dispute panellists believe there were less necessary options in terms of trade that could have been pursued.

The general exception in the ISDS chapter similarly allows parties to adopt measures to achieve environmental health or other regulatory objectives, but quickly adds that this is only if these are otherwise consistent within the chapter.

[The Chair, Liberal, Mark Eyking]

Sir, I'm sorry. Could you make some concluding remarks, please.

[Ronald Labonté]

Sure.

Generally speaking, we don't believe there is sufficient protection for public health regulation now and into the future existing within the TPP, and neither do we find any evidence of some of the health-enhancing or health-promoting opportunities related to economic growth, jobs, or employment. None of the economic studies we have seen actually indicate that those gains, if any, would be substantial.

It's hard to see how the TPP represents any health benefits. We believe it also poses significant health risks.

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you, sir.

We'll move now to Innovative Medicines Canada. We have with us Declan Hamill and Mark Fleming.

Go ahead, for five minutes.

[Declan Hamill, Chief of Staff and Vice President, Legal Affairs, Innovative Medicines Canada]

Thank you.

Mr. Chairman, I'm pleased to be here today as part of the trade committee's consultation on the Trans-Pacific Partnership agreement.

With me is my colleague Mark Fleming from Janssen Pharmaceutical Companies of Johnson & Johnson.

Innovative Medicines Canada is the national organization representing innovative pharmaceutical companies in Canada. We are dedicated to enhancing the well-being of Canadians through the discovery and development of new medications and vaccines. Together, we invest over $1 billion in research and development annually, fuelling Canada’s knowledge-based economy.

We'd like to briefly address a number of what we believe are misconceptions about how the provisions of TPP will impact Canadian pharmaceutical innovation, Canadian patients, and the costs to health care in Canada.

The first claim is that TPP somehow represents a significant increase in Canadian life sciences intellectual property protections.

Mr. Chair, in Canada's technical summary of negotiated outcomes of the TPP, the federal government concludes that on pharmaceuticals, TPP outcomes are, “In line with outcomes secured in the Canada-EU Comprehensive Trade and Economic Agreement (CETA)”. In other words, TPP breaks no materially new ground in extending IP protection in life sciences beyond what was negotiated in CETA.

The second claim that's often heard is that TPP will extend the life of patents in Canada.

Mr. Chair, under TPP, patent terms will remain at the international standard of 20 years. What will happen is that innovative companies will have an opportunity to potentially recover some of the time lost on their patents as a result of lengthy clinical trials and regulatory approval process delays.

The third claim is that TPP will increase the cost of Canadian medicines.

Mr. Chair, IP protection does not drive the cost of new medicines and vaccines. Besides, nothing in the TPP will prevent Canadian federal, provincial, and territorial governments from doing exactly what they do now, which is to set pharmaceutical prices through the PMPRB and other federal, provincial, and territorial price-setting mechanisms.

[Mark Fleming, Director, Federal Affairs and Health Policy at Janssen Inc., Innovative Medicines Canada]

The fourth claim made by TPP critics is that the Canadian system already provides sufficient intellectual property supports for life sciences competition and innovation.

Mr. Chair, in the life sciences context, patents and data protection act as incentives for biopharmaceutical companies to make enormous R and D investments necessary for new innovative medicines. New medicines cost on average $2 billion to develop, and take 10 to 15 years through the regulatory research and development pathways, yet Canada affords less IP protection than its G7 counterparts and many other industrialized countries provide.

The intellectual property provisions agreed upon through the CETA negotiations between Canada and Europe do take very positive steps in helping to level the playing field between Canada and the EU and other developed countries around the world. For example, since the first announcement of CETA in 2013, my company, Janssen, has committed $1 billion in life sciences investment to Canada.

The IP provisions in CETA were not the only impetus for this investment, but they were certainly a critical catalyst toward enabling us to put Canada on the global investment radar screen of our company. Included in these investments are some living examples, such as the recently launched, on May 11, JLABS @ Toronto, which will house up to 50 Canadian life sciences innovators, removing the financial barriers that start-ups face in making their discoveries and helping them to do what they do best: discover, invent, and create life-saving technologies.

But to reiterate, that's CETA, and this panel is exploring TPP. We believe TPP will have little, if any, impact on Canada in regard to pharmaceutical IP, and is largely in line with what this country already has in place and what is already agreed to in the CETA text.

We would draw the committee's attention to a recent article by my colleague Mr. Hamill that Mr. Barry Sookman tabled in his appearance before this committee a few weeks ago. It provides a more fulsome analysis of the basic provisions of CETA, TPP, and the various IP provisions of Canada and its major trading partners.

To sum up, Mr. Chair, as a matter of principle our association supports international trade agreements that help build Canada's economy. As Canada grows, we will continue to invest, continue to innovate, and ensure that patients have access to life-saving and life-improving medicines.

Thank you very much. Merci.

[The Chair, Liberal, Mark Eyking]

Thank you, gentlemen.

We're going to move over to the Canadian Nurses Association. We have with us Carolyn Pullen.

Go ahead.

[Dr. Carolyn Pullen, Director, Policy, Advocacy and Strategy, Canadian Nurses Association]

Thank you for this opportunity.

I'm a registered nurse and one of 139,000 members of the Canadian Nurses Association.

By now the committee is well versed on the arguments for and against Canada's ratification of the TPP. Today I highlight the reasons the CNA recommends against ratification, reinforcing some concerns that have been raised previously by others and highlighting considerations specific to the nursing profession in Canada. The CNA advocates for Canada's publicly funded health system. We maintain that ours is the best model for promoting the health of all Canadians and providing universal access to high-quality care, regardless of ability to pay.

The economic impacts of the TPP for Canada have been estimated to be relatively small, potentially as low as 0.1% of GDP by 2035. While there may be benefits for some sectors, the deal has potentially serious implications for how health systems are governed, posing threats to the evolution of Canada's health system and affecting all Canadians.

The CNA has the following four concerns:

First, under TPP the cost of drugs would increase, and implementing a national prescription drug program, a program most Canadians support, would be less feasible. Through extending drug patents, delaying the availability of less expensive generic medicines, by 2023 Canada would see an annual cost increase of up to $636 million, or 5% of the annual cost of patented drugs in Canada. There would be a concurrent negative effect on global health due to the unaffordability of these life-saving medicines.

Second, through the TPP investor protections and investor-state dispute settlement, ISDS, mechanism, privatized health services would effectively be locked in, and future expansion of Canada's public health insurance would be impeded. Of particular concern is the potential for the ISDS to interfere with expansion of public health insurance to areas currently insured by private providers. Pharmacare is one example.

Third, the TPP would pose challenges to Canada's ability to regulate health services. The TPP section on cross-border trade in services includes reservations for health services but fails to exclude ancillary services, such as food, cleaning, maintenance, computer and data management, hospital administration, and other critical supports. Where such services are privatized, attempts to re-regulate or to return them to the public sector could be exposed to legal challenges under the TPP.

Specific to the nursing profession, as of 2015 the new entry to practice registration exam for nurses is the American NCLEX RN exam, a product of the National Council of State Boards of Nursing, or NCSBN, a U.S. private organization. Consequently, measures regulating the testing and training services provided by this U.S. vendor would fall outside the scope of the annex II reservation.

There are a number of serious concerns with this exam, including poor translation of the French exam, a paucity of preparatory materials for francophone students, lack of alignment between the exam and competencies required for nursing in the Canadian health care system, and a negative impact on the numbers of eligible graduates entering the workforce.

If provincial governments or the regulatory bodies move to address these concerns, complaints by NCSBN could result in a government-to-government or investor-state dispute under TPP. To avoid this costly scenario, the problems with the NCLEX may remain unaddressed, leaving the development of Canada's largest health workforce, nursing, subject to policy lock-in and regulatory chill, as has been raised previously with the committee.

Finally, the TPP would impede expansion of the public health system to include programs such as pharmacare. The transparency annex gives new rights to brand-name companies to contest the decisions of public drug agencies, tilting toward market-based pricing and increasing costs to governments.

The annex explicitly states that Canada “does not currently operate a national healthcare programme within the scope of this Annex”. Consequently, if Canada developed a future national health care program covering drug pricing and reimbursement, it would come under pressure to comply with the transparency annex. This chapter would prevent the federal government, the fifth largest health services provider in Canada, from getting the best therapeutic value for taxpayers' money. The transparency annex could also hamper Ottawa's future ability to co-operate effectively with provincial and territorial governments in joint measures, such as a national formulary, to make drugs more affordable.

It is for these reasons that the CNA calls for the federal government not to ratify the TPP.

Thank you for your time today.

[The Chair, Liberal, Mark Eyking]

Thank you.

Now we're going to move over to the Canadian Generic Pharmaceutical Association. With us today we have Jim Keon and Jody Cox.

Go ahead, folks.

[Jim Keon, President, Canadian Generic Pharmaceutical Association]

Mr. Chair, on behalf of the Canadian Generic Pharmaceutical Association and our member companies, I'd like to thank you and the other honourable members for this opportunity to participate in the study of the TPP.

As you mentioned, I'm joined today by Jody Cox. She's our vice-president of federal and international affairs. Jody was very active in attending TPP rounds and representing the views of our industry in Canada and internationally.

Our generic pharmaceutical companies directly employ more than 10,000 Canadians in highly skilled research, development, and manufacturing positions. We operate the largest life sciences companies in both Ontario and Quebec. We are Canada's primary drug manufacturers and exporters, and are among the top R and D spenders across all industrial sectors.

The generic pharmaceutical industry is a strong supporter of free and open trade. We export high-quality made-in-Canada generic medicines to more than 115 countries. We also procure raw materials and other inputs from around the world.

Our industry provides tremendous value to the Canadian health care system. Generic medicines are dispensed to fill 69% of prescriptions—basically seven out of 10 prescriptions in Canada are filled by generics—but account for only 22% of the $25 billion Canadians spend annually on prescription drugs.

I want to say a few words about pharmaceutical IP and trade before talking specifically about the TPP. We know your committee is studying the TPP. The pharmaceutical IP provisions need to be considered, however, in a broader context.

First, it is important to recognize that Canada had strong intellectual property protection for pharmaceuticals before either the CETA or the TPP negotiations. When the CETA negotiations were under way, the average length of market monopoly protection for brand-name drugs in Canada was estimated to be six months longer than in the U.S.

The second context point I'd like to make is that the pharmaceutical outcomes in CETA were concessions made by the Government of Canada to get the deal done. These were demands made by the Europeans on behalf of brand-name pharmaceutical companies that have their headquarters in Europe. They were not done to spur innovation in Canada. They were done to get the CETA deal finished. Research into new drugs is done as part of global development programs. Decisions about where to site R and D have little or nothing to do with intellectual property, as a large number of originator R and D investments in India and China help to underscore. An educated workforce, low business costs, and other factors drive these decisions.

The third context point I'd like to make is that major changes to Canada's IP system for pharmaceuticals are going to be required to ratify the trade agreements. The changes will have significant cost implications for the Canadian health care system. I'm not going to get into the numbers today, but the specific costs will depend on the way it's implemented.

I would note as well that you had before you an assistant deputy minister at Health Canada who spoke to the question of increased costs. Actually, it was not this committee; it was the health committee. She spoke to the impact of CETA on health care costs. The PMPRB controls the price of patented medicines, but if you can't buy a generic medicine at a fifth of the price, clearly costs are going to go up. As we extend patents, costs will go up.

New IP measures will also have an impact on Canadian generic pharmaceutical companies. Our companies are part of global supply chains and are active in competition to bring investments and jobs to Canada. In order to operate in this environment, companies need to be able to access export markets for new generic medicine as soon as they open up to competition. Being late to the game generally means a permanent lost potential market share that can never be recovered.

Generic pharmaceutical companies must navigate the domestic pharmaceutical intellectual property system in order to manufacture both its domestic and its export markets. We will lose out on investment in Canada if the legislation is not kept at a competitive pro-trade level.

I will say a couple of words on the TPP outcomes. Overall, the TPP text for pharmaceuticals is about increasing intellectual property beyond the existing levels in the TRIPS agreement administered by the World Trade Organization. Despite that, the final TPP outcome that was negotiated by Canadian officials on pharmaceutical IP is intended to be consistent with the extra commitments that Canada had already made under CETA.

Under CETA and the TPP, Canada has agreed for the first time to extend the term of pharmaceutical patents, ostensibly to take into account the time brand-name drugs spend in the regulatory approval process. It is important to note that the extension is to be capped at two years.

[The Chair, Liberal, Mark Eyking]

Could you make some conclusions. Thank you.

[Jim Keon]

Yes.

Another important aspect is that there will be an export provision allowed in the TPP during the extension period.

I think one of the things we would say is that how the implementation of the TPP is done will be critically important, and Minister Bains' department, the Department of Innovation, Science and Economic Development, will be critically important.

The last point I would make is that the TPP and CETA do extend patents for pharmaceuticals and will have costs and some implications for the generic pharmaceutical industry.

[The Chair, Liberal, Mark Eyking]

Thank you.

We'll move over to CropLife Canada and hear from Dennis Prouse. Go ahead, sir. You're no stranger to the committee room. It's good to see you.

[Dennis Prouse, Vice-President, Government Affairs, CropLife Canada]

Thank you, Mr. Chair.

I appreciate the committee having me here today. I know I'm a bit of an outlier from your theme in that I'm with agriculture with, I guess, a bit of a connector back with biotechnology, but I appreciate your generosity in having me here today.

CropLife Canada is the trade association representing manufacturers, developers, and distributors of plant science innovations, including pest control products and plant biotechnology for use in agriculture, urban, and public health settings. We're committed to protecting human health and the environment and believe in providing a safe, abundant food supply for Canadians. We believe in driving innovation through continuous research.

CropLife Canada is a member of CropLife International, a global federation representing the plant sciences industry in 91 countries. Our mission is to enable the plant sciences industry to bring the benefits of this technology to farmers and to the public. Those benefits manifest themselves in many different forms, including sustainability, driving agricultural exports, job creation, strengthening the rural economy, and increased tax revenue for governments.

Canada is a trading nation and in no other sector is that more true than in agriculture. Canada enjoyed a surplus of close to $12 billion in agrifood trade in 2015. This is very positive not only for the Canadian economy, obviously, but for Canada in the leadership role we can play in feeding a growing world population.

This surplus is made possible by two broad policy pillars. First, it's supported by a science-based regulatory system that allows farmers to stay modern and competitive. It provides a stable, predictable regulatory framework based on sound science rather than politics, at least at the federal level, and it ensures that our farmers have access to the innovative tools of modern agriculture they need to be sustainable and productive.

The second pillar of Canadian agricultural success is international trade agreements that secure market access for Canadian products. CropLife Canada and its member companies are strong supporters of both the CETA, the agreement with the European Union, and the Trans-Pacific Partnership being discussed today. These two initiatives hold the promise of access to robust, prosperous, and growing markets for Canadian agricultural products.

TPP member countries represent over 65% of Canada's agrifood exports. Guaranteeing access to these markets is vital, given that Asia will represent two-thirds of the world's middle class by 2030 and half of global GDP by 2050. Put plainly, Canada's future competitiveness depends on agreements like the TPP.

Eliminating tariffs is obviously a very desired outcome. One issue I do wish to stress with the committee today, however, is that of non-tariff trade barriers. This is an issue of deep concern both to our members and their customers, Canada's farmers. Many agricultural exports face a daunting number of non-tariff trade barriers, such as trading rules on biotechnology, sanitary, and phytosanitary products. Rules on low-level presence of biotech crops and non-biotech shipments are an example of the former, and rules on maximum residue limits of pesticides on fruits and vegetables and all exported commodities would be an example of the latter.

In both instances we've seen arbitrary non-science based rules imposed by other nations act as a proxy for tariffs in preventing imports. As other witnesses before this committee have noted, the fall of tariffs around the world are often quickly accompanied by a rise in non-tariff trade barriers. In addition, there are cases where non-tariff trade barriers are not deliberate. There are many countries that clearly have no defined mechanism to establish an import maximum residue limit, or their process is not harmonized with Canada in terms of science or process.

It illustrates the need for both transparency and a rigorous dispute settlement mechanism in any trade agreement, one based on sound peer-reviewed science. Fortunately, the TPP has some clear wins on the issue of science-based regulation to accompany the tariff reductions. Transparency in decision-making is built into the agreement, as is a dispute settlement mechanism that has science-based regulation as a key component. The TPP will also specifically address the issue of low-level presence in shipments. This makes the science-based regulatory provisions of TPP significantly superior to those found in CETA.

Should we move forward on the TPP, it will be incumbent on Canada and all other nations with a science-based regulatory system to be vigilant on this issue and further clarifications in negotiations.

As you can see, Mr. Chair, our members are strong free traders. We know that trade and innovation are the two key pillars to growth and prosperity in Canada and that the TPP supports both of these pillars. The GrowCanada partnership, which represents all of Canada's major grower groups and of which we are a proud member, sees export growth as a key to prosperity for Canadian farmers, which is why you will see strong support for the TPP among every major grower group in Canada.

Across Canada nine out of every 10 farms are dependent on exports. This represents 210,000 farms, and includes the majority of farms in every province. Canada's food processing sector employs a further 290,000 Canadians.

To conclude, Mr. Chair, we see that the TPP is a tremendous step forward, and it's a statement of confidence in the future of Canadian agriculture. We would urge the Government of Canada to ratify the TPP and show leadership in encouraging other countries to do the same.

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you, sir.

We're going to move on to the Canadian HIV/AIDS Legal Network. We have with us Mr. Richard Elliott. Go ahead, sir.

[Richard Elliott, Executive Director, Canadian HIV/AIDS Legal Network]

Thank you, Mr. Chair.

Thank you to the committee for the invitation to appear.

I am the head of an organization that works for the human rights of people living with HIV and of communities particularly affected by HIV, both in Canada and internationally.

We are also a member of a larger coalition of organizations that are concerned about access to medicines. A copy of the submission that has been distributed to you, I believe, includes the names of a number of organizations that have shared those concerns with you.

Last, I should mention that I am a member of the expert advisory group to the UN Secretary-General's High-Level Panel on Access to Medicines, which was mentioned by Professor Labonté before, although obviously I don't appear on behalf of that panel today.

We have a number of serious concerns with the TPP, and I want to focus on two aspects of the TPP in particular: the chapter on intellectual property, and the chapter on investment, both of which have already been mentioned. Our concerns are also about both the domestic impact and the international impact of this agreement, which has been quite properly characterized as TRIPS-plus, that is, exceeding the provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights of the World Trade Organization.

On the domestic front, the provisions in both the IP chapter and in the investment chapter will lock in, and in some cases make even more restrictive, the IP rules that already exist in Canada which will further delay access to lower cost medicines. Very importantly, as you've heard from the CNA and from Professor Labonté, this will chill regulatory innovation for public health, including in particular, the potential for expanding our public health insurance to include a national pharmacare program with some form of price regulation, something that has been recommended for decades in Canada by many different parties, and by many different commissions and studies, and yet hasn't moved forward.

The TPP will actually make that more difficult, and the longer we don't have a domestic pharmacare program and take advantage of our ability to regulate in the public interest, the longer we'll continue to have inequitable access to medicines in Canada.

If the impact on Canada and Canadians is important, it's even more significant for developing countries that aren't fortunate to have the same resources that a high-income country like Canada has. For countries in the global south, the TPP member states that are low- or middle-income countries will in fact have to adopt significant new restrictive measures related to intellectual property that will have a negative consequence on access to affordable medicines.

Given that the TPP has been presented as a template for future trade agreements, this can't be ignored. It's not simply the handful of low- and middle-income countries that will be most immediately affected by the TPP in this way, but it's also the pressure that will then arise on other countries similarly situated in the future in other trade negotiations. There has been no secret made of the fact that this is the plan for the TPP.

I want to remind us, as a matter of context, that 15 years ago all the member states of the WTO, including Canada, adopted a declaration that was aimed at preserving the flexibility that countries have in shaping their public policy in order to improve access to affordable medicines for all, including a number of measures that, in some cases, will be made more difficult by the TPP.

It's a bit strange that when you have a declaration that has been adopted by Canada and all the other WTO members, against the backdrop of a global AIDS crisis and millions of people dying of AIDS and of other illnesses in developing countries, where we say that we'll preserve the policy space and the flexibility that countries have, but then at the same time we negotiate other trade agreements that will chip away at that policy space and that ability to regulate in the public interest, that doesn't seem like acting in particularly good faith.

I should also note that Canada, of course, is a significant contributor of funds to global health initiatives, including through the Global Fund to fight AIDS, TB, and Malaria. In fact, Canada will be hosting the next replenishment conference of the Global Fund later this year. We should stop to think about the Canadian taxpayer dollars that are being contributed to such an important, health-financing mechanism that has saved millions and millions of lives around the world, but whose ability to save those lives will be impeded when the prices of medicines are actually kept unaffordable. If we're going to contribute money to try to save lives by making medicines affordable, let's not at the same time chill the ability of countries to actually control the prices of those medicines. In doing so, we limit the effectiveness of our foreign aid.

Specifically with respect to the two major areas of concern regarding access to medicines in the TPP, the first is the question of the provisions on intellectual property, in the intellectual property chapter of the TPP, and in particular—

[The Chair, Liberal, Mark Eyking]

Sir, try to make some conclusions. I'll give you another half a minute, if you can do it.

Go ahead, sir.

[Richard Elliott]

—the extension of patent terms beyond what already exists, which will apply in both Canadian and other TPP member states; the locking in of our linkage regulations that tie marketing approval of generics to claims of patent infringement by brand-name companies; and provision that the Supreme Court of Canada has already declared to be draconian would be locked in by the TPP, locking in data and market exclusivity provisions, and so on. Those will all have a negative impact on Canadians' access to medicines and also those of people in developing countries.

You've already heard about the regulatory chill that will be created by the investment chapter, the provisions of which now explicitly for the first time apply to IP provisions. Canada should take particular note of the fact that Canada is the subject of the first investor-state dispute settlement provision by a pharmaceutical company under NAFTA. We are now taking those provisions and globalizing them further through the TPP.

Instead of going down this route, we could take a number of positive approaches. I'll wrap up with a couple of suggestions.

The High-Level Panel on Access to Medicines that the UN Secretary-General has struck is looking at how to come up with better policy approaches for both more innovation and better access, rather than the skewed innovation and limited access we have now. We could instead be active participants in negotiating a global health R and D treaty that would address public health needs of the world, and we could instead be negotiating treaties that guarantee policy space for countries to protect public health, as we said 15 years ago we were hoping to do.

Thank you.

[The Chair, Liberal, Mark Eyking]

Thank you.

Before we open up the dialogue with the MPs, I'd like to recognize Mr. Ruckert. You're a colleague from the University of Ottawa with Mr. Labonté. It's good to see you here. You're also available to take any questions from us.

It's also good to see my old buddy Mr. Shipley here.

[Bev Shipley, Conservative, Lambton—Kent—Middlesex, ON]

Mr. Chair, yes.

[The Chair, Liberal, Mark Eyking]

He taught me all. He was my former chair, so any bad habits I have came from him.

[Some hon. members]

Oh, oh!