Debates of May 7th, 2001

Questions On The Order Paper

[The Speaker]

Is that agreed?

[Some hon. members]

Agreed.

Patent Act

[Brian Tobin, Liberal, Minister of Industry]

moved that Bill S-17, an act to amend the Patent Act, be read the second time and referred to a committee.

Mr. Speaker, I am pleased to rise in my place to begin second reading of Bill S-17, an act to amend the Patent Act. The amendments contained in the bill are simple. They are straightforward. They have one purpose and one purpose only, and that is to bring Canada's Patent Act into compliance with two separate rulings of the World Trade Organization, the WTO. They maintain the balance that has been struck in Canada's patent regime.

One of the rulings dealt with a dispute with the United States. The U.S. argued that certain old act patents, that is, pre-1989 patents, do not benefit from a minimum 20 year term of protection from the date they were filed as required by the agreement on trade related aspects of intellectual property rights, known as the TRIPS agreement. In September 2000, the WTO body sided with the U.S. interpretation of the dispute and ruled that Canada's patent terms for certain old act patents were inconsistent with obligations under the TRIPS agreement.

Bill S-17 complies with the ruling by establishing the term of protection for outstanding old act patents as the greater of 17 years from the date the application was granted or a minimum of 20 years from the date the application was filed in Canada as defined by the patent rules.

Canada already provides a TRIPS compliant term of 20 years from the date of filing for patents granted under the new act regime. The new act regime has been in effect in Canada since October 1, 1989.

The second WTO ruling addressed by Bill S-17 is a dispute with the European Union. In the second dispute the WTO ruled in March 2000 that Canada's stockpiling exception was inconsistent with the TRIPS agreement. This exception allowed generic drug manufacturers to make and to stockpile their version of a patented product during the last six months of the patent term.

It is important to recall that as part of the same ruling, the WTO confirmed the consistency of our early working exception, a fundamental component of our patent regime. The early working exception allows third parties to use a patent invention during its term of protection for purposes of regulatory approval.

The government has already complied with the WTO ruling on stockpiling, by way of regulation. The repeal of the stockpiling provisions simply ensures that the Patent Act itself conforms with our TRIPS obligations.

The bill before us today deals exclusively with the issues of patent term and stockpiling. It does not attempt to go into the broader aspects of patent protection in Canada.

As I said when I appeared before the Standing Committee on Industry, there will be other opportunities to have a broader consideration of our intellectual property laws, but it is very important that we proceed expeditiously with the amendments before us because the WTO has imposed a deadline for compliance with the patent term ruling. Canada has until August 12, 2001 to comply. Otherwise we could face retaliatory trade action.

The amendments contained in Bill S-17 would provide extensions to certain old act patents that are still in force and that do not benefit from a minimum patent term of 20 years from the date the patent application was filed. I should point out that there are, relatively speaking, a small number of patents that will be affected by this amendment.

As of January 1, 2001, there were 138,800 outstanding old act patents. Of these, 53,500 had patent terms of less than 20 years from the date of filing. It is important to note that not all of these patents have commercial value. The vast majority do not. To date, only the pharmaceutical industry has identified commercially significant patents that would be affected by this ruling.

I would also emphasize that not all the old act patents are affected by the WTO ruling on patent term. Of the 138,800 outstanding old act patents to which I referred, 85,300 of them have terms of greater than 20 years from the date of filing. These patents are unaffected by the present amendments, as are all patents currently being granted.

Because some have expressed concern about how a change in the term of patent protection will affect drug costs, let me go into this issue in greater detail. We estimate that the number of commercially significant drugs that would benefit from a patent term extension is 30. Of the tens of thousands out there, 30 would benefit. The number of affected drugs is relatively insignificant when compared to the 5,200 patented and non-patented prescription drugs available to Canadians. The average term extension for the patents on the 30 drugs is about 6 months. The maximum amount of lost savings resulting from these patent term extensions has been estimated at less than one-tenth of 1% of drug sales over the eight year period during which the affected old act patents expire.

These foregone savings can be this great only if two things actually happen, the first being that every one of them is copied by a generic manufacturer. This is not likely to happen because not every drug has enough of a market to warrant a generic copy. However, let us assume for the sake of argument that a generic copy is in fact produced. Second, let us assume that the generic copy would capture the entire market for this product immediately after its entry. Again, this is very unlikely.

However, let us make our estimate based on these two extreme scenarios. It gives us the worst case scenario. This is the absolute maximum that these amendments would cost our health care system: less than one-tenth of 1%. The amendments contained in Bill S-17 will have no sustained impact on drug prices. In fact, the impacts will be barely noticeable.

I am sure that members on the other side of the House will remind you, that I was once among those who were concerned about the impact of our patent regime on drug prices. I remain concerned. When I sat on the opposition benches I feared that changes to the Patent Act might tilt the balance between supporting innovation and providing drugs at reasonable prices. I was concerned that changes would lead to rapid increases in drug prices but that quite simply did not happen.

I am sure all members of the House, although there may be some exceptions opposite, will share my satisfaction that drug prices have not risen dramatically in Canada since the Patent Act was first modernized in 1989. This year the Canadian Institute for Health Information has stated:

Given that the drug price index(es) have remained relatively stable since the early 1990s, it appears that increased utilization and the entry of new drugs are the main factors behind the increase in drug expenditures.

Members should quote from authoritative impartial sources when engaging in the debate and not quote in a partisan manner the views of members on either side of the House. There are many reasons drug expenditures are climbing, but I want to emphasize that drug prices are being kept in check.

Our current patent regime serves Canadians well. According to the latest report from the Patented Medicine Prices Review Board prices in Canada are 11% below the median foreign prices. Canadians currently pay 40% less for their patented drugs than Americans do. Americans continue to come to Canada to take advantage of our lower drug prices.

As we sit in the House debating the issue, busloads of Americans continue to cross the border to buy brand name drugs in Canada at up to 40% less than the cost of the same drugs available to them in the United States. I recall that our early working exception, which was successfully defended before the WTO, would continue to provide Canadians with access to lower priced alternatives as soon as possible after expiry.

I would like to point out the simple and straightforward nature and purpose of the amendments to Bill S-17. They bring the Patent Act into compliance with our intentional obligations.

Members opposite may say what they will, but unless Canada does as is suggested by members of the New Democratic Party, which is to withdraw from international trade rules to establish a fence around Canada and say that we will trade only with ourselves, we have to comply with WTO rules.

Is it any wonder that in the province of British Columbia the New Democratic Party is about to suffer a humiliating defeat when its members live with their heads in the sand and do not respond to the needs of ordinary working Canadians? Is it any wonder that people currently working in the auto manufacturing plants in southern Ontario and in the province of Quebec have overwhelmingly turned away from the New Democratic Party? Is it any wonder they have turned away when all of these people rely on exports for their jobs, and when all these people have been described by the leader of the NDP as being rich Canadians not paying enough taxes because they work an overtime shift at an auto plant?

No wonder the party is going the way of the dodo bird. It is no surprise the member opposite lost his pants recently when he was out in the middle of a melee in the protest of Quebec City. However, I digress.

In short, now is not the time for a protracted debate about whether Canada's patent laws need to be changed. Once the bill is passed we will have other opportunities to engage in a broader dialogue on the role of intellectual property, building an innovative economy and sustaining an attractive environment for investment.

The government's objective is to build a world leading economy, one that is driven by innovation, ideas and talent, an economy that produces goods and services which compete in terms of quality and price with the best in the world. We need a strong and moderate intellectual property framework, one that protects creativity and innovation, one that helps us attract talent and investment from around the world. The amendments to Bill S-17 would help maintain Canada's leadership in the global knowledge based society.

I would urge members on all sides of the House to work together to ensure responsible and quick passage of the bill in keeping with Canada's obligations under the WTO. I thank members for their consideration of the bill.

[Charlie Penson, Canadian Alliance, Peace River, AB]

Mr. Speaker, I am happy to take part in the debate today.

I realize the Minister of Industry was away from the House and from parliament for a few years. I thought he was down east in Newfoundland but obviously he was further east than that. He was in the Middle East on the road to Damascus because he certainly had a conversion along the way in this drug patent regulation and on free trade. I would say good for him. He may have been slow but he finally got there, and I am glad he and the Liberal Party have.

I rise to speak today on the subject of Bill S-17, an act to amend the Patent Act. The purpose of Bill S-17 is to bring the Patent Act into compliance with our international obligations, obligations that Canada signed many years ago. These obligations stem from the trade related aspects of the intellectual property rights agreement, commonly known as TRIPS, which Canada and all other members of the World Trade Organization, approximately 145 members now, are signatories.

Bill S-17 would amend the Patent Act to implement two rulings made by the World Trade Organization against Canada.

In October of last year, the WTO ruled against Canada on a complaint initiated by the United States. At issue was Canada's term of protection of old act patents or pre-1989 patents that did not conform with TRIPS. The TRIPS agreement requires WTO members to provide a patent term of 20 years from the date a patent application is filed.

New act patents are those patents that were granted since 1989 and already conform with a patent term of 20 years from the date of filing and are not affected by the WTO ruling. However old act patents, patents that were made before 1989, were only given 17 years at that time. Bill S-17 would change section 45 of the act to provide old act patents a 20 year term of patent protection which is in line with our TRIPS agreement. According to Industry Canada, the amendment would affect 53,500 patents, of which 30 are commercially significant drugs.

The second ruling was from 1997. The European Union initiated a WTO dispute settlement process against Canada over two exceptions to an action for patent infringement. Since 1992 the Canadian Patent Act allowed generic drug companies to develop a generic version of the patented drug in order to obtain regulatory approval and to manufacture and stockpile a patented drug before the patent had expired. The European Union claimed that both these exceptions were inconsistent with the TRIPS agreement. However the WTO determined that Canada's early working exception was consistent with TRIPS but not the stockpiling provision that we had.

Bill S-17 would implement the WTO ruling by revoking the manufacture and storage of patent medicine regulations, regulations to prevent the infringement of a patent by any person that would be enacted by order in council.

The Canadian Alliance recognizes that the right to own property and benefit from private property is an important aspect, including intellectual properties.

I would like to briefly mention that a relative of mine from Peterborough by the name of John Stephenson patented the first Peterborough canoe in about 1879. I recently had the opportunity to see that patent when I visited the Peterborough canoe museum. Canoeing was a way of travel in those days. There were no railways and no highways. The lakes and rivers were the highways of Canada. He developed a new cedar strip canoe what eventually went on to become the Peterborough Canoe Company known all over the world. He applied for and received a patent for that over 100 years ago.

We recognize that it is important to protect one's property. It lies at the very heart of our legal and economic systems and it distinguishes us in a free society. Moreover, the protection of intellectual property, domestically and internationally, is the foundation necessary for a knowledge based economy. By passing the bill, Canada would send the right signals to the international community that we take our obligations very seriously. We need to do that because so much of our trade depends on outside sources. I believe that over 45% of our gross domestic product now comes from exports and it is rising every year. Canada's prosperity depends on trade that is based on rules and international agreements.

As a medium sized economy, Canada cannot compete with the big players who can throw their weight around on the world scene in terms of subsidies, countervailing duties and trade wars. We simply cannot afford to do that. We need the rules based system to protect us. However, we can compete and win in an open rules based trading regime with a dispute settling mechanism based on law, such as the WTO.

I will digress for a moment and talk about the softwood lumber dispute that is currently happening with the expiry of the softwood lumber agreement. This could well end up at the World Trade Organization. Canada could win that dispute but we need international organizations, like the WTO, with the rules that are provided, in order to ensure Canada's prosperity in things like our forestry industry.

As a result, we cannot ignore rulings when they go against us. We have to bring our laws into line with the obligations we signed internationally, which is what we are doing here. We may not like the decisions that come out against us from time to time but there is no question that we benefit from the stability and clarity that the WTO provides to world trade.

As I mentioned, it was the United States that challenged Canada's treatment of pre-1989 patents at the WTO. Two way trade in goods and services between Canada and the United States jumped up from $626 billion in 1999 to $700 billion in 2000. Canada exported $130 billion more worth of goods and services to the United States than we imported from our southern neighbours. This is a fantastic achievement for a small country of 30 million people.

Canada also sells more to the United States than any other country does by a wide margin. In 1999 Canada's market share in key markets in the United States was close to 20% of its overall consumption in the United States. Mexico's market share in the same markets was just over 10%. A lot of people in the United States and even in Canada do not realize who is the biggest supplier to the United States. We are by far. While Mexico is making inroads, Mexico's market share in the same market was just over 10%. A combination of all 15 countries of the European Union together have a market share roughly the same size as Canada.

The Canadian-American rules based trading relationship is very important to Canadian prosperity and has been the model for the world to follow. In fact 87% of our exports last year went to the United States and it is rising every year. We benefit greatly by having a terrific neighbour to the south that takes a lot of the good products that we manufacture. However, we do need the protection of trade agreements, like NAFTA and the World Trade Organization, to ensure that continues.

The generic drug companies have expressed their understanding that the WTO rulings must be implemented. They have also indicated their dissatisfaction with the way the drug patent regulations are being implemented. For example, the generic companies feel that the research based drug companies are able to extend their patent beyond 20 years through the notice of compliance linkage regulations. Some argue that this two year process is not in Canada's best interest.

The debate over the regulatory environment for drug patents is a very important one but it should not slow down the passage of the bill. Bill S-17 is basically a technical bill designed to enable Canada to comply with its international obligations. The WTO gave Canada until August 12, 2001 to implement the recommendations and the rules arising from the U.S. and European Union challenges. It is time to pass the legislation.

Although the debate on drug patent regulations is very significant, it should not affect the passage of Bill S-17. While appearing before the Senate banking committee on trade and commerce, the Minister of Industry had to eat a little bit of crow about his past comments regarding drug compliance. He promised to take a much broader look at the drug patent regulations in the fall. I applaud him for both admitting that he was wrong in the 1980s and now looking at how we should handle our new drug patent regulations. I am also pleased he recognized the current dispute between the generic and research based drug companies and promised a role for parliamentarians.

I suggest that the industry committee should do a separate study regarding the issue of notice of compliance and the two year stay. It is an important debate and all things have to be put on the table. It would be a good opportunity to do it at the industry committee. I suggest to the minister that is where it should start, but it should not affect the passage of the current legislation we have before us. Bill S-17 should be passed and then let us deal with that issue to see who is right on the notice of compliance. It should be a separate issue.

We will co-operate from our side. We want to see Bill S-17 passed. We think the issue of the generic and patent drugs with regard to the timeframe pass the 20 year patent, the notice of compliance and the two year stay are all important issues that need public airing. I challenge the Minister of Industry to make sure that happens.

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, I am pleased to rise to speak to Bill S-17, an act to amend the Patent Act.

We in the Bloc Quebecois believe that the issue of intellectual property is fundamental and important in the context of stimulating innovation and creativity, especially in the health sector where access to the latest discoveries and to new technologies enables us to make extraordinary discoveries that help treat diseases, old or new. Huge effort and investment in research and development is required.

In order to encourage research and development in business, discoveries must be properly protected through the protection of intellectual property.

The bill corrects two discrepancies that unfortunately had to go through an international body. We could have done the work ourselves without waiting for the WTO to reach its decisions, which informed us that old provisions with respect to products covered under old legislation dating from the early 1990s created a problem with respect to the effective protection afforded these patents.

There will therefore be technical amendments, in short, nothing basic, to the focus of the policy on the protection of intellectual property. I hope the bill will not, once again, become a debate on the need to protect those doing research and development.

On the contrary, if we were to go in that direction, I hope we would insist on strengthening and improving the protection afforded to those who make discoveries. Even though we are complying with international conventions, the level of protection of patents is lagging somewhat behind that of the United States and the countries of the European Union, among others.

It must be realized that the discovery of a drug is not a simple process. It is extremely costly. On average, we are talking about an investment that may vary from $300 million to $500 million U.S. to discover a drug that will be a significant improvement. A patent for a new product is a huge investment that must later be recovered by these companies.

The shorter the period the higher the price will be. However, if the period of protection of the product on the market is long, the recovery of that investment may take place over a longer period. We will then have access to a quality drug that will cost less than if the protection period were very short. It may well take 10 years before a promising molecule or a brilliant idea is marketed as a commercial product, given the process at Health Canada, among others, for certification, the clinical tests, the four test phases and so on.

In reality, the patent has an actual lifespan of about 10 years on the average. We are not necessarily talking of those that go on for 20 years in practice. Obviously the product is patented as soon as it is discovered but just being discovered does not put it on the market the very next day.

Given this situation, when protection is given for a certain length of time, the day that protection expires we hope to see the dynamics of competition set in. Thus there will be generic versions that are far less expensive because copying a product does not require anything like the investment discovering one does.

What we want to be sure of is that once a patent has expired there will be a competitive market in which the various companies operate on the marketplace. There is a special situation in the Canadian market, however, because of the highly aggressive nature of the generic industry. It has every right to be that way. In each of these debates, it voices the same desire to at last find ways of reducing the true scope of patent protection.

I have no objections once a patent has expired to the industry having access to the market within the normal rules of competition. We do however have to ensure that there is a proper period of protection for patented products, so that the public can have hopes for significant discoveries relating to numerous conditions and health problems that cannot yet be treated and investment can be attracted to our country's high calibre scientific community.

Of course I am most familiar with the situation in Quebec but I do know that the industry has also developed in other provinces. Ontario too has a sizeable industry. As well, there is a very strong emergence of biotechnology research in this area. In order to develop and maintain our quality of research and keep our researchers here, however, they need to be able to work within a framework in which there are advantageous rules on intellectual property. This we have.

In Quebec, with the university network, for instance, and many companies, we have know-how that makes us one of the best places in the world in which to do this kind of research. We have every interest in further developing this industry, which will benefit citizens through the discoveries we make in health, as well as economically, and in having a scientific community such as this present in our territory.

All this is to say that, although this is a good opportunity to pay tribute to all the work done by those working in this industry and to encourage them to invest even more because we want more research and development, I do not want to see this debate drag on too long.

It is obviously a bill intended to comply with WTO rulings. We are therefore going to treat it accordingly. We hope the debate in committee will be rapid. The committee is obviously its own master but as a member I can already say that we will be among those who hope that the debate is speedy, that the bill will be approved in committee and that eventually it will come back to the House for final approval in order to clarify the situation.

I hope we are going to send a clear message at the same time that there is no question of reviewing or weakening the rules of intellectual property. The Minister of Industry is with us on this. I know the government has set itself the ambitious goal of ensuring that research and development Canada wide will double in the next 10 years.

This will require a framework to protect intellectual property and freedom from the fear of threat for those working in innovative industry. These people must be told clearly that the measures to be taken in the future, if there were to be others, will not weaken intellectual property but rather strengthen it and further develop all those who contribute to it.

In the case of Quebec, they are many, and I hope there will be more of them in the pharmaceutical and biotechnology sectors, all of this within certain restrictions but in a context in which the industry has essentially honoured its commitments to increasing research. I think over $900 million is spent on research annually. The number of jobs has grown since the passage of the legislation on patent protection. This is what the industry had predicted and this is what happened.

Before I conclude I would point out that there is an important body whose role it is to protect consumers. It is the Conseil du prix des médicaments brevetés. Its role is to ensure that the price of patented drugs on the market is reasonable and does not rise inordinately.

Within the limits of a protective framework for intellectual property, with an efficient Patented Medicine Prices Review Board, we are in a position to have a balanced approach to permit the emergence of a very solid industry. We are also in a position to produce products of increasing value to consumers, which in some cases will help reduce hospital stays and provide non-surgical solutions without increasing health costs. There is often a perception that drugs increase health system costs. In some cases, drug use can reduce costs because hospitalization will be avoided.

With our greying population, we have a duty to provide a context, an environment that is favourable to research and development, in this sector as in others. This one, however, is a sector that affects all those whom we represent.

We will co-operate in ensuring that the bill gets through as promptly as possible.

[Svend Robinson, NDP, Burnaby—Douglas, BC]

Mr. Speaker, I rise on behalf of members of the New Democratic Party to say that we are strongly opposed to this unfair and inequitable bill.

I was frankly very disappointed to hear members of the Bloc Quebecois, who claim to belong to a social democratic party, giving such amazing support to the demands of pharmaceutical companies.

Obviously, there is only one party in this parliament which is fighting for the poor, for ordinary people, who are saying that the big pharmaceutical companies do not need more handouts from their friends in government.

I see the Minister of Industry in the House today. We have had the privilege of serving together in the House since 1979. I am one of the few members of the House who was in the House with the minister in 1987 when he spoke with passion, eloquence and vigour in total opposition to Bill C-22. He called it a giveaway to the multinational pharmaceutical companies. He was absolutely right.

In one memorable quote he said that Bill C-22 would suck the life's blood out of Canada's poorer citizens. I recall it well. The minister was up on his hind legs speaking out and screaming out strongly for justice for Canada's poorer citizens. That was he and the Liberal Party.

Bill C-22 passed. Then in 1992 what did we have? We had another bill, Bill C-91, another Conservative bill and another giveaway to the pharmaceutical drug companies. What did the Minister of Industry have to say at that time? On behalf of his Liberal colleagues, along with the member for Dartmouth and many others, he denounced that legislation and bitterly complained it would lead to a massive increase in the price of pharmaceutical drugs in Canada. The minister was absolutely right.

When we look at the increases in the price of drugs in Canada, it is the fastest growing component of our health care system, far faster than the increase in the price of physician services. Indeed it is the biggest single component of our health care system, as my colleague for Winnipeg North Centre pointed out so strongly on a number of occasions.

Over the past 15 years I would point out that Canada's prescription drug bill has jumped by 344%. That is 15 years since the Minister of Industry warned Canadians about what would happen.

It is not as if these pharmaceutical drug companies are suffering.

The Bloc Quebecois is suggesting that the poor pharmaceutical companies must be defended. It is sad, such a pity, the poor pharmaceutical companies need defending by the Bloc Quebecois.

Let us look, for example, at the largest pharmaceutical company, GlaxoSmithKline, which made profits of some $11.9 billion in one year. It does not need the Bloc Quebecois to defend it. That is clear. Those who need defending are consumers.

It is the consumer, patients, the poor and provincial drug plans that need defence from the government and from their allies in all of the other opposition parties. What an unholy alliance the Liberal government, the Alliance, the Bloc Quebecois and the Conservatives. At least the Conservatives have been consistent. They have been consistently wrong but at least they have been consistent, not like the Minister of Industry who has done the most extraordinary flip-flops.

It was a sight to behold in Davos, Switzerland. I wish I could have been there to see the Minister of Industry speaking in Davos, Switzerland and saying “I fess up, I was wrong Brian”. Brian Mulroney was standing there as proud as punch as the Minister of Industry stood and said he was wrong, the Liberals were wrong and that he was right, NAFTA was a good thing.

A few weeks later he stood in front of the senate, that great bastion of democracy. That was another occasion when he said he had it all wrong back in 1987 on Bill C-22, that the Conservatives were right and the pharmaceutical industry was right. He was there to defend the interests of those poor, suffering pharmaceutical companies. Why? Because the WTO told him that they no choice.

What a shameful spectacle this is. Why should we ever believe anything the minister and the government have to say. I know the Speaker, a man of integrity and respect, will recall those debates because he was in the House. Indeed I dare say he participated in one or two of them. I am not going to pull out the speeches of the Speaker because I know that would be entirely unparliamentary. However it is certainly appropriate to remind the Minister of Industry of exactly what he said. We used to have the lowest priced pharmaceutical drugs in the world. Now, as we have seen, drug prices have risen dramatically.

As the minister indicated, the purpose of the legislation is to implement a WTO tribunal order. We were challenged by the European Union and the United States that our existing generous provisions for patent protection were not good enough.

Until this bill becomes law, the generic drug industry is at least allowed to stockpile and to get their drugs ready six months before the expiry of a patent so that when that patent expires consumers, Canadians who are sick, will be in a position to buy those generic drugs quickly. That is something the Minister of Industry supported long ago, but not anymore. Now they are saying no. Even that six month stockpiling opportunity is gone.

The minister is retroactively extending from 17 years to 20 years the patent protection. This is a retroactive gift to the pharmaceutical industry approved by the Bloc, the Alliance and the Conservatives. Why on earth would the government give this retroactive gift to the struggling pharmaceutical industry that just reported massive record profits? In another day the minister would have been the first on his feet condemning this largesse to an industry that has already been treated far too generously.

As New Democrats, we say that this is unacceptable. When we look at the history of this legislation, it is quite shocking to know that not that long ago under GATT there was no reference at all to intellectual property. In fact it was only after the Uruguay round of the General Agreement on Tariffs and Trade that intellectual property was protected in these so-called trade deals.

That is another reason why as New Democrats we are deeply concerned about the impact of the proposed FTAA, the free trade of the Americas agreement. We know what the Americans are pushing for even more protection. Let us be very clear, it is only the Americans in this hemisphere that are exporting that. It is only those big, multinational American pharmaceutical companies that benefit from this.

Is the Government of Canada and the Minister for International Trade standing up on behalf of Canadians and people throughout the hemisphere and saying to the Americans that there is something wrong with this picture and that they do not support extending the patent protection to 25 years from 20 years? No, there is not a word, not a peep. There is silence.

The trade department keeps telling us to go to its website to find out what Canada's position is. If we go to the website, under intellectual property rights is a summary of Canada's position. Where is the leadership? Is the government speaking out for consumers? Is it speaking out for the poor? This is what the department had to say on intellectual property rights.

To date, Canada has made no submissions to the Negotiating Group on (intellectual property rights). Any submission made by Canada will be made available on the website.

There is the leadership. The government has nothing to say. The Minister for International Trade has nothing to say about one of the most shameful abuses of power by pharmaceutical drug companies. That is their attempt to muscle the government of Brazil in this hemisphere into increasing dramatically the prices of drugs that are made available for people living with HIV and AIDS.

Recently there was a major victory in South Africa when under tremendous international pressure 39 pharmaceutical companies, which were suing the South African government under the WTO, were forced to withdraw that suit because it was obvious they were suffering from international shame. They were trying to tell the South African government and health ministry that they had no choice that, even in the face of a catastrophic epidemic of HIV-AIDS throughout sub-Saharan and South Africa, the interests of multinational drug companies had to come ahead of the interests of patients. Profits before patients.

In the case of South Africa, they were shamed into backtracking and with no thanks to the Government of Canada or the Liberal government. We called on them to show some leadership in a situation of absolute crisis.

There are 25 million people infected with the AIDS virus in sub-Saharan and Africa out of 34 million globally. The multinational pharmaceutical companies want to prevent them from having access to affordable drugs. That is absolutely shameful.

However we see the same thing in this hemisphere in Brazil. We know that in Brazil the government has shown some extraordinary leadership in making generic drugs available. It has had a very powerful and significant impact in reducing the incidence of HIV-AIDS. In 1994 the World Bank predicted that by the year 2000, Brazil would have 1.2 million AIDS carriers. Today there are less than half of that. There are about 540,000. There are still far too many. Thanks to the courage of the Brazilian government in taking on these multinational pharmaceutical companies, it was able to make a difference.

As New Democrats we do not want to see the intellectual property rights of pharmaceutical drug companies enshrined and enhanced in the FTAA. We want to see a new regime where people are put before profits and pharmaceutical drug companies are accountable to the people in the hemisphere and globally.

I am not speaking in any way on behalf of my party, but I often wonder why we believe that in an industry as fundamental to public health and security as the pharmaceutical industry should be driven on the basis of profit. We have a situation now in which only a tiny amount of money, something like $300 million globally, is being spent by the pharmaceutical drug industry in the struggle to find a vaccine. Why is that? Because if it finds a vaccine, it finds a cure and then shares in the pharmaceutical drug companies will not be worth as much money. There is something obscene about that.

We have a situation as well where researchers are working for this pharmaceutical drug company or that pharmaceutical drug company. They are all working in splendid isolation, not co-operating with one another and desperately trying to find what will make them more money.

I suggest that instead of accepting that the market is God when it comes to pharmaceutical drugs, it would make a lot more sense for us to say that this should be in the public domain, those who serve in the health care industry, those who research, those who try to find cures and the government. The public domain should be involved. Health care, and in particular the pharmaceutical industry, should be owned by the people not by those who seek to maximize global profits.

Once again, as New Democrats we do not accept this loss of democracy through the WTO, through the TRIPS agreement, the expansion of GATT and now the FTAA. More and more we are losing democracy in this country. More and more as elected representatives we are losing our ability to make decisions about what is in the best interests of the people who we represent. Bill S-17 is an other example of that.

As elected representatives, as members of parliament, why should we not be in a position to have a public policy debate in Canada about whether 17 years is good enough, or 20 years is good enough or whether compulsory licensing is acceptable as a means of ensuring that, as long as this is in the private sector, there is still an incentive to bring new drugs on the market? However not in a way that jeopardizes access to affordable drugs for Canadians.

That should be a decision we make. However, the Minister of Industry comes before the House and says, “Tough luck. Forget it. You no longer have an option”. As an elected government we no longer have an option. We have no choice because the WTO is forcing us to do this.

One reason why every member of the New Democratic caucus marched in the streets of Quebec City against that FTAA agenda was because we believe in democracy. The agenda of the FTAA, the WTO and GATT is an assault on that democracy. This bill is an example of that.

Instead of moving forward with this legislation, which we vigorously oppose as New Democrats, I call on the government to take a strong stand at the WTO and in the negotiations on the FTAA for affordable accessible drugs for people who are suffering from HIV-AIDS and other life-threatening diseases.

Recently, Médecins Sans Frontières called on the minister of trade not to bow to pressure from pharmaceutical drug companies to further strengthen drug patents. John Foster from the North-South Institute said “It's is absolutely tragic that the minister of trade has absolutely no position on this issue”, the issue of access to affordable pharmaceutical drugs in Brazil. He went on to say “although from prior positions we believe he goes along with United States, drug companies and those in favour of even firmer patent laws”.

We call on the government to stand up for democracy and affordable drugs. Not extend even further the patent protections that are afforded to pharmaceutical drug companies, but recognize that they have already done very well under this legislation. They say they need resources for development of new drugs, yet the reality is that these same drug manufacturers spend twice as much money on marketing their drugs, on pushing their drugs, as they do on research and development.

All hon. members have to do to see this is open the Medical Post or any other major medical journal. Our spokesperson on health has pointed out the absolutely obscene amounts of money that are spent by these companies in marketing drugs.

We also know that we are seeing more and more corporate influence in post-secondary education and universities. Recently a university professor who challenged some elements of the safety of Prozac had his offer of employment at a university in Ontario summarily withdrawn because one of the pharmaceutical companies that funds the university objected vigorously.

Corporate influence is very dangerous in post-secondary education. Corporate influence on this Liberal government is growing and is stronger than ever before.

Once again, we as New Democrats say no to Bill S-17 and yes to affordable drugs for all Canadians.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I want to thank the member for Burnaby—Douglas for a passionate speech and a speech that I know comes from the heart. As a veteran in this place, he has seen this debate come and go through many incarnations.

The member pointed out some things that took place before I came to the House of Commons. One is the unbelievable reversal in and around 1992 and 1993 when the Tory government brought in Bill C-91. I remember it well. There was outrage, a hue and cry, and activists were taking to the streets over Bill C-91. The Liberal Party, at that time in opposition and running for government, condemned Bill C-91. It actively hammered away at the ideas that Bill C-91 would jack up and spiral and escalate drug prices. The Liberals said it would limit the ability of generic drug companies to put necessary drugs into the hands of Canadians at less cost.

I even remember when the member of parliament for Winnipeg North Centre at that time, David Walker, the candidate I ran against, toured a task force on Bill C-91 right around the country. In fact, on the behalf of some people there was great hope and optimism when the Liberal government took power that this task force would come back with some relief, some hope, some optimism, and that we would be able to get out from under this millstone of this lengthy patent protection.

However, the results of that touring task force, chaired by the member for Winnipeg North Centre at the time, were that the members came back and said there was nothing we could do, that we had traded away our ability to have a domestic pharmaceutical policy and even our ability to look after the interests of Canadians before the interests of multinational drug companies.

Frankly I would like to hear more recollections from the member for Burnaby—Douglas in regard to exactly what transpired in that period of time. I would like the member for Burnaby—Douglas to explain what he thinks the Liberals' thought process was to enable them to do such a dramatic flip-flop.

[Svend Robinson, NDP, Burnaby—Douglas, BC]

Mr. Speaker, certainly I appreciate the comments and the question of the hon. member for Winnipeg Centre, who has been in the forefront of the struggle in the House, and indeed in his previous life, for affordable, accessible drugs for Canadians.

I would not for a minute suggest that the flip-flop of the Liberals from their position in 1987 on Bill C-22 and from their position in 1992 on Bill C-91 had anything to do with the massive amount of money that they get every year from pharmaceutical drug companies as donations to the Liberal Party of Canada. Of course not. That has absolutely nothing to do with it. I know that the Bloc position has absolutely nothing to do with that either. J'en suis certain.

I do want to take advantage of the opportunity that has been afforded to me by the member for Winnipeg Centre to share with the House some of the statements that were made by the Minister of Industry, then a member from Newfoundland and Labrador. On November 16, 1992, the Minister of Industry spoke in the House, then in opposition of course, on Bill C-91.

He said we have lower health care costs in Canada on a per capita basis than they do in the United States largely because of our prescription drug program, which this government wants to do away with. What are we to conclude from that other than that the government wants to increase the cost of health care in Canada? It will do that at the expense of the taxpaying public and at the expense of the provincial governments because provincial governments in many cases will buy, through their drug plans, significant quantities of these same pharmaceutical drugs.

The Minister of Industry went on to read from a text that talked about the burden of changing patent legislation. He said “Extending the patent life of drugs is likely to cost consumers immediately and also add to the burden on the government health plans, which are already under economic pressure. Compared with hospital and doctors' bills, prescription drugs are a relatively small though rapidly growing expense”.

The member pointed out that even in the United States people were lauding Canada's generic drug system, saying “However, here in Canada the government wants to do away with it”.

I would note, and my colleague from Regina pointed this out a few minutes ago, that the cost of just this one amendment to Bill S-17 will be over $200 million to Canadian taxpayers, both through pharmaceutical drug plans and of course directly for those who are not covered.

Why is it that we are giving a $200 million gift to pharmaceutical drug companies in this country? There is absolutely no excuse whatsoever for that. For that reason as well, we as New Democrats strongly oppose this legislation.

[Pierre Brien, Bloc, Témiscamingue, QC]

Mr. Speaker, I want to clarify a couple of things for the benefit of those who are following this debate.

In my view, the hon. member just made a very simplistic speech that borders on demagoguery for a number of reasons. His position can be summarized as follows: if a private company in which individuals invest does research and makes a discovery, the next day anyone should be allowed to copy this discovery. Basically, companies are expected to discover drugs and develop new products in a philanthropic fashion. That pretty much sums up the NDP's position.

I am glad that the hon. member mentioned AIDS. I will tell him about 3TC, a medication he knows a great deal about, which was discovered by BioChem Pharma, precisely in an environment that provided some protection to intellectual property. A drug must be discovered before it can be made accessible. And for it to be discovered, we must invest in research and development.

Under the hon. member's model, the state must engage in research and development so that everything will be fine. I doubt it. It is a very good thing in an industry to have motivated people who are knowledgeable in their field doing research in partnership with health care and educational institutions and discovering new products. Naturally, some are motivated by profit, but so what? It just makes them spend even more time and energy on research. What we are doing is providing some protection to these people for a while.

If the protection is reduced or the protection period shortened, it will not result in cheaper prices for drugs, on the contrary. The less time these companies have to recover their investment, the more they will charge for their products.

The solutions proposed by the NDP would result in drug prices that would be even higher than they are now. I hope that the hon. member does not really believe what he said.

[Svend Robinson, NDP, Burnaby—Douglas, BC]

Mr. Speaker, I hope the Bloc member will take another look at history, because he totally lacks any historical perspective on this issue.

Before the Patent Act of 1987, pharmaceutical companies were making huge profits. They had one of the highest levels of profits among Canadian industries. In the meantime, because of the compulsory licensing program set up in 1969, under a Liberal government I must add, drugs were quite affordable, especially for the poor.

The suggestion that we cannot have at the same time drugs being sold at a reasonable price and large pharmaceuticals ringing in huge profits is patently false.

We, in the NDP, do not agree with the Bloc members that we have to focus on the profits of the pharmaceutical companies. It may be their objective but that is not a very social democratic position for the Bloc to be taking.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I as well listened to the Minister of Industry's speech, the general drift of which was that we should just let Bill S-17 pass and there would be ample opportunity in the future for us to revisit the whole idea of lengthy patent protection and some sort of domestic pharmaceutical policy.

Does the member for Burnaby—Douglas believe that we still have the domestic ability to negotiate these things or have trade agreements limited our ability to have a domestic policy in that regard?

[Svend Robinson, NDP, Burnaby—Douglas, BC]

Mr. Speaker, the short answer is that we have ceded much of our sovereignty already. Surely before we succeed in dismantling democracy and sovereignty in Canada, we have to stand up and fight back and say no to the WTO forcing this kind of change on Canadians in our pharmaceutical drug policies. Unless we say no now there will be no opportunity to change this in the future.

[Loyola Hearn, Progressive Conservative, St. John's West, NL]

Mr. Speaker, it is my pleasure to say a few words on Bill S-17. It is an interesting day in the House as we see the debate unfold.

A lot of people across the country think that when one is in government one agrees with certain things but when the shoe is on the other foot one always objects to whatever government does. In a couple of cases here, that is not factual.

After listening to the debate from our friends in the NDP, I would say that it is quite clear that they stand where they always did on the issue. I will be making it quite clear that in my party we stand where we have always stood on the issue. In this case, we support the bill, as we did when the original bills were introduced by the Tory government and, as has been pointed out a number of times today, objected to strenuously by the then opposition party, which is now the governing party. It is amazing how the tide turns.

I did not think I would be supporting my friend and colleague, the minister of trade and industry. It is very difficult to do in light of several issues about which we thoroughly disagree. However, my party does support him on this issue because the bill itself was a Tory initiative.

I will explain to my friends from the NDP why we support it and I think by the time I am finished they will also perhaps agree with us and support the bill.

However, it is interesting to note that the government of today was against the original bills, Bill C-91 and Bill C-22, when they were introduced in 1987 and 1992. The more interesting parts of all of this are some of the comments made by those who are now government members. Some of the people who voted against those bills, by the way, were the present Deputy Prime Minister and present government House leader.

In 1992 during the debate on Bill C-22, the minister of industry and trade, who is sponsoring this bill, said “It is inconceivable to me that parliament finds it necessary yet again to deal with yet another measure proposed by the government because it is bound and chained to some ideological dictate which says this kind of patent act is necessary”.

I am sure he was reading from a prepared speech when he said that. However, at the time he was against the very bill which he is now proposing.

Here is another interesting quote from him, which leads into what I have to say. He said:

The citizens will need more than generic drugs to recover from the festering wounds which are about to be inflicted on the exposed ankles of Canada's poorest citizens when the Minister sinks his teeth in past the bone, into the marrow and sucks the life's blood out of Canada's poorest citizens with Bill C-22.

Those are strange and interesting words, which came from the present Minister of Industry.

People are allowed to change their minds. People see the light and become converted. The minister said today that he had been concerned about the increase in drug prices at the time, but they did not happen. He said indirectly that Prime Minister Mulroney had been right to bring in such a bill. Just a short while ago, as has been pointed out today, the minister said that Prime Minister Mulroney was right about free trade.

It will be interesting to see over the next while how many things the minister agrees with that he fought so hard against as a rat packer before his party became the government.

The NDP has expressed a concern, of which all of us are conscious, that the bill might lead to increased drug prices for people with major illnesses, many of whom cannot afford the drugs they need.

One of the most memorable occasions for me during the last campaign, and I am sure members on all sides of the House remember talking to people affected by the cost of drugs, was meeting a gentleman who had just been diagnosed with Alzheimers and whose wife was trying to cope with it. A drug had been prescribed to retard the advancement of the disease, a drug called Aricept I believe. The drug was not covered by medicare and the family had to pay the extremely high cost themselves. That meant other pleasures of life had to be sacrificed, including a little car that enabled them to get back and forth to the cabin. They had to sell the car to pay for the drugs. That is not the way it should be in Canada.

Can we blame pharmaceutical companies for that? The answer is no. We blame governments for that, because if an effective drug is brought on the market, tested and approved, the government should immediately sponsor it under medicare.

The NDP has expressed major concerns about drug companies getting rich and the impact of drug costs on poor people. However one important element has not been raised: Those who need drugs would not have them if somebody did not put the time, effort and money into their development.

Let us look at cancer. Very few of us in the House are not affected, directly or indirectly, by that dreaded disease. Will we ever find the cure for it? The answer is that we are hopeful. Will we find the cure for AIDS and other dreaded diseases worldwide? Luckily our country is not affected to the same degree as other countries but certainly we are affected by it. Will cures be found for dreaded diseases? They will be found in only one way: If somebody puts the dedicated research into coming up with a drug that will kill or retard the growth of the agents causing those diseases. That can only be done, as I said, by time, concentration and funding.

My colleagues to my right, ideologically to my left, are very supportive of the arts.

I would ask them about the art industry. What if a recording artist made a big hit which took a lot of time, involvement, practice and rehearsals? What would the hon. members think if other performers, who were not as dedicated or bright or could not put together that one great hit, knew it was coming on the market, copied it and pirated the copies around the country? How would it affect the person who put the time and dedication into developing the product?

Drugs are not unlike that. Our hope of combating the major illnesses that affect people across the country may lie in the hope that a pharmaceutical company will develop a cure.

We could say governments should be the ones doing that and pumping money into research. I certainly would not disagree. However, if governments were the ones responsible for doing research, I would question whether the work could be done. Government cannot be as efficient as the private sector. That has been proved over and over.

My concern lies with the people across the country who are faced every day with having to buy drugs. I point to the government opposite and say that should be its main concern. It has the mechanism to alleviate the costs shoved upon people for drugs to treat illnesses. In a lot of cases there are drug assistance programs to do just that. There are always those who fall between the cracks but a smart, sharp government could deal with such cases if it had any vision.

If the people who put their time, effort and money into developing the needed drugs are not given the freedom and protection to do so, they will not do it. They are not in the business of trying to make a breakthrough only to have it taken away from them. When another company immediately starts making generic drugs or starts to stockpile so it can wipe out the company that developed the original drug, that is not fair competition.

The fallout can be handled by government. We could have the best of both worlds if we had a government with brains and vision. Protection and help can be given to those who develop the drugs we need, but assistance can also be given to those who rely on them and cannot afford to pay for them.

It is interesting to see the government trying to solicit support for a bill it was once so much against. I know the NDP, even if it does not agree with us, is saying what it has always said. It has not changed its opinion because the stripe of government has changed.

We are saying the same thing we have said and the same thing the Bloc is saying. I agree totally with its last speaker. The Alliance is also saying that if we are to produce the drugs needed to combat the concerns the NDP talks about, freedom and protection must be given to companies that put the time and effort into developing the cures that are so badly needed.

The government, however, has switched back and forth, which shows that its concern is not for people or companies in Canada. Its concern is for itself. That has become more and more evident.

As we debate the bill further we will all have more to say on it. However we stand on the principles we announced when the original bills were brought in. We think this protection must be provided. Hopefully government will address the other side of the concern.

[John Bryden, Liberal, Ancaster—Dundas—Flamborough—Aldershot, ON]

Mr. Speaker, I want to make a slight comment. I enjoyed the member opposite's speech. I think on this side we all agree that if research in pharmaceuticals is to go ahead then there has to be some sort of profit incentive for that research.

I would also like to make the observation that the generic drug producers, the people who sell generic brand drugs, do not do research. One of the ironies of the whole situation is that the generic manufacturers of drugs produce drugs at low cost and these low cost drugs are consumed in great quantities. One of the ironies in the situation that has always struck me is the fact that the easy accessibility, for example, to new antibiotics has created a situation where we have growing and more rapid resistance to antibiotics.

We have a very ironic situation where the more we make drugs available cheaply through generic manufacturers, the harder the pharmaceutical companies have to work to design new drugs. We have a very, very difficult situation.

I do not know what the solution is. I do know that we certainly have to put incentives in place as best we can to make sure that those who are designing new drugs have the incentives to do so. I am one who believes that I would like to see government involvement, but I really do think this is a private sector initiative that needs to be encouraged.

[Loyola Hearn, Progressive Conservative, St. John's West, NL]

Mr. Speaker, I agree with the member that there are concerns in this area. Because of the amount of drugs we see, the cost of drugs, the effect of the cost on our population and the need to develop drugs to combat major diseases such as cancer and AIDS, perhaps it is time for somebody, whether it be the Minister of Industry, who is by the way a constituent of mine, or someone else, to take a hard look at the whole drug operation.

It is difficult perhaps for people to think that after they put time and effort into developing a product others will duplicate it quickly and sell it at a lower cost. If people do the original work developing something, whether drugs, cars or records, as I talked about, and others are allowed to copy, reproduce and make money on those efforts, the original investors will get fed up with it.

What happens if new drugs are not developed? That is the question we must face. How can we create an environment in which everyone benefits? It can be done. It takes leadership, co-ordination and proper legislation. If protective measures are not there for the forerunners in all this I am not sure what the result will be. We will have a lot more concerns than just the cost of drugs.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, would the member for St. John's West agree that the goal, for all the moral and ethical reasons one could cite, must be to get drugs into the hands of the people who need them most at the most affordable cost? Would he not agree that our single and most primary objective as legislators is to put in place a legislative slate that would enable drugs to get into the hands of people who need them at the cheapest possible cost?

That raises the question. We have heard the argument in speeches today and on other occasions that even prior to the existing intellectual property patent protection the drug companies were making good, vast, healthy profits. What we are seeing now is their relentless effort to increase profits more and more.

We heard earlier that not all their costs go into research. Over half their costs go into advertising, glossy promotions, TV ads, et cetera, trying to promote their products. We cannot argue that the costs of all drug companies are in research and development.

What does the hon. member think is a reasonable patent protection period of time? Would 10 years be adequate? Have we ever studied this issue in an objective manner? Where is the market research to say or where is the empirical evidence to prove that drug companies need 20 years and now 25 years?

Would he change his mind if we could illustrate to him that if we gave a five to seven year patent protection drug companies could make a good profit? Would he not agree that generic drug companies should be able to take over and get more drugs into the hands of people who need them?

[Loyola Hearn, Progressive Conservative, St. John's West, NL]

Mr. Speaker, there are probably three points tied up in the overall question. In asking the question, I think the hon. member agrees with me that it is time we looked at the whole issue. Perhaps there will be some variation in time. However the other side is that generic groups, not only generic drugs but all generic groups, would have nothing to copy if somebody did not do the original work and put the money up front.

The change being asked for in Bill S-17 is because of compliance with World Trade Organization rulings. NDP members are against free trade. They are against the private sector. They are for getting money into the hands of average people and making sure their costs are minimal.

We also agree with the last one point, but unlike the NDP we know we cannot help people have access to cheap drugs, receive the social services they need and obtain the health care assistance they need unless somebody generates the dollars which enable us to reinvest in that. We could only do that through trade, commerce and investment by the private sector.

[Judy Wasylycia-Leis, NDP, Winnipeg North Centre, MB]

Mr. Speaker, I listened to the Conservative member whom I respect very much in terms of his honest contribution to this debate and other issues. However we are obviously at fundamental odds philosophically and politically.

There is no question that on the one hand we are dealing with a party determined to seek progress through commercial interests and through aiding and abetting private needs in society, versus a philosophy epitomized by the NDP of putting the public good first.

How could the hon. colleague justify his pursuit of private control and international control over something as fundamental as access to necessary medications when many people are being left behind and not served by that kind of shortsighted policy?

[Loyola Hearn, Progressive Conservative, St. John's West, NL]

Mr. Speaker, I am not sure whether I agree with the hon. member's opening remarks that we are fundamentally different in many of our views. I suggest there is no one in the House perhaps more concerned about the plight of average citizens, of which I am one, than I am. As I mentioned earlier, I also know full well that to be able to assist those who need assistance somebody has to pay the bills. People say that government should do it, but from where does government get the money?

If there are people who because of illness, disabilities or whatever cannot contribute to the public coffers, it is our duty to make sure they get every benefit they deserve. The dollars needed to do that have to be generated by someone, and that someone has to be the private sector.

If government is conscious of what is happening we can have, as I said earlier, the best of both worlds.

The people who need help should get it, but those who are producers will be protected in a proper legislative framework. Also the people will be protected from any rip-offs. I think we have to be very conscious of that.

[The Acting Speaker (Mr. Bélair)]

Before resuming debate, it is my duty pursuant to Standing Order 38 to inform the House that the question to be raised tonight at the time of adjournment is as follows: the hon. member for Yorkton—Melville, Gun Control.

[Dick Proctor, NDP, Palliser, SK]

Mr. Speaker, I am pleased to take part in this important debate today on Bill S-17. I listened carefully to the member for St. John's West who just spoke on behalf of the Conservative Party.

It is important for people who are listening at home, as well as members in the Chamber, to know that we are talking about part of a bill which would extend patent protection from 17 years to 20 years. It is not a question of a company coming up with a new discovery for AIDS, for example, and the next day a knock-off of the drug is put on the market by a company that specializes in generic drugs.

We were talking of 17 years worth of patent protection. Now the WTO has come along and said that Canada is not in compliance with that. Therefore, in order to comply with the WTO, we have to add another three years to make it a full 20 year patent protection act.

I listened to the Minister of Industry say that this would only involve about 30 patents, but he neglected to say those were worth an estimated $200 million that will be absorbed by Canadian consumers as they purchase higher priced drugs.

The WTO found Canada not to be in compliance with the idea that a generic drug company could manufacture and stockpile drugs so that on the day the patent protection ended they could have their products on the market and ready to go. This too has been termed illegal by the WTO and is dealt with in the bill. We are rushing against the clock to come up with a bill by August 12 of this year to comply with yet another adverse ruling by the World Trade Organization against the Government of Canada.

In 1987 a number of significant changes were made to the Patent Act. Five years were added in 1992 when the infamous Bill C-91 passed in the House of Commons. A number of concerns were expressed at that time by provincial governments about the impact Bill C-91 would have on prescription drug prices.

Shortly after that bill became law I had the privilege of working in the department of health in the province of Saskatchewan, the province which pioneered prescription drug cost and benefits for its people. The government at the time felt that it had no alternative except essentially to gut that legislation as a result of the changes brought about by Bill C-91.

We have seen the costs of prescription drugs increase by several hundred percentage points over the last number of years. They have increased to the point that now, as the member for Burnaby—Douglas noted in his remarks, it is the single biggest expense on a line item as to what any province pays for its medicare system. It is far more than doctors, far more than the cost of hospitals. Prescription drugs now top the list.

That was not the way that it used to be, but that was then and now is now. Some members have done some serious somersaults on this issue over the past 10 years. I will get into that in a few minutes.

Predictions are that prescription drug prices will soar even higher under trade pacts like the one being negotiated now and scheduled to come into effect in 2005.

From heart drugs to chemotherapy, essential medications represent the fastest growing expense in health care today. In the past 15 years, from roughly 1987, Canada's prescription drug bill has jumped by 344% according to a study last month by the Canadian Institution for Health Information.

There are many reasons for the increase. As the member for St. John's West indicated, new drugs have been approved for everything from arthritis to Alzheimer's, adding to the total drug bill. We recognize demographically that an aging population is demanding and requiring more essential medication. International trade deals like the agreement on trade, related aspects of intellectual property rights, or TRIPS as it is known by its acronym, have strengthened the patent protection enjoyed by big name pharmaceutical companies.

The TRIPS deal has allowed these companies to keep their prices high for the 20 year lifespan of drug patents. It has helped pharmaceutical companies net unbelievably high profits on billions of dollars on research into new medicine. The argument goes that without the profits derived from those patents innovative medicine would languish. I do not think there can be much doubt.

Scott Sinclair, a trade policy analyst, put it well when he said that there was no coincidence escalating drug costs occurred during this period of excessive patent protection. He went on to add that 20 years was a very long time, particularly when we are talking about access to essential medications.

Other comments were made by Médecins Sans Frontières and Dr. John Foster, a principal researcher at the North-South Institute. They are also very concerned and urge the countries in the free trade area of the Americas agreement not to bow to pressure from pharmaceutical companies to strengthen further drug patents.

According to some of those opposed, pharmaceutical companies are not interested in making drugs that help poor people, and most of the people in the world are poor. They say that it is a matter of political will that we can put solutions in place but political will is very weak from what they have seen. We in this caucus would certainly agree with that.

There are members on the government side who were on the opposition benches 10 or 15 years ago. It is a veritable who's who. In some of the time I have remaining I would like to make some reference to them. The Minister of Industry, as member for Humber—St. Barbe—Baie Verte, talked about the changes that were brought in by the Mulroney government. He asked this question:

Are they really serious when they say that the sick, the poor, the elderly, and those who live on fixed incomes have to subsidize R and D in Canada?

Are they really serious when they say that the only way the universities, the post-secondary institutions, the centres of excellence of Canada will have any money for R and D is if we take it out of the pockets of Canada's senior citizens and Canada's sick.

Those were comments of the Minister of Industry, the minister who is piloting the legislation through the House of Commons.

[An hon. member]

What a disappointment.

[Dick Proctor, NDP, Palliser, SK]

Indeed, what a disappointment. The current government House leader, the member for Glengarry—Prescott—Russell, read into the record on November 16, 1992, a stack of postcards. He guesstimated them to be four or five inches thick. One postcard read:

“On June 23, 1992, the federal government introduced Bill C-91, legislation intended to extend retroactively to December 20, 1991, patent protection for brand name pharmaceuticals and eliminate Canada's system of compulsory licensing. This legislation will result in significantly higher drug prices in Canada and its retroactive provisions will cripple the Canadian owned generic pharmaceutical industry”. This is not what I said. This is what hundreds and hundreds of Canadians have said.

He used to care. That was then and now it is another day.

The current Solicitor General of Canada, the member for Cardigan, also entered the debate at that time and quoted from Green Shield. He said:

The average cost of a prescription claim has risen at a rate in excess of 11% compounded annually for the period 1987 through 1991, well above the CPI rate.

The Minister for Veterans Affairs and Western Economic Diversification, the member for Saint Boniface, said:

When I talk about Canadians who will need assistance with drugs and medicine, I am of course referring mainly to seniors. Except in rare cases, the need for medical attention tends to increase as we grow older. I suggest it is unfortunate that legislation such as this be allowed to cause hardship to the elderly.

There are those who are sick often, sometimes over the course of several years, and who will require medicine during most of their lives. Costs are already prohibitive. We suggest, and there is evidence to back this up, that they will only go higher with this legislation. I find it is absolutely irresponsible on the part of this government to go ahead with this

He wound up his diatribe against Bill C-91 by saying:

—I have no choice but to say no to Bill C-91 for those Canadians who will need medication and in particular the seniors and those who have need of medication because of their medical condition.

The chief government whip, the member for Ottawa West said:

I think it is important to reiterate what this bill is all about. It is not about extending patent protection for pharmaceutical drugs. It is about completely eliminating, for the entire 20-year patent period, the right of any generic manufacturer to produce a drug that is under patent and to compete with that drug on the open marketplace.

What is the impact going to be? The impact for Canadians is going to be higher drug costs. Right now, generic drugs being produced while the original is still under patent cost 53 per cent of the cost of the patent drug. That is a saving of 47 per cent for Canadian consumers.

What we have in Canada is branch plant drug companies. We do not have basic research. We do not have the kind of foundation that this country wants to see in this industry that is the most profitable in our economy and it does not deserve the kind of protection that this Conservative government is now proposing to offer.

This bill would limit competition. It says that for 20 years one does not have to compete against anyone else.

She concluded by saying:

If NAFTA tells us what we can and we cannot do to provide health care for Canadian citizens then we do not need NAFTA. That is just one more reason to vote against it.

There was one more dissertation that I would like to acknowledge and that is the member for Kenora—Rainy River currently the Minister of Indian Affairs and Northern Development. The minister said in December 1992:

It is a fact that Americans pay 62% more for prescription drugs than the average Canadian citizen. If we were to follow that through, that means by the year 2010 we will be on a level playing field with the Americans. Our drugs should rise proportionately to the point where we will be equal to the Americans as far as the price that we pay for drugs.

The question has to be asked in this place. That is why we are debating this, not because we are the loyal opposition and we disagree with the legislation. It is our responsibility, as members of parliament, to put the facts before the Canadian people so that they can decide whether the legislation that the government is presenting today is a good piece of legislation for the good of all Canadians.

We have the minister who negotiated the free trade agreement and is now the Minister of Industry negotiating on our behalf another agreement, the legislation we are talking about. His negotiating skills are what we are talking about today. The minister of Indian affairs also said:

—Canadians, as consumers, are going to give up roughly $4 billion out of their pockets for higher drug prices because now what we are talking about is going from the Canadian system to a level playing field similar to the American system.

We can see from that lineup that this is one reason we are very concerned about it. The flip-flop by the Liberals on this issue is absolutely breathtaking.

In Canada today we spend more on drugs than on doctors. Prescription drug costs are the fastest growing cost of health care forcing provincial and territorial governments to pay more, causing fewer families to be able to afford the drugs they need.

I had the opportunity on Saturday night to hear from a well known physician in the Saskatoon community, Dr. John Bury, who was talking about the impact that prescription drugs have had. He recalled the drug benefit plan the Saskatchewan government put in place many years ago that worked so well for such a long time. Essentially it was eroded because the government in the early to mid-1990s could not afford to continue as drug prices increased by the 344% that I talked about earlier. His point now is that there are people in Saskatoon who are unable to afford to purchase drugs. Drug prices have risen so much they are now out of the reach of many ordinary and poorer Canadians.

A personal friend of mine is in hospital recovering from a stroke brought about, almost certainly, by the fact that she neglected to have her blood thinners upgraded or the prescription renewed. In some ways we are putting additional costs on our medical health system by examples such as that.

In a country with $100 billion to spend on tax cuts, one in ten Canadians do not fill prescriptions because he or she cannot afford it. Since 1990 drug prices have risen by 87%. If drug prices are not brought down increased health funding will not go to patients but to multinational pharmaceutical companies.

Public health care needs to get its fast rising costs under control. Families need lower prices to afford the drugs they need. However that is not what the government has been offering. It chose to break promises it made as recently as 1997, let alone in 1987 and 1992 in its red book on a national pharmacare plan. It chose to ignore new ideas for health care like a national bulk buying project that would bring costs down. I note that Australia has such a program.

It chose to keep Mr. Mulroney's drug patent law, Bill C-91, which provides for longer patents. When in opposition, the Liberals promised, as I have tried to point out in my speech, to rescind the law. The Liberal government chose to support more powerful trade agreements even though these agreements make it harder for Canada to use cheaper generic drugs. It chose to accept one trade ruling that made it harder for Canada to use cheaper drugs.

All of this leads me to recall the old Irish proverb, and we have seen it time and again over the years since Confederation, “You can vote for whichever party you want but the government always wins”.

[Pat Martin, NDP, Winnipeg Centre, MB]

Mr. Speaker, I thank the member for Palliser for a very good speech. I learned a great deal, and I know that all who are listening here and at home probably benefited as well from the historical references that the hon. member made about what those who currently sit on the government side felt about Bill C-91, the drug patent protection act, when they were in opposition.

I would like to point out that I come from the third poorest riding in all of Canada. I know personally of stories brought to my office of senior citizens who actually cut their pills in half to make their medications last longer because they cannot afford, on a month to month basis, the drug prices for the regime their doctors have given them.

Given that we know this to be true, and it is not the first time it has been raised in the House, one would think that the bill we would be debating today would be some kind of intervention by the government to advocate on behalf of those people and to put in place changes in the system that might champion this issue. One would think the government would advocate on behalf of those seniors who are having such a difficult time. Rather, we are seeing what has been called the greatest corporate giveaway in Canadian history, Bill C-91, augmented, added to and made even worse by Bill S-17.

Would the hon. member give us some indication as to whether he has heard stories of senior citizens struggling to cope with the costs of their monthly medications? Would he not agree that there is something completely ass-backwards having us debate a bill that will actually make the situation worse rather than having a proactive government intervene on behalf of Canadians to try to remedy this terrible situation of rising drug prices?

[Dick Proctor, NDP, Palliser, SK]

Mr. Speaker, I thank my colleague for the question, and yes, I think all of us in the House could probably point to examples of people who have diluted their prescription drugs in order to make them stretch a little further. Sometimes that can complicate their health and well-being. Instead of helping, it often adds to their difficulties.

What my colleague is talking about is the need for a concerted effort by government to campaign for cheaper medicine. Some countries, and the name of Brazil has come up a couple of times today, have basically thumbed their noses at the multinational drug companies and have said that they will do something, that they will provide drugs for people who are victims of HIV and AIDS. The South African example has been instructive on that topic as well. These are the sorts of things and the kind of leadership we are looking for.

In the case of South Africa, the decision of the drug companies to drop the case amounted to a huge victory for millions of people who are suffering from treatable diseases. It is all well and good to talk about being on the leading edge and coming up with drugs that will cure very nasty and lethal diseases. However, if the vast majority of people in the world can in no way afford to buy those kinds of drugs, what does that say about a public health care system such as the one that has been pioneered in Canada over the years? It was pioneered first by the CCF and then by the New Democratic Party in Saskatchewan and extended to the rest of Canada.

I think Canadians are desperately looking for leadership in this area and the drug patent protection of 20 years is not the way in which most of them want to see the country continue.