Debates of Nov. 2nd, 2007

Aeronautics Act

[Libby Davies, NDP, Vancouver East, BC]

Mr. Speaker, the hon. member for Western Arctic has made some very fine remarks today. He and other colleagues in the NDP have put forward some of our very serious concerns about this bill and I think the member has brought some of his personal experience to this debate, which I think is a very legitimate thing to do.

I would like to ask the member if he is concerned at all about the fact that this bill, as well as moving to a separate safety management system outside of Transport Canada, is moving to a separate system for purposes of fatigue risk, which is the amount of time employees are working on the job. As I outlined in debate earlier, there is concern about the distance from the Canada Labour Code that is being created with this bill. Would he comment on that?

[The Acting Speaker, Conservative, Royal Galipeau]

The hon. member for Western Arctic, although he has nine minutes left, should know that there is only one minute left today.

[Dennis Bevington, NDP, Western Arctic, NT]

Mr. Speaker, I just want to mention that the working conditions for mechanics and for technicians on aircraft vary considerably across the country. I have seen mechanics out working with Herman Nelson heaters under tarps when fixing aircraft, because of course their airlines do not have the luxury of a heated hangar.

These are people who ensure that aircraft fly at all times of the day and night in very bad conditions. I grew up with many of them and my heart goes out to them because they are sincerely trying to do the best job. However, when I spoke to them about this bill, they all had serious concerns. When I spoke to senior mechanics about the nature of this bill, they said no to it.

[The Acting Speaker, Conservative, Royal Galipeau]

It being 1:30 p.m., the House will now proceed to the consideration of private members' business as listed on today's order paper.

When Bill C-7 returns to the House, there will be eight minutes left under questions and comments for the hon. member for Western Arctic.

Food and Drugs Act

[Carolyn Bennett, Liberal, St. Paul's, ON]

moved that Bill C-378, An Act to amend the Food and Drugs Act and the Food and Drug Regulations (drug export restrictions), be read the second time and referred to a committee.

Mr. Speaker, I am pleased to have the opportunity this afternoon to discuss with my colleagues from all parties Bill C-378, An Act to amend the Food and Drugs Act and the Food and Drug Regulations (drug export restrictions), although I wish that I did not have to do this bill again. It would have been very simple for the government to deal with this during the prorogation and actually make this bill unnecessary, but it still refused to act.

My bill is aimed at controlling the cross-border trade in prescription drugs and vaccines. The bill would amend the Food and Drugs Act to prohibit the export of drugs set out in schedules D and F to the Food and Drug Regulations, vaccines and prescription drugs, except as permitted under the regulations.

The bill would make it an offence under the Food and Drugs Act to export prescription drugs in prohibited circumstances. By amending the Food and Drugs Act, the legislation will protect Canadians.

My bill is constructed to protect the Canadian pharmaceutical supply from being bulk-exported south of the border. There is such a large price differential between American and Canadian pharmaceutical prices that there is great pressure on the U.S. at this time to import cheaper drugs from Canada.

With over 35 million members, AARP is the leading non-profit, non-partisan membership organization for people aged 50 and over in the United States. It wields an enormous amount of power and is at this time launching a very major communication initiative.

However, during my meeting with the organization in Washington in the spring, it was clear that its real intention was not to import pills from Canada but to import prices from Canada and to make Americans very angry that they were paying too much for brand name prescription drugs.

Let me put it plainly: Canada cannot become America's discount drug store. Canada needs to protect itself from the dramatic expansion of importation by the U.S. of drugs intended for our patients.

The prospect of the U.S. legalizing large-scale purchases from our domestic supply is real. In fact, every Democratic Party presidential candidate is in favour of importation legislation.

The threat to Canada's drug supply increased on January 10 of this year after some U.S. politicians stepped up their efforts to facilitate bulk imports of prescription drugs from Canada with the introduction of the pharmaceutical market access and drug safety act of 2007.

The legislation was introduced by Senators Dorgan and Snowe and Representatives Emanuel and Emerson, who are co-sponsoring the companion house legislation. The legislation, which has the backing of key U.S. Democrats and Republicans, would allow individuals to directly order medications from outside the U.S. It would allow U.S. licensed pharmacists and wholesalers to import FDA-approved medications from a number of countries, including Canada.

In May, senators both approved the measure and then voted to require U.S. health authorities to certify drug imports were safe. Since the U.S. federal drug administration already had made it clear that it would not provide certification, the bill was dead on arrival.

However, on Wednesday, the U.S. Senate adopted U.S. Senator David Vitter's drug reimportation amendment to the U.S. Senate labor, health and human services and education department appropriations bill. In addition to foot traffic, Vitter's amendments would also allow mail order and Internet importation for Canada.

Several steps remain in the U.S. Congress before such a bill is signed into law, but influential lawmakers are on the march on this issue. It is like a voodoo from a video game: it just will not be killed.

In addition, the House budget office has recently completed a budgetary impact analysis demonstrating the savings that would follow the adoption of importation legislation. The announcements will give additional incentives to pass legislation in the context of the budget negotiations.

Any of these measures pose an imminent and serious threat to the security and integrity of Canada's drug supply and a genuine threat to the health of Canadians. It may have been good short term politics, but it is terrible long term policy.

American seniors are rightfully outraged by the high prices of pharmaceuticals in their country, but outsourcing price controls is not a responsible approach. In Canada, we have addressed price control with the Patented Medicine Prices Review Board, which regulates drug prices to ensure that the prices of patent-protected brand name drugs are not excessive.

Canada has regulated drug prices for the past 15 years. The United States does not have a similar control mechanism and the problem is exacerbated by U.S. drug companies spending millions of dollars every year to defend their higher prices.

Every year U.S. drug companies spend hundreds of millions of dollars on political influence, including lobbying, campaign donations, and extensive ad campaigns to defend their high prices and fight against price control. The American drug industry employs over 600 lobbyists in Washington alone, more than one for every member of Congress. This system drives U.S. prices even higher.

Another important difference between the Canadian and American systems is the regulation of advertising.

Prescription drug advertising is one of the most controversial practices in the American pharmaceutical industry. During the first nine months of 2002, American pharmaceutical companies spent over $6 billion promoting their products to physicians and consumers. This kind of advertising drives prices up and is prohibited in nearly all other western countries.

In Canada, the therapeutic products directorate strictly regulates prescription drug advertising.

I would also like to discuss how drug importation legislation represents a threat to American patients by allowing relinquishment of necessary community-based medication monitoring and management at increasing risk for potential counterfeit drugs.

The incidence of counterfeit drugs is small, but is growing in developed nations. The recent tragic death of a British Columbia resident, determined by a coroner to have been caused by counterfeit medicine in her possession, serves as a reminder that North America is not immune from this global phenomenon.

The counterfeiting of medicines is an issue that threatens the quality and integrity of Canada's drug supply, a problem that will be greatly exacerbated if U.S. drug importation legislation is passed into law without a clear and effective Canadian prohibition on bulk drug exportation.

I was pleased to see the public safety committee's report, entitled “Counterfeit Goods in Canada--A Threat to Public Safety”, which included this recommendation:

--that the Government of Canada institute a campaign to raise awareness of counterfeit and pirated goods to make the public aware of the economic and social costs associated with this scourge, and emphasize the public health and safety hazards they represent. The campaign should also raise Canadians' awareness of the involvement of organized crime in the counterfeiting and piracy of goods.

Internationally, the WHO is very concerned about counterfeit drugs. The WHO has struck the international medical products anti-counterfeiting task force, tasked with increasing international collaboration to combat counterfeiting.

I would also like to point out that allowing bulk prescription drug imports would not significantly reduce U.S. prescription prices for very long.

Even a recent University of Texas study concluded, based on the worst case scenario, that Canada's stocks of prescription drugs would amount to about a 38-day supply for the United States, assuming all U.S. medications were Canadian sourced. Once U.S. demand depletes Canadian stocks, prices will almost certainly rise, narrowing or even possibly eliminating the difference between U.S. and Canadian pharmaceutical prices.

Some may argue that Canadians should just increase manufacturing of pharmaceuticals to meet the U.S. demand.

Canada's innovation-focused pharmaceutical industry develops, manufactures and distributes drugs designed to meet the needs of Canadian patients and the Canadian market. It bases its production on the size of the population and the incidence of the illness or condition to be treated.

Manufacturers produce sufficient prescription drugs to meet the expected national demand. Consequently, if one country imports its prescription drugs from another, it diminishes the exporting country's stock of drugs to meet the needs of patients in that country.

Labelling regulations also differ from country to country. As a result, prescription drugs produced for the American or South American markets cannot just be sent to Canada to meet an unexpected need.

Given the complexity of calculating annual estimates of the needs of Canadian patients, not to mention the management by drug companies of their inventory to respond to patients' needs, it is unrealistic to think that products manufactured for Canada could meet American demand.

Cross-border trade is not only detrimental from a public policy perspective, it is almost virtually impossible to do. I would like to underline again that Canada cannot meet the prescription drug needs of approximately 280 million Americans without putting our own supply at risk.

Take, for example, the events during the fall of 2005, when in November Roche Canada took the unprecedented step of suspending sales of Tamiflu to the Canadian market. There were reports that Internet pharmacies were busily filling foreign prescriptions at a significant profit. One B.C. pharmacy alone was reported filling 400 orders a day from the U.S. That is a significant number, when according to the Canadian Pharmacists Association only 4,000 Canadians received that drug that September. Another Internet pharmacy in Montreal issued news releases promoting to U.S. customers its Tamiflu stocks.

The Canadian Pharmacists Association reacted to the Tamiflu incident by saying that the government should have acted to protect the country's supply of the drug. Again, when supply gets siphoned off to the U.S., it is Canadians who come up short.

This situation is a perfect example of the types of scenarios Canadian patients will face if Canadian governments continue to allow drugs to be diverted to the U.S.

This is not an issue unique to North America. In April of this year the European Union passed resolution 31 stating:

Is concerned about the intention of the US Congress to authorise parallel imports of medicines from the EU Member States, that may create obstacles to the EU patients' supply and favour counterfeiting of medicines; asks the EU, therefore, to raise this issue at the forthcoming Summit;

I would also like to take the opportunity to commend my colleague, the member for Vancouver South, who in 2005, when he was health minister, anticipated this problem and put forward legislation, Bill C-28, in order to reach consensus in the House. Unfortunately, an election was called before the bill went forward.

Current Canadian policy is to use only reactive measures and seek to manage shortages once they have already occurred. This is not enough and it may well be too late.

The issue of bulk exports to other countries of medicines and vaccines destined to Canadians should be an issue of concern to all of us. It is of particular interest to the Canadian Pharmacists Association and the Ontario Pharmacists Association.

I believe the passage of Bill C-378 is essential to protect the supply and integrity of prescription drugs here in Canada and will send a strong message to our American colleagues of the futility of their shortsighted legislative initiative.

I urge all colleagues to support my private member's bill, Bill C-378, or to call upon the government to make it unnecessary.

[Steven Fletcher, Conservative, Parliamentary Secretary for Health]

Mr. Speaker, I listened to the member's comments with interest. I note that her comments began by criticizing the current government. I find this very hypocritical because when the issue of drug exports from Canada to the United States was at its peak, it occurred under the previous Liberal government, a government in which the member was a minister.

The peak was in 2004 and the former minister of public health and the former health minister did nothing at that time. The peak flowed by and they continued to do nothing. The member mentioned that the Liberals brought forward a bill. Not only was it poorly worded and unnecessary, it just again showed how the Liberal Party was all talk and no action.

At the time, in 2004, it should also be noted that the Canadian dollar was in the 70¢ range. Today it closed at over $1.07. So a lot of the economic benefit has been eroded due to the increase in the Canadian dollar.

Moreover, the Internet pharmacy business has collapsed. As far as the U.S. regulations are concerned, the White House opposes the bill, Congress is dividing. It has little chance of passing and even if it does pass there is a poison pill within the bill.

Canadian drugs are not under threat today and it is really a lot less under threat than they were under the Liberal regime when the Liberals did nothing. If this member is so concerned about the issue, why did she not do something in the 13 years that she was in government in 2000 or 2001? Why is she raising it now?

It is just another example of Liberal hypocrisy. That is my question: why now and not then?

[Carolyn Bennett, Liberal, St. Paul's, ON]

Mr. Speaker, I am shocked that the member opposite does not understand the gravity of the situation right now.

The Liberal government did act and the former minister of health did table a bill when it seemed there could be problems, particularly with respect to pandemic preparedness and shortages in flu vaccine like Tamiflu. The bill was tabled and even the Conservative member, who is a former chair of the health committee, actually supported the bill at that time.

It is the ultimate in hypocrisy to say, “How come you did not do then what clearly needs to be done now?”

It has been the political climate in the United States, the pressure from the bills before Congress and, indeed, the endorsement of all presidential candidates now that puts the drugs supplied by Canada under severe risk and Canadians at severe risk from the kind of counterfeit drugs that would come to backfill the shortages.

The price of the Canadian dollar is indeed different, but the idea that we in Canada have for 15 years properly controlled the price of patent medicines in this country is really the risk.

Even today, the costs of patent medicines are very much cheaper in Canada than the United States, and they are still an incentive for Americans to import cheaper drugs from Canada. Why would the Senate and Congress of the United States still be wanting to do this, as the member was suggesting, if indeed the problem was just the price of the Canadian dollar?

This is a huge threat to our country. We need the minister and the government to act. I do not think Canadians are too amused by the hypocrisy of saying that the previous Liberal government did nothing when we actually tabled a bill and the present government is so stubborn that it refuses to bring it forward, even though it knows it is necessary.

[Steven Fletcher, Conservative, Parliamentary Secretary for Health]

Mr. Speaker, I would like to take this opportunity to outline some of the key factors to consider with respect to cross-border drug sales.

First, let me just touch on some of the comments the member just made. The peak of the cross-border drug sales occurred many years before the bill to which the member referred was tabled. If the previous government had been really serious about dealing with the issue, it would have dealt with it at that time.

The political climate in the United States is actually quite contrary to what the member is suggesting because there is very little likelihood that the bill will actually pass.

Let me go into some other aspects. I hope to usefully inform the hon. members as to the current status of the issue, and how and to what extent this affects the interests of Canadians.

Let me begin by saying that the sale of Canadian prescription drugs to Americans is by no means a new practice. For years a limited number of Americans in border states have crossed into Canada to obtain prescription drugs from Canadian physicians, so that they could fill their prescriptions at lower Canadian prices. This activity is referred to as cross-border foot traffic.

Until recently, the number of individuals purchasing drugs from Canada was limited by the physical distance to the U.S. patient's place of residence and our clinics and pharmacies, not to speak of the need to cross the border. This foot traffic has been relatively stable at about $500 million a year.

In contrast to foot traffic, cross-border Internet pharmacy transactions are a relatively new phenomenon ushered in with the advent of Internet commerce.

The introduction of the use of the Internet to facilitate prescription drug sales significantly lessened the importance of the border as a barrier to sales. Internet pharmacy transactions went through an initial rapid growth and then a dramatic recent decline.

The sales volumes were small in 2001, at about $70 million, but grew tremendously to $840 million per year in 2004, when the Liberals were in power, at a growth rate of over 1,100%. Combined with border foot traffic, total sales to the U.S. amounted to approximately $1.35 billion in 2004.

The majority of the Internet pharmacy industry has been concentrated in the western provinces, particularly in Manitoba. In 2004, Manitoba accounted for nearly $400 million in annual Internet pharmacy sales representing close to half of the industry's business.

Other provinces with a strong industry presence have included Ontario, British Columbia and Alberta. These four provinces have consistently combined to account for more than 95% of the Internet pharmacy activity.

As well, at its peak it has been estimated that the Internet pharmacy industry has been a source of employment for up to 4,500 people.

Internet pharmacy sales peaked in 2004 at a value of $840 million, but annual sales decreased by 25% from 2004 to 2005 and there was a further reduction of about 50% in 2006. Presumably there will be another huge reduction given the rapid appreciation of the Canadian dollar.

The drop in sales volume is due to many factors, including the introduction of a drug benefit for seniors under the U.S. medicare program. The decline in sales has been most pronounced in Manitoba, originally the largest volume Internet pharmacy province.

It is important to note that when the Internet drug sales to the U.S. were at their peak in 2004, there was no evidence of any impact on the Canadian supply.

It is not unreasonable to think that a three-quarter drop in sales would equate to a similar drop in the potential impact on the Canadian supply, but some members are suggesting that the risk to the Canadian supply is rising. This is very difficult to understand.

Cross-border drug sales, including both Internet and foot traffic sales, now amount to about $700 million per year. At the peak of the Internet sales, the total sales volume was $1.3 billion.

In the meantime, proposed U.S. legislation to legalize drug imports, bulk imports in particular, has the potential to impact on the volume of drug exports from Canada to the United States, but for reasons that I will explain in a moment, it is, I believe, highly unlikely that that situation will materialize.

In evaluating the risks for the Canadian supply, it is useful to have a good understanding of the underlying drivers of cross-border drug sales to the United States. The primary motivating factor is drug price differentials between the two countries.

For patented drugs, Canadian prices can range from 35% to 55% below those paid by Americans. This is in large part due to the fact that Canada has legislated the price of patented drugs. The federal Patented Medicines Prices Review Board was created in 1987 under the Brian Mulroney government through the Patent Act with the regulatory mandate of ensuring that patented drug prices in Canada are not excessive.

Combine our lower prices with those Americans who have only partial or no drug insurance and we have a market. There is also interest from smaller drug plans without significant negotiating power with drug manufacturers.

However, overall demand has been reduced dramatically in the last couple of years. This is primarily due to the introduction in the United States of Medicare Part D, which provides drug benefits for seniors and others, such as disabled Americans who previously were under-insured or uninsured.

State governments and many municipalities are also involved. Drug importation is effectively prohibited under U.S. federal law, with the exception of a 90 day personal import provision, but despite the legal considerations, the import option has received significant support from state and municipal governments. A number of states have considered, or in some cases, actually pursued some sort of state facilitated drug import program. That said, such activity seems to have also been moderated by the medicare drug benefit.

In the case of municipalities, the interest has been either on behalf of their own municipal employees or their residents at large. Many of these initiatives have been launched despite warnings from the U.S. Food and Drug Administration of possible contraventions of federal law.

Clearly, this level of interest in drug imports would not exist if Americans were not facing the twin problems of high drug prices and inadequate or non-existent drug coverage. However, I believe that any concern about impacts on the Canadian drug supply needs to be balanced with a calm and considered examination of the situation.

First, the Americans are looking at solving this issue domestically.

Second, a number of factors have combined to dramatically reduce the volume of Internet based cross-border drug sales, including Medicare Part D and the rising Canadian dollar.

Third, imports of prescription drugs via Internet pharmacies are officially not permitted in the United States and we have not seen the floodgates open as a result. In fact, there was a sharp decline in the last quarter of 2006 of 20% of cross-border shipments due to U.S. customs.

Fourth, despite recent changes in the makeup of the U.S. Congress, we are a long a way from a bill legalizing bulk imports being approved by the White House without such a bill including major impediments to actual imports in practice. In other words, the White House does not support the importation of drugs and therefore, the bill would have very little chance of passing.

The Canadian drug supply is safe. There is no danger in the short, medium or long term. This bill is not necessary and therefore, I do not support it.

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Mr. Speaker, I would like to thank the member for St. Paul's for her speech. I understand that the purpose of the bill she introduced today is to make it possible to prohibit the export or sale of prescription drugs and medications set out in a schedule to the Food and Drugs Regulations. There are currently no drugs listed in the schedule.

The bill has two specific goals. The first is to establish the principle that exporting any drug listed in the schedule should be prohibited if such activity could compromise the supply of that drug in Canada. The bill's second goal is to make it illegal to export prescription drugs. Bill C-378 is a kind of insurance policy against bulk exportation of prescription drugs in case of shortages in Canada.

To better understand the issue, we need to look at the pricing mechanisms for prescription drugs. In the United States, the power to set prices for prescription drugs is in the hands of pharmaceutical corporations. They can price their products as they see fit. Under pressure from American lobbyists, the Bush administration allows the pharmaceutical industry complete freedom to set its prices.

In Canada, except in Quebec, the Patented Medicine Prices Review Board, the PMPRB, which was established in 1987 in accordance with the Patent Act, sets maximum prices for medicines. The PMPRB is responsible for protecting the interests of Canadian consumers by ensuring that prices charged by manufacturers for patented medicines are not excessive.

Quebec has its own drug review process, the Conseil du médicament. The drug policy includes measures to ensure that Quebec is paying fair and reasonable prices for drugs.

It would be interesting to find out why the price difference is so big that Americans want to buy their medicines in Canada. Because prices in Canada are fixed by independent agencies, prices for identical products are often 30% to 60% lower here than in the United States.

It was pointed out earlier that the price of prescription drugs exported to and paid for by Americans fluctuates according to the value of the Canadian dollar. As the Canadian dollar rises, Canadian drugs become less profitable and attractive to Americans. Today the Canadian dollar was trading at $1.07 U.S., or 7% higher than its U.S. counterpart.

So how can we ensure the security of supply for Canada? Cross-border sales of pharmaceuticals to the United States have become an important source of trade for Canada. Since the Americans can take advantage of lower prices here than at home, they try to stock up in Canada. The potential is considerable, given that 37 million people aged 55 and older want to buy their pharmaceuticals here.

According to the Ordre des pharmaciens du Québec, the on-line pharmaceutical market has reached over $1 billion a year in Canada. Although all Canadian pharmacies must obey Canadian laws, the legislation is not airtight everywhere. While on one hand, the federal government has the authority to legislate exports, on the other hand, the provinces and territories are responsible for regulating medical and pharmaceutical practices through, in Quebec, the Collège des médecins and the Ordre des pharmaciens.

Thus, trade is particularly lucrative in Manitoba, where the laws surrounding the sale of pharmaceuticals are more flexible. According to estimates by a company called Secor, in 2003, nearly 20% of pharmacists in that province worked mainly to sell to Americans. That was the infamous peak year that was mentioned earlier. Also according to the same source, the majority of pharmacists in Canada who sell to the United States happen to be in Manitoba.

The Canadian Pharmacists Association warned of the following:

Canada needs to protect itself from having our drug supply drained, which will occur if the US passes this legislation. The cross border drug trade does not appear to be on the agenda of the current [Conservative] government. We believe that acting only after US bills are passed and Canadians are experiencing drug shortages is not an adequate response on the part of the Canadian government. The government will have to act sooner or later – and sooner is preferred. An important first step would be to pass Bill 378.

In Canada, neither international trade obligations nor domestic law prohibit such exports. However, Quebec and the provinces must follow rules with respect to these export transactions. Someone can speak about Ontario, but I will limit myself to the situation in Quebec.

As in so many other areas, Quebec is way ahead in terms of monitoring sales of prescription drugs and has taken steps to prevent the online sale of prescription drugs to Americans.

Under the Pharmacy Act, a pharmacist can sell drugs only to patients who have prescriptions written by a person authorized under Quebec legislation or the legislation of a Canadian province that authorizes that person to prescribe that drug if that person practises in Quebec.

The Quebec Code of ethics of physicians stipulates that in order to write a prescription for a patient, a doctor must evaluate the patient, establish a diagnosis, formulate a treatment plan, provide information to the patient and obtain consent. Some Quebec doctors have already been struck from the Collège des médecins du Québec for illegally selling drugs on the Internet to Americans they never met. I have with me a newspaper article that mentions the name of four such doctors who were fined between $5,000 and $25,000, in addition to being banned from practising for six months for signing prescriptions for U.S. patients without meeting them. I was quite surprised to see the name of a doctor from my riding on that list of four doctors. They operated on the Internet at myprescription.com, which means that Internet pharmacies are right next door.

Physicians practising in Quebec are not allowed to countersign a prescription from another physician without complying with the requirements that apply to the prescription. A Quebec physician who countersigns a prescription from an American physician therefore risks being sued, not only in Quebec, but also in the United States.

In terms of online business, Quebec already has the necessary tools to protect pharmacies' supply and ensure that patients receive the appropriate medication for their condition and information on how to use it properly.

In conclusion, the Bloc Québécois supports Bill C-378 in principle. The bill answers concerns about the possible reduction in inventories of drugs meant for Canadians. Although there is no shortage at present, we need to look at preventive measures before such a situation occurs. By setting strict criteria to regulate bulk drug exports, Bill C-378 would prevent an unfortunate situation from arising.

The bill should reassure the pharmaceutical industry and prevent it from raising drug prices, as American companies were tempted to do in retaliation.

The bill does not place a total ban on drug exports. It provides for a mechanism based on known criteria that can be produced in evidence.

[Peggy Nash, NDP, Parkdale—High Park, ON]

Mr. Speaker, I am pleased to speak to the bill, which is aimed at protecting the Canadian pharmaceutical supply from bulk exports south of the border.

Canadians need to have a secure supply of the pharmaceuticals they need. This is not to say that we do not understand that the health care system south of the border leaves much to be improved. More than 50 million Americans have no health coverage. Many other Americans have substandard coverage in the sense that they think they are covered by health care insurance, but when they become ill, they find out their hospital stay or drug coverage is not there to protect them.

We understand the need. Americans have been facing very high drug prices. That is why Canadian pharmaceutical companies have been appealing to Americans who have been accessing bulk exports of Canadian pharmaceuticals.

We do not want to be locked into a path where the security of supply for export supercedes the security of supply for Canadians. When Canadians need pharmaceutical drugs, whether for catastrophic care, or for an epidemic or pandemic of some kind, we need a policy to ensure we have the security of drugs we need. While we recognize the situation of Americans, the bulk export of Canadian drugs is not the solution.

My colleague, who introduced the bill, has explained that there are many drawbacks to relying on Canadian bulk exports, such as the scarcity of some ingredients that limit the amount of supply needed for some drugs. Many of them are time dated, so they cannot be stockpiled in a warehouse somewhere in case they might be needed by our neighbour south of the border.

We know what happens in a time of scarcity. During the SARS crisis a few years ago in Toronto, there was a great deal of panic about the cause of the epidemic and a great concern about how people could protect themselves from the spread of this disease. In a situation like this there is always the danger of hoarding. People will do what they think is in their best interests to protect themselves and their families. Some people also hoard because they think they can make some business from this situation. If there is a crisis situation, we want to ensure that Canadians will have access to the drug supply they need.

We also know there have been problems with counterfeit medications. Our border inspectors do not inspect every shipment that goes across the border. I have heard that 1% of shipments are physically inspected. This then leaves open the possibility of counterfeiting, which not only endangers the health of Americans, it also diverts production that could be put to beneficial use rather than counterfeit use.

It is important to safeguard the Canadian supply and to avert going down the path where we open ourselves or our neighbours to the south to the risks of bulk drug exports. The Government of Canada must do what is necessary to ensure that Canadians are protected.

I also want to speak about drug coverage in Canada. While Americans may think we have a more desirable situation here, because of lower drug prices, primarily through generic brand pharmaceuticals, we also have a problem with drug prices on this side of the border.

The drug patent laws have been giving brand name pharmaceutical companies more and more patent protection over the years. The Conservative government extended patent protection up to eight years now for brand name drugs. This will see hundreds of millions more dollars of costs added to our pharmaceutical costs in Canada. We also have the problem of evergreening of drugs under patent protection, which has not been addressed.

What it means is higher drug costs for Canadians. They are so costly that in fact many Canadians simply cannot afford to have their prescriptions filled as it stands today. It adds to the financial stress that many Canadian families are under. We can all imagine the situation of people who go to a drug store to fill their prescriptions. They find out the price and they simply cannot afford to have the prescription filled, which would help them regain their health.

It is time Canada had a national universal drug plan to promote better health for Canadians without breaking the bank. We have an opportunity while we have surplus budgets, surplus funds federally, if the government does not give it all away to the banks and the oil companies, to invest in Canadians. We can pool our resources to bulk purchase drugs for Canadians. We could do that through a universal pharmaceutical program.

We have seen with our universal health care program, medicare, that our costs are far below costs south of the border, by pooling our resources and ensuring that everyone is covered, rather than leaving too many people behind.

The government has dropped its promise to deal with wait times when it comes to health care. That has been a shameful oversight. Here is an opportunity for the Conservatives to introduce something positive with respect to health care, and that is a national pharmacare program.

An important step is to secure our supply of drugs for Canadians and to ensure we do not export drugs south of the border that could jeopardize supply in Canada. I believe a more fundamental, an important step and a necessary step for Canadians is to ensure they all have access to the pharmaceutical drugs they need. We have to keep costs down as a country. I believe a national pharmacare program is long overdue. It would make a huge difference for Canadian families.

[Wayne Easter, Liberal, Malpeque, PE]

Mr. Speaker, this bill is about one simple thing. It is about meeting the needs of Canadians who want to feel secure that their prescription drugs and vaccines are there for Canadians. Let me re-emphasize that. This bill talks about security of supply of drugs and vaccines for Canadians.

I will not get into a lot of the technical details of the bill. The member of Parliament for St. Paul's went to great lengths to explain some of the technical details of the bill, but I want to talk about it in layman's terms.

I congratulate the member for St. Paul's for bringing forward this bill. Previously she was a minister of public health and therefore she understands the needs of Canadians on the ground. She is a medical doctor and therefore she knows first hand how important it is that Canadians are able to get not just drugs, but the most recent drugs, the most effective drugs in terms of meeting Canadians' needs. This bill is about meeting Canadians' needs.

Bill C-378 is about Canada not becoming America's drugstore. By amending the Food and Drugs Act, this legislation would protect Canadians.

The bill would amend the Food and Drugs Act to prohibit the export of drugs set out in schedules D and F to the Food and Drugs Act regulations, which are vaccines and prescription drugs, except as permitted under the regulations.

The bill would make it an offence under the Food and Drugs Act to export prescription drugs in prohibited circumstances. The exporter would be liable, on summary conviction, to a fine of up to $50,000 or imprisonment for a term not exceeding six months, and on conviction by indictment, to a fine of up to $250,000 or imprisonment for a term not exceeding three years.

Simply put, this bill would push the Canadian government to stand up for Canadians. It is something the Conservative government very seldom does.

We heard in the House today that it is not standing up for a Canadian citizen who is facing execution in the United States. The excuse is that a democratic decision was made in the United States. Canadians have always stood up for human rights. That is why we are respected around the world. How can the government go to China and talk about human rights any more when it is allowing a Canadian citizen to be executed in the United States?

That may be a little different story from this particular drug and vaccine issue, but it is all about standing up for Canadians, and the Conservative government is failing to do it. In terms of opposing this bill, it is clearly not standing up for Canadians.

This bill would push the government to stand up for Canadians, rather than just allow the export of drugs that would enhance American health and ignore the need for Canadians to be absolutely sure that the necessary drugs are available for Canadians. The government is opposing that.

I was shocked when I listened to the Parliamentary Secretary for Health. He went on at great length to say that the White House is opposed to the importation of drugs and therefore, we really do not need to deal with it.

I know the Conservatives love George Bush and love to hug him, but if they would just look a little beyond him to the candidates for the next presidency, they would see that most of the candidates support the importation of Canadian drugs into the United States because the drugs are cheaper.

We can understand why those presidential candidates are doing that. It is because the American health care system does not work. Over 40 million people do not have access to health care. It would be a great cover for the Americans to import cheap Canadian drugs, even if it shorted Canadians in terms of their supply, to kind of cover up the failures of their own health care system.

There is no question that the new government would stand by idly and risk the drug supply for Canadians. This bill is basically challenging the government, the companion of George Bush, to actually stand up for Canadians for a change and protect their supply of drugs and vaccines.

I have to ask this question. How often do we need to have Canadians subsidizing the United States?

The United States is our great friend. I spend a fair amount of time down there and the U.S. is our greatest trading partner. However, I think every Canadian is bothered when they learn that we are exporting oil and gas to the United States, a great Canadian resource, and what it is being used for in the United States. It is a cheaper supply. It is subsidizing its industrial plants so they can compete against Canadian industrial plants with cheap Canadian energy.

Why do we always need to be more supportive of the United States economy than our own? Now the government is going to put Canadians at risk by not being proactive and supporting Bill C-378.

Some will argue, as they always do because they like to use the trade agreements as a great crutch, that this will violate the trade rules. I say to the Government of Canada that if the trade rules do not make sense for Canadians then they need to be challenged. If this bill means there needs be a challenge to the trade rules, then let us challenge the trade rules. That would only make sense because then we would be standing up for Canadians.

The parliamentary secretary raised a number of points. He basically said that there was no imminent drug shortage and that the United States Congress has not adopted legislation to legalize the bulk importation of drugs. That is true for the moment but why can we not be proactive?

The fact of the matter is that the government should be proactive by banning bulk exports to the United States rather than waiting until after shortages of prescription drugs and medications occur.

As a coalition of Canadian pharmacists, distributors and patients said in a letter to the health minister on January 12:

We believe it is incumbent on the Government of Canada to respond proactively to this threat, with actions driven by a commitment to prevent harm and protect the public interest.

Why will the Government of Canada not listen to Canadians, to pharmacists, to distributors and to patients and be proactive? These people are concerned. Instead, the parliamentary secretary takes his advice from the White House. That is unacceptable.

He also talked about the Internet pharmacy sales having decreased significantly in the past two years. We really cannot be sure of that. It is difficult to determine the extent of Internet sales to the United States because many of them are being made offshore.

The bottom line is this. This bill is all about protecting the security of the drug and vaccine supply and medications for Canadians. The Canadian government should be proactive in terms of supporting this bill, even if it means it needs to stand up to the United States in terms of its agenda and its wishes. The government should stand up for Canadians, be proactive and support this bill to ensure that protection is there.

[Nina Grewal, Conservative, Fleetwood—Port Kells, BC]

Mr. Speaker, I am pleased to rise today on behalf of the constituents of Fleetwood—Port Kells to participate in the debate on Bill C-378.

The bill has been proposed as a response to developments in the United States. I think it is important that we understand the U.S. situation before deciding how to address it.

This proposed U.S. legislation to legalize drug imports is motivated by shortcomings in the American health care system. These deficiencies have left a sizeable number of Americans exposed to unmanageable prescription drug costs.

As Canadians, we value social supports and health care that seeks to be inclusive of all Canadians. So, while we are not unsympathetic to the issue of Americans without drug insurance, I think we can agree that importation of Canadian sourced drugs is simply not an adequate solution.

I would like to talk about the important role that prescription drugs play in our health care system.

There can be no denying that drugs have brought tremendous health care advances that benefit all Canadians. However, in addition to protecting an adequate supply for Canadians, we must also be vigilant in ensuring that costs remain manageable.

In recent years, drug costs have accounted for an increasingly large portion of expenditures in the Canadian health care system, with expenditures growing faster than any other component of health care. Drugs are now the second largest expenditure in our health care system.

According to the Canadian Institute for Health Information, total expenditures on prescribed and non-prescribed drugs in Canada is estimated to have exceeded $35 billion in 2006. This includes public and private insurance, as well as out of pocket expenditures. Spending on prescribed drugs in 2006 was estimated at more than $21 billion. This represents almost 84% of total drug expenditure and is nearly 20% more than in 1985. Spending on all drugs in 2006 amounted to an estimated 17% of total health expenditures in Canada, outstripping what we spend on doctors.

That said, Canadian patented prescription drug prices are in line with other major industrialized countries, except--

[The Acting Speaker, Conservative, Royal Galipeau]

It is with regret that I interrupt the hon. member but the time provided for the consideration of private members' business has now expired and the order is dropped to the bottom of the order of precedence on the order paper.

When Bill C-378 comes back for study, there will be seven minutes left to the hon. member for Fleetwood—Port Kells.

It being 2:30 p.m., the House stands adjourned until Tuesday, November 13, 2007 at 10 a.m., pursuant to Standing Orders 28(2) and 24(1).

(The House adjourned at 2:30 p.m.)