Enlisting the Canadian statutory and regulatory apparatus in the fight against COVID-19

The Canadian government is continually amending and supplementing its regulatory apparatus to better manage the COVID-19 crisis, and, in particular, to address shortages of necessary drugs and medical devices, expedite the development of promising vaccines and treatments, and ensure there will be sufficient manufacturing capacity to produce such vaccines and treatments for all Canadians when they are ultimately available.

A. Expediting access to needed drugs

On March 30, 2020, the Minister of Health invoked section 30.1 of the Food and Drugs Act [1] to issue an Interim Order to address potential shortages in needed drugs.

This Interim Order provides for the creation of a List of Drugs For Exceptional Importation and Sale. If a drug is included on this list, a person holding a drug establishment licence may import the particular drug without having to meet many of the requirements of the Food and Drug Regulations that are operative in ordinary times. Obligations to update the drug establishment licence, report all adverse drug reactions and recalls, fulfill most Good Manufacturing Practices and maintain distribution records remain.

Importers seeking to take advantage of this Interim Order must notify the Minister of Health with prescribed details of the drug to be imported (e.g., the importer’s and manufacturer’s name and contact information, details regarding the formulation and conditions of use, and details regarding the importation itself) 5 days before the date of importation. The Minister then has an opportunity to object to the importation.

As of this writing, there are 37 listed drugs including various formulations of Profonol, Midazolam, Ceftriaxone, Ketamine, Norepinephrine, Pancuronium, Dexmedetomidine, Succinylcholine Chloride, Rocuronium, Vecuronium, Salbutamol, Azithromycin, Fentanyl, Morphine, Hydromorphone, Meropenem, Timolol, Succinylcholine Anectine, and Cisatracurium. Importers may make proposals to Health Canada to have their products added to the List.

B. Expediting access to disinfectants

The March 30, 2020 Interim Order also relaxes the regulatory requirements for disinfectants used on skin or hard surfaces. Under the Interim Order, domestic companies that do not currently have a drug establishment or site licence to conduct activities related to a particular hand sanitizer or disinfectant may submit an application under the Interim Order for marketing approval. However, distribution records must still be kept. Under the Interim Order, hand sanitizers and disinfectants need not have bilingual labelling (but bilingual labelling will need to be posted on the applicant’s web site).

To date, 379 products have been approved under the Interim Order.

C. Expediting access to medical devices

Anticipating the COVID-19 pandemic would cause an urgent need for personal protective equipment (masks, gowns, face shields, etc.), Health Canada took steps to encourage producers to make and distribute these items.

First, Health Canada committed to expediting the granting of Medical Device Establishment Licences (MDEL) for COVID-19-related Class I devices.[2] Ordinarily, Health Canada targets the review of applications for such MDELs within 120 days. Under the Interim Order, Health Canada committed to reviewing these applications within 24 hours. Notably, the expedited review process does not excuse the applicant from complying with the obligations set out for applicants in the Medical Devices Regulations. Chief among these obligations is that the applicant have procedures to maintain distribution records, complaints, recalls and mandatory problem reporting.

Health Canada was initially inundated with applications for MDELs and some reviews were not completed within the 24-hour target. Health Canada has since modified its approach. When it receives an application for a COVID-19-related application for an MDEL, Health Canada issues a submission number which serves as a temporary MDEL pending review, which Health Canada says it will complete in 1-2 months. In the meantime, the applicant can carry on as if it had an MDEL, and must keep the records required for these establishments. According to Health Canada, as of April 30, 1500 COVID MDELs have been issued with 500 in queue.

Second, Health Canada issued an Interim Order on March 18, 2020, which provides a streamlined way to bring COVID devices to market on a temporary basis without a Medical Device Licence or a Medical Device Establishment Licence. While the Interim Order applies to devices of all classes, it is particularly helpful in respect of devices of the higher risk class, such as Class II ventilators and Class III RT-PCR test kits, which normally require the submission of extensive data regarding the safety and efficacy of the device in use.

Under the March 18, 2020 Interim Order, if the COVID-19-related device is already the subject of an authorization from a trusted foreign regulatory authority (which includes approvals at the state level), no safety and efficacy data need be submitted. If the device is not so licensed, the submission requirements are also more streamlined. To further minimize barriers, Health Canada waived all application fees associated with this Interim Order. Market approval under the March 18, 2020 Interim Order is temporary and will end when Health Canada revokes the Interim Order, barring some other provision. As of April 30, 2020, 290 Interim Order approvals have issued with 700 more in the queue. Among these are Canada’s first approved antibody test and 18 diagnostic testing devices.

Third, the March 30, 2020 Interim Order also addressed medical devices. This Interim Order created an obligation on manufacturers and importers of medical devices to notify Health Canada when there is likely to be shortages of specific medical devices. Health Canada specifies these devices in its published List of Medical Devices – Notification of Shortages. The fact that a device is included in the List of Medical Devices – Notification of Shortages means it may be imported and sold, on 5 days’ notice to Health Canada, upon meeting certain but not all of the ordinary regulatory requirements specified in the Medical Devices Regulations.

D. Facilitating the development of new COVID drugs and vaccines

Health Canada announced it is adopting policies to facilitate the development of treatment options and vaccines for COVID-19.

In particular, Health Canada is facilitating clinical trials by fast tracking approvals for those companies and researchers who have sufficient pre-clinical data to be planning clinical trials. Health Canada also recognizes the particular exigencies of conducting clinical trials during a pandemic, such as the need for deviations from ordinary clinical trial practice to limit face-to-face contact between clinicians and test subjects, allowing for the shipping of test drug directly to a test subject and accommodating the potential need for health care workers and subjects to self-isolate at times. At present, there are 25 clinical trials underway on potential COVID-19 treatments and vaccines.

Health Canada will also expedite its review of any COVID-19-related health product submissions or applications once results of studies become available. When expediting these reviews, Health Canada will continue to ensure products are supported by sufficient evidence of safety, efficacy and quality to merit access to Canadians.

E. Facilitating cross-border cooperation between regulatory agencies

Health Canada is also collaborating with international regulators and organizations, including the International Coalition of Medicines Regulatory Authorities. The United States Food and Drug Administration (US FDA) released a guidance document in March 2020 to help expand the availability of ventilators and other respiratory devices and their accessories during the pandemic. Health Canada encourages stakeholders to reference the US FDA’s guidance in addition to Health Canada’s required review elements when compiling their submissions to Health Canada.

F. Altering the parameters of competition law to permit cooperative work toward COVID-19-related goals among entities that are normally competitors

The COVID-19 crisis has raised a number of competition concerns and issues.

At the outset of the crisis, the Competition Bureau warned it would be on the alert for anti-competitive conduct. However, recognizing the need for a sufficient supply of products and services for the Canadian market, the Bureau published a statement on April 8, 2020 to assist companies who wished to collaborate with respect to the efficient supply of products and services, for example, allocating scarce manufacturing resources. Thus, in the short term, where there is good faith and motivation to contribute to the crisis rather than achieve competitive advantage, the Bureau is prepared to accept competitor collaborations.

Related to the foregoing is the concept of patent pools. While Canada has not yet explicitly addressed patent pooling, the United States Patent and Trademark office launched an initiative aimed at partnering IP owners interested in licensing their technologies with potential licensees to provide efficient and expeditious supply of COVID-related materials and technologies. This initiative is similar to the United Nations-backed Medicines Patent Pool founded in 2010 and now extended to contribute to the global response to COVID.

In respect of mergers and COVID-19, the Bureau addressed the “failing firm“ claim that may arise in COVID-19 circumstances. The Bureau indicated its examination of a firm‘s solvency is dynamic and will be considered given the effects of COVID-19.

Finally, with the unprecedented demand for health care products and devices, there has been abuse in the advertising and promotion of these products in various quarters. As a result, the Bureau made enforcement of the deceptive marketing practices under the Competition Act a key priority in relation to health care products, devices and services. In late March, the Bureau released a series of statements warning against potentially false or misleading claims. On April 16, the Bureau indicated it had issued 17 compliance warnings in respect of misleading claims related to COVID-19.

G. Providing for compulsory licensing of inventions with application for COVID-19

Canada has always had a compulsory licensing regime for patents. Sections 19-19.3 of the Patent Act exist to provide the government with the ability, in times of emergency, to allow needed product to be manufactured irrespective of any pertinent patent rights.

In March, 2020, Canada amended its Patent Act to expand its compulsory licence provisions. New section 19.4 enables the Minister of Health to apply to the Commissioner of Patents for authorization to use a patent when the Chief Public Health Officer confirms there is a public health emergency that is a matter of national concern.

On application by the Minister of Health made before September 30, 2020, the Commissioner of Patents must authorize the government and any other designated person to use the patented invention to respond to the public health emergency. The patentee will be compensated in an “amount that the [Patent] Commissioner considers to be adequate remuneration in the circumstances.” Any authorizations granted will expire either a year after the grant or when the Minister of Health deems it no longer necessary, whichever comes earlier.

The rights provided under section 19.4 of the Patent Act are broader than the compulsory licence provisions existing previously. For example, under the existing regime, the Commissioner had a discretion in considering whether to grant the authorization whereas the new provision requires the Commissioner to do so. Under the existing provision, only a government or its agent may use the patented invention, but the new provision provides that “any person specified in the application” may be granted an authorization. Under the existing provision, any decision made by the Commissioner is subject to appeal to the Federal Court while the new section contains no explicit right of appeal. Under the current provisions, the Commissioner may not authorize use of a patented invention unless the applicant establishes it made efforts to obtain authority to use the invention from the patentee on reasonable commercial terms and conditions and was not successful within a reasonable period. There is no such condition under the new section 19.4.

To date, based on public information, the Canadian government has taken no COVID-19 official actions relating to patented inventions.

[1] R.S.C. 1985, c. F-27. Section 30.1 provides that the Minister may make an interim order if the Minister believes that immediate action is required to deal with a significant risk, direct or indirect, to health, safety or the environment. [2] Class I devices are those which present the lowest risk to the patient in use, such as face masks and face shields.

Authors: Harry Radomski and Richard Naiberg