MESSAGE FROM THE PRESIDENT AND CEO

by Andrew Casey, BIOTECanada

Biotech’s Moment

A CENTRAL PILLAR OF BIOTECANADA’S NARRATIVE FOR THE INDUSTRY is the reality of a global population moving quickly to nine or ten billion people and the enormous pressure feeding, housing, healing, and fueling this population growth places on the environment and planet. Globally we must fundamentally alter how we grow, manufacture, cure and energize our economies and societies. Biotechnology can be central in meeting this challenge and for those countries home to vibrant biotech sectors there is enormous economic benefit to be had from developing these solutions. Amidst growing concerns about COVID-19 variants and the challenge of vaccinating the global population, the United Nations’ International Panel on Climate Change (IPCC) issued its climate change report (https://bit.ly/3yo92Ll ) which warned us in no uncertain terms that at current warming levels the world is like a large ocean-going cargo ship: it will take enormous effort to materially alter its course over the coming years. Quite clearly, we are currently on an unsustainable trajectory. The dinosaurs are a good reminder of the reality that ultimately the planet is not at risk, it is we as a species that is at risk if we do not urgently take meaningful steps to reduce our environmental footprint. Again, biotechnology is central to our ability for solving this challenge. The pandemic’s economic, social and health impact certainly has effectively focussed the attention of policymakers and the public on the strategic importance of having a strong domestic life sciences industry and biomanufacturing capacity. Will lessons learned from the pandemic experience change how we respond to the IPCC report? The pandemic should not have been the surprise it was. Long before its arrival, experts cautioned governments regarding the real possibility of a pandemic (indeed, our very own Vaccine Industry Committee repeatedly urged government to takes steps to prepare for a pandemic). Most warnings went unheeded or were met with a minimal response. Accordingly, when it hit, governments found themselves in the uncomfortable position of building the plane while in flight. Several months later, it is clear they have little interest in reliving this experience and are now taking significant steps to prepare for future pandemics. In the 2021 budget, the federal government earmarked over $2 billion in the federal budget to grow the life sciences sector in Canada and develop domestic biomanufacturing capacity. Not only does this make good public policy sense, but it also presents an important and timely opportunity to accelerate the growth of Canada’s biotech sector beyond just a biomanufacturing response in a crisis. If we are to avoid the IPCC’s predicted pandemic-like crisis in the environment, then it would make good sense for all countries to urgently recognize and invest in the solutions coming out of the biotech sector. Launched in the spring of 2020, (read paper here) has been an important vehicle to communicate to policymakers on the value of the entire biotech ecosystem to Canada. The ecosystem is a foundational piece upon which to build as it is national in scope and includes a diverse mix of early-stage companies, universities, incubators/accelerators research centres, investors, and multinational pharmaceutical/biotech companies. Federal and provincial governments have recognized the sector’s importance as they prepare for future covid-like challenges, improve environmental performance and begin the economic rebuild needed over the period ahead. Governments are correspondingly developing strategies and investing to advance the sector and Canada’s competitive position more broadly. While the investments and initiatives are welcome, they are for the most part strategically disconnected. In this context, Canada’s competitive position to attract global investment and grow Canada’s biotechnology sector would be significantly enhanced by federal and provincial governments strategically partnering with industry to coordinate and leverage their investments and policies. In addition, the sector’s overall competitiveness would be greatly enhanced by governments taking steps to modernize and coordinate regulatory oversight of the sector. Accordingly, this is a critical time for industry and government to partner constructively to deliver on diverse but connected objectives relating to the entire life sciences sector. With more than two hundred and forty members representing the full biotechnology ecosystem and all life sciences sectors including healthcare, agriculture, manufacturing, and investment, BIOTECanada will continue to support all undertakings designed to develop a cohesive national strategy to augment the vast potential of the entire biotechnology sector in Canada.

Note: At the time of writing the federal election had just been called.

Canada’s Pharma Supply Gap Needs Urgent Solutions

DANGEROUSLY LOW STOCKS OF ESSENTIAL MEDICINES IN SOME INTENSIVE CARE UNITS EARLY IN THE COVID-19 PANDEMIC drove home how perilously dependent the Canadian medical system has become on other countries for raw pharmaceutical materials and finished drug products.

Montreal-based Pharmascience Inc., one of the largest manufacturers of generic drugs in Canada, and the largest in Quebec, is calling on the federal and provincial governments to step up to the plate and assist the pharmaceutical industry with incentives to improve supply chain sustainability and discourage offshoring to lower wage, lower cost of production countries.

Companies have offshored manufacturing away from Canada to countries like India and China, and to a lesser extent certain nations in the European Union, explains Alain Boisvert, head of government and public affairs at Pharmascience.

“The issue here is not access to capital. Drug companies usually have good access to commercial bankloans or other types of capital sources. But in order to reverse the negative economics that we’ve had over the past 20 years, we would need some direct assistance from governments,” he adds.

Business subsidies or fiscal credits are two strategies that could encourage Canadian pharmaceuticals to stay in Canada and enhance the country’s pharmaceutical manufacturing capacity. There are potential advantages to each. Business subsidies provide an opportunity to receive direct aid, while tax credits tied to achieving specific objectives would not have to be repaid.

Both proposed options - subsidies or credits - could augment production capacity and, in turn, support greater supply chain reliability. The increased output would be measurable and the information derived from that could serve as key performance indicators, says Boisvert.

Pharmascience says that a key strategy to incentivize domestic pharmaceutical production would be for the federal and provincial/territorial governments to collaborate and establish minimal Canadian manufactured contents in the public procurement of medicines.

“If there was a minimum Canadian content in tenders, allowing manufacturers to either bid at a slightly higher price, or at least have a minimum quantity of allocated purchase…that would be good for hospital products,” Boisvert elaborates.

“But we would need another form of local purchasing incentive for ambulatory drugs dispensed through retail pharmacies. For that, we think it would be possible for provincial or territorial governments to allocate local manufacturing credits at a level that would bridge the difference in costs of manufacturing with other countries,” he adds.

This strategy would create an indirect procurement incentive system designed to reward Canadian manufacturing for pharmaceuticals, based on the extent and volume of local sales of Canadian manufactured products.

To mitigate dependence on the global active pharmaceutical ingredients (API) supply chain, Pharmascience calls for the creation of permanent safety reserves of API or finished products for essential medicines, which would be available for purchase in quantities exceeding normal demand in emergency situations like COVID-19.

“The longer-term solution is that we will have to very seriously consider rebuilding an API production capacity in Canada. The technology needs to be scaled up, and we need to create companies that would be suppliers to Canadian local manufacturers, to complete the production process, and be secure from API to finished product,” says Boisvert.

“This is more than just a plain supply issue. This is more than a health care issue. It’s also a national security issue, as our recent COVID experience has demonstrated,” he stresses.