Question Period Note: NATIONAL EMERGENCY STRATEGIC STOCKPILE MANAGEMENT AND PERSONAL PROTECTIVE EQUIPMENT AND MEDICAL DEVICE PROCUREMENT

• How is the Public Health Agency of Canada equipping frontline healthcare workers with the PPE required to protect their health and mitigate the spread of COVID-19?
• What is the Government of Canada doing to prepare for resurgence and/or mass vaccination campaign scenarios?

KEY MESSAGES
• Canada is continuing to receive a steady supply of PPE with shipments arriving daily, which are rapidly allocated to provinces and territories.
• As of May 25, Public Services and Procurement Canada has confirmed contracts for a variety of PPE, medical equipment and supplies including:
o over 191 million N95 respirators and equivalents (e.g., KN95 respirators; FFP2);
o 451 million surgical masks;
o 1.5 billion pairs of gloves;
o 153 million protective gowns; and
o 40 thousand ventilators.
• We allocate PPE and supplies based on an 80/20 formula, with 80% being allocated to provinces and territories to distribute within their jurisdiction and 20% to replenish the inventory of the National Emergency Strategic Stockpile. This formula was developed in consultation with provinces and territories.
• In response to urgent requests for assistance from provinces and territories, we are also deploying PPE, medical equipment and supplies from the National Emergency Strategic Stockpile.

IF PRESSED ON HOW THE GOVERNMENT OF CANADA IS WORKING TO SECURE A SUFFICIENT QUANTITY OF PPE IN CANADA
• The Public Health Agency of Canada continues to work with Health Canada, and provinces and territories to review the supply and demand of PPE, medical equipment and supplies, based on worst-case epidemiological scenarios, to determine maximum needs.

The Public Health Agency of Canada and Health Canada are also continuing to work with provincial and territorial partners to identify supply gaps and ongoing procurement needs.

IF PRESSED ON THE DISPOSAL OF PPE PRIOR TO THE PANDEMIC

• In 2018 and 2019, the National Emergency Strategic Stockpile disposed of quantities of personal protective equipment such as N95 respirators, gloves and gowns that had past their limit of acceptable use as recommended by the manufacturer.

• In response to the COVID-19 pandemic, Health Canada has approved the use of expired N95 respirators with certain considerations, which has facilitated NESS deployment of expired assets.

• For N95 respirators being deployed to the provinces and territories for healthcare settings, the Public Health Agency of Canada is required to show evidence that the N95s have passed testing and quality verification requirements and meets the Government of Canada’s technical specifications for healthcare settings, prior to any distribution.

For other types of expired PPE, manufacturers must receive approval from Health Canada after demonstrating the product is usable beyond the initial expiry period.
IF PRESSED ON THE MADE-IN-CANADA VENTILATORS
• As part of the Plan to Mobilize Industry to fight COVID-19, contracts were awarded to five Canadian suppliers for the procurement of ventilators.

• Current modelling suggests an oversupply of ventilators. The Government of Canada is currently working with manufacturers to reduce volumes.

• The Public Health Agency of Canada is working with provincial and territorial governments to develop an allocation strategy for these ventilators.

The Public Health Agency of Canada will also be retaining an inventory of ventilators in the National Emergency Strategic Stockpile to meet future needs of the healthcare sector.

IF PRESSED ON CANADA’S DONATION TO INDIA
• Canada donated 350 Baylis Medical ventilators from the National Emergency Strategic Stockpile and 25,000 vials of remdesivir, an antiviral drug, as India confirmed a need for these critical supplies and drugs.
• The Baylis ventilator (model: V4C-560) was authorized by Health Canada in June 2020, under the Interim Order respecting the importation and sale of medical devices for use in relation to COVID-19 for the treatment of patients.
• The ventilators and remdesivir donated to India will not compromise continued efforts to support the COVID-19 response in Canada. Current modelling indicates that Canada has successfully secured over and above an appropriate stockpile of ventilators to meet its potential needs in a worst-case COVID-19 surge scenario.

IF PRESSED ON KN95S DISPOSABLE RESPIRATORS FROM TANGO COMMUNCATION MARKETING INC.
• As this file is in litigation, I cannot speak to the specifics of the file.

BACKGROUND
Canada's National Emergency Strategic Stockpile (NESS) contains supplies that provinces and territories (PTs) can request in emergencies, such as infectious disease outbreaks, natural disasters and other public health events, when their own resources are exhausted. The stockpile includes a variety of items such as: medical equipment and supplies; pharmaceuticals; and social service supplies, such as beds and blankets.

To address the procurement and distribution needs in support of the frontline health care response to COVID-19, the Government of Canada deployed a multi-pronged approach of interdepartmental coordination that includes the Public Health Agency of Canada (PHAC), Health Canada, National Research Council (NRC), Global Affairs Canada, the Department of National Defense, Public Services and Procurement Canada (PSPC), Statistics Canada, and Innovation, Science and Economic Development Canada (ISED).

NESS Mandate
The fundamental basis underpinning federal emergency management and the NESS is that provincial, territorial and local governments are prepared to be able to respond in a reasonable manner to the most common emergencies in their jurisdictions. This includes being responsible for the procurement and management of personal protective equipment (PPE) and other medical supplies.

As such, the federal government’s role in stockpiling emergency health assets is twofold:
• It provides surge capacity support to provinces and territories at their request when their own resources are not sufficient; and
• It is the sole provider of certain assets required for rare public health emergencies, for example, costly and rarely used vaccines or antidotes.

PHAC acknowledges that the pandemic created unprecedented demand for certain types of supplies. Canada, like most countries, is applying the lessons learned from the COVID-19 outbreak to our stockpiling strategies and considering all options going forward to ensure that the most effective stockpile practices are implemented and maintained.

NESS Footprint
NESS facilities consist of a central depot in the National Capital Region and warehouses strategically located across Canada. In recent years, the NESS moved from nine warehouse locations across Canada to six. An independent assessment indicated that the six strategic locations would maintain the NESS’ role as timely surge capacity support.

To respond to the COVID-19 pandemic, the NESS has added warehousing capacity through temporary warehousing and third-party logistics solutions. This has increased the footprint of the NESS by approximately 1 million square feet of dedicated space to respond to the COVID-19 pandemic.

When a warehouse is closed, usable supplies are moved to a new location, while obsolete and expired supplies are disposed of as per Treasury Board policy.

NESS Funding
In 2010-11, the ongoing annual base funding for the NESS, including salary and operating costs was $5.6 million. By 2012-13, the annual base funding for the NESS was reduced to $3 million. Additional funding has historically been provided to the NESS through internal reallocation decisions and incremental funding decisions through which PHAC has received funding linked to specific purchases, such as a four-year investment in medical countermeasures against smallpox and anthrax that began in 2015-16.

More than $5.8 billion has been invested in the NESS since the onset of the COVID-19 outbreak in Canada for the procurement of PPE, medical equipment and supplies and for logistics and warehousing.

PPE Procurement, Domestic Capacity Building and Distribution

At the beginning of the pandemic, PHAC led a bulk procurement process of PPE, medical equipment and supplies on behalf of the federal government and PTs. This bulk procurement was to support the large-scale effort to combat COVID-19 and was agreed to by FPT Ministers of Health. PHAC allocated bulk procured PPE using an 80/20 formula: 80% is distributed to PTs on a per capita basis and the remaining 20% replenishes the NESS inventory, including a 2% allocation to Indigenous Services Canada to support the requirements of First Nations on reserve.

Products from the bulk procurement continue to arrive daily at NESS warehouses and are rapidly allocated to PTs to support healthcare workers across the country. In parallel, PHAC is bolstering its stockpile of PPE and medical devices so that it can respond, when needed, to the surge capacity needs of PTs above the allocation they receive from the bulk procurement process.

Procurement and distribution of PPE for other government departments is led by PSPC.

In addition to original bulk procurement efforts, ISED and PSPC continue to galvanize Canadian industries to increase domestic manufacturing capacity, including re-tooling facilities to produce equipment and supplies including portable ventilators, surgical masks, and rapid testing kits.

Throughout this process, PHAC, Health Canada and the NRC are playing a critical role, conducting technical reviews to verify that the products meet the Government of Canada technical specifications for COVID-19 as available on the PSPC’s buy and sell website.

Access is further facilitated by Health Canada, by expediting regulatory approvals of products through the Interim Order (IO) for Medical Devices signed by the Minister of Health on March 18, 2020. On March 1, 2021, Health Canada introduced Interim Order No. 2 respecting the importation and sale of medical devices for use in relation to COVID-19, which replaced and repealed the first Interim Order. As the regulatory authority, Health Canada also continues to monitor the safety, quality, and efficacy of all medical devices for use in the diagnosis, treatment, mitigation and prevention of COVID-19.

Health Canada also continues to actively engage the medical device industry as well as provinces and territories to monitor for any signals of supply disruptions in Canada. Manufacturers and importers are also required to notify the Minister of Health of medical device shortages considered critical.

Health Canada is closely monitoring the supply of any potential treatments for COVID-19 and working with companies to help ensure continued supply in Canada.

Health Canada is also modelling PPE, medical equipment and supplies, and supply and demand at provincial and territorial, as well as pan-Canadian levels, to understand and plan for possible pressure points across different sectors of the economy and to inform future procurement plans of PPE, medical equipment and supplies.

In addition, the government is also exploring opportunities for more environmentally conscious federal PPE, medical equipment and supply procurement.

PPE Testing and Quality Assessments
Sourcing PPE from new suppliers and manufacturers (both domestically and abroad) is challenging. Once products are delivered to PHAC they must undergo quality verification before distribution to PTs. If PHAC cannot account for the quality of equipment, it is not distributed to PTs for frontline healthcare response. This process is supported by testing capacity within the NRC.

Test results are also used to inform future procurements. PSPC and PHAC work with suppliers to address issues at the source or avoid purchasing from unreliable suppliers in the future once issues are identified.

Health Canada continues to monitor authorized medical devices for safety and effectiveness after authorizing them for use in Canada. If concerns arise, Health Canada takes appropriate action to protect the health and safety of Canadians.

KN95 Respirators
On May 8, 2020, the CBC reported that of the approximately 11 million KN95 respirators received by the Government of Canada and sourced by a Montreal-based supplier out of China, 8 million did not meet the Government of Canada’s technical specifications for healthcare settings for COVID-19 response, 1 million met specifications, and 1.6 million were pending testing results. The number not meeting specifications has since increased to approximately 10 million. Where possible, supplies that do not meet specifications are subsequently assessed for potential use in non-healthcare settings.

Canada’s Action against Tango Communication Marketing Inc
On May 6, 2021, Canada brought an action against Tango Communication Marketing Inc. for $81M. In the spring of 2020, Canada purchased 37 million KN95 respirators from Tango. Large upfront payments were commonplace at the beginning of the pandemic when PPE was urgently sought. Canada’s position is that a large number of the respirators did not meet the contractual requirements.

Disposal of PPE

In response to a question raised at the Government Operations Committee, the Public Health Agency of Canada reported on disposals of personal protective equipment in the calendar years of 2018, 2019 and 2020. This disclosure indicated that in 2018, PHAC disposed of 6,930,696 units of PPE, which included N95 respirators, gloves and surgical masks. In 2019, PHAC disposed of 1,909,246 units of PPE, including N95 respirators, gowns, gloves and surgical masks. All units of PPE had passed the limit of acceptable use, as recommended by the manufacturer. No units of PPE were disposed of in 2020.

Health Canada, in the context of the COVID-19 pandemic, approved the use and has allowed the deployment of expired N95 respirators with certain considerations. For N95 respirators being deployed to the provinces and territories for healthcare settings, PHAC is required to show evidence that the N95s have passed testing and quality verification requirements and meets the Government of Canada’s technical specifications for healthcare settings, prior to any distribution.

For other types of expired PPE, manufacturers must receive approval from Health Canada after demonstrating the product is usable beyond the initial expiry period.

Taking into account lessons learned from the COVID-19 pandemic, PHAC is currently working on a strategic long-term plan that will focus on capacity and readiness of the NESS to support responses to future public health emergencies. This is expected to include a focus on key areas such as optimizing operations, including logistics and life-cycle management; enhancing infrastructure and systems; working closely with PTs and other key partners to strengthen Canada’s overall preparedness; and, conducting ongoing analysis on asset requirements.

Made-in-Canada Ventilators
As a result of ISED’s Call to Action, the Government of Canada identified five Canadian companies capable of manufacturing made-in-Canada ventilators in support of the fight against
COVID-19. Each has been contracted to provide made-in-Canada ventilators (for a total of up to 38,520): FTI Professional Grade (FTI), CAE, Canadian Emergency Ventilators/Starfish, Vexos and Thornhill Medical.
Since the spring of 2020, the evidence and public health guidance has evolved and ventilator use has been de-emphasized for the treatment of COVID-19 patients. Updated information and modelling indicate that Canada has successfully secured an appropriate supply and stockpile of ventilators to meet its potential needs.
As of March 25, 2021, the Government of Canada has successfully secured 27,689 ventilators. Thanks to the efforts of our suppliers and based on latest modelling estimates, Canada now has more ventilators than would be needed in a worst-case COVID-19 resurgence scenario. As a result, PSPC and PHAC are working with the manufacturers to identify opportunities to reduce the volumes.
CAE Ventilators
CAE is one of five companies contracted by the Government of Canada to domestically manufacture ventilators. While the company initially received authorization from Health Canada under the Interim Order in June 2020, Health Canada and PHAC identified quality issues associated with the initial shipment of ventilators delivered in July 2020. Health Canada required CAE to issue an amendment to address issues identified. Further to the amendment submitted by CAE, Health Canada authorized the CAE Air 1 version 1 on September 28, 2020. CAE also submitted an application for the CAE Air 1 version 2, which Health Canada authorized on November 18, 2020.
PHAC has identified concerns with ventilator quality and reported observations to Health Canada for regulatory consideration. In December 2020, Health Canada requested and assessed information from CAE relating to their quality system. The review concluded CAE has an adequate quality management system in place.
In January 2021, PHAC reported issues with backup power modules within the CAE ventilators. Health Canada’s assessment of this issue is ongoing.
Canada’s Donation to India
Due to a significant surge in COVID-19 cases in India, the Government of Canada is sending up to 25,000 vials of the antiviral Veklury (remdesivir) and up to 350 Baylis Medical ventilators from its National Emergency Strategic Stockpile (NESS) to help respond to the critical situation in India. Up to 2,500 Baylis Medical ventilators are available from NESS.
A delivery on May 5 included an immediate 50 ventilators as part of an initial supply of up to 350 ventilators. However, the ventilators require a different electrical cord for use in India. The ventilator manufacturer, Baylis Medical, was able to secure the power cords required for the immediate shipment of 50 ventilators; with remaining ventilators subsequently being shipped with adaptors.
Canada is also sending up to 25,000 vials of the antiviral Veklury (remdesivir), which is used for the treatment of patients with severe symptoms of COVID-19. 25,000 vials is equivalent to more than 4,000 courses of treatment.
The donation of these supplies to India will not compromise continued efforts to support the COVID-19 response in Canada. Updated information and current modelling indicate that Canada has successfully secured over and above an appropriate supply and stockpile of ventilators to meet its potential needs in a worst-case COVID-19 surge scenario.

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