Question Period Note: Health product shortages

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• Health product shortages pose a risk to the health of Canadians. The COVID-19 pandemic further exposed vulnerabilities in the health product supply chain that impacted supplies of products required to treat patients with COVID-19 and other health conditions.
• The need for vigilance in maintaining the national health product supply continues. Health Canada is continuing its surveillance activities and engagement with provinces and territories, and key supply chain players to mitigate impacts and move towards prevention of shortages where possible.
• Ensuring that Canadians have access to needed health products is a top priority for our Government.
• Significant efforts were made throughout the pandemic to respond to health product supply disruptions; the need for vigilance continues.
• In 2021, new regulations came into force that provide new tools to help prevent and alleviate health product shortages and to safeguard the supply.
• We continue to work with provinces and territories, industry, healthcare and patient groups and international partners to closely monitor the supply of health products and take necessary action to help minimize the impact of shortages, and prevent them where possible.

Shortages in Canada
Health product shortages are an increasingly common, global issue. Canada is particularly vulnerable to shortages due to its small market share and reliance on imported products. 68% of Canadian drugs are imported from outside of Canada and 83% of activities related to drug production (e.g., manufacturing, packaging, labeling) are performed outside of Canada. Similarly, the majority of medical devices on the Canadian market are imported. Further, Canada holds only 2% of the global market share for drug sales and 1.8% of the global market share for medical devices.

Health Canada’s Role
Health product shortages can have a significant impact on patients and health care professionals.

Addressing the complex issue of health product shortages is a multi-stakeholder responsibility requiring federal leadership and collaborative action from provinces and territories, manufacturers, distributors, and practitioners. When national shortages occur, Health Canada works with provinces and territories and stakeholders across the supply chain to identify mitigation strategies, which may include regulatory measures, and to explore access to alternative products available in other jurisdictions.

Several factors are taken into account to determine both the potential impact of a shortage of health products and the actions required by Health Canada. Factors such as whether the shortage is national in scope, whether alternative supplies are available and whether the product is considered medically necessary are all considered in determining the potential impact.

New tools to address shortages
The pandemic has had major impacts on drugs and medical devices in Canada and globally. The number of national/critical shortages increased significantly throughout the pandemic. As well, secondary effects from the pandemic are expected to persist in the medium to long term, such as fluctuating demand, supply chain challenges and healthcare system recovery.

The department built on time-limited regulatory instruments introduced early in the pandemic to develop permanent regulatory tools to help address these challenges. New authorities were added in the Food and Drug Regulations and the Medical Devices Regulations, which allow the Minister to:

• Permit the exceptional importation of drugs and medical devices to address a shortage or an anticipated shortage. Imported products in this case do not need to fully meet Canadian regulatory requirements but must be manufactured to comparable quality standards.
• Require manufacturers and importers of specified medical devices to report shortages and discontinuances that could lead to a shortage.
• If required, request that drug establishment licence holders and medical device manufacturers, importers, and distributors provide information needed to assess, prevent, or alleviate a shortage.
The regulations also respond to risks posed by bulk importation frameworks, such as the one established by the United States. A prohibition was put in place on drug establishment licence holders from distributing certain drugs intended for the Canadian market for use outside of Canada if that distribution could cause or exacerbate a shortage. This serves to ensure that bulk importation frameworks do not cause or exacerbate a drug shortage in Canada.

With these tools in place, Health Canada is now better equipped to help address shortages of health products.

Engagement with Provinces and Territories in Managing Health Product Shortages
Over the last number of years, capacity has been built up across governments, leading to a more coordinated and effective approach to mitigate the impacts of shortages.

Health Canada has strengthened existing mechanisms to manage health product shortages, and has leveraged existing FPT infrastructure and increased cooperation with multiple partners to identify shortage signals earlier, especially for critical products required for COVID-19. For example, through FPT collaboration, a process for the allocation of imported critical drugs is now in place to facilitate the distribution of critical products. The process allows companies the opportunity to work with Health Canada and provincial and territorial governments in allocating supply where it is needed most. This has also been effective in managing limited supplies of therapies being used to treat COVID-19 (e.g., Tocilizumab, Remdesivir) as well as drugs that are in high global demand upon authorization by Health Canada (e.g., Paxlovid).

Working with provinces and territories, Health Canada established a COVID-19 Critical Drug Reserve in 2020 that complemented other drug shortage mitigation efforts. It included 12 drugs used to support patients with COVID-19 that have been in high demand or in shortage, including sedatives, pain relievers, antibiotics, muscle relaxants, and inhalers. The Critical Drug Reserve served as a backstop for Canada’s existing supply, complemented the existing drug shortage management systems, and mitigated critical drug shortages, which relieved pressures on provincial and territorial health care systems through several pandemic waves. This pandemic initiative ended on June 30, 2022.

During the pandemic and beyond, Health Canada has worked with FPT partners to address medical device shortages. Work continues to formalize FPT collaboration and strengthen relationships in the medical devices sector.

Health Canada officials continue to work with the provinces and territories, other international regulators and industry stakeholders to closely monitor Canada’s health product supply so that timely action can be taken to ensure Canadians have access to the health products they need.

• Canada is a small market that relies heavily on imported products, making it vulnerable to shortages. During the pandemic, global supply challenges and unprecedented demand further contributed to shortages in Canada.
• Lessons learned from the pandemic informed the development of new regulations that provide new tools to address health product shortages.
• As of November 24, 2022, 65 drug shortages were de-escalated from critical status, out of a total of 92 that were deemed in critical shortage since the onset of the pandemic.
• As of November 1, 2022, 321 of the 439 medical device shortages reported through the mandatory framework are now resolved.