NDP, Conservatives want to know why Liberals inked $150M deal with vaccine maker with big tobacco ties

‘The hundreds of millions of dollars that this government has wastefully spent. How many vaccines were created? Not one’

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OTTAWA — The NDP and Conservatives want answers about why the federal government signed a vaccine contract with a company financially tied to the tobacco industry, going against its own policies and leading to a $150-million loss.

“Giving $150 million away to a corporation and getting nothing in return is bad governance,” NDP Health critic Don Davies said during a House health committee meeting Monday.

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“Even worse, what ended up happening here … is the taxpayers of this country and the government of Canada give $150 million to a company that’s associated with big tobacco for nothing. That is a gross violation of the WHO Framework Convention on Tobacco Control. So, I’m very much in favour of getting to the bottom of it,” he added.

Davies was referring to the World Health Organization’s (WHO) 2003 treaty in which signatory countries (including Canada) “avoid such collaborations that would in effect give a positive impression of big tobacco’s role in public health,” according to The Lancet Respiratory Medicine.

On Monday, members of the House health committee were discussing a proposal to launch a study into reports by the National Post that the Public Health Agency of Canada (PHAC) declared a $150-million loss last fiscal year due to an “unfulfilled contract” with former Quebec-based vaccine producer Medicago.

The hearing ended before a vote could be held on the Conservative and Bloc Québécois proposal, but all parties, including the Liberals, appeared to agree to launch a study into the contract.

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The Liberal government signed the $150-million advance purchase agreement with Medicago early in the COVID-19 pandemic to fund development and reserve a number of doses of an eventual vaccine against the virus.

But the contract with Medicago never panned out and the company cancelled vaccine production and was eventually shut down after the WHO refused to accept its product for emergency use due in 2022 because it was partly owned by tobacco giant Philip Morris International.

PHAC first declared the significant loss in the 2022-2023 government public accounts published on Oct. 24. PHAC initially refused to disclose any information at all about the loss to the National Post, but after more than a week of questions from this newspaper and eventually MPs, Health Minister Mark Holland’s office revealed Friday that the deal was with Medicago.

Conservative health critic Stephen Ellis said the Liberal government should have known that it was dealing with accompany with ties to big tobacco and that “there was no way this vaccine was going to be accepted.”

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And if the government didn’t know, that’s also cause for concern and should be investigated, both Ellis and Davies agreed.

On Monday, Opposition members of the health committee lambasted the Liberals for their lack of transparency and vowed to launch a study into the full contract. The government also announced a $173-million investment to Medicago in 2022 for the company to improve its Quebec City production facility and has so far declined to say what happened to that money.

“This is so frustrating to me. How many beds for recovery could that money have built,” he asked. “The hundreds of millions of dollars that this government has wastefully spent. How many vaccines were created? Not one. And where is this country now? Closed the doors.”

Bloc Québécois MP Luc Thériault questioned why it was only after MPs signed a letter demanding the Health Minister come testify in front of the committee that the government began disclosing information about the $150-million loss.

“We tabled the motion for a meeting, and suddenly, the next day, the minister starts revealing things. Why is that?” he asked.

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Liberal MP Brendan Hanley accused the Opposition of demanding the study so they can “delay, delay, delay” other studies planned by the health committee. 

“Just one meeting ago we were hearing how urgent it was that we speak to the opioid crisis in Canada with several hastily constructed motions in that regard. And suddenly, it appears that that’s no longer urgent,” he said.

He and his colleague, MP Majid Jowhari, also pushed back on the notion the government “lost” $150 million in the unfulfilled contract with Medicago. “There is no lost money,” Hanley said.

The writeoff was filed by PHAC in the “losses of public money due to an offence, illegal act or accident” section of the latest public accounts.

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