The City of Ottawa will receive $40 million back after awarding Quebec City-based biopharmaceutical company Medicago more than $300 million to develop and manufacture a domestically produced COVID-19 vaccine that never made it to market. It turns out.
The news comes after Conservative, Bloc and National Democratic Party members on the House of Commons health committee grilled Procurement Canada staff this week over the federal government’s agreement with Medicago during the pandemic. .
Funding Medicago received from the federal government in 2020 includes $173 million from Innovation, Science and Economic Development Canada (ISED) to support the development of vaccine technology and the construction of a manufacturing facility in Quebec City. was.
ISED announced in a press release that Ottawa has reached an agreement with Medicago’s former parent company, Mitsubishi Corporation, to recoup the $40 million spent on building the facility.
The National Post revealed last month that on top of the ISED funding, the government paid Medicago an additional $150 million in the form of a non-refundable contract for advance purchase of COVID-19 vaccines.
Medicago’s vaccine was approved for use by Health Canada in February 2022, but was never brought to market. The World Health Organization also did not approve it for international use because it was partially owned by the tobacco company Philip Morris International at the time.
The Medicago facility closed in February 2023 following Mitsubishi’s decision to halt sales of the coronavirus vaccine Cobifenz and funding for the entire company. At the time, Innovation Minister François-Philippe Champagne pledged to work to protect the facility’s intellectual property and around 400 jobs.
In June of this year, the vaccine purchase agreement between Canada and Medicago was terminated by mutual consent.
An agreement has now been reached to allow former Medicago employees to purchase the facility, Champagne said.
Medicago’s research and development assets, intellectual property and equipment will be transferred by Mitsubishi to a new Quebec company called Aramis Biotechnologies. According to ISED, Aramis is run by former Medicago employees.
“Today’s announcement provides a unique opportunity to leverage the initial government investment in Medicago and keep an important domestic asset in the Canadian ecosystem,” the press release said.
Medicago is not the only vaccine deal to fail.
Ottawa likely won’t return the $150 million it provided to Medicago to pre-purchase vaccines.
In testimony before the House of Commons health committee on Monday, federal procurement officials told MPs that the City of Ottawa has entered into seven advance purchase agreements for COVID-19 vaccines.
The committee heard that along with the contract with Medicago, the contract with Sanofi Pharmaceuticals was also terminated.
Asked by Canadians how much the contract cost, Andrea Andrach, director of the Department of Public Works and Government Services, said she did not have that information.
Public Services and Procurement Canada declined to provide that information to CBC News.
“Due to confidentiality clauses in the vaccine contract, we cannot disclose financial information or contract termination details,” the response said.
“The Government of Canada is committed to transparency and accountability and is making contract information publicly available to the fullest extent possible.”
The Public Services and Procurement Agency of Canada announced in September 2020 that it had reached an agreement with Sanofi to purchase up to 73 million doses of the company’s vaccine, subject to Health Canada approval. The contract ended in February, the same month the Medicago facility closed.
Health Minister Mark Holland defended the advance purchase agreement, arguing that Canada needed to enter into an advance purchase agreement to ensure it would have doses if any of these vaccines were approved.
“Let’s remember when we were all praying for a vaccine at the depths of the pandemic,” Holland told reporters last month. “The government acted responsibly. We bet on all viable and scientifically possible options.”
