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December 5, 2014 Hon. Joe Oliver Minister of Finance Department Of

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December 5, 2014 Hon. Joe Oliver Minister of Finance Department Of 405 The West Mall, Suite 900 Toronto, Ontario M9C 5J1 t: 416.620.1915 f: 416.620.1595 toll free: 1-866-58-MEDEC www.medec.org December 5, 2014 Hon. Joe Oliver Minister of Finance Department of Finance Canada House of Commons Ottawa, Ontario K1A 0A6 Re: MEDEC 2014/2015 Pre-Budget Submission Dear Minister Oliver, MEDEC is the national association representing the Canadian medical technology industry. Our member companies employ well over 35,000 Canadians in communities across the country with expertise across multiple disciplines, including manufacturing, sales and marketing, biomedical engineering, biological science, regulatory, professional services and health economics. A thriving economy and a sustainable, high quality health care system go hand in hand. At MEDEC, we operate at the intersection of these two imperatives. Our members create technologies that save patients’ lives, improve the quality of patient outcomes, reduce costs in the health care system, and create thousands of high paying jobs. The timely adoption of medical innovation and technology is essential to enhancing patient care, improving patient access to health care, enabling heath care sustainability, while at the same time driving jobs and economic growth in Canada. Our 2014/2015 pre-budget submission focuses on the following 4 key areas: 1) Support for key Federal Government initiatives related to medical technology, in particular: a) The Federal Health Innovation Advisory Panel b) Free Trade Agreements – CETA and CKFTA c) Acknowledgment of Health Canada’s ability to regulate reprocessed single-use devices 2) Regulatory environment in Canada, in particular: a) Processing timelines for medical device approvals b) Global regulatory harmonization and the Regulatory Cooperation Council (RCC) c) Use of Standards (International and Canadian) 3) Changes to SR&ED and its impact on the medical technology industry in Canada 4) Reuse of Single Use Medical Devices in Canada MEDEC Federal Pre-Budget Submission 2015 – 4 Key Areas of Focus 1) Support for key Federal Government initiatives related to medical technology, in particular: a. The Federal Health Innovation Advisory Panel b. Free Trade Agreements – CETA and CKFTA c. Acknowledgment of Health Canada’s ability to regulate reprocessed single-use medical devices MEDEC would like to affirm its support to the federal government on recent key initiatives, and to offer its ingoing interest in being included in the ongoing discussions of these collaborate initiatives and important issues facing the medical technology industry in Canada. We would like to thank the federal government for all of their hard work and commitment on the below initiatives, which will help contribute to a thriving medical technology industry in Canada, and an improved health care system for all Canadians. a. The Federal Health Innovation Advisory Panel MEDEC strongly applauds the federal government on today’s announcement regarding the creation of Health Minister Rona Ambrose’s Advisory Panel on Innovation in Healthcare. As the national association representing Canada’s Medical Technology Companies, we understand the value that innovative medical technologies can contribute to our healthcare system by improving health outcomes and enabling enhanced methods of care. The announcement of this Panel is recognition by the Government of Canada of that value, and the need to ensure that Canadian patients can access world-class health innovations in a timely manner. MEDEC is looking forward to engaging with the panel and working towards recommendations that improve the adoption of high quality innovative health care solutions in Canada. b. Free Trade Agreements – CETA and CKFTA MEDEC strongly supports the Government of Canada’s recent announcements of the successful conclusion of negotiations surrounding the Comprehensive Economic and Trade Agreement (CETA) and between Canada and the Republic of Korea on a bilateral Free Trade Agreement (CKFTA). Export is critically important to the success of Canada’s medical technology companies and this agreement will have a positive impact on our industry. We are confident that these free trade agreements will support and enhance the Canadian medical technology industry, which will benefit Canadian patients and contribute to increased economic growth, and job creation. c. Acknowledgment of Health Canada’s ability to regulate reprocessed single-use devices MEDEC members are committed to providing safe and innovative medical technologies that enhance the quality of patient care, improve patient access to health care, and help enable the sustainability of our publicly funded health care system. It is important to MEDEC members that patients and health care providers have confidence in the safety of our health care system. 2 We all benefit when public trust is at its highest. This is a crucial component to the ability of innovators to bring better, new medical innovations into the system – which ultimately enable better health outcomes and health care system sustainability. In an effort to save money and reduce medical waste, hospitals in Canada are reusing medical devices that are licensed by Health Canada to be used only once or on a single patient during a single procedure and then be discarded. As many provincial policies are written to prevent hospitals from reprocessing single-use medical devices in-house, hospitals are shipping used devices to U.S. based companies for reprocessing without any federal regulatory oversight for the devices that are then being shipped back for use in Canadian hospitals. On July 30, 2014 – after receiving verbal confirmation from Health Canada officials, MEDEC received written confirmation from Heath Canada that the federal government has the legislative authority to regulate reprocessed single-use devices in Canada. The letter stated that “As discussed in our meeting dated June 16, 2014 the current provisions in the Food and Drugs Act do not preclude the Governor in Council from making regulations with respect to the commercial reprocessing of a single use device or ones that impose conditions on the sale and advertising of a reprocessed single-use device.” “Changes to legislation are not required: regulation of the commercial reprocessing of single use devices could be accomplished with the existing authorities in the Food and Drugs Act and Medical Devices Regulations.” MEDEC would like to thank the federal government for acknowledgement of this important first step in moving towards a framework for regulating the reprocessing of single-use devices in Canada. We have outlined our ongoing concerns around this issue, and suggested solutions, further down in this pre-budget submission. We look forward to working with the federal government in this important patient safety issue. 3 2) Regulatory environment in Canada, in particular: a. Processing timelines for medical device approvals b. Global regulatory harmonization and the Regulatory Cooperation Council (RCC) c. Use of Standards (International and Canadian) The medical technology industry is highly globalized – 80+% of applications for Medical Devices licenses come to Health Canada from manufacturers/licence holders abroad and come to Canada after being approved in other jurisdictions (mainly the USA and Europe). MEDEC suggests making efforts with utmost priority to foster Canadian regulatory alignment in the medical technology sector, and to improve processing timelines for medical device regulatory approvals – and, in relation to improving processing timelines, that Health Canada should receive additional resources in 2015 to address these needs. Foreign market regulatory approval and clearance is more-often-than-not less cumbersome and costly for small-to-medium enterprise (SME) medical technology companies to obtain than regulatory approval from Health Canada. As such, our Canadian healthcare system cannot offer these leading edge medical technologies that were discovered and developed at home, in Canada, to patients in Canada. A more globally harmonized regulatory framework would provide faster processing timelines for regulatory approval in Canada, and with it provide a higher ROI for the taxpayers’ investment in publicly- funded R&D: increase employment in Canada’s medical technology industry, augment Canada’s competitiveness in the global market, and ensure that Canadians receive the latest in healthcare that can be provided. a. Processing timelines for medical device approvals While Health Canada reports that it meets its target timelines required under the Cost Recovery Regulations of 2011, there is significant disagreement by industry regarding the definition of these targets (time to first decision) and the actual ‘time to license’. Only 50% of all Medical Device licence applications submitted to Health Canada comply with Canadian requirements. Applicants need better support from Health Canada to improve this status as it will provide higher efficiencies for Health Canada and the industry. Some tools that Health Canada could use to accomplish this are: Provision of regulatory workshops/webinars with national and international reach, and Development of effective guidance that clarifies expectations and requirements that enables applicants to file submissions that can be approved in a single loop. Reports provided by Health Canada show that the proportion of submissions with screening deficiencies and additional information requests has also been increasing fairly steadily over time (e.g. from 25% of all submissions
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