June 30, 2020
In Canada RNA Biochemical Inc. v. Canada (Health), 2020 FC 668, the Federal Court (the “Court”) dismissed an application for judicial review commenced by Canada RNA Biochemical Inc. (“C-RNA”) following Health Canada’s refusal to grant C-RNA a natural health product (“NHP”) licence for one of its products.
An NHP licence allows companies to sell their products without the need for a prescription or any form of medical supervision. C-RNA’s application argued that Health Canada’s refusal to grant C-RNA an NHP licence was both substantively and procedurally unfair.
The applicant, C-RNA, sought an NHP licence for its oral lumbrokinase capsules, “Boluoke”. Lumbrokinase is an enzyme complex derived from earthworms that enhances the breakdown of blood clots. C-RNA emphasized Boluoke’s ability to break down blood clots and sought to market its ability to “reduce blood viscosity” and “improve circulation.” Its target population was people in “hypercoagulable states” (i.e. people with an increased tendency for blood clotting).
In determining whether or not an NHP licence should be granted, the Natural and Non-Prescription Health Product Directorate, the Health Canada body in charge of granting NHP licences, must interpret and follow the Natural Health Products Regulations, SOR/2003-196 (“NHP Regulations”). Subsection 5(g) of the NHP Regulations requires an applicant to include “information that supports the safety and efficacy of the natural health product when it is used in accordance with the recommended conditions of use” in their licence application. In addition to this filing requirement, the Minister of Health must also be satisfied that such information actually demonstrates that the NHP is safe and effective when used in accordance with the recommended conditions of use.
Health Canada rejected C-RNA’s initial licence application in 2006, as well as its subsequent application in 2013, upholding this final refusal on reconsideration. While C-RNA only recommended its product for people in hypercoagulable states, Health Canada expressed concern that healthy people might nonetheless consume Boluoke and that it could cause internal bleeding within this population.
Following Health Canada’s second refusal, C-RNA filed an application for judicial review. C-RNA alleged that: Health Canada had erred in its interpretation of and approach to the NHP Regulations; Health Canada’s decision was unreasonable in light of the information filed in support of the application; and the process that led to Health Canada’s decision was unfair.
1. Was Health Canada’s refusal to grant C-RNA a licence for Boluoke unreasonable?
(a) Did Health Canada Err in its Interpretation of and Approach to the NHP Regulations?
C-RNA asserted that Health Canada unreasonably interpreted the NHP Regulations by introducing terms and requirements not found in the regulations. According to C-RNA, Health Canada read three additional terms and requirements into subsection 5(g): (a) the need to demonstrate safety in a “healthy population”; (b) reference to “over-the-counter” and “self-care” as the model for use of NHPs; and (c) a requirement that the “benefits” of Boluoke outweigh its “risks.”
The Court rejected C-RNA’s argument, finding that Health Canada’s interpretation of the NHP Regulations was reasonable. Specifically, the Court found that the reference to safety, in subsection 5(g), must be considered within the context that NHPs are sold without medical supervision (since prescription products are excluded from the definition of NHPs under the NHP Regulations), and, therefore, people who are not in a hypercoagulable state may nonetheless consume Boluoke. As such, the Court held that it was reasonable for Health Canada to require C-RNA to demonstrate that Boluoke was safe for the broader “healthy population”.
The Court similarly found C-RNA’s argument that Health Canada’s decision was unreasonable because it read terms like “over-the-counter” and “self-care” into the NHP Regulations to be lacking merit. While the term “over-the-counter” is not used in the NHP Regulations, the Court held that the term is simply a shorthand phrase for drugs not requiring a prescription. Given that all NHPs are available without a prescription, and, by extension, are intended for over-the-counter use, the fact that Health Canada used the term “over-the-counter” in its refusal of C-RNA’s licence was of no consequence. Likewise, the Court held that the term “self-care” merely described the context in which many Canadians take NHPs.
Finally, the Court rejected C-RNA’s argument that Health Canada inappropriately required it to demonstrate that the benefits of Boluoke outweighed the risks of the product, stating that the reference, in subsection 5(g), to “safety” and “efficacy” implied consideration of the health risks and benefits, respectively. As such, Health Canada’s risk versus benefit analysis was entirely consistent with subsection 5(g).
(b) Was Heath Canada’s refusal unreasonable in light of the information filed by C-RNA in support of its application?
C-RNA argued that Health Canada acted unreasonably in its assessment of Boluoke. It pointed to numerous aspects of Health Canada’s refusal to support its assertion, all of which the Court rejected.
Citing Greenpeace Canada v. Canada (Attorney General), 2016 FCA 114, the Court cautioned that it is “not to act as an academy of science”; as long as those tasked with assessing the safety and efficacy of prospective NHPs have a reasonable basis for their decision, the Court will not review their scientific judgment. The Court held that Health Canada had a reasonable basis for its refusal; it did not, in other words, fail to consider mitigation strategies or selectively ignore evidence relating to Boluoke’s safety. To the contrary, the Court held that Health Canada had thoroughly examined Boluoke’s safety and efficacy and reached the justifiable conclusion that the product posed a safety risk.
2. Was Health Canada’s Process Fair?
In addition to challenging the reasonableness of the refusal, C-RNA alleged that Health Canada’s process leading to the refusal was unfair. On this point, the Court stated that the ultimate question is whether the procedure was fair having regard to all of the circumstances.
Applying the framework outlined by the Supreme Court of Canada in Baker v. Canada (Minister of Citizenship and Immigration),  2 SCR 817, to determine the degree of procedural fairness owed by Health Canada, the Court found that Health Canada owed C-RNA a “mid-to-low” degree of procedural fairness in relation to its refusal decision. The Court concluded that Health Canada had met this standard, concluding that none of the five deficiencies alleged by C-RNA resulted in an unfair process.
The Court dismissed C-RNA’s application for judicial review, concluding that Health Canada’s decision was both substantively and procedurally fair.
Authors: Sam Galway and Jerred Kiss