MPs to study $300M Liberal government paid to now-shuttered COVID-19 vaccine manufacturer

Story by Brennan MacDonald • CBC

MPs on the House of Commons health committee voted Wednesday to launch a study into the more than $300 million the Liberal government paid to a now-shuttered Quebec-based pharmaceutical company whose COVID-19 vaccine never made it to market.

Conservative MP Stephen Ellis brought forward the motion calling for the study after reporting by the National Post revealed last week that the government paid $150 million to Medicago in the form of a "non-refundable" advanced purchase agreement.

The Liberal government signed that agreement in October 2020 to secure up to 76 million doses of a plant-based COVID-19 vaccine it was developing.

The government also provided Medicago with an additional $173 million for research and development and for the construction of the company's Quebec City manufacturing facility.

The vaccine never made it to market and Medicago was shuttered earlier this year.

"Three hundred million dollars of taxpayer money was wasted and ... was hidden deep in a document," Ellis told the committee. "The sunny ways and transparency of this Liberal government have gone long and far and deep into some dark, dank cave."



Health Minister Mark Holland, seen here in November 2021, says the government 'did the responsible thing' by supporting the company's vaccine development. (Adrian Wyld/The Canadian Press)© Provided by cbc.ca

Health Canada approved Medicago's vaccine in 2022, but the company ultimately cancelled production after the World Health Organization rejected it for emergency use over the company's ties to a major tobacco company.

At the time, Philip Morris International (PMI) held a minority stake in Medicago. It divested all of its shares in late 2022.

In February, Mitsubishi Chemical Group, which by then owned 100 per cent of Medicago, announced it was shutting down the pharmaceutical company, citing "significant changes" to the vaccine market.

Health Minister Mark Holland said before the committee voted to launch the study that the Conservatives are asking for "a connection with psychics so we can know the future."

Health Minister Mark Holland told the committee the Conservatives expect the government to have predicted the future.

"Let's remember back to the depths of the pandemic when we were all praying for a vaccine. The government did the responsible thing. We took a bet on all viable, scientifically probable options," Holland later told reporters.

"Imagine the world the Conservatives are saying where we should have picked one and guessed that would've worked out."

Conservative MP Rick Perkins raised questions at committee about whether Mitsubishi Chemical Group gets to walk away with the intellectual property and patents produced by Medicago.

"That's the way it appears," said Perkins. "Maybe that's not the case. Maybe the witnesses could actually shed some light onto these contracts."

Innovation Minister François-Philippe Champagne told reporters Tuesday that the government is negotiating a settlement with Mitsubishi in order to obtain the intellectual property produced by Medicago.

"We're very close ... we found someone who is willing to take back the assets and some of the people to turn that around and that's what we hope is going to happen," said Champagne. "The technology is sound but it was a matter of scaling and that's what we've been talking to management and we've found people who want to take that over in a format that would allow the company to be successful over the long term."

The motion to launch the study calls on Holland and Champagne to appear before the House committee to take questions, along with other government officials and representatives from Medicago and Mitsubishi Chemical Group.