Where did Canada’s vaccine effort actually go wrong?

Almost despite the odds, Canada’s vaccination campaign has finally hit its stride: Half of the country has been vaccinated in about five months. More than 20 million doses have gone into arms, and Canada is leading the G7 in vaccinations per day. Shipments are arriving in abundance, and on time; provinces, territories, cities and pharmacies are giving shots nearly as quickly as they’re getting vaccines; and Canadians are stepping up en masse.

At this rate, Canada is well on track to make good on Prime Minister Justin Trudeau’s target to have everyone inoculated by the end of September—a pledge once derided as unrealistic.

But through it all, there has been a lingering belief that Canada’s approach has been a total disaster; that there were serious mistakes made at every step of the way that seriously impacted Canadians’ access to vaccines; that this pandemic was worse than it had to be, because of ineptitude in Ottawa.

In early February, the Globe and Mail front page screamed that “the country’s early vaccination rollout is collapsing.” A National Post column proclaimed that “Ottawa’s mistakes ensured you’ll likely be vaccinated six months later than everyone else.” This magazine ran a piece last summer contending the federal government was “bungling” vaccine plans.

The criticism has continued. On May 12, Conservative leader Erin O’Toole insisted that the federal government’s vaccine procurement plan is “why we’re in a disastrous third wave,” wondering aloud whether “how much longer will the pandemic be in Canada because of this government’s vaccine failures?”

Generally speaking, the arguments fall into three categories:

• Canada spent too much time and energy trying to make a bad idea work, with its plans to partner with Chinese manufacturer CanSino;
• Canada negotiated bad deals, and late;
• Canada failed to scale up domestic capacity that could have made these vaccines here at home.

Conversations with people in Canada’s vaccine industry, federal officials, and documents obtained under the Access to Information Act by Maclean’s show that, while there are elements of truth in each—and clear evidence of lessons needing to be learned—the idea that our vaccine rollout was omnishambles just isn’t right.

There is a consensus that figuring out what, exactly, we did wrong—and what we did right—is going to be core to figuring out how we can do better next time.

So let’s take these issues in turn.

We put ‘all our eggs’ in CanSino

One of the most pervasive notions about Canada’s vaccine plans rests on the idea that the CanSino deal represented a massive opportunity cost in our quest to get vaccines.

Conservative leader Erin O’Toole has hammered away on this, alleging that the Trudeau government put “all our eggs in the basket of China.” He would, in May, allege that the decision to partner with CanSino is “why we have a third wave.” But there has been scant evidence to support it.

At the same time, Ottawa’s fervent refusal to share basic information about its effort to fund vaccine candidates have allowed the misconception to thrive.

Hundreds of pages of briefing notes obtained by Maclean’s through the Access to Information Act, prepared by the National Research Council (NRC) between May and September of 2020, reveal exactly what was going on with the CanSino project behind the scenes.

When the pandemic first hit, the NRC took on the responsibility of trying to identify promising candidates that it could help get through the various clinical trials and regulatory hurdles to help combat the pandemic.

Vaccines, the NRC notes in the documents, normally take between 12 to 18 months from research to approval. “It is vital,” the NRC briefing notes reads, that the whole government “work together to shorten that timeline to the greatest extent possible.”

There was logic to why CanSino was chosen: “The NRC has a strong collaborative history with CanSino,” the documents read. “Including licensing the platform cell line used to develop this vaccine.” CanSino’s vaccine candidate was based on an adenovirus platform: A type of vaccine that the NRC had worked with extensively, in developing vaccines for both rabies and Ebola.

Things were scaled up rather quickly: In late April, CanSino was the first vaccine to advance to phase II clinical trials in the world. The application for human trials in Halifax was approved on May 15 and within days NRC was reporting that “vaccine materials are currently en route from China to Canada.” Global Affairs Canada was roped in a few days later to provide “logistical support” for the transfer.

The NRC was realistic about just how impactful such a project would be, however. “Once fully operational, in the event CanSino proceeds, NRC will be able to produce 70,000 to 100,000 doses of vaccine per month.” It wasn’t much, but the NRC hoped those doses could go to health-care workers and first responders. More doses could have been acquired from the supplier directly, but such a decision is the responsibility of Public Services and Procurement Canada (PSPC).

But, crucially: CanSino wasn’t the only project that the NRC was pursuing.

On March 30, 2020, the NRC signed an agreement with Boston-based VBI Vaccines and its Ottawa subsidiary, Variation Biotechnologies, to pursue their vaccine candidate. On May 6, the NRC signed its agreement with VIDO-InterVac, a vaccine research facility in the University of Saskatchewan. The final agreement with CanSino was actually the third one signed, on May 7.

As the three vaccine candidates sped ahead towards clinical trials, the NRC began making investments to its Royalmount facility, in Montreal, in anticipation of having an approved vaccine to produce—likely the CanSino candidate. In late May, nearly $45 million had been dedicated to upgrade the NRC lab, with an eye to invest more cash to “increase dosage production.”

But “shipping challenges” made clear that the project was troubled early on. The initial deadline was slated for early June. But, by mid-June, the shipment was simply “stalled.” (iPolitics has reported that Ottawa was aware that Beijing was holding up these shipments as early as mid-May.)

Even as Chinese officials held up the shipment, seemingly in a tit-for-tat retaliation in worsening diplomatic relations with Ottawa, the NRC reported in July that “CanSino remains very committed to the Canadian clinical trials.”

Several pages of the memos were withheld under the Access to Information Act, as the NRC deemed their release could be “injurious to the conduct of international affairs.”

Meanwhile, the other vaccines candidates began to show promise. Animal trials for VBI’s candidate began in early June and the NRC provided $1 million in funding for initial scale-up. The scope of the VIDO agreement was expanded “for NRC to provide additional support to accelerate scale up production.” The NRC also made plans to develop a cell line, a crucial bit of biotechnology needed to replicate the cells at the heart of the vaccine, for VIDO to use.

The NRC also forged ahead to expand its own site “to increase dosage production and enable packaging, labelling and distribution of product from the site.” The upgrades, however, became increasingly necessary as the NRC discovered that its existing labs would not pass inspection for “Current Good Manufacturing Practises” standards.

So Ottawa drew up plans to build a whole new facility, which the Prime Minister announced in August.

“The upgrade and expansion of Royalmount will position the NRC to support the biomanufacturing of various vaccine candidates at different stages of development simultaneously,” the briefing notes say. The price tag would surpass $150 million, but the NRC hoped the new facilities would allow it to produce upwards of two million doses a month by “end of the fiscal year.” It hoped the upgrades to the existing facility would be completed “perhaps as early as September.”

At this point, CanSino was clearly off the rails. “This specific opportunity is over and the NRC is focusing its team and facilities on other COVID-19 priorities,” a briefing note from September reads. The federal government hoped that either the Novavax or AstraZeneca vaccines could be mass-produced at the new facility.

Those timelines fell apart as well, as construction delays at the NRC facility mounted. Today, there is little hope that the NRC will produce a single vaccine dose before the end of 2021. In February, Canada signed an agreement with Novavax, whose candidate is yet to be approved, to produce its vaccine at the Royalmount facility, whenever it is ready.

The CanSino vaccine did, eventually, pass clinical trials—the data suggest it carries a relatively modest 65 per cent effectiveness against COVID-19. Millions of the doses began shipping to Mexico and Pakistan in recent months.

VIDO-Intervac, meanwhile, has progressed to phase I clinical trials for its vaccine candidate. VBI is currently mid-way through its trials, but the company is bullish that the vaccine will be successful. Notably, both vaccine candidates are geared towards addressing COVID-19 vaccines—a strategy that may prove incredibly useful, should mutations in the virus overcome immunity conferred by the currently-available vaccines.

Both VIDO-Intervac and VBI have also received support from other arms of government.

It’s hard to look at the NRC’s track record over the past year as a success. At the same time, the NRC’s role was to partner with companies in Canada looking to pursue vaccine candidates — and that’s what it did.  It is abundantly clear that, while time and effort went into the CanSino project, it was by no means the only project Canada pursued. It wasn’t even the only project that the NRC pursued.

Bad deals, done too late

The mixed bag of the NRC’s vaccine pursuits certainly pale in comparison to the ambitious Operation Warp Speed happening south of the border. When then-president Donald Trump promised, last May, to deliver “hundreds of millions” of doses of a COVID-19 vaccine by the end 2020, he was met with skepticism and doubt from scientists and researchers.

But Operation Warp Speed really did move at the speed of light. (Even if the U.S. managed 3 millions doses before the end of the year, not the promised hundreds of millions. We can forgive the ex-president’s for his trademark exaggeration.)

Billions of dollars in research money, to companies like Johnson & Johnson, AstraZeneca and Moderna, helped those companies do the impossible and squash the 12-to-18-month timeline into about six months.

Canada reaped the benefits from those decisions. But it also bet big on the exact right horses.

PSPC confirmed in an email that it signed seven agreements with vaccine producers in the summer and fall of 2020. Those agreements are:

• Moderna: July 24
• Pfizer: Aug. 1
• Johnson & Johnson: Aug. 24
• Novavax: Aug. 27
• Sanofi: Sept. 11
• AstraZeneca: Sept. 24
• Medicago: Oct. 22

It is fairly clear that the deals paid dividends. Yet there has been a pervasive feeling that Canada’s negotiation chops were insufficient. Some argue Canada started negotiations too late. Others say Canada offered too little money, or too much money. Or perhaps that its requested delivery schedule was too late. Or it planned shipments from the wrong facilities.

Conversations with vaccine manufacturers began in mid-to-late spring, a source with knowledge of the negotiations told Maclean’s. Between July and October, Ottawa signed term sheets with those seven manufacturers—agreements that serve as outlines of purchase agreements and final contracts to come. The source said those term sheets included the number of doses expected, timelines on when those doses would arrive, and price. They were also, the source stressed, legally binding. The source was, however, not able to furnish anything in writing to confirm those claims.

Even still, those dates put Canada at the front of the pack. Moderna has confirmed that Canada signed its deal just after the U.S., while Pfizer has said Canada was fourth to sign a deal.

Conservative health critic Michelle Rempel summed up her issues succinctly: Canada, she wrote on Twitter, is “paying double what other countries did and getting it months later than them.”

That doesn’t, however, appear to be true. The contracts are not public, and likely won’t be any time soon — something that is not unusual for sensitive procurement agreements such as these. The same source said that Canada paid a “comparable” amount per dose as other countries. Indeed, looking at aggregate spending on these vaccines — which is a broad figure, and likely includes many associated costs like logistics and shipping — Canada paid roughly $35 per dose of its vaccines.

Leaks to Reuters have pegged the negotiated price-per-dose in the American and European contracts with Pfizer (which is a more narrow price) at $23.59 and $22.77

In the end, it is likely Canada paid more for those doses, but not double. What’s more: Ottawa’s deal-making actually proved quite shrewd.

America, under Trump, was incredibly unlikely to export any doses of any vaccine. Indeed, an export ban meant that not a single dose left America until mid-March of this year, when Washington sent four million doses of its Astrazeneca stockpile to Canada and Mexico. Johnson & Johnson began shipping doses in April, while Pfizer only began sending its vaccines from U.S. plants, to Mexico, in May.

Given that, Canada wisely sought to source its doses from Europe. When it did, it went to virtually every major vaccine producer. When Europe pushed its own export bans, Canada succeeded in, generally, getting exemptions. (Australia, meanwhile, wasn’t quite so lucky.)

Earlier in the vaccination efforts, critics of Canada’s work were quick to point to the international rankings—pointing to Canada being far down the list in terms of doses given.

Yet, as of May 30, Canada ranks 15th worldwide in terms of total doses administered. Six of the countries ahead of Canada are reliant to a large degree on doses from Russian and Chinese manufacturers that Canada—due to concerns over efficacy, safety, and because of the state of diplomatic relations with those countries—has opted not to pursue.

Also ahead of Canada are countries with sizeable biomanufacturing capacity: The U.S., U.K., Germany and India.

Put it all together, and it’s clear that Canada signed its contracts relatively quickly, it picked a portfolio of vaccines that was wisely varied, it paid a reasonable amount for its doses, and its delivery schedules were both ambitious and respected.

Homegrown

When COVID-19 hit the western world, vaccine plants in U.S. and Belgium were quickly tooled up to meet the challenge of pumping out vaccines in short order. Other countries, like Canada and the U.K., were less well-suited.

The British are consistently held up as an example of a country where things went right. Where the government had the foresight and planning to tool up factories to support the fight against COVID-19. And there’s some real truth to that.

The U.K, like Canada, had few domestic facilities capable of making vaccines in 2020. Those that did exist were generally tied up producing other life-saving vaccines and therapeutics—the thing about biomanufacturing is that plants do not, generally, sit idle awaiting a global pandemic.

But London found five companies which could be tapped to produce the vaccines. Some, like Canada’s Royalmount facility and the VIDO-InterVac site, are not expected to fully come online until 2022—in one case, 2023.

According to procurement data, provided to Maclean’s by science analytics company Airfinity, the U.K. has managed to pump out, as of May 12, about 27 million doses of AstraZeneca—that’s about half the total number of doses administered in the country. It’s significant, but it’s also about eight per cent of what the U.S. has managed to produce. The U.K. is still heavily reliant on imports from Europe for its own vaccination campaign.

Even if the U.K.’s last-minute scale-up is a supplement, not a standalone solution, it still raises the question: Why couldn’t Canada do that? The answer is: It probably could have.

The NRC has been responsible for supporting vaccine candidates, including help with expanding manufacturing capacity. PSPC has been responsible for signing agreements with, and effectively funding, companies pursuing promising vaccine candidates—including Quebec City-based Medicago.

But the job of finding partners who could turn their production towards vaccine candidates—either ones already approved, or ones slated to be approved—fell to Innovation, Science, and Economic Development Canada (ISED).

ISED, for example, has provided $56 million to VBI, on top of the support it received from the NRC; $18 million to Precision NanoSystems for its vaccine candidate; $173 million to Quebec City-based Medicago, which is pursuing innovative plant-based vaccine production methods; in addition to smaller envelopes of money to other prospective vaccine producers.

There are two issues with Canada’s strategy, however: Its support was a pittance compared to the investment needed to truly bring a vaccine from concept to real-world use; and it almost exclusively supported companies pursuing vaccine candidates, instead of facilities that could adopt already-approved vaccines.

ISED did receive pitches from Canadian companies offering to produce already-established COVID-19 vaccines, especially AstraZeneca and Novavax. (Pfizer and Moderna’s mRNA vaccines are more novel, meaning expertise is still lacking and licensing is difficult.)

Calgary-based Providence Therapeutics and Montreal company PnuVax have both been touted as reliable partners for vaccine manufacturing — PnuVax is, in fact, right next door to the NRC’s facility in Montreal.

Providence, CBC has reported, had sought a loan from Ottawa to help bring its novel mRNA vaccine to trials in the early months of the pandemic. It was rebuffed. After some media attention last Fall, Ottawa committed about $5 million in support, and added another $5 million in early 2021.

CEO Brad Sorenson told CBC he had requested $150 million—still a fraction of what the U.S. committed to several vaccine manufacturers under Operation Warp Speed—but never heard back. He announced in late April that Providence would be picking up and leaving Canada.

PnuVax, meanwhile, hasn’t commented on whether it submitted plans to produce vaccines here at home—ISED, likewise, cited confidentiality—but its CEO, Donald Gerson, has said publicly that it could be producing significant quantities of the AstraZeneca vaccine. “Someone just has to ask,” Gerson told CTV in December.

The fact of the matter is that Ottawa has long loathed working with Canadian companies. An PnuVax is a perfect embodiment of that problem.

The company’s facilities are expansive, and in recent years have been tooled to mass-produce an innovative pneumonia vaccine. I have spoken to multiple experts, including a member of the government’s COVID-19 vaccine task force and a longtime NRC researcher, who are convinced that the PnuVax facility should have been tapped to mass produce vaccines early in 2020.

Ottawa didn’t. Instead, it poured money into the NRC project, even as the delays whittled down hopes of producing vaccines domestically before 2022.

The PnuVax facilities were originally built by a Dutch biopharmaceutical company on NRC land: The NRC offered the company $1 a year rent, as a way to inspire innovation and investment. It didn’t work, and the company shut down in 2005.

When PnuVax took over the building, an innovative Canadian start-up looking to mass-produce cheap childhood pneumonia vaccines, the NRC wouldn’t offer the same terms, and charged commercial rent. Even as PnuVax was working hard on the vaccines, thanks to a significant grant from the Bill and Melinda Gates Foundation, the NRC played landlord and continued demanding rent. In 2017, after PnuVax fell behind to the tune of about $1 million, the NRC demanded it pay up or face demolition of its building.

When Gerson went to Ottawa to plead with NRC President Iain Stewart—promoted to president of the Public Health Agency of Canada in 2020—Gerson told the National Post that Stewart laughed at him. PnuVax survived, but the hits kept coming.

In the early 2000s, a government-run lab in Winnipeg invented a novel antibody therapy for Ebola: ZMAb. When the virus hit West Africa in 2014, Ottawa tapped PnuVax and another Toronto company to produce a limited run of the antibodies necessary for ZMAb. But, for reasons that still remain elusive, Ottawa didn’t renew the contracts, and entrusted an American company to produce the therapy instead. Few doses of ZMAb ever made it to the virus-hit region.

Last June, I wrote how the tragedy of ZMAb showcased how skeptical the Canadian government seems to be of its own, modest, health sciences sector.

In 2019, the Gates Foundation sued PnuVax, alleging the company had used its grant funds to pay rent. Even that rather inoffensive allegation was never proven, as the suit was dropped just two months after it was filed in a D.C. court.

It’s entirely possible that the bad press PnuVax received—which is, effectively, Ottawa’s fault—warded the Trudeau government away from partnering with the company. It would be almost poetically apt.

Canada could have built up domestic capacity at so many steps along the way: By giving PnuVax a break on rent, by awarding it a full contract for ZMAb, or by tapping it to produce COVID-19 vaccines. Instead, they’ve gotten nothing.

It’s not just PnuVax. Many companies have bemoaned Canada’s reluctance to support Canadian innovators: Decrying its risk-aversion and spendthriftness, which seems to consistently lead to self-injury.

While Operation Warp Speed provided up-front investments, allowing companies to hire staff and scale-up immediately, billions in ISED funds were claims-based—meaning Canadian companies had to file receipts to Ottawa to be reimbursed.

The U.S. and U.K. also, in the name of transparency, released a tremendous amount of information about their efforts to build up and support domestic industry. Canada, by comparison, has been downright secretive—refusing to discuss why some companies were chosen, and not others.

Of all the criticisms of Ottawa’s vaccine strategy, this is clearly the most cogent. Yet, even still, it would have ameliorated Canada’s strategy, not fundamentally changed it. Even in a best case scenario, where every Canadian firm received the money they requested and timelines were hit perfectly, it’s hard to imagine that domestic production would have contributed more than a few million additional doses by May.

Where do we go from here?

It’s crucial we learn some lessons from this crisis.

Not partnering with China on crucial projects is probably a good takeaway.

Releasing more information on contracts and procurement plans would also go a long way to allay concern and build public trust.

Most importantly, Ottawa ought to begin identifying trusted, private, partners to whom it can provide long-term support. Rent-free land, dedicated procurement contracts and consistent grants are all tools that will inspire innovative companies to stick around and be available if and when they are needed next.

But it’s important we don’t walk away from this pandemic with the impression that everything we did was a disaster. Because it certainly wasn’t.