In June 2020, McHaffie J of the Federal Court dismissed an application for judicial review brought by Canada RNA Biochemical (C-RNA), concluding that the minister of health (the minister) had been reasonable in refusing to grant a natural health product (NHP) licence to C-RNA for its oral lumbrokinase capsules (Boluoke).(1) Lumbrokinase is an enzyme derived from earthworms that is alleged to have "fibrinolytic properties" by enhancing the breakdown and preventing the formation of blood clots.
On 2 November 2021, the Federal Court of Appeal dismissed C-RNA's appeal to set aside the Federal Court's decision, finding that C-RNA had not demonstrated any reviewable error in either the minister's decision to refuse the NHP licence or the Federal Court's reasoning.(2)
In the appeal, C-RNA advanced a number of arguments, each of which was dismissed by the FCA.
Drug versus NHP
As a preliminary matter, C-RNA argued that the minister had been "confused" about which regulatory regime governed the Boluoke application – that is, whether it was to be considered a drug under the Food and Drugs Regulations, or an NHP under the Natural Health Products Regulations (NHP Regulations).
In rejecting this argument, the Federal Court of Appeal stated that the two regulatory regimes not only make explicit "legislative demarcations" between a prescription drug and an NHP, which is a naturally occurring substance sold without a prescription, but are also "legally and operationally discrete". Accordingly, it found that Boluoke "falls squarely" under the NHP Regulations as a non-prescription product derived from animals.
Onus to prove safety and efficacy
C-RNA contended that the minister bears the onus to prove a substance is not safe or efficacious in a NHP licence application. The Federal Court of Appeal disagreed. It stated that section 5 and 7 of the NHP Regulations place the burden on the applicant to provide evidence demonstrating the safety and efficacy of its product to the minister's satisfaction, which C-RNA had not done in this case.
Standard of review
The Federal Court of Appeal further rejected C-RNA's arguments that the Federal Court had erred in its standard of review analysis. It agreed with the Federal Court's reasoning that many of C-RNA's challenges to procedural fairness were in fact substantive in nature and, therefore, correctly assessed on a reasonableness standard. Although the Federal Court had rendered its decision after the Supreme Court of Canada's decision in Vavilov,(3) the Federal Court of Appeal held that the Federal Court had not erred in not considering the Vavilov framework in its analysis, as C-RNA had neither suggested nor demonstrated that applying Vavilov would arrive at a different outcome.
Breaches of procedural fairness
Finally, the Federal Court of Appeal held that the minister had not breached its duty of procedural fairness in consulting an external haematologist, as the minister had given C-RNA proper notice and provided C-RNA with the opportunity to respond. The Federal Court of Appeal also found no evidence that the minister had led C-RNA astray by recommending but later rejecting the option to have Boluoke approved under a "professional use" designation.
C-RNA would need leave from the Supreme Court of Canada to appeal this decision.
For further information on this topic please contact Jie Fei (Christina) Pan at Smart & Biggar by telephone (+1 416 593 5514) or email ([email protected]). The Smart & Biggar website can be accessed at www.smartbiggar.ca.
(1) Canada RNA Biochemical Inc v Canada (Health), 2020 FC 668.
(2) Canada RNA Biochemical Inc v Canada (Health), 2021 FCA 2.13.
(3) Canada (Minister of Citizenship and Immigration) v Vavilov, 2019 SCC 65.