Canada (Health) v. The Winning Combination Inc., 2017 FCA 101

The Federal Court of Appeal has overturned an earlier decision of the Federal Court (see 2016 FC 381our summary here) relating to the non-issuance of a Product Licence Application (PLA) for the Winning Combination's natural health product RESOLVE, a smoking cessation aid.

The Federal Court had earlier found that several decisions by the Natural and Non-Prescription Health Products Directorate and its predecessor in Health Canada were made in breach of procedural fairness. Mandamus was ordered, requiring Health Canada to issue a PLA within 30 days.

On appeal, the Attorney General conceded that the licensing decision and reconsideration process under the Regulations had not been reached in accordance with procedural fairness. However, the Attorney General maintained her position that the order of mandamus be set aside and that the question of whether a Natural Product Licence should be issued in respect of Resolve be remitted to the Minister for redetermination.

The Court of Appeal agreed that the judge erred in granting mandamus for two reasons. The first related to the finding of systemic bias and the finding that no adequate remedy was available to Winning Combination. The Court of Appeal stated that the finding of bias on the part of the government officials did not, in the absence of further evidence, justify the conclusion that the Department as a whole was systemically incapable of making a fair assessment of the Winning Combinations' application.

The second error in granting mandamus related to fresh evidence provided on appeal as to whether the product is a Natural Health Product or a drug. This decision would guide which regulatory regime governs the product. It was found that a serious scientific question exists that is best addressed through an expedited redetermination, not a directed verdict.

The argument that the Minister was functus officio was balanced with the need for the Minister to ensure the safety of licenced products to be consumed by Canadians. There was nothing found in the regulatory scheme that supports the position that the Minister may not revisit all licensing requirements.

Ultimately the decision was remitted to the Minister for redetermination within 90 days of the decision. Solicitor and client costs were awarded to the Winning Combination and the prior Federal Court decision to award the Winning Combination solicitor and client costs was upheld.