Biotech and Pharmaceuticals - Fasken Martineau


Dec 1, 2012 (5 years and 7 months ago)


Biotech and Pharmaceuticals
Regulating Natural Health Products in Canada: the Countdown Begins

By Natalie Boucratie and Paul Marcotte

Since January 1
, 2004, a new regulation has been governing the manufacture, packaging, labelling, storage,
importation of natural health products for distribution and sale as well as clinical trials on human subjects. The
Natural Health Products Regulation,
conceived to guarantee consumers access to quality, safe and effective
products and to regulate substances that are safe for over-the-counter use, was adopted under the Food and Drugs
A transition period came into effect when it was adopted.

Consumer consultations point to a need for reassurance as to the quality, efficiency and safety of natural health
products. The House of Commons Standing Committee on Health studied the issue, and its final report confirms
the need to adopt a regulatory framework that specifically addresses the distinct nature of natural health products.
The Regulation requires good manufacturing practices, better labelling, and adverse reaction reporting for natural
health products. Under the Regulation, any natural health care product that presents an unacceptable health risk
will be pulled from the shelves.

Before the Regulation was adopted, natural health products were sold as drugs or food under the Food and Drugs
Act and its regulations, as only these categories seemed appropriate. Natural health products were also subject to
the Interim DIN Enforcement Directive (1998) and the Therapeutic Product Compliance Guide (1999), which
were both replaced by the Compliance Policy for Natural Health Products
(the "Policy") and the Natural Health
Products Compliance Guide
(the "NHPCG").

a) Definition of a Natural Health Product in Canada
By definition and under the Regulation, natural health products must be safe for over-the-counter use.
There are two components to natural health products: a function component and a substance component.
The ‘‘function’’ component was designed to capture those substances that are manufactured, sold or represented
for use in:
(a) the diagnosis, treatment, mitigation or prevention of a disease, disorder, abnormal physical
state or its symptoms in humans;
(b) restoring or correcting organic functions in humans; or
(c) modifying organic functions in humans, such as modifying those functions in a manner that
maintains or promotes health.
The "substance" component, for its part, includes herbal remedies, homeopathic medicines, vitamins, minerals,
algae, bacteria, fungi, traditional remedies, probiotics, amino acids and essential fatty acids.
The expression
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"homeopathic medicines" is defined at greater length in a guidance document published on Health Canada's web

The definition excludes prescription drugs, drugs administered by puncturing the dermis and substances regulated
by the Tobacco Act.

b) Product Licences and Site Licences
In the future, no natural health product can be sold in Canada without first receiving a "product license." To obtain
such a license, the interested party must provide Health Canada with the information required in Section 5 of the
Regulation, which includes a list of the product's medicinal and non-medicinal ingredients, the recommended
conditions of use of the product, information that supports the safety and efficacy of the product, and the text of
each proposed label.
Once all of the necessary information is received, a risk assessment will be carried out. This process is described
in greater detail in the NHPCG. Basically, the product's safety and efficacy must be established to the satisfaction
of Health Canada in light of the claimed medicinal purposes.
Consumers will see that Health Canada authorized the product's sale from a label
bearing an eight-digit
identification number preceded by the letters NPN, or DIN-HM in the case of homeopathic products; this label
will guarantee the safety, quality and health claims associated with the product.
Also, any business interested in manufacturing, packaging, labelling or importing a natural health product must
first obtain a "site license" from Health Canada. All applications for such site licenses must include a statement
specifying which one or more of the activities of manufacturing, packaging, labelling or importing the applicant
wants to conduct. The activity must then be carried out in accordance with the good manufacturing practices
prescribed in Part 3 of the Regulation.
c) Good Manufacturing Practices
Good manufacturing practices are measures that set quality control and risk management standards for natural
health products. Part 3 of the Regulation sets forth the good manufacturing practices that manufacturers,
packagers, labellers and importers must comply with in the following categories in order to be authorized to sell a
natural health product: premises, equipment, personnel and quality assurance persons, sanitation and operations
programs and products.
d) Clinical Trials
Part 4 of the Regulation deals with clinical trials involving human subjects. Its purpose is to identify the clinical,
pharmacological or pharmacodynamic effects of natural health products that do not have a long history of
traditional use, including products that have not yet been authorized for sale, and to discover the therapeutic
consequences associated with the use of such products.
While the sale or import of natural health products without a product license is prohibited, an exception is made
for clinical trials, provided an application for authorization is submitted to the Minister. The application must
contain a copy of the clinical trial’s protocol, a copy of the statement of risks and anticipated benefits arising to
the health of the clinical trial subjects, a list of the non-medicinal ingredients and the dosage form of the natural
health product.

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e) Transition Period
When it came into force on February 1
, 2005, the Policy clarified several aspects of the approval of health
products that have yet to receive a drug identification number (DIN).
Although Health Canada gave itself until January 1
, 2008 to make sure that product license applications have
been filed for all natural health products, it still gave itself a working schedule that classifies products based on
their associated risks. Products presenting the greatest risks will naturally be examined first, while those
presenting the least risk fall at the bottom of the list.
In total, eight categories were created. For example, starting on June 1
, 2005, Health Canada intends to examine
products containing algae, bacteria, probiotics, fungi and non-human animal materials.
But despite this classification, Health Canada reserves the right to examine a product before the date set for that
particular category if its continued sale on the market appears to pose a health risk. In other words, if any
homeopathic medicine were today found to pose an unacceptable risk, measures would be taken to examine the
product without any further delay, even though Health Canada only intended to turn its attention to that particular
category of homeopathic medicines on July 1
, 2007.
Natural health products that already have DIN numbers can keep them until December 31, 2009, after which time
a product license must be obtained under the new Regulation. During this period of transition, the sale, packaging,
labelling and clinical trials of such products will continue to be governed by the Food and Drugs Regulation.
Manufacturers, packagers, labellers and importers have until December 31, 2005 to obtain a product license and
comply with good manufacturing practices. After that date, anyone who does not hold a valid product license will
no longer be authorized to manufacture, import, label or package natural health products destined for sale in
There is no transition period for clinical trials, which must all comply with these new rules.
All companies operating in this industry would therefore be well advised to familiarize themselves with the
deadlines that now apply and start taking the necessary steps to comply with the Natural Health Products

Natalie Boucratie practices in civil and commercial litigation, and is called upon to plead before various courts. She
has recently completed a Masters in Biotechnology Law at Université de Montréal.
Ms Boucratie can be reached at 514 397 5225 or

Paul Marcotte specializes primarily in transactional matters related to the biotechnology and pharmaceutical
industries. In this capacity, Mr. Marcotte has represented a variety of clients with different profiles, such as start-up
and public biotechnology companies, specialized venture capital funds, research centres of university hospitals and
pharmaceutical manufacturers and distributors. Mr. Marcotte has been involved in all kinds of transactions including
cross-border transactions with the U.S., spin-off of technologies developed in hospital research centres, private
financing, amalgamation and other types of technology transfer.
Mr. Marcotte can be reached at 514 397 5152 or

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1) SOR/2003-196, June 5, 2003 [hereinafter the "Regulation"];
2) R.S.C. 1985, c. F-27;
5) Schedules 1 and 2 of the Regulation;
7) S.C. 1997, c. 13;
8) The label must include the following: 1. recommended use or purpose; 2. recommended route of administration; 3.
recommended dose and duration of use; 4. risk associated with the natural health product; 5. name and address of the
product license holder and, if the product is imported, the name and address of the importer; 6. common name of each
medicinal ingredient and its proper name, when not a chemical product; 7. quantity of each medicinal ingredient and
potency, where applicable; 8. list of all non-medicinal ingredients; 9. recommended storage conditions, if any; 10. lot
number and expiry date; 11. description of the source material of each medicinal ingredient the product contains;
9) For more information on the Natural Health Products Regulation, point your browser to