Canada regulations make for a "challenging" market

The recent changes to the Canadian NHP regulations offer improved visibility and allow NHP suppliers to better plan their sales and marketing efforts. However, they have also slowed time-to-market for new product innovations, which is very frustrating for the industry as a whole.

In Canada, the Natural Health Products (NHP) market has encountered a number of regulatory obstacles in recent months. Health Canada's Natural Health Products Directorate (NHPD) has been unable to efficiently process product license applications since the division was created back in 2004 and this has resulted in a perpetual backlog of applications. Until recently, NHP suppliers were permitted to bring their products to market with a submission number, thereby allowing consumer access to NHPs while regulators work through the backlog. However, a surprise directive by the National Association of Pharmacy Regulatory Authorities early in 2010 forced the NHPD to enact amendments to regulations in order to address the backlog. Although the amendments are well-meaning, they are a far-from-ideal solution to the issue.

The recent changes to the Canadian NHP regulations offer improved visibility and allow NHP suppliers to better plan their sales and marketing efforts. However, they have also slowed time-to-market for new product innovations, which is very frustrating for the industry as a whole.

Although NHP suppliers can no longer go to market solely with submission numbers, the creation of Exemption Numbers (ENs) allows them to ship products to retailers while their product license applications sit in the queue for evaluation.

An EN is in essence a temporary license that allows a product to reach consumers while the license application awaits regulatory review. One issue is that an EN will only be granted if an application has not been reviewed within 180 days. Because a cursory safety review is required at the front-end of the process, and other delays at the back-end, in reality an NHP supplier is looking at 240 or 250 days before they have their EN. That's an awfully long time to wait to get a product to market!

Furthermore, if, after a product has been launched with an EN, the NHPD (upon eventual review of the license application) concludes that the product does is not backed by sufficient scientific evidence to support efficacy, the NHP supplier may be forced to remove the product from the market. That makes for a great deal of business risk out there — NHP suppliers are basically at the mercy of our regulators. It's a very challenging environment.

Dark clouds notwithstanding, at the same time Canada still offers a highly lucrative market for NHP suppliers and those with innovative formulas that blend quality with science are likely enjoy long-term success.

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