Canada: Federal Court Finds No Procedural Unfairness In Minister Of Health's Decision That Smoking Cessation Aid Not A Natural Health Product

On November 2, 2023, the Federal Court dismissed The Winning Combination (TWC)'s application for judicial review of Health Canada's decision to refuse a natural health product licence for Resolve, a smoking cessation aid: Winning Combination Inc v Canada (Attorney General), 2023 FC 1465.

Background

The present decision is the latest entry in a lengthy procedural history regarding Health Canada's review of Resolve.

On April 6, 2016, in response to TWC's first application for judicial review, the Federal Court quashed Health Canada's previous decisions and ordered the Minister of Health to grant a product licence for Resolve. Justice Russell's findings included a lack of procedural fairness, a reasonable apprehension of bias, and unreasonableness (Winning Combination Inc v Canada (Health), 2016 FC 381). On appeal, the Federal Court of Appeal did not disturb the Federal Court's factual findings, but remitted the matter to the Minister for redetermination within 90 days (Canada (Health) v The Winning Combination Inc, 2017 FCA 101).

TWC objected to Health Canada's proposed redetermination process in a further application for judicial review. On October 29, 2019, the Federal Court determined that the objection was premature (The Winning Combination Inc v Canada (Attorney General), 2019 FC 1014).

The question at issue on the redetermination was whether the active ingredient in Resolve was a naturally present constituent of passionflower, and therefore an extract of a plant material with primary molecular structure identical to that which it had prior to its extraction or isolation, as per Schedule 1 of the Natural Health Product Regulations (NHP Regulations). The redetermination process included (i) laboratory testing by three independent laboratories, (ii) analysis by an external expert panel and (iii) a redetermination meeting with representatives from all parties and the external panel. Regarding testing, TWC requested that the laboratories use the same methods from TWC's own previous tests. Regarding the panel, TWC and Health Canada each had input into selecting one of three members.

The panel issued a report, which was then discussed at the redetermination meeting. On February 6, 2020, the redetermination process culminated with Health Canada's decision (Decision), consistent with the panel's report, that "there is no reliable evidence that Resolve's confidential active ingredient is a naturally present constituent of passionflower." Resolve therefore did not meet the definition of a natural health product and was not entitled to a product licence.

TWC sought judicial review of the Decision.

Analysis

TWC argued that the process was procedurally unfair and ultra vires. In particular, the FCA decision did not contemplate Health Canada's lengthy fact-finding process and the NHP Regulations did not grant Health Canada the power to conduct or order laboratory testing, or gather or hear new evidence.

The Federal Court explained that questions of procedural fairness are not decided according to a standard of review, but by determining whether the procedure was fair having regard to all of the circumstances. In previous cases, applicants under the NHP Regulations have been entitled to a degree of procedural fairness on the "mid-to-low end of the spectrum."

Justice Elliott determined that TWC received procedural fairness. "TWC was directly involved in the process." Further, the NHP Regulations do not prohibit laboratory testing.

"TWC had notice of the process, was provided with all of the lab results and had a full opportunity to address both the process, and the results, before the Panel", even if it could be said to contravene TWC's legitimate expectations.

TWC may appeal as of right.

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