On July 24, 2026, Health Canada published the Final Report of the Pharmaceutical and Life Sciences Sector Task Force to the Ministers of Health and Industry. The Task Force was launched in March 2026 as a joint federal initiative of Health Canada and Innovation, Science and Economic Development Canada. The Task Force’s mandate was to support reliable and sustainable access to pharmaceutical products in Canada and identify made-in-Canada solutions that drive innovation, competitiveness and long-term growth in the life sciences sector. Task Force members were recruited from the pharmaceutical and life sciences sectors and included senior leaders and subject matter experts from national industry associations, pharmaceutical manufacturers, biotechnology firms and regulatory, policy and research partners.
What are the Conclusions of the Final Report?
The Final Report notes that Canada underperforms relative to its peers, despite possessing all of the potential and essential ingredients to become both a global leader in the pharmaceuticals and life sciences industry and a preferred destination for life sciences investment and innovation. Several fundamental challenges are identified as barriers to realization of Canada’s potential:
- Canada is slower to provide access to innovative medicines, in part in part because value assessment, price negotiation and provincial drug program coverage decisions move slowly and in part because pricing policy is built around cost containment (leading global companies to deprioritize Canada for launches, clinical trials and investment).
- Despite Canada’s strong research infrastructure, fragmentation across funding programs, translational infrastructure, and industry-academic partnerships creates a sub-optimal path for the translation of life sciences discoveries into venture-backed companies.
- Canada is underperforming in clinical trial activity due to structural barriers, a complex regulatory path, fragmented investment and weak data infrastructure, and drug reimbursement policies.
- Canada lacks the connected health data infrastructure needed to leverage AI and enable measurement of value/outcomes and healthcare savings from innovation.
- Canada has a shortage of domestic late-stage capital, resulting in the flight of venture capital-backed innovative life sciences companies to other jurisdictions.
The Final Report notes that the collective impact of these challenges has been a progressive erosion of domestic and foreign direct investment from both innovative and generic pharmaceutical industry that is weakening Canada’s health sovereignty. The Canadian government is urged to take deliberate, bold and swift action to make the changes needed to create a world-leading pharmaceutical and life sciences industry. This is framed as both an urgent need and a unique opportunity in light of the current geopolitical environment. The Final Report makes a number of recommendations in furtherance of such changes.
What are the Recommendations?
Thirty-nine recommendations were made across seven areas with phase-in timelines dependent on subject matter and complexity.
- Reducing regulatory burden. The Final Report calls for Health Canada to expand its proposed "reliance” framework for innovative drugs, under which it would rely on trusted foreign regulators for drug approvals, inspections and lifecycle management (with a particular emphasis in areas where reliance can have the greatest impact for patients (e.g. oncology, HIV, antimicrobial, vaccine and rare disease products). The Final Report also recommends streamlining processes through rolling reviews, a dedicated navigator for sponsors during the regulatory review process, exemption of low-risk administrative changes from new regulatory submissions and establishing a standing industry technical working group for review processes. The Final Report also advocates for a dedicated program for domestic developers of advanced therapies modelled on existing European Medicines Agency and U.S. Food and Drug Administration programs.
- A rethink of how Canada assesses value and negotiates drug prices. The Final Report calls for the development of a multi-dimensional framework emphasizing clinical/patient value, health system value and societal value as part of health technology assessments (HTAs). It is recommended that there be greater coordination between Health Canada, Canada’s Drug Agency (CDA) and the pan-Canadian Pharmaceutical Alliance (“pCPA”). Canada is urged to review its pricing policies and frameworks for innovative drugs in light of the current geopolitical context, including the current focus on net prices, as well as Canadian sovereignty and security of supply. The pCPA is also encouraged urged to consider the value of innovation when negotiating pricing, reconsider its consensus-based negotiation approach and to work with provinces and territories to achieve listing agreements within 30 to 60 days of a letter of intent. The Final Report further calls on the Canadian government to consider whether the model of international price referencing and list-price monitoring employed by the Patented Medicine Prices Review Board (PMPRB) remains appropriate. Modernization of the research and development reporting requirements by PMPRB is also recommended.
- Rebuilding Canada’s position in clinical trials. The Final Report calls for maintenance and promotion of the 30-day clinical trial application review standard, which represents a global competitive edge for Canada. National harmonization of research ethics approvals is recommended, as well as standardization of contracting frameworks and operational procedures across institutions.The Final Report advocates improving national trial coordination, investing in coordinated trial infrastructure and promoting and funding high-impact clinical trials. It is also recommended that consideration be given to extending eligibility for the Scientific Research and Experimental Development (SR&ED) tax incentive to corporations that are not Canadian-controlled.
- Sovereign health data to power AI and real-world evidence. The Final Report calls for leveraging of national health data infrastructure to facilitate adaptive and digitally enabled trials, real-world evidence trials, enhanced measurement of health innovation outcomes and system impact, the generation of healthcare system efficiencies and the creation and scaling of health IT companies in Canada. Collaboration with middle powers on health data related applications, and investment in the development of health AI is also recommended.
- Closing the gap between research and commercialization. The Final Report advocates for a federal coordination function to link the health and innovation portfolios to overcome fragmentation. The Final Report also recommends improving alignment, stability and accountability across translational research programs to bridge gaps from discovery to clinical development and patient access. Other recommendations include possible development of an initiative modelled on the U.S. Small Business Innovation Research (SBIR) program (to support companies from discovery to commercialization), investment in biohub incubation infrastructure, a federal tax credit for early-stage investments, and leveraging the Government of Canada Venture Capital Catalyst Initiative (VCCI) to stimulate private investment in Canadian-based earlier-stage venture capital funds.
- Capital to build and keep Canadian anchor companies. The Final Report calls for creation of a nationally anchored late-stage capital vehicle through the Canada Strong Fund or an expanded Canada Growth Fund mandate, as well as measures to encourage Canadian pension funds and insurers to participate in late-stage life sciences venture funds. It is also recommended that defined “Canadian anchor company” criteria be developed based on headquarters, leadership, intellectual property (IP) retention and domestic footprint. The Final Report also advocates for a Canada-first regulatory strategy to support anchor companies and possible creation of a Canadian biotechnology index, potentially hosted through NASDAQ.
- Treating drug supply as industrial strategy. The Final Report calls for mapping domestic life sciences assets, prioritizing strategic niches and a product policy framework that creates market certainty for medicines backed by Canadian investment. It is also recommended that there be stronger procurement tools to support and sustain domestic investment and supply capabilities. Supply diversification is encouraged through partnerships with trusted countries, as well as engagement of the life sciences sector under Canada's Defence Industrial Strategy, with a focus on active pharmaceutical ingredients, vaccines and critical medicines.
What Does This Mean for the Life Sciences Sector?
While the government of Canada has yet to comment on any specific actions that will be taken in response to the Final Report, there are several actions that might be taken immediately to address some of the issues raised, in particular in relation to Canada’s pricing and reimbursement environment. Note that we raise these as theoretical courses of action, since the Final Report does not advocate for these specifically.
- The Final Report notes more than once that Canada's pharmaceutical policy landscape is oriented toward affordability and cost containment. A key aspect of this landscape is the PMPRB, which evaluates patented drug prices for excessiveness. The Final Report cites a recent report of the US Trade Representative which remarked that exclusion of Switzerland and the US from the PMPRB’s basket of international price reference countries artificially devalues innovative medicines in Canada. This citation is notable when taken together with the call to consider whether the PMPRB’s international price referencing model and list-price monitoring remains appropriate. An immediate action that might be taken would be to reinstate Switzerland and the US in the basket of international price reference countries.
- The Final Report notes that, after approval by Health Canada, a drug typically faces cumulative delays to reimbursement consisting of approximately 200 days for HTAs, 195 days for price negotiations with pCPA, and 99 to 219 days for provincial and territorial drug listing agreements. An immediate action that could be taken to reduce delays would be to revise review processes to enhance efforts to conduct Health Canada, CDA and pCPA processes concurrently.
- To further address pricing negotiation delays, an immediate action that could be taken would be to revise the pCPA negotiation approach to ensure consideration of the full value of innovation (rather than focussing on price) in order to balance the mandate to negotiate prices against the goal of increasing access to clinically effective treatments. Development of a harmonized drug listing agreement template to be used across jurisdictions would eliminate multiple rounds of negotiation and allow for rapid and consistent listing across the country, thereby eliminating the “postal code lottery” in access to medications noted in the Final Report.
Conclusion
Although the Final Report stops short of recommending specific amendments to the PMPRB framework or pCPA processes, the recommendations reflect a notable shift in policy thinking. Throughout the Final Report, the Task Force repeatedly links pricing and reimbursement policies to Canada's declining attractiveness as a pharmaceutical launch market and destination for investment, highlighting the need for reform.
