Canada’s top pharmaceutical lobby group paid Statistics Canada to produce a series of customized reports that painted a flattering picture of their contribution to the country’s economy, documents reveal.
Innovative Medicines Canada (IMC), which represents dozens of pharmaceutical companies, then used those reports as part of its lobbying and public relations campaigns without disclosing that it paid for the analysis.
Leading academic experts criticized the reports for exaggerating pharmaceutical companies’ investment in research and development (R&D) and suggested they could serve to justify the government’s “cozy relationship” with the industry.
Statistics Canada has not disclosed that the lobby group paid for the reports, which are published on the government’s website.
The documents, which were obtained through an access to information request, include a letter of agreement showing that the lobby group was allowed final approval over “the indicators or concepts” used in the reports.
Later email correspondence shows the lobbyists made changes to the Statistics Canada report and to various indicators that would appear in the final version.
IMC paid Statistics Canada $161,072 for two of the reports published in 2021 and 2022. The cost of the third report was not released.
The lobby group’s efforts are part of a long-simmering conflict between pharmaceutical companies and Canada’s drug pricing regulator over the industry’s failure to meet its R&D commitments to the country.
The industry is trying to put the best spin on their broken promise to invest more in R&D in exchange for patent protections that have raised the price of drugs, with the Statistics Canada report becoming a key instrument in the campaign.
The conflict is one front in a larger fight over the power of the pharmaceutical industry, which last month broke open over price reforms that would have saved Canadians billions on drug costs.
An investigation by The Breach revealed that Canada’s health minister intervened with the drug pricing regulator to suspend the reform process, a revelation that has sparked parliamentary hearings next month.
‘Reads like an infomercial for the drug industry’
The access to information documents were originally obtained by Marc-André Gagnon, a pharmaceutical policy researcher and associate professor at Carleton University.
Gagnon filed the request to find out how IMC knew about the 2021 Statistics Canada report weeks before it was available to him on the government website.
“They had privileged access to the research,” Gagnon said. “I wanted to understand how this is the case.”
Gagnon was stunned by what he discovered.
“It came as a surprise that a lobby group can commission Statistics Canada to write a report and have a say in the type of indicators that will be used, and basically have a veto right on the contents.”
“For me the report reads like an infomercial for the drug industry, and that’s a problem.”
Gagnon highlighted an inconvenient indicator that was dropped from one section of the Statistics Canada report at the lobby group’s request.
In late December 2021, just as that year’s report was being finished, IMC wrote to Statistics Canada with some final changes that included cutting a section of the report dealing with research “intensity measures.”
“We feel it is not aligned with the scope of the work,” they wrote. “We would request it not to be included.”
“Thanks for the feedback,” responded Gregory Maloney, chief of Statistics Canada’s research and development, investment, science and technology division. “I will immediately action the changes.”
It was an important omission because research intensity–comparing R&D spending to total pharmaceutical sales—is the measure used to determine if the companies are meeting their R&D commitments.
“The inclusion of these numbers would clearly show how IMC was shortchanging Canadians on R&D investments as compared with their commitments,” Gagnon wrote.
Statistics for sale?
What emerges from almost 300 pages of emails obtained through the access-to-information request is a cordial and accommodating staff at Statistics Canada working closely with IMC to produce the reports, which were published under the title The Canadian Research and Development Pharmaceutical Sector.
“Here is the list from IMC…This is a high priority project…So off to the races,” wrote research and development chief Maloney to other staffers on Oct. 8, 2020.
Throughout the fall and winter of 2020, Statistics Canada staff worked with IMC to complete the first report. Emails show the lobby group was anxious to have the final version publicized.
“Just checking in before the weekend if there has been any progress on publication details so I could inform our comms team,” an IMC staff person wrote to Maloney on March 26, 2021. The name of the IMC staff person was redacted.
“The study is not yet on our website but it will be published under our Analysis In Brief series, and the public will be informed of this through Statscan’s The Daily,” Maloney responded. “I will push to have this released at the end of April or beginning of May for sure. Would this work for you?”
The lobby group insisted that its branding word “innovative” be inserted into the report and that its members be described as Canada’s largest pharmaceutical companies.
In that exchange, Statistics Canada pointed out that it would be incorrect to refer to the IMC companies that way because the generic drug manufacturers were left out of the analysis.
“Could we substitute with “the members represent some of Canada’s largest pharmaceutical companies,” Maloney asked.
The lobby group wrote back: “To clarify it should read ‘Canada’s largest innovative pharmaceutical companies’ as this is the term we use.”
“We have made the changes,” Maloney responded.
“We really enjoy working with your organization and look forward to future collaborations,” Maloney wrote to IMC on the day the second study was released in early 2022.
In an email to The Breach, Statistics Canada said it has been producing commissioned reports for a long time.
“Statistics Canada has a long history of making custom survey and analysis services available, as well as custom tabulations and data integration, on a cost-recovery basis for a wide range of organizations in Canada,” a spokesperson said in an email.
“Statistics Canada strictly adheres to international norms and as such does not compromise to suit any organization’s specific interests.”
On its website, Statistics Canada even offers to market customized reports. “Disseminators and communicators ensure that your survey receives as widespread attention as you wish.”
What is not clear is Statistics Canada’s policy on disclosing that an organization paid for a report. None of the reports disclose IMC funded and helped write and shape the report.
The Breach’s questions to Statistics Canada about disclosure were not answered.
IMC told The Breach in an email that the reports are an annual engagement between Statistics Canada and the pharmaceutical lobby group.
“There is full transparency in the Statistics Canada reports that this study is commissioned by IMC, and while we can request what should be measured—namely economic contribution, jobs, and R&D investments—the independence of Statistics Canada is integral to their work and findings,” IMC’s president Pamela Fralick said in an email.
When asked by The Breach to point to those transparency disclosures, IMC responded ”that question is best directed to Statistics Canada.”
The first two reports did not include any disclosure of IMC’s involvement.
In the third report, released after Gagnon made his access to information request, Statistics Canada does state that the report was “commissioned by IMC.”
But Statistics Canada does not make it clear that IMC paid for the reports, had final approval over the indicators, and was allowed input into the writing of the report.
‘Biased studies’ could ‘rationalize weak stance’ of government: expert
In a paper published last week in the journal Healthcare Policy, Gagnon writes that the situation has revealed a “serious concerning intimacy between Statistics Canada and an industrial lobby group.”
Why does a technical statistical report on pharmaceutical R&D investment matter? It goes back to the long-festering dispute over the original deal that the industry made with Canada in exchange for longer patent protections.
Back in the late 1980s, the industry pledged that every year it would invest 10 per cent of its sales into Canadian research and development. In exchange, Canada granted the industry 20 years of patent protection from competition.
Yet there has been no increase in R&D investment. That’s because, for the last 20 years, the pharmaceutical industry has failed to live up to its end of the bargain.
Instead of investing the promised 10 per cent of sales in R&D, the most recent analysis reveals IMC members investing just 3.5 per cent, the lowest among all of the countries Canada uses for drug price comparisons.
In press releases and in filings with Canada’s lobbyist registry, industry players have said they want to change the definition of R&D.
The ultimate goal is to expand the types of activities that can be considered R&D, using a definition that could include activities such as grants to patient groups or other forms of investment that are not directly related to advancing research.
That expanded definition is used in the Statistics Canada report, which the IMC then cited in recent pre-budget consultation documents presented to the Alberta, Ontario and federal governments.
“The involvement of an industry association in the design and interpretation of a government report on said industry is extremely problematic,” said Steve Morgan, a professor with the University of British Columbia’s School of Population and Public Health, in an email.
“It is the job of policy makers to prevent these conflicts and biases in the first instance. Unfortunately, however, the federal government has allowed cozy relationships and resulting biases to develop in its management of pharmaceutical policy in recent years.”
Morgan suggests the Statistics Canada report could also be useful for the federal government to justify its close relationship with the industry. He called it a case of “decision-based evidence-making.”
“If Trudeau and his cabinet have already caved in under pressure from the pharmaceutical industry on key matters—such price regulations and pharmacare, for example—then biased studies might be just what they want so they can rationalize their weak stance when their policies come to light in upcoming elections,” Morgan said.
“I hope I am wrong about that because Canadians deserve better.”