Generic crop protection process costly

Canadian farmers have a competitive disadvantage compared to other producers, especially U.S. growers, because of a lack of generic crop protection pro-ducts.

In fact, Canada is one of the worst countries in which to register generic products. Canadian farmers deserve better.

The Pest Management Regulatory Agency has been criticized recently for not creating an environment that facilitates the expedient registration of generic crop protection products.

While the PMRA is responsible for ensuring the health and safety of Canadians, that is not the issue.

Generics are simply a lower cost equivalent alternative to products that are already in the market.

The discussion then turns to the impediments disrupting and delaying farmers’ access to new generic crop protection products.

To encourage innovation and investment, original registrants, known as basics, are given an exclusive marketing period to “make some money.”

We have no argument with that. As well, original registrants are entitled to fair compensation for relevant data, where that data is relied on to register a generic. Again, this is fair and reasonable.

However, it appears the PMRA is favouring original registrants by giving them far too much opportunity to control and manipulate the process and making it almost im-possible for the generics to navigate the process and register generic products.

The real reasons for the delay and for generic companies pulling out of the process are bad regulation and policy, in most cases favouring the original registrants.

Let’s take a step by step look at the registration process after a generic crop protection product submits notification of application:

The PMRA creates a compensable research and development data list and allows the original registrant input as to what should be on the list.

The generic applicant has no recourse to look at the list or appeal the list to suggest that a study may be ineligible for inclusion, before it is ratified. Basics 1, generics 0.

A 120 day negotiation process to determine the level of compensation for original data begins between the basic registrant and the generic.

The basic can delay this process at will and force arbitration by asking for an unreasonable amount that the generic can’t afford to pay, even though the generic may already be offering what the data is actually worth. Basics 2, generics 0.

Before it goes to arbitration, the generic has the ability to post escrow and immediately register and market the product while arbitration takes place.

However, the PMRA apparently thought this was too much of an opportunity for generics, so it decided that the basic registrant determines the amount of escrow. Basics 3, generics 0.

Final offer arbitration begins with a 120 day timeline. At the end, the arbiter rules in favour of either offer. The problem is that the PMRA insists it has to be binding arbitration, re-gardless of whether the registration proceeds.

Generic companies have implored the PMRA to change it to be binding only if and when the registration actually takes place. In other words, even if the generic decided it can’t afford to move ahead because of the arbitration ruling, it would still have to pay compensation for data that no one relied on. Basics 4, generics 0.

Ironic then, that in its own policy overview the PMRA states: “The PPIP (protection of proprietary interests in pesticide) policy aims to provide favourable conditions for generic pesticide producers to enter the pesticide market and to increase the selection of products available for the user.”

In the United States, a generic applicant submits an offer to pay, the product is immediately registered after the Environmental Protection Agency has done its due diligence and the product is in the market while the negotiations and arbitration take place between the original registrant and the generic applicant.

The U.S. timeline to market is five to six months for equivalency. The Canadian timeline to market is a minimum of 18 to 24 months, if at all.

This is why only 15 percent of Canadian crop protection products are lower cost generics compared to 50 percent in the U.S.

This is why Canadian farmers continue to annually spend tens of millions of dollars more than U.S. farmers. And this is also why some generic companies have abandoned their generic applications and are contemplating pulling out of the Canadian industry altogether.

Bob Friesen is chief executive officer of Farmers of North America Strategic Agriculture Institute. This article has been edited for length.

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