How a failed deal with China to produce a made-in-Canada COVID-19 vaccine wasted months and millions

The federal government’s failed collaboration with a vaccine manufacturing company in China early in the pandemic has led to a delay of nearly two years in efforts to create a made-in-Canada COVID-19 vaccine.

Chinese vaccine company seized, deleted half of Fifth Estate interview with top executive

Prime Minister Justin Trudeau, right, speaks with scientist Krishnaraj Tiwari during a visit to the National Research Council of Canada Royalmount Human Health Therapeutics Research Centre in Montreal on Aug 31, 2020. Early in the pandemic, the prime minister promised to deliver a made-in-Canada vaccine but that has not materialized. (Graham Hughes/The Canadian Press)

The federal government's failed collaboration with a vaccine manufacturing company in China early in the pandemic has led to a delay of nearly two years in efforts to create a made-in-Canada COVID-19 vaccine.

Government documents obtained by The Fifth Estate show that Canadian officials wasted months waiting for a proposed vaccine to arrive from China for further testing and spent millions upgrading a production facility that never made a single dose of COVID-19 vaccine. 

The National Research Council of Canada (NRC) signed an agreement with Tianjin-based CanSino Biologics in early May 2020 to "fast-track the availability of a COVID-19 vaccine in Canada for emergency pandemic use."

The CanSino vaccine, which had been created by the scientific research arm of China's military, was to be shipped to Canada for human trials that May. If successful, the vaccine was to be manufactured at a temporary facility in Montreal that the NRC had committed $44 million to upgrade.

Watch | The Vaccine: What went wrong?

The documents reveal that the NRC, the scientific research arm of the Canadian government, was gearing up for production of the vaccine — even before the contract was signed and human trials had started — estimating it could be manufacturing doses by summer 2020.

At first, the NRC would be producing doses for human trials in Canada, then later, according to the contract, "for front-line responders and Canadians as soon as they are available."

The CanSino-Canada deal was originally hoped to quickly provide vaccines for emergency use by front-line responders. (Leah Hennel/Alberta Health Services)

"Once fully operational, in the event that CanSino proceeds, NRC will be able to produce 70,000 to 100,000 doses per month," the NRC briefs said.

The NRC asked Dr. Scott Halperin, director of the Canadian Center of Vaccinology in Halifax, to design the clinical trials for CanSino in Canada.

"The NRC and CanSino had previous collaborations well before the pandemic," Halperin said in an interview with The Fifth Estate. "That was leveraged into a working relationship to say: 'Can that be expanded for the current crisis?' "

Vaccine stuck in China

As the months progressed, the documents also show that the NRC was working to increase the number of doses the facility could produce for the public.

But ultimately, the CanSino vaccine would never get to Canada.

Prime Minister Justin Trudeau announced the deal to Canadians on May 16, 2020. But a federal government memo later that same month reveals the Canadian Embassy in Beijing was still working to get the vaccine cleared by China's customs.

"CanSino vaccines are still with customs in China," the memo said. "Embassy has a [meeting] tomorrow. Assuming they get through customs [tomorrow], they can be put on a flight on the 27th."

But the vaccine candidate was not put on a plane on May 27.

That same day, Huawei CFO Meng Wanzhou — a high-profile tech executive in China — lost an appeal to the B.C. Supreme Court arguing against her arrest in Canada. Meng had been detained in Vancouver in 2018 on U.S. bank fraud charges.

(Meng was returned to China last month after signing a deferred prosecution agreement with the U.S. Attorney General's Office. Shortly after, two Canadians held in prisons in China were allowed to return to Canada.)

Huawei CFO Meng Wanzhou waves as she steps out of an airplane after arriving at Shenzhen Bao'an International Airport in Shenzhen in southern China's Guangdong province on Sept. 25, 2021. Meng signed a deferred prosecution agreement with U.S. prosecutors that allowed her to leave Canada for the first time in nearly three years. (Jin Liwang/Xinhua/The Associated Press)

"I was incredulous that the government had chosen to partner with not only CanSino, but with China, after all the things that had happened," Conservative MP Michael Chong said.

Chong has served as the party's foreign affairs critic and on the parliamentary committee on Canada-China relations. 

"It was clear by May of 2020 that China was not a reliable partner," he said.

Michael Chong, a former Conservative foreign affairs critic, has been outspoken regarding national security issues and China's human rights record. (Joe Fiorino/CBC)

On June 19, 2020, only weeks after Meng lost her court appeal, China accused Canadians Michael Kovrig and Michael Spavor of espionage. They had already been held in Chinese prisons without charges for more than 500 days.

A war of words ensued between the governments in China and Canada, with officials from each country criticizing the other.

WATCH | McGill professor says connection to China's army risky:

Security professor doubts customs stopped the vaccine

1 year ago
Duration 0:59
Ben Fung, a security researcher with McGill University, tells The Fifth Estate's Bob McKeown that a partnership with a company closely tied to China's military would be risky.

By June 26, NRC bureaucrats acknowledged in briefs that the "shipment of vaccine material has stalled." 

By early July, the CanSino candidate was still the only vaccine Health Canada had approved for human trials in Canada. NRC officials continued to hope it would arrive later that month.

"CanSino remains very committed to the Canadian clinical trials," the brief said.

Into August, NRC documents reveal, officials continued working on manufacturing plans, despite the fact that the vaccine candidate had "not yet been approved by Chinese customs for shipment to Canada."

Customs not the problem

Ben Fung, a security researcher at McGill University in Montreal and an outspoken China critic, said he doubts that customs was the issue, and argued that Canada should have known partnering with CanSino was risky because of the company's connection to both China's military and government. 

"So when they say customs is stopping the vaccines, of course this is not the case," Fung said. "The [Chinese Communist Party] is upper management."

WATCH | The original plans for the CanSino-Canada vaccine:

The CanSino-Canada vaccine plan

1 year ago
Duration 2:09
The Fifth Estate's Bob McKeown looks at the plans for a CanSino-Canada vaccine partnership by hearing from CanSino's Canadian scientific adviser, Dr. Luis Barreto, who is a longtime vaccine specialist, and Dr. Scott Halperin, who was hired to run clinical trials for the company.

At the Center for Vaccinology, Halperin suspected that the project had become wrapped up in the diplomatic tensions between Canada and China. When he saw the vaccine had been shipped to Pakistan and Russia without issue, he knew the vaccine was not coming to Canada.

"Then we knew it wasn't just the right paperwork and bureaucracy," Halperin said. "It became clear that that wasn't the case, but that took another month to two months to finally decide that no, it must be politics. It can't be anything else."

The Globe and Mail first reported on Aug. 25, 2020, that the NRC had abandoned its collaboration with CanSino because China wouldn't let the vaccine doses come to Canada.

WATCH | CanSino's CEO on why the vaccine didn't come to Canada:

CanSino CEO on why the vaccine didn't come to Canada

1 year ago
Duration 1:20
Dr. Xuefeng Yu, co-founder of CanSino, says he had hoped to get the vaccine into Canada, the country where his family lives. He tells The Fifth Estate's Bob McKeown how that unfolded.

In an interview with The Fifth Estate, CanSino CEO Dr. Xuefeng Yu said he did not know why the vaccine wasn't allowed to be sent to Canada.

"I don't work for the government, either side. I really have no clue what's going on behind the doors of the department of ... each country."

Yu said that by the time the shipment was delayed into August, there was no point proceeding with trials in Canada. By then, CanSino was already in Phase 3 global trials elsewhere.

Millions of doses promised

Trudeau and Industry Minister Navdeep Bains held a media conference at the NRC on Aug. 31, 2020, touting the Montreal lab that had been upgraded to produce the CanSino vaccine.

Even though the federal government no longer had a vaccine partner, the Prime Minister's Office announced that the facility would "enable the preliminary production of 250,000 doses of vaccine per month starting in November 2020."

However, that facility did not produce 250,000 doses of vaccine in November 2020, or any month since. 

"One would hope that when the prime minister speaks, he knows what he's talking about and it's accurate," NDP MP and health critic Don Davies said in an interview with The Fifth Estate.

"So he either was mistaken or he was misleading, and I think it's incumbent on him to explain which of those it is. What we do know is that we didn't produce 250,000 doses in Canada in November in Montreal."

Don Davies was the NDP health critic when the CanSino vaccine deal was discussed at a parliamentary committee. (Ian Christie/CBC)

To this day, no vaccines have been produced at that NRC facility.

In August 2020, Trudeau also announced that a new NRC lab in Montreal would be producing two million doses a month by mid-2021.

That has also not happened. According to the NRC, vaccines will not be produced there until 2022, at the earliest.

Trudeau, right, alongside Minister for Economic Development Melanie Joly, left, and Minister of Innovation, Science and Industry Navdeep Bains arrive for a news conference and visit to the National Research Council of Canada Royalmount Human Health Therapeutics Research Centre on Aug. 31, 2020. (Graham Hughes/The Canadian Press)

The Prime Minister's Office did not answer when asked to explain the discrepancy between the promised production numbers and what happened. The prime minister and his ministers also declined interview requests about Canada's early vaccine production plans, including with the NRC and CanSino.

The NRC has said the U.S.-based vaccine developer Novavax will be its new partner for this facility, but Health Canada has not approved its vaccine yet.

The National Research Council of Canada is adding two manufacturing facilities for vaccines at its campus in Montreal. One will make vaccines for use in clinical trials and the other will produce vaccines for public use. (Vianney Leudiere/Radio-Canada)

The NRC declined interview requests with its officials but provided written responses to questions.

"It was deemed prudent to seize the opportunity to obtain access to CanSino's vaccine candidate — one of the most advanced at the time," the NRC said.

The NRC also acknowledged that the failure of the CanSino deal forced it to scrap its original clinical trial manufacturing plans. 

"I think there's no doubt it has set us back years," Davies said. "When you're in a global pandemic, that is deadly, that costs lives."

CanSino seizes Fifth Estate interview

Yu is proud of CanSino's COVID-19 vaccine that's going into millions of arms around the world.

The company CEO sat down with The Fifth Estate for a wide-ranging interview, discussing his roots in Canada's pharmaceutical industry, his family who still lives in Toronto and his research work with China's military.

"I see them as collaborators, it's just a research institute, right?" Yu said.

CanSino Biologics Inc. is headquartered in Tianjin, China, an industrial city southeast of Beijing. The company has a large manufacturing facility and offices at the site. (Tribal Productions Asia)

But when the cameras turned off, he was clearly not happy with how the interview unfolded.

As the CBC freelance camera crew packed up their gear in the CanSino Biologics offices in Tianjin, China, company officials seized the interview recording.

CanSino deleted half of the recording before giving it back 10 days later. Luckily, The Fifth Estate recorded the entire interview from Toronto.

China officials may have denied the CanSino vaccine candidate to Canada, but Canadian scientists and labs are still supporting CanSino's COVID-19 vaccine, which is being used in at least nine countries.

A health-care worker injects a teacher with a dose of the CanSino COVID-19 vaccine in Mexico City. CanSino's vaccine has been approved for emergency pandemic use in a handful of countries worldwide. Phase 3 trials are ongoing. (Marco Ugarte/The Associated Press)

The Center for Vaccinology in Halifax continues to work for CanSino, with Halperin running the company's Phase 3 global trials on a $3.5-million contract.

"That vaccine will likely never come to Canada at this stage. It's going to be used around the world in other places, but not in Canada," Halperin said. "I look at this as a part of Canada's contribution to the global battle against COVID-19."

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