Canada relies on foreign regulators for the majority of drug manufacturer inspections — but one of its biggest partners is falling behind

New data obtained by CTV News from Health Canada shows that 85 per cent of inspections of drug manufacturing sites supplying the Canadian market were conducted by international regulators—not Health Canada. (Guteksk7 / Getty Images)

Drug manufacturers are tasked with formulating and producing the medications millions of Canadians take each day, from antibiotics to blood pressure medications.

We trust them to stick to strict standards — because quality issues can compromise treatments, worsen health outcomes, and in the most severe cases, make patients seriously ill.

New data obtained by CTV News from Health Canada shows that 85 per cent of inspections of drug manufacturing sites supplying the Canadian market were conducted by international regulators — not Health Canada.

Given the scale and complexity of the global pharmaceutical supply chain for both brand name and generic drugs, reliance on partners is necessary.

But the United States, which Canada relies on for 70 per cent of these inspections, has been facing an inspection backlog and remains behind its pre-pandemic inspection levels. Experts are raising concerns about how well the system can safeguard Canadians from substandard or dangerous medications.

David Ridley is a health economist at Duke University in North Carolina who has studied the U.S. Food and Drug Administration (FDA) drug manufacturer inspection system in the United States.

He said recent cuts to the regulator as part of the Department of Government Efficiency (DOGE) “are disruptive and very stressful for FDA staff, but the problems with inspections date back for years, even decades.”

“Many of these establishments are not being inspected by Canadian or U.S. officials,” said Ridley. He warns of the risks of lax oversight, and “we might get low quality products, products that don’t work as well, aren’t as stable, and in a very worst-case scenario…are toxic.”

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U.S. inspections took a nosedive during the pandemic. Last year the Associated Press reported that nearly 2,000 drug plants were overdue for inspections.

The U.S. Government Accountability Office, an independent government agency that audits government activities at the request of congressional committees, has flagged the area of drug supply chain oversight as “high risk” since 2009. The office said in a 2024 report that it “has had long-standing concerns about FDA’s ability to oversee the increasingly global drug supply chain.”

Matthew Herder, professor of law and medicine at Dalhousie University, specializes in the regulation of pharmaceuticals in Canada. He said knowledge that the biggest and most sophisticated regulator in the world is thin on the ground could potentially encourage lax practices. “I worry that people will start to cut corners,” said Herder.

Past failures reveal the stakes

The drugs Canadians take are manufactured around the world. In 2024, 30.8 per cent of Canada’s pharmaceutical imports originated from the United States, at least 33.5 per cent from European countries, 3.2 per cent from India, and 2.9 per cent from China — according to trade data from Statistics Canada.

Over the years the industry has been dogged with a series of safety lapses. In 2023, eye drops manufactured in India were recalled after contamination with drug resistant bacteria was discovered. The products were traced to three deaths and eight cases of blindness in the United States, according to the New York Times.

The FDA reported more than 100 people died after taking a common blood thinner that was recalled in 2007 due to contamination with an unnatural chemical during manufacturing in China. Reporter Katherine Eban’s 2019 book Bottle of Lies chronicled profit-motivated fraud and deceit at Indian generic pharmaceutical company Ranbaxy in a decade-long investigation.

In recent years in Canada, drugs have been recalled for manufacturing issues like microbial and latex contamination. Mina Tadrous, the Canada research chair in real-world evidence and pharmaceutical policy and an associate professor at University of Toronto, estimates that the 2018 recall of valsartan for nitrosamine impurities (considered probable human carcinogens) led 200,000 patients to switch prescriptions in a single month in Canada. The recall rippled through the health care system causing disruptions for patients, doctors and pharmacists.

While toxic contamination is a worst-case scenario, the most common impact is more insidious, said Ridley. “If the product is low quality, the most likely outcome is it’s just not going to be as effective. And that’s going to be really hard for people to notice.”

Ineffective prescription drugs can lead to failed treatments, prolonged illness, drug resistance, and a loss of trust in healthcare.

“Pharmacists count on a strong regulatory system to make sure medications are safe and high-quality,” said Tyler Gogo, senior manager of communications at the Canadian Pharmacists Association in an emailed statement. He said when that system falls short, “it can cause real problems in delivering care.”

Reliance on foreign regulators

As of March 31, 2025, Canada’s drug supply relied on 927 facilities within the country and 5,024 located abroad. Last fiscal year, Health Canada conducted 312 domestic onsite inspections, 47 foreign onsite inspections and relied on information from trusted international regulatory partners like the FDA, for another 2086 site inspections.

Like the United States, Canada halted international inspections in 2020 due to pandemic-related travel restrictions. While the inspections resumed, they did not increase to make up for the missed year. However, Health Canada said it does not have any backlogs for planned inspections.

“That’s the strength of the reliance model,” said Kim Godard, Director General, Health Product Compliance Directorate at Health Canada, “everyone kind of pitches in, we’re not in the same situation in terms of creating huge backlogs.”

The number of facilities and the scope of the industry outstrips the resources of any single regulator. “It makes sense to rely on partners,” said Ridley. “The FDA is so big and the United States is so big. We have the scale. It does make sense to partner with us. But that’s conditional on being able to count on us to make those foreign trips.” But Ridley said the U.S. has struggled to staff foreign offices in India and China, major sources of active ingredients in drugs.

Regarding the situation in the United States, Health Canada’s Godard said “there’s no concern right now in Canada.” She said if a site is particularly important, gaps will be filled in by Canadian inspectors or another partner like Australia.

Industry pressures and generic drugs

Concerns about inspection protocols come at a time when parts of the industry are under increasing pressure to produce drugs more cheaply.

“I worry most about generic manufacturers because they are in this race to the bottom with their competitors,” said Ridley. He said major U.S. drug purchasers, retailers and wholesalers are looking for the cheapest generic.

Generic manufacturers in Canada face similar pressures. “There’s a potential disconnect between how we pay for drugs and our supply chain,” said Tadrous. He said though many hospitals look closely at where they source medications from, drug selection processes in Canada haven’t always considered how or where a drug is made.

“For a very long period of time they have been agnostic to how drugs enter the country and the regulator and the payers have sort of been separate,” he said.

Generics make up about 20 per cent of product sales by value and 75 per cent of the market share by prescriptions in Canada, according to IQVIA Pharmafocus 2027, a global forecast on pharmaceutical trends used by Health Canada. Expanded national pharmacare is likely to increase demand for generics.

Last year Health Canada recalled three generic drugs (Accel-Ondansetron ODT, Mint-Betahistine and PMS-Pirfenidone) due to serious data integrity issues found at India-based Synapse Labs, the site that had tested the products. The European Medicines Agency identified “irregularities in study data,” raising serious concerns about the bioequivalence of the drugs. Following the recall, the makers of Accel-Ondansetron ODT and Mint-Betahistine submitted new bioequivalence data, according to Health Canada. The regulator concluded the drugs to be safe and equivalent to the brand-name drugs and has granted approval for them to resume selling the products.

When asked if industry pressures in the generics space was a concern the department said, “Health Canada has not identified significant ongoing compliance concerns specific to generic drug manufacturers.”

Despite concerns about oversight gaps and mounting pressure on regulators around the world, Health Canada said it is actively adapting. “We’re following the context, we’re following the trends, we’re following the technologies, we’re following what’s happening in the pharmaceutical industry to make sure that we’re able to meet the demands of tomorrow,” said Godard.