In partnership with
Reimagining Healthcare Procurement
Public procurement plays a crucial role in shaping Canada’s healthcare landscape, driving innovation, and ensuring patient access to vital treatments. Recognizing the need for ongoing evolution to meet current and future challenges, the Ontario Chamber of Commerce (OCC), in partnership with Pfizer Canada, convened leaders from government and industry to examine best practices across jurisdictions, identify opportunities to streamline approvals, and advance value-based approaches—all aimed at building a more agile, secure, and patient-focused procurement ecosystem.
NAVIGATING PROCUREMENT DURING TRADE UNCERTAINTY
Canada’s Life Sciences Sector: A Critical Pillar of Canada’s Economy
Canada’s bio-pharmaceutical industry is a key driver of economic growth, contributing $18.4 billion in economic activity in 2022, a 15 per cent increase from 2021. The sector also invested $3.2 billion in R&D and supported over 110,000 full-time jobs, up nearly 8 per cent year-over-year.1
Despite this momentum, access to new treatments remains slow. On average, new drugs in Canada still face a two-year wait to be funded by public drug plans following regulatory approval and launch2, and public coverage for new medical technologies typically takes around 30 weeks post-approval.3
At the same time, global trade risks are threatening supply security. The potential for Canada to impose a 25 per cent retaliatory tariff on $3.7 billion worth of U.S. pharmaceutical imports could disrupt access to over 800 products4, underscoring how public procurement is not simply transactional; it must form part of policies that protect economic security.
Canada’s pharmaceutical and life science supply chains are deeply integrated into the broader economy, driving research, innovation, and competitiveness, while addressing the evolving needs of patients and communities. For this sector to realize its full potential, coordination and collaboration across jurisdictions, sectors and agencies must become the default, not the exception.
1 https://www150.statcan.gc.ca/n1/pub/11-621-m/11-621-m2025004-eng.pdf
2 https://innovativemedicines.ca/newsroom/all-news/innovative-medicines-canada-urges-provinces-to-accelerate-access-to-medicines/
3 https://www.fraserinstitute.org/sites/default/files/2024-12/waiting-your-turn-2024.pdf
4 https://innovativemedicines.ca/wp-content/uploads/2025/03/Tarrifs.pdf
This can help reduce delays, mitigate risks, and enhance resilience. To achieve this, the federal government must ensure adequate staffing and resourcing at key organizations, including Health Canada, the pan-Canadian Pharmaceutical Alliance (pCPA), and Public Service and Procurement Canada (PSPC), as well as the Public Health Agency of Canada (PHAC), so that integration is not only possible but also prioritized.
Safeguarding Access: A National Imperative
The COVID-19 pandemic highlighted the necessity for collaboration between government, industry, and academia to maintain patient care and access during a crisis. Whether it was deploying rapid tests or navigating Personal Protective Equipment (PPE) shortages, or securing COVID-19 vaccines for our population, informal, proactive and trust-based collaboration enabled the system to respond to urgent needs. This reinforces the value of institutionalizing these models beyond times of crisis.
Healthcare must be recognized as a national asset, not simply a line item on provincial ledgers. Consensus and collaboration should be the norm when considering tariff countermeasures or updating procurement policies, as they strengthen access to medicines, foster innovation, and protect public health.
Learning from National and Global Models
Government and industry should focus on long-term risk-sharing rather than principally on risk mitigation. This can be achieved through shared accountability, pilot projects, and planning that extends beyond election cycles. For example, Germany’s Pharma Strategy 4.0 is a robust and broad-ranging plan to elevate the country’s research, development, manufacturing, and regulatory environment, shifting from a focus on budget control to one of strategic, innovation-led growth.
Canadian examples include Health Emergency Readiness Canada (HERC) and the provinces of Newfoundland and Labrador and Nova Scotia, where early engagement, Return On Investment (ROI)-based collaboration between government and industry, smaller-scale pilot programs, and building innovation hubs have led to faster adoption, stronger system readiness, and better alignment with commercial timelines.
By proactively planning and learning from other jurisdictions and moving toward a risksharing model where government, academia, and industry collaborate from the outset, Canada can enhance healthcare system resilience and ensure timely, cost-effective solutions that meet public needs and commercial viability. This approach also positions procurement as a strategic lever, not just an administrative task, capable of enabling long-term innovation and economic security.
Canada Must Improve at Scaling What Works
Experts have identified the “pilot-to-nowhere” problem as a persistent challenge: vendors report that provincial governments often engage too late and fail to commercialize or scale proven products, clinical trials, and treatments. This fragmented approach creates a ripple effect across Canada’s life sciences and pharmaceutical ecosystem, stalling innovation and weakening global competitiveness.
Clinical trials, which are essential to validating the safety and effectiveness of new treatments, advancing scientific discovery, securing regulatory approvals, and ultimately improving public health outcomes, illustrate this challenge. Canada’s share of global clinical trials have fallen by almost half, from 6 per cent in 2010 to 3.1 per cent in 2022,5 signalling a troubling decline in the nation’s ability to attract and retain investment in health innovation.
Canada can reverse this trend by embracing models that work, such as pilot programs in other jurisdictions where early alignment and clear stakeholder roles led to commercialization, investment attraction, and economic growth.
To lead in global health innovation, Canada must establish mechanisms for coordinated, ongoing engagement across all levels of government and the private sector. This includes creating incentives for early adoption of innovation, embedding commercialization pathways into pilot design, and ensuring funding is available beyond the pilot stage. Doing so will not only accelerate the pathway from pilot to product, but also position Canada as a destination of choice for life sciences research, development, and investment.
REIMAGINING PROCUREMENT IN ONTARIO
Procurement for Impact: Evolving from Cost to Value
Ontario is home to more than 2,000 life sciences companies that contribute $65.2 billion to its GDP and support 72,000 high-paying jobs.6 In 2020, the Government of Ontario established Supply Ontario to strengthen and centralize supply chain management and procurement across the public sector, seeking access to high-quality, timely, reliable products at the best value.
Ontario’s procurement landscape is inherently complex, requiring deep, cross-sectoral expertise and alignment across multiple ministries and agencies. As Supply Ontario evolves, it can serve as an “air traffic control” body, strategically resourced and empowered to align procurement strategy, streamline vendor engagement, and adapt to emerging needs.
However, a strong procurement framework must be matched by robust healthcare infrastructure. Ontario’s healthcare system performs strongly, with the lowest hospitalization rate, shortest acute care stays (tied with Quebec), and lowest inpatient costs in all of Canada, all while maintaining quality care and operating with fewer hospital beds per capita than most provinces and OECD countries.7
Maintaining this leadership and meeting future demand requires sustained funding in procurement processes, facilities, and technologies that deliver care on the ground. As Ontario transitions toward Value-Based Procurement (VBP), a model that prioritizes long-term outcomes versus short-term savings, targeted investments in hospital infrastructure will be critical. These investments will enable stronger procurement strategies, improve patient outcomes, and ensure equitable access to treatments best aligned with clinical needs.
5 https://innovativemedicines.ca/wp-content/uploads/2023/05/6354_IMC_ResearchNote_ClinicalTrialsCanada_2023_v3-1. pdf
6 https://www.investontario.ca/life-sciences
7 https://www.oha.com/Bulletins/OHA-Hospital%20Efficiency%20Paper_August2024_FINAL.pdf
Procurement is Innovation Policy
Procurement isn’t just a cost control tool; it’s a lever for innovation. When deployed strategically, government purchasing can shape markets, stimulate new technologies, and drive solutions aligned with public priorities.
A procurement model focused principally on minimizing upfront costs risks undermining the long-term value of investments in healthcare innovation. Embedding value requires outcome-driven procurement strategies supported by dedicated public-sector teams to support both clinical and innovation goals.
Stakeholders identify several key elements in a forward-looking procurement framework:
1. Incentives for hospitals and clinicians to adopt new, innovative, tools and digital technologies;
2. Dedicated funding for both disruptive and incremental innovation;
3. Better storytelling and promotion of successful pilot programs;
4. Clear commercialization pathways for Ontario-based R&D;
5. Early and meaningful engagement with vendors, clinicians, and patients before the Request for Proposal (RFP) stage;
6. Applying value-based criteria to products that are currently procured on pricedbased mechanisms only.
When vendors are rewarded based on value and impact, not just price, Ontario’s life sciences sector can continue to pioneer solutions that enhance access, quality of care, and patient outcomes. Ontario must lead in building a procurement model that also supports the broader pan-Canadian system, ensuring smaller provinces and territories have access to life-saving medications, clinical trials, and medical technologies.
From MEAT to Meaningful Value
Value-Based Procurement (VBP) using the Most Economically Advantageous Tender (MEAT) criteria allows for the full assessment of the value that a medicine or vaccine provides to patients, the healthcare system, and society. MEAT criteria have shown strong results because it accounts for factors such as clinical effectiveness endpoints like efficacy and safety, shelf life, ability for a product to be used in multiple indications/populations, supply history of the manufacturer, and environmental, governance and sustainability considerations.
Despite its promise, the implementation of MEAT criteria remains uneven. Stakeholders often define “value” differently, resulting in inconsistent execution. While some progress has been made toward modernized frameworks, cross-government alignment and capacity-building are still needed.
British Columbia offers a compelling Canadian example of MEAT in action. When updating its adult and pediatric pneumococcal immunization program, the province adopted a VBP approach instead of joining federal contracts that were the result of a price-based tender process. This resulted in:
1. The simplest and most efficient public program in Canada : B.C. uses one vaccine across their entire program and population, while other provinces, including Ontario, use two or three different vaccines in their program.
2. Long-term budget certainty: A five-year provincial contract provided a cost-effective option versus joining the federal contracts, which were shorter in duration.
3. Best pediatric protection in Canada8: The selected vaccine offers 24 per cent broader disease coverage than the vaccine currently used in all other pediatric programs in Canada, including in Ontario.
The message is loud and clear: Ontario can draw lessons from this model to strengthen its own VBP practices. A consistent MEAT-based approach, where applicable, grounded in long-term outcomes, can drive smarter purchasing and better health outcomes and position Ontario as a leader in value-driven innovation.
The Ontario Chamber of Commerce remains committed to fostering dialogue and collaboration among government, industry, and healthcare leaders to advance bold, forwardlooking approaches that strengthen system resilience and unlock innovation.
This document summarizes insights gathered from a consultation held by the Ontario Chamber of Commerce and Pfizer Canada in Toronto on June 10th, 2025.
8 https://www.canada.ca/en/public-health/services/publications/vaccines-immunization/national-advisory-committee-immunization-recommendations-public-health-programs-use-pneumococcal-vaccines-children-including-use-15-valent-20-valent-conjugate-vaccines.html