On May 12, 2023, Health Canada alerted industry of a proposal to introduce cost recovery fees for Natural Health Products (NHPs). This proposal, initially released for consultation from May 12 to August 10, 2023, aimed to introduce new fees for manufacturers, packagers, labelers, and importers of NHPs in Canada. During this consultation period, Health Canada received 4,696 submissions and 116 emails from stakeholders providing their feedback on the proposed fees.
In response to the feedback received, Health Canada has revised its proposal and opened a new consultation period from March 27 to May 25, 2024.
Health Canada is the agency responsible for helping people (in Canada) maintain and improve their health. To do so, the agency executes regulated activities for product categories, including NHPs, by way of published Acts and Regulations such as the Natural Health Product Regulations (NHPR). Launching a product in Canada under the NHPR carries a cost associated with regulatory activities such as the time it takes to evaluate a new product application.
The purpose of these revised fees is to cover the costs associated with the regulation and oversight of NHPs by Health Canada. The new proposal aims to strike a balance between ensuring the safety and quality of NHPs and minimizing the financial burden on businesses involved in the NHP industry.
These proposed fees will apply to all manufacturers, packagers, labelers, and importers of NHPs in Canada. NHPs encompass a wide range of products, including:
The revised proposal by Health Canada still includes cost recovery fees; however, these fees have been reduced compared to the initial proposal. Health Canada is also phasing in the fees over seven years, as opposed to all at once. Below is a table outlining the new fee structure:
Fee line |
Fee category |
Fees as per initial proposal (published May 12, 2023) |
Fee-setting ratios temporarily lowered: |
Fee-setting ratios raised to levels from the initial proposal: |
|||||
|---|---|---|---|---|---|---|---|---|---|
Year 1 December 1, 2025 to March 31, 2027 |
Year 2 April 1 2027 to March 31 2028 |
Year 3 |
Year 4 |
Year 5 |
Year 6 |
Year 7 |
|||
| Pre-market evaluation (EVAL) | Class I application or amendment | $1,124 | $128 | $157 | $177 | $196 | $236 | $265 | $294 |
| Class II application or amendment | $2,761 | $513 | $631 | $710 | $788 | $946 | $1,064 | $1,182 | |
| Class III application or amendment | $7,209 | $1,799 | $2,214 | $2,491 | $2,768 | $3,321 | $3,736 | $4,151 | |
| Site licensing (SL) | SL applications or amendments | $4,784 | $1,147 | $1,412 | $1,588 | $1,765 | $1,882 | $2,117 | $2,353 |
| Annual SL: manufacturing (sterile and non-sterile dosage form) | $40,071 (sterile) $23,071 (non-sterile) |
$4,661 | $5,737 | $6,454 | $7,171 | $7,649 | $8,605 | $9,561 | |
| Annual SL: importation | $20,035 | $3,995 | $4,917 | $5,531 | $6,146 | $6,555 | $7,375 | $8,194 | |
| Annual SL: packaging and labelling | $7,650 (packaging) $6,921 (labelling) |
$1,448 | $1,782 | $2,005 | $2,227 | $2,376 | $2,673 | $2,970 | |
| Right to sell (RTS) | NHP RTS | $542 | $154 | $189 | $213 | $237 | $254 | $285 | $317 |
Additionally, there will be reduced fee structures specifically tailored for small businesses. A small business is defined as a company with fewer than 100 employees or between $30,000 and $5 million CAD in annual revenue. Here is a table outlining the reduced fees for small businesses::
Fee line |
Fee category |
Fees as per initial proposal (published May 12, 2023) |
Fee-setting ratios temporarily lowered: |
Fee-setting ratios raised to levels from the initial proposal: |
|||||
|---|---|---|---|---|---|---|---|---|---|
Year 1 December 1, 2025 to March 31, 2027 |
Year 2 April 1 2027 to March 31 2028 |
Year 3 |
Year 4 |
Year 5 |
Year 6 |
Year 7 |
|||
| Pre-market evaluation (EVAL) | Class I application or amendment | $562 | $64 | $79 | $89 | $98 | $118 | $133 | $147 |
| Class II application or amendment | $1,381 | $257 | $316 | $355 | $394 | $473 | $532 | $591 | |
| Class III application or amendment | $3,605 | $900 | $1,107 | $1,246 | $1,384 | $1,661 | $1,868 | $2,076 | |
| Site licensing (SL) | SL applications or amendments | $3,588 | $860 | $1,059 | $1,191 | $1,324 | $1,412 | $1,588 | $1,765 |
| Annual SL: manufacturing (sterile and non-sterile dosage form) | $30,053 (sterile) $17,303 (non-sterile) |
$3,496 | $4,303 | $4,841 | $5,378 | $5,737 | $6,454 | $7,171 | |
| Annual SL: importation | $15,026 | $2,996 | $3,688 | $4,148 | $4,610 | $4,916 | $5,531 | $6,146 | |
| Annual SL: packaging and labelling | $5,738 (packaging) $5,191 (labelling) |
$1,086 | $1,337 | $1,504 | $1,670 | $1,782 | $2,005 | $2,228 | |
| Right to sell (RTS) | NHP RTS | $407 | $116 | $142 | $160 | $178 | $191 | $214 | $238 |
While these costs are reduced in the revised proposal, they still represent a significant financial commitment for businesses in the NHP industry.
Should Health Canada move forward with the revised proposal, it will impose a substantial monetary burden on all businesses involved with NHPs, especially entrepreneurs. Despite the mitigations proposed to lessen the impact on small businesses, these fees could still pose challenges for companies operating in the NHP sector. Health Canada aims to implement these fees by December 1, 2025. If you are planning to launch new Natural Health Products in Canada, we recommend filing your product and/or site licence applications sooner rather than later to avoid the potential pending fees.
The revised proposal is open for consultation until May 25, 2024. Anyone with a vested interest in NHPs should submit their comments regarding the revisions to the proposed fees via the online comment form available on Health Canada’s website. Your feedback is crucial in shaping the final fee structure and ensuring that it strikes a fair balance between regulatory oversight and industry sustainability.
Contact dicentra today to learn more about these new fees and how they could impact your business.