New labelling requirements (aka Plain Language Labelling)
①
On July 6, 2022, Health Canada published new labelling requirements under the Natural Health Products Regulations (NHPR) that are set to come into practice in 2025. The intention is to ensure label information is presented in a legible and comprehensive manner – this is to reduce confusion, medical errors, product interactions and to allow consumers to locate information about safe use. All current NHP labelling requirements continue to apply, specifically what is required on the principal display panel (PDP) of a label.
Unfortunately, Government did not consider industry feedback on these changes, conduct user testing or consult labelling sciences to ensure the changes would indeed result in a clearer, more consumer-friendly label. What they did create was a very technical and inflexible guidance document that is difficult for brands to comply with.
We launched an Economic Impact Study to find out how this would impact our industry – we found:
of brands say there is a high/very high chance they will need to pull product from the market as a result of these regulations.
76%
companies say they are seriously considering leaving the Canadian market. Exciting new products and international brands will likely not come to Canada because the regulatory burden will be too severe.
1 in 5
of companies said it would have a negative impact on employment.
66%
We put the new requirements into practice to see how these changes will impact labels. Clearly, the new requirements do not present the information in a more legible and comprehensive manner as they were intended to – but actually create a more confusing label that will negatively impact profit margins, cause packaging sizes to double, and beyond current supply chain challenges, further limit product availability while hurting competition, innovation, and new product offerings.
Current Labels (click image to zoom):
Proposed Labels (click image to zoom):
New user fees for regulatory activities (aka Cost Recovery)
②
For NHPs cost recovery is proposed to include fees for regulatory activities such as product evaluation, site licenses and annual renewal fees.
With the establishment of the Natural Health Product Regulations in 2004, NHPs have not been subject to cost recovery. We understand cost recovery is a necessary part of doing business in Canada however, Health Canada, did not do a proper economic study and didn’t consider that GST is collected from the sale of NHPs.
Currently, the foundation of our regulatory system is stretched to the brink with massive backlogs in product applications. In short, data used to establish this current program is dramatically flawed and the proposed fees will financially decimate the NHP industry in Canada.
The timing of implementing this program at the same time as new labelling requirements will financially decimate many companies in our industry, making it extremely challenging for them to stay viable. These regulatory changes are unfair, unrealistic, and so costly they will force many small to medium-sized businesses to shut down Canadian operations.