A company is suing the federal government for $21 million for forgoing the purchase of 10 million COVID-19 tests that were to be manufactured in Montreal. These tests were invented by researchers at McGill University.
Posted at 5:56 p.m.
Cryopak Industries and Launchwork CDMO, subsidiaries of the Canadian-American company Integreon Global, claim to have invested nearly eight million at the end of 2020 to set up this production line at their Anjou plant. This includes several hundred thousand dollars to buy raw materials from McGill University, which had pilot production of 15,000 tests in the fall of 2020.
The lawsuit, which includes $13 million in lost profits and lost business opportunity, says Cryokak, Launchwork and Canadienzyme, the company started by McGill inventors Martin Schmeing and Don Van Heyel, responded in the end. from the summer of 2020 to a federal government tender for an all-Canadian production line for these tests, for a $2.10 per test, or $21 million.
The price seems normal to Mr. Schmeing, who was not involved in the negotiations with the government. “What I find unfortunate is that this Canadian test could not be used in Canada,” he said in an interview. The technology could, however, be used for testing for other microbes and diseases.
Launchwork is a contract manufacturing company for drugs and other medical products, and Cryopak specializes in temperature-controlled packaging. The tests were due to be delivered in March 2021.
In November 2020, the Ministry of Public Services indicated that the profit margin on testing (29.8%) was too high. After further discussions, the contract was canceled in January. Cryopak and Launchwork say the federal government should have indicated earlier in the negotiations that the price of $2.10 per test was too high.
The Departments of Justice, Health, Public Services and Industry did not respond to a request for comment on the lawsuit.