Medicago to cease operations in Quebec, scuttling COVID-19 vaccine production plans | Globalnews.ca

Medicago will be shutting down its COVID-19 vaccine project in Quebec after its sole shareholder decided to no longer invest in the company, the company announced Thursday.

With the Japan-based Mitsubishi Chemical Group deciding to “proceed with an orderly wind-up of its business operations in Canada and the United States,” Medicago announced the group would be ceasing all operations at the company.

“Medicago wishes to thank all its employees for their commitment, their passion, and their dedication,” the company said in a statement.

“The Medicago team has pushed scientific boundaries and we know that they will continue to make incredible contributions to innovation and biopharmaceutical’s sector.”

A spokesperson confirmed to Global News the shutdown will affect 586 jobs in Quebec.

Medicago’s Covifenz shot was the first Canadian-developed COVID-19 vaccine to be approved for use by Health Canada in February of last year. The vaccine also marked the world’s first ever plant-based jab authorized for human use and was also the first Canadian vaccine of any kind to be approved in over 20 years.

The month after its approval from Health Canada, the Covifenz vaccine was rejected by the World Health Organization because of Medicago’s ties to tobacco giant Philip Morris, which owned a one-third stake in the company. Philip Morris cut ties with Medicago in December.

According to The Mitsubishi Chemical Group, after the Medicago vaccine was licensed in Canada, the company began preparing for a transition to “commercial production.”

Now, it’s reason for terminating its operations with Medicago have to do with the current global demand of the COVID-19 vaccine, along with “economic context for the COVID-19 vaccine and the challenges Medicago faces in its transition to commercial production.”

“The Group considered it unviable to continue investing in the commercialization of Medicago’s development products and therefore chose to terminate all its activities with Medicago and proceed with an orderly dissolution of its business and activities,” The Mitsubishi Chemical Group said in a statement.

The group is also currently reviewing the impact the decision will have, it said.

Mitsubishi Chemical Group communications director Osamu Shimizu said in an email to Global News that development of the Covifenz vaccine will be discontinued entirely.

In addition, construction on a new, 90,000-square-metre facility and headquarters in Quebec City will be stopped, and “appropriate arrangements” including the property’s sale “will be considered in the winding down process,” he said.

In 2020, Medicago received $173M from the federal government for facility construction and research and development of the vaccine.

Laurie Bouchard, spokesperson for Minister of Innovation, Science and Industry François-Philippe Champagne said the government is “disappointed” to learn of Mitsubishi’s decision.

“Recognizing the impacts this decision will have on their employees, we continue to be in discussion with the Government of Quebec to assess next steps,” said Bouchard.

“Medicago’s contribution to Canada’s biomanufacturing and life sciences ecosystem is important because of their innovative plant-based vaccine technology.”

Additionally, Bouchard said the government expects collaboration from all involved parties to ensure Canadian interests are protected accordingly to their legal and contractual obligations with the Government of Canada.

“Protecting the health and safety of Canadians is our government’s top priority, including ensuring we have sufficient domestic vaccine production capacity to protect against future infectious disease threats and pandemics,” she said.

Canada’s Minister of Health and MP for Quebec, Jean-Yves Duclos, is also disappointed by the decision, according to a statement to Global News Thursday.

“Our first thought is for the workers in the region and their families,” the statement said.

“My Canadian government colleagues and I will work with the Government of Quebec and economic leaders in the region, particularly those in the life sciences, to protect Canada’s interests and those of the workers and to identify options for the future.”

Additionally, Duclos and his constituency team will also be at service of Medicago workers “for any type of assistance they may wish to seek from the Canadian government.”

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