🧪 rapid testing

quick monopolies

I fear that I may have inadvertently contributed to misinformation online. It seems like my tweet led people to infer that Loblaw-owned pharmacies were re-selling rapid COVID-19 tests that the province of Ontario had. That is not the case.

Of course companies can procure from distributors (thank you men in my MENtions).

The internet’s annoyance at Shopper’s Drug Mart’s apparent exclusivity in selling rapid COVID-19 tests is the product of concurrent issues: Health Canada’s seemingly slow approval of the rapid-tests, the uneven deployment of rapid-tests in workplaces, and their commercialization. So the Shopper’s announcement didn’t bring much relief. Rather, it felt annoying - like some kind of reward to one firm.

*I’ll save you the scroll and offer my quick take right here:

  1. People are reacting to a competition issue;

  2. $40 isn’t a bad price when you look at other benchmarks (mostly from the US).

Experts have raised concerns about accessibility, equity and price, as well as the false confidence that these tests can inspire - especially ahead of a long weekend in the spring.

🏛️ regs

Quick look at how these products go from a lab to the shelf. They are medical devices, so they need approval from Health Canada. You can look at Health Canada’s list of testing devices for COVID 19: applications under evaluation (there are ~100).

And then if you want to know what is approved, there is a list of Authorized Medical devices for uses related to COVID-19.

So - the “devices” are approved, and it is a matter of them being purchased and distributed, or procured by private firms for their workplaces.

The province expanded COVID-19 rapid screening earlier this month.

The COVID-19 Rapid Screening Initiative will provide free rapid antigen tests for employees of small and medium-sized businesses through participating local chambers of commerce and other organizations. The program will screen for asymptomatic cases of COVID-19 in the workplace that might otherwise be missed, helping to keep workers and their families safe and businesses open.

👀 Loblaw’s Competition Bureau Investigation

Let’s not forget, in 2017 the Bureau dropped its investigation into Loblaw for potentially abusing its dominant position when it came to how it purchased products from wholesalers. The three year investigation focused on Loblaw’s policies that “sought compensation from its suppliers when its profitability was negatively impacted by the competitive activity of other retailers”. Specifically, Loblaw required wholesalers to provide it financial compensation when (according to the Bureau’s website):

  1. another retailer's price for one of the supplier's products was lower than or equivalent to Loblaw's price;

  2. it determined that another retailer's wholesale cost for a product was lower than its wholesale cost;

  3. it was not offered a product or format that was offered to another retailer; or

  4. its margin or profitability on one or more of a supplier's products fell below a specified threshold.

These requirements were thought to have suppressed competition among grocery retailers. Despite wholesalers telling the Bureau that these policies caused them to engage in deals that undermined competition, the Bureau still shuttered the case citing “insufficient evidence to conclude that the Loblaw Policies have lessened or prevented competition substantially in any relevant market.

The finding speaks to the incredibly high, if not impossible, legal standards the Bureau needs to meet in order to bring a successful case under Canada’s laws.


💰 riches

The current $40 price point seems quite good when compared to other benchmarks: in the US, average cost of a rapid antigen test is $189 ($228) and on Canadian health platform Maple, an independent COVID-19 test costs $159, inclusive of HST. 

We’ve been slow to bring rapids to the market. Perhaps that’s partially related to Canada’s “Theranos” moment with Spartan Bioscience, which has since filed for creditor protection about a year after landing $74M from the government to produce rapid-19 testing kits .

All that said, purchasing one of these tests may still prompt another test to verify the result.

So who are the tests even FOR? There are all kinds of contexts where someone may be asymptomatic and want to confirm that they do not have COVID, especially as we look ahead to a partial re-opening of the province. It’s an investment in peace of mind. Again, if you have symptoms or have had contact with a confirmed case, you are eligible for a test in Ontario.

Perhaps people with workers coming into their home want to have tests on hand, or people that employ nannies. There are many people - like pharmacists - working indoors and while they have PPE they may want another check.

So again, the issue not really a public health debate (though some have advocated that these should be freely available) but one of competition. There is currently one product at one place. And people were right to be pissed, and I hope the frustration proves productive.

I’m looking forward to seeing what a healthier market for rapid COVID-19 tests looks like in Canada.

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Vass Bednar is the Executive Director of McMaster University’s new Master of Public Policy in Digital Society Program.