Good morning. U.S. President Donald Trump’s trade agenda is leading to layoffs and uncertainty in Canada’s manufacturing industry. Below, we look at how that same geopolitical tension is straining the country’s access to pharmaceuticals.
Today’s news:
Mining: Barrick Mining Corp. is appealing again to Mali to resume talks to end a bitter dispute that threatens to wrest away control of its massive gold mining operations in the country.
Energy: Oil sands chief executives say they want to work with the new federal government to advance a massive carbon capture project in Northern Alberta, but they are in a holding pattern until funding is figured out.
Credit: A number of red lights are flashing on the dashboard of Canada’s consumer finances, according to data released this morning by Equifax.
What we‘re following
- Bank of Nova Scotia reported lower second-quarter profit that missed analysts’ estimates as the lender set aside more provisions for loan defaults. National Bank of Canada and Bank of Montreal are up tomorrow.
- After yesterday’s reported drop in manufacturing sales, today’s wholesale data will help paint a fuller economic picture. Ahead of Canada’s quarterly gross domestic product report on Friday, the OECD urged the country boost productivity and housing affordability.
Clonazepam: A long journey to Canada.Joe O'Connal/The Canadian Press
In focus
Tough medicine: How tariffs hit Canada where it hurts
Consider one tablet of generic clonazepam – prescribed across Canada for anxiety and seizures. From its origins as an active ingredient in India to a pharmacy shelf in, say, British Columbia, it will have travelled more than 63,000 kilometres. In between are regulatory detours, redundant shipping loops, and a supply chain stitched together by low costs and high risk.
A new study by researchers at McMaster University is opening a rare window onto an oft-unexplored part of the pharmaceutical system. The team focused on clonazepam because its supply chain could be readily pieced together – a rarity for a generic drug.
Each step of its journey reveals the fragile nature of Canada’s pharmaceutical supply chain, Chris Hannay reports. The country’s dependence on frictionless trade, stable geopolitics and uninterrupted global shipping is being exposed by Trump’s push for tariffs and industrial protectionism. And the cracks that emerged during shortages at the worst of the COVID-19 pandemic are widening under renewed trade pressure.
The symptoms
- Canada imports roughly 70 to 80 per cent of its active pharmaceutical ingredients, most of them from India and China.
- Even for routine medications, the system has little redundancy – and few domestic options if foreign supply falters.
- Between 2020 and 2022, Canadians saw the consequences firsthand, as supply of antibiotics, children’s fever medications and common sedatives were snarled in bottlenecks in transport, production and packaging.
The prescription
The authors argue that addressing this fragility will require more than panic stockpiling. Their recommendations include:
- Shortening supply chains.
- Improving transparency around pharmaceutical emissions.
- Adopting climate-based procurement rules, such as those used by Britain’s National Health Service.
- Investing in domestic capacity to reduce reliance on imports.
Canada could implement similar standards, or invest in domestic capacity to reduce reliance on complex import routes, they write.
And while the researchers couldn’t calculate exact carbon dioxide emissions from a clonazepam pill’s pathway, they did outline its clear environmental costs, noting emissions and waste affect local ecosystems and contaminate drinking water.
“This disproportionally harms vulnerable communities, notably Indigenous, Black and low-income populations,” they wrote.
On the clinical side, they point to “de-prescribing initiatives” as one of the simplest ways to reduce dependency on fragile global pipelines – and on medications Canada might not need in the first place.
For as long as Canada’s pharmaceutical supply system relies on predictable trade flows, co-operative regulation and low-cost offshore manufacturing, the researchers argue, it will remain exposed to disruption.
Charted
Uranium? Urani-us
The U.S. uranium industry is on life support after a long illness. But Trump’s push for “energy dominance” is fuelling trade uncertainty with potential consequences for Canadian miners. Canadian uranium giant Cameco is downplaying the risk, Matt McLearn writes, but investors are watching closely.
Bookmarked
In debt: Telecom giants take action to address a worrisome trend in their ledgers.
In sickness and in health: Tariffs are rippling through Canada’s wedding industry, driving up prices and pressuring couples to make faster purchasing decisions.
In hindsight: CEOs of Canadian banks were optimistic during Trump’s first term. How times have changed, Rita Trichur writes.
Morning update
Global stocks advanced after U.S. President Donald Trump rolled back his threat of steep tariffs against the EU. Wall Street futures were up sharply following the U.S. holiday Monday, while TSX futures followed sentiment higher after yesterday’s record close.
Overseas, the pan-European STOXX 600 was up 0.48 per cent in morning trading. Britain’s FTSE 100 rose 0.8 per cent, Germany’s DAX gained 0.75 per cent and France‘s CAC 40 climbed 0.2 per cent.
In Asia, Japan’s Nikkei closed up 0.51 per cent higher, while Hong Kong’s Hang Seng gained 0.43 per cent.
The Canadian dollar traded at 72.66 U.S. cents.