Hear from prominent industry experts on the state of play and what's next for the sector in our feature Q&As from Bettina Hamelin of Ontario Genomics and Hamid Noori of The Cultivated B.
Agriculture has historically been among Canada's most important economic drivers. However, it is marked by unique challenges including changing environmental conditions, rising costs, an increase in competition amongst foreign markets, and an aging farming population. The commercialization of innovative technologies seeks to lessen these challenges—bringing advanced productivity, reduced waste, higher yields, and solutions for macro issues like food security and climate change issues.
Last year, alternative proteins and ag-biotech, including cellular agriculture and gene-edited plants, led the way in agtech in Canada, with overall investment in the space gaining momentum after a slower 2022—showing a renewed interest from the market1. We look at these trends and some of the legal and regulatory developments shaping these emerging areas.
Advancing alternative proteins
With exploding interest in alternative proteins, plant-based foods are seeing rapid development—and both investors and industry are taking note. In Canada, the federal government has set a target to supply 10% of the world's plant-based foods by 20352. This goal, amongst other initiatives, has opened the door to innovators who seek to diversify the food supply chain. However, companies developing and commercializing these products must have regard to evolving regulation.
Canada's Food and Drug Regulations (FDR) provide strict labeling, composition, and fortification requirements for "simulated" meat and poultry products (defined as products that do not contain meat, poultry, or fish but that have the "appearance" of a meat or poultry product)3. The Canadian Food Inspection Agency's (CFIA) new guidance for "simulated" meat and poultry products4 published in Q4 2023 provides direction for determining whether a plant-based food product is a "simulated" meat or poultry product (and therefore subject to heightened regulatory requirements for simulated meat and poultry products), or whether it is unstandardized food (thus subject to the general regulatory requirements for unstandardized foods). For example, a plant-based food that has the appearance of a beef burger (with simulated bleeding or marbling) would be classified as a "simulated" meat product, whereas a tofu patty that does not resemble a meat or poultry product and is not advertised or represented as being comparable to a meat or poultry product would not. Plant-based food producers should understand how their products will be classified and assess what, if any, labeling changes are needed to avoid unintentionally triggering "simulated" meat and poultry regulations5.
Growing interest in alternative proteins is also driving research and investment in cellular agriculture, including cultivated meat (the growth of animal cells in a controlled environment to produce food) and precision fermentation (whereby microorganisms are programmed to produce specific proteins)6. Currently, there is no specific legislation directed at cultivated meat in Canada; however, Health Canada's new guidance on cellular agriculture7 suggests that most cellular agriculture products will be regulated as a "novel food" under the FDR, and therefore subject to pre-market notification and assessment by Health Canada. Novel food products may also be subject to pre-market safety assessments by the CFIA and regulation by other agencies, such as Environment and Climate Change Canada. To date, no cultivated meat products have received approval as a novel food under the FDR, although some may be in the approval process. Like other foods, novel food products must comply with general regulatory requirements such as Canada's labeling and food safety requirements under the Food and Drugs Act and the Safe Food for Canadians Act, as well as other requirements set out in standards of identity.
Unlike cultivated meats, some products of precision fermentation have already received novel food approval in Canada, such as the nutritional fungi protein from Fusarium sp. strain flavolapis (e.g., Fy ProteinTM), for use as a food ingredient and alternative protein source. Health Canada has also recently issued novel food approval for β-lactoglobulin protein produced from a novel yeast strain (e.g., RemilkTM) where the protein is the same as β-lactoglobulin protein in whey protein from cow's milk. These examples suggest that Canadian regulators are generally signaling an innovation-friendly mindset towards emerging food production technologies for alternative proteins.
Ag-biotech
The utilization of biotechnology in the creation and modification of crops and other agricultural products has potential to create a food supply that is more diverse, of higher quality, and disease and climate resistant. Molecular breeding and genetic engineering are a common part of Canada's agricultural industry, with many farmers embracing genomics technologies to reduce water consumption, decrease food waste, and limit the use of chemicals and pesticides. This is carried out by modifying crops so that they need less irrigation, creating novel agriculture and food products with a longer lifespan, and using microbes to create biological fertilizers.
On a national level, ag-biotech plays a central role in Canada's agriculture strategy. In 2023, the government updated guidelines around gene-edited seeds—allowing for the introduction of more plant breeding innovations8. In step with this, Health Canada has signaled a favorable regulatory environment for foods derived from gene-edited plants in the guidance on novel foods, by identifying five categories of foods derived from plants that do not meet the definition of a "novel food" under the FDR9. While the guidance is limited to foods derived from plants, Health Canada has signaled an intent to develop similar guidance for novel foods derived from genetically modified animals and microorganisms10. This lighter regulatory approach we are seeing to foods derived from gene-edited plants is one example of the wider push to promote ag-biotech innovation in the country.
What's next?
In 2023, the government of Canada launched the $3.5-billion, 5-year Sustainable Canadian Agricultural Partnership (Sustainable CAP) between the federal, provincial, and territorial governments11. This, combined with a host of other initiatives by governments and industry, shows that the ag-biotech economy in Canada is cultivating fertile ground for growth and further investment.
Footnotes
1. According to PitchBook's Emerging Tech Research - Q3 2023 Foodtech Report.
2. Invest in Canada "Food for thought: the future of alternative protein investment is in Canada", online: https://www.investcanada.ca/news/food-thought-future-alternative-protein.
3. FDR, ss B.01.001(1), B.01.100, B.14.085 to B.14.090, B.22.029, and D.03.002, online: https://laws-lois.justice.gc.ca/PDF/C.R.C.,_c._870.pdf.
4. Canada, Canadian Food Inspection Agency, Guidelines on Simulated meat and simulated poultry products (05 October 2023), online: https://inspection.canada.ca/food-labels/labelling/industry/meat-and-poultry-products/simulated-products/eng/1631881284839/1631882112387.
5. See 2022 year in review: top 10 food and agribusiness regulatory and legal issues in Canada, online: https://www.torys.com/our-latest-thinking/publications/2023/06/2022-top-10-food-and-agribusiness-regulatory-and-legal-issues-in-canada.
6. CELLULAR AGRICULTURE: Canada's $12.5 Billion Opportunity in Food Innovation, online: https://www.candesyne.ca/cellular-agriculture.
7. Canada, Health Canada, Guidelines on Cellular agriculture (05 December 2023), online: https://www.canada.ca/en/health-canada/services/food-nutrition/cellular-agriculture.html.
8. Canada, Agriculture and Agri-Food Canada, The Government of Canada moves forward with plant breeding innovation while upholding the integrity of the organic sector, online: https://www.canada.ca/en/agriculture-agri-food/news/2023/05/the-government-of-canada-moves-forward-with-plant-breeding-innovation-while-upholding-the-integrity-of-the-organic-sector.html.
9. The guidance is attached as two appendices to Health Canada's Guidelines for the Safety Assessment of Novel Foods, online: https://www.canada.ca/en/health-canada/services/food-nutrition/legislation-guidelines/guidance-documents/guidelines-safety-assessment-novel-foods-derived-plants-microorganisms/guidelines-safety-assessment-novel-foods-2006.html. See Appendix 1: Health Canada Guidance on the Novelty Interpretation of Products of Plant Breeding and Appendix 2: Health Canada Guidance on the Pre-Market Assessment of Foods Derived from Retransformants (together, "guidance").
10. Canada, Health Canada, Notice of Intent to Propose Amendments to Division 28 of the Food and Drug Regulations (Novel Foods) (20 May 2022), online: https://www.canada.ca/en/health-canada/services/food-nutrition/public-involvement-partnerships/notice-intent-propose-amendments-division-28-food-drug-regulations-novel-foods.html. See also Gene-edited plants get lighter regulatory touch in new Health Canada guidance for foods, online: https://www.torys.com/our-latest-thinking/publications/2022/09/new-health-canada-guidance-for-foods.
11. Canada, Agriculture and Agri-Food Canada, Sustainable Canadian Agricultural Partnership, online: https://agriculture.canada.ca/en/department/initiatives/sustainable-canadian-agricultural-partnership.
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