TORONTO — The federal government wants to explore options for Canada's next pandemic flu vaccine contract, telling industry it will consider whether it is feasible and worthwhile to have a back-up deal with a company other than its main supplier.

But the way the notice to industry is worded, it appears GlaxoSmithKline has a virtual lock on the main contract, unless another manufacturer decides to build a new flu vaccine facility in Canada.

The notice said the government's future strategy will be based on three elements, the first of which is awarding a long-term contract for 100 per cent of the country's pandemic vaccine needs to a domestically located manufacturer.

Under the current circumstances, that's code for GSK, people who have been involved in this file for a long time say.

"Unless somebody else is willing to invest a huge amount of money in building a competitive infrastructure over three years, yeah," said Dr. Perry Kendall, chief medical officer of health for British Columbia.

GSK's plant at Ste-Foy, Que., is the only flu vaccine production facility in Canada. The company holds Canada's current pandemic flu vaccine contract, which expires March 31, 2011.

The current contract assures GSK a 75 per cent share of Canada's seasonal flu vaccine purchase. The federal government bulk buys for all the provinces and territories.

The remaining 25 per cent of the seasonal vaccine purchase is allotted to Sanofi Pasteur, the largest player globally in flu vaccine production but a company that does not make the vaccine within Canada's borders.

Having a domestic supplier of vaccine has been a key component of Canada's pandemic planning since the U.S. refused to allow the export of vaccine destined for Canada during the 1976 swine flu scare.

As pandemic planning picked up steam over the last decade with concern over H5N1 bird flu, planners anticipated that a bad pandemic would prompt producing countries to close their borders to exports of flu vaccine and flu drugs until their own needs had been met.

"And that could still happen," Kendall said, who noted that it occurred even with the mild swine flu pandemic.

At the height of the global demand for H1N1 vaccine last fall, Australian manufacturer CSL Ltd. had to delay filling an order for the United States because Australia wanted to start vaccinating its citizenry immediately.

"So if you want to avoid that happening, you need a domestic capacity," Kendall said. "We have a domestic capacity."

GSK's production last fall seemed initially to be slower than some other manufacturers, though in the end Canada got more vaccine sooner than probably any other country and it immunized more of its population than any other nation that attempted vaccination against H1N1.

During the uneasy wait for vaccine, when it was unclear how bad the pandemic would be, the government was hammered in Parliament and in the editorial pages for not having contracts with multiple suppliers.

But the U.S. had five suppliers, and that didn't assure Americans speedy access to sufficient quantities of vaccine, many observers have since noted.

"Just having two or more suppliers does not guarantee you that you'll get vaccine," Kendall said, adding that back-up contracts will come at a cost.

"You presumably would have to be prepared to spend more money or else get very flexible contracts with that other company. And that in itself doesn't guarantee you access."

The notice to manufacturers said Canada will consider awarding a back-up contract, "if feasible and of demonstrated value to Canada." If such a contract is awarded, it might also give the holder a share in Canada's seasonal flu vaccine purchase.

The notice said additional suppliers of seasonal influenza vaccine might be added to the mix as well.

Before Canada signed the world's first pandemic flu vaccine contract in 2001, Sanofi and Shire Biologics — which owned the Ste-Foy plant at the time — shared the seasonal flu contract on a 50-50 basis. They were the only two companies licensed to sell flu vaccine in Canada at the time.

Since then Solvay has brought its flu vaccine to market in Canada and AstraZeneca has filed for a licence to sell in Canada a nasal spray flu vaccine made by its subsidiary, MedImmune.