Gagnon was defeated (179 votes) by the incumbent MP for Gaspé, Yvan Bernier of the Bloc Québécois, in the 1997 federal election in the restructured riding of Bonaventure—Gaspé—Îles-de-la-Madeleine—Pabok.

In 2004, he founded the pan-Canadian federal/provincial government relations firm The Parliamentary Group later rebranded as PARLGROUP with other former Canadian MPs Deborah Grey, Val Meredith, John Nunziata and Lorne Nystrom.

He is a member of The Rideau Club and served on the board of the Canadian Association of Former Parliamentarians and the Institute for Public Affairs of Montreal.

Gagnon is the managing partner of PARLGROUP [1], a federal-provincial government relations firm composed of former Members of Parliament and high-level civil servants.

The firm serves international and Canadian clients in matters pertaining to procurement, finance, pharmaceuticals, defence, engineering and the natural resources sectors amongst others.