It did not. The Canon is an integral part of Mahayana, has always been.
In Chinese Mahayana, the Canon is included in the form of Agamas (translated to Chinese). In Tibetan Mahayana, the Canon is a part of Kangyur (translated from Chinese or Sanskrit to Tibetan). Most of those are the same sutras as in Pali, just with slightly different wording. Some are rather different, and shed new light on the teaching. Some are even more "explicit" (clear, straightforward):
"It was a dark night, raining lightly, with flashes of lightning. The Buddha said to Ananda: "You can come out with the umbrella over the lamp." Ananda listened, and walked behind the Buddha, with an umbrella over the lamp. When they reached a place, the Buddha smiled. Ananda said: "The Buddha doesn’t smile without a reason. What brings the smile today?" The Buddha said: "That’s right! That’s right! The Buddha doesn’t smile without a reason. Now you are following me with an umbrella over a lamp. I look around, and see everyone doing the same thing."
"At that time, Mahakasyapa stayed for a long time in a deserted meditation place, he came to visit Buddha, with long hair and beard, wearing old torn clothes. At that time, the Buddha was explaining dharma, surrounded by many people. The monks saw Mahakasyapa coming from afar, and were contemptuous of his appearance: "What kind of monk is this? Dressed in such ragged clothes, looking so uncouth." The Buddha knew what was on their minds, and he said to Mahakasyapa: "Welcome! Come share my seat. Now I am going to find out who became a monk first, you or me?" Those monks were shocked, their body hair stood up, wondering among themselves. "How strange! This respectable monk
was offered to share Buddha’s seat."
Then, Mahakasyapa put his palms together: "Most respectable one, the Buddha is my master. I am the disciple."
The Buddha said: "True, true. I am the master. You are the disciple. Why don’t you sit down and make yourself comfortable?"
Mahakasyapa touched his head to the Buddha’s feet and sat aside…"
"Listen carefully and think. I will explain it to you. When the eye meets the matter, and you become aware that the matter is desirable, then practice detachment. If, on the other hand, the matter is undesirable, then practice non-avoidance… In this way, you will know that your desire arises from your eye meeting the matter, and this realization will make it cease…like a drop of water on an extremely hot iron ball, it will evaporate in an instant…"
These were extracts from Samyukta Agama. According to the sutra commentaries in the Yogacara-bhumi Shastra, the Samyukta Agama was the earliest agama collection. See my answer here for links to the full sutras.
Now, you have to understand that Mahayana sees itself as a living tradition, concerned first and foremost with the spirit of Dharma, not its letter. So from Mahayana's perspective to understand the point, the taste, and the style of teaching is much more important than to memorize the matrika-s. So in Mahayana making up new texts to convey the point in a new way suitable to the new generation of students in the new country is totally acceptable and even desirable. The Chinese and Tibetan people are very different in character from Indian - and so the outer wrapping on the medicine of Dharma had to be adapted to make it more attractive to them. The medicine itself is the same, just a different wrapping.
I suspect that modern Western people (Americans and Europeans) are more like ancient Indians than like ancient Tibetans or Chinese. So naturally the agama-sutra-style teaching is more appealing to us than the long-mahayana-sutra-style or the tantra-style. But whatever style teaching we take, it is critically important to understand that the point of Dharma applies to our immediate living experience, not to some far-fetched fantasy.
As one translation of Heart Sutra says:
Far beyond mistaken fantasy, at last there is Nirvana.