Life Sciences 2021 Comparisons

Last Updated March 22, 2021

Law and Practice

Authors



Trench Rossi Watanabe (in co-operation with Baker McKenzie) has been in the forefront of Latin America’s healthcare sector for more than 60 years, and understands the challenges that clients face, bringing first-hand insight to help overcome those challenges. The firm has been instrumental in training local authorities to detect counterfeit pharmaceutical products, and helping clients enter markets effectively, grow their business and obtain successful outcomes in controversies. Trench Rossi Watanabe has the industry-specific experience and capabilities necessary to execute complex corporate transactions, product registration and licensing agreements. The firm helps clients balance sometimes conflicting regulatory regimes and their impact on clients' expansion, manufacturing and distribution strategies. In challenging jurisdictions where counterfeiting is rampant, the firm protects clients' investments through proactive detection and prosecution. The firm mobilises the right talent to co-ordinate patent and trade mark protection, transfer pricing and tax planning, employment strategies, and the efficient resolution of disputes involving product liability and unfair competition. The firm has offices in São Paulo, Rio de Janeiro, Brasília, and Porto Alegre.

The pharmaceutical and medical devices sectors in Brazil are regulated and supervised by the National Health Surveillance Agency (ANVISA), an agency linked to the Brazilian Ministry of Health, part of the Brazilian National Health System. The ANVISA holds administrative independence, financial autonomy and is responsible for the stability of its directors.

Its statutory role is the protection of the public health by executing sanitary control over the production, importation, distribution, use and commercialisation of a broad category of products such as drugs, medical devices, sanitisers, cosmetics, food, tobacco and services such as licensing conditions for health-related companies and healthcare institutions. The ANVISA is also responsible for authorising the importation and exportation of the products that are subject to health surveillance, ruling the sanitary aspects of clinical trials and defining health standards for pesticides.

State and municipal health authorities assist the ANVISA in its role.

The core rules on health surveillance in Brazil are Federal Law No 6,360/1976 and the Federal Decree No 8,077/2013.

The Brazilian legal system provides for a minimum of two levels of defence. Usually, drug and device company defendants will be able to file a rebuttal to the authority, which rendered the decision for its own review. If the decision is kept, the company may file an appeal to the hierarchically superior authority. It is important to highlight that the rules that provide for administrative procedures (such as Federal Law No 9,784/1999 and local laws) may contain specific provisions and formalities regarding the preparation of appeals and defences. Such proceedings have an administrative nature and may be subject to judicial review.

Finally, the Brazilian constitution ensures the right of access to courts for all matters. Therefore, companies may still file a judicial lawsuit to challenge the final decision issued at the administrative level.

The Brazilian regulatory framework is extremely detailed, depending on the type of regulated product. Drugs, for example, are currently regulated by the following resolutions:

  • Resolution RDC No 200/2017 – provides for synthetic drugs, including generic and similar drugs;
  • Resolution RDC No 205/2017 – provides for orphan drugs;
  • Resolution RDC No 55/2010 – provides for biological drugs and biosimilars;
  • Resolution RDC No 238/2018 – provides for dynamised drugs;
  • Resolution RDC No 26/2014 – provides for phytotherapic drugs;

The key rules on medical devices are the following (although other rules also apply):

  • Resolution RDC No 185/2001 – procedures for registration of medical devices;
  • Resolution RDC No 40/2015 – procedures for the enrolment of medical devices;
  • Resolution RDC No 36/2015 – procedures for registration of in vitro diagnosis medical devices.

These rules are updated constantly by the ANVISA.

Clinical trials are subject to approval from the Committee for Ethics in Research (CEP) and, in certain cases, from the National Committee for Ethics in Research (CONEP) and the ANVISA.

The CEP is an interdisciplinary and independent collegiate body organised by research institutions to defend the interests of research subjects and to contribute to the development of research within ethical standards.

The CONEP is an independent collegiate body under the National Health Council. Its main mission is the analysis of the ethical aspects of clinical trials through the evaluation and follow-up of protocols in thematic areas such as genetics, human reproduction, and the storage of biological material or human genetic data abroad. The CONEP is also responsible for registering CEPs, and for enforcing the duties established by the rules issued by the National Health Council.

The ANVISA is responsible for approving the clinical trials and for controlling the importation and use of investigational products.

Clinical trials must be submitted to the CEP for analysis of its ethical aspects. In some cases, the clinical trial dossier must be submitted to the CONEP, for its approval. Among the documents to be presented with the clinical trial dossier is the Informed Consent Form.

After the protocol is submitted to the CEP/CONEP, an opinion will be issued. If approval is denied, it will be possible to appeal to the CEP and/or the CONEP within 30 days.

The ANVISA’s approval must also be obtained when the research involves a pharmaceutical or medical device product.

There is a special procedure to obtain authorisation for performing clinical trials with drugs intended for rare diseases, intended to expedite regular approval procedures.

The documents needed may vary, depending on whether the investigational product is a drug or a medical device.

The National Health Council developed the electronic system “Plataforma Brasil,” which is a national and unified database of research involving human beings for the entire CEP/CONEP system.

The system allows one to monitor the clinical trials, from its submission until the final approval by the CEP and/or the CONEP (when necessary).

The system also allows the presentation of documents in digital media, providing the population with access to public data from all approved clinical trials. All research protocols involving human beings must be submitted to the CEP/CONEP system through the platform.

Legislation does not provide for any restrictions for using online tools to support clinical trials.

According to Federal Law No 13,709/2018, health data is considered as sensitive personal data. Thus, the resulting data is sensitive data.

According to Resolution No 466/2012, data obtained from research participants cannot be used for purposes other than those provided for in the research's protocol and/or in the free and informed consent executed by the patient. Thus, any transfer of data to a third party should be provided for in the research's protocol or authorised by the patient through informed consent.

Resolution No 466/2012 stipulates that data obtained from research participants cannot be used for purposes other than those provided for in the research's protocol and/or in the free and informed consent executed by the patient.

Federal Law No 5,991/1973 defines "medicine" as “any pharmaceutical product, technically built or elaborated, with prophylactic, curative, palliative or for diagnostic purposes.”

Thus, any product that has therapeutic purposes, regardless of whether they are of vegetable, animal, mineral or synthetic origin, must be considered a medicine.

However, according to Resolution RDC No 185/2001, "medical product" is defined as " as equipment, devices, materials, articles, or systems for medical, dental or laboratorial use or application, intended for prevention, diagnosis, treatment, rehabilitation, or anti-conception, and that does not use pharmacological, immunological, or metabolic means to fulfil its main function in human beings, but which can have its functions assisted by such means."

Biological products are regulated by the ANVISA's Resolution RDC No 55/2010, which stipulates that there are two types of biologic products: "new biological products" (for products not yet registered before the ANVISA) and "biological products" (for products that are not new or that contain an already known molecule of biological nature).

Additionally, the regulation establishes two different routes to register "biological products": by comparison, which, by definition, "is the scientific comparison, with respect to non-clinical and clinical parameters in terms of quality, efficacy and safety, of a biological product with a comparator biological product, in order to establish that there are no detectable differences in terms of quality, effectiveness and safety between the products," and by individual pathway, defined as "the regulatory route that may be used for obtaining the registration of a biological product in which it is necessary to present total data on development, production, quality control and non-clinical and clinical data to demonstrate quality , efficacy and safety of the product." The by-comparison route is actually the way used for the registration of biosimilars (although "biosimilar" is not an official designation).

The marketing authorisation for drugs and medical devices is valid for ten years. The renewal of both types of marketing authorisation must be requested from 12 months up to six months before the marketing authorisation's expiry date.

A marketing authorisation may be revoked for the following reasons:

  • for a product whose revalidation was not requested within the period referred to below;
  • for a product that is not classified as a drug that has not been industrialised within the validity period of the expired registration;
  • for a drug that has not been marketed for at least the time corresponding to the final two thirds of the validity period of the expired registration;
  • for failure to comply with the regulations related to the regularisation of the product;
  • request from the manufacturer;
  • request due to transfer of ownership.

All requests must be forwarded to the ANVISA with the required documents. For example, a marketing authorisation should be submitted with the product's dossier with technical information of the product (such as clinical data, clinical studies, legal documents and proposed labelling, among other information). The same applies for the change of the product's marketing authorisation.

The transfer of a marketing authorisation is allowed. According to Resolution RDC No 102/2016, the transfer procedure will be authorised upon the occurrence of: (i) a corporate transaction (merger, spin-off or amalgamation); or (ii) a commercial transaction, which is defined only as a “transaction between companies resulting in the sale of assets or a set of assets, without any corporate transaction between them” (the above-mentioned rule does not exemplify the eligible operations).

The transfer procedure is applicable for tobacco, agrochemicals, medical devices, drugs, cosmetics and foods, subject to registration or enrolment (cadastro) before the ANVISA.

The ANVISA sets out, through Resolution No 38/2013, the types of programmes related to pre-approval access to medicines, as follows: (i) Expanded Access; (ii) Compassionate Use; and (iii) post-study drug supply.

Expanded Access involves providing a new promising drug, still without the ANVISA's registration or not commercially available in Brazil, that is in ongoing or completed phase III study, aimed at a group of patients who are carriers of serious debilitating and/or life-threatening diseases and with no satisfactory therapeutic alternative with registered products.

Compassionate Use involves providing a new promising drug for the personal use of patients who are not participants of an expanded access programme or clinical trials, without the ANVISA's registration that is in the process of clinical development, aimed at patients who are carriers of serious debilitating and/or life-threatening diseases and with no satisfactory therapeutic alternative with products registered in Brazil.

Post-study supply involves the provision of drugs to patients who are the subject of the study; applicable in cases of study termination or when the participation of the patients has been completed.

According to Article 4 of Resolution No 38/2013, such programmes must be voluntarily started by the sponsor (manufacturer) or its representative through a formal application to the ANVISA (this is applicable for all the aforementioned commercial pre-registration programmes). Approval for compassionate use is granted for each patient on a personal basis and is non-transferrable. The ANVISA's approval for expanded access is granted for a group of patients.

Finally, there is no formal Named Patient Programme in Brazil; the most similar practice is the importation of the unregistered drug by the patient or by a health institution upon a specific prescription by a physician. In these cases, the costs are borne by the patient (or by the government in the case of the patient who files a lawsuit against the government and obtains the right to receive the drug from the government without cost).

There is no equivalent programme for medical devices.

According to the current applicable rules, marketing authorisation-holders are obliged to comply with either pharmacovigilance or technovigilance obligations. For drugs, it is necessary to implement a traceability system.

Other general ongoing obligations imposed on marketing authorisation-holders are:

  • to maintain its permit's validity (such as an Operating Authorisation  (AFE), an Operating Licence (LF) and a Good Manufacturing Practices (GMP) Certificate, when necessary);
  • to maintain the marketing authorisations properly updated;
  • to communicate changes to the products to the ANVISA and, if necessary, obtain appropriate previous approval;
  • to comply with the promotion of drugs and medical devices in accordance with the requirements of the relevant rules.

Third parties can have access only to information about the administrative procedure, provided for on the ANVISA's website. The ANVISA only discloses the status of the request and the department that is analysing it. Approval or denial is likewise reported in the system.

The protection of the company's commercially confidential information is provided for in Article 39.3 of the TRIPs and in Article 195, XIV, of IPL, as follows:

"Article 39.3. Members, when requiring, as a condition of approving the marketing of pharmaceutical or of agricultural chemical products which utilise new chemical entities, the submission of undisclosed test or other data, the origination of which involves a considerable effort, shall protect such data against unfair commercial use. In addition, Members shall protect such data against disclosure, except where necessary to protect the public, or unless steps are taken to ensure that the data are protected against unfair commercial use."

"Article 195 - A crime of unfair competition is committed by he who:

XIV - divulges, exploits or uses, without authorisation, the results of tests or other undisclosed data the elaboration of which involved considerable effort and which has been presented to government entities as a condition for approving the commercialisation of products.”

Federal Decree No 3,029/1999, which approves the ANVISA's regulation, provides in Article 30 that the ANVISA will treat as confidential the technical, operational, economic-financial and accounting information that it requires from the companies, provided that its disclosure is not directly necessary to prevent discrimination of consumer, producer, service-provider or to prevent the existence of circumstances of risk to the population's health.

According to Federal Law No 6,437/1997, falsified or illegal commercialisation/distribution of drugs and/or medical devices may subject the company to the following penalties:

  • warning;
  • seizure;
  • destruction and/or interdiction of products;
  • the shutting down of facilities; and/or
  • a fine (BRL2,000 up to BRL1.5 million).

From the Criminal Law perspective and according to the Brazilian Criminal Code (Article 273), it is a crime to falsify, modify, import, sell, distribute, or have in deposit for sale medicine and pharmaceutical, cosmetic, therapeutic and diagnostic use products.

The same criminal prohibition extends to products without registration at the health surveillance agency, or those in disagreement with the registration formula, or with a reduction in their therapeutic value, or of unknown origin and/or acquired from unauthorised establishments.

Penalties range from ten to 15 years of imprisonment, in addition to a fine. If the offence is committed with negligence, the penalty is imprisonment from one to three years, and a fine.       

To monitor the entry of counterfeit pharmaceuticals and medical devices in Brazil, there are customs checkpoints at ports and airports manned by the ANVISA.

In addition, baggage inspections and special operations by the health surveillance agency are carried out with the police at ports and airports, as well as other establishments where irregularities are suspected.

Inspections executed by customs control related to medicines and pharmaceutical supplies target both commercial passenger and cargo flights.

Activities related to manufacturing (of drugs and of medical devices) are subject to a health surveillance system. The permits/licences required for the regular operation can be summarised as follows:

  • an Operating Authorisation (AFE), to be issued by the ANVISA;
  • a Special Operating Authorisation (AE), to be issued by the ANVISA, in the event that the company performs activities with products subject to special control;
  • an Operating Licence (LF), to be issued by municipal or state local health authorities;
  • a Good Manufacturing Practices Certificate (GMP Certificate), if applicable, to be issued by the ANVISA.

Note that the AFE and the AE are not subject to renewal. The LF, however, is subject to renewal within a period defined in the legislation issued by the local health authority (usually one year), and the inspections in the company's premises are performed by the local health authority every time the LF is up for renewal and at any time for a periodic supervision.

A GMP Certificate is valid for two years and is required for drug manufacturers and manufacturers of medical devices framed in class III or IV.

The procedure for obtaining the licences is as follows:

  • the company should obtain approval from the Laudo Técnico de Avaliação (LTA), which is obtained after analysis of the architectural project of the premises;
  • after obtaining approval from the LTA, the company will be able to apply for the LF;
  • the company will undergo an inspection and the authority will issue its report;
  • with the favourable report of the local health authority, the company may apply for the AFE;
  • the ANVISA will analyse the report and if it determines that the company's premises are in compliance with the legislation, the AFE will be published in the Official Gazette;
  • with the publication of the AFE, the company may request the issuance of the LF;
  • the company may thereafter apply for the registration of the products and for a GMP Certificate. The approval of the certificate will be published in the Official Gazette.

Establishments engaged in the wholesale of pharmaceutical and medical devices are subject to a health surveillance system. The permits/licences required for the regular operation can be summarised as follows:

  • the AFE is to be issued by the ANVISA;
  • the AE is to be issued by the ANVISA, in the event that the company performs activities with products subject to special control;
  • the LF is to be issued by municipal or state local health authorities.

Note that the AFE and AE are not subject to renewal. The LF, however, is subject to renewal within a period defined in the legislation issued by the local health authority (usually one year), and the inspections in the company's premises are performed by the local health authority every time the LF is up for renewal and at any time for a periodic supervision.

The classifications that apply to pharmaceuticals in Brazil are the following.

  • Over the counter (OTC); and
  • drugs subject to medical prescription:
    1. red stripe – drugs subject to a prescription;
    2. red stripe – controlled drugs subject to a prescription that requires the retention of the medical prescription; and
    3. black stripe – controlled drugs subject to a prescription that requires the retention of the medical prescription.

The difference in the classification is related to the drugs' risk level, according to the relevant rules.

Resolution RDC No 81/2008 issued by the ANVISA is the main rule governing the import and export of pharmaceutical and medical devices. Note that specific rules may apply, depending on the category of the product (ie, biologics).

The ANVISA is the entity responsible for applying and enforcing such rules, being also physically present at Brazilian ports, airports and borders.

The import and export of these devices is also subject to the Federal Revenue’s regulation.

In general, marketing authorisation-holders of pharmaceuticals and medical devices and their authorised companies can act as the importer of record of pharmaceuticals and medical devices. Note that marketing authorisation holders may authorise duly licensed third parties to import regulated products directly.

The product to be imported must be also registered (or enrolled, whenever applicable) before the ANVISA.

Exceptions apply in the case of investigational products.

Companies that import pharmaceuticals and medical devices must obtain the AFE or the AE for importation issued by the ANVISA and obtain prior approval of the ANVISA via registration of the import request in the import/export system of the Federal Revenue - Siscomex (Importation Licence). The product to be imported must also be duly registered or enrolled before the ANVISA.

Marketing authorisation-holders may authorise duly licensed third parties to import regulated products directly.

Exceptions may apply in specific cases, such as in cases of importation of pharmaceutical or medical devices by individuals for their own use. In this case, the prior approval of the ANVISA and the need of AFE/AE are not required. The procedures are also somewhat different in the case of products imported in the context of clinical trials.

As a rule, non-tariff regulations and restrictions are imposed based on the tariff classification under the Common Nomenclature of Mercosur (NCM). The list of products subject to control are usually provided by the legislation issued by the relevant regulatory agencies. For ease of reference, the Federal Government regularly publishes in its Foreign Trade website a list of the NCM's codes that are subject to import licences (http://www.siscomex.gov.br/informacoes/importacao/tratamento-administrativo-na-importacao/).

Besides Mercosur, Brazil has Free Trade and Complementary Economic Agreements with Bolivia, Chile, Colombia, Cuba, Egypt, Ecuador, India, Israel, Mexico, Panama, Peru and Venezuela. The trade facilitations depend on the Agreement and on the type of products.

The prices of drugs are regulated in Brazil by the Drugs Market Regulation Chamber (CMED), which, on the basis of certain criteria, analyses the prices proposed by the companies as part of the registration process. The prices are regulated for different links of the supply chain: ex-factory (PF) and the Maximum Price for the Consumer (PMC):

  • the PF is the maximum price allowed for commercialisation of a drug to pharmacies, drugstores and public administration entities; and
  • the PMC is the maximum price allowed for commercialisation of a drug to the final consumer.

The CMED also defines the Maximum Price to the Government (PMVG), which is a mandatory discount over the PF, and applicable for sales to the Public Administration, when the drug to be purchased is destined to comply with a court order or in cases where the drug is listed in the CMED's Resolution No 3/2020. In all other sales to the Government that do not fall into those situations, the company must observe at least the PF.

It is important to clarify that not all drugs have their prices regulated; for example, OTC drugs are not subject to this regulation.

Prices of medical devices are not regulated by the Agency, although certain economic information about prices is required by the ANVISA whenever a company intends to register or renew the registration of a product.

In order to determine the maximum price of the drug, companies must submit economic data on the product and propose a suggested price. The rationale to establish the maximum ex-factory price will depend on the category of the drug. For example, new drugs cannot exceed the lowest price charged between nine different countries, which are the United States, New Zealand, Australia, Greece, Portugal, Italy, Spain, France, and Canada. Generic drugs cannot exceed 65% of the price of the corresponding reference drug. For drugs with a new presentation, the price cannot exceed the arithmetical average of the prices of the presentations of medicines marketed by the company with the same concentration and pharmaceutical form.

The Brazilian Federal Constitution of 1988 determines that health is a right of all and a duty of the state. Consequently, Brazil has a public healthcare system funded by the government, named the Unified Health System (SUS), which provides free and universal coverage. Thus, all individuals have the right to receive drugs and medical devices free of costs.

In view of this, the government established the Clinical Protocol and Therapeutic Directive (PCDT) in order to define the products/procedures that may be provided for individuals by the public healthcare system.

There are public pharmacies where the individuals may acquire some of these products free of charge, there are public hospitals that may provide the products/procedures and also the SUS provide financial support to private health institutions by financial grants and reimbursement of medical procedures, devices and drugs upon agreement between the private entity and the Ministry of Health. The reimbursement values and covered procedures and therapies are formally listed.

In 2020, the Supreme Court decided that the government is not obliged to pay for high-cost drugs that are not incorporated by the SUS (even if the drug is registered before the ANVISA), except in extraordinary cases; the Supreme Judges have not yet reached a consensus on the criteria for the characterisation of an extraordinary case. 

The main regulation determining the rules for price registration is the CMED's Resolution No 2/2004. According to this rule, the price depends on the assessment of the improvement to the treatment in relation to pharmaceuticals already used for the same therapeutic indication. There is no cost-benefit analysis.

The cost benefit is analysed by the Ministry of Health in order to include a drug list of products supplied by the SUS, with the support of the National Commission for Incorporation of Technologies in the SUS (Conitec), a multi-disciplinary collegiate formed by government representatives and civil society members, with advisory attributions related to the incorporation, exclusion or alteration of health technologies supplied by the SUS, as well as in the constitution or alteration of the PCDT. The analysis of the incorporation in the SUS list includes cost-benefit assessment, but does not impact the prices registered with CMED.

Prescriptions by physician are regulated by the ANVISA and also by the Medical Council through Resolution No 1931/2009 and the Medical Code of Conduct.

With regard to dispensation by pharmacies, the main legal framework is (i) Federal Law No 5,991/1973, which defines and regulates the sanitary control of drug stores and pharmacies, and (ii) Federal Law No 13,021/2014, which classifies pharmacies as health establishments and define the responsibilities of the owners and technical responsibility.

There are also other rules issued by the ANVISA that are extremely important for the business, such as Resolution RDC No 275/2019 (which provides for the AFE and AE necessary for the pharmacies' operation), and Resolution RDC No 44/2009 (which provides for Good Pharmaceutical Practices for the sanitary control of the functioning, dispensing and commercialisation of products and the provision of pharmaceutical services in pharmacies and drugstores), among others.

The ANVISA has no specific regulation on medical apps. In order to try somehow to regulate the matter and clarify which software may be considered as a medical device, the ANVISA published Technical Note No 4/2012; however, the prevailing view is that this rule is outdated and insufficient. There are initiatives in the agency to create a modern regulation.

Before the pandemic, telemedicine in Brazil was only ruled by Resolution No 1,643/2002, issued by the Federal Council of Medicine, which is a brief and outdated resolution that does not provide for all the current aspects, innovations and technologies related to recent telemedicine developments. In a nutshell, the resolution defines "telemedicine" as the rendering of medical services through interactive audio-visual communication methodologies with the purpose of assistance, education and research in health. The resolution does not provide for details in teleconsultation, telediagnostics and teleprescription.

In the past, and before the pandemic, there was an attempt to update this rule; however, the proposed new rule was quickly repealed.

Due to the pandemic and quarantine measures, telemedicine was temporarily authorised by the Ministry of Health (through Ordinance No 467/2020 and Federal Law No 13,989/2020). Such rules provide that telemedicine is authorised during the coronavirus pandemic, since in accordance with the requirements provided in the regulation.

Drug advertising is strongly regulated by the ANVISA Resolution RDC No 96/2008, which provides that advertisement for under-prescription drugs must not be made to the general public, but only to prescribing or dispensing Healthcare Professionals (HCPs), provided that all required conditions are met.

OTC drugs may be advertised through electronic means, but there are several conditions to be met, such as:

  • off-label promotion is prohibited;
  • a product's registration numbers before the ANVISA must be indicated in advertisement materials - unregistered products must not be promoted;
  • clinical and therapeutic claims in advertising material related to the drug are based on substantiated scientific data that has clinical and statistical significance;
  • information inserted in advertisement material is consistent with the information provided to the ANVISA and with duly published and approved technical literature and scientific papers, as well as in accordance with regulatory and legal requirements; and
  • advertisements include the required warning messages.

There is no specific law in Brazil on electronic prescription. However, the guidelines contained in CFM Resolution No 1,821/2007 regarding electronic health records apply to the prescription procedure. The document allows the practice, as long as it respects the technical standards of traditional medical prescriptions. In addition, prescriptions must follow strict safety criteria.

Due to the pandemic, the issuance of prescriptions by electronic means via telemedicine consultations was allowed (through Ordinance No 467/2020) upon the observance of the following conditions.

  • The use of an electronic signature, by means of certificates and keys issued by the Brazilian Public Key Infrastructure (ICP-Brasil).
  • The use of data associated with the physician's signature in a way such that any subsequent modification can be detectable.
  • Compliance with the following requirements:
    1. identification of the physician;
    2. association or data attachment in electronic format by the physician; and
    3. admittance by the parties as valid or accepted by the person to whom the document is opposed.

Electronic prescription is acceptable for this temporary period.

According to the applicable regulation (notably, ANVISA Resolution RDC No 44/2009), the sale of drugs and medical devices through the internet by pharmacies and drugstore chains is possible, but certain special conditions must be met. For example, only in pharmacies and drugstores with physical premises and that are open to the public, duly licensed, and with a technically responsible person present at the premises during the entire time that the establishment is open, may the release of drugs be ordered remotely, such as by telephone, facsimile and the internet.

However, the online sale and home-delivery of drugs subject to special control is prohibited. There are no restrictions regarding medical devices.

Health/medical data is regulated in the Brazilian Code of Medical Ethics and complementary regulations issued by the Federal Medical Council and by the Ministry of Health. Basically, these rules provide for the general integrity and confidentiality of medical data and determine that a patient's prior and express consent is an essential element for the use of any medical data, whether by the physician who collected the data or by any third parties, including healthcare providers. Disclosure without prior consent may be deemed a violation of doctor-patient confidentiality.

In general, Federal Law No 13,787/2018 allows the scanning and use of digital systems to keep, store and handle patients' medical records. According to this Law, the scanning must ensure the integrity, authenticity and confidentiality of the documents, and the digital version must reproduce all the information contained in the original document.

In addition, digital documents must be controlled through a specialised electronic document-management system, in accordance with the characteristics and requirements to be defined in a specific regulation.

Although no regulation was issued after 2018 for defining any such characteristics and requirements, Resolution No 1,821/2007, issued by the Federal Medical Council, should be used as a guideline. According to the resolution, an electronic management system must:

  • have enough capacity to utilise the stored data;
  • have an index method, allowing simple research and filing organisation; and
  • ensure the level of information security (Level II - NGS2, which is granted by an accredited entity in Brazil).

Patents are regulated in Brazil through Federal Law No 9,279/1996 (IP Law).

Although the Brazilian Patent Office's examination criteria and guidelines for pharmaceuticals and biotech inventions are generally aligned with international standards, historically the issues which are most commonly encountered by pharmaceutical and medical devices products under the legislation relate to secondary inventions, for instance inventions on formulations, combinations of new compounds, second and further medical uses, salts and polymorphic forms of known compounds, and selection inventions, among others.

In addition, restrictions on the possibility to submit claim amendments and file divisional applications after the examination request are a concern of applicants in general.

As to the patentability requirements, under Article 8 of the IP Law, the main requirements for the grant of a patent are novelty, inventive step and industrial application. Other requirements such as sufficient description and enablement are also provided by the Law. Those requirements are required for all kind of patents; there is no specific requirement to pharmaceuticals or medical devices. However, a peculiar aspect of Brazilian patent law is that, since 1999, the grant of pharmaceutical patent applications has been subject to the ANVISA’s prior approval, pursuant to Article 229-C of the Patent Act.

In addition, under the Brazilian IP Law, all products, substances and processes can be protected, except for those that are incurred in the prohibitions of Articles 10 and 18 of the IP Law, which are worth mentioning:

  • operating or surgical techniques and therapeutic or diagnostic methods, for use on the human or animal body (possibly patentable if rewritten as Swiss-type claims);
  • natural living beings, in whole or in part, and biological material, including the genome or germ plasma of any natural living being, when found in nature or isolated therefrom, and natural biological processes;
  • inventions which are contrary to morals, good customs and public security, order and health;
  • substances, matter, mixtures, elements or products of any kind, as well as the modification of their physical-chemical properties and the respective processes of obtaining or modifying them, when they result from the transformation of the atomic nucleus.

In Brazil, second and subsequent medical uses of a known product can be patentable as long as the patent requirements of Article 8 of the aforementioned IP Law are met, although a showing of new and surprising effects is usually required and the submission of test results is normally required by the Patent Office.

As to inventions on new dosage regimes, and new or selected patient populations, they are often rejected under a lack of clarity (Article 25) or for being considered to be related to a method of treatment.

As a general rule, manufacturing, using, offering for sale, selling or importing for such purposes, without consent, a process, or product directly obtained by a patented process, is considered patent infringement.

For a patent on second or subsequent uses, the product that is alleged to infringe must have been approved for the same new use, or a showing of off-label use must be provided.

According to Article 40 of the IP Law, a patent is valid for 20 years counted from its filing date. In addition, a sole paragraph of Article 40 (which is currently under discussion before the Supreme Court) establishes that the term of protection cannot be less than a period of ten years from the date of grant of a patent.

Besides these possibilities, there are no mechanisms for patent-term extensions available in the law.

Article 42 IPL defines the acts which constitute patent infringement.

Applying for marketing approval is allowed by the IP Law, under what is called the Bolar exemption. 

However, if the patent-holder is able to prove that the other party is taking all necessary steps to infringe its patent during the patent term, it is possible to obtain a restraining order against the possible infringer. The requirement for this "imminent" infringing may include the marketing approval request and other information that indicates that the other party will (or is required by law) to launch or pursue other infringing activities during the patent term.

As previously mentioned, applying for marketing approval is exempted from infringement under the Bolar exemption. Experimental use is also allowed in Brazil, and is a common defence in patent-infringement cases.

In addition to the foregoing, defendants in patent-infringement cases often argue the invalidity of the plaintiff's patent as a defence argument.

A trend in pharmaceutical patent-infringement cases is an argument related to the unconstitutionality of the sole paragraph of Article 40 (ie, ten years counted from the grant of the patent) arguments based on Article 32 of the IP Law, which is interpreted by the Brazilian Patent and Trade Mark Office (BPTO) in a very restricted way to limit the applicant's ability to present voluntary amendments after the examination request.

According to the IP Law, the patent-holder may be compelled to provide a compulsory licence if:

  • it exercises the rights resulting from a patent in an abusive manner;
  • it practises abuse of economic power that is proven under the terms of the law by an administrative or court decision;
  • the object of the patent is not explored in the Brazilian territory, by lack of manufacture or incomplete manufacture of the product or, furthermore, by a lack of complete use of a patented process (except in the case of non-exploitation due to economic unviability, when importation will be admitted);
  • commercialisation does not meet the needs of the market.

In addition, the Government may request a compulsory licence in cases of public interest or national emergencies.

According to Article 42 of the IP Law, the patent-holder has the right to prevent a third party, without his or her consent, from producing, using, offering for sale, selling or importing the product covered by the patent, or the process or product obtained directly by the patented process.

As a general rule, the burden of the proof falls on the plaintiff (except in the case of infringement of a process patent), who often presents documentary evidence in advance, including technical and legal opinions.

Invalidity is an available defence and may be argued in the same infringement case in the answer brief or through the filing of a separate invalidity case before Federal Courts, including the Brazilian Patent Office as a mandatory defendant.

In summary, in a typical proceeding, after the defendant is duly served of the complaint, he or she normally has 15 days to file an answer, where all possible defences, including counterclaims of invalidity, shall be presented together with the supporting evidence. In an infringement case, both parties often ask the court to allow the production of further evidence during the proceeding, most importantly the production of technical evidence by an expert to be appointed by the court at a later stage. The plaintiff then has a ten-day term in which to file a reply brief, before the judge decides on the requests made by each party regarding evidence production. At this stage, the court may also identify issues that are not under dispute and decide any preliminary argument raised by the parties. If the production of technical evidence is required, the judge will then appoint a trusted expert to prepare a technical report that will be used to assist the court. Given its importance, the court expert may be challenged by the parties due to lack of technical expertise, credibility or partiality. Parties may elect their own experts to interface with the court-appointed expert and provide any clarification he or she may need. Parties may also submit technical questions to be answered by the court expert pertaining to infringement and validity. After the court-appointed expert files his or her report with the court, and the parties submit their own arguments regarding that report, the judge will then set a date for closing arguments (in paper) and a date for trial. If no oral evidence is needed, the court may also render a final judgment without a trial. The pre-trial stage may take from six to 12 months. In the case that any party contests the court-appointed expert’s nomination, and depending on the complexity of the case, this schedule may be substantially delayed.

In patent-infringement actions, one of the remedies is that it is possible to request is a preliminary injunction. If the legal requirements set out in Article 300 of the Code of Civil Procedure are met, the court can grant such a remedy, which has the most different scopes, such as immediately ceasing the marketing of a product allegedly infringing the patent, guarantee of payment of a compensation for moral damages, among others. Therefore, if the patent-holder is able to prove that the other party is taking all necessary steps to infringe its patent during the patent term, it is possible for him or her to obtain a restraining order against the possible infringer through a request of preliminary injunction by the plaintiff (patent-holder).

There is no patent linkage or established proceeding for a potential generic entrant during the process of marketing approval.

At the same time, the ANVISA will not prevent or delay marketing approval based on exclusivity rights.

Therefore, a generic company will usually need to file a patent-invalidity case before launch to be on the safe side or wait for the patent term to expire.

According to Articles 183 to 186 of the IP Law, anyone who commits a crime against the patent should be held criminally liable when they manufacture a product that is the subject of a patent without authorisation from the patent-holder, or uses a means or process that is the subject of a patent, without authorisation from the patent-holder. The penalty for those who commit this crime is ten to 15 years' imprisonment, and a fine. In addition, according to Article 273 of the Penal Code, counterfeiting, corruption, adulteration or alteration of a product intended for therapeutic or medicinal purposes constitutes a crime against public health. The penalty for those who commit this crime is three months to one year's imprisonment, or a fine.

It is important to mention that the ANVISA also has a great role in the inspection of pharmaceutical products and medical devices, through the implementation of the National Medicines Control System, set out in the ANVISA's Resolution RDC No 59/2009. Besides that, the ANVISA is the public body responsible for registering medicines and authorising the operation of pharmaceutical laboratories and other companies in the pharmaceutical chain.

As a general rule, pharmaceutical products with different therapeutic indications are considered similar to at least some extent, mostly in view of the following aspects:

  • they are inserted in the same market segment, that is, the pharmaceutical industry;
  • they are ultimately used for the same purpose, that is, treating and healing medical diseases and disorders;
  • the heterogeneous profile of drug consumers, all of which can give rise to:
  • an enduring potential risk of confusion and the chance of wrongful association between these products.

Accordingly, the Brazilian Patent and Trade Mark Office (BPTO)’s Trade-mark Examination Guidelines establish that trade-mark conflict analyses involving products that interfere with human health, such as pharmaceutical substances and preparations, and medical devices, have to be carefully examined due to the serious impacts that the confusion between the trade marks may cause.

Moreover, Article 5, caput, of Federal Law No 6,630/76, which deals with sanitary surveillance in Brazil, establishes that medicines, drugs, pharmaceutical inputs and related products may not have names, designations, labels or packages, leading to error. Paragraph 1 of the same Article also states that the adoption of an equal or similar name for products having different compositions is forbidden, even if they are from the same manufacturer.

Although the ANVISA has its own rules for naming pharmaceutical products, those rules and the decisions arising from their application do not legally impact on the assessment of a likelihood of confusion by the BPTO.

The ANVISA, as the main authority responsible for regulating the pharmaceutical market in Brazil, has the power to authorise the operations of companies manufacturing, distributing and importing medicines and medical devices in general.

The trade dress of a product (ie, representation of the packaging containing the mark and additional visual elements) or of a service (ie, representation of the physical space where the products or services are offered) cannot be registered as a trade mark.

The trade dress over a label, however, may be protected as a word-and-design mark. In fact, this type of registration has become quite common in Brazil, including in the pharmaceutical area.

Trade dress cannot be protected under Brazilian Copyright Law either. Some elements forming the trade dress may be subject to copyright protection, such as artistic drawings. However, the label, packaging or visual representations of a space, as a whole, do not fit the requirements for protection under copyright laws.

Likewise, trade dress cannot be protected as industrial designs. This is because Brazilian IP Law provides that industrial designs are the ornamental plastic form of an object or the ornamental set of lines and colours that can be applied to a product, providing a new and original visual result in its external configuration, and which may be applied in industrial manufacturing. 

Brazilian IP Law does not address the registration of trade dress, which means that the trade dress of pharmaceuticals and medical devices is not registrable before the BPTO.

In order to be protected in Brazil, a trade dress must satisfy three conditions: (i) distinctiveness (which may be inherent or acquired), (ii) have no functional character, and (iii) likelihood of confusion.

In Brazil, the protection and enforcement of trade dress result from provisions against unfair competition and must be recognised by a State Court through the filing of a lawsuit.

According to the Civil Procedure Code, it is possible for trade dress-owners to obtain injunctions against infringers demanding them to cease the manufacturing, launching, use, reproduction, offering for sale, sale or import of the infringed trade dress in the market. Injunctions are only granted: i) when there is risk of irreparable harm caused by the infringement and delay in having a final court decision, or ii) to anticipate the effects of the final decision in view of strong evidence that the plaintiff’s claim is well grounded. In both cases, strong evidence of the alleged infringement and of the potential of irreparable harm must be submitted to the judge.

The IP Law provides that it is a crime of unfair competition to use and exploit data, test results and other undisclosed information submitted to the health authorities for marketing approval. This is provided in Article 195, IV of the IP Law, as well as in Article 39.3 of the WTO TRIPs Agreement, internalised by Decree 1,355, of 1994, and Articles 6, III, 22, of Law 12,527, of 2012.

However, the law does not use the term "data package exclusivity", nor does it define a term for protection.

The ANVISA has issued several resolutions to combat the COVID-19 pandemic scenario, on an extraordinary and temporary basis, as well as exceptions to regulatory requirements.

Commercialisation or Distribution of Medicinal and Medical Devices

For this purpose, the ANVISA issued Resolution No 346/2020, which simplifies the procedure for certification of good manufacturing practices, registration and post-registration of medicines and medical devices - directly related to the commercialisation of the product, once it is a prerequisite for companies of the industry.

Additionally, there is a commitment by the Agency to prioritise the products (directly or indirectly) associated with COVID-19.

Relaxation of the Applicability of the Legal Framework

In turn, the applicability of the public tender procedure was dismissed in the case of the acquisition of goods, services, and inputs aimed at containing the COVID-19 pandemic scenario, based on Federal Law No 13,979/2020 (and Ordinance No 188 of 3 February 2020, which provides that the COVID-19 pandemic shall be deemed a public health emergency), published by the Federal Government.

Also, certain conditions have been relaxed regarding the requirements in the case of corporate permits for sanitisers and certain medical devices, along with the extraordinary approval of importation of products that are not registered in Brazil.

The ANVISA also allowed the manufacturing, importation and acquisition of certain medical devices (eg, masks, face shields, protection, hospital gowns, caps and thongs, circuits, valves and respiratory connections) by companies without AFE and other authorisations issued by the health authorities.

Special Measures in Relation to Ongoing Clinical Trials

The ANVISA issued Technical Note No 3/2020, as guidance for sponsors, researchers and institutions involved in ongoing clinical trials, and indicated that it is open to discussion about ongoing trials in order to mitigate issues and protect research subjects during the COVID-19 crisis.

The Agency has invited the relevant stakeholders to discuss the challenges and to implement pathways to deal with them, but has authorised, for example, home delivery of the investigational product whenever the product could be used at home by the research subject.

Special Regulation in Relation to COVID-19 Treatments or Vaccines

In pursuance of enabling the immunisation on an emergency basis of the Brazilian population, the ANVISA issued Resolution No 444/2020 and Guide No 42/2020, providing for the temporary authorisation, on an experimental baseline, for the COVID-19 vaccines.

This regulation also encompasses imported vaccines, which must comply with the requirements provided for in both the Resolution and the Guide.

The temporary authorisation is valid until the recognition by the Ministry of Health that the COVID-19 pandemic no longer configures a public health emergency (as provided for in the Ordinance No 188/2020).

The ANVISA issued Resolution No 346/2020, responsible for establishing the extraordinary and temporary requirements for approvals of pharmaceuticals and medical devices.

The main characteristics are related to the manufacturing certification, presented in 11.4 Flexibility in Manufacturing Certification as a Result of COVID-19.

Considering that the process of manufacturing, which requires the Good Manufacturing Practices Certification, the registration and the commercialisation of medicines and medical devices in Brazil are intrinsically correlated, for details of any simplification or flexibility introduced in relation to obtaining required certifications due to COVID-19 (eg, automatic renewal or temporary extensions), see 11.1 Special Regulation for Commercialisation or Distribution of Medicines and Medical Devices and 11.3 Emergency Approvals of Pharmaceuticals and Medical Devices, in which Resolution No 346/2020 is indicated as having responsibility for regulating these matters.

The flexibility consists of the possibility of using remote inspection mechanisms, rather than face-to-face inspection.

Also, for the purpose of GMP Certification, the Resolution No 346/2020 provides for the possibility of temporary and emergency use of information from Foreign Regulatory Authorities, replacing inspections carried out by the ANVISA.

The Foreign Regulatory Authorities currently recognised for this purpose are the following:

  • the PIC/S (Pharmaceutical Inspection Co-operation Scheme), for certification related to active substances;
  • the MDSAP (Medical Device Single Adult Programme), for certification related to medical devices; or
  • the Programme to Rationalise International GMP inspections of Active Pharmaceutical ingredients/active substance manufacturers, for certification related to active substances.

Restrictions

Since April 2020, the exportation of medical devices - personal protective equipment for healthcare use, such as latex gloves, surgical masks, face shields, respiratory connections and other devices used for the contention of the COVID-19 pandemic - is prohibited according to Federal Law No 13,993/2020.

This exportation restriction shall remain in force while the coronavirus pandemic persists and may be discharged only through an Administrative Act issued by the Executive Branch, duly justified and without slowing the provision of healthcare service for the Brazilian population.

Flexibilities

The customs authorities issued several provisions regarding the contention of the COVID-19 pandemic, mostly related to tariff reduction and suspension of trade defence measures. 

The most relevant digital health innovation in Brazil related to the COVID-19 pandemic is the allowing of telemedicine by the Ministry of Health, through Ordinance No 467/2020, in both the public and private health systems while the coronavirus pandemic persists.

Medical consultations must be held directly between the physician and patient only, through an IT system able to ensure integrity, security and confidentiality of information of the patient.

E-prescriptions are also permitted, on a temporary basis, but it demands a system issued by the Brazilian organisation of e-signature, with certifications and passwords.

Afterwards, the use of telemedicine during the COVID-19 pandemic will embrace any health services activities, according to Federal Law No 13,989/2020.

To date, no compulsory licences related to COVID-19 have been granted.

According to the IP Law, legal provisions regarding compulsory licences are provided in Articles 68-74 and Decree 3.201/1999, which regulates the compulsory licence based on Article 71 of IP Law (national emergency and public interest). These provisions would be applicable in a compulsory licence scenario in Brazil.

It is important to note that, in certain circumstances, including in the event of national emergencies or public interest which have been declared by the Executive Branch, a temporary and non-exclusive compulsory licence may be granted ex officio if the patent-owner or its licensee does not meet market needs.

This matter is under discussion on the political scene, with favourable evaluation by part of the National Congress, but resistance by the Executive Branch. Nevertheless, it should be noted that the Government sometimes sees compulsory licences as a negotiation strategy and in the past the Federal Government has used the threat of compulsory licensing as a strategy to drive down drug prices acquired by the MoH.

No regulation providing for liability exemptions regarding vaccines or treatments in Brazil has been issued.

The Brazilian Federal Constitution provides, in its Article 5, item XXV, the possibility of the Public Administration utilising private property in the event of an urgent public emergency.

Nonetheless, specifically regarding the COVID-19 pandemic, Federal Law No 13,979/2020 establishes that the public authorities may require goods and services from both individuals and legal entities.

These regulations ensure a legal basis for the requisition or conversion of manufacturing sites during the COVID-19 pandemic. In both cases, the public authorities must duly compensate the private party.

The Federal Government issued Ordinance No 188/2020, which deems the COVID-19 pandemic as a public health emergency. Furthermore, Federal Law No 13,979/2020, provides that the public tender procedure in the case of acquisition of goods, services, and inputs related to the COVID-19 pandemic is dismissed.

The aforementioned simplified procedure takes into consideration the following conditions:

  • the possibility of elaborating on a simplified Term of Reference or Basic Project;
  • exemption of performing preliminary studies in the case of common services and goods;
  • exemption of price estimate - even if presented, the Public Administration is not bound to it; and
  • in the case of reverse auction, the terms within the public tender procedure shall be reduced by half and the public hearing is dismissed.
Trench Rossi Watanabe (in co-operation with Baker McKenzie)

R. Arquiteto Olavo Redig de Campos
105 - Chácara Santo Antônio
(Zona Sul)
São Paulo - SP, 04711-904
Brazil

+55 11 3048 6800

Henrique.Frizzo@trenchrossi.com www.trenchrossi.com
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Law and Practice in Brazil

Authors



Trench Rossi Watanabe (in co-operation with Baker McKenzie) has been in the forefront of Latin America’s healthcare sector for more than 60 years, and understands the challenges that clients face, bringing first-hand insight to help overcome those challenges. The firm has been instrumental in training local authorities to detect counterfeit pharmaceutical products, and helping clients enter markets effectively, grow their business and obtain successful outcomes in controversies. Trench Rossi Watanabe has the industry-specific experience and capabilities necessary to execute complex corporate transactions, product registration and licensing agreements. The firm helps clients balance sometimes conflicting regulatory regimes and their impact on clients' expansion, manufacturing and distribution strategies. In challenging jurisdictions where counterfeiting is rampant, the firm protects clients' investments through proactive detection and prosecution. The firm mobilises the right talent to co-ordinate patent and trade mark protection, transfer pricing and tax planning, employment strategies, and the efficient resolution of disputes involving product liability and unfair competition. The firm has offices in São Paulo, Rio de Janeiro, Brasília, and Porto Alegre.