The Life Sciences Law Review: Brazil
'Health is a right of all and a duty of the State',2 according to the Brazilian Federal Constitution of 1988.
In Brazil, the public services related to the promotion of health constitute the Unified Health System (SUS). SUS is competent to 'control and oversee procedures, products and substances of interest to health',3 and to 'participate in the production of medicines, equipment, immunobiological products, blood products, and other inputs'.4
The National Health Surveillance Agency (ANVISA) is a self-governing agency linked to the Ministry of Health. The agency is responsible for 'promoting the health of the population, through the sanitary control of production and commercialisation of products and services subject to sanitary surveillance, including environments, processes, inputs and technologies linked to them, as well as the control of ports, airports and borders'.5
ANVISA was created in 1999. The sanitary surveillance regime is grounded on older rules, such as Federal Law. No. 5,991/1973, Federal Law No. 6,360/1976, and Federal Law No. 6,437/1977. These rules are associated with stricter policies regarding health control, sanitary infractions and the corresponding sanctions.
Federal Law No. 6,360/1976 establishes as products under sanitary surveillance: medicines, drugs, pharmaceutical inputs, medical devices, hygiene products, cosmetics, perfumes, household sanitising products, products intended for aesthetic correction and others furtherly defined.
The Ministry of Agriculture, Livestock and Supply (MAPA) has the competence to regulate agricultural inputs, such as fertilisers, corrective products, inoculants, plant substrates, as well as food products of animal and plant origin and livestock welfare, which includes feed products.
The regulatory regime
Some classifications are expressly defined by Federal Laws. For example, the definitions for 'medicine', 'drug' and 'pharmaceutical input' are defined by Federal Law No. 5,991/1973. Within the legal boundaries, ANVISA has the corresponding competence to issue regulations on the classification of the products subject to sanitary surveillance. Borderline cases are decided by the agency, with the issuance of a decision or a new regulation by the board of directors.
In case of new technologies that have not yet been subject to specific regulation, ANVISA's technical areas may issue orientations on the classification of products. That is the case involving software of medical devices, for example. Although health software has not been subject to a specific ANVISA Resolution so far, one of the agency's technical areas has issued guidance on how to differentiate software as a medical device, software as part of a medical device and software that is not a medical device.
ii Non-clinical studies
ANVISA requires pharmacological and toxicological data derived from non-clinical studies to authorise a clinical trial. These studies must be performed according to Good Laboratory Practices (BPL). The BPL correspond to a 'quality system covering the organisational process and conditions under which non-clinical health and safety related environmental studies are planned, developed, monitored, recorded, archived, and reported'.6
ANVISA published a guide in 2013 regarding the performance of non-clinical trials of toxicology and pharmacological safety, which are necessary for the development of drugs. The guide mentions that non-clinical studies must comply with the Principles of Good Laboratory Practice from the OECD and the Handbook Good Laboratory Practices (GLP) from the World Health Organization (WHO), whenever applicable.
According to the guide, the animals must be healthy, stated as specific pathogen free (SPF), must be from known origin and possess age and weight compatible with the experiment.
Experiments with vertebrate animals (subphylum Vertebrata, phylum Chordata) are regulated by the National Council for the Control of Animal Experimentation (CONCEA). CONCEA is responsible for regulating and monitoring the humanitarian use of animals in scientific research.
iii Clinical trials
There are two main authorities that regulate clinical trials in Brazil: ANVISA and the National Health Council (CNS). ANVISA regulates the clinical trials of medicines through Resolution ANVISA No. 9/2015 and the clinical trials of medical devices through Resolution ANVISA No. 548/2021. CNS regulates the ethical aspects of studies involving human beings through Resolution CNS No. 466/2012.
To be performed, a clinical trial must obtain the regulatory approvals from ANVISA and from the CEP/CONEP System. This system is composed of the local research ethics committees (CEP) and by the National Commission for Ethics in Research (CONEP), which are all linked to CNS.
The sponsor of the clinical trial must be identified before the authorities. The sponsor may be responsible for managing the clinical trial or it may hire a contract research organisation (ORPC) to assume all or some of the regulatory obligations. Hiring an ORPC may be particularly advantageous in case the sponsor is not established in Brazil through a parent company or subsidiary.
There is also the possibility of a clinical trial being initiated and fully conducted by the investigator. In this case, the investigator is called a sponsor-investigator, a physical person that develops the trial with its own financial resources and materials, as well as resources from research funding bodies, private entities and non-profit organisations.
Clinical trials in Brazil must follow harmonised guidelines for Good Clinical Practice (BPC) as set forth in PAHO's Document of the Americas and in ICH's Guideline for Good Clinical Practice (Document E6), as well as specific BPC regulation issued by ANVISA.
As determined by good clinical practices, informed consent must be obtained from the subjects or their legal representative through a written document, the Informed Consent Form (TCLE).
The investigator is responsible for communicating all adverse events to the CEP/CONEP system and to the sponsor. The sponsor, by its turn, must notify ANVISA of all unexpected serious adverse events (EAGs) identified during the study. Phase III clinical trials must be accompanied by Independent Safety Monitoring Committees whose recommendations must be presented to ANVISA by the sponsor.
According to Resolution CNS No. 466/2012, at the end of a clinical trial, the participants are entitled to free indefinite access to the best proven prophylactic, diagnostic and therapeutic methods. The absence of a time limitation to the guarantee of free access has raised the industry's concerns regarding the post-study costs, especially in the case of high-cost medicines. In 2017, CNS issued Resolution No. 563/2017 regarding the post-study access to treatment of ultra-rare diseases.7 This Resolution established a five-year term, from the date of registration, for the subject's free access to the best proven prophylactic, diagnostic and therapeutic methods, in case of ultra-rare diseases.
iv Named-patient and compassionate use procedures
ANVISA regulates two different procedures through which a patient may access drugs before the marketing authorisation is granted: compassionate use and expanded access programmes.
A compassionate use programme is a programme conducted for 'a new promising drug for the personal use of patients who are non-participants of an expanded access programme or clinical trial, which has not yet obtained a marketing authorisation before ANVISA, that is in process of clinical development, intended for patients with serious debilitating or life-threatening diseases and without satisfactory therapeutic alternative registered in the country'.8
ANVISA's approval for compassionate use is personal and non-transferable. To obtain approval for the programme, there must be enough scientific evidence for the therapeutic indication. Also, the drug may be in any clinical development phase, provided that the initial information is promising, and the severity of the disease and the absence of available treatments are proven.
An expanded access programme is a programme to make available a 'promising new drug, which has not yet obtained a marketing authorisation before ANVISA or is not commercially available in the country, that is currently in or concluded a phase III of a clinical trial, directed for a group of patients suffering from severe or life-threatening debilitating diseases and without satisfactory therapeutic alternative with registered products'.9
Expanded access programmes are available to a certain group of patients who were not subjects of a clinical trial because of lack of access or because they did not meet the inclusion criteria.
The programme approval procedure begins with a request from the sponsor or the contract research organisation (ORPC) to ANVISA. In case of both programmes, the sponsor must support the patients with free access to the drug without time limitation, according to medical recommendation. The sponsor must also provide full assistance to the patient in case of complications or damages, foreseen and unforeseen, associated to the use of the programme's drug.
The responsible physician must notify the sponsor of the occurrence of EAGs. The sponsor is responsible for notifying ANVISA of such events.
Until this date, there are no similar programmes regarding medical devices. Nonetheless, in June 2021, ANVISA published Public Consultation No. 1,049/2021 with a proposal of regulation for the compassionate use of medical devices. ANVISA has already received the contributions to the proposal and should publish a new Resolution on the matter.
v Pre-market clearance
To be marketed in Brazil, a product must be regularised before ANVISA by a Brazilian company. Thus, the regulatory pathway for obtaining a marketing authorisation begins with the incorporation of the legal entity in the country.
After establishing the legal entity, the company must obtain the necessary permits and licences before ANVISA and the local sanitary authorities, for each activity it intends to perform, such as sales, distribution, importation, exportation, among others.
After obtaining clearance to practice its activities, the company may submit a request for the marketing authorisation of a product.
For each of these regulatory steps, the company must file a petition before ANVISA, or before the local authority, and pay the corresponding fee. The values may vary according to each type of fee, the complexity of the sanitary surveillance services involved in the activity and the company size. For example, the petition for certification of GMP of a medicines production line in Brazil and Mercosur may cost nearly 30,000 reais if the company size is deemed as big and nearly 3,000 reais if it is deemed as small.10
There are different types of marketing authorisations, according to the product the company intends to market. Medicines are subject to registration, which encompasses a previous technical analysis before ANVISA's decision on the approval. Medical devices may be subject to registration or notification, depending on the risk classification of the product. Notification is intended for lower-risk medical devices, as it is a simpler administrative procedure that waives prior technical analysis for the product's regularisation.
There are also fast-track procedures for special products, such as medicines intended for neglected diseases, public health emergencies or the paediatric population, as well as vaccines and hyperimmune serums to be incorporated into the Ministry of Health's National Immunisation Programme and medicines considered as strategic to SUS.
Generic drugs may be subject to fast-track registration procedures, provided that the product is one of the first three generic drug applications for an active pharmaceutical ingredient or association and pharmaceutical form. To obtain fast-track approval, the three generic drug applications must be from different economic groups.11
vi Regulatory incentives
The patent analysis by the Brazilian Patent and Trademark Office (BPTO) and the marketing authorisation procedure before ANVISA are independent administrative procedures that do not communicate with each other.
Until August 2021, BPTO's procedure for patent analysis had to be preceded by ANVISA's prior consent in case of patents for pharmaceutical products and processes, due to Section 229-C of the Brazilian Industrial Property Law (Law No. 9,279/1996). That mechanism was deemed responsible for delays in the analysis of many patent requests related to pharmaceutical products.
On 26 August 2021, Section 229-C was revoked by Law No. 14,195/2021. Since then, ANVISA no longer has a role in the analysis of pharmaceutical patents, which should speed up the patent analysis procedure.
In 2014, the Ministry of Health issued a specific Ordinance regarding the National Policy for the Integrated Care of People with Rare Diseases.12 This Policy aims to act towards the promotion, prevention, early detection, timely treatment, reduction of disability and palliative care for people with rare diseases.
In line with this policy, ANVISA issued special rules for the approval of clinical trials to be conducted in Brazil for the evaluation of medicines for rare diseases, the GMP certification for medicines for rare diseases and the marketing authorisation for new medicines for rare diseases. In case of ultra-rare diseases, CNS established a five-year term, from the date of registration, for the subject's free access to the best proven prophylactic, diagnostic and therapeutic methods.
During the covid-19 pandemic, ANVISA issued many exceptional and temporary rules to facilitate the importation, commercialisation and distribution of products considered as essential in the fight against the virus. The products encompassed by these rules were mainly medicines used for the intubation of patients, medical devices used in intensive care units, personal protective equipment, and medical gases.
vii Post-approval controls
Any marketing authorisation holder must have a post-approval control of its products placed on the market.
In case of medicines, the company must establish and maintain a well-documented pharmacovigilance system in Brazil, which must encompass a standard operating procedure for the pharmacovigilance-related processes, periodic reports about the safety of the products and a risk-management plan.13 The pharmacovigilance system must be controlled by a professional with a duly trained staff of a number that is compatible with the pharmacovigilance activities.
Likewise, medical device companies must establish and maintain a techno-vigilance system. The techno-vigilance system is a 'surveillance system of adverse events and technical complaints of medical devices in the post-commercialisation phase'.14 The system must encompass risk-management operations and must be controlled by a professional with a higher education degree and registered in the professional council.
It is possible to make post-approval amendments to marketing authorisations of medicines and medical devices. The petition of amendment must follow ANVISA's subject code criteria and must be accompanied by payment of the corresponding fee.
ANVISA establishes the procedure of transfer of ownership in case of corporate or commercial operations between companies.15 According to this procedure, the current holder of the marketing authorisation must file the petition to revoke the products' approval on the same day the successor files the petition to obtain the approval. ANVISA publishes the transfer by revoking the previous approval and granting the new one on the same day.
The marketing authorisation holder may request the cancellation of the product's approval on its own request. The marketing authorisation approval may also be revoked or suspended by ANVISA as a sanction related to a sanitary infraction.
viii Manufacturing controls
To manufacture products subject to sanitary surveillance in Brazil, a company must possess a permit from ANVISA (an AFE) specifically for that activity. In case the company intends to sell a product manufactured in a different country, then, depending on the product, it may need to obtain a Good Manufacturing Practices certificate (GMPc). Once published on the Official Gazette, the GMPc is valid for two years.
To grant a GMPc, ANVISA will inspect the manufacturing site. In case of factories outside of Brazil, ANVISA may also request information to other regulatory agencies and third-party audit bodies recognised by ANVISA.16
In case of medicines and medical devices, the GMPc is granted for each establishment, per production line. Medical devices of lower risk classes (risk classes I and II) are not subject to GMP certification.
In case of transfer of ownership, the successor company must update the company's data before ANVISA. The transfer of ownership of manufacturing facilities does not imply a new certification of GMP, provided that the technical and sanitary conditions of the manufacturing site remain the same.
ix Advertising and promotion
The advertising and promotion of medicinal products is regulated by Federal Laws No. 6,360/1976 and No. 9,294/1996, as well as by the Brazilian Federal Constitution (Section 220, Paragraph 4).
The advertising and promotion of products subject to sanitary surveillance cannot induce false interpretation, error, or confusion as to the origin, provenance, nature, composition or quality, and that attribute to the product different characteristics and purposes from those it actually has.17
Prescription medicines and medical devices may only be advertised through publications strictly directed towards healthcare professionals, namely physicians, dental surgeons and pharmacists.
The advertising of over-the-counter medicines to the public is allowed. The companies must, however, follow the rules regarding advertisement and promotion of medicines, such as Resolution ANVISA No. 96/2008. There are expressions that must appear in the advertisement of specific over-the-counter medicines, depending on the active substance and its contraindications.
This rule also prohibits the stimulation of the indiscriminate sale of medicines, the suggestion of diagnosis to the public, the use of images of people taking the medicine, the suggestion that the product may have pleasant organoleptic features, such as good taste or good smell, through images or expressions, the noncompliant promotion of generics, among other actions.
There is no similar rule for the publicity of medical devices. Nonetheless, there are industry codes regarding the medical devices market that establish as good practices that medical devices should be advertised only to healthcare professionals, in accordance with the product's marketing authorisation.
The violation of advertising and publicity rules constitute a sanitary infraction and may subject the company to the penalties addressed in Federal Law No. 6,437/1977, such as warning, fine, suspension or prohibition of advertisement, suspension of sales and imposition of a rectifying message.
x Distributors and wholesalers
Distributors and wholesalers of medicines and medical devices must obtain the necessary and specific permits before ANVISA and the local sanitary authorities.
To distribute medicines and medical devices, companies must comply with the good distribution and warehousing practices and obtain the corresponding certification. The certification is issued per establishment.
Distributors may act as marketing authorisation holders of imported products subject to sanitary surveillance in Brazil. In this case, the distributor shall be licensed as importer and shall sign an agreement with the foreign manufacturer to properly assign regulatory responsibilities according to the Brazilian law and regulation.
xi Classification of products
The regulation distinguishes between prescription medicines, that may only be marketed under the presentation of a prescription, and over-the-counter (OTC) medicines, that may be marketed without a medical prescription.
To be an OTC medicine, a product must be on the market with the same indications, administration route and therapeutic range for at least 10 years, including five years of commercialisation in the Brazilian market. Medicines may also become OTC medicines if marketed for five years abroad in the same conditions as specified in the Brazilian regulation for over-the-counter medicines.18
In addition, to become an OTC medicine, the company must prove that the product is safe when used without the guidance of a prescriber, including adverse reactions with known causes and that are reversible after the suspension of use of the medication, low potential for toxicity and low potential for clinically relevant food and drug interactions. The medicine must fulfil other requirements, such as being manageable by the patient and indicated for a short period of time, among others.
The classification as an OTC allows advertising strategies that target the lay public, instead of strategies exclusively directed to healthcare professionals, as is the case with prescription medicines.
OTC medicines may be displayed at the pharmacy or drugstore within the public's reach. Prescription drugs, by their turn, must be placed in areas restricted to the circulation of employees.
Prescription medicines may also be subject to special control depending on the active ingredient. Controlled substances are addressed by a specific topic in this article.
ANVISA regulates medical devices in Resolution ANVISA No. 185/2001. Medical devices are classified according to four different risk classes. Classes I to IV range from the lowest to the highest risk level associated to medical devices. Products of lower risk classes (classes I and II) are subject to a simpler form of marketing authorisation called notification. Products of higher risk classes (classes III and IV) are subject to the registration procedure.
Products are also classified within the four risk classes according to four different categories and 18 rules:
- non-invasive products (rules 1, 2, 3 and 4);
- invasive products (rules 5, 6, 7 and 8);
- additional rules applicable to active medical devices (rules 9, 10, 11 and 12); and
- special rules (rules 13, 14, 15, 16, 17 and 18).19
xii Imports and exports
Federal Law No. 9,782/1999 assigned to ANVISA the health control of ports, airports, and borders. Resolution ANVISA No. 81/2008 is the main regulation of imports subject to sanitary surveillance.
To import health-related products, the importer must obtain a specific permit (AFE) for that activity before ANVISA and follow the procedures set forth in the technical regulation (Resolution ANVISA No. 81/2008).
One of the most common procedures corresponds to the obtaining of ANVISA's previous and express approval through an import licence at the Integrated Foreign Trade System (SISCOMEX). SISCOMEX is an online platform coordinated by the Brazilian Federal Revenue and the Secretariat of Foreign Trade that integrates enforcement actions related to imports and exports of different governmental bodies.20 This procedure includes controlled substances, biological products, hemoderivatives, medical devices, food products, medicines, cosmetics, personal hygiene products and sanitising products, among others.
Other import modalities encompass:
- express delivery, which is used for international orders transported by air, by courier company, which requires speed in the transfer and immediate receipt by the recipient;21
- international postal delivery, which is performed by the state company the Brazilian Postal and Telegraph Company;22
- international air parcel, which is a form of transport of goods and products by airlines, on demand, subject to sanitary control;23 and
- the non-electronic simplified import declaration, which is a document under the responsibility of the Federal Revenue.24
Companies may outsource the procedure through an importing company. Notwithstanding, outsourcing of the procedure does not exempt the marketing authorisation holder from its regulatory obligations, including those associated to the import.
The imports and exports of some products are subject to special restrictions. For example, some controlled substances are subject to an import authorisation and an export authorisation before the products' arrival or departure and the substances may only enter or leave Brazil through two ports and two airports, located in the states of São Paulo and Rio de Janeiro.25
Products destined for scientific research are also subject to special import and export rules. For example, products intended for scientific research that does not involve human beings as subjects may obtain an automatic approval of the import licence, provided that the scientific institution is accredited at the National Council for Scientific and Technological Development.26
xiii Controlled substances
Federal Law No. 11,343/2006 establishes the National System of Public Policies on Drugs. According to this law, drugs are narcotics, psychotropic substances, precursors, and others under special control of Ordinance No. 344/199827 of the Ministry of Health.
Ordinance No. 344/1998 defines the lists of controlled substances and the specific requirements for the performance of commercial activities involving those substances, including the obtaining of a special authorisation (AE). Activities such as manufacturing, distributing, transporting, packaging, importing and exporting controlled substances require an AE issued by the sanitary local authority, for each establishment.
Controlled substances are divided in lists according to the type of substance and the effects it may cause on human beings. For example, list A1 refers to narcotics, A2 refers to narcotics that are only allowed in special concentrations, lists A3 and B1 refer to psychotropic substances and list B2 to psychotropics substances that may cause anorexia. The lists go from A to F, subdivided in other categories.
The advertisement of controlled substances must be strictly directed towards healthcare professionals allowed to prescribe those substances, through journals with an exclusively technical content.28
Pharmacies and drugstores are subject to restrictions regarding the sale of controlled substances. The commercialisation of some substances is subject to a special control prescription that must be issued in two copies: one that must be kept by the patient and another that must be retained by the pharmacy or drugstore.29 Pharmacies and drugstores must establish a segregated system for storing controlled substances, such as a locker or a specific room.30
Enforcement actions encompass all products subject to sanitary surveillance, such as medicines, medical devices, food products, cosmetics, sanitising products, hygiene products, controlled substances, among others, as well as the activities involving such products, including advertising strategies.
These actions may be taken by the federal, state or municipal authorities, depending on the matter and the jurisdiction. Imports and exports are subject to federal surveillance.31
Establishments are subject to inspections from the local sanitary authorities of their jurisdiction (state or municipality). These inspections may happen on the company's request, as a requirement for obtaining a specific approval (a licence, for example), or as a regular exercise of enforcement actions by the authorities.
Ports, airports and borders also have federal agents responsible for the sanitary surveillance of imports and exports.
Members of industry associations regarding medicines and medical devices are subject to the association's code of conduct. In principle, the violation of such rules will subject the offender to the association's disciplinary proceeding, which is usually evaluated by an independent ethics committee.
Pricing and reimbursement
The Chamber for Drug Market Regulation (CMED) is the federal authority in charge of the economic regulation of the drug market, the definition of criteria for setting and adjusting the prices of medicines.32
To be commercialised in Brazil, a drug must have its maximum price approved by CMED. The marketing authorisation holder must submit a price information document for each new drug or new presentation.33
The companies are responsible for complying with the maximum prices approved by CMED. Non-compliance with CMED rules will subject the company to the administrative penalties of the Consumerist Code.34
In March 2021, ANVISA issued a Resolution regarding the economic monitoring of medical devices. Through this rule, ANVISA aims to contribute to the reduction of asymmetry of information in the market of medical devices, by providing the statistics of the historical prices of the products.35 The result of this monitoring may be used as a price benchmark for public or private purchases of medical devices.36
The public healthcare system is accessed by most of the population. Data from a national health research performed in 2019 by the Brazilian Institute of Geography and Statistics (IBGE) revealed that seven out of 10 Brazilians depend on SUS for treatments.37
The public health services are mainly regulated by Federal Law No. 8,080/1990. According to this regulation, health is a fundamental right of human beings, and the state must provide the indispensable conditions for the full exercise of this right.38 In addition, the principles of SUS determine the provision of comprehensive healthcare, and the universal access to health services.
This does not mean that Brazilians have unrestricted access to all treatments. To be incorporated into SUS, medicines and medical devices must be approved by the National Commission for the Incorporation of Technologies into SUS for a specific disease. The non-incorporated medicines and medical devices are commonly requested by patients from the state through the judicial system (which is usually addressed as the 'judicialisation of health').
The private healthcare system in Brazil is regulated by the National Supplementary Health Agency (ANS). ANS establishes the main rules for the operation of healthcare plans and monitors the activities of the operators.
The healthcare plans consist of a continuous provision of healthcare services, through an unlimited time, at the expense of the healthcare plan operator, through reimbursement or direct payment to the service provider, on behalf of the consumer.39 Healthcare plans must provide to the consumer the minimum services set forth in Federal Law No. 9,656/1998.
Administrative and judicial remedies
ANVISA's administrative procedure is regulated by Federal Laws No. 9,782/1999, No. 9,784/1999 and No. 6,437/1977, as well as by ANVISA Resolutions.
When a sanitary rule is violated, the competent authority issues an infraction notice against the company.40 The infraction notice initiates an administrative procedure, in which the company will have the right to present its defence before the authority's decision.
The penalties may vary according to the type of infraction, the economic capacity of the company, the existence of previous sanitary infractions from the same company, as well as attenuating and aggravating circumstances.41
In case of an unfavourable decision, the company will be able to choose between complying with the penalty or appealing to a second level of trial, which will be conducted by ANVISA's general management of appeals. The second level of trial is composed of a quorum of at least three participants and the trial sessions may be virtual or in person.42
The company may appeal to a third level of trial. The third level is composed by ANVISA's board of directors (DICOL). After DICOL's decision there are no further administrative measures to be taken to reform the decision.
The company may then resort to legal actions to review ANVISA's decision. Usually, the procedure begins with an action for annulment of an administrative act, which would be the infraction notice and all the acts resulting therefrom. The judiciary understands that 'it is not for the judiciary to analyse the administrative merit'.43 Thus, the judicial analysis is commonly limited to the legality of the administrative act.
Financial relationships with prescribers and payers
The financial relationship between prescribers and payors is not specifically regulated by any Federal Law in Brazil. If the prescriber belongs to a public health institution, then the anti-corruption44 and conflict of interest45 legislation will be applicable.
As a result of State Laws No. 22,440/2016 and No. 22,921/2018, in the State of Minas Gerais, companies must declare their relationships with healthcare professionals that may represent a conflict of interest, as well as sponsorships, funding of speakers, offering of gifts, among other economic interactions.
The Brazilian Code of Medical Ethics prohibits the exercise of medicine 'with interaction or dependence on a pharmacy, pharmaceutical industry, opticians or any organisation destined to the manufacture, manipulation, promotion or commercialisation of prescription products, whatever their nature'.46 Physicians that do not comply with the Code of Medical Ethics are subject to penalties that may vary from a simple warning to the exclusion from the professional council (in case of repeated conduct).
Industry associations of the pharmaceutical and medical devices sectors establish good practices in their codes of conduct regarding the relationships between companies and healthcare professionals. Companies that are not members of such industry associations may use those good practices as references for their conduct.
The good practices usually require that the interactions take place in proper locations, that the relationship is not conditioned to the prescription of products or other undue advantages, that due payments are made directly to the healthcare professional, or to the related organisation, through bank transfers (never in cash), according to a written agreement, and that all transactions are duly registered by the company.
Special liability or compensation systems
There are no special systems to compensate persons injured by medicines or medical devices. Thus, the route for compensation follows the general rules on compensation for damage as laid down in the Brazilian Civil Code.47
Compensation may be requested through individual lawsuits or by the Public Prosecutor's Office, by means of a public civil action.
Transactional and competition issues
Like many developing countries, Brazil effectively came to have enforcement on drug patents after the Agreement on World Trade Organization Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) in 1994–1995.
The Brazilian Industrial Property Law (Law No. 9,279/1996) was then created and inserted into Brazilian law several precepts of the TRIPS Agreement, including the 'absolute' patent protection principle (patent for all products, including drugs).
Even so, the country was a protagonist in transnational discussions involving access to medicines, including when the Doha Declaration on TRIPS and Public Health was elaborated in 2001. In 2007, the Brazilian government carried out the compulsory licensing of the drug efavirenz, used for AIDS treatment. Since then, there has been no more compulsory licensing of medicines in the country.
The pandemic brought changes to the Brazilian Industrial Property Law to determine that, in cases of national or international emergency or of public interest declared by the federal executive power or by the National Congress, a compulsory licence may be granted ex officio.
Nonetheless, Brazil has a solid and consistent patent system involving medicines. BPTO is responsible for receiving and accepting patent applications. The country has a strong industry of both reference drugs and generic drugs. Still, disputes involving patents are not uncommon, but are usually correctly settled by the Brazilian courts.
Voluntary licensing agreements between patent owners and generic producers are also possible. Among the recent changes to Brazilian Industrial Property Law, the possibility of a specific compulsory licensing of drugs for export to another country (that is, a country without production capacity), upon payment of royalties and compliance with specific conditions, was included in Brazilian law (in accordance with the recently added Article 31 bis of the TRIPS Agreement).
The additional possibilities and alternatives to patents through compulsory licensing, created during the pandemic, have not yet had a practical effect, especially because: (1) there is no provision for disclosure of trade secrets; and (2) there are still challenges in obtaining inputs for vaccine production worldwide.
i Competition law
Life sciences has been in the spotlight of a wide number of antitrust authorities around the globe in the recent times, including the Brazilian Antitrust Agency (CADE).
In the context of the covid-19 pandemic, for instance, CADE launched a preliminary probe into alleged abusive price increases on products related to the fight against the virus, alongside many other competition authorities that did so. As of December 2021, the probe is still ongoing, with the authority collecting information from market agents to assess whether there is any abusiveness in price alterations.
According to CADE, the goal of the investigation is not to control price or margins, but to confront potential abusiveness by the market agent during the shocks that the pandemic imposed on both demand and offer sides.
In 2021, for the first time, CADE launched an investigation to analyse the legitimacy in the exchange of information between the human resources departments of healthcare and pharmaceutical companies for the purposes of market intelligence.
According to the authority, pharmaceutical and healthcare companies would have regularly exchanged sensitive information through a group called MedTech about compensation and benefits offered to current and future employees. The launching of the investigation also follows a competition trend seen in other jurisdictions related to concerns with anticompetitive practices affecting labour dynamics, particularly in the health sector.
ii Transactional issues
Transactions involving healthcare and life sciences companies are common in Brazil, as they are all over the world. The pandemic has brought many opportunities for growth and investment in the sector.
The transactions can occur through different forms and structures. Transactional structures may include share deals, asset deals, demergers, drop downs, technology, and IP licensing, as well as other forms. The best option will depend essentially on the assessment and interpretation of the company's business model, combined with a thorough and combined assessment of the corporate, tax and regulatory aspects concerning the target company.
The first step in any transaction is usually to perform a due diligence focused especially on regulatory aspects, to verify the existence of essential requirements for the transaction, as well as the corresponding risks.
ANVISA has a specific regulation (ANVISA Resolution No. 102/2016) that determines the procedures involving the transfer of products' marketing authorisation arising from corporate or business transactions referring to drug, cosmetics, medical devices, tobacco and agrochemical products. The regulation also contains rules related to the update of permits and of GMP Certificates. ANVISA Resolution No. 102/2016 can be applied even if the transaction takes place outside Brazil.
In the context of a marketing authorisation transfer procedure, ANVISA Resolution No. 102/2016, in its Section 6, provides that the successor company assumes the rights and obligations of the transferring company, as of the execution of the commercial agreement, including the observance of terms and rules for compliance with health legislation and occasional restrictive measures on the circulation of products.
According to Section 30, Item III of Resolution ANVISA No. 102/2016, only a declaration indicating the execution of the agreement will be initially needed to be part of the marketing authorisation transfer dossiers. However, ANVISA can request the transaction agreement and additional clarifications on the transaction at any time.
In case the structure of the transaction contemplates that some activities may be outsourced, the main regulation concerning outsourcing of medicines in Brazil is ANVISA Resolution No. 234/2018. The outsourced company must possess the corresponding licences and permits to operate.
The current regulation determines that, while the marketing authorisation holder may outsource product manufacturing, product quality control and product storage, it cannot outsource activities related to 'control in process' in a way that is dissociated from the production.
Brazil also has specific legislation and encourages technology transfers. In the health area, there are Productive Development Partnerships (PDPs), as determined by the Ministry of Health Ordinance No. 2,531/2014. PDPs are partnerships between public and private organisations with the goal of internalising the production and development of a health technology in Brazil. The transferor is assured that the final product with that technology will be acquired by the Brazilian government for a certain period of time; that is, while the technology is still not yet transferred.
Telemedicine has been regulated by the Federal Council of Medicine (CFM) since 2002. In 2018, CFM issued a new Resolution on telemedicine, which was revoked in 2019. Since then, CFM has not regulated the matter again, which has raised legal uncertainty regarding some companies' business models, such as healthtechs.
In 2020, as a result of the covid-19 pandemic, telemedicine has been exceptionally authorised by a temporary Federal Law.48 This law establishes that once the covid-19 crisis is over, the competence for regulating telemedicine will return to CFM. Ever since, the National Congress has been discussing a Bill of Law to authorise telemedicine on a regular basis. In parallel, CFM has been discussing a new Resolution to regulate telemedicine, which will likely address topics such as the need for the first consultation being physical, the modalities of telemedicine, and the need for capacitation of physicians to provide telemedicine services.
The outcome of this Bill of Law and the new CFM Resolution is expected to impact the business models of many companies in Brazil that began their telemedicine operations during the pandemic.
The regulation of the commercialisation of medicines by remote means49 is also under discussion.
In Brazil, only a few establishments are authorised to commercialise medicines: pharmacies, drugstores, drug dispensaries, drug stations and mobile units. These establishments, mainly drugstores and pharmacies, are subject to specific rules regarding the display of medicines on the physical space, the advertisement, the dispensation and the delivery of medicines.
With the entry of new technologies on the market, such as intermediation platforms, marketplaces, and social networks, the rules for the advertising and marketing of medicines have become obsolete. The need for an update became evident during the covid-19 pandemic, as a result of the important role of these new players to provide access to pharmaceutical assistance to people following the social isolation guidelines.
The new Resolution under discussion by ANVISA is expected to adjust the rules on the remote sale of medicines to the current scenario, to regulate the new players on this market such as marketplaces and other applications.
1 Marco Aurélio Antas Torronteguy and Guilherme Ribas are partners and Victor Hugo Callejon Avallone is a senior associate at TozziniFreire Advogados.
2 Federal Constitution, Section 196.
3 Federal Constitution, Section 200, Item II.
4 Federal Constitution, Section 200, Item I.
5 Federal Law No. 9,782/1999, Section 6.
6 Resolution ANVISA No. 9/2015, Section 6, Item IV.
7 Resolution CNS No. 563/2017 defines as 'ultra-rare disease' the 'chronic, debilitating, or life-threatening disease, with an incidence lower than or equal to 1 (one) case for every 50,000 (fifty thousand) inhabitants' (Section 2).
8 Resolution ANVISA No. 38/2013, Section 2, Item X.
9 Resolution ANVISA No. 38/2013, Section 2, Item VIII.
10 Resolution ANVISA No. 266/2006, Annex I.
11 Resolution ANVISA No. 204/2017, Section 3, Item V.
12 Currently, this policy corresponds to Annex XXXIII of the Ministry of Health's Consolidation Ordinance No. 2/2017.
13 Resolution ANVISA No. 406/2020.
14 Resolution ANVISA No. 67/2009, Section 2.
15 Resolution ANVISA No. 102/2016.
16 Resolution ANVISA No. 497/2021.
17 Federal Law No. 6,360/1976, Section 59.
18 Resolution ANVISA No. 98/2016, Section 3, Item I.
19 Resolution ANVISA No. 185/2001, Annex II.
20 Created by Federal Decree No. 8,229/2014.
21 Resolution ANVISA No. 81/2008, Annex, Section 1.54.
22 Resolution ANVISA No. 81/2008, Annex, Section 1.53.
23 Resolution ANVISA No. 81/2008, Annex, Section 1.21.
24 Resolution ANVISA No. 81/2008, Annex, Section 21.
25 Resolution ANVISA No. 367/2020, Annex I.
26 Resolution ANVISA No. 172/2017, Section 2.
27 Federal Law No. 11,343/2006, Section 66.
28 Resolution ANVISA No. 96/2008, Section 32.
29 Ordinance No. 344/1998, Section 52.
30 Resolution ANVISA No. 44/2009, Section 37.
31 Federal Law No. 6,360/1976, Section 69, Item I.
32 Federal Law No. 10,742/2003, Section 6, Items I and II.
33 Federal Law No. 10,742/2003, Section 7.
34 Federal Law No. 10,742/2003, Section 8, and Federal Law No. 8,078/1990, Section 56.
35 Resolution ANVISA No. 478/2021, Section 4, Item I.
36 Resolution ANVISA No. 478/2021, Section 8.
37 IBGE (Brazilian Institute of Geography and Statistics) News Agency, 4 September 2020, PNS 2019: 'Seven out of ten people seeking the same health service go to the public network'. Available from: https://agenciadenoticias.ibge.gov.br/agencia-sala-de-imprensa/2013-agencia-de-noticias/releases/28793-pns-2019-sete-em-cada-dez-pessoas-que-procuram-o-mesmo-servico-de-saude-vao-a-rede-publica (accessed on 30 November 2021).
38 Federal Law No. 8.080/1990, Section 2.
39 Federal Law No. 9,656/1998, Section 1, Item I.
40 Federal Law No. 6,437/1977, Section 12.
41 Federal Law No. 6,437/1977, Section 2, Paragraph 3, and Section 6.
42 Resolution ANVISA No. 266/2019, Section 20.
43 Federal Court of Appeals of the 3rd Region, 10 September 2020, Civil Appeal No. 0011851-30.2012.4.03.6100. Available from: http://web.trf3.jus.br/acordaos/Acordao/BuscarDocumentoPje/141383404 (accessed on 30 November 2021).
44 Federal Law No. 12,846/2013.
45 Federal Law No. 12,813/2013.
46 Resolution CFM No. 2,217/2018, Section 68.
47 Federal Law No. 10,406/2002.
48 Federal Law No. 13,989/2020.
49 Resolution ANVISA No. 44/2009.