ANVISA – Brazil’s National Health Surveillance Agency – has taken a significant step in strengthening its regulatory framework.

In promulgating RDC No. 153/2017, it is reducing the amount of regulatory red tape in the licensing of companies subject to health surveillance.

The strategic goal of this ANVISA resolution is to rationalize, simplify and harmonize procedures and requirements related to health surveillance licensing. RDC No. 153/2017 brings an interesting legislative approach to the technical regulation of the subject matter by establishing degrees of risk in business development in the life sciences and health sectors in Brazil. This further strengthens standardized procedures for licensing-related safety.

The resolution creates new regulatory classifications: “high health risk” and “low health risk.” The level of requirements to be met in any particular instance is linked to the kind of business that will be effectively established in the domestic market. In some cases, differentiating between high and low-risk classes will require the stakeholders to provide additional clarifications.

Under RDC No. 153/2017, issued in April, projects that present a high health risk are those that still require safety inspection and / or documentary analysis as a sine qua non condition for issuing the license. Low-risk ventures are exempt from safety  inspection and / or documentary analysis prior to the commencement of operations. (where appropriate, safety inspection and / or documentary analysis should occur only after the license is granted).

The national standardization tool of Brazil’s economic activities code (CNAE) will be the key index to measure risks undertaken by players in the life sciences sector.

To that end, in April ANVISA also issued Normative Instruction No. 16/2017, with annexes listing CNAE spread among high-risk and low-risk ventures, in addition to pointing out those that rely on additional information for classification.

Pharmaceutical companies and manufacturers and wholesalers of medical devices are of course still subject to strict licensing proceedings before the health surveillance agencies, because they are still high-risk initiatives under RDC No. 153/2017. However, both the retail trade of medical devices and wholesaling of food and beverages have now been defined as a low-risk activity; those, those involved in those areas may enjoy the advantages of this new resolution.

This list of CNAE codes  is subject to review whenever necessary to meet any health-specific circumstance. It is undeniable, nonetheless, that the CNAE code of the company will dictate the rules of its licensing; companies therefore should take great care determining the proper coding.

That is, RDC No. 153/2017 is pushing a shift in the business strategy priorities for life sciences and health companies in Brazil. In the past, the regulatory position of a company’s activities was always verified before its CNAE was defined. With RDC no. 153/2017, however, determining this classification shall be stressed ab initio, in order to get a more accurate and less difficult framework as an economic indicator of the company’s scope. As many observers are pointing out, companies will need to address this change when defining their strategies relating to business development in Brazil.

Furthermore, health surveillance authorities at the state, district and local levels may themselves complement the terms of RDC No. 153/2017, provided they are in compliance with federal regulations as well. Such broad discretion aims to overcome the obstacles created by the existence of varied organizational structures in some regions, such as São Paulo.

Despite its advances, however, the RDC does not address certain issues that are important to private entities, especially as regards the predictability of the implementation of the new procedures, either in the technical-operational context (e.g. availability of electronic petitions in all health surveillance agencies) or in the surveillance sphere (e.g. traceability and assessment of health risks).

Clearly, as some observers have noted, this RDC is not particularly innovative. For instance, the scenario of risk grading now defined at the federal level is already used by some Brazilian states, such as São Paulo and Rio de Janeiro. But the RDC nevertheless puts in place federal rules that help ANVISA’s regulatory framework to meet the needs of today’s globalized market, and thus it contributes to making Brazil a preferred gateway for investors seeking to do business in Latin America.

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