After 15 years, the feds have finally decided to unlock the system.
In order to address certain amendments and add-ons to Law No. 9,276/96, the so-called Intellectual Property Law, in 2001 Brazil’s National Congress promulgated Federal Law No. 10,196.
Despite appointing several technical and procedural parameters related to the National Industrial Property Institute (INPI), this law also brought an interesting – and controversial – legislative approach to the economic regulation of the pharmaceutical market, since it bonded the concession of patens in this sector to “prior consent” from the National Health Surveillance Agency (ANVISA”).
The law did not answer two key questions: “What is an “ANVISA’s prior consent?” and “Which parameters and procedures should be used for granting an ANVISA’s prior consent?” This set up what can only be described as the battle of the feds – a conflict between ANVISA and INPI over registration of pharmaceutical product patents.
At the beginning of the battle of the feds, INPI took the position that “under no circumstance” could ANVISA assess and/or review patentability requirements, since it is not a competent governmental body regarding those requirements. On the other hand, ANVISA has affirmed that the scrutiny of the subject matter for granting of “prior consent” would include reassessment of patentability requirements, in addition to other factors established by current health legislation.
By mid-2008, the regulatory controversy over the subject matter was well established; since then, numerous jurisdictional conflicts have been argued before the agencies involved, and several lawsuits have been filed arguing that ANVISA’s position corrupted the system structured in Brazil by the Intellectual Property Law.
Now, after 15 years of interagency conflict, the casualties of the battle have mounted: 30,000 patent applications are pending for analysis, and the ramifications of the conflict, in terms of intangible liability, are even greater.
Delay in granting a patent automatically extends the start of the protection countdown. As an example, generic medicines do not enter the market as quickly as the already established pharmaceuticals; thus, access to the generic pharmaceutical product becomes more expensive. Moreover, although many patent applications have not yet been evaluated, pharmaceutical companies act as if their products are already protected, raising their prices and further discouraging other companies in the industry from developing similar formulas.
From a practical standpoint, this has created the same circumstance that occur in other countries under “pay for delay,” but without the benefits for manufacturers of generic drugs and SUS. Worse, this “patent extension” situation has resulted in losses of BRL2 billion to SUS so far.
Note that the practice of “pay for delay” is not even allowed in Brazil.
Both the healthcare and industrial property sectors have suffered the consequences of this long-term conflict – but it appears that the battle will soon draw to a close.
On April 12, 2017, INPI and ANVISA announced that they have agreed on parameters and procedures that will be used to analyze patent applications for pharmaceutical products and their proceedings. They have signed a Joint Ordinance on this matter that will be published in the coming days.
The agencies have also agreed that the regulatory bodies will establish an Inter-institutional Commission, in which representatives from both agencies will participate, with the objective of promoting the exchange of technical information and the harmonization of processes. Their goal: to end the ongoing battle over subject matter.
The regulatory model encourages the technical discretion of the regulators, besides making it clear that prior consent does not authorize, in the performance of tasks of ANVISA, the assessment of aspects unrelated to public health. The patentability requirements, in turn, remain fully established as INPI’s own competence. That is, ANVISA will certainly play an important role during the analysis of the patentability of a pharmaceutical product, but when it comes to registration, INPI will have the final word.
The applicant will therefore be responsible for filing a patent application in accordance with the conditions established by INPI, but without contradicting ANVISA’s economic and political aspirations in the field of public health.
One day soon, for the pharmaceutical sector, the battles of the feds will be in the past.
Please do not hesitate to contact the authors at Campos Mello Advogados, an independent law firm in Brazil
for further information at terence.trennpohl@cmalaw.com, paula.menabarreto@cmalaw.com, or bruna.rocha@cmalaw.com.
Terence Trennepohl, Partner in Campos Mello Advogados’ Life Sciences practice
Paula Mena Barreto, Partner in Campos Mello Advogados’ Intellectual Property practice
Bruna Rocha, Associate in Campos Mello Advogados’ Life Sciences practice
