Product development partnerships
On January 27 2017 the Ministry of Health released a list of 52 strategic products for the National Unified Health System (SUS) which are currently imported and which it believes should be manufactured by the national pharmaceutical industry. As all of the selected products are manufactured abroad, the Ministry of Health is seeking to encourage the transfer of the manufacturing involved in the industrialisation of these products to Brazilian public and private pharmaceutical companies in order to:
- reduce purchase costs and therefore SUS expenses;
- create more jobs in the sector; and
- boost investments in the national pharmaceutical industry.
The release of this list is meant as a call for Brazilian public and private laboratories to participate in product development partnership promoted by the Ministry of Health in order to increase national manufacturing of medications, raw materials and chemical syntheses and reduce Brazil's dependence on foreign products.
In addition to improving SUS's ability to provide assistance, the national manufacturing of the listed products would directly affect the Ministry of Health's budget. Although the 52 products represent only 4% of the total biological products distributed by SUS, these products exhaust 51% of SUS's resources allocated for the purchase of medications.
Among the products listed are the two most expensive medications imported by the federal government: sofosbuvir, used for the treatment of hepatitis C, and eculizumabe, used for renal insufficiency. Both of these medications are produced in and imported from the United States. Further, both medications are imported under judicial request – a process which requires patients to appeal to the judiciary and request that the government provide them with such medications by using the resources allocated to SUS. Together, both medications exhaust approximately R$1 billion of the Ministry of Health's annual budget. In addition, the list contains the drug dolutegravir, which was recently offered through SUS and is considered the most modern chemical syntheses for HIV/AIDS treatment, and everolino, which is recommended for transplant patients.
Product development partnerships
With the publication of the list of strategic products, public and private Brazilian labs will be able to establish Ministry of Health-promoted partnership projects with the US corporations responsible for industrialising the aforementioned medications in order to transfer the technology and ultimately begin manufacturing these medications locally.
According to Health Minister Ricardo Barros, the establishment of product development partnerships is expected to stop foreign labs from selling products to SUS on a retail basis and will instead encourage wholesale sales. This will make it possible to enhance price negotiations without a bidding process, thus increasing SUS's supply and preventing judicial requests. Further, Barros has emphasised that product development partnerships, up to the completion of manufacturing the biological products in Brazil, will be based on what is agreed in the contract proposed by each lab and its respective production and structure capacities.
The Ministry of Health considered the following when preparing the list:
- neglected products;
- high technology;
- high cost medications; and
- products with the highest number of judicial requests.
The platforms linked to the federal government's Programme for the Development of Industrial Health Complex were also considered, including:
- rare diseases;
- neglected diseases;
- health products;
- blood products;
- nuclear medicine; and
- chemical syntheses.
The project must be concluded within 10 years, which means that the technology transfer must be finalised within this period.
In addition to the list of strategic products eligible for the transference of technology, the Ministry of Health also published a list of existing partnerships which have commenced a product development partnership project and product development partnerships which are ineligible to present a proposal for a new projects.
For further information on this topic please contact Elysangela de Oliveira Rabelo at TozziniFreire Advogados by telephone (+55 11 50 86 50 00) or email ([email protected]). The TozziniFreire Advogados website can be accessed at www.tozzinifreire.com.br.