After some months of discussions between the public and the private sector, on November 12, 2014 the Ministry of Health enacted Ordinance No. 2,531, which has redefined the rules for the establishment of Productive Development Partnerships (Parcerias de Desenvolvimento Produtivo - "PDPs") in Brazil.
The abovementioned Ordinance derives from a public consultation opened on August 13, 2014 by the Ministry of Health, aiming at structuring a new legal framework for PDPs, thus replacing Ordinance No. 837 enacted in 2012. Based on the results and contributions of the public consultation, Ordinance No. 2,531 sets new guidelines and criteria for the implementation of PDPs, including proceedings for the submission, review and selection of proposals of PDPs by the Brazilian Government and directions for the transfer of technology and purchase of strategic products in the context of the PDPs implementation.
In comparison with Ordinance No. 837, Ordinance No. 2,531 may be considered as a much more detailed regulation, providing the complete proceeding for PDPs? approval by the Ministry of Health and their subsequent implementation by the parties. In this regard, please find below a brief summary of some of the most important aspects introduced by Ordinance No. 2,531:
- Proposal of PDPs
All proposals for PDPs must be presented by the public partner(s) to the Ministry of Health, specifically to the Ministry?s Secretariat of Science, Technology and Strategic Goods, between January 1st and April 30th of each year. The proposal must follow the format of executive project made available by the Ministry of Health, which includes information about the parties and the product, the intended timeline for the project and the investments required. The decision in respect of the projects submitted will be published following the meetings of the Executive Group for the Health Industrial Complex ("GECIS"), by the end of each year. Ordinance No. 2,531 also sets forth the criteria for the selection of projects, including specific factors to be considered in the event the number of proposals presented for the same product is higher than the demand of the Ministry of Health.
- Term of the PDPs
According to Ordinance No. 2,531, the term of the PDPs shall not exceed 10 years. Since Ordinance No. 837 established a term of 5 years, some entities may see the new rule as progress. However, the previous regulation allowed for a longer term if the period required for the technological development was notably longer and the PDP resulted in the nationalization of a highly important product to Brazil.
- Technology Transfer to Brazil
One of the main objectives of the PDPs is the transfer of the manufacturing technology to a Brazilian public institution. Ordinance No. 2,531 sets forth specific requirements in this regard, such as that the public institution shall have access to the drug master file and/or the master cell bank related to the product subject of the PDP.
- Supply of Products
In order to ensure that the Brazilian public institution will receive all the technology and support required to manufacture the product subject of the PDP, according to Ordinance No. 2,531, the Ministry of Health will acquire finished products from the private entities based on the development stage of the PDP?s project, including the product registration with the Brazilian National Health Surveillance Agency. For instance, the first acquisition of products by the Ministry of Health will only occur upon proof by the public institution of the beginning of the technology transfer by the private partner.
Ordinance No. 2,531 and the new regulation for the PDPs entered into force on November 13, 2014. The PDPs already in place, created under Ordinance No. 837, shall be adapted to these new rules within 180 days as from November 13, 2014.