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Bill no. 29/06: finally, the proposal for Brazilian "linkage"

Bruno Falcone

On February 6, 2006, legislative protocol for Bill no. 29 was carried out at the initiative of Senator Ney Suassuna, who intends to add subparagraph VIII of Law No. 6.360/76 to Article 16. This conditions the granting of sanitary registration for pharmaceutical products for human use upon evidence that the petitioner owns the patent or is licensed to economically exploit its object.

Following its presentation, the Bill was sent to the Committee on Social Matters, and Senator Augusto Botelho was named reporter (former reporter Senator Flexa Ribeiro was in favor of the Bill's approval). There were no amendments. If approved, it will establish in Brazil's regulatory system the "linkage" (as it is internationally known) between a patent right and the health authority's marketing approval and registration of the resulting products for sale.

The wording "if the main active ingredient or the drug [read: pharmaceutical formula] to be licensed is the object of a patent that is in effect" may have missed a good opportunity to expressly contemplate the protection granted under patents containing process claims - as the legislator's apparently unequal treatment is unwarranted -, but otherwise the Bill at issue represents a considerable advance in Brazil's industrial property protection mechanisms.

Note the only exception, in theory, to a patent's right to exclusivity under Industrial Property Law Article 43, Subparagraph VII, acts strictly for the production of test data and results, with the aim of obtaining marketing approval for sale in Brazil or abroad in order to exploit the protected product subsequent to the respective patent's expiry date. However, neither the granting nor the application for such registration is permitted.

Currently, despite the legal and constitutional protection guaranteed invention patent owners, it is not unusual for sanitary registration for the so-called "similar "drugs (branded generic drugs) to be granted to third parties who are not authorized while the respective patent is totally enforceable.

Although the legal concept of a "similar" drug, as established in Law No. 6,360/76, Article 3, Subparagraph XX, unlike the case of generic drugs, does not explicitly address patent protection or other exclusivity rights, it appears that marketing approval, even in the health aspect only, to sell infringing products constitutes a true disservice and violates a series of principals on which government administration is founded.

As such, if the Federal Constitution and Industrial Property Law guarantee a patent owner the right to exploit economically, with exclusivity, its object - "considering the Country's social interests and economic development," - then granting marketing approval for a product that infringes a valid and enforceable patent is contra legem and violates public interest.

Moreover, the disservice is explained by the fact that - through an illegal act by the public health authority whereby it grants marketing approval to an unauthorized third party for a product in breach of a valid patent - the patent owner must resort to the already overloaded Judicial System, occasioning complex, unnecessary litigation at high costs to the parties involved, as well as to society as a whole., and this is inconsistent with the general principle that the Public Administration must act in as efficient a manner as possible.

It is also unconvincing to assert that the National Health Surveillance Agency (ANVISA) is a federal entity whose only objective is to protect public health, so that it may not interfere in industrial property matters. If that were the case, it would have to abstain from (re) analyzing patentability requirements for patent applications for pharmaceutical products and processes sent to it under Article 229-C of the Industrial Property Law.

This legislative initiative is thus beneficial, as it adapts Brazil to international standards for industrial property protection, like in the United States and Canada, for example.

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