Current barriers to biotech in Brazil – IP & Life Sciences

Gabriel Di Blasi outlines the existing impediments to developing new biotechnology products in Brazil, and considers recent efforts to improve the situation.

The Brazilian government intends to improve regulation for patents, especially in the biotechnology sector. Last March, the Brazilian Minister of Development, Industry and Foreign Trade announced measures to improve the Brazilian regulations related to patents, especially in the field of biotechnology, mainly with regard to changing the rules of IP law and permits for research in biotech.

The ultimate purpose of these changes is to enhance opportunities for researchers and investors in biotech, providing full access to Brazilian genetic resources, as well as the development of related inventions, but the current legislation presents several bureaucratic hurdles that may hamper the development of the patent process.

Currently, the regulating laws of this matter are: i) Industrial Property Law No. 9,279 of 1996; ii) Provisional Measure No. 2,186-16 of 2001, which regulates access to the Brazilian genetic heritage; and iii) Resolution No. 69 of 2013 of the Brazilian patent and trademark office (INPI), which deals with patents derived from the genetic heritage.

Provisional Measure No. 2,186-16, which focuses on protecting biodiversity against bio-piracy, was enacted at the beginning of the last decade, because the number of cases related to the use of Brazil’s natural resources without control had increased considerably.

According to the Provisional Measure, in order to collect, access and, if necessary, send abroad any Brazilian genetic resource, the user must obtain the necessary authorisations from the relevant Brazilian entities, such as the Genetic Heritage Management Council (CGEN) and the Brazilian Institute for the Environment and Renewable Natural Resources (IBAMA). It means that almost any manipulation requires public authorisation.

As stated in this Provisional Measure, genetic resource means any genetic information contained in samples of the whole or part of a plant, fungal, microbial or animal specimen, in the form of molecules and substances of the metabolism of these living beings and of extracts obtained from these living or dead organisms, found in situ conditions, including domesticated or kept in ex situcollections, provided they were collected within the Brazilian national territory, on the continental shelf or in the exclusive economic zone.

In addition, the Provisional Measure regulates access to genetic resources, the obtaining of genetic component samples for scientific research, technological development and bio-prospecting purposes, with the ultimate aim of industrial application.

In order for a company to use a Brazilian genetic resource for the development of a product, several steps have to be followed. First, it is necessary to obtain, through a corresponding research institution, an authorisation to collect samples at the IBAMA through the system of authorisation and information on biodiversity (SISBIO). This system is responsible for providing users with authorisation to collect biological material within the Brazilian territory.

After overcoming this step at SISBIO, the user has to request authorisation for access to genetic resources before the CGEN. Also, with regard to scientific research, it will be necessary to deposit a sample with the accredited depositary authority. It is worth mentioning that foreign companies cannot directly carry out this research. In other words, it is necessary to be associated with a CGEN-accredited entity such as a Brazilian university or company, through formal agreements for this purpose.

Further authorisations are necessary, such as permission from the Brazilian communities (indigenous, native-born or the owner of the area), if the genetic resource is to be collected or accessed at this place.

However, in the event that any commercial component in the research arises, besides the request for authorisation to access the genetic resource, it will be necessary to execute several documents, such as an agreement for benefitsharing resulting from the sale of the products with the community or owner of the area where the material will be accessed. Also, there is the need to execute a statement of material transfer and the deposit of the sample, obtained at an entity accredited by the CGEN.

All these procedures can take nearly three years, and only after fulfilling all of them can the company or university carry out the research and development of the genetic resource.

In parallel, regarding the effects on patent applications related to products or processes derived from a genetic resource, such applications must demonstrate the corresponding authorisations, otherwise the INPI cannot examine the patent application, leading to its shelving.

According to Article 31 of Provisional Measure No. 2,186-16, duly regulated by INPI Resolution No. 69 of 2013, the applicant for a patent the object of which has been obtained as a result of access to samples of components of genetic heritage, as of June 30, 2000, must inform the INPI of the origin of the genetic material and the corresponding access authorisation.

Nevertheless, in view of the bureaucratic burden, most genetic resources used in patent applications in this technological field have not been authorised by CGEN or IBAMA. Thus, in view of the lack of authorisation, the vast majority of patent applications are going to be shelved.

Finally, companies that use a genetic resource in their products or technologies without holding the authorisation to collect or access it or not receiving the authorisation in due time, are subject to large fines from the Brazilian government, which is ultimately inhibiting and preventing the development of the biotech sector in Brazil.

Provisional Measure No. 2,186-16 has not only raised a number of obstacles preventing universities, researchers and companies accessing genetic resources for research and development, but has also prevented new domestic and foreign investments in biotechnology in Brazil.

Therefore, considering that Brazil is one of the countries with the greatest natural resources for research and bio-prospecting, there is a need to change the current rules and procedures related to obtaining authorisation for the collection of and access to genetic resources in order to develop new biological products, and to share benefit from such access.

In order to change this scenario, and since Brazil is becoming more attractive for domestic and foreign investment in the biotechnology field, the Brazilian Ministry of the Environment along with other players in Brazilian industry, including pharmaceutical companies, research entities and associations of industries, is engaged and committed to “Companies that use a genetic resource in their products or technologies without holding the authorisation to collect or access it or not receiving the authorisation in due time, are subject to large fines from the Brazilian government, which is ultimately inhibiting and preventing the development of the biotech sector in Brazil.” elaborate a bill for the collection and access to Brazilian genetic resources.

Recent reform

The idea is to review legal and technical concepts, simplifying the procedure to apply for an authorisation to collect and access genetic resources, as well as material transfer and depositing a sample, giving the opportunity to regularise pending authorisations for collection and access, including cases related to patent applications, to expedite the examination of the authorisation by CGEN, and bring more transparency to the benefit-sharing rules.

The new legislation intends to reduce bureaucracy and the time taken to grant authorisations for collecting and having access to the genetic resource. Moreover, it will improve the landscape of biotech in Brazil, promoting the use of genetic resources for the benefit of several sectors, including biofuel, feed in general, and drugs.

Gabriel Di Blasi is a senior partner of Di Blasi, Parente & Associados. He can be contacted at: gabriel.diblasi@diblasi.com.br