Life Sciences and Healthcare: an overview of 2021 and the outlook for 2022
Topics on the health sector's agenda include Covid-19, digital health and vertically integrating health services
After almost two years of living through the Covid-19 pandemic, the many changes society has undergone are undeniable. In the health sector, the 21st century’s first pandemic has caused a range of structural changes, including in research, product development, patient care, rehabilitation, as well as new forms of prevention, diagnosis and treatment.
The issue of public health has become increasingly prominent in conversations among the general public and those outside the health sector, appearing on a daily basis all across the media both in Brazil and worldwide. In Brazil, terms such as ‘clinical research’, ‘Anvisa’ (Brazil’s health regulator) and ‘vaccine’ have become part of the population’s everyday vocabulary, who continue to follow the latest developments in the race for vaccination.
Although 2021 saw significant scientific advances and an apparent slowdown in infections in light of increased vaccination and the approval of specific drugs to control the virus, the reality for professionals in the health sector was much bleaker. Rising death rates and shortages of ICU beds, oxygen cylinders, anesthetics and muscle relaxants, as well as a testing strategy that never truly got off the ground, were among the issues that made it a very complicated year.
On the other hand, the pandemic has also opened up space to discuss important issues that had not been given the attention they required, leading to overdue and welcome changes. Efforts to reduce red tape in the health sector and the use of new technology in recent times are expected to permanently remain on the regulatory authorities’ agendas, facilitating innovation in measures to protect individual and collective health.
In Brazil, this period has also been marked by a significant and rarely seen increase in clinical trials, engaging 94 institutions and nearly 200,000 participants in Covid-19 research. This has reinforced the need to invest further in research and development and strengthen Brazil’s industrial health complex, which should contribute to the country’s economic recovery in the long term.
Health is expected to remain on the main agendas of Brazilian authorities in 2022, including in the Legislative, Executive and Judicial Branches. Topics that should remain (or be included) in the health sector’s agenda are outlined below:
The federal government’s decreed public health emergency is expected to remain in effect during 2022. This will continue to require the allocation of a wide range of resources to fight the Covid-19 pandemic, such as testing initiatives, vaccine distribution, access to medicine and medical supplies for treatment, as well as structural reinforcement in regard to hospital beds and ICU wards.
From a control standpoint, an increase in government inspections and investigations into fraud and other illegal activity linked to the response to Covid-19 is expected to occur. These actions were already underway in 2021 and should continue to remain on the authorities’ agenda.
The government’s decree of a public health emergency also inspired Law No. 13,989/2020 and the Ministry of Health’s Ordinance No. 467/2020, both of which specifically authorize telemedicine services for attending patients, research, disease and injury prevention, and promoting health. However, these regulations only authorize telemedicine during the pandemic period.
Federal nursing, dentistry, physiotherapy and nutrition councils have also established regulations to allow health professionals to use digital tools during the pandemic.
These tools are used for services including pre-clinical care, attending patients, consultations, monitoring and diagnosis, whether in the scope of Brazil’s Unified Health System (SUS), supplementary health or private health systems.
With the hope that the Covid-19 public emergency period will soon come to an end, the National Congress is expected to approve a law definitively regulating the issue. This would give the health technology sector greater security and expand access to medical services after the emergency period ends.
Wide-scale use of telemedicine should also drive:
- A move toward digital prescriptions, a topic that still awaits definition and regulation from Anvisa. At this stage, a public consultation has been published, though it has yet to result in any formal regulations;
- Point-of-Care Testing (PoCT) initiatives, which regard any type of diagnostic testing conducted remotely, inside or outside of hospitals or laboratories. This issue has also been subject to a public consultation process, which proposed new technical requirements for carrying out Clinical Analysis Tests (TACs) when providing Diagnostic and Therapeutic Support Services (SADT);
- The use of Software as a Medical Device (SaMD), which Anvisa defines as any system with medical, dental or laboratory use applications for prevention, diagnosis, treatment, rehabilitation and contraception purposes.
Aware of patients and health professionals’ increasing use of software and applications for the purposes above, Anvisa has prepared a Regulatory Impact Analysis (AIR). It is also currently in discussions about creating specific standards for SaMD, and already opened a public consultation for regulating these devices.
The pandemic’s quarantine measures, social distancing and restrictions on movement have seen a surge in e-commerce for regulated products and services, and as such, this business model has become increasingly present in the consumer experience.
Although there has been a regulatory framework specifically for online sales of medicines since 2009, this is limited to licensed pharmacies and drugstores with physical stores, which must always have a qualified pharmacist present during opening hours.
With the pandemic, there has been increasing interest from online marketplaces to offer these products, currently only available in pharmacies and drugstores. Anvisa has been involved in inspecting and evaluating the online marketplaces, which have called for it to deal with the issue openly and transparently through establishing new regulations. These marketplaces argue that they would be able to expand access to medicine and increase competition among vendors, thus generating benefits for consumers.
Recognizing the need to update current regulations, Anvisa held an event in August 2021 to discuss the issue. In turn, the federal government is also analyzing a potential provisional measure to allow supermarkets to sell low-risk pharmaceutical drugs.
In the area of clinical trials, Bill No. 7,082/2017 is currently being processed in Brazil’s House of Representatives, having already been approved in the Senate. It proposes a series of changes to facilitate certain processes inherent to clinical research, such as ending double approval measures regarding medical ethics, as well as criteria that obligate treatments for participants once clinical studies have finished.
Vertical integration of healthcare services and new remuneration models
Six years after legislative changes permitted foreign investments in Brazilian healthcare services, the market continues to offer opportunities for mergers and acquisitions for companies of all sizes.
Diagnoses and treatments for cancer, diabetes, depression, heart disease and elective surgeries that have been postponed or neglected during the pandemic are likely to overwhelm the public and private health sectors in the coming months, which should further stimulate vertical integration efforts and new remuneration models in the health sector, with impacts for the medication and health product industries as well.
This scenario should also favor discussions on new Risk Sharing Agreements (ACRs), used by payers (for example, the Ministry of Health) and manufacturers to manage risks linked to pharmaceutical product use. ACRs can be used to set a variable price in line with the results of financial or clinical outcomes, or otherwise to define management metrics between the parties involved.
Considering the price of medicines is trending upward – whether because of increased demand or their innovative nature – establishing ACRs can provide companies with a financially sustainable alternative for purchasing and selling these products, given there is a need for continued studies and follow-ups with patients to evaluate the performance of the product in the real world.
In the absence of express provisions concerning negotiating ACRs with public entities, Bill No. 667/2021 deserves attention. By aiming to amend Law No. 8,080/1990, it would provide for ACRs as a tool for incorporating new technology into the SUS.
For further information, please contact Mattos Filho’s Life Sciences & Healthcare practice area.