Life Sciences: looking back on 2022 and projections for 2023
Telehealth, new remuneration models and labeling and packaging regulations are among some of the key themes from 2022 that should continue to impact the sector in 2023
2022 was marked by the emergence of a ‘new normal’ as much of the world overcame the worst of Covid-19, the 21st century’s first global pandemic, with our society still undergoing various structural changes due to the virus. Although Covid-19 continues to pose a threat to public health, important scientific breakthroughs in the last year have led to a reduction in infections and the end of the public health state of emergency both in Brazil and other parts of the world. This situation is largely the result of global mass vaccination efforts, increased testing capacity and the approval of specific drugs to control the disease.
In Brazil, the pandemic has spurred the consolidation of important regulatory practices. One example concerns the adoption of specific technical regulations for regulatory reliance, broadly defined as the use of an optimized procedure for approving analyses or documentation issued by an Equivalent Foreign Regulatory Authority (AREE).
The Brazilian Health Regulatory Agency’s (Anvisa) Resolution No. 741/2022 defines AREEs as foreign regulatory authorities or entities that it recognizes as having achieved regulatory reliance, ensuring that products authorized for distribution have been properly evaluated and meet recognized quality, safety, and efficacy standards.
In practical terms, Anvisa can now automatically take AREEs’ assessments into account, thus speeding up regularization processes at the national level. However, for foreign entities to qualify as AREEs, Anvisa’s collegiate board must first analyze technical reports and formally approve them, with the possibility of revoking them at any time if the conditions and requirements that led to their approval are not upheld.
With a new federal government having just assumed office in Brazil at the beginning of this year, health is expected to remain on the agenda of the full extent of the country’s legislative, executive and judiciary authorities. Several of the main issues for the health sector over the next 12 months are described below.
Ministry of Health
The change in government should significantly modify the Ministry of Health’s priorities. As it has already announced, the Ministry of Health is set to prioritize the following technical topics:
- Increased vaccination coverage for children and adults, considering the current risk of previously eradicated diseases reemerging and serious outbreaks of other preventable diseases, such as Covid-19;
- Incentives linked to Brazil’s National Policy for Technological Innovation in Health and Health Industrial Complex, involving the negotiation of partnerships between public, domestic and foreign laboratories to develop new technologies and manufacture pharmaceutical inputs, vaccines and therapies – for example, via productive development partnerships, customized technology and health compensation measures;
- Improved management for health areas that were neglected during the pandemic (cancer and chronic diseases, and mental, child and reproductive health), as well as joint efforts and routine health procedures, such as integrated surgeries, consultations and tests between public and private services to alleviate the backlog in the public health system (SUS);
- Further implementation of the Digital Health Strategy for Brazil, including in the National Health Data Network.
More than two years after Law No. 13,989/2020 and Ministry of Health Ordinance No. 467/2020 were enacted to temporarily authorize telemedicine in Brazil, Congress finally approved Law No. 14,510 at the very end of 2022. This new law has amended the Organic Health Law (Law No. 8,080/1990) to definitively regulate guidelines for remote health services.
Telehealth regards the provision of health services at a distance, using information and communication technology to securely transmit data and health information through text, sounds, images, or other appropriate media.
The following aspects of Law No. 14,510/2022 particularly stand out:
- Health professionals are responsible for the telehealth practices they conduct. They must observe the responsibilities the law confers on them concerning the exercise of their profession, upholding their professional dignity and safe, good-quality patient assistance. They must also promote the universal access of the Brazilian population to health initiatives and services;
- New regulations that restrict the practice of telehealth must demonstrate that their measures are necessary to avoid compromising patients’ health;
- Patients must be informed and freely consent to any receiving telehealth services, and have the right to refuse it and request in-person care;
- Remote telehealth services are valid throughout all of Brazil. If a health professional provides telehealth services in a jurisdiction other than where they are registered, they are exempt from requesting secondary or complementary registration to perform the service in this new location.
The large-scale use of telemedicine is also set to increase:
- The volume of digital prescriptions, which Anvisa still needs to formally define and regulate. However, the authority has opened a public consultation on the subject, and it should progress throughout 2023;
- Point-of-Care Testing (PoCT) initiatives – any type of diagnostic test performed remotely, inside or outside hospitals or laboratories. PoCT has been the subject of a public consultation that proposed new technical requirements for clinical analysis tests when providing diagnostic and therapeutic support services;
- The use of medical software (Software as a Medical Device or SaMD) is now specifically regulated (Anvisa Resolution No. 657/2022). The definition of SaMD covers any medical, dental or laboratory application system used for prevention, diagnosis, treatment, rehabilitation or contraception. In the coming months, Anvisa should also assess the need for specific rules regarding the use of artificial intelligence within SaMDs.
Impacts of the pandemic
Social distancing and restrictions on people’s movement during the Covid-19 pandemic led to a surge in online sales of regulated medical services and products. The shift in consumer behavior toward this business model should, therefore, become increasingly commonplace in the coming years.
For medical drugs, the regulatory framework for selling these products has provided for the possibility of online sales since 2009 – however, this is limited to licensed pharmacies and drugstores that are open to the general public. Such establishments must also have a responsible pharmacist present during opening hours.
In light of the pandemic, online marketplaces have become more interested in offering products only available in pharmacies and drugstores. Anvisa has been inspecting and assessing these platforms, which have called for more open and transparent discussions of the subject and the creation of regulations applicable to marketplaces’ activities as a way of expanding consumer access to medicine, increasing competition within the sector, and ultimately generating greater benefits for consumers.
In this context, this year, Anvisa is expected to publish the results of a working group established to review technical requirements for remote sales of medical drugs.
In December 2022, Brazil’s government enacted Decree No. 11,287/2022 to formally establish the Brazilian Clinical Research Network (RBPClin). The network aims to encourage scientific and technological development and innovation in clinical research. The entity will function as an inter-sectoral forum for technical-scientific cooperation to strengthen clinical research in Brazil.
Brazil’s House of Representatives is also analyzing Bill No. 7,082/2017, which has already been approved in the Senate. The bill proposes a series of changes to improve the efficiency of clinical research processes – such as the end of double ethical approvals – in addition to changing criteria for the mandatory treatment of participants after the end of a clinical trial.
Cannabis products and psychedelic drugs
After the Federal Council of Medicine (CFM) attempted to restrict the therapeutic use of cannabidiol by the end of 2022 – culminating in the suspension of CFM Resolution No. 2,324/2022 – a new review of the criteria necessary to prescribe these products is expected in the coming months, along with a new public consultation.
Meanwhile, Anvisa Resolution No. 327/2019 already regulates procedures for importing, distributing, monitoring, inspecting, prescribing and selling industrialized products containing active plant derivatives or phytopharmaceuticals from Cannabis sativa, which for medicinal purposes are known as ‘cannabis products’. The resolution determines that cannabis products must be prescribed by CFM-registered medical professionals and only in cases where alternative therapeutic options are unavailable. Anvisa is reanalyzing this resolution, and a proposal for a new text is expected to be submitted for public consultation.
Furthermore, Anvisa Resolution No. 660/2022 also concerns cannabis-derived products, and establishes criteria and procedures for individuals to import these products for their own use for therapeutic purposes if a legally qualified professional has prescribed them.
In line with developments in some other countries, Brazil’s sanitary and clinical research authorities are likely to face more and more requests in the coming months to regularize psychedelic drugs such as psilocybin, mescaline, LSD and MDMA. These substances are considered highly promising for treating psychiatric disorders such as severe depression and trauma, and in some cases, they have even been shown to be more effective than other currently applied methods and drugs.
Verticalized business strategies and new remuneration models
Six years after legislative changes permitted foreign investments in healthcare services, the health sector continues to present opportunities for mergers and acquisitions of all sizes.
Diagnoses and treatments for diseases such as cancer, diabetes, depression, heart disease and elective procedures – neglected during the pandemic – should return to relevance in both the public and private sectors. This is expected to further stimulate verticalization strategies and a shift toward new remuneration models for the health sector, including the medical and health products industry.
This scenario should also favor discussions on new Risk Sharing Agreements (ACRs), in which the purchaser (for example, the Ministry of Health or health insurance companies) and the supplier (industry) share risks regarding the use of a given product. This risk sharing occurs through a variable price defined according to financial or clinical results, or even management metrics drawn up by the parties involved.
Indeed, ACRs serve as a sustainable alternative for acquiring such products, given the upward trend in inflation, operating costs, and rising drug prices – whether due to high demand or just their innovative nature, as is the case with advanced therapies. They also allow the parties to consider the need for continued studies and patient monitoring until the product’s performance in the real world has been properly evaluated.
Given the legal uncertainty brought about by a lack of express provisions regarding the negotiation of ACRs with public entities, Bill No. 667/2021 deserves attention. It intends to amend Brazil’s Organic Health Law to provide for including ACRs as an option when incorporating new technologies into the SUS.
Both Anvisa and the Ministry of Agriculture, Livestock and Food Supply (Mapa) have conducted a significant number of regulatory activities over the last year in relation to the food industry. This should remain the same in 2023, with several topics on the regulatory agenda of both bodies.
Of these, Anvisa Resolution No. 429/2020 deserves particular mention. Taking effect in October 2022, the resolution changed the rules applicable to labeling packaged foods, providing for different timeframes for manufacturers to adapt. Regardless, packaging for food products already on the market when the resolution became effective must meet the new requirements by October 2023.
In practical terms, the nutritional label on the front of a product’s packaging must now feature a black-and-white magnifying glass symbol when the product contains high levels of sugar, sodium or fat content. Moreover, nutrition information tables must comply with a predefined color scheme and include standardized serving sizes. These measures are intended to draw consumers’ attention to the nutritional value of packaged foods, as well as facilitate their understanding of it.
On another front, Anvisa submitted two proposed regulations to public consultation to modernize how food products and packaging are regulated, cut red tape, and simplify the process of regularizing food and its packaging via the National Health Surveillance System (SNVS). The deadline for contributing to the public consultations ended in December 2022, and Anvisa’s Collegiate Board should deliberate and approve the updated versions of the proposed regulations in the near future.
Finally, initiatives from Anvisa and Mapa to create regulatory frameworks applicable to alternative protein products (such as plant-based products and laboratory-grown meat) are also worth noting. Though far from reaching a conclusion, new developments regarding this issue are likely to occur in 2023.
For further information on these topics, please contact Mattos Filho’s Life Sciences & Healthcare practice area.