Updates on Drug Distribution Regulation in Brazil
For more than 20 years, Ordinance No. 802/1998 (“Ordinance No. 802/1998”), issued by the Brazilian Ministry of Health, used to regulate the distribution of pharmaceutical products in Brazil. Needless to say that such rule, although very extensive, became outdated and stopped reflecting the dynamics and needs of those involved in the drugs supply chain.
For this reason and for a period of more than two years, the update of Ordinance No. 802/1998 was discussed by the Brazilian National Health of Surveillance Agency (“ANVISA”) and the interested entities through a Public Consultation.
Finally, after such a long discussion period, ANVISA approved a new Resolution to regulate the subject (Resolution RDC No. 304/2019) for providing for the “Good Practices of Distribution, Storage and Transportation of Drugs”. The Resolution aims at ensuring greater flexibility to the supply chain, control and traceability conditions, considering the existent technology.
Although published in September 2019, Resolution RDC No. 304/2019 will enter into force only in March 2021, except in relation to one specific article, through which ANVISA expressly authorizes the commercialization of drugs between distributors, if both distributors ensure the traceability of the product. This provision is a desired novelty as, under Ordinance No. 802/1998, distributors were only authorized to source from the marketing authorization holder.
In March 2020, Resolution No. 304/2020 was amended by ANVISA’s Resolution No. 360/2020 for considering a large number of requests submitted by the industry.
Main changes brought by Resolutions Nos. 304/2019 and 360/2020
When compared to Ordinance No. 802/1998, the main changes arising from Resolutions RDC Nos. 304 and 360 are the following:
- ANVISA authorized the commercialization of drugs between distributors, provided that the traceability of the product is maintained. Under the previous rule, distributors could only purchase drugs from the marketing authorization holder
- All parties involved in the supply chain will be responsible for the quality and safety of the drugs, including for recalls actions. According to the previous Ordinance, it was the sole responsibility of the producer.
- Allows the reintegration of the recovered drugs into the company’s stock after cases of robbery, theft or any other type of misappropriation. However, the reintegration may only be implemented after performing a technical evaluation of the product to evidence that there was no damage and that the quality, safety and efficacy of the drug is guaranteed. Exceptions apply.
- The Resolution authorizes the outsourcing of activities, provided that the authorization agreement is approved by the quality management and qualification system of the contracting party. In addition, the contracting party must provide the contractor with the information necessary to perform the contracted operations correctly, in accordance with the registration of the drugs and any other legal requirements.
Thus, it is perceived that despite creating new responsibility for all those which integrate the supply chain, the new Resolutions seek to ensure greater flexibility to activities related to distribution, adjusting it to market’s current expectations, as Ordinance No. 802/1998 served the completely different moment and technology of 20 years ago.
The flexibility and extension of regulatory responsibilities, however, increase the need of having sophisticated distribution agreements, covering not merely commercial matters, but also compliance topics and the regulatory obligations applicable to, for example, pharmacovigilance, recalls, quality matters and responsibilities regarding third parties (i.e, other distributors).