Study analyzes regulation of generic drugs in Brazil

Researchers at the INSPER in Brazil and the LSE in the UK evaluated factors such as the equivalence, prescription, and substitution of generics.

By Maria Fernanda Ziegler  |  Agência FAPESP – Less than 20 years after Brazil began producing generic drugs – non-branded versions of brand-name drugs with expired patents that have the same active principle, the same concentration, and the same dosage form – generics account for more than 25% of all pharmaceutical sales in the country.

In an article published in Pan American Journal of Public Health, Elize Fonseca at the Education & Research Institute (INSPER) in São Paulo City and Ken Shadlen at the London School of Economics (LSE) present a case study on the regulation of generic drugs in Brazil and compare national approaches to promoting and regulating such medicines. The study was supported by FAPESP through its Young Investigators Grants.

“People often think the regulation of generics in Brazil is well established, but actually, it hasn’t been studied very much. We wanted to understand how and why Brazil opted for the regulation in force. It’s important to understand this because the regulatory framework governs a market with several key players, such as government, consumers, and pharmaceutical companies, and can extend or restrict access to medicines,” Fonseca told Agência FAPESP.

The study stresses that the diverse factors and interests of both the public and private sectors shaped the design and implementation of the regulatory framework for generics in Brazil.

The authors say four dimensions are crucial to evaluate generic drug regulation: equivalence, packaging, prescription, and substitution. Key questions included how the equivalence of generics to reference drugs is demonstrated, whether generics are allowed to display brand names on packaging, whether doctors can prescribe generics specifically, and whether pharmacists are authorized to substitute innovator products for generics. 

Findings were based on empirical data collected between 2007 and 2015 from Brazilian government documents (such as generic drug regulation policy memos and official speeches) and more than 400 newspaper articles and scientific papers. 

These data were supplemented by 60 interviews with regulators and government officials who had participated in designing and implementing Brazil’s generic drug policies. 

According to Fonseca, the Brazilian example is crucial to reach an understanding of generic drug regulation. Brazil has the largest market for generics in Latin America and, despite high levels of market penetration, there have been conflicts between government, pharmaceutical companies, and consumers. “At its foundation, regulation is not just a technical matter. It’s also political,” she said.

According to the authors, Brazil’s 1999 Generic Drug Law “was an opportunity to foster the use” of generic names (or Brazilian non-proprietary names) “as a prescription rule and improve the pharmacology requirements to register non-patent drugs”.

In practice, the rules on packaging, which must include a yellow stripe and a large letter “G” to indicate that the medicine is generic, increased the use of generic names in place of brand names.

Another item analyzed was the rules governing prescriptions. Physicians prescribing for patients in SUS, Brazil’s national health system, are required to use generic names, whereas, in the private sector, physicians are not bound by this rule and can prescribe by generic or brand name. 

The article mentions a 2006 survey of eight Brazilian cities in which 55 health professionals were asked for their views. The results showed that 44% believed generic drugs were not as reliable as the originals and that, even among those who trusted generics, 17% did not prescribe them.

Bioequivalence

In Brazil, the discussion of generic drugs began during the 1970s, but effective change did not occur until 1999, when Law 9787 created the conditions for generics to be introduced according to the standards recommended by the World Health Organization (WHO) and implemented in Europe, the US, and Canada.

The first generic drugs were registered in the year 2000. At the same time, action was taken  to encourage local firms to produce generics and to facilitate imports of key inputs.

“Before Law 9787, local firms could copy reference drugs without submitting any proof of therapeutic equivalence,” Fonseca said. “The bioequivalence requirement forced various producers out of the market because they were unable to adapt to the new rules.” Bioequivalence means that the active ingredient of two drugs has the same rate and extent of absorption at the same dose and under the same conditions. 

It is important to note, Fonseca continued, that in an extreme scenario, limiting the number of competitors can drive up prices and restrict the public’s access to medicines. “Competition is vital in this market to reduce drug prices,” she said.

Brazil has stringent requirements compared with those of other Latin American countries, the researchers write, pointing to a study by the Pan American Health Organization (PAHO) that found that no other national regulatory authority in the region required bioequivalence for so many drugs. Out of 86 drugs analyzed in Latin American countries, proof of bioequivalence was required for 51 in Brazil.

During the early 2000s, ANVISA, the Brazilian health surveillance authority, created various instruments to assist local manufacturers, including a fast-track approval procedure for firms prepared to register generics.

ANVISA also provided continuous support to local firms and oversaw changes to their regulatory departments. As a result, Brazilian firms became expert at bioequivalence testing, which had previously had to be performed abroad. By 2009, 87.6% of such tests were carried out in Brazil.

“The consensus among representatives of the pharmaceutical sector now is that the generic drug regulations, first seen as a threat to their survival, were ultimately instrumental in improving drug manufacturing plants and processes,” the authors write.

Regulation in other countries

Fonseca and Shadlen plan to use the methodology developed for this study to compare the regulation in different Latin American countries. Their aim is to study how regulating generics works and to understand trade relations in the region in a case-by-case approach to the issue in Chile, Colombia, Argentina, and Mexico.

“Negotiations are under way, and there are several ongoing attempts to harmonize generics regulation across Latin America,” Fonseca said. “It’s a controversial matter, whether we should harmonize or not. Each country has a different kind of regulatory framework, and this creates trade barriers. From answers to our four key questions, we’ll be able to get a better grasp of regulation in the region.”

The WHO recommends a set of rules, but for reasons of sovereignty, the regulatory agency in each country must choose those it deems appropriate.

The article “Promoting and regulating generic medicines: Brazil in comparative perspective” by Elize Massard da Fonseca and Kenneth Shadlen can be read at iris.paho.org/xmlui/handle/123456789/33835.