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The Brazilian Market: A Regulatory Overview for Orthopaedic Products

Doing business in Brazil means dealing with the Good Manufacturing Practices (GMP) certification. For many years, the Brazilian National Health Surveillance Agency (ANVISA) had a long waiting line to schedule GMP audits, delaying the ability of many companies to start their business in Brazil. However, in October 2017, regulation RDC 183/17 was published to change this scenario, bringing some possibilities to speed GMP certificate issuance, basically through the acceptance of audit reports of other agencies or certification bodies.

Despite being a recent regulation that needs clarification in some aspects, this is considered a very important change that will reflect the decrease of the timeline for approvals in Brazil.

With this in mind, we sought a refresher on market entry in the region.

About BrazilBrazil edit

With a population of over 200 million, Brazil is the world’s fifth-largest country and boasts the ninth-largest economy. It is also the largest market for medical devices in South America and home to about 6,500 hospitals and 18,000 diagnostic laboratories. Brazil has some of the highest-quality hospitals in Latin America and attracts patients from neighboring countries (mostly for plastic surgery, cancer and cardiovascular treatment).

About 65% of the population has private healthcare insurance. The remaining population depends upon the public health system (SUS).

The Brazilian medical industry has huge growth potential. Its nearly 4,000 domestic factories manufacture medical devices, but very few highly-qualified ones exist and they struggle to meet the demand for products.

On the other hand, even with the growing base of locally-manufactured products, most surgeons still prefer to use imported products due to the reliability of certain brands. Approximately 80% of all medical products used in Brazilian hospitals are imported, and the country has around 10,400 distributors. Therefore, foreign companies have a great opportunity in the Brazilian market, as it is still mostly dependent upon imports.

Brazil imports a wide variety of orthopaedic products, instruments, cements and related devices. Prostheses and implantable products represent 15% of the medical market, behind only materials and consumables (19%) and reagents for in vitro diagnostic (20%).

Brazilian Regulatory Agency

Brazil is known for its complex regulatory system, periodic changes in regulation, long process time and high costs required for registration approval and import. As with the majority of healthcare products, orthopaedic implants and instruments also require previous approval from ANVISA before they are commercialized.

ANVISA is the regulatory authority that protects and promotes public health and controls production and marketing of products and services subject to health surveillance, including environments, processes, materials and technologies related to them. ANVISA also has health control of ports, airports and borders, and is characterized by administrative independence and financial autonomy.

The agency comprises of individual divisions, each supported by specialized staff, responsible for the analysis, approval and control of a type of product, for example: orthopaedics (CMIOR), materials (GEMAT), in vitro (GEVIT) and so on.

Entering the Brazilian Market: Step by Step

The Legalization of a Company

The approval of a product for sale in Brazil involves many steps that demand highly-specialized knowledge.

The first step is to select the Brazilian company that will be used as a local registration holder, as foreign companies can’t register products directly. The registration holder must have all required licenses that satisfy local regulations. In summary, there are three options to secure a registration holder: 1) Open a subsidiary in Brazil, 2) Find a duly-licensed local distributor or 3) Work with a legalized company that will own the registrations and authorize distributors to import and commercialize the products. Legalization refers to the process of securing permits and authorizations needed for a company’s operation under State, Municipal and Federal Sanitary Surveillance. A company that is legalized has completed this process.

The above options require extensive research, establishment of agreements, costs and time. For instance, opening a subsidiary in Brazil (Option 1) requires some patience, as the legalization process takes at least one year.

Because of the several legal steps involved in this process, it is very risky for a foreign company to try to obtain all the licenses and registrations without the assistance of some professional or a consulting company with expertise in the local requirements. If the company decides to work with a distributor (Option 2), deep research is required. Usually, this is the first option that is considered by non-Brazilian companies.

For our clients who seek assistance in finding local distributor, we recommend seeking a representative in Brazil from the Chamber of Commerce or Consulate of their own country. It is also advisable to have a trustworthy lawyer assist with the contracting process with such a company. When our clients ask for recommendations, we explain that they should hire a local lawyer with experience in both the Brazilian regulatory sector and the local laws. Additionally, keep in mind that the product registration in this case is held and owned by the distributor.

In Option 3, products are registered with a duly-legalized company that will issue authorization letters for Brazilian distributors that your company may choose. This is a common choice for foreign companies that wish to control their registrations without opening a subsidiary or without being dependent upon only one distributor. Transferences of registrations are allowed in Brazil; therefore the companies usually begin with this option. Then, after gaining an understanding of the market, they open a subsidiary and transfer the registrations to their own name. Even though there are expenses associated with a registration holder, you have the flexibility to work with as many distributors as desired, which may be a better strategy, considering the size of Brazil.

The Product Registration Process

Next, it is time to think about the registration process of the products.

ANVISA has its own classification for medical devices (RDC 185/01) that is divided into four classes of risk, in which Class I represents low risk (non-invasive products, for temporary use surgical instruments, for example) up to maximum risk, Class IV (permanent and surgical products for long term use that are biologically absorbed, for example). The majority of orthopaedic products belong to Class III, but some may be classified as Class IV, such as resorbable implants or those that incorporate medicines.

The difference among the four classes of risk is the complexity of the process to be submitted and specific documents required. For Classes I and II (RDC 40/15), the submission of a notification process is enough to have the approval of the product. For Classes III and IV, a complete registration process is mandatory, with legal documents, details about the manufacturing process and clinical data.

The classification also influences the timeline for approval. By law, ANVISA has 90 days to complete all processes (e.g. initial product registration, updates on the registrations, GMP requests, etc.); however, processes for Class III and IV products usually receive technical demands (deficiency letters), so the time can increase from 90 days to one year, or even longer.

A company without proper assistance can waste years trying to get products into the Brazilian market. Foremost, the registration process may be automatically denied by ANVISA if the process is not prepared in compliance with local regulations.

Specific Regulations for Orthopaedic Products

ANVISA has published two regulations that are specific for the registration of orthopaedic products: RDC 59/2008 and IN 01/2009. (The regulations are published in the official gazette, and are available online for reference, but only in Portuguese. We provide our clients with a translated version.)

These requirements have some peculiarities, so one might need to submit several registration processes to register one line of products. For example, cemented and non-cemented implants must be registered separately. Another example is surgical instruments that should be registered separately from the implants.

The most frequent questions and technical demands received from ANVISA during the registration of these products are related to mechanical tests, critical evaluation reports and tests performed to establish parameters for the product, such as stability studies, raw material standards, etc.

There are promises that these regulations will be reviewed in the future, reflecting the suggestions and needs of current manufacturers that have already products in the market. Specifically, ANVISA promises to review the regulations, but there is no proposed timeline yet. ANVISA intends to review the criteria of the IN 01/2009 to facilitate the grouping of products into one registration.

GMP Certification

As noted earlier, Brazil has another particularity in the registration process: the Good Manufacturing Practices certification, applicable for medical devices Classes III and IV. This is a certification issued by ANVISA that also belongs to the Brazilian registration holder.

For years, ANVISA had a long waiting line to schedule GMP audits. The publication of regulation RDC 183/17 offers possibilities to speed the GMP certificate issuance, basically by accepting audit reports of other agencies or certification bodies.

This new regulation allows ANVISA to choose whether or not to perform the audit based on a risk analysis approach. Along with product risk, several factors will be considered, such as manufacturing technology, history of recalls, etc. ANVISA will also consider how the GMP audit could add value to the regulation process and, of course, the operational capacity of the Agency to perform the audits.

Conclusion

The new change in the GMP regulation is just one of the signs that show Brazil is moving toward regulatory convergence. The country is also part of the Medical Device Single Audit Program (MDSAP) and International Forum of Health Product Regulators (IMDRF), demonstrating its efforts to establish trust among international regulatory agencies, with the intention to improve and optimize the work processes and facilitate the relationship among the countries.

At the same time, the healthcare system in Brazil is gradually improving and becoming more accessible. While Brazil is not an easy country to enter, it is not impossible if you know the right way to do so. Despite its challenges, Brazil has a large and diversified economy and is still considered a country that offers excellent business and investment opportunities in the medical device market.

Ms. Juliana Ramos Gouveia is a Regulatory Affairs Specialist with Vera Rosas Regulatory Affairs, focused on the biomedical sector, with six years of experience working with Brazilian National Health Surveillance Agency issues. She is an expert at regulatory approvals for medical devices in general (equipment, orthopaedics, implantable devices and consumables), IVD, sanitizing and cosmetic products. She may be reached via This email address is being protected from spambots. You need JavaScript enabled to view it..

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