OPINION – Patent Policies and Intellectual Property Challenges in Brazil

Biominas Brasil and Di Blasi, Parente & Advogados Associados law firm were invited by the Industrial Biotechnology Journal to publish an article on the “IB in Depth – Industrial Biotechnology in Brazil: Innovation, Opportunities, and Challenges” issue. The chosen theme was Brazilian Intelectual Property (IP) challenges in the biotechnology area.

The biotechnology area is characterized by highly innovative technologies, which demand significant investments for research and development (R&D). For that reason, it is important for public institutions to protect their innovative projects with intellectual property rights, that ensures market exclusivity for a limited period and, thus, the return on investments.

Therewith, the Brazilian government has implemented public policies, such as the Technological Innovation Law No. 10.973, to improve the strategic use of IP and ensure increased competitiveness of national industries. This law provided incentives for innovation and legal security during interactions between public and private institutions especially concerning IP originating from these collaborations.
Another government action related to the strategic use of IP was the Biotechnology Development Policy, established in 2007 by the Decree No. 6.041. The major objectives of this policy were to increase the number of patents with Brazilian ownership—both in the country and abroad—and to propose actions to disseminate a culture focused on innovation and IP.

Besides the implementation of legal policies, entities such as the Brazilian Patent and Trademark Office (INPI), the Ministry of Development, and Industry and Foreign Trade (MDIC), as well as certain funding agencies such as the Brazilian Development Bank (BNDES) and the Funding Authority for Studies and Projects (FINEP), have created other initiatives to assist with IP rights. One of these, created in the beginning of 2013 by BNDES, in partnership with MDIC and INPI, provides finance services as well as trademark registration and patent application through a BNDES card. Further actions include the creation of guidelines for patent applications examination in the biotechnology field, allowing greater uniformity and predictability in the examination analysis and providing information such as “items not eligible for protection in the country”, among others.

Despite the initiatives of Brazilian policy makers to increase innovation and establish an IP-focused culture in companies and research institutions, an insufficient number of patent applications filings characterizes the current innovation scenario of the country. According to INPI statistics, based on the nationality of the patent applicant, in 2012 the United States was the most prominent country represented at the Brazilian Patent and Trademark Office in all sectors, followed by Brazil and Germany. Even though Brazilian institutions were ranked second, the country’s compound annual growth rate (CARG) in the number of patent applications is very low when compared to other emerging markets. China, India and Singapore present CAGRs of 31,9%, 20,7% e 18,5% respectively, while the Brazilian CAGR is 3,5%. Moreover, according to the World Intellectual Property Organization (WIPO), in 2014 Brazil was ranked 22nd globally in patent applications.

Another important parameter is the ratio between patents filed abroad and patents filed in Brazil by Brazilian organizations. These data showed that Brazilian companies and research institutes’ ratio is smaller than that of other countries, which indicates that many Brazilian inventions are not protected abroad. It also indicates that institutions may adopt a strategy to explore only the national market, or there may be a lack of both “knowledge about procedures” and “financial and human resources” for filing and obtaining an international patent application, being this last assumption alarming.

One reason for Brazil’s poor performance in the rankings of patent applications in international offices is the low proportion of researchers in companies. In developed countries, up to 80% of researchers are working in commercial enterprises, while only 20% are dedicated to academic activities. Furthermore, Brazilian expenditure on R&D is also relatively small.

Additionally, the amount of time required to acquire a patent in Brazil is another challenge. This fact is mainly due to a significant increase in the number and complexity of patent applications and a limited number of qualified examiners. Considering all sectors, in 2012 166,181 patents were waiting for analysis. This figure grew to 181,681 in 2013—almost a 10% increase. It is important to note that between 2012 and 2013 only five examiners were hired.

Although Brazil has made improvements to promote the innovation culture in its institutions, there are still several issues that prevent the country from achieving a positive IP environment across technology sectors, particularly in the biotechnology.