Ernest Kawka / LinkedIn: Ernest Kawka
Anjam Aziz / LinkedIn: Anjam Aziz
Long patent examination backlogs are devastating for innovation, economies, job creation, and the launch of new medicines. A recent study found that long patent review times costs the global economy $10 billion annually, and is especially harmful for small start-up firms (1) . Specifically, every year of delay reduces the start-up’s employment growth by 21% and sales growth by 28% over the five years following the approval of the patent application (2) . Patent backlogs are problematic in some of Latin America’s largest economies, including Brazil.
Brazil is the world’s 7th largest economy (3) and is viewed globally as a strong emerging market. In the last decade the country’s growing entrepreneurial culture has attracted increased foreign investment (4) (5) . Unfortunately, Brazil’s notorious patent backlog poses a serious roadblock to unlocking the country’s full economic and innovation potential.
Patent applications in Brazil have historically experienced some of the longest delay times in the world, averaging eight years for all inventions and over 10 years for medicines (6) . A recent analysis from Osha Bergman Watanabe & Burton LLP confirmed that the patent backlog issue persists in Brazil, finding that the average patent examination timeline for biopharmaceutical patents granted between January 1, 2020, and March 23, 2022, is 10.25 years.
| Year | Number of Biopharmaceutical Patents Granted | Average Patent Examination Timeline (in years) |
| 2020 | 2020 | 10.45 |
| 2021 | 1815 | 10.07 |
| January 2022 — March 2022 | 241 | 9.87 |
| Combined | 4076 | 10.25 |
Indeed, Brazil’s patent backlog is comparable to some of the worst patent backlogs in the world, including Thailand where it takes, on average, 10 years to get a patent (7) . By comparison, drug patent reviews average approximately three years in China, four years in Chile and under two years in the United States (8) . In the health care industry, patent backlogs can prevent life-saving treatments and cures from reaching patients.
Brazil has attempted to address the patent backlog by hiring additional examiners, leveraging work sharing programs, and eliminating a dual examination process associated with the Brazilian National Health Surveillance Agency (ANVISA) (9) . And in 2019, reformist Claudio Vilar Furtado took over the National Institute of Industrial Property (INPI) and committed to promoting competition and improving the intellectual property (IP) system (10) .
Despite these efforts, the patent backlog issue persists in Brazil, and the policy environment for innovation is worsening in the country. A 2021 Supreme Court decision declared unconstitutional the country’s minimum 10-year patent term, regardless of how long the patent examination process takes. For biopharmaceutical innovators, that decision was even more damaging because it was applied retroactively to all health-related inventions — eliminating overnight thousands of patents. This decision leaves a serious gap in innovation policy.
The combination of Brazil’s extremely long patent examination backlog and no mechanism to account for examination delays means innovators could have patent protection for as little as one year (11) . Since inventors have no mechanism to compensate for lost exclusivity time when patent reviews are delayed, it is difficult for companies to invest the billions of dollars needed to research and develop new medicines, resulting in a growing threat to innovation ecosystems across Brazil, Latin America, and the globe.
Brazil can address the patent examination backlog
Countries are tackling patent backlogs directly by implementing Patent Term Adjustment mechanisms (PTA) which compensate innovators for the period of patent term lost due to examination delays. PTA processes vary across countries, but Brazil does not need to look far for examples. In Chile, innovators can apply for PTA if a product is delayed by more than five years after filing or by more than three years after a request for an examination (12) . The United States and Korea implemented a similar process. Clear and reliable PTA rules give biopharmaceutical companies the confidence to invest in the development of new medicines.
A recently introduced bill, PL 2056, seeks to introduce elements of PTA in Brazil (13) . This is an important step to remedy a longstanding deficiency in Brazil’s innovation ecosystem, and help address the void left by the 2021 Supreme Court decision.
In seeking to address patent backlogs, the stakes are high for Brazil’s economy, its international standing, and the health of its citizens. As the country begins to recover from the financial toll of the Covid-19 pandemic, a focus on rebuilding the economy is even more pressing. However, patent delays hamper entrepreneurship and the ability for businesses to grow. Patent backlogs might also hinder Brazil’s OECD accession process (14) .
For patients, the consequences of weak IP systems are grave. Due to its size and influence, Brazil is positioned to develop and implement leading innovation policy that would impact the Latin American region and beyond. Implementing PTA can demonstrate Brazil’s commitment to economic growth and improved health outcomes in the eyes of its people and the world.
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(1) https://sls.gmu.edu/cpip/wp-content/uploads/sites/31/2016/10/Schultz-Madigan-The-Long-Wait for-Innovation-The-Global-Patent-Pendency-Problem.pdf
(2) Id.
(3) https://www.portaldaindustria.com.br/cni/en/facts-and-figures/brazil-glance/
(4) https://valorcapitalgroup.com/why-brazil-brazil-is-the-beta-market-of-the-world/
(5) https://www.portaldaindustria.com.br/cni/en/facts-and-figures/brazil-glance/
(6) https://nuestrasaludlatam.org/wp-content/uploads/2022/05/Brazil-Significant-Pharmaceutical Backlogs-Remain-in-Brazil-ENG.pdf
(7) https://sls.gmu.edu/cpip/wp-content/uploads/sites/31/2016/10/Schultz-Madigan-The-Long-Wait for-Innovation-The-Global-Patent-Pendency-Problem.pdf
(8) https://catalyst.phrma.org/the-time-is-now-to-address-brazils-notorious-patent-backlog
(9) https://geneva-network.com/research/building-a-predictable-stable-patent-system-in-brazil/
(10) https://geneva-network.com/research/building-a-predictable-stable-patent-system-in-brazil/
(11) https://geneva-network.com/research/building-a-predictable-stable-patent-system-in-brazil/
(12) https://geneva-network.com/research/building-a-predictable-stable-patent-system-in-brazil/
(13) https://www.lickslegal.com/news/welcome-patent-term-restoration
(14) https://www.gov.br/pt-br/noticias/financas-impostos-e-gestao-publica/2022/01/ocde-formaliza convite-para-que-o-brasil-ingresse-na-entidade. 3 / 3
