Hector Gomes de Sousa, Prohibition Partners
George Brown, Prohibition Partners
There has been considerable progress in the largest Latin American country when making an assessment of the market since 2014, when the first judicial authorisations for medical cannabis was made. In 2015, the 0.2%+ THC prescription permission by the National Health Surveillance Agency (ANVISA) marked an important step and two years later, the first authorisation for a grassroots patient association, ABRACE was made.
In 2019, ANVISA’s new regulation, RDC 327, allowed cannabis products to be sold in Brazilian pharmacies and imports to be made in bulk.
PL 399 represents the latest law to be discussed by the country, as the market is currently awaitinging further discussion and voting in Brazilian legislative bodies, amidst a highly divided political scenario and a worsening and worrisome COVID-19 situation.
It is important to remember that those are contemporary updates, as cannabis has been widely cultivated and used in the country for decades, with racism policies at the core of its prohibition in Rio de Janeiro in 1830, the first known cannabis prohibition law worldwide.
In 2021, Brazil, with over 212 million inhabitants, has made considerable progress, particularly when analysing the prescription evolution witnessed during 2020, reaching an estimate of over 14,500 prescriptions, a 135% increase when compared to 2019.
Looking closely at the data, the first two months of the year also serve as an indicator for the upcoming year, and we witness a steady increase in total patients from 2018 with a total of 318 patients to 2021 with 2.526 patients, meaning that despite the pandemic, patients kept growing, as more doctors become informed and confident to prescribe, and more people become informed on the benefits of cannabis-based treatment and are more open to search for alternatives, in a country where prejudice against cannabis is still high, aggravated by a conservative and poorly informed government lead by president Bolsonaro, vocally opposed to cannabis use beyond strict pharmaceutical approaches.
Also encouraging to witness, is the increase in cannabis-focused clinics in large urban centers such as Sao Paulo, Rio de Janeiro, and Porto Alegre, in a country where over 87% of its population lives in cities.
The country is also becoming an interesting market for foreign and national investors and companies alike, as explained in the Latin American and Caribbean Cannabis Report, and last year witnessed an increase in foreign companies, particularly from Colombia and Uruguay starting working relationships with partners in Brazil, while national media coverage increased as specialized media outlets gained social media presence.
Southern Brazil pharmaceutical company, Prati-Donaduzzi, has been leading the pharmaceutical approach with one high CBD, THC free 30ml registered product – the only one so far besides foreign made Metavyl (Sativex). The company is currently working on new products with different cannabinoid content, and there has been some discussion around including their products in Brazilian universal free healthcare system SUS, the largest of its kind in the world serving over 130 million people. Yet, the challenge around price remains, with the average price of Prati’s CBD near to BRL R$2,000 or USD $350 the bottle, more than the national minimum wage.
While this hilly road has its ups such as the patient increase, wider knowledge and local companies producing, it has had its downs as well. Brazilian patient associations are a reference in the continent in terms of access for patients that cannot afford the prohibitive priced available products, both national and imported, and its presence has been growing steadily with over 35 associations existing today.
The best known, ABRACE, located in the Northeast of Brazil, serves alone over 14,400 patients – a figure that shows the huge impact those associations have nationwide. The organization was recently under the spotlight due to ANVISAS’s request for the organization to stop its “industrial cannabis production” without having the necessary permits, which is perceived by some as an attempt to reduce the association’s reach living space for the pharmaceutically produced medicines, with far more financial power.
ANVISA said it has not requested the association to stop, but rather to adhere to the regulations published in 2019. The situation generated a massive media campaign supporting the association, which says it is doing its best to comply and works in the best possible conditions. A federal court (TFR5) granted the association a permit to continue, yet the dichotomy between regulation and associations will likely have more developments during 2021.
“In Brazil, the associations and domestic cultivation carried out by the patients themselves continues to guarantee access to medical cannabis and bothering companies that try, with patents and persecutions, to establish themselves in the market.”
Emilio Figueiredo, Rede Reforma (Patient Association Network)
While the referred law, PL399, awaits discussion and voting, experts are divided in terms of the likelihood of approval. The law ruled out personal cultivation, which is an attack on individual rights for some and for others a guarantee of quality. It surely is a step forward in a country with millions of square kilometres suited for cultivation, an increasingly informed customer base with relatively high purchasing power in urban centers, and a manufacturing and chemical industry capable of meeting national demand and beyond.
As complex as regulation from ANVISA, a PIC/S (Pharmaceutical Inspection Co-operation Scheme) member, might seem for new players, it is actually a very specific and clear regulation that shines a light on the pharmaceutical path for subtropical and tropical countries and can potentially yield a market advantage for those trailblazers, both associations and companies.
Camila Teixeira, Founder, INDEOV
How would you describe the current scenario when it comes to cannabis in Brazil?
A Challenging scenario ahead but with a “blue ocean” of opportunities. We waited 4 years for Anvisa to respond with a regulation (from the first version of RDC-17-2015, compassive use/direct importation by patients to RDC327-2019 allowing companies to manufacture and import finalized products or semi-finalized products for commercialization, prescription, dispensation, monitoring and inspection of ‘Cannabis Products’.
RDC 327 opened the way: there is no regulatory model like this in the world, it is something specific to Brazil, with one (if not) the highest level of complexity in order to guarantee safety and product quality under the requests of Anvisa, which is one of the most respected surveillance health agencies in the world.
However, the level of regulatory requests, mainly with regard to the availability of raw material to be manufactured and installed that meets the requirements of RDC 327 is the biggest challenge in the market. Most of the international industry were not prepared for this.
However, for those companies that are ready or on its way to submit Anvisa’s analyses to obtain the sanitary authorization to commercialize products in the Brazilian drugstores are foreseeing a potential market as new regulatory model allows sales scalability.
Strategic partnership with companies that have been operating facilitating the access of cannabis products just like Indeov, for example, with pharmaceutical companies will be key to guarantee faster market learning and growth due to their market/technical know-how, physician and patients access combined with the high level of investment, sales potential, R&D and clinical trials opportunities from pharma companies.
We are talking here about the biggest market of Latam with potential from approximately 15.000 patients that have individual importation to approximately 10.000.000 patients considering only the main chronic diseases (Alzheimer, Epilepsy, Autism, Parkinson and Chronic Pain).
What are still the main challenges for patients, doctors and companies?
Companies: To get adapted to the high Pharma standards of Anvisa’s new regulation
Physicians: Education access to feel secure to start prescribing (this is why educating physicians has always been the core of our business of facilitating access to cannabis products in Brazil having a well prepared technical team to support them on becoming cannabis products prescribers). The potential on education is huge as we only have approximately 1500 prescribing physicians in Brazil among a market potential of approx. 450.000 active Brazilian physicians.
Patients:High cannabis products prices still restricts access
Do you think 2021 will bring any major change?
Not major, but some important changes especially with new products being allowed in the Brazilian pharmacies under Anvisa’s RDC 327 (we only have 2 companies authorized to do so up to now). Currently, Anvisa has 8.
Requests for companies to obtain sanitary authorisation to commercialise cannabis products in the Brazilian drugstores. Companies haven’t met Anvisa’s criteria and from the total requests that are currently being analyzed, 85% are in the requirement phase, a stage in which the initial documents have already been evaluated and the agency requested clarifications or additional information to continue the process.
In case these products are allowed this year, the sector believes to bring more competitiveness and more affordable prices for the patients. On the other hand, the competition in the market for the compasive use (direct importation) keeps growing.
Every day more international companies are arriving with more cannabinoid ratios, different presentation, concentrations, volumes as well as different formulation and with more competitive prices, however, in terms of growth opportunity, this model is very restricted as it’s related to individual importation only.