Newsletter 2015.08 – A Fine to Remember: Brazilian Antitrust Authority Condemns Pharmaceutical Company to Pay 11 Million USD

The administrative court of the Brazilian antitrust authority (Conselho Administrativo de Defesa Econômica – CADE) has very recently fined a major pharmaceutical industry in over 36 million Brazilian reais (approx. 11 million American dollars) for sham litigation involving the patent application in Brazil of a blockbuster drug used in the treatment of cancer. Although this is not the first millionaire fine imposed by CADE on a pharmaceutical company, cases like this are still rare and the case law of the bureau’s administrative court, which is a federal nonjudicial instance encharged with enforcing the constitutional economic principles, such as free enterprise and free competition, is still being built.

 

In the present case, the accused company has filed a patent application for a procedure to produce the abovementioned drug before the TRIPS Agreement had come into force in Brazil (later it has broadened the application’s claims to include the drug itself). As it is of common knowledge, Brazilian Law did not admit the patentability of chemical and pharmaceutical compounds until the issuance of the new Industrial Property Act in 1996, which was passed by Congress in order to comply with TRIPS. Notwithstanding the foregoing, by the time the applicant has requested the examination of the invention before the Brazilian Patent Office (BPO), the TRIPS agreement had indeed come into force.