Monday, April 22, 2013

Meanwhile in the Brazilian Medical Device Industry

     Since Brazil has become one of the main destinies of many sectors worldwide, either because of its market size or its rising middle class, constantly monitoring what is happening inside its borders has become a routine task for foreign investors. The medical device industry is no exception, especially with such complex/bureaucratic regulatory system.

        However, this seems to be heading to a more harmonized system. A new Brazilian Good Manufacturing Practice (BGMP), RDC 16/2013, has gone into effect in the country. It means that two different BGMP resolutions (RDC 59/2000 for medical devices and Ordinance 686/1998 for in vitro diagnostic (IVD) devices) have been replaced by the new single one. The sector now only have one requirement to meet, hence, the BGMP has become less complicated. Companies now have 180 days to update their quality system and make it meet RDC 16/2013.    
        Another fact that has happened to the Brazilian medical device industry, and deserves both national and  foreign attention: in the end of last month (March, 2013) the Brazilian Medical Device Industry Association (ABIMO) has claimed, in Congress, the approval of a law that ensure tax isonomy between brazilian and imported products. Today, public and philanthropic hospitals have tax immunity when purchasing imported medical device.

“We do not want differential treatment. We are competitive. We export to more than 180 countries. Abimo’s proposal is simple: ensure tax immunity for all purchase orders made by institutions linked to SUS (Brazilian public healtcare system).”

Paulo Henrique Fraccaro, Abimo’s President            

        These two initiatives seem to be an effort to boost the national industry and make it more competitive. 


Friday, April 5, 2013

Senate Votes to Repeal New Medical Device Tax

The Affordable Care Act, signed into law back in 2010, includes a 2,3% that will be charged on the total revenue of a medical device company, regardless of whether the company generates profit or not. It was meant to start this year and due to the polemic that it has raised among the medical device industry and in Congress, a repeal amendment was proposed.

On Thursday, March 21st, the US Senate voted a 79-20 tally to repeal the medical device tax. The voting was bipartisan; it included 33 democrats against the tax. The amendment proposed is called Medical Device Access and Innovation Protection Act, introduced by both a Republican and Democrat Senators. The reasons for such a support to the amendment are due to a concern of losses in profits, job creation and R&D investments. The opponents to the repeal claim that the new tax will raise a $30 billion in 10 years and it will be funding the Affordable Care Act.