The doubtful future of public private partnerships


Otto Licks and Felipe Mesquita

The relative stability of the Brazilian economy and the large amount of public funds earmarked for the national health budget have sparked the interest of the pharmaceutical industry.

In Brazil, this can be divided into four different groups: research-based; foreign generics; local branded copies without interchangeability (known as similares); and government-owned pharmaceutical industries.

The Brazilian government is the largest player in the market, controlling 17 industries and the regulator (responsible for marketing approvals, pharmacovigilancy and price controls). It is also the country’s largest client. This unique combination has fostered the development of public private partnerships (PPPs) in the pharmaceutical industry, diverting the statutory intent of the law on PPPs.

When the law was enacted, its purpose was to implement PPPs to allow public services to be explored by private companies by means of concessions. Article 2 allowed for an ‘administrative concession’. A private company is hired to assume several public service obligations on behalf of a government entity.

PPPs, pharmaceuticals