MEDIA & PUBLICATIONS

Recently, Brazil’s Ministry of Health (MoH) consulted the Federal Attorney’s Office (AGU) regarding the legality of procuring products within the scope of Product Development Partnerships (PDPs) through a waiver of bidding under Article 75, XII of Statute #14,133/2021 (Government Procurement Act), during Phase IV of the PDP. The question appears to have arisen in light of Article 54 of the PDP Regulations (Annex CX of MoH’s Ordinance #5/2017), which stipulates that, after the start of Phase IV, product acquisitions “may be evaluated in accordance with public policies for local production, aiming to reduce the vulnerability of the Brazilian Public Healthcare System (SUS), pursuant to the legislation in force.”

In summary, the AGU (CONJUR-MS/CGU/AGU’s Opinion #299/2026) stated that purchases are only legitimate when they constitute “a necessary and legally adequate means to achieve the objectives of the PDP, notably the technological capacity building of the public institution.” The waiver of bidding is strictly “instrumental and tied to a specific purpose,” and “any expansive or automatic interpretation of the legal exemption provision that encompasses situations where there is no effective transfer or absorption of technology is incompatible with the applicable legal regime.” Based on this understanding, the Phase IV of a PDP, which focuses on verifying whether the technology transfer has been completed, cannot be used as an “indirect extension of the exceptional direct-contracting regime that applies during Phase III.” Allowing this would distort the program’s model and turn PDPs into a “continuous supply mechanism without adequate legal backing.”

The AGU was also unequivocal in its opinion that purchases within the PDP were not possible after Phase IV, that is, after the PDP had been completed. The Attorney’s Office clarified that, once the process of verifying technology internalization is completed, “the legal cycle of PDPs is exhausted,” since “the specific legal basis tied to technology transfer ceases to exist,” which is a requirement for waiving the bidding process. Thus, subsequent acquisitions must “be subject to the ordinary regime of public procurement, or to other legal grounds for direct contracting.”

Read more at: Lexology

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  Ricardo Campello

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  Natália Toledo