Long-term integrated public policies are the key to Brazil’s growth

Revista FACTO Abifina - número 50 | 01/18/2017
Dante Alario Jr. has dedicated his life to pharmaceutical area. After the first job in his father’s industry, he established his own company - Sanus -, which posteriorly bought from Monsanto the Biolab brand, in 1997. Today, Alario is a technical-scientific director of the company and activist in the defense of national innovation, which led him to assume the position of pharmaceutical vice-president of ABIFINA. With this trajectory, added to his multiple education - he is a chemist, administrator, sociologist, and of course, pharmacist -, Alario gives an overview to FACTO about the sector regarding the current crisis. The entrepreneur glimpses new threats - such as entry of new multinational players in generic drugs sector - and opportunities - such as Agência Nacional de Vigilância Sanitária (Anvisa) being more supportive to industry. Nevertheless, first of all, he advises: “what will trigger Brazil to grow again are well-planned public policies, guided to the chosen sectors, applied in long-term”. 

DO YOU CONSIDER THAT BRAZIL WILL GROW AGAIN WITH GOVERNMENT REFORM? OR SHOULD WE MOVE IN A DIFFERENT DIRECTION? 
The proposed reforms are important, and not only in Brazil. We have a world movement. These are controversial, delicate themes, which should be handled with cautious, but should be faced so that governments can align their costs. However, this is not enough. The government needs to stimulate selected sectors to invest in innovation. The phase of commodities, which Brazil made good use of, is gone. Today we live the technology. We do not talk anymore about reducing price and earning by quantity sold. Not even in China, where technologies have been sophisticated. Therefore, reforms are important to balance, but not for the country to grow again. What will trigger Brazil to grow again are well-planned public policies, guided to the chosen sectors, applied in long-term, with qualified workforce and investments in technological development. It is important to highlight that policies should be conducted in partnership with entrepreneurial sector, because they often come top-down. We need more dialogue, to stop talking and start doing. 

FROM COMMERCIAL OPENING IN 1990s, BRAZIL HAS HAD SEVERAL PUBLIC POLICIES WITHOUT RESULTS FOR ECONOMICAL AND SOCIAL DEVELOPMENT. WHY DOES THIS HAPPEN? 
First, because divestment in 1990s was so high that consequences can still be seen today. This brutal divestment occurred in the initial stages of industrialization, in case of pharmachemical, where companies had not been consolidated yet and industrialization process rupture left a few healthy “inheritors” to continue.
The fact that public policies aiming at the resumption of economic development of Brazil were not continued is also a burden. Each new government, minister or secretary wants to play politics on their own way, not considering what predecessors did. I have to repeat an old, but true sentence: certain policies should be State and not governmental. And it did not happen. 
A better goal setting of the strategic sectors is also missing, once there is no possibility for all industrial areas to be considered a priority. Insufficient investment in technology and innovation, from both governmental and private sector, is another issue. They talk too much on innovation, but a few have put it into practice. 

DO GOVERNMENT AGENCIES AND BODIES NEED TO WORK IN AN INTEGRATED AND MORE SUPPORTIVE MANNER TO PUBLIC POLICIES? 
An individualism already mentioned is added to a disconnection between ministries and their bodies and to a major politics ruled by Executive power, in such a way that is even harder to execute an industrial policy to a sector and consequently to a country. 

WHICH SECTORS SHOULD BE ELECTED AS STRATEGIC FOR INDUSTRIAL POLICIES? 
The government is responsible for deciding. The government of Lula chose pharmaceutical industry, but it was not continued. When we talk about pharmaceutical industry, there is no project with less than 20 years. A public innovation policy would have as a result its first finished molecule after at least eight years. Anywhere in the world, pharmaceutical sector is considered strategic and a priority. 
I am talking about pharmachemical sector together. Generic drugs have an important place in public policies because they help to regulate the prices. In this segment, raw material is fundamental. A good thing for Brazil is that big global producers of generic drugs are not in the country yet, because when they arrive, our industries will not deal with competition. They have a production of their own pharmaceutical inputs, while we depend on import. 

DOES IT MEAN THAT VERTICALIZATION IS EVEN MORE IMPORTANT FOR GENERIC DRUGS?
Yes. We need quality raw materials with a competitive price. 
HOW IMPORTANT IS FINE CHEMICAL COMPLEX AND ITS SPECIALTIES IN A CONTEXT OF SUSTAINABLE INDUSTRIAL DEVELOPMENT POLICY?
Fine chemical complex and its specialties are essential so that Brazilian government can elaborate a health policy and be sure to have it met, along with pharmaceutical industrial sector, searching for a better service to our population. 

HOW TECHNOLOGICAL INNOVATION, INTELLECTUAL PROPERTY AND SANITARY REGULATORY MILESTONE ARE RELATED IN THIS SECTOR? 
Without innovation there is no future, especially for pharmaceutical industry. Even big multinational companies of generic drugs today have investments in innovation. Intellectual property is a consequence for those who make innovation, because they want to have their products protected after years of great investments in R&D. Finally, regulatory milestone should be part of that chain of ministries and bodies which should work together to execute public policies of Executive Power. 
Bearing in mind what regulatory agencies of other countries practice, we should not forget that, in Brazil, our conditions are different. Other relevant factor is that regulatory agencies of these countries never stop stimulating local industries, being considered as essential to innovative companies’ development. Thus, regulatory environment is much or more important for innovation than other factors.

CAN YOU GIVE AN EXAMPLE? 
To the end of the year, Biolab shall inaugurate a research, development and innovation site in Canada. The Canadian regulatory agency shows, analyzes, guides. It is a relative by the book. If the company conducts a specific assay differently, but can prove the result is safe, they approve it. They act more to guide than to punish. Fortunately, I see that Anvisa has started to follow this path. This is important, because following a manual is not only repeating procedures. On the other hand, you have “to get out of the box” to innovate. 

IN YOUR EXPERIENCE AS AN ENTREPRENEUR, HOW DO PHARMACEUTICAL AND PHARMACHEMICAL COMPANIES HANDLE WITH THE DIFFICULTY TO INNOVATE IN BRAZIL?
I can assure it is not easy. Bureaucracy extends from agreement with university to regulatory agency. To import an intermediate product and have it in my workbench, it takes three to six months. In Canada, it takes a week. How to handle with it? There is no way. We face it and that’s it. The alternative for Biolab was transferring some research phases to Canada. We cannot keep our heads down to difficulties. With all the efforts, in the end the results are good, they are worth. But we should think: how long could it take for the company and citizen to have that drug? How much time do we waste with bureaucracy? 

IN THE CURRENT SCENARIO, HOW DO YOU SEE THE DRUG INDUSTRY IN THE COUNTRY? 
National pharmaceutical industries meet the requests of the government because they are the biggest manufacturers of generic drugs in Brazil. They also do that, because they comply with the order of the government to produce here by PDPs [Productive Development Partnerships], biosimilar drugs and other products, which use an important part of the budget of Ministry of Health, instead of importing.

Today a strong group of national pharmaceutical industries are firmly established in incremental innovation and already have some good initial results of radical innovation. As I’ve said before, innovation is what enables development and perpetuation of this industrial sector. 
We all understand that internationalization is part of our industrial future, and in order to make this happen more consistently, there must be patented innovative products. This will be the best way to internationalize. 


THE MINISTRY OF INDUSTRY RECENTLY RELEASED THE PROGRAM ‘BRASIL MAIS CONSTRUTIVO [A MORE CONSTRUCTIVE BRAZIL]’ TO ELEVATE PRODUCTIVITY OF SMALL- AND MEDIUM-SIZE INDUSTRIES. WHAT DO YOU THINK OF THIS INITIATIVE?
Every program focused on small- and medium-size companies should be applauded, because they are the biggest employers of the country. It would also be welcomed a program for them to access new technologies, to make improvements on products and to develop a more agile service. 

HOW DO YOU SEE THE PROPOSALS OF BILATERAL TRADE AGREEMENTS WITH DEVELOPED COUNTRIES? 
All of them, without exception, want to export as much as possible and to import as little as possible so that final balance is positive for industries and for the country. It is inside this context that trade agreements are made. Thus, the most economically developed countries try to make agreements to enable them to export their high-technology-added products and services with advantages - therefore, the most expensive ones - and to import those with less technological content - it means, the cheapest ones. 
Avoiding this is almost impossible in a globalized world. Thus, we need to be careful so that trade agreements are not considered as a factor preventing countries with less bargaining power from growth and development. Otherwise, such limitations would occur in the garb of legality. We have to discard the idea that a device from a developed country is automatically applied to other country, without any analyses or considerations between their different realities. To relevant themes such as brands and patents, governmental acquisitions and others, attention should be duplicated.
 
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