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Pharma trademarks in Brazil: an exception to the rule

Brazil’s trademark law requires rights owners to use their marks, but there is an important exception to this rule, and pharmaceutical companies in particular should take note. Paulo Bianco of Kasznar Leonardos reports.
 
A massive investment in time and money is required through the phases of research, development and launch of a new product in the market. Even when the product is ready to be produced on a large scale, pharmaceutical companies still depend on marketing approval from the Food and Drug Agency (in Brazil, this is called Anvisa).
 
This article will discuss pharmaceutical companies’ obligation to use a registered trademark (as any other trademark registration owner), while also facing serious challenges to start or continue trading their medicines.
 
The Brazilian Patent and Trademark Act (LPI), Law #9,279/1996, establishes in its section 142, item III that a trademark registration can be cancelled by forfeiture due to lack of use. The law establishes an administrative procedure in which interested third parties can request that a registered owner provides evidence to the Brazilian Patent and Trademark Office (INPI) that the trademark in question is being used.
 
This administrative cancellation action due to non-use is elaborated in section 143 of Law #9,279/1996. This section establishes that a registration will be forfeited on the request of any person with a legitimate interest, if, after five years from its grant, on the date of such request: (a) use of the trademark has not started; (b) use has been interrupted for more than five consecutive years; or (c) the trademark in question has been used for more than five years with a substantial modification in its distinctive character—when compared with the trademark actually granted by the INPI, according to the corresponding certificate of registration.
 
Section 143, first paragraph, establishes that the trademark will not be cancelled where the owner provides legitimate reasons for non-use. Section 143, second paragraph, sets out a 60-day term for the owner to provide evidence that the trademark at stake is actually in use.
 
The INPI gives preference to the use of invoices, depicting the sign exactly as it was granted by the INPI, as proof of such trademark use. This means that composite and device trademarks must have their figurative elements clearly reproduced in the evidence provided to the INPI. The INPI also allows the trademark owner to present advertising material, provided that it bears the date of publication, which must be within the five-year period within which the registrant must prove that the trademark was in use.
 
Regarding the expression ‘legitimate interest’ (the main provision of section 143), INPI understands that a legitimate party is anyone who holds a trademark application that is likely to be blocked by the senior trademark registration that may be attacked by the forfeiture request.
 
Special exception
 
Section 143, first paragraph, provides for a special exception to the general obligation of the registrants to use their trademarks. The LPI establishes that the trademark will not be forfeited where its owner was not using it for legitimate reasons. This provision is of special interest for the pharmaceutical industry, since it is a heavily regulated area and a pharmaceutical trademark may not be in use due to reasons beyond its owner’s control.
 
A trademark owner is often unable to launch its product in the market due to delays in the issuance of the corresponding marketing approval (in Brazil it can take more than a year). A pharmaceutical company may also file its trademark during the early stages of research and development of its product, so it may take years until the registrant can market its product. Such delays are clearly envisioned by the safe harbour provision.
 
Pharmaceutical companies are sometimes forced to take products out of the market which were previously approved by the regulatory agency. For example, this occurred in the case of thalidomide, commercialisation of which was forbidden in Brazil for some years in the 1960s (due to its teratogenic effects in pregnant women). If the trademark owner is forbidden to trade the product or service covered by the registration, obviously the sign in question cannot be forfeited.

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