Cannabis and IP: Nurturing innovation in Brazil’s life sciences industry

A reticent patent office and complex legal picture make getting IP protection of treatments based on the lucrative plant tricky, explain Priscila Kashiwabara and Luan Scalzitti of Kasznar Leonardos.

The cannabis industry has experienced increasing recognition, mainly due to its versatile applications. Due to the pharmaceutical properties of medical cannabis (or medical marijuana), many countries have legalised its use.

The cannabis plant contains more than 100 different chemicals, known as cannabinoids. Delta-9-tetrahydrocannabinol (THC) and cannabidiol (CBD) are the main relevant chemicals used in medicine.

The global medical cannabis market size reached USD $31.8 billion in 2022 and is expected to reach $57.4 billion by 2028 with a compound annual growth rate (CAGR) of 10.34% from 2022 to 2028 (Medical Cannabis Market: Global Industry Trends, Share, Size, Growth, Opportunity and Forecast 2023 – 2028). In Brazil, according to a report by Kaya Mind (a business intelligence company focused on cannabis in Brazil), the market could yield R$ 917.2 million ($193.6 million) in 2024.

Intellectual property rights are crucial for innovative industries, and this is no different for cannabis companies. They are intended to attract and protect investments in research and development, allowing ongoing innovation, thus enhancing competitiveness through licensing and strategic collaborations, and ensuring legal recourse against unauthorised use, maintaining a fair market.

By securing their rights, businesses can take legal action against infringement, safeguarding their innovations and contributing to a competitive industry.

As more research regarding the pharmaceutical properties of THC and CBD is carried out and the industry continues to grow, the importance of IP protection becomes more evident. In view of this, it is not surprising that innovators have been filing increasing numbers of patent applications related to cannabis.

As shown in the figure below, there has been an increase in the number of PCT applications related to cannabis. In Brazil, the same pattern is observed before the Brazilian PTO (BR PTO).

Source: PatSnap search for PCT applications in IPC class A61 with the terms ‘cannab*’ or ‘marijuana’ or ‘CBD’ in claims.

Source: BR PTO database search for BR applications with the terms ‘cannabis’ or ‘maconha’ in title or abstract.

Medical cannabis research is very often applied research with commercialisation as the goal. Brazil has been witnessing advances in the use of cannabis for treating a plethora of medical conditions, as well as increases in investments in the field as from 2019 and 2020, when the ANVISA (equivalent to the US Food and Drug Administration) resolutions RDC 327 and 335 entered into force and introduced relevant changes in the possibility of medical use of cannabis in the country. 

Therefore, it is advisable for companies to strongly consider the protection of IP assets, including but not limited to trademarks, patents, and plant variety protection.

Rules for approval

Until 2021, patent applications related to cannabis faced a more difficult environment in Brazil. Up to that year, the now revoked section 229-C of the Brazilian IP Act 9,279/96 established the need for approval by ANVISA for the grant pharmaceutical patents (including biotechnological inventions) prior to the Brazilian Patent Office’s (BRPTO) substantive examination.

This section imposed serious obstacles to the issuance of pharmaceutical patents whenever the Brazilian Public Health System considered the object of the application as being of public health interest or included within a list of prohibited substances set forth in Ordinance 344/1998.

As a consequence, applications related to cannabis used to be removed from the active records as the prior consent was usually denied. Therefore, with the revocation of section 229-C in 2021, both domestic and international pharmaceutical companies, including those on the cannabis market, are finally free of ANVISA’s intervention in the prosecution of pharmaceutical patents.

Patents in Brazil can be obtained for several subject matters, among which are cultivation methods, extraction processes, formulations, novel uses, and other inventions that meet the criteria of novelty, inventive step, and industrial application.

When the intended use is health-related, it is important to highlight that the BR PTO currently has a quite restrictive take on patentability of new medical uses of known substances.

Specifically, according to the current guidelines, for an invention directed to a novel use of a known compound to be considered new, it must involve the use of such product to treat or prevent a disease that is different from the one from its previous uses.

Characteristics such as the therapeutic scheme, dosage, administration route, and patient group do not add novelty to the known use of a compound.

When considering inventive activity in new medical use inventions, several aspects come into play as, eg, the compound's mechanism of action for the new use should not be deduced from its existing medical use mechanism, the new use must target a disease with a distinct etiology from the prior art, known adverse effects from prior art cannot support a new use claim, and treating the same symptom of a different disease does not qualify as a new use.

It is important to note that whole or parts of plants and biological materials found in nature – even if isolated from it, or synthetically produced with naturally occurring counterparts, with no way to distinguish them from natural ones—are considered natural biological products.

Such subject matter is not eligible to patent protection. Essentially natural biological processes (eg, crossing and pollination) are also not considered inventions. However, processes that contain at least one technical step that has a decisive impact on the final result and that cannot be carried out without human intervention are considered inventions.

In this sense, for instance, processes using transgenic plants or plant breeding with marker-assisted selection could be potentially protected, in view of the level of human intervention.

In view of the exclusion from patentability of plants, one other important aspect of intellectual property rights related to cannabis is plant variety protection, which hold particular importance in the cannabis industry as breeders invest significant efforts into developing new and distinct cannabis varieties.

National Plant Variety Protection Law

Brazil is a signatory of the UPOV 1978, and plant variety protection is available through the National Plant Variety Protection Law (Law No. 9,456/97). The intellectual property rights for plant varieties are protected through the granting of a plant variety protection certificate. This certificate is considered a movable asset with legal implications and is the only form of protection that can prevent the unauthorised reproduction or multiplication of plants or their parts in the country.

Once protected, third parties are prohibited from engaging in commercial production, offering for sale, or commercialising propagating material of the protected plant variety without the authorisation of the rights holder.

In Brazil, plant varieties are eligible for protection if they meet the following criteria:

• belonging to a species eligible for protection in Brazil with directives for Distinctness, Uniformity and Stability Tests (DUS) published by the National Service for Plant Varieties Protection (SNPC).
• having not been commercially traded abroad for more than four years, or more than six years in the case of grapevines or trees.
• having not been commercially traded in Brazil for more than 12 months.
• having an appropriate denomination that identifies them.

Regarding cannabis, however, to date, the SNPC has not yet published the required DUS for cannabis varieties. In this connection, in case there is interest in protecting cannabis varieties, it is necessary to file a request for the publication of such a document beforehand.

A global challenge

The evolving legal and regulatory complexities surrounding cannabis, both globally and within specific jurisdictions like Brazil, may pose challenges to global cannabis innovation.

Intellectual property protection for cannabis-related inventions is subject to national laws, meaning strategies employed in one country may not automatically translate to another. Businesses operating internationally must consider the intellectual property landscape of each target market.

To navigate the evolving intellectual property landscape, businesses within the cannabis industry should prioritise staying informed about the latest developments, regulations, and legal precedents.

It is essential to engage legal professionals who specialise in intellectual property and possess a comprehensive understanding of the intricacies surrounding cannabis law. These experts can guide businesses in developing tailored intellectual property strategies that align with their specific goals and circumstances.

Looking to the future, the outlook for intellectual property in the cannabis industry appears promising. Advancements in research and development continue to drive innovation and uncover the potential of cannabis for various applications. As scientific understanding of the plant and its components deepens, new opportunities for intellectual property protection emerge.

Priscila Kashiwabara is a partner, biologist and head of life sciences at Kasznar Leonardos. She can be reached at: priscila.kashiwabara@kasznarleonardos.com

Luan Scalzitti is a pharmacist and patent specialist at Kasznar Leonardos. He can be reached at: luan.scalzitti@kasznarleonardos.com