The Brazilian patent system is approaching a turning point. Five years after the Federal Supreme Court (STF) struck down the sole paragraph of Article 40 of the Brazilian Patent Statute during the trial of Constitutional Challenge No. 5529 (ADI 5529), stakeholders are still grappling with the unresolved consequences of that decision.
The ruling eliminated the mechanism that safeguarded patent owners against losses resulting from excessive delays. However, no alternative mechanism was introduced, fuelling growing litigation, legal uncertainty, and an increasingly urgent debate over patent term adjustment (PTA).
ADI 5529 and then what?
Before ADI 5529, Article 40 provided an important safeguard against excessive patent examination delays by ensuring that patents would remain in force for at least ten years from grant whenever examination exceeded a decade. In 2021, the STF declared that mechanism unconstitutional, concluding that the resulting variability in patent terms could affect legal certainty and competition. The decision was applied retroactively to pharmaceutical patents, leading the Brazilian patent and trademark office to reduce the terms of protection of 3,341 patents.
However, while ADI 5529 eliminated the existing mechanism, no alternative framework was introduced to address the effects of prolonged administrative delays in patent examination. As a result, patents may be granted after much of their commercial value has already been lost.
This outcome is difficult to reconcile with the constitutional objective of promoting innovation. In sectors such as pharmaceuticals and biotechnology, where R&D requires substantial investment, companies rely on a meaningful period of patent exclusivity to justify investment and market entry. When administrative delays significantly erode that period and no compensatory mechanism exists, the practical value of a patent is diminished, potentially affecting the willingness of innovative companies to introduce new technologies into Brazil.
Courts have become the temporary arena
In the absence of legislative action, patent owners have turned to the judiciary to seek compensation for their losses. Since the ADI 5529 decision, more than 100 lawsuits seeking PTA-like remedies have been filed, based on broader legal principles such as state liability, the reasonable duration of administrative proceedings, and the duty of administrative efficiency.
To date, only a few decisions have recognised that excessive delays may give rise to compensable harm. Most of the rulings have been unfavourable to patent owners, adopting the rationale that ADI 5529 allegedly foreclosed any form of compensation for delays in patent examination. This interpretation, however, appears difficult to reconcile with the reasoning adopted by the STF, which was directed at the automatic and indiscriminate nature of the former mechanism.
In any case, judicial intervention remains an imperfect solution. Courts are being asked to address, on a case-by-case basis, a systemic problem that affects the functioning of the patent system as a whole.
But what about the National Congress?
The growing number of legislative initiatives under discussion in the National Congress demonstrates an increasing recognition that the elimination of the former mechanism left an important gap in the Brazilian patent system.
The following bills all seek, in different ways, to introduce mechanisms capable of compensating patent owners for administrative delays:
Bill 2210/2022;
Bill 2056/2022;
Bill 1471/2023;
Bill 5810/2025; and
Complementary Bill 32/2026.
They are based on a common premise: patent owners should not bear the consequences of excessive delays caused by the state.
Importantly, these proposals do not seek to recreate the former system. Rather, they aim to establish a more tailored and predictable framework capable of distinguishing between ordinary examination periods and unreasonable delays attributable to the state. In doing so, they reflect the same principle increasingly invoked by patent owners before Brazilian courts: when the public administration fails to complete examination within a reasonable period, the resulting loss of effective patent term should not fall exclusively on the innovator.
Therefore, a statutory PTA framework would provide a more transparent, predictable, and efficient solution, reducing legal uncertainty while ensuring that patent protection continues to serve its constitutional function of fostering innovation.
A contrasting proposal: Bill 3676/2026
Against this backdrop, Bill 3676/2026 moves in precisely the opposite direction: it proposes a reduction in the protection term of patents in the pharmaceutical field. By creating a distinct regime for pharmaceutical patents, the proposal raises important questions regarding Brazilian innovation policy and its international obligations.
The proposal is particularly difficult to reconcile with the reality of patent prosecution in Brazil. Pharmaceutical patent applications have historically faced some of the longest examination periods, frequently consuming a substantial portion of the 20-year patent term counted from the filing date.
It also raises concerns under Article 33 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), which provides that patent protection “shall not end before the expiration of a period of twenty years counted from the filing date”. At a minimum, any legislative initiative would require careful scrutiny in light of Brazil’s international commitments and the principle of non-discrimination embodied in the international patent system.
Therefore, if approved, the proposal would send a troubling signal to innovative industries. At a time when Brazil is debating how to best compensate for excessive examination delays, reducing the protection term for pharmaceutical inventions would move in the opposite direction, potentially discouraging investments in the Brazilian market.
A modern patent system requires a modern PTA mechanism
The debate should no longer be whether Brazil needs a mechanism to address excessive delays but what form that mechanism should take. A well-designed PTA regime would adopt transparent, predictable, and proportionate criteria to compensate for delays, while preserving legal certainty. Such framework would be fully consistent with the rationale underlying ADI 5529.
Innovation depends on a patent system that is both predictable and effective. By eliminating the former safeguard without establishing a replacement, Brazil left unresolved a fundamental question: who should bear the cost of excessive delays – the state or the innovators who have no control over them? Five years after ADI 5529, that question remains unanswered. The time has come for the National Congress to adopt a mechanism capable of restoring confidence in the innovation ecosystem.
