A new technical note from Brazil’s Ministry of Health (MoH) sets out a more structured approach to valuing technology transfers in Productive Development Partnerships (PDPs), aiming to improve transparency, accountability, and legal certainty in one of the country’s key industrial health-policy tools.
Brazil’s Ministry of Health has presented a consolidated account of measures taken to respond to determinations from the Federal Court of Accounts (TCU) concerning the governance of Productive Development Partnerships (PDPs). The document, Technical Note No. 14/2026-DECIS/SCTIE/MS, should be understood in the context of a broader regulatory process that began with Informative Note No. 17/2025, which first established methodological criteria for pricing technology transfer in PDPs.
While Note 17/2025 introduced the substantive pricing framework, Technical Note No. 14/2026 consolidates these criteria, formally records their development and validation, introduces additional operational detail and presents them as part of the Ministry’s compliance with TCU determinations.
At the center of the note is a long-standing issue in Brazil’s PDP policy: how to calculate the value of technology transfer, including know-how, in arrangements where private companies supply strategic health products while transferring production and regulatory capabilities to public laboratories. The TCU had required the Ministry to establish clearer criteria and methodologies for determining that value, including for purposes such as contractual penalties, reimbursement, and risk allocation.
The Ministry’s response is not to impose a single pricing formula for every partnership. Instead, the technical note consolidates a structured methodology designed to make the composition of PDP prices more transparent and auditable. In this respect, the document does not introduce an entirely new pricing logic, but rather formalizes and systematizes a model that had been structured and publicly disclosed in 2025.
The document emphasizes that each partnership may have different characteristics depending on the technology involved, especially when comparing chemically synthesized medicines, biologics, vaccines, blood products, and medical devices.
A key premise of the model is that supply and technology transfer are inseparable in a PDP. According to the note, a PDP is not merely a procurement contract and not merely a pure technology-transfer agreement. It is a hybrid policy instrument in which the private partner’s supply of the product and the gradual internalization of technology by the public partner operate together. Removing one of those elements would alter the legal and economic nature of the arrangement.
The methodology decomposes the PDP price into two major components: the manufacturing, identified as F, and a broader category of remuneration for expenses associated with the execution of the PDP, including technology transfer, identified as BDI (Indirect Benefits and Expenses).
PDP Price = F + BDI
The manufacturing component (F) covers the production and delivery of product to the public partner. It includes inputs such as raw materials, packaging, direct labor, utilities, quality control, manufacturing overhead, logistics, taxes connected to production, and the operational margin on supply.
Beyond its analytical function, this decomposition is intended to serve as a contractual and regulatory tool. By separating supply from technology-transfer components, the model provides a structured basis for auditing prices, negotiating agreements, and calculating indemnification in cases of early termination or incomplete technology transfer.
The BDI component is where the note introduces the most detailed framework. It includes indirect costs, taxes, contribution margin for the public producer, training, regulatory development, technology licensing during Phase III, and valuation of the technology for definitive assignment. In simplified form, the model breaks BDI into the following elements:
BDI = CI + T + MC + Ca + D + L + Ce
Where:
• CI – Indirect Costs
• T – Tax Costs
• MC – Contribution Margin for the Public producer
• CA – Training and Capacity Building
• D – Regulatory Development
• L – Technology Licensing
• Ce – Valuation of Technology for Definitive Assignment
This decomposition is intended to serve several purposes. First, it allows public authorities and control bodies to distinguish between the price of product supply and the value of the technology-transfer package. Second, it creates a more objective basis for negotiating contracts. Third, it supports future calculations of reimbursement or indemnification if a PDP is terminated before the technology transfer is completed.
The technical note also makes clear that the overall PDP price must remain compatible with prices practiced in Brazil’s public health system, the SUS. In other words, the PDP price must be equal to or lower than the average price practiced within the SUS, calculated in accordance with Normative Instruction SEGES/ME No. 65/2021.
One of the most significant parts of the document concerns the distinction between components that may fluctuate over the life of the partnership and those that should remain stable. The manufacturing or supply component may vary according to market prices. Indirect costs and taxes may also vary proportionally. By contrast, the contribution margin, training, regulatory development, licensing, and definitive assignment components are treated as more stable elements, generally defined ex ante.
The note further adds specific reference ranges for two particularly sensitive items: Technology Licensing (L) and Valuation of Technology for Definitive Assignment (Ce). These are also the components in which intellectual property-related assets are most directly concentrated, since they concern the temporary use and, ultimately, the definitive transfer of the technology package, including technical documentation, regulatory know-how, dossiers, and IP rights or licenses where applicable. While Informative Note No. 17/2025 had already identified these components as part of the PDP pricing structure, the 2026 note now provides numerical benchmarks for chemically synthesized medicines: 3% to 7% of net sales for L and 8% to 15% for Ce.
The issue of termination receives particular attention. The proposed model seeks to avoid both overcompensation and unjust enrichment. Manufacturing payments are tied to units supplied and generally would not be reimbursed after supply occurs. Indirect costs and taxes are treated as non-reimbursable because they are not easily individualized. Training and regulatory-development costs are also described as gradual and cumulative, making reimbursement difficult in ordinary circumstances. Licensing (L), in turn, is treated as remuneration for the temporary and conditioned use of the technology during the PDP, and therefore should not be reimbursed once the corresponding use has occurred.
The most important reimbursement issue concerns the Valuation of Technology for Definitive Assignment (Ce). Unlike L, Ce relates to the definitive and irrevocable transfer of the technology package, which is only fully completed at the end of the PDP. This package includes the transfer of technical and industrial documentation associated with the dossier or clone registration, productive and regulatory know-how, specifications, methods, critical parameters, non-opposition commitments, guarantees of autonomy for registration and post-registration activities, and the transfer or appropriate licensing of IP rights, where applicable. Because this value is paid progressively through product purchases but corresponds to a transfer completed only at the end of the partnership, reimbursement may be appropriate if the PDP is terminated early or if technology transfer is not completed. In that case, reimbursement would be calculated proportionally, based on what had already been paid before interruption.
Beyond pricing methodology, the technical note highlights that the Ministry has already implemented a series of governance and transparency measures aimed at strengthening the PDP program.
These include the launch of a digital PDP Panel in July 2025, providing centralized and publicly accessible information on partnerships; the creation of a dedicated working group responsible for developing monitoring and evaluation mechanisms; and the ongoing development of performance indicators and evaluation reports, as well as an institutional study by IPEA expected in 2026.
These initiatives indicate that the pricing model is being embedded within a broader institutional architecture, designed to improve traceability, accountability, and continuous oversight of PDPs.
A key forward-looking element of the technical note is the indication that a complementary regulation is expected to be issued by July 2026. This future norm is intended to incorporate the pricing methodology, monitoring mechanisms, and governance improvements into the formal regulatory framework governing PDPs, currently structured under Portaria GM/MS No. 4.472/2024.
This signals a transition from methodological guidance to binding regulatory standards, with potential implications for contract structuring, cost transparency requirements, auditability, and the legal enforceability of indemnification mechanisms related to technology transfer.
Taken as a whole, the note represents an effort to move PDP governance toward a more disciplined and auditable model. What began with Informative Note No. 17/2025 as an attempt to define pricing criteria is now evolving into a structured and institutionalized framework, aligned with TCU oversight and supported by concrete implementation measures.
With the expected issuance of a complementary regulation in 2026, the current model is likely to become formally embedded in the legal regime governing PDPs, reinforcing transparency, accountability, and legal certainty - while also increasing the level of scrutiny applied to pricing and technology-transfer arrangements.
This section gives quick answers to the most common questions about this insight. What changed, why it matters, and the practical next steps. If your situation needs tailored advice, contact the RNA Law team.
Q1: What is the purpose of Technical Note No. 14/2026-DECIS/SCTIE/MS?
A1: It consolidates and records the development and validation of PDP technology-transfer pricing criteria and presents them as part of the Ministry of Health’s compliance with TCU determinations.
Q2: How does the methodology define the PDP price?
A2: It decomposes the PDP price into manufacturing (F) plus BDI (Indirect Benefits and Expenses): PDP Price = F + BDI.
Q3: What elements make up BDI in the model?
A3: BDI is broken into CI (Indirect Costs), T (Tax Costs), MC (Contribution Margin for the Public producer), CA (Training and Capacity Building), D (Regulatory Development), L (Technology Licensing) and Ce (Valuation of Technology for Definitive Assignment).
Q4: What benchmarks does the note provide for licensing and definitive assignment?
A4: For chemically synthesized medicines, it provides reference ranges of 3% to 7% of net sales for Technology Licensing (L) and 8% to 15% for Valuation of Technology for Definitive Assignment (Ce).
Q5: How does the note address reimbursement if a PDP is terminated early?
A5: It generally ties manufacturing payments to units supplied and treats indirect costs and taxes as non-reimbursable; the main reimbursement focus is Ce, which may be reimbursed proportionally if the PDP ends before definitive transfer is completed.
Q6: What further regulatory step is expected after the technical note?
A6: The note indicates a complementary regulation is expected to be issued by July 2026 to incorporate pricing methodology, monitoring mechanisms and governance improvements into the formal PDP regulatory framework under Portaria GM/MS No. 4.472/2024.
