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Public procurement preference margin
On 3 April 2012, the Brazilian government decided in Decree no. 7.713 to apply a margin of preference of 8% to 25% for the public procurement of nationally produced pharmaceutical drugs and biological medical products.
This means that a domestic producer will be preferred by the government if the contractor offers a price that is within the range of the lowest bid by a foreign company plus the preferential margin. Brazil's preferential margins scheme was introduced by Law no.12.349/2010 in the realm of the Plano Brasil Maior, i.e., Greater BrazilPlan (see Related Measures).
The decree stipulates that medical drugs of national or partial-national production have a margin of preference of 20%, while medications that are still being developed or that are soon going to be produced received a margin of 8%. There is also an additional margin of 5% for products that are based on domestic technological development and innovation.
The measure, Decree no. 7.713, came into power on 4 April 2012. The effective periods vary depending on the group of products:
On 3 April 2014, Decree no. 8.225 extended the period for products belonging to group 1 until 31 December 2015, starting 30 March 2014.
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