New Brazilian legislation on civil liability for adverse Covid-19 post-vaccination events
Angela Kung
Pinheiro Neto Advogados, São Paulo
Luciana Mayumi Sakamoto
Pinheiro Neto Advogados, São Paulo
Isabela Barbosa Sampaio
Pinheiro Neto Advogados, São Paulo
Théra van Swaay De Marchi
Pinheiro Neto Advogados, São Paulo
Anna Luiza Bertin
Pinheiro Neto Advogados, São Paulo
Introduction
The clinical, technical and regulatory challenges of the pandemic have been discussed worldwide over the past year, with the emergency manufacturing and distribution of pharmaceuticals being one of the cornerstones. Across the world, different manufacturers have raced to devise and manufacture vaccines to prevent infection by Covid-19 in record time. However, one of the main concerns of vaccine developers and suppliers lies in the liability for adverse effects undetected during the swift development of the vaccines in an emergency scenario.
In 2020, the United States and Latin American countries issued laws and regulations limiting or exonerating from liability the developers and suppliers of vaccines to prevent Covid-19 infection, in view of the time constraints imposed on manufacturers due to the public interest and urgent need for approval of vaccines.
In Brazil, liability and the ensuing indemnification rights are deemed a matter of public policy, either in terms of consumer protection (individually and/or collectively) and/or where it favours a private party over the Public Administration.
Brazilian legal framework
Under the Brazilian Federal Constitution, the Federal Government, states and municipalities have concurrent authority to provide for healthcare matters and, as such, hold joint liability for vaccination-related damages claimed in court.
Additionally, based on Law No 8,080 of 1990, which regulates the Brazilian Unified Health System (Sistema Único de Saúde or SUS), the Federal Government, states and municipalities are tasked with providing financial, technological, material and human resources for the adequate rendering of healthcare services.
As for liability imputable to manufacturers, both the Brazilian Civil Code and Brazilian Consumer Code could apply in the form of at-fault liability or strict liability. The latter applies regardless of culpability. Generally speaking, when it comes to civil liability, the general rule is at-fault liability; when consumer relations are involved, then strict liability governs. Considering the Covid-19 vaccination context, this article focuses on consumer relations.
Under the Brazilian Consumer Code, Brazilian and foreign manufacturers, producers, builders and importers are subject to joint and strict liability, which means that they are liable for redress of damage caused to consumers by defects resulting from the design, manufacture, construction, assembly, formulation, handling, presentation or packing of their products, as well as by insufficient or inadequate information on the use and risks involved, unless it is evidenced that: (1) they did not place the product on the market; (2) there is no defect; or (3) the case involves exclusive culpability of consumers or a third party.
Therefore, case-by-case analysis is very important in applying civil liability rules in Brazil. Nevertheless, based on the Brazilian Consumer Code, vaccine manufacturers could, in principle, be held liable for any damage and adverse effects derived from vaccination, regardless of evidence of culpability. The very occurrence of damage and the existence of a causal relation would be enough to trigger strict liability.
Considering this scenario and following the trend set by major nations, on 6 January 2021, Provisional Measure 1,026 ('PM 1,026') allowed vaccine supply agreements between public authorities and vaccine developers to establish indispensable clauses, including a partial hold harmless clause related to contractual penalties. On 10 March 2021, PM 1,026 was converted into Law No 14,124 of 2021.
Further regarding the context of Covid-19 vaccines, and in addition to the possibility of negotiating these special indispensable clauses in vaccine supply agreements, Law No 14,125 of 10 March 2021 was enacted to deal with civil liability for adverse post-vaccination events. Under this law, while the Public Health Emergency of National Concern due to the SARS-CoV-2 pandemic endures, the Federal Government, states, Federal District and municipalities in Brazil are authorised to acquire Covid-19 vaccines and assume the risks related to civil liability derived from adverse post-vaccination effects, provided that the National Public Health Agency (Agência Nacional de Vigilância Sanitária or Anvisa) has granted the corresponding registration or temporary authorisation for emergency use.
Moreover, the aforementioned governmental authorities are also allowed to obtain guarantees or take out private insurance, in Brazil or abroad, through one or more policies, to cover the risks dealt with in said law.
Finally, it should be noted that, based on Law No 14,125, the assumption of civil liability risks for adverse post-vaccination effects is limited to the acquisitions made by government authorities.
Conclusion
Considering the exceptional situation that the whole world is coping with and the general rules set out in the Brazilian legal framework (which may not ideally cover all situations that may emerge from the Covid-19 pandemic), Laws No 14,124 and 14,125 provide more legal certainty to vaccine developers in terms of adverse events and civil liability.
The current state of affairs underscores the importance of having a robust body of laws and regulations in place that keep abreast of changes in society and are capable of responding to challenges of all sorts, old and new. To that end, exceptional legislation may be needed to help a country overcome unprecedented legal problems as they arise.