Advances in the regulation of medicine pricing and advertising in Paraguay: the emphasis on transparency and consumer protection

Viviana Cervieri
Cervieri Monsuárez, Montevideo
vivianacervieri@cmlawyers.com.uy

Jesús Urbina
Cervieri Monsuárez, Montevideo
jurbina@cmlawyers.com.py

Lucía Arimón
Cervieri Monsuárez, Asunción
larimon@cmlawyers.com.py

Romina González
Cervieri Monsuárez, Asunción
regulatoriopy@cmlawyers.com.py

Introduction

The regulation of medicine pricing and advertising in Paraguay plays a crucial role in protecting access to essential treatments and ensuring transparency of the information provided to consumers. Both regulatory areas fall under the authority of the National Directorate of Health Surveillance (Dirección Nacional de Vigilancia Sanitaria or DINAVISA).

With regard to pricing, the Ministry of Public Health and Social Welfare (Ministerio de Salud Pública y Bienestar Social or MSPyBS) has established criteria to ensure that costs are reasonable and aligned with market conditions. In the case of medicine advertising, the aim is to prevent the dissemination of misleading information and to ensure that messages directed to the public are clear, truthful and reliable.

This analysis addresses the progress and challenges in regard to the regulation of medicine pricing and advertising in Paraguay, highlighting the importance of transparency in the pharmaceutical market and the need to ensure agile and efficient management of such practices.

The regulation of medicine pricing and advertising in Paraguay

In Paraguay, medicine pricing is managed by the DINAVISA, specifically through its Pricing Unit. This body is responsible for evaluating and approving dossiers related to the pricing of pharmaceutical products, whether for new sanitary registrations, new presentations or price updates. These regulations are intended to ensure that prices are fair and reasonable for consumers, promoting a transparent and balanced market.

The regulation applies not only to new products, but also to those that have undergone modifications in their composition, presentation, origin, exchange rate or tax burden. The legal framework concerning this regulation is provided by Articles 263 and 266 of Law No. 836/80, known as the Health Code,^[1] which stipulates that the MSPyBS oversees the market, periodically specifying which drugs may be marketed and setting their prices.

Within this context, Decree No. 20.996/1998^[2] establishes the procedures for setting medicine prices, providing a framework for the thorough oversight of pharmaceutical product costs. Under this regulation, the DINAVISA is empowered to evaluate each pricing request based on technical and economic criteria, ensuring that prices are reasonable and aligned with local market conditions.

A significant step forward in this process is the DINAVISA’s recent Resolution No. 174/2024,^[3] which introduces a new retail price setting (RRP) system.

The RRP system is based on official sources of international reference prices, using as a benchmark those countries with regulatory standards equivalent to or higher than those in Paraguay, and establishes two methodologies for price setting: (1) for innovative products, the price is determined based on the free on board (FOB) value in the country of origin and (2) for similar medicines, the price is set based on regional references, with a maximum of 80 per cent of the price of the innovative medicine or the first similar product established in the country. Additionally, mechanisms for price updates are included, which may be applied based on the consumer price index (CPI), provided that the cumulative increase is at least five per cent compared to the last established price. Alternatively, adjustments may also be made based on an increase in the FOB price, as long as the cost increase in the place of origin is properly justified.

This system aims to promote more equitable regulation aligned with international best practices, strengthening transparency and competitiveness in Paraguay’s pharmaceutical market, while ensuring consumer access to essential medicines at fair prices.

Medicine advertising: binding regulations in Paraguay

Pharmaceutical advertising in Paraguay is regulated to protect consumers from misinformation and misleading information. Law No. 1.334/98 on the defence of the consumer and user^[4] provides that any advertising that misleads as to the features, quality, origin, price or properties of a product shall be considered deceptive and, therefore, is prohibited.

Moreover, the regulation prohibits comparative advertising when unfounded claims are used to present a product as superior to another without sufficient supporting evidence. This rule aims to prevent unfair commercial practices, thereby protecting both fair market competition and consumer rights.

According to the current regulation, namely Resolution No. 286/2023,^[5] all advertising for medicines must be authorised by the DINAVISA prior to its publication and must comply with the information contained in the product’s sanitary registration documents. It should be noted that although the advertising authorisation process is almost immediate, it is not yet carried out digitally, which means that there are certain procedural time delays in regard to the promotion and advertising of medicinal products due to the manual processes used.

The advertising regulations apply to print, radio, television/audiovisual media, live mentions, outdoor advertising (billboards), all media or communication platforms, websites and social networks. The use of testimonials or claims suggesting unproven therapeutic properties is not permitted. Likewise, the inclusion of health warnings is mandatory, when applicable.

Likewise, advertisements should contain clear messages on the product’s responsible use, avoiding any type of encouragement in regard to excessive or inadequate consumption. Advertising control is carried out through inspections and monitoring of the media, with sanctions established for those firms that do not comply with the regulations.

Regarding advertising on digital platforms, the DINAVISA has begun to develop specific guidelines to regulate promotions on social networks and websites. This measure responds to the growth of e-commerce and the need to protect consumers from potentially misleading or unauthorised information.

Conclusion

The regulation of medicine pricing and advertising in Paraguay, under the supervision of the DINAVISA, reflects a commitment to transparency, fairness and consumer protection.

The implementation of a price-setting system based on international references, along with the recent regulatory update, aims to ensure access to essential medicines at fair prices, in line with global best practices.

Regarding advertising, the current regulations ensure protection against misinformation and deceptive practices, promoting ethics and responsibility in pharmaceutical product communications. However, challenges remain, such as the need for digital modernisation of the advertising authorisation process, which underscores the importance of moving towards more efficient regulation in line with market demands and evolving technology.

Notes