Mexico Health Review 2016

Page 1

2016


“We can no longer avoid the issue of preventive medicine. This is not trivial� Mikel Arriola, Director General of the Mexican Social Security Institute (IMSS)




The year 2016 has been one of change in the Mexican public health sector, highlighted by new leadership and new policies promoting cost-effectiveness and efficiency. Mexico has continued to attract an increasing number of clinical trials and new companies, bringing fresh ideas and scientific innovation. An oncoming wave of patent expirations has further prompted medicinal innovation, with Big Pharma companies racing to discover the next big treatment while others prepare to release life-saving generics and biosimilars. But the country’s most common problems remain: obesity, diabetes and cancer are the top concerns for healthcare providers and the biggest sappers of healthcare budgets, with the public and private sectors increasingly emphasizing the importance of prevention.

The health industry transforms and advances at breakneck speed. Mexico Health Review 2016 offers important insight into the changes to the public system that have occurred over the year, the mind-blowing innovations under development and the growth opportunities the industry presents. Mexico Health Review 2016 is an essential read, packed with interviews with the most relevant industry leaders and analyses of the state of the health sector in Mexico.


ALL RIGHTS RESERVED Š Toguna, S. de R.L. de C.V., 2016. This annual publication contains material protected under International, United States and Mexican Laws and international Treaties. Any unauthorized reprint or use of this material is prohibited. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system without express written permission from Toguna S.A. de C.V. Mexico Health Review is a registered trademark. The publisher has made all reasonable efforts to provide accurate information, and the information contained in this publication is derived from sources believed to be true and accurate. However, the information in this publication should not be considered to be complete or definitive, and may contain inaccuracies or typographical errors. The publisher accepts no responsibility regarding the accuracy of information and use of such information is at your own risk. The publisher will not be liable to any party for any direct, indirect, special or other consequential damages arising out of any use of information in this publication. The publisher provides no representations or warranties, express or implied, including any implied warranties of fitness for a particular purpose, merchantability or otherwise in relation to any information provided by the publisher in this publication.

ISBN: 978-0-9968026-3-5


TABLE OF CONTENTS

1

YEAR IN REVIEW

8

CLINICAL RESEARCH

2

HEALTHCARE SYSTEM

9

INNOVATION & BIOTECH

3

BIG PHARMA

4

BRANDED GENERICS & OTC

5

MEDICAL DEVICES

12

LOGISTICS & SUPPLY CHAIN

6

DIAGNOSTICS & PREVENTION

13

MEDICAL TOURISM

7

DIGITAL HEALTH

14

DOING BUSINESS IN MEXICO & INSURANCE

10 11

AESTHETIC MEDICINE & SKINCARE

NUTRITION & WELLNESS



YEAR IN REVIEW

1

New regulations. New authorities. New opportunities. 2016 has been a year of change and advancement for Mexico’s health industry as public and private healthcare providers look for more efficiency and better processes, pharma companies look to improve and tailor their offerings, with an eye on export possibilities and fastpaced developments in areas like biotechnology, stem-cell research and minimally invasive surgery, while service providers face fresh challenges as government institutions ask for simpler solutions to increasingly difficult issues. Sector players are springing into action over Mexico’s growing obesity and diabetes epidemic, hunting for preventive strategies but also better, less costly treatment options.

State institutions, privately run foundations, regulators, NGOs, researchers, logistics companies and many others are all adding their particular expertise to improve Mexico’s health and take advantage of its welcoming business environment and new regulatory framework, as well as growing tendencies like medical tourism and digital health systems, while waiting for longer-term initiatives like the government’s Private-Public Associations (PPA) that could open new investment opportunities.

5



| CHAPTER 1: YEAR IN REVIEW 8

ANALYSIS: A Year of Deep Changes and Opportunities

10

VIEW FROM THE TOP: Julio Sánchez, COFEPRIS

12

VIEW FROM THE TOP:  Armando Ahued, Minister of Health of Mexico City

14

VIEW FROM THE TOP: Gerry Eijkemans, PAHO & WHO

16

INSIGHT: Isabel Crowley, UNICEF

18

VIEW FROM THE TOP: Miguel Lombera, SMSP

19

VIEW FROM THE TOP: Marlene Llópiz, AMEIFAC

20

VIEW FROM THE TOP: Cristóbal Thompson, AMIIF

22

VIEW FROM THE TOP: José Campillo, FUNSALUD

24

VIEW FROM THE TOP: Roberto Tapia, Fundación Carlos Slim

26

INSIGHT: Laura Magaña, INSP

27

EXPERT OPINION: María Bonilla, World Bank

28

INSIGHT: Marlene Llópiz, AMEIFAC

30

EXPERT OPINION: Julia López, FENIN

31

INNOVATION SPOTLIGHT:  B. Braun Aesculap’s EinsteinVision 2.0

32

EXPERT INSIGHT: José Lixa, Parque TecniA Universidad Anáhuac

32

VIEW FROM THE TOP: Saúl Ancona, SEFOTUR

7


| ANALYSIS

A YEAR OF DEEP CHANGES AND OPPORTUNITIES Mexico’s health sector is evolving into a hub of

efforts to improve third-party review processes and

innovation and quality, driven by a cost-conscious

reduce registration times this year.

private and public sector demanding better and more 8

efficient services and the determination of the country’s

Össur, a medical devices firm headquartered in Iceland,

regulatory agencies to change laws and guidelines.

is one of those betting on Mexico’s technological savvy

Standardized - and easier - compliance requirements

and closeness to large export markets. In an interview

have opened the door to controlling skyrocketing

with Mexico Health Review, Össur’s Site Director Eduardo

costs and reducing medical backlogs, a win-win for the

Salcedo says that aside from Mexican workers’ expertise,

country’s population.

labor competitiveness against manufacturers in Europe and the US are a significant factor helping to keep product

Geographical advantages have also come into play,

prices down.

especially for medical services entrepreneurs, as the country’s proximity to the US and Canada has turned

A LARGE AND DEMANDING POPULATION

medical tourism into a booming business. In the north,

Mexico’s approximately 128 million inhabitants pose a

Monterrey and Tijuana have solidified their position as

business challenge and an opportunity at the same time.

nearby destinations for travelers in need of complex

The vast country presents a complex proposition for

medical procedures at a lower price than at home but with

logistics companies to come up with new ideas to transport

the same quality, while the southern paradises of Cancun

medicines and supplies at low costs and on time, while a

and Merida on the fabled Riviera Maya are attracting

growing middle class is increasing demand for medical

more and more foreign patients with the promise of

treatments as rates of chronic conditions such as diabetes

convalescence by a Caribbean beach.

and hypertension climb. The desire for better health has also led to a rise in demand for access to facilities for

PRESENT AND FUTURE BUSINESS APPEAL

physical exercise, such as health clubs, and a strong focus

But as the number of companies on the outside looking in

on prevention by both the public and private sectors.

increases, so do the ranks of those already in the country setting up shop with an eye to turning Mexico into a base

Around 70 million Mexicans are under the care of the

of operations for endeavors such as clinical research

massive Mexican Social Security Institute (IMSS), a

facilities producing tomorrow’s treatments, large-scale

behemoth operating over 6,000 medical facilities and also

manufacturing both of patented and generic medication

responsible for the livelihood of millions of pensioners.

and cutting-edge manufacturing facilities for prostheses

Mikel Arriola, who for last year’s edition of this book was

that will help people around the world stay active to a

interviewed as the head of COFEPRIS, has taken the

more advanced age.

helm at IMSS with a firm focus on reducing costs. An overweight population of close to 70 percent of adults has

BMI Research, part of the Fitch Group, says in a report on

prompted a culture shift at IMSS to emphasize prevention,

Mexico’s health industry that the Latin American nation

with campaigns targeting changes in eating habits and

is the sixth most attractive pharmaceutical market in

promoting more active lifestyles. “We can no longer spend

the Americas, with projected medication sales of over

80 percent of our budget on 20 percent of the population

US$10 billion in 2016 and US$11.2 billion for next year,

that failed to prevent their health conditions,” Arriola says.

hovering around 0.9 percent of GDP. Mexico’s investment

“If we do nothing, by 2050 we will go from spending MX$80

promotion agency, ProMéxico, forecasts the production of

billion (US$4.2 billion) treating chronic disease to spending

medicines in the country will grow 5.2 percent between

MX$350 billion (US$18.5 billion), which is unsustainable.”

2015 and 2020. The medical devices industry shows even better potential. BMI Research sees a 2014 to 2019

Global organizations such as UNICEF have taken an active

compound annual growth rate (CAGR) of 6.3 percent for

role in helping Mexico deal with nutritional habits and also

the sector. Sales could amount to US$4.3 billion in 2016.

to address the need to help the most vulnerable sectors of

“Market competition will drive prices down and increase

society integrate and develop according to their potential,

access to the latest medical devices,” the firm says. The

looking after children and mothers and working together

Federal Commission for the Prevention of Sanitary Risks

with the authorities to accomplish internationally agreed

(COFEPRIS), it added, will help the industry through

objectives.


And while private hospitals take a large chunk of Mexico’s

and are ready for aesthetic surgery,” says Fernando

out-of-pocket medical expenditures, which represent around

García, Director General of Tijuana Bariatrics, referring

44 percent of the country’s total health expenses, they are

to patients at his specialty clinic just south of the border

also working hard to increase their service offerings in the

across from San Diego, California. The beauty market has

face of better-informed and more demanding patients who

also bloomed. According to the umbrella organization for

are taking full advantage of the Internet information age.

the cosmetic industry CANIPEC, the country has attracted over US$300 million in foreign direct investment annually

PREVENTION ON SIGHT

during the last decade.

The growing population coupled with the increase of chronic diseases has also made Mexican institutions focus

SERVICES AT THE READY

on preventive strategies to stop the spread of maladies

In a fast-moving environment, doctors and hospitals

in their tracks. Institutions like the National Institute of

cannot hope to handle things alone. After the regulatory

Cancerology (INCan) and the National Institute for Public

changes that created more pathways for development of

Health (INSP) are taking a hard look at cancer, the third

medical advances, consultants, law firms and certification

cause of death in the country, with policies like the creation

specialists have taken the lead to guide scientists, medical

of the National Tumor Bank to provide more research

practitioners and entrepreneurs through the legal system

tools for doctors, while companies are looking into more

and toward a faster deployment of modern treatments.

9

effective testing methods. One of the oldest methods of prevention, vaccination, is successfully implemented in

Medical and technology clusters are increasingly becoming

Mexico as some child vaccination rates rank above those

the vehicle of choice for hospitals, manufacturers and

of developed countries like France, with around 98 percent

others to organize and promote regional specialties

of children inoculated against measles.

and helping to come up with unified processes and accreditations that ease concerns for both patients and

AESTHETICS AND BARIATRICS BOOM

industry newcomers. State governments are seizing the

Mexico is the 10th most populous country in the world

opportunity to bring jobs and income to Mexico’s regions

but it is the third most important center for aesthetic

by actively promoting the formation of these aggregates

surgery, trailing only the US and Brazil, according to

of knowledge and innovation.

the International Society of Aesthetic Plastic Surgery (ISAPS). Mexican doctors performed over 4.8 percent of

Mexico is not without challenges. Hypertension, cancer

all surgical aesthetical procedures in the world last year.

and underage pregnancies are at high levels despite the

A relevant portion of these come paired with weight-loss

best efforts of many and the push toward a universal

related procedures such as bariatrics surgery, a specialty

healthcare system. But the sector is increasingly turning

in growing demand by medical tourists. “When a patient

into an example of how discipline, collaboration and

turns to plastic surgery it is because they have already

ingenuity can help guide patients, businesspeople and

reached a point where they have lost 30, 40, 100 kilograms

scientists toward more efficient and modern practices.

RATE OF OVERWEIGHT (percentual) OVERWEIGHT AND OBESITY RATES IN SELECTED OECD COUNTRIES (percent) 75 70

past projection

65

new data points

60 55 50 45 40 35 30 25

1972

1976

Mexico Mexico US US

1980

1984 UK

1988

Australia Australia Canada

1992

1996

2000

Canada France Italy Switzerland

2004

2008

France

2012 Korea

Switzerland

Source: OECD estimates based on national health surveys. UK and weight in Australia, Italy Korea Note: Measured height England, Korea, Mexico and USA; self-reported data in other countries.

Source: OECD estimates based on national health surveys. Note: Measured height and weight in Australia, England, Korea, Mexico and USA; self-reported data in other countries.

2016

2020


| VIEW FROM THE TOP

TECHNICAL AUTHORITY BASED ON SCIENTIFIC ANALYSIS JULIO SÁNCHEZ Commissioner of the Federal Commission for the Protection Against Sanitary Risks (COFEPRIS)

10

Q: How has the current administration contributed

of specialization possible in the Americas. Secondly,

and followed up with existing policies, while creating

COFEPRIS passed the global exam on sanitary evaluation

complementary regulations to increase efficiency?

for vaccine development and manufacturing. By securing

A: Mikel Arriola’s contributions to Mexico’s health policies

these two achievements, COFEPRIS proved that a

have tremendously boosted the industry. When he first

quality management system was put in place, showing

took on the role of Commissioner in 2011, he focused on

an assessment standardization from civil servants in

reducing the registration backlog of the pharmaceutical

Mexico. There should never be different decisions made

industry. Having served as his Chief of Staff, I took on the

on equal applications, which is precisely what our quality

primary duty to improve the efficiency of certification

management systems prevent.

procurement. For example, the pharmaceutical industry accounts

for

4.5

percent

of

Mexico’s

GDP.

Each

Q:

How

will

stringent

regulations

influence

the

pharmaceutical registration for market authorization is

pharmaceutical market and new product development?

worth around MX$1 million (US$53,000). In 2011, we had a

A: The Mexican pharmaceutical industry and COFEPRIS

backlog of close to 30,000 applications.

want to offer the best possible solutions to the population. Our pharmaceutical policy is strengthened

The impact of deficient procedures on the part of the

by our presence as a technical authority whose work

country’s sanitary authority can be enormous on the

is based on scientific analysis. Our professionals have

economy. COFEPRIS’ administrative tasks and legal

science-based backgrounds that allow them to analyze

structure were not properly organized. As such, Arriola

product conditions. We create reliable, rapid, flexible

developed a strategy to minimize certification backlogs

and accessible plans for sanitary authorizations to certify

and modernize the institution’s regulations. We classified

products promptly and create incentives for new product

COFEPRIS’ shortcomings and assigned them to different

developments. COFEPRIS must also remove entry barriers

teams based on their specific nature. Although backlogs

to the Mexican market and we have harmonized our

were a major issue, modernizing our regulations was

protocols to international practices. These points have

equally important. We aimed to align and standardize

established Mexico’s pharmaceutical policies, including

our sanitary practices to those established in first world

the deregulation of certain products.

countries with prominent sanitary authorities. Thereafter, we streamlined our communication with international

There are instances when products were developed by new

organizations,

Health

technologies, giving way to new treatments with a high

Organization (PAHO) and the World Health Organization

technological background. In their natural development

(WHO). We wanted to gather information regarding

process, medical devices are changing and minimizing risk

best international practices, bringing certainty and

levels. Considering the medical device arena is filled with

predictability to our processes, while also establishing

new technologies, COFEPRIS must be aware of their origin

an efficient and rapid authorization protocol. Through

and assess the risk alignment of a specific product.

such

as

the

Pan

American

risk-based analysis, COFEPRIS could ensure quality product releases with ample efficiency, quality and safety

For example in 2012, we found that 1,800 products were no

components.

longer considered medical devices abroad but Mexico still evaluated them as sanitary liabilities. Afterward, we started

COFEPRIS

has

obtained

international

recognition.

deregulating them. The results saw 2,300 deregulated

We have secured the status of National Regulatory

products starting in 2013, reducing COFEPRIS’ regulatory

Authority Regional Reference Level IV through PAHO’s

workload by 16.2 percent. It also freed up over MX$5 billion

drugs and vaccines recognition plan, the maximum level

(US$266 million) in public resources. The most influential


change was incentivizing foreign companies to come to

In terms of medical devices, we imposed sanctions in

Mexico and commercialize their products.

2012, and by 2015, we had eliminated two tons of medical devices that were inappropriate for sale. In 2016, 300

Q: How has COFEPRIS decreased approval times more

million cigarettes and 5 million liters of alcohol were

than Japan, the US and Canada?

removed from sale due to quality issues. COFEPRIS has

A: COFEPRIS’ pharmaceutical policy of broadening

an important economic impact because we regulate

its market access was implemented after in-depth

40 cents out of each peso that is spent on medicines,

planning and strategizing. One of these strategies

beverages, food and cosmetics. If we regulate well, we

recognized previous registrations in foreign sanitary

can generate incentives for the industry to be more

institutions, such as the Food and Drug Administration

efficient and we can create a more competitive market

(FDA), Canada’s Health Products and Food Branch and

with more options.

Japan’s Pharmaceuticals and Medical Devices Evaluation Agency. As a result, COFEPRIS issues the correspondent

The sanitary authorization agencies around the world

registration of medical devices after only 30 working days.

must comply with three important mandates. The first is to

While we are seeing more medical devices in-house, we

provide authorization for products that we review in terms

still monitor them extensively. For instance, in 2015, we

of quality, safety and manufacturing practices and this

disposed of two tons of irregular medical devices that did

is done through market authorization analysis. Secondly,

not follow COFEPRIS’ lines.

we must monitor the quality of the products that are already in the market through market intelligence. Thirdly,

We have created the same equivalence scheme with

we must communicate with the public through sanitary

Europe, Canada, Australia and the US for innovative

promotion. The primary feature in the smooth running of

drugs. New molecule certifications are reduced by 60 to

any sanitary regulation authority is cooperation and we

360 days, improving Mexico’s attractiveness for foreign

want to establish a center of excellence based on the idea

laboratories. In 2011, we developed a plan to analyze all

that technical knowledge is created inside the laboratory.

pharmaceutical patents that were soon to expire and

We want to create a channel wherein all expertise is

those with a bioequivalent application. COFEPRIS aimed

shared. For this reason, COFEPRIS is creating a national

to recognize which similar drugs could be used in Mexico’s

laboratory of sanitary sciences. We will form a number

healthcare system, lowering costs and budget allocation

of strategic alliances, one of which will be with UNAM's

in the public sector. The value penetration of the generic

Faculty of Sciences and the other will be with CONACYT.

market in Mexico shifted consequently, so that in 2011, 52

This will allow us to stay up to date and share information

percent of the market was attributed to generics. In 2016,

with institutions around the world.

that number grew to 82 percent. We have moved from 36 generic substances to 491 options derived from the former. Q: How do you plan to increase restrictions and regulations of miracle products and nutritional supplements? A: We have to maintain the strictest standards in reviewing and analyzing all the products in our market so that we can ensure the patient is given access to quality products. In the last few years, so-called miracle products have caused problems because advertising regulations for these products failed to account for the fact the media was also partly responsible for advertising campaigns. Advertising of all other products was subject to regulation and we had the ability to impose sanctions for non-compliance. Essentially, there was no requirement by miracle product suppliers to demonstrate to the media that the product was legitimate. From 2012 onward, there was a significant change in terms of the way the advertising was regulated. The advertising media is now obliged to seek a permit. We were also able to impose sanctions that were 400 times more powerful than we had before. We then began to see this advertising reduced in the space of six months.

Sanctions eliminated two tons of medical devices

that were inappropriate for sale, 300 million cigarettes, and 5 million liters of alcohol due to quality issues

in 2016

11


| VIEW FROM THE TOP

HOUSE CALLS FOR THE PREGNANT AND SICK ARMANDO AHUED Minister of Health of Mexico City

12

Q: Last year we talked about maternal mortality rates

to the huge impact it is having. This year we have been

and “Médico en tu Casa”. How are things coming along?

buying vehicles and other necessary equipment. The

A: The “Médico en tu Casa” program is almost 2 years

remainder of the money will be used to employ more

old and emerged as a response to maternal and infant

doctors and nurses so we can reach more people. It will

mortality. Many had never received antenatal care. Today,

survive the budget cuts because it is part of the law in

we have more than 8,500 pregnant women who had not

Mexico City, which means it is not subject to the whims of

been to a single session of antenatal care and 40 percent

incoming ministers. It is an obligation of the government

of those had high-risk pregnancies, that is to say their

and the local institutions.

lives were at risk. Most of those were children 11-14 years old. I can now say 93 percent of those women have given

There also are many doctors that work full time in this

birth with no deaths. This is due to us going to their

program, which gives it sustainability. There are 10,000

houses and administering prenatal and antenatal care

medical students participating in the “Médico en tu

and taking them to hospital when needed. If we keep

Casa” program and there are nurses, psychologists,

waiting until emergency obstetric care is needed, many

odontologists and social workers working as trainees and

women will surely continue to die.

practitioners. It is a great force with qualified personnel and is also helping train professionals with a greater

Why do you think many women have never received

sense of solidarity and humanitarian and vocational

antenatal care when the free clinics are open from 8am

understanding. These students come from 17 universities.

to 8pm and hospitals are open 24 hours? The services

Three are public, IPN, UNAM and UAM, and 14 are private,

are free and accessible. It is because there is no health

such as La Salle, Anáhuac, ITESM, the Panamericana,

education and women are not conscious that they have

Westhill and Iberoamericana colleges. These students

to take care of themselves and go to antenatal care.

learn lessons that cannot be taught in the classroom, in

We have not educated and made people responsible

the health center or the hospital. They learn in patients’

for looking after their health and we have not taught

homes, interacting with patients. Seeing how they live

people about sexual and reproductive health. When we

becomes decisive for health. It reminds them that people’s

ask children 11-13 years old in their seventh month of

health and sickness depends on the conditions in which

pregnancy why they did not go to antenatal care, they

they live, whether they have running water, plumbing, a

say it is because they did not think about going.

refrigerator and safe water to drink in their houses.

We need to create this consciousness, avoid child and

Q: What are the main challenges in terms of implementing

teenage pregnancies and work extensively on health and

this in other cities in Mexico or internationally?

sexual health education. Through the “Médico en tu Casa”

A: It is implemented in almost nine states, it has been

program we have visited over 2.5 million homes, we have

signed in eight states: Michoacan, Sinaloa, Chihuahua,

found over 200,000 people in vulnerable conditions,

Durango, Tlaxcala, Tabasco, Chiapas and Nuevo Leon.

almost 175,000 elderly adults who cannot leave their

Jalisco has done something similar. They call it “El

homes and almost 1,900 bedridden people in terrible

Médico en tu Barrio” but it is almost the same model.

conditions.

Internationally, it has been adopted by Kuwait, Dubai and will soon be adopted by Paris, Madrid, Ukraine,

Q: What level of investment is needed for a program

China and Cuba, which already has a similar model but

such as this?

they really liked the work we were doing, Bogota and

A: This year it was priced at MX$170 million (US$9 million),

Medellin, Guatemala, Panama, Buenos Aires, Santiago de

which may seem high but in reality is not when compared

Chile, Peru, Ecuador, Dominican Republic and Costa Rica.


We have agreements in place with five US universities:

métete en cintura” (move and get yourself in shape). We

University of Philadelphia, University of Washington,

are giving zumba and physical activity classes in many

Harvard University, University of San Francisco and soon

places, we implemented squats in the Metro, the Ecobici

the University of Miami.

program, free gyms in public spaces so that people can exercise outside, we are increasing the number of indoor

Q: What has been the key to your success?

gyms, taking salt shakers out of restaurants, we are in the

A: The key has been daring to change the paradigm of

midst of reducing the sugar in sweet bread by 10 percent

medical attention, having gone to knock on doors instead

and the theme of soda in schools is highly debated

of building more hospitals because people were not

but we need parents and grandparents to participate.

reaching those hospitals either due to their condition or

They need to make children do physical activities and

because they did not want to. We dared to instigate this

move. Nowadays they only move two fingers to play

program and give it medical resources.

videogames and they do not play ballgames anymore. The city presents many opportunities, even for those

Many doctors and nurses asked me why we needed to

with less means, but parents need to seek them out and

go looking for patients in their homes. They thought it

encourage children. We are telling people how to eat a

was patronizing but they understood once they went to

balanced diet and why physical activity is important. We

houses and saw patients sprawled on beds 24/7 with no

have brigades for education and medical teaching in over

vehicle, no money to pay for a taxi and no ability to take

90 schools, giving recommendations to parents.

public transport. They saw almost 19,000 people with physical disabilities unable to leave the house. These people live and exist and were not present in the health system. There are diabetics and people with hypertension we are now monitoring. If we had not identified these patients they would have become an extra burden for the health system as they would have arrived at a hospital with a heart attack, a cardiovascular condition, advanced cancer or with diabetes that requires amputation or dialysis, or blind already. Caring for these people in their homes is the most cost-effective solution. We use generic medicine and when the doctors go to houses, they take their medicine bags directly to the patient. Q: How did this program obtain an international reach?

“We have found over 200,000 people in vulnerable conditions, almost 175,000 elderly adults that cannot leave their homes and almost 1,900 bedridden people in terrible conditions” Armando Ahued, Minister of Health of Mexico City

A: Ten doctoral Harvard students came and spent 10 days working here. Seeing our work, they uploaded it to their

I am convinced that there should be an obligatory health

social media saying, ´look at what Mexico City is doing´.

class in schools. It should be the most important subject

We then began to receive calls from health ministries

at school not because I work in health, but because there

from Guatemala, Panama and other countries that were

is nothing more important for a human than knowing how

interested in what we were doing. It is because they

the body works, how to maintain it in a healthy state and

came from such a high level of education that people

what the main risks are for your health. If we do not set

paid attention and asked how we were managing, what

a good example, how do we expect children to take care

strategies we were using to make it work. The Parisian

of themselves?

mayor was saying she wanted to implement the program for refugees, so did Madrid and a province in China for its

Q: What have been the results from the campaigns?

70 million inhabitants. This week I will be welcoming the

A: I think they have made progress, although no policies

Indian and Israeli ambassadors.

yield immediate results. We need to continue our efforts distributing information to the population. We have

Q: How is the situation of chronic degenerative diseases

already taken away salt shakers, made glasses of water

evolving in Mexico?

free and put a tax on soft drinks, which has resulted in

A: We have the most overweight children in the world

a rapid drop in the consumption of soft drinks. But no

and the second most overweight adults. This leads to

single action alone leads to long-lasting results. Many

many problems such as hypertension and diabetes and

policies need to be implemented. The government needs

we need to take action, starting with education. We

to have a wide range of offers but people need to be

have many campaigns in place, for example “muévete y

proactive.

13


| VIEW FROM THE TOP

HEALTHY CHOICES NEED INFORMED COOPERATION GERRY EIJKEMANS Representative of Pan American Health Organization (PAHO) and World Health Organization (WHO) in Mexico

14

Q: What have been the most valuable developments in

prevalence from 2009, which means not enough is being

public policy over the last few years and what remains

done. There is a lot of movement but it is not precise

to be done in the Mexican health system?

enough, not homogenous enough. Definitely, packages

A: Mexico has made significant progress in terms of

and labeling have an impact but packages alone have

health care. The creation of the Seguro Popular has

limited impact. Of course the package that says,

been important in giving access to more people.

“Smoking Kills” or with unattractive pictures can affect

Discussions are ongoing about portability, universality

a smoking decision, particularly among young women

and strengthening a model that is based on primary

about to take up smoking because of the idea of it being

care. If you look at the health situation in Mexico and

attractive or sexy. The neutral package is important but

many other countries, chronic diseases have completely

this strategy must go hand in hand with other elements.

overtaken infectious diseases. Applying tax on sugary drinks is an important step in creating a healthier

When we talk about chronic diseases, it is easy to say

population. Prevention and promotion are essential, as

people must take care of their own health. This is fine and

is the recognition that health is not created in hospitals

well if you have all the information, resources, finances

but rather at home or in the community, where people

or the choice but with those who are in a particularly

live and children go to school. Helping people make

poor situation and have very little money, their decision

healthy choices and making unhealthy products more

is shaped by the choices available. This is why the state

expensive go hand-in-hand with giving access to quality

has a very important role to play in helping people make

health services, with a focus on primary care. These are

the right healthy choice.

the big processes that are starting to have an impact on health. In general, life expectancy has increased, infant

Q: In terms of Mexico’s drive toward a universal health

mortality has decreased significantly and diseases have

system, what practices have you seen in other countries

been eliminated in Mexico. These are huge advances in

that Mexico can adopt?

public health.

A: What Mexico is doing in terms of strengthening the primary care model is very important because that is

Q: The WHO has been pushing through legislation to

where you get more value for your money, many more

neutralize cigarette packets. How do you think this will

people can be reached and you can work on prevention

impact the chronic diseases we see here in Mexico?

and promotion in a more holistic and extensive manner.

A:

several

The discussion on portability is very important as well. If

components. I think the most effective part is taxation.

you have a hospital or clinic of IMSS we should be able

If you make tobacco expensive enough, at some point

to find a mechanism to treat and receive people that do

people will stop smoking. This is a very effective tool

not have the same insurance. This is all very possible but

to create healthier habits. The second big measure

not necessarily easy. If we manage to look at groups of

is banning smoking in public places. Mexico City has

people and their risk profile and work together to treat

been at the forefront of this. There has already been

them, Mexico will be able to move forward. This is what

legislation in place for several years and here we can see

PAHO is supporting. Mexico, like many other countries,

that smoking habits are changing. At the national level, it

has built a hospital-based model that does not put

is still a challenge to get good legislation to ban smoking

enough resources and power at the local primary care

in public places in all the states. On 31 May, 2016, World

level. This model cannot deal effectively with chronic

No Tobacco Day, the National Institute of Public Health

diseases and we are failing when we wait to see the

published a study called the Global Adult Tobacco Survey

patient who comes for an amputation. This is failing the

and we do not see a significant difference in smoking

people, the economy and the health system and in the

The

strategy

on

tobacco

control

has


long run it is unaffordable. This is why the main focus

we are educating in Mexico are also important. We have

should be on primary care.

skilled specialists but too few family doctors. We are in talks with universities to see how we can ensure there

Q: How do you assess the advances in education?

will be the necessary resources to implement the primary

A: Education is definitely essential for shaping and

care strategy. First-line physicians should be equipped

changing

that

to resolve 50 to 80 percent of health issues without

on

having to refer to a hospital. The training of primary

prevention. It is in school where children will learn

care doctors must go hand-in-hand with the training of

healthy habits and hopefully take them back home.

specialists as part of a universal health strategy.

new

educational

generations.

programs

include

It

is

important

health,

focusing

We must work with teachers in schools to give children

15

the information they need. But it goes beyond chronic

Q: What do you think will be the next big development

diseases. There is a problem of teenage pregnancies

in Mexican healthcare?

and sexual education cannot wait for secondary school

A: We still do not spend enough public money on health.

when girls are becoming pregnant before even getting

Mexico spends about 3 percent of GDP on healthcare

there. Most teenagers in Mexico know they have access

and another 3 percent is private spending, mainly out-

to preventative resources but still about 50 percent of

of-pocket expenditure. Unfortunately, there are many

teenagers who are having sex do not use anything to

people who have to pay for services and cannot afford

protect themselves. So there is this big gap between

it. So there needs to be more public money in healthcare.

what they know and what they do and this gap must

Another important point is how we use money. WHO

be analyzed and understood clearly to close it. The

studies show that about 20 to 40 percent of healthcare

issue of empowering girls is also important because we

expenditure is wasted. It is important to not just see how

know they are more likely to get pregnant early if their

much money we put in but how we spend it to make it

mothers had a first child at a young age. Other issues

work effectively.

like alcohol and drug use are also part of the bigger picture of how sex is perceived. These topics need to

Those two things to strengthen the health system,

be included appropriately in the education of our youth.

together with focusing on primary care and promotion and prevention, are going to be making a very big

Q: A big danger in these rural communities is maternal

difference in Mexico. If you look at countries that have

and child health and they don’t necessarily have access

managed to create a healthier population, it is not done

to quality health services, so how does the government

exclusively through providing healthcare services, but

ensure a good quality of life for the baby and mother?

through public policies, addressing social determinants

A: There are strategies in place in Mexico with inter-

such as access to clean water, decent work and income

sectoral approaches to reduce maternal mortality, which

and quality education. These are long-term strategies

has been significantly reduced over the last 20 years

that require a social agreement between government,

but continues to be one of the biggest challenges in

private sector and the community working together

Mexico. We have made progress in expanding coverage

toward common goals.

and access to antenatal and neonatal care but we have increasing problems with the comorbidities. A pregnant woman with diabetes and hypertension has a much riskier pregnancy. We are working with the government to close the gaps beyond providing coverage and access to primary care, but also making sure that the women actually go to antenatal care. Q: One of the innovative strategies that Seguro Popular is implementing is related to E-Health and Digital Health. How do you think this is increasing coverage, especially in these rural areas? A: This is a necessary strategy and giving remote community clinics access to communicate with the rest of the country and with specialists and hospitals really helps. The digital aspect is complementary and good but only works when part of a bigger universal health and primary care strategy. The physicians and health workers

World Health Organization studies show that about 20 to 40 percent of healthcare expenditure is wasted


| INSIGHT

NO CHILD LEFT BEHIND FOR UNICEF At UNICEF we are here to support every child. It does not matter what kind of children or where they are. We focus on the 39 million children in Mexico. Of these, about 54

16

ISABEL CROWLEY

percent, about 21.4 million, are living in poverty and 4.6

UNICEF Representative

million are living in extreme poverty. So this already puts

for Mexico

the dynamic on the health factor because these children are living with less access to their right to health. Also, when you look at all the children, we know that if they are

UNICEF works depending on the capacity of the country

a girl, indigenous or if they live in a rural area, they have the

and what level of involvement the government has. So the

worst indicators in the country. This gives you an indication

type of assistance we give in Africa is not the same as in

of what we need to focus on. We are looking at the totality

Mexico. In Africa we would be implementing programs

of the children and the status we have helps to provide

with and for the government. In Mexico the capacity of

data and analyses with the Mexican government.

the government, both in resources and finances, is high in comparison to other countries although it is not equal in

Every two years since 2010 we launch a study on poverty

all the states. One tool we provide is the Situation Analysis

that highlights what we need to work on and looks at the

of Women and Children (SITAN) that we have been doing

six dimensions of rights, one of which is access to health

in eight of the poorest states for the last 2 1/2 years. There

services. We are looking at this analysis and see there is

are many dynamics that influence what happens in a state

little investment in children 0 to 5 years old, and this is a

depending if it is a rural or urban area. These studies inform

real problem because this is the basis for any future for

the government of the situation of women and children

these children. So if we are not investing in the 0 to 5 year

and the areas of opportunity where we can focus our work.

olds when we know that major brain development takes place from ages 0 to 2, we are not creating the basis or

Sometimes we do not have the resources at UNICEF to do a

environment for the future generation of Mexicans we want

national program, so we demonstrate through a pilot to the

in 15 years. Sometimes some of these things, like obesity,

government what needs to be done and implement it with

are not visible until afterward.

the government. We placed educational inserts in vaccine cards, for example. The idea is that UNICEF does it the first

These are the sort of things we do — we work with the

time and the government takes over afterward. This has

government and we highlight areas of health, education,

been our way to help prevent obesity, early infant death

protection, social security, wherever there are gaps and then

and promote breastfeeding. We believe the upcoming

we work with the government to identify which areas are

results will show positive change. We cannot say it is all

of concern and which areas we need to start working on.

thanks to UNICEF but we have definitely provided support.

For example, an area that has emerged is definitely obesity. Another is childhood pregnancies. We have children from

“If we are not investing in the 0 to 5 year olds when

10-14 years old that are becoming parents, so we are working with the government on that. We provide tools so that we can address these issues. We are also doing a national survey, which is done in over 100 countries, which provides

we know that major brain

many indicators disaggregated by gender and age. We will

development takes place

the areas where we have some gaps in information in terms

from ages 0 to 2, we are not

based on these results which will come out in September.

creating the basis for the future generation of Mexicans

look at the totality of what the survey says all over the world, of Mexico and then we’ll make proposals to the government This is the first time we have done it in Mexico despite doing it for over 20 years around the world. We also work very closely with the government to

we want in 15 years”

complete the general bill on the Rights of Children and

Isabel Crowley, UNICEF Representative for Mexico

This is a recommendation of the committee on the rights

Adolescents, which is something we are very proud of.


17

of the child and also the convention on the rights of the

important issue because it is related to many problems like

child, which Mexico signed 25 years ago. This is important

mental health and addictions.

because not only do we have the right to health very clearly defined in the law, we also helped the government bring

We also need to work hard on preventing adolescent

the law to 32 states and it is now a right in the constitution.

pregnancies, which are numerous in Mexico. These children

Now, it is not just saying the kids in this country have the

are not equipped, physically and psychologically, for having

right to health, we have to work with the government to

babies. First is prevention, then helping the girls that were

make that a reality. It took us a year to get this brought into

not able to avoid it. That means providing education, since

the states, and we have to make sure that it goes to the

they will most likely drop out of school. We try to see our

municipalities, which is where all the kids are.

work as the continuum of care. One is to prevent pregnancy in adolescents. Then we want to improve the care during

We have been working closely with the Integral Protection

pregnancy, birth and after birth because of the short and

System for Children and Adolescents, which has made a

long-term influence it has on children and mothers. We

big difference in Mexico. In the past, all departments were

want to see newborn babies with their rights because even

working in isolation. Each one was doing something for

though we have achieved the millennial development goal

children, but there wasn’t a body that coordinated all these

number 5 for lowering the under 5-years-old mortality rate,

activities and had a national plan. Now, every six months the

we see now that almost 60 percent of children that die

coordinating body sits down with the President, who is the

under 5 years old are dying in the first month of life. That

head of this Sistema, the cabinet and with the governors to

is why we start before the baby is born and then continue

discuss and approve issues that will then be brought to the

for the first five years during early child development.

states. This body really coordinates everybody’s activities

We want to help protect and help develop this kid in all

so they do not waste resources because they were not

stages of life, from the moment he or she is conceived to

talking with each other, and we can also easily identify the

adulthood. If we detect something in that cycle of life that

areas of opportunity where we still need to work. This is

is not working well, we will alert the government. We also

how we have been involved with bringing the Sistema to

find that life skills are important to teach as well. If you

the states. In these six months, we still have three states

are a parent and were not given love and attention, which

missing — Mexico City, which is on the forefront and very

is part of the early childhood development stage, you are

important for the rest of the country, State of Mexico

handicapped in cognitive and emotional ways. Also, they

and Queretaro. All the other states have established their

will not be able to give these things to their children and

coordinating bodies and are beginning to implement all the

the cycle perpetuates. About 90 percent of your brain

regulations necessary to make it a reality.

develops in the first two years of life. You can leave your baby in a corner to sleep or you can really stimulate him or

We are also looking at one area that has not been perceived

her. If you do not develop these connections in the brain in

as a health issue but is: violence. We think violence is an

the first two years, you can never catch up.


| VIEW FROM THE TOP

IMPLEMENTING PROGRAMS TO DECREASE MATERNAL MORTALITY MIGUEL LOMBERA President of the Mexican Society of Public Health (SMSP)

18

Q: What challenges does the country face in terms of

A: Interaction between the public and private sectors is

public health?

paramount. There should not be any political interest when

A: The first issue is the rate of maternal mortality in

developing these studies and public health should be the

childbirth. We need to reduce the risk especially in the

main focus. Associations like the SMSP exist for this reason,

most remote localities where the rate of teen and child

to work as an intermediary and maintain neutrality. Public

pregnancy is significant. Most of these girls, primarily

health’s mission should be to preserve health in society

indigenous, are not receiving the proper medical care or

through prevention, promotion, control, protection and

preventive education to avoid high-risk pregnancies. The

lobbying. In the family planning project, the SMSP took a

second biggest issue is that some women have very little

public sector initiative and found the resources in the private

antenatal care and that can impact the mortality rate for

sector, which is the ideal interaction from all three sides.

mothers and unborn children. A lack of family planning leads to older women entering high-risk pregnancies.

Q: If this project is replicated at a national level, how could the private sector help it come to fruition?

Q: What steps have been taken to investigate and provide

A: We collaborated with the Department of Planning and

solutions to high-risk pregnancies?

Health Development on a program called Fortalecimiento

A: The SMSP has initiated a project concerning maternal

a la Atención Médica, aimed at providing medical attention

mortality. We are focusing our efforts on preventing teen

with independent health mobile units, small vehicles in

pregnancies and helping provide proper antenatal care

which a doctor and a nurse go to remote communities to

for mothers in vulnerable groups. Such a venture requires

help the most vulnerable people. We want to collaborate

resources such as personnel, vehicles and material. We

with the ministry on this project.

carried out a beta test to intervene and educate these groups, so they may start making better decisions while

Q: What other projects relating to public health is the

still respecting their own customs. This initial test was

SMSP working on and how and when will these have an

quite successful, which led to a three-year program in

impact?

a small number of localities where we not only focused

A: We have been working on different projects; some are

on prevention and planning, but also in interacting with

having a very strong impact on our country already such

the people. For two years we have targeted 20 localities

as our vector-borne disease project. This is particularly

that have around 2,000 inhabitants in six states: Chiapas,

relevant in Mexico with diseases such as dengue, zika

Hidalgo, the State of Mexico, Oaxaca, Veracruz and Yucatan.

and chikungunya transmitted by the mosquito Aedes

We concluded that women with high-risk pregnancies

aegypti. A year and a half ago we found if the mosquito

were not experiencing proper antenatal care due to either

did not exist, neither would the illness. Today both zika

cultural issues or misinformation. We undertook a pilot

and chikungunya are public health issues. We offered the

test in Yucatan to ensure people understood the message

Ministry of Health a study to determine if the pesticide

without misconceptions. We researched the effectiveness

used for the campaigns was effective. We captured nearly

of using their local dialect instead of standardized Spanish

150,000 mosquitoes and showered them with pesticide.

and developed comic-book style material to support

After 48 hours, if the mosquito remained stationary it

educational and training efforts. The best promoters for

was most certainly dead but we found that due to the

this type of venture were local health professionals.

mosquito’s resistance to pyretrhoid the pesticide would only immobilize them and after a period of four to five

Q: As these types of efforts and campaigns require funds

hours the insect would recover. Our study proved that

the public sector cannot absorb in its entirety how can

in reality pyrethroid pesticides kill only four out of 10

the private sector help and participate in these projects?

mosquitoes.


| VIEW FROM THE TOP

TAKING MEXICO INTO THE 21ST CENTURY MARLENE LLĂ“PIZ President of the Association of Medical Specialists in the Pharmaceutical Industry (AMEIFAC)

Q: What is the new vision for this association in the 21st

Q: Given the influx of resources into the country, what are

century and what do you want to achieve with it?

the priorities for the association in terms of helping the

A: This is an association that has been around for 50 years

industry grow?

and is considering modifying its name to make it more

A: A priority is to help orient new companies when they

inclusive to other professionals in the pharmaceutical

come into Mexico. We must be sure of what we are

industry. There are not only medical specialists in the

bringing into the country. We are always searching for

pharmaceutical field but chemists, biologists, lawyers,

quality, efficient and safe drugs for our population. We

nutritionists and many others. The second thing I want

also believe in providing a strong platform for continuing

to do is to modernize the statutes, which are somewhat

education in the pharmaceutical sector.

outdated. The association has four commissions with two people in each and it states that they must be physicians. I

Q: Despite regulatory systems becoming friendlier, what

want to open it to three members per commission and have

are the obstacles to improvement?

two of them be non-medical. There is great diversity and

A: One of the main problems is dealing with government

talent in the pharmaceutical field that is not being brought

agencies because of the bureaucratic processes. The

into the association because of these outdated statutes.

simpler the government can make it without compromising restrictions, the easier it would be for our industry to

We also want to expand internationally, especially into

move forward and make drugs available to the population.

Latin America to create collaborative agreements with

COFEPRIS has done an outstanding job in listening to

other associations to share information. We are preparing

the pharmaceutical industry, collaborating closely and

large meetings for Mexico City. The first, in September

providing new platforms for moving drugs to the market

this year, is a national meeting that serves as a platform

in a shorter time span.

for COFEPRIS to discuss diverse hot topics. Next year, we will have an international meeting where we will be

Q: How do the actions of pharmaceutical companies

inviting people from North, Central and South America,

match up with the actual state of public health in Mexico?

as well as Europe and speakers from diverse fields of

A: It matches up entirely because the generic and biotech

pharmaceutical medicine. They will be instrumental

drugs are directed toward the aging and those chronic

in letting us know how their regulations are changing

diseases most prevalent in Mexico, like diabetes. But it

and new aspects on pharmaceutical medicine. The

is important to remember that problems like obesity go

pharmaceutical field has changed drastically over the past

beyond the pharmaceutical and public health reach. They

few years and I foresee that generics, biotechnological

require educational and social change as well.

products, and oncological products will be the most Q: In terms of trends and new drug development, are we

important topics for the near future.

looking more at treatment drugs or drugs that cure the Q: What are the trends in Mexican clinical research?

disease?

A: Mexico is an outstanding place to conduct clinical

A: I think the trend is more toward treating diseases because

trials because there are extremely qualified researchers

there is still a lot to be done to cure the main diseases.

with

state-of-

Science such as genetics behind cancer or vaccinations

the-art infrastructure and facilities. In the past each

against HIV are moving forward, but not as fast as we would

pharmaceutical company conducted their clinical research

like them to. The ideal scenario would be to find a cure but I

in-house whereas now the trend is to outsource this

do not think we are there yet. We are focusing on improving

service. In-house or outsourced, there will be a huge boom

quality of life by treating those that are already ill, aging or

in clinical research here in Mexico.

suffering from chronic degenerative diseases.

specific

know-how,

experience

and

19


| VIEW FROM THE TOP

HEALTHCARE DRIVES PRODUCTIVITY CRISTÓBAL THOMPSON Executive Director of the Mexican Association of the Pharmaceutical Research Industry (AMIIF)

20

Q: In light of industry trends, what has been the main

and healthcare systems in place. We believe that a healthy

focus of AMIIF over the course of the last year?

Mexico is a productive Mexico and this will also have a

A: Our main priority has always been to ensure effective

strong impact on the country’s development abroad. We

access to pharmaceutical innovation and we are doing

are working closely with other associations such as AMID,

this through an extensive approval rate with public

the Health and Wellness Council, ACROM, FUNSALUD

institutions mainly IMSS, ISSSTE and Seguro Popular.

and 25 patient associations. Last year, we established four

Only 10 percent of innovative medicines are approved

possible scenarios for Mexico ranked on attractiveness,

for use in public healthcare institutions and this must

and today the country places in the third segment. The

change, both in terms of the number of approved

optimum scenario includes access to innovation and all

medicines and speed of access. Nowadays, these

activities we are implementing at this point target that

drugs take an average of 4 1/2 years to be introduced

goal.

into public healthcare institutions, affecting patients with non communicable diseases who are unable to

Q: In the face of an ever-changing healthcare system,

receive adequate treatment. Our second priority is to

what are the main challenges you have experienced?

guarantee the highest quality standards, especially for

A: COFEPRIS and the General Health Council (CSG)

biotechnological medicines and biosimilars. We are

have made significant developments in the matter of

pleased that NOM 257 has been enforced but we still

regulations for biotechnological products and the CSG has

have to ensure the requirement standards for biosimilars

approved 65 percent of them. The low healthcare budget

are sufficient to provide patient safety. In addition,

is among the main problems the sector is facing since only

we are focusing on bringing more clinical research to

6.2 percent of the GDP is invested in healthcare in Mexico,

Mexico, for which it is necessary to update all internal

while the OECD average is 8.9 percent. Pedro Aspe, CEO

processes. At AMIIF, we greatly support all regulatory

of Evercore, compiled a comprehensive report of the

modifications COFEPRIS has implemented in recent

healthcare system and discovered that 8.8 percent of the

years but there are still opportunities for improvement

budget was spent on administrative expenses, while the

including the acceleration of clinical studies at IMSS and

OECD average for administrative expenses is 3.4 percent.

the implementation of a clinical research program at

We believe that Mexico can analyze these expenditures

ISSSTE. We are working alongside COFEPRIS to improve

and save expenditures by using that money to invest in

the regulatory environment in the country.

healthcare services directly. Our first recommendation would be for the healthcare system to identify the areas

Q: What other strategic alliances have you developed to

in which it is overspending and redirect this money to

position healthcare as key to improving productivity in

increase efficiency, hence, the healthcare budget should

Mexico?

be increased. The OECD estimates that in the next 30

A: This was among the largest shifts in our strategy.

years, the resource allocation must increase by between

There is a strong link between health and productivity

7-11 percent to satisfy growing demand.

and we are discussing this connection within several associations, including COPARMEX and CONCAMIN. We

Q: To what extent does the healthcare system in Mexico

want healthcare to become a priority for the Mexican

adopt a patient-centered approach and what can be done

government, which will allow the country to improve

to improve this?

patient outcome and fully understand the impact of health

A: The healthcare system as a whole must undergo a

on productivity. Mexico’s working population will increase

reform. There are several discussions regarding the next

in the next 10 years from 70 million to 88 million and our

steps the system must undertake. Recently, Dr. Mercedes

goal is to ensure these individuals have solid education

Juan, the director of the National Council for the Inclusion


and Development of the Disabled (CONADIS) mentioned

Q: Given the volatility of the market in the last year, what

that the government is open to discussing the Health

should we expect from the industry in terms of new

Reform, thus all the actors in the system will have to

products and M&A activities in 2016?

develop a proposal to place the patient at the center of

A: Regarding products, it is clear that innovation is at the

the conversation. This has not been done so far but it is a

forefront of the industry and we will have the opportunity

highly necessary step to improve the system. Among the

to see many new products in Mexico, including one for

problems that damage the efficiency of the healthcare

hepatitis C that can cure approximately 90 percent of

system is its fragmentation, so to increase efficiency it

patients. We also hope to have an approved medicine for

will be necessary to align the entire organization with

dengue that is undergoing registration. Several companies

the regulatory authority. Another topic to discuss is

have a strong pipeline so we will provide a forum for all

portability, which will allow the system to capitalize on its

of them to present their latest developments within our

current infrastructure.

Innovation Week. These pipelines are expected to include many biotechnology products. In terms of M&A, we saw

Q: Are you engaged in conversation with IMSS and

several in the final months of 2015 and we expect this

ISSSTE to reduce the speed with which these institutions

trend to continue throughout 2016. AMIIF’s first priority

incorporate new medicines into their basic formularies?

is to work with major employer associations. The second

A: We have continuous talks with IMSS regarding basic

is to ensure that health becomes a significant priority for

formulary registrations and one of the topics being

the government, which will allow increased efficiency and

reviewed is the implementation of new models to

eventually raise the healthcare budget. We expect that

incorporate innovation, a priority for both the government

this surge will translate into reinvestments in infrastructure

and the industry. These models can be diverse and are

and human resources, including recruiting more nurses

generally implemented after discussions between all

and doctors. Finally, we plan to work on further increasing

interested parties. One successful example is the case of

access to medicines.

Hepatitis B, despite the fact the details of each process are confidential between IMSS and each pharmaceutical company. Distribution models are also evolving mainly for specialty products as companies are identifying new ways to reach their patients more efficiently. Q: Mexico has the potential to triple clinical research investment from US$200 million to US$600 million in five years. What is the best way to achieve this? A: Clinical research funds are assigned to a country based on the needs of the multicenter study and the regulatory authority’s approval speed. COFEPRIS’ approval speed has greatly increased as approval times were reduced by 60-70 percent in the last year. It is necessary to ensure the proper authorization for these studies is received and that researchers are properly compensated. At this point, we are in the process of bringing all stakeholders together. This year, we signed an agreement with the Autonomous University of Nuevo Leon (UANL) because it has a large capacity for clinical trials. Our role in this negotiation was to ensure innovative companies were fully aware of all the services the university has to offer. UANL already has 250 protocols with several innovative companies and in April 2016 will host our Innovation Week where we will gather all service providers for clinical trials in Mexico. This includes hospitals, academia and research centers and all companies that might require these services. One of our goals is to support investment in Mexico and contribute to research in the country, which will eventually lead to its development. To do so, we are collaborating with CONACYT, ProMéxico and several healthcare institutions.

21


| VIEW FROM THE TOP

HARD-HITTING INITIATIVES TO COMBAT PRIORITY MALADIES JOSÉ CAMPILLO 22

Executive President of FUNSALUD

Q: How is FUNSALUD contributing to improve and

acting on our goals for universal healthcare. There is a clear

promote the healthcare system?

commitment to universality, but there is misunderstanding

A: Every year we refine our mission of generating scientific

surrounding what that entails. It means being able to

evidence to support public policies. Simultaneously, we

provide basic services little by little regardless of a patient’s

are an internationally recognized think tank, acting as

employment status. Employed by the private sector or the

a platform to discuss ideas and opinions. We adapt to

public sector, in the armed forces or not, everyone should

problems and opportunities as they present themselves.

be able to access a basic set of health services and have one assigned provider. To achieve this, we must finish the

President Peña Nieto’s administration has prioritized other

implementation of a registry called the Padrón Único de

industries over a profound reform of the healthcare system.

Beneficiarios (PUB). Some citizens are registered with up

A significant Energy Reform and a very complicated

to three different health providers and have private health

educational reform in which political leverage was slowly

insurance. As a result, our calculations of the amount

dwindling, took precedence. We then saw crude oil price

of resources needed are inflated. Institutions reap the

drops, and by the time the planned health reform was

benefits of patients that will never come. Improving this

due, the sociopolitical factors to support it were no longer

issue requires purifying the PUB.

present. Therefore, the Health Plan has been put on hold. We are not yet resigning ourselves to a lame duck administration

Q: How should spending on healthcare be allocated to

as we still have three years in front of us. A new and very

use resources efficiently?

experienced Minister of Health is in office and is also an

A: We are spending more than 6 percent of GDP on

expert in local political mechanisms to take effective action.

health, most of which goes toward the acquisition of

We are replanting our strategy to aid the Ministry of Health

health technology. Despite being a lot of money, it is still

with the most relevant topics in the health sector.

insufficient. We are not sure that purchases match the ideal strategy for the country. We therefore want to conduct

Q: What are the most relevant health issues and in which

studies that can help us define the technology we need.

is FUNSALUD prioritizing its participation?

Incredible technology exists, such as remote attention

A: The concerns seem to be similar to last year although

and diagnosis centers that allow experts concentrated in

we may add one or two new issues. Budgetary needs are

specialized institutions to interpret diagnosis images. We

struggling to solve problems such as chronic diseases.

do not limit the health system to the personnel onsite at

Diabetes, breast cancer, obesity and mental illness are

each hospital or clinic. Having this information available

prevalent. By 2030, a third of productive years and life

would allow every universal case file to be assessed by

expectancy lost will be due to mental illnesses. Funds ought

specialists, improving spending allocations. We need to

to be transferred to chronic degenerative diseases, for

move toward technology that can allow us to provide

which there is an attention deficit of more than 70 percent.

massive medical attention without depersonalizing it.

In addition, Dr. José Narro has identified underage

Q: What other public policy initiatives have you been

pregnancy as a serious problem. An oversight in

encouraging since last year?

campaigning for safe sex and prevention has aggravated

We are very optimistic about the Ministry of Health’s

a multitude of factors affecting our youth, who begin their

support on two initiatives that FUNSALUD proposed. We

active sex life from a very young age.

do not have a national register for cancer or chronic kidney diseases, two conditions that affect Mexicans greatly. The

Primary care is our priority and we want to call on different

lack of these numerical registries means that any strategy

sectors to adopt models of primary care that can start

we propose could be thwarted. Nevertheless, the Ministry


23

of Health has begun preliminary data-gathering and we

The UK is following Mexico’s example of a sugar and fat

should have the first results of these registries during the

tax and is already heading toward a 20 percent tax rate.

course of this year.

To what extent these disincentives can help is not known, but a tax will not be enough in Mexico. We could restrict

FUNSALUD has been carrying out studies on the integrated

expenses on food, education and transport, but sodas

cost of diabetes. We also released a study on doctors’

have become indispensable in our diet. FUNSALUD must

offices that are adjacent to pharmacies, which was highly

be at the center of the nutrition, wellbeing, and metabolic

polemic and interesting. Their increasing presence shows

syndromes discussion to reach a consensus as to how to

a problem in the public sector’s level of attention. Next,

tackle the problem appropriately. The obesity problem is

we want to measure satisfaction and attention received by

multi-factorial and we should re-evaluate our sedentary

patients to understand the trend and decide how to take

lifestyle. All technological advances are designed to avoid

advantage of this newly created infrastructure. We also

non-necessary or unwanted physical activity so we need

need to measure doctors’ ability to identify serious illnesses

to study scenarios focused on inactivity, to confront this

and to direct patients to specialized care. We know that

issue’s effect on our weight.

these offices mostly treat digestive, respiratory and skin problems as small, but necessary fixes, but in more serious

Q: Where do you see your projects in 2016?

cases we do not know if patients are receiving referrals.

A: As a foundation, we must amplify our membership base, and go beyond pharmaceutical companies. We could

We are also working with the Inter-American Development

strengthen the presence of insurance companies and

Bank (IADB) to engage important telephone companies in

hotel chains, due to the growing trend of medical tourism.

raising awareness on health issues. The initiative is called

Mexico has stumbled on a market that creates nearly

M-Salud and uses a bi-directional platform to care for

US$3.5 billion a year in revenues and has the potential to

diabetic patients. The IADB is interested in the Mexican

improve medical practices.

population due to its size, its level of development and the spread of cell phones. Moreover, given our racial and

There are two important legislative initiatives. One is the

genetic similarities, Mexico could be a springboard to the

reform on the Law of Science and Technology together

rest of Latin America.

with the Law of Responsibilities of Public Servants, which will improve the relationship between the public

Q: How did your Niño Sano y Activo program help create

and private sector for scientific research and enable new

a prevention culture around chronic diseases, particularly

support systems to be built for researchers. Scientists

diabetes?

can benefit from this in terms of discoveries, patents

A: The Niño Sano y Activo program concluded with some

and in general, but it has not been given the importance

interesting results. Obesity in children begins at home. We

it deserves. There is also a project to reform the law

have tried to tackle this problem in two distinct manners,

surrounding public health institutes, which has been the

one with the Nestlé Nutrition Foundation (NNF) and

same since 2000. As hospitals and specialized institutions

the other through a new council inside FUNSALUD that

are at the forefront of R&D, reform could have an extremely

promotes nutrition and health.

favorable impact on innovation in Mexico.


| VIEW FROM THE TOP

AWARDING OUTSTANDING CONTRIBUTIONS TO HEALTH ROBERTO TAPIA Director General of Fundación Carlos Slim

24

Q: What are the objectives of the Foundation’s national

free to train their personnel. Lastly, the implementation of

vaccine program?

a modern database will be required.

A: Many years ago our foundation, with the help of experts, evaluated the obstacles vaccine programs face

Paper records need to be substituted for digital databases.

in Latin America. It found the region is a leader when it

Mexico would be the first country in the world to adopt

comes to vaccine policies yet there is plenty of room for

a digital, en-masse system. Technology is a useful tool

improvement. The issues and recommendations became

that needs to be incorporated into health institutions.

part of the Foundation’s vaccine program. We worked hard

Adhesive chips are promoted because they can capture

to create a legal framework to strengthen the program

a child’s immunization records. The chips are connected

with the help of health authorities and the Mexican Society

to a computer or a tablet that give up-to-date information

of Public Health. The proposal has been approved by the

to vaccinators anywhere in the country. Our goal for 2018

Senate and is awaiting a response from Congress.

is to create electronic records for 3 million children. The project is being resourced by the Río Arronte Foundation

Once applied, the law will guarantee funds for vaccine

and ourselves. It is coordinated with the help of the Health

programs. Children, teenagers and adults will all benefit.

Ministry. We are pleased with the fact that it is being

Our passion is rooted in the fact that vaccines are one

implemented in communities that are mostly indigenous

of the best preventive measures that can be offered and

with the IMSS-Prospera Program and in highly populated

cutting public funds for vaccines is counterproductive.

cities. This technology has the advantage of working in

People are more at risk of becoming ill and ultimately

areas that do not have Internet access, and updates

public resources are wasted in curing preventable health

automatically when it is connected to a network.

issues. Q: How would you describe the annual awards ceremony

“The region is a leader when

the Foundation started in 2008? A: This year we had our ninth edition, where we presented

it comes to vaccine policies

our two awards. The first award is recognition of

yet there is plenty of room for

impact on a health-related area, primarily in vulnerable

improvement”

in the long run, as well as a model that can be replicated

Roberto Tapia, Director General of Fundación Carlos Slim

Latin American not-for-profit institutions that have an communities. The jury looks for sustainability and impact elsewhere, with emphasis in our region. Organizations are selected by a panel of independent judges. We received more than 140 proposals from 14 countries in 2016. This year the award was granted to TeenSmart International,

The legal framework consists of three important elements.

based in Costa Rica.

The first bans officials from cutting vaccination funds. Next, it promotes the inclusion of more qualified agents and the

Our second award is reserved for a researcher whose

training required for the latter as the administration is

work has benefited the health of the people living in the

more specialized and cannot be done by volunteers. The

Latin American region. The researcher can reside in a

program will always welcome volunteers when it comes

country outside the region but the work must be geared

to other areas but vaccinations need staff with medical

towards the region. We have had winners who are high-

knowledge. Fundación Carlos Slim also provides online

profile leaders from Europe or the US and who developed

certification courses that medical institutions can use for

strategies to improve nutrition levels.


The award represents one of the most significant amounts available for health in the Latin America region, a US$100,000 prize. Its objective is to provide economic value and enrich the selected projects. Even though the Foundation does not demand a particular use, personal use of the award is actually quite rare. Our panel finds the selection of a winner increasingly difficult each year. Dr. Rafael Lozano, a world class researcher, was awarded the prize this year. 25

Q: Why is Dr. Rafael Lozano’s research so relevant? A: The most important element of Dr. Lozano’s work includes his talent as a global leader and the knowledge he has contributed toward the burden of disease. The latter entails a measurement of how the health of population is affected in comparison to the mortality rate. It is a way to measure the number of years of life lost to preventable conditions. A teenager that passes away in a car accident would have lost 60 years of life. The accumulation of lost

Q: TeenSmart is an institution that is in touch with youth

life years can exhibit the impact of mortality not just as a

and helps them make better decisions. How did this

number but on the overall economic and social spheres of

initiative place them as a candidate for the award?

a country and its sustainability.

A: We are pleased that this year’s judges made the decision to grant this organization an award as youth are a priority

The measurement can be added to other calculations

for us. The age group is essential to the wellbeing of all

to create a clearer picture. It can include data such as

countries as they bear the responsibility as future leaders

the amount of time someone is sick and the amount of

in politics, the economy and social matters. The youth of

healthy years a person has. It can measure how much was

today are a complex result of a health focused period in

lost during a drop in health conditions. The data is meant

history that changed the paradigm of premature mortality

to standardize and describe the effects of an illness in a

of infants. The generation was born with better physical

society. The information is helpful when it comes to injuries.

conditions than previous groups, but the same cannot be

There are also different categories in the system for people

said about their mental health. Stress and a lack of proper

that become disabled in situations like paralysis. The sum

decision-making create obstacles for many youths.

of all of this data becomes the weight of an illness. TeenSmart is an important piece of the puzzle as they Dr. Lozano is one of the most relevant leaders due to

are teaching this generation to manage the pressure

his innovative work in Latin America. Mexico is one of

with values, respect and resilience, combined with

only three countries in the world that has developed

the importance of having a life plan. The organization

the methodology internally in each state; the others are

gives hope to many and guarantees a brighter future.

Great Britain and China. It has placed itself among a quite

It collected enough points to win first place due to its

selective group.

positive intervention amid the rough battles youths face in Latin America. Fundación Carlos Slim has taken this

The purpose is to improve public policy decisions. The

opportunity to link our Clikisalud.net web portal with their

country has 90 percent of its populations on public

platform.

insurance. The services are limited by fiscal resources, taxes and inputs. Consequently, efficient public health

Q: What are the Foundation’s goals for the next year?

policies and accurate information are important. Officials

A: We want to solidify our work and make sure public

can use the data to create better decisions and receive a

policies are directly helping communities. It is all part of

new perspective about the country’s reality.

a national strategy to create deep changes in Mexico. Fundación Carlos Slim is thankful for all the support it

Lozano has worked with many groups in Latin America

receives from institutions and Dr. José Narro, the Health

to expand the collection of this type of information

Minister, and his team. It has become part of the official

throughout the region. Dr. Lozano leads the research team

Mexican strategy. Our mission is to continue to achieve

and his impressive efforts have qualified him to receive the

and implement these methods into institutions and public

Fundación Carlos Slim award.

policies.


| INSIGHT

FROM REVOLUTION TO EVOLUTION: 90 YEARS OF ESPM prevention. From 1945 to 1982, the school faced important challenges resulting from complex international socio-

LAURA MAGAÑA

26

Assistant Director General

political contexts. World War II, the Cold War and different

and Isabel Vieitez, Director

armed and student movements in Latin America caused

at Mexican Institute of Public

the school to respond to foreign interests, mostly from the

Health (INSP)

US, to build a continental shield against the Axis countries (Germany, Italy and Japan) and the Soviet Union. US aid from Health for the Americas provided an opportunity

Springing from the turmoil of revolution, the School of

to enrich public health officers’ academic and scientific

Public Health of Mexico (ESPM) is a pioneering institution

backgrounds in Latin America.

that deals with an array of public health challenges. Starting as a hygiene and sanitation training center, it has

Efforts to cement a scientific foundation into health

evolved into one of the leading academic and research

professionals’ education, as indicated by the Flexner report,

schools of public health in the developing world. Since its

started to flourish with academic programs, partnerships

foundation in 1922, the first of its kind in Latin America and

with the Infectious and Tropical Disease Institute, and student

the second in the Americas, after the School of Hygiene

exchanges with counterparts in the US such as Harvard and

and Public Health at Johns Hopkins University, the ESPM

Johns Hopkins. Financial support from the US Office of the

has undergone several structural changes to respond

Coordinator of Inter-American Affairs helped Latin American

to public health issues, as well as to the national health

students train at ESPM. Mexico, alongside other countries

organizational restructuring and health education reforms.

in the region, founded the Latin-American Association of Schools of Public Health to incorporate a continental scope

The ESPM was established in response to the need for a

for public health practice. This close collaboration, alongside

health and sanitation workforce during the complex health

ideology discussions, provided the vision for modernizing

and social situation faced during the armed movements

public health practice by reaching a balance between

of the Mexican Revolution in 1910. Within the same period,

academic, research and service components.

international health education reforms were triggered by the Flexner and Welch-Rose reports and the philanthropic

During the ‘70s, there was a break in public health’s

participation of the Rockefeller foundation. This entity

modernization process because of outdated academic

established training centers to combat infectious epidemics

programs. This was the result of lost formal links with

and also constituted a key element for ESPM’s foundation.

international research and academic institutions and

In 1943, the school became the Ministry of Health’s welfare-

the reorientation of policy and health infrastructure

training center for medical doctors, nurses and sanitation

development. This trend changed in the '80s through

personnel. During its first two decades of existence,

the vision of highly qualified officials returning from

ESPM adopted a more social perspective, providing

postgraduate studies at renowned international public

technical campaigns teaching skills that promoted disease

health schools, bringing new ideas for modernization.

“The ESPM, now part of the

A major reform occurred with the creation of the National

INSP, has been key to improving

of ESPM, the Center of Public Health Research (CISP) and

Mexico’s public health

reform made INSP legally independent from the Ministry

programs and public policy by

strategically to address emerging public health challenges.

generating scientific evidence

Institute of Public Health (INSP) in 1987, through the fusion the Infectious Disease Research Center (CISEI). Additional of Health, which allowed the institute to plan more Structurally, INSP has embodied different decision-making organisms that allow it to adapt to different needs and

to orient strategic decisions”

challenges and make it accountable for its decisions.

Laura Magaña, Assistant Director General and Isabel

graduate training and continuing education programs were

Vieitez, director at Mexican Institute of Public Health

envisioned. A clear goal was set to transform the newly

(INSP)

formed INSP into a highly academic and scientifically

After the creation of the INSP, research consolidation,


qualified institution. It was intended to address burdens

facing epidemiological emergencies such as influenza in

on the health system and other emerging public health

2009, followed by cholera and zika. More than 250,000

threats following a deep analysis of the academic offering

health workers have been trained in this format. To

to identify its needs and flaws. This process also included

guarantee high academic standards and continuing

changes in the pedagogical model, incorporating the use

improvements, the INSP has been credited by the National

of information technology and communications, and the

Council for Science and Technology in 1994 and by the US

professionalization of teaching.

Council for Education in Public Health in 2006. This makes it the first institution with this accreditation outside the US.

Currently, the INSP offers more than 30 professional and research-focused degree programs. These include an M.Sc.

The ESPM, now part of the INSP, has been key to improving

in Health Systems Quality, a Ph.D. in Public Health, a Ph.D.

Mexico’s public health programs and public policy by

in Public Health Sciences, Nutrition and Environmental

generating scientific evidence to orient strategic decisions.

Health, a residency program in Preventive Medicine, as

As well as developing the workforce’s expertise through

well as certification programs. Their M.Sc. in Public Health

a wide range of degrees and continuing education

covers 10 focus areas, and the M.Sc. of Health Sciences

programs, many of the school’s courses are implemented

straddles eight areas of concentration. The institute offers

in partnership with the Ministry of Health and state-level

diverse educational formats beyond the standard school

health departments. Evidence from national health surveys

timetable and format, such as executive programs on

conducted by the INSP from 1996 to 2012, has provided

weekends and an intensive online program.

insight into different health and development challenges, from

infant

iron-deficiency

and

non

communicable

In the last 10 years, the continuing education program

diseases to the need to promote a health reform initiative

has allowed the Institute to strengthen the public health

to create universal coverage. This evidence, along with

workforce by training over 60,000 professionals. The

program evaluations, has provided essential information

development of MOOCs (Massive Online Open Courses),

for decision making in the implementation of social

has been fundamental to update the in-service workforce

programs in the country.

| EXPERT OPINION

FORTIFYING GLOBAL PRACTICES

The World Bank Group has supported and will continue to support the Mexican health system to ensure better quality and access to health services to all, and particularly to

MARÍA BONILLA

vulnerable population groups. This support is contingent

Senior Economist at

on the government’s requests. It can include not only

the World Bank

financial services but also technical assistance and analytical work, and convening services. Specifically in the health sector, the World Bank Group The health sector cannot improve health outcomes

continues to support and strengthen the monitoring and

alone. Support from sectors such as the environment,

evaluation of the National Strategy for the Prevention and

social protection, transport and education is essential.

Control of Overweight, Obesity and Diabetes. Through

Within the World Bank, the latter support is often

building awareness and through data collection, the entity

provided by other global practices and not necessarily

is providing support to the Ministry of Health’s efforts to

through the Health, Nutrition, and Population Global

fortify primary healthcare services.

Practice. This is exemplified in the World Bank’s Social Protection Global Practice, which supports the Prospera

Contingent on the government’s request, the World Bank

program, while other global practices work on the

would be happy to extend this support to other areas or

environment alongside a Cross Cutting Solution Area.

deepen the already existing support through financial

This department supports climate change issues in

services. This could also include activities that mimic the

client countries.

previous World Bank and Oaxaca partnership.

27


| INSIGHT

GLOBAL REACH EXPOSES ETHICAL ISSUES IN RESEARCH MARLENE LLÓPIZ

28

in the research trials. The potential for such exploitation

President of Mexican

is cause for a concerted effort to ensure that protections

Association of Medical

are in place for all persons who participate in international

Professionals Specialized on

clinical trials. This is heavily enforced by the regulatory

the Pharmaceutical Industry

agencies and ministries of health in all Latin American

(AMEIFAC)

countries. As a first step, in most Latin American countries research

The increasingly global nature of health research, and in

protocols are carefully reviewed by ethics committees that

particular the conduct of clinical trials involving human

may be externally contracted agencies serving as a third

subjects, and dealing with pharmaceutical drugs –

party for approving trials or as part of the hospitals/sites

whether reference drugs, biopharmaceutics, generics, or

where the trials will be conducted.

devices – has highlighted a number of ethical issues. This is especially true in those situations where researchers or

This is often followed by state or national regulatory

research sponsors from one country decide to conduct

agencies dedicated to the detailed review of all trial

research in another, in this case in Latin America. The

documents. In some countries, both state and national

research protocols might simply be one way of helping

agencies are in charge of reviewing all paperwork related

the host country address a public health problem, or they

to a clinical study. After the protocol is reviewed, the most

might reflect a research sponsor´s assessment that the

important document that follows is the informed consent

foreign location is a more convenient, cost-efficient or less

form. This special document is reviewed by several entities

troublesome site for conducting a particular clinical trial.

for the protection of the participants. In countries, such as Mexico, additional paragraphs are added to the informed

Sometimes, the hosting countries serve as sites where the

consent form detailing special law-abiding conditions, as

drugs or devices have not been marketed or the region

well as the need for two witnesses to sign when participants

serves as a zone where trial conduction is less expensive,

agree to partake in a trial. This is in addition to requiring

has a greater number of naïve patients and adequate sites,

insurance for the patients during their participation in a

as well as experienced researchers. It may also be that for

clinical study.

registration purposes in other countries, testing drugs/ devices in different regions helps companies accelerate

Inversely,

scientists

from

developing

countries

are

submissions to regulatory authorities in their home

becoming more involved as collaborators in research,

countries.

as many of their home countries have developed their capacity for technical contributions to research projects

Other studies may serve as a joint effort to address an

and for appropriate ethical review of research protocols.

important health concern faced by both parties, as in

Clear examples are researcher-initiated trials. Although

the development of vaccines due to the outbreak of an

the source of funding for such collaborative research is

epidemic or a public health issue. In these situations,

likely to continue to be the wealthier developed countries,

sponsors and hosting countries rush to solve an emerging

collaborators from developing countries are seeking to

problem that requires an immediate solution. Ethical

take part in the research enterprise. These may be through

issues should not be left aside, no matter the urgency.

international organizations, pharmaceutical sponsors or government agencies. In either direction, ethical issues

Whatever the reason, as the pace and scope of international

have to be carefully reviewed and considered.

collaborative biomedical research have increased during the past decade, long standing questions about the ethics

The current landscape of international research also

of designing, conducting and following up on international

reflects

clinical trials have re-emerged. Some of these issues have

conducted by pharmaceutical, biotechnology and medical

begun to take center stage because of the concern that

device companies. It seems as if market forces have

research conducted by scientists from more prosperous

pressured governmental institutions to become more

countries in poorer nations that are more heavily burdened

efficient in reviewing the types of clinical trials that enter

by disease may be seen as imposing ethically inappropriate

the designated countries in the conduct of research.

burdens on the host country and on those who participate

ministries of health in Latin America have become more

the

growing

importance

of

clinical

trials


29

rigid and careful in analyzing study documents. They are

by whom after their participation in a trial has ended; and

now known for taking their time in reviewing protocols,

what benefits, if any, should be made available to others in

insuring that patients are not disregarded, are carefully

the host community or country. Governments often require

guarded and cared for. Although the extent, relevance and

treatments to be continued and provided free of charge to

force of these pressures are widely debated, it is clear that

participating subjects until the patients succumb or the

such pressures can exist regardless of the funding source.

treatment is available for purchasing on the market.

Complex and important ethical concerns are likely to be

Many issues come into play when dealing with the

more pressing in clinical trials than in many other types

ethical aspects of clinical research whether sponsored

of research investigations. Other major topics addressed

by a pharmaceutical or device company or investigator

when reviewing ethical issues are the choice of research

initiated. Special consideration must be given to trials in

designs, especially in situations where a placebo control

children, in the mentally disabled, in the elderly, in the

is proposed when an established effective treatment is

blind, etc. When deciding on conducting a trial in Latin

known to exist; issues arising in the informed consent

America, careful consideration should be given to the

process in cultures whose norms of behavior differ; what

ethical issues involved in protecting participants. It is no

benefits should be provided to research participants and

different in Latin America, nor should it be.


| EXPERT OPINION

MEXICO CRUCIAL ON GLOBAL MAP OF OPPORTUNITIES companies through the organization of specific forums aiming to bring new technologies to the market. FENIN

JULIA LÓPEZ

30

Technical Consultant for

also collaborates with public R&D centers developing

the Spanish Federation

innovative initiatives in hospitals and other healthcare

of Sanitary Technology

institutions. We are certified as an internationalization

Enterprises (FENIN)

agent, helping companies to expand their business to international markets. To promote internationalization, we attend important exhibitions and congresses about the

Q: What role does the healthcare industry play in Spain

industry, including MEDICA in Düsseldorf, one of the major

and how is FENIN organized to reach the most companies

healthcare summits in the world.

in the sector? A: FENIN represents 80 percent of the total market sales

Q: How will your visit to Mexico help your Spanish

in Spain and 5 percent of the market share in Europe,

members expanding their business to America?

which is in part possible thanks to the 500 members

A: We are on a commercial mission to analyze the market

that belong to FENIN. The market for healthcare

conditions and provide an in-depth perspective to our

technologies in Spain was worth around US$7.75

clients willingness to enter or consolidate their presence in

billion (EUR$7.000 billion) in 2015, US$2.55 billion of

Mexico. So far, our agenda has consisted of visiting Mexican

which corresponded to exporting products. FENIN’s

healthcare institutions, including different hospitals. We

members include multinational companies that have

had, for instance, a meeting with the healthcare division

a strong presence in the market, as well as innovative

of the National Chamber of the Manufacturing Industry

small and medium enterprises (SMEs) manufacturing

(CANACINTRA), the innovation sector, and the Direction

and exporting healthcare products from Spain. At the

of Innovation and Technology of IMSS. We also have held

moment, SMEs represent close to 90 percent of our

meetings with the COFEPRIS, the healthcare division

membership, which is in line with the scale distribution

of PEMEX, as well as different private actors such as

found in the Spanish industrial sector. In the case of

the Hospital Español. The meeting with COFEPRIS was

multinationals, we are working with most of the main

particularly relevant as we might be able to coordinate

multinational companies of this sector, representing

the certifications provided by them with those of Spain

their medical divisions in international markets. We

to help companies entering the two markets. Mexico has

work under a vertical organization based on product

multilateral agreements established with the governments

areas due to the high level of diversification found in the

of Japan, Canada and the US, facilitating the homologation

healthcare market, now having over 500,000 references.

of sanitary certifications among the different territories.

FENIN’s administration is managed by a national board

Regrettably, Spanish companies do not enjoy these

of directors and a regional one for Catalonia, a region

benefits. Additionally, we are in talks with infrastructure

where the healthcare industry is showing buoyant

centers and associations to analyze the potential of

activity.

developing innovative infrastructure projects for the healthcare sector. For instance, we have visited Sacyr

Q: How is FENIN helping its members in Spain to move

and the Mexican Association of Specialized Healthcare

their businesses forward?

Architects (SMAES). In Spain, we are the only association

A: Our goal on an institutional level is to represent and

dealing with the industry of healthcare technologies while

defend the interest of the healthcare sector before

there are several actors working in this area in Mexico, a

national stakeholders. We help our members with legal and

situation that has also enriched our commercial mission.

regulatory aspects of the industry, as well as innovation, internationalization and sustainability issues. For instance,

Q: What crucial discoveries have you made during your

we analyze the potential impact of regulatory changes

commercial mission to Mexico and how will you apply the

in our market. At the moment, we are following the

lessons learned to your work in Spain?

advancements done in the Code of Good Practices, which

A: The similarity of COFEPRIS’s requirements with those

will avoid the direct sponsorship of healthcare professionals

of the FDA was an important aspect arising during this

to congresses, implementing the use of an external entity

mission. We have now identified the need to help our

for this purpose. Regarding innovation, we promote the

members comply with American standards as most of

collaboration

them have no experience exporting products outside

between

entrepreneurs

and

healthcare


Europe, in addition to communicating Mexico’s specific

mapping of the business opportunities around the world,

requirements that our clients need to be aware of. For

where Mexico plays a crucial position.

instance, Mexican regulations require enterprises to have local representation in the country, which must be

Q: What are the advantages that Mexico offers to

considered in the estimated costs of expanding their

international healthcare companies, and what areas

business to Mexico. We have also identified a wide range

should be improved to foster foreign investment?

of opportunities among the healthcare institutions,

A: The market size is definitely one of Mexico’s most

companies and associations that we have visited in

attractive points, for instance, the 60 million people

Mexico, particularly within the public healthcare system.

affiliated with IMSS. We have identified a strong demand

An important fact we discovered in Mexico is the lack

for imported healthcare products, offering a wide range

of local technology manufacturers, which makes it one

of business opportunities to multinational and SME

of the largest importers of these kinds of products. In

companies. Mexico’s geographical position is also highly

particular, we see interesting opportunities for companies

attractive, particularly as it shares borders with the US and

dealing with in-vitro diagnostics, chemical reagents for

has coasts on the Atlantic and Pacific oceans.However,

medical use, sterilization and medical equipment. We

the Mexican market is also fragmented and complex,

also see an important opportunity for software and

which represents important challenges for our members.

apps connected to medical equipment with the purpose

Long and complicated bureaucracy is also a challenge for

to optimize healthcare costs, as well as IT solutions for

European companies, so we see room to improve in this

remote medical consultation. Getting back to Spain, we

area. We are analyzing the best strategies to speed up

are planning to share this information with our members,

this process, which includes using a local distributor or

putting special attention on our SMEs associates. These

establishing a local subsidiary. Companies generally avoid

companies require more training and are in greater need

the use of subsidiaries as it raises costs considerably, but

of the institutional networks we have developed during

in some cases, it just makes economic sense. The public

our commercial mission in Mexico. Our objective is to be

healthcare system in Mexico is so broad that getting a slight

a facilitator agent across different levels of the healthcare

share of it is enough to assure the investment return and

market so we aim to provide our members a general

the company’s position in the market.

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31


| EXPERT INSIGHT

SOUTH A HUB FOR MEDICAL EXPERTISE JOSÉ LIXA

the southeast with amazing results in health, education and

Broker and International

safety. This has turned the city into the favorite destination

Consultant of Parque TecniA Universidad Anáhuac

of southern Mexican inhabitants to enjoy the quality services this destination offers. Every day the clinics and hospitals have inhabitants from Campeche, Quintana Roo, Tabasco,

32

There are several views on medical tourism in Mexico but

Veracruz or Chiapas who specifically come to undergo

it is important to realize that to talk about Mexico is to talk

procedures that can be ambulatory, such as dental health,

about a country with different styles and particularities.

or for more complex treatments, such as for cancer and

There are characteristics that naturally drive states toward

cardiovascular illnesses.

specific activities, be it services or industry development, agricultural activities and in some cases tourism.

Being connected with both the East and West coasts of the US, through Houston and Dallas, the proximity to Belize and

Yucatan is a state that for over a century has had a perhaps

Guatemala and the opening of direct flights from Merida

limited inclination toward industry or big companies but

to Toronto and Havana have strengthened the number

it has some of the most natural attractions in the country,

not only of holidaymakers and business travelers, but also

positioning its tourism offerings above destinations that do

medical tourists. The notable quality and training of over

not have beaches, haciendas, cultural sites or the Mayan

4,500 doctors and the infrastructure of the city has allowed

civilization that calls to foreigners so much.

it to diversify its hospitality offerings from boutique hotels to all business suites.

Unlike other states, Yucatan does not have a natural terrestrial border that would have helped patients, mostly

Before the arrival of tourists from Mexico, the east of the US

from the US, come for medical services. Still, without a doubt

and Canada, the state government launched during this six-

its capital Merida has become the most prosperous city of

year term the platform Yucatan Healthcare that has brought

| VIEW FROM THE TOP

STATE SUPPORT FOR MEDICAL TOURISM SAÚL ANCONA Minister of the Yucatan Ministry for Tourism Promotion (SEFOTUR)

Q: Why is Yucatan a prime medical tourism destination?

Q: What strategies is the state government implementing

A: Medical tourism has been developing in Yucatan for

to promote Yucatan in the US and Canada and what other

many years due to the high quality and globally competitive

markets is it primarily targeting?

hospital infrastructure and the long tradition of training

A: The strategies in place to promote the Yucatan

excellent doctors in local universities. Patients from

healthcare digital platform are reinforced by participation

nearby states such as Campeche, Chiapas, Tabasco and

in international medical tourism exhibitions that occur

Quintana Roo travel year on year to Yucatan for checkups

once a year in Canada and the US. As members of the

and various medical procedures. Yucatan receives year-

Medical Tourism Association (MTA) the platform is

round visits from abroad due to its privileged geography.

promoted in specialized reviews and on the association’s

Particularly from November to April when countries like

website. Nationally our visitors are mostly from the

the US and Canada are in winter, many visitors decide to

southeast. Internationally, they come from Belize, Canada

come to a warmer beach climate and some have medical

and the US. We also give the private hospitals of Yucatan

checkups, attracted by the lower prices and the quality of

training on obtaining the IPSC, given by the Medical

service.

Tourism Association, and the state government gives


Yucatan, its main doctors and private institutions to the

with professionals that can give globalized and personal

attention of important associations and brokers.

care and would help avoid pitfalls, generate real statistics and allow the client to have a smooth process. As a

The warm climate is an advantage to welcome tourists

broker allied with the entire value chain, without thinking

looking to escape cruel winters. Between October and April

of a patient’s limitations, I need to know exactly what his

there are communities full of Canadians in Yucatan, which

or her budget and needs are: the link between patient and

has forced surrounding clinics to improve and has created

doctors, hotel and transport arrangements, airport transfers,

clusters of health due to existing needs.

bilingual translations and 24-hour assistance and special requirements such as wheelchairs.

In 2015 the Anáhuac University Certification in Medical

33

Tourism was launched, targeting doctors, brokers and

With “Tailor-Made Yucatan”, we have succeeded in having

administrative personal in the health sector. Almost MX$10

every provider focus on their specialty and it results in a team

million (US$530,000) has been set aside from the state

of professionals that guide the patient to the best results.

budget for marketing purposes. In terms of certifications, we

Companies like Yucatan Medical Services are fundamental to

are not only counting on the JCI but are giving clinics tools to

the optimal performance of the workforce in the state and

work under Canadian accreditation. This shows the growth

the government and academic alliances have shown our

in demand and in the purchasing power patients possess to

competition that is not state-wide but international that we

migrate to other destinations for care that is available in their

have triumphed, thanks to low costs and fast response times.

cities of origin. The goal for the end of 2016 is to see a larger flow of The figure of the medical broker is paramount. In other

visitors due to the promotion and marketing carried out

industries such as real estate or construction, it is true that

and measure which were the most effective methods.

a house or apartment complex can be sold without help,

2017 should be a year of reaffirming institutions with

but the specialists that have formed around constructors

international certification and 2018 should be the year in

have professionalized the industry with fewer risks

which we see results of adjusted marketing techniques,

to clients. Similarly, the needs of patients going to an

certified care providers and economic benefits of the

unknown destination alone has bestowed the industry

secondary sector we can compare with statistics.

them 70 percent of the total cost to motivate clinics to

the Accreditation Canada International, based on the

obtain certification. Private clinics have also received help

prestigious Canadian healthcare model.

in obtaining an “M” distinction from the Programa de Calidad Moderniza and “H” from the Programa de Manejo

Q: What impact will we see on the country’s foreign

Higiénico de los Alimentos.

investment, capital retention and GDP from medical tourism inflows?

Q: How will medical tourism contribute to a shift in the

A: Medical tourism could have a strong and positive impact

perception of Mexico and what are the main challenges?

on the country. The diversification of products and services

A: According to Patients Beyond Borders, in 2014 Mexico

that a country offers is the key for a strong economy.

was the second country globally for medical tourism. An

Medical tourism has an extensive value chain because the

increasing number of visitors are seeing the country’s

distribution of capital inflows is not concentrated on a

potential as a medical destination as in the last few

small group of actors. The benefits medical tourism brings

years more clusters have been created, generating more

will increase in Yucatan with the arrival of private hospitals

competiveness. Security is a key factor that has positioned

and the implementation of international certification.

us so highly internationally and within the country. Changing the exterior perception of Mexico remains a goal.

Q: What are the state’s plans for 2016? A: In 2016, Yucatan Healthcare will participate in two

Several renowned hospitals have seen the potential of

international exhibitions focused on medical tourism. One

having a presence in Yucatan. The new Faro del Mayab

is “Destination Health” in September in Ottawa. The second

de la Red Médica Sur hospital will have JCI certification,

is in Washington, D.C. also in September and is organized

which will raise the competitiveness of the state and will

by the Medical Tourism Association. In both events we

attract more foreign patients, who have expectations

will meet with companies interested in medical tourism to

of high quality and know the prestige such certification

create agreements of mutual benefit so patients can travel

entails. Some hospitals are also working on obtaining

to Yucatan to undergo medical procedures.



2

HEALTHCARE SYSTEM

With multiple budget cuts to the health sector over the year, the public healthcare system is increasingly working in partnership with private institutions to maintain quality of care. Healthcare expenditure in 2015 fell to 5.9 percent of GDP from a high of 6.2 percent in 2010, according to the OECD. This is one of the lowest rates among OECD countries. There have been shifts during the year. Mikel Arriola moved to IMSS from COFEPRIS, Julio Sánchez took over COFEPRIS and respected academic José Narro became Minister of Health. Public social security institutions made great advances over the past year in decreasing waiting times for patients, reducing the backlog of operations and reducing costs through consolidated purchases. As of this year, they will actively minimize duplication among IMSS, ISSSTE and Seguro Popular. Many also stress the importance of reducing the burden on the secondary and tertiary levels of healthcare through improved prevention and early diagnosis. Public institutions are implementing preventive campaigns such as “Chécate, Mídete, Muévete” to improve public health and curb the epidemic of

chronic diseases like diabetes and hypertension clogging hospitals and clinics. This chapter reviews the public system’s efforts to cover a larger number of people more effectively and the role the private sector plays.

35



37

| CHAPTER 2: HEALTHCARE SYSTEM 38

VIEW FROM THE TOP: Mikel Arriola, IMSS

40

VIEW FROM THE TOP: Gabriel O’Shea, Seguro Popular

42

VIEW FROM THE TOP: Armando Ahued, Minister of Health of Mexico City

44

VIEW FROM THE TOP: Germán Fajardo, UNAM

46

VIEW FROM THE TOP: César Athié, Hospital General de México

48

VIEW FROM THE TOP: Alejandro Alfonso, ABC Hospitals & Association of Private Hospitals

50

MEXICAN HOSPITAL STATISTICS

51

VIEW FROM THE TOP: Javier Aluni, Hospitaria

54

VIEW FROM THE TOP: Francisco Villarreal, Swiss Hospital

55

VIEW FROM THE TOP: Roberto Bonilla, Hospital San Ángel Inn

56

VIEW FROM THE TOP: Arturo Martínez, Hospital Galenia

Olivia Laviada, Hospital Galenia

57

VIEW FROM THE TOP: Luis Navarrete, Clínica de Mérida

58

VIEW FROM THE TOP: Roberto Sosa, CODY

59

VIEW FROM THE TOP: Ricardo Bojalil, ASMED


| VIEW FROM THE TOP

PROMOTING EFFICIENCY THROUGHOUT IMSS MIKEL ARRIOLA Director General of IMSS 38

Q: During your tenure as COFEPRIS Commissioner

such as the Unifila program, now adopted by 46 percent

you drove an agenda of simplification of bureaucratic

of our hospitals, so that people who arrive without an

procedures and digitalization. How do you bring those

appointment don’t have to wait at least a day as before, but

subjects to a much larger institution like IMSS?

can be in front of a healthcare professional in less than an

A: One of the main aims of our strategy at IMSS is deregulation

hour. Another problem was appointments with doctors on

toward increased efficiency, both in medical services and the

the second level of care, which had taken up to four days

economic services related to the pensions system, such as

and now takes half an hour in 60 percent of our hospitals.

retirement and disability. We tend to 70 million people, more than half the country. Regarding deregulation, we provide

We also had a hospitalization bottleneck because it took

medical and social security services to around 1 million

24 hours to ready a bed for a new patient after the last

people daily and back in 2012 all bureaucratic procedures

one left and now it takes only eight, increasing availability.

had to be done in person, at an annual cost of about

We have implemented this new procedure in 46 percent

MX$3.0 billion (US$158.7 million). From 2013 at the behest

of our hospitals. We also had to reduce a backlog of about

of President Enrique Peña Nieto, IMSS started changing to

8,700 surgeries but since mid-April we started using

a digital platform called IMSS Digital and now 72 percent

surgical theaters on weekends, adding around 200 more

of the 25 formal procedures we review are done digitally,

surgical procedures per weekend. We have performed

meaning that in the last three years we have served 80

2,237 programmed surgeries on weekends.

million procedures in a digital manner, saving around MX$2.5 billion (US$132.3 million). We aim to close this administration

Another

in 2018 with 35 million digital procedures a year and nearly

prescription. Whereas before a patient with a chronic

zero done in person. This includes everything from proof-of-

illness had to attend a medical consultation once a month

life certification for pensioners to employee registration and

to fill out his or her prescription, after a medical-risk

from day-care registration for toddlers to maternity leave

evaluation we were able to determine nine treatments

registration for pregnant women.

where we could fill prescriptions quarterly, saving 8 million

subject

we

attacked

was

chronic-patient

consultations a year. Q: In terms of health services, how much has IMSS advanced on easing procedures and digitalization?

We are also trying new protocols in 44 percent of our

A: We operate about 6,000 medical facilities, we are

hospitals for triage in emergency situations to properly

the largest healthcare provider in Latin America with

and efficiently classify patients according to the urgency

a capacity for 500,000 medical consultations, 6,000

level. In 12 facilities for example, we have implemented a

surgical procedures and 1,070 daily births, around 30,000

protocol for heart attack patients, called Código Infarto,

beds, 36 third-level hospitals, including 25 specialty units

that has reduced the treatment time from the first early

and 350 second-level hospitals. We are also dealing with

symptoms to when a stent is put in to half an hour from

an increase in chronic diseases like diabetes, cancer and

three hours. That has cut mortality rates by 60 percent.

hypertension and heart disease. These patients represent 20 percent of our affiliated population but demand 80

Q: According to the OECD, IMSS receives far less financing

percent of our budget for preventable diseases which

from the system’s final users than in other countries in the

were not prevented.

group. How has IMSS learned to work around this deficit? A: The OECD provides data but what needs to be compared

We are looking to modernize bureaucratic procedures. We

is the tax burden in terms of salary for affiliates. After doing

cannot forgo face-to-face consultations but on the primary-

that you can say the current burden is acceptable. If by

care level we have since March put in place new procedures,

increasing the burden we affect the size of the workforce,


39

we would have a serious problem. We need more jobs.

Q: Another important cost-cutting strategy goes through

That is what helps in the end in terms of financial terms

preventive care, as with campaigns like the “Chécate,

for IMSS. The 2.04 million jobs created in the three years

Mídete, Muévete.” But what other efforts are being made

and seven months to July 2016 have helped increase IMSS

to reduce costs tending to illnesses like diabetes?

intake by 26 percent, some MX$50 billion (US$2.6 billion).

A: We can no longer avoid the issue of preventive medicine. This is not trivial. We need to stop the encroachment of

IMSS has two main financial pressures. Firstly, the pensions

chronic diseases. At IMSS we are working on a concrete

from the old retirement system that was modified in

policy to correct two big flaws of our health system,

1997 and are fully funded by the State. That creates a

which are detection and control. We are working on a new

financial burden of MX$2.0 trillion (US$105.8 billion),

model for community family health units with the ability

close to 10 percent of Mexico’s GDP, with 10 percent

to lead youths toward better habits, with metrics we can

annual growth, causing payments of about MX$70 billion

track to detect diabetes and hypertension and also breast

(US$3.7 billion) every year. Secondly, the epidemiological

and prostate cancer, and to treat adults with early stage

and demographic transition the Mexican population is

diabetes and hypertension. This will be our turning point

undergoing creates financial pressures on IMSS to provide

to get from curing a disease to preventing it. We can no

medical services.

longer spend 80 percent of our budget on 20 percent of the population that failed to prevent their health condition.

In the last three years we have reduced the IMSS deficit by

If we do nothing, by 2050 we will go from spending

60 percent and now sport a fiscal surplus, which means we

MX$80 billion (US$4.2 billion) treating chronic disease

have been able to pay for pensions and medical services.

to spending MX$350 billion (US$18.5 billion), which is unsustainable.

Q: Regarding costs, the possibility of having PPPs building hospitals has been increasingly in the spotlight.

Q: What fallout has IMSS had to deal with after this year’s

Is IMSS involved in this at all?

budget cuts?

A: What IMSS has done is to take advantage of this

A: We are an independent government entity with our

new legislation to facilitate the construction of new

own resources coming from taxation and contributions by

infrastructure, clearly without medical care being in the

employers. We are not affected by budget cuts, but that

hands of the private sector at any point. That is a legal

is not an excuse not to be more efficient. This year we

impossibility. We are having facilities built at a faster pace,

are committing to fiscal savings of MX$7.0 billion (US$370

more efficiently and without the hurdles associated with

million). We started to consolidate medical supplies

direct public investment. We have had bidding processes

purchasing, we have also had savings in medical services

for four hospitals. We are looking to be more efficient. We

such as tests and also promoting competition via bidding

want to build more hospitals with less money, we have

processes for procedures like dialysis that has led to

MX$20 billion (US$1.06 billion) to build 12 hospitals and

savings of around MX$7.0 billion (US$370 million) annually

four of those will be through PPPs.

for the last three years, with a similar goal for 2016.


| VIEW FROM THE TOP

PUTTING THE SPOTLIGHT ON PEOPLE NOT PROCESS GABRIEL O’SHEA National Commissioner of Seguro Popular 40

Q: Since the introduction of Seguro Popular, what

Q: How will you balance the budget cut and Seguro

have been the changes you have witnessed in Mexico’s

Popular’s announcement of increased coverage to

healthcare sector?

ensure you still provide quality healthcare to Mexicans?

A: Over the past 14 years we have managed to cut

A: We are constantly working to include more illnesses

out-of-pocket spending by 11 points, down from 55.7

into the Universal Health Services Catalog (CAUSES)

in 2003 to 44.7 in 2013. Although the system is young,

directory, or to increase access to the Catastrophic

this profound effect shows we are certainly on the

Expenses Fund. Ovarian cancer was recently included

right path. We have also witnessed an epidemiological

because

transition. The incidence of infectious and transmittable

interventions, which include the most expensive illnesses,

diseases has been reduced while there is an increased

with MX$12 billion (US$ 600 million) in funding. In the

prevalence of chronic degenerative diseases usually

three years I have been at Seguro Popular I have removed

found in developed countries. Now Mexicans live longer,

cataracts from this Catastrophic Expenses Fund because

they have an average lifespan of 75 years which presents

this does not qualify as a catastrophe, whereas ovarian

greater challenges and costs to the healthcare system,

cancer requires a great deal of money to treat.

the

Catastrophic

Expenses

Fund

has

61

because they can develop conditions such as diabetes mellitus, entailing dialysis, hemodialysis and amputation.

At the moment, we have 82,000 patients with HIV with access to the Catastrophic Expenses Fund in which we

Q: These diseases are largely due to Mexico’s retroactive

invest approximately one quarter of the total budget.

approach to healthcare, so how are you changing the

Each of these patients costs roughly MX$39,500

system to implement a more preventive approach to

(US$2,000 ) per year and these are costs that are

medicine?

catastrophic for patients. The removal of cataracts from

A: Of the 57 million Mexicans affiliated with our system,

CAUSES freed an extra budget of MX$1 billion (US$50

about half are given an initial clinical assessment in which

million), which allowed the addition of ovarian cancer

we examine several factors such as hereditary illnesses

to the register and allows us to treat on average 3,364

and probability of contracting certain conditions. We

patients each year. We do not receive more money to

then implement regular testing to detect any potential

incorporate more treatments into CAUSES, but we are

illnesses if red flags are raised. If a condition cannot be

constantly evaluating the value of those treatments that

prevented as is the case with hereditary diabetes, we

are incorporated. I would like to increase the maximum

use the clinical assessment program as a way to control

age of coverage of acute myocardial infarction from 60

the symptoms. Seguro Popular’s budget for 2016 is a

to 65 years old.

little over MX$77 billion (US$4.1 billion), 20 percent of which is allocated to preventive medicine. This involves

Q:

screening for breast cancer, cervical cancer, and control

impacted budgetary restrictions?

How

have

consolidated

purchasing

strategies

of obesity. If I could, I would dedicate the entire Seguro

A: The system has great merits and has significantly

Popular budget to primary points of care to emphasize

changed the healthcare system. While some states buy

the benefits of preventive medicine. Primary points of

aspirin for MX$5 (US$0.27), others can purchase at MX$1

care deal with 80 percent of the illnesses Mexicans suffer

(US$0.05) or even MX$0.5 (US$0.02). Making a large

from, whereas only 20 percent of the illnesses are seen

consolidated purchase means costs will be reduced. This

at secondary and tertiary points. In the next few years

system works very well. In 2014, we saved MX$3.7 billion

Seguro Popular will focus on the quality of medical care

(US$198 million) in the purchase of medication. In 2015,

at primary points of care. We aim to refurbish 2,500

we saved MX$4.5 billion (US$241 million). These savings

health centers in the next two years.

can now be used in other ways.


Q: How is Seguro Popular helping to change the system

and Sinaloa, and although this is expensive, it is easier

to focus more on people rather than processes?

than relocating medical professionals to remote areas.

A: According to the OECD, Mexico is the country with the most administrative processes for its healthcare system

Q: With IMSS, ISSSTE, and Seguro Popular, there is

in the world. We are paying a great deal of administrators

a great deal of duplicated coverage. How are the

while facing a shortage of doctors and nurses. It is

organizations working to eliminate this?

difficult to change this process and it is happening

A: Of the 57 million Mexicans we cover, 4.7 million currently

because of the ease of administrators recruitment. We

have IMSS coverage too. Both government institutions

are committed to reducing administrative costs and

must pay for treatments, doubling the cost. These 4.7

increasing the number of doctors and nurses employed

million affiliates will be reduced by 1.5 million this year,

by Seguro Popular.

followed by a further 1.5 million the subsequent year. This situation arose because we never had an updated register

It is very clear how Seguro Popular’s budget should

before, but now when affiliates renew their policy after

be distributed, with 40 percent destined for medical

three years, we receive a notification if they are already

personnel, 20 percent for preventive medicine, 30

registered with IMSS or ISSSTE. This will prevent affiliates

percent on medications and 6 percent allocated to the

from renewing their Seguro Popular policies.

offices in each state. But in many states more of the budget is spent on administration and less on medical professionals.

“We do not want to privatize

We are working on this problem and we are in discussions

healthcare in Mexico but make

with each state to convince them to increase the number of medical professionals in their hospitals. We have opened an account at the Ministry of Finance for each state in which we deposit their respective budgets. After making purchases, each state will then approach the Ministry of Finance with their receipts to be reimbursed

it more accessible to more people” Gabriel O’Shea, National Commissioner of Seguro Popular

from their nominated account. This avoids misdirection of funds, and there is much more accountability in terms

Q: What is the future for Mexican healthcare, and what

of payments.

role will Seguro Popular play in a higher quality of life for the population?

Q: With the need to extend coverage to the most remote

A: A few months ago President Peña Nieto spoke of the

and rural areas, how are you incentivizing medical

beginning of a universal healthcare system in Mexico,

professionals to work in isolated regions?

starting with an exchange of services between IMSS,

A: It is difficult to create incentives for doctors who have

ISSSTE, and Seguro Popular. We do not want to privatize

studied for half their lives to work in a rural community

healthcare in Mexico but make it available to more people.

and be paid MX$24,000 (US$1,300) per month. When

The exchange of services will mean that patients will

I discussed the issue with the Ministry of Health, we

not have to be flown to the other side of the country for

arrived at the conclusion that municipal governments

treatment with a certain expensive piece of equipment.

should be obligated to offer these professionals an extra

Rather, each institution will be able to access the technology

MX$5,000 (US$270) per month and they would help the

possessed by the others, cutting costs of treatment and

doctor find a house, for which the community would pay

travel. This raises the question of how this exchange will

half the rent.

be possible since these services are all saturated, but we should really all be thinking about what we can offer. For

Seguro Popular has invested in mobile clinics, in which

example, Seguro Popular could cover cataract removal

doctors rotate, traveling to various rural locations over

for the entire State of Mexico, and IMSS could cover heart

the course of a week to provide treatment. In the State of

surgeries, and each agency would reimburse the other.

Mexico there are certain areas that are difficult to reach, so we bought medical robots equipped with cutting edge

The main problem will be in harmonizing prices as

technology at a cost of MX$20 million (US$1.07 million)

procedures cost a different amount in each agency. This

each. With telemedicine, it only takes one specialist to

is simply the beginning of a universal healthcare system.

consult with patients through the robot’s screen, and

We will reinforce infrastructure at the primary points

this can be done from anywhere in the country. This

of care and focus on providing clinics with the correct

robots are located in various states such as Zacatecas

equipment and staff.

41


| VIEW FROM THE TOP

CARE IN MEXICO’S LARGEST METROPOLIS ARMANDO AHUED Minister of Health of Mexico City 42

Q: What have you seen in terms of private investment in

Q: This year we have seen a new COFEPRIS regulation

the health sector in Mexico City this year?

that incentivizes research and development in Mexico.

A: Very important advances have been made. The

What can the public sector do to attract more investment

Regional General Hospital of Iztapalapa is almost

for Mexican development?

finished. Since 1985 this hospital had been unable

A: In Mexico, we have important institutions such as UNAM

to keep up with the demand in Iztapalapa and its

and the IPN that develop new technologies and medicines

equipment could not be modernized. It was necessary

and that make us attractive for these investments. I think

to throw everything out and start from scratch. The

one of the main development opportunities in Mexico

second HIV/AIDS clinic in Iztapalapa is spectacular. The

City is the study of the impact of pharma economy,

existing clinic in Condesa was overrun by demand so

pharma vigilance, new processes and new technological

a second, ambulatory clinic was urgently needed. It is

therapies. I would say the public sector is carrying out

now in operation and running smoothly and this model

research on the same high level as private institutions.

will be replicated in Latin America. I was invited to a UN

We have people with high capabilities such as engineers,

HIV event in New York, where Mexico City received an

biomedics and medical specialists, we have patients and

award for its work in HIV/AIDS. We also built the first

beds and all the technology necessary to evaluate the

clinic for autism and in a few months we will finish the

results. It becomes very attractive to those who do R&D

first geriatrics clinic, and a second diabetes clinic. The

as there are facilities in place.

first public veterinary hospital in both Mexico and Latin America is remarkable as it safeguards the health of pets

Q: What has the impact of the cooperation between

and also human conditions caused by animals. We are

IMSS and the Ministry of Health been?

also building the hospital that will replace one damaged

A: Mexico City's Ministry of Health has instigated

by an explosion. In total, over a dozen health centers are

cooperation among the states. There are now regional

being renovated or built.

and metropolitan actions for which we are designing coordinated health policies, among the entire public

Q: What is your plan for the coming year?

health sector. We have made great advances on linking

A: We are being conservative as there has been a budget

the public health sector of the country.

cut of 300 million pesos (US$16.3 million) for the city and the Seguro Popular and a further cut of 6.0 billion

Q: We are now seeing a tendency of registering generics.

pesos (US$325 million) to the health sector has just

What benefits will this have?

been announced. Because of this, it will be difficult to

A: Generics are a wonderful means of providing quality

begin new projects. Most probably we will focus on

in medical attention and making it more accessible. We

maintenance, new equipment and continue to give

buy medicine in consolidation with IMSS and we buy

medical attention to those who need it. We will not be

generics. We treat 22 million people and it works very

thinking of growth in our infrastructure but on the quality

well. We are giving high-quality care and I believe this

of patient care. The recruitment of doctors and nurses

is the way to ease the high cost of medicine. Medicine

will also be affected but there will not be any job cuts

is increasingly effective but costly, which renders certain

as we are using fiscal resources from the city to ensure

medicines unaffordable for the public sector as the

no one has to leave. Medicine is an area to which cuts

budget can’t withstand it. Treatment for Hepatitis C can

cannot be applied. In Mexico City there are 135 clinics,

cost up to MX$1 million (US$54,000). The development

32 hospitals and 12 subway clinics. We employ 37,000

of generics is one of the great possibilities of medicine

people and see 22 million patients per year, so not a

reaching the masses, more so in a system where people

single aspirin can be cut.

do not pay out-of-pocket and receive medicine for free.


Q: What is being done about the lack of quality

We are promoting campaigns to prevent water from

treatment received in some doctors’ offices associated

accumulating. Mosquitoes breed in clean water, not

with generics’ pharmacies?

dirty water, so if people have pots and watering cans

A: COFEPRIS and the agencies of patient protection are

in their gardens and water gathers, that is where the

working on this. We are checking that doctors do not

mosquito reproduces. We need people to act and throw

prescribe medicines just for the sake of it, but according

things away. Many actions do not depend solely on the

to ethics. We need to continue to work on this without

government and alone we cannot control everything.

a doubt. Fundamentally, everyone should be seeing to the health and wellbeing of the patient. We can continue

Q: What is the public sector implementing in terms of

to do what we are doing, inspecting, observing the

new technologies that help develop the health sector?

actions of the doctors and making sure that they are not

A: We are advancing. Here in the Ministry of Health

profiting from patients.

we implemented the System for Medical and Hospital Administration and electronic patient records. We

Q: How can the private sector help the public sector?

are already working with video-medicine or video-

What can they bring?

consultations, electrocardiograms and respirometers.

A: We need to continue with the present synergy. There

We have 140 electrocardiographs in the city. An

are companies such as SANOFI that have helped us

electrocardiogram is sent automatically to the National

educate children on eating, diabetes and hypertension.

Institute of Cardiology, then the cardiologist reviews

We have just vaccinated 40,000 children against

it and sends instructions to the doctor in the medical

the human papilloma virus and they are studying the

center. They know what medicine to start with and what

impact of this, they supported us with the costs of the

medicine they need to buy. Heart attacks need to be

vaccination to make it possible. Bayer and many others

treated within the first hour. This gives the patient an 80

have approached us. They are our allies. Working with

percent chance of surviving.

the private sector presents many opportunities to study impacts and implement new strategies.

We have 70 respirometers connected to the National Institute of Respiratory Diseases, and molecular biology

Q: What about seasonal illnesses and viruses like zika

laboratories. We are close to seeing a laboratory for

and chikungunya?

detection of epidemiological diseases. We have MRI

A: We tell people we are in a period of gastroenteritis:

machines,

do not eat in the street, wash your hands, do not self-

equipment. We are implementing technology but we are

medicate. In October, we will start vaccinating against

limited by our resources.

tomography

machines,

and

other

new

influenza. There is a vaccine, it is free and people need to come and get it. We do not have a problem with any of the three mosquito-borne diseases, dengue fever, zika virus and chikungunya in Mexico City, because the aedes aegypti mosquito can only live in altitudes up to 1,700 meters above sea level and Mexico City sits above 2,200 meters. The most common form of dengue is not fatal. It is inconvenient, causes pain and there is no treatment. All that can be done is to protect oneself against mosquitoes. Secondly, chikungunya does not kill. Again, it causes pains but is not lethal. As for zika, eight out of 10 patients do not even present symptoms. It is most dangerous during pregnancies due to microcephaly. Q: What is the Ministry of Health doing to control these epidemics? A: We are doing what we can, but people travel and go to places where the mosquito is present and risk being infected. We are carrying out campaigns to warn people to protect themselves, to watch where children go and to sleep with a mosquito net, but it is not easy.

Mexico City has 135 clinics, 32 hospitals and 12 subway clinics, employing

about 37,000 personnel and caring for 22 million people every year

43


| VIEW FROM THE TOP

INFORMED PEOPLE CAN ACT AS HEALTH BRIGADE GERMÁN FAJARDO Medical Faculty Director of Universidad Nacional Autónoma de México (UNAM) 44

Q: What have been the most important developments the

strengthened by the new minister. Our country needs to

health sector has witnessed in 2016?

go from being a research consumer to a research producer,

A: Probably, the most important development the health

focusing on the needs of the Mexican population. Research

sector witnessed in the last year were the leadership

protocols, patent registration and development of clinical

changes in the three most important health federal

products need to increase. Publication efforts are not

institutions. The Ministry of Health, the IMSS and ISSSTE

enough. They need to be transformed into concrete

renewed their leadership, which suggests interesting

solutions.

changes in the health arena. AMIIF and COFEPRIS have played an important role in the The appointment of Dr. José Narro to the Ministry of

development of research. AMIIF has done a fine job in the

Health is particularly important since he is working to

past years increasing their membership to several new

resume the universal health approach Mexico is supposed

organizations and approaching health institutions for joint

to be looking for, a task that had long been neglected.

efforts, while COFEPRIS has named several universities

Unfortunately, sometimes people cannot be treated in the

and national institutes as third authorized research

nearest hospitals because those are not included in their

parties, which means they do not require the same

health coverage, forcing them to travel long distances to

amount of paperwork other institutions need for research

find a hospital that is included. The proposed changes are

protocols. UNAM’s School of Medicine is also committing

based on the exchange of services, meaning that federal

to expanding medical research by offering two degrees

and local institutions will work together to offer the best

focused on biomedical and clinical research.

possible services to citizens and that patients will be redirected to the clinics that best suit their conditions.

Q: Will the restoration of US-Cuban relations have an

That is our goal, opening the possibility for people to

impact on Mexico’s medical tourism industry?

access any government-funded hospital, regardless of

A: Cuba has high quality public health services and is

their health coverage specifics.

excelling in epidemiology programs and life-expectancy rates. But medical tourists are drawn to a different kind

The IMSS director is also focused on tackling problems

of medical services’ offering, an offering in which Mexico

ignored by his predecessors. For many years, high-school

is highly competitive. But medical tourism is more related

students and higher education students in public schools

to private-sector efforts rather than a government

have had access to IMSS’ services. Even though it is an

objective. Mexican authorities can help medical tourism

official disposition, many students do not possess a social

by guaranteeing the quality of the infrastructure, the

security number that would allow them access to IMSS’

hospitals, specialized clinics and doctors that focus on a

services. The IMSS’ new director is pushing an agenda

specific line of business.

that will allow all public education students to have a social security number. Young people accessing IMSS

Q: How do prevention campaigns contribute to the

services would automatically have access to programs

solution of public health threats?

such as PrevenIMSS or JuvenIMSS, contributing to the

A: One of Mexico’s biggest problems regarding public

consolidation of prevention culture.

health is the lack of prevention. Several conditions Mexicans suffer from can be easily prevented with changes

Q: How has the medical research field evolved in Mexico

in our lifestyle. Therefore our country needs to work on

over the past years?

prevention campaigns and efficient communication plans

A: The medical research field in Mexico has developed

that could help prevent many diseases. A good example

positively over the past few years. However, it needs to be

of this is the “Chécate, Mídete, Muévete” campaign IMSS


has been working on. I do not know if obesity rates have

population rather than waiting for the population to reach

decreased, but I do believe that people are more conscious

for them.

regarding obesity and its risks, especially children. People are becoming more aware of the necessity of

Prevention campaigns also work to stop the spreading

having healthy eating habits as well as the benefits of

of infectious diseases such as dengue fever, zika, and

performing physical activity. I do credit this awareness to

chikungunya. When people are informed they can act as

the campaign.

health brigades, taking the necessary measures to avoid its spread and making sure that their immediate environment

Another public health issue we are concerned with is

has the needed sanitary conditions. That is why it is vital to

the high rate of teenage pregnancy. Every year around

have assertive communication campaigns that encourage

7,000 girls, 14 years old or less, become mothers. This is

a culture of prevention.

an alarming rate. UNAM is working to launch a prevention campaign to decrease this alarming number. There needs

Q: When talking about universal health, how do we make

to be a joint effort with the federal government and the

sure that isolated communities receive adequate medical

Ministry of Health to make sure we are reaching the youth

attention?

in the country and providing them with all the necessary

A: In theory, every Mexican can access health services

information regarding pregnancy. Teenagers need to

through different types of health coverage. Around 70

have access to birth control methods and to realize the

million Mexicans have access to IMSS’ services, some 12

consequences unwanted pregnancies at a young age can

million Mexicans have access to ISSSTE and around 50

bring. If we want this campaign to be effective we need

million people have Seguro Popular. Regarding coverage

to design effective communication techniques to reach

services, we could say that every Mexican can access them.

the entire population. This means providing information

If people do not have any kind of coverage it is because

to every community in the country, urban, rural and

they are unaware of this, which means the government has

indigenous. It is a matter of bringing health services to the

been unable to communicate its message.

45


| VIEW FROM THE TOP

HEALTH EDUCATION FOR DOCTORS AND PATIENTS CÉSAR ATHIÉ Director General of Hospital General de México 46

Q: How is the General Hospital of Mexico managing

we prefer to invest in curative medicine to avoid

challenges from the industry?

expensive complications. Technology is another challenge

A: The hospital is a grand example due to its huge size, 45

as equipment quickly becomes obsolete. We find that

specialties and unique three level division. Primary care

renting equipment makes much more sense than buying

is emphasized on the first floor where general doctors

it. It is a cost-effective method that keeps our devices up

diagnose patients and refer them to the more specialized

to date.

second and third floors or specialty clinics. The second level treats 90 percent of the most frequent pathologies while

Q: How has Hospital General maintained its quality in a

the top floor oversees the remaining 10 percent, reserved for

landscape brimming with budget cuts?

the most complex conditions in need of medical surgeons.

A: Our income comes from the federal budget, Seguro

The hospital has a heavy surgical load and we handle all

Popular and other agencies. We receive an abundance of

types of cases. Disease is managed mostly through medical

support because the hospital manages the biggest chunk

care and complemented by education and research.

of the pathological cookie in Mexico. Some of our cases and convalescence rooms are covered by Seguro Popular. We

We take pride in the quality our hospital offers and work

offer important qualitative and quantitative information as

hard to keep up with medical innovation that can improve

our size and the number of cases we treat give an accurate

our services. The health sector is constantly undergoing

glimpse of what is happening in the country when it comes

changes thanks to the evolution of illnesses and the

to health.

consequent adaptation of treatment. The hospital also receives external support from visionaries Curative

and

preventive

medicine

have

equally

who grant donations on their own or upon request. Some

experienced dramatic shifts, which make the transition

lend a hand by buying or renting our equipment. For

that much more difficult. As our budget is quite limited,

instance, patients that undergo kidney or liver transplants receive support from the Carlos Slim Foundation, which

“Curative and preventive medicine have equally experienced dramatic shifts,

sponsors subsequent costs. Q: Mexico spends 6.2 percent of its GDP on its healthcare system, yet only 8-10 percent is assigned to medicine and administrative expenses carry the biggest weight. What

which make the transition

is being done to prioritize patients over administrative

that much more difficult. As

A: The organizational structure of the hospital is constantly

our budget is quite limited,

important piece of the puzzle that lessens administrative

we prefer to invest in curative

productivity and quality. We are constantly evaluating

medicine to avoid expensive

processes in the HGM? under revision and modernization. New technology is an hassles. The changes in our system reap higher rates of and receiving feedback to assure best practices. Our three levels of care and specialties are molded according

complications”

to the needs of the country and our patients, which are

Cesar Athié, Director General of Hospital

resources priority as it straightens out the dents in medical

General de México

care. Accurate diagnostics and adequate treatment are

constantly changing. Hospital General also gives human


essential to minimizing complications, which can only be

A: The Hospital General de México is 111 years old. The

achieved with a coordinated and prepared staff.

hospital has European origins and when it was created in 1905, the tendency was to develop horizontal clinics. In

We are starting to focus on minimally invasive surgery

this century, horizontal buildings are inefficient and the

as it is the largest type of surgery in the hospital,

hospital is pushing toward verticalization. The first tower

particularly laparoscopic. Our studies found that patients

was for oncology, the second for surgery. We are working

are in need of smaller hospitals. We are finding ways to

on finishing another three by the end of the year. A project

optimize our patients’ stays and save them time. The

is also being developed to sew together the units with their

new buildings and towers are starting to be managed

associated services. We made sure that construction did

as outpatient areas and short-stay areas for minimally

not obstruct the flow of the Hospital by relocating the staff

invasive surgeries.

to other sections to continue operations. The advantage is we have better installations and surgeons.

Q: What strategy does the hospital use to attract the best qualified surgeons, considering the health industry suffers

Q: How would you describe your most outstanding success

from a lack of doctors and nurses?

stories?

A: Hospital General has no issues when it comes to

A: The hospital considers rehabilitation cases to be

specialized doctors, as it handles their training through

some of the most outstanding, especially if the patient is

UNAM, the IPN and other private universities. Depending

young and has a bright future. Complications are always

on the needs of the hospitals, we even send doctors to be

a possibility. The loss of a body part requires transplants,

educated abroad.

an extremely difficult procedure that is now possible thanks to our new equipment. Some patients have critical

The real issue is the availability of specialized nurses, a

pathologies like placenta accreta, a condition where

worldwide conundrum. Our best nurses are prepared

the placenta attaches itself to the uterus. It can cause

inside the hospital at a school we hope to expand. We

uncontrollable bleeding and has a high mortality rate. We

also have general nurses that jump from being trainees to

have learned strategies that minimize risk in these cases.

professionals. Unfortunately, Mexico is experiencing a drain

For instance, a small caesarean incision can take out a

of nurses to Canada.

product that is passed to interventional radiology, while leaving the placenta attached to the uterus. The arteries

Q: How does the Hospital emphasize the importance of

that feed the uterus are then treated to stop the bleeding

general doctors?

and remove the entire uterus without losing more than one

A: Our entire first floor is dedicated to general doctors that

liter of blood, ultimately saving the patient’s life. Pregnancy

form part of our training program. Many do not have enough

complications are a challenge in Mexico as premature

expertise and we help them become family practitioners.

pregnancy is a health epidemic. Our latest case involved a

Afterward, we focus on internists who are doctors with a

nine-year-old girl from the streets.

higher level of preparation. From this group, cardiologists and heart surgeons among others, are trained.

Q: As a main teaching hospital in Mexico, what is the role of education in medicine and how can the public and

The hospital avoids many problems by developing its own

private sectors collaborate to promote more academic

experts through training cycles with the help of its modern

participation?

infrastructure. The relationship has mutual benefits as the

A: The hospital believes that a country cannot grow without

doctors grow professionally and pass on their knowledge

education, particularly rural areas that lack services.

to the hospital’s 782 medical residents.

Paradigms need to be broken to allow comprehensive educational programs. Education can solve many problems

The hospital makes sure to prepare itself by equipping its

within Mexican society such as obesity, hypertension and

general doctors with enough knowledge to serve efficiently

diabetes. The health sector can help by offering tools

on the first floor. We have plenty of specialists and worry

and improving quality of life for the general population.

more about having trained staff in primary care, as incorrect

We receive many patients with advanced cases of breast

evaluations can cause a hurricane of complications, and

cancer that could have been prevented.

costs. Improving the quality of primary care is vital. At HGM we run a patient university, a program inspired Q: Recently, MX$730 million (US$38.8 million) was invested

by places like Barcelona and Stanford where patients are

in a new surgical tower and the development of other new

taught self-care practices for a wide variety of illnesses. We

cardiology and rehabilitation units is being financed. What

place them in classrooms so that they can share information

other expansion plans is the hospital considering?

and experiences in pairs, similar to AA groups.

47


| VIEW FROM THE TOP

ABC HOSPITALS COMMITS TO HEALTHCARE IMPROVEMENT ALEJANDRO ALFONSO CEO of ABC Hospitals and President of the National Association of Private Hospitals 48

Q: As President of the National Association for Private

non-governmental organizations are funded by private

Hospitals, how are you planning to strengthen the sector?

hospitals, insurance companies, the government, and

A: I spend most of my time meeting with local and federal

pharmaceutical corporations, among others.

authorities including the General Health Council (CSG), which is one of the most relevant organizations involved

On the contrary, the CSG is subject to administrative

in the creation of Mexican healthcare policies. We discuss

changes at the end of each term, constantly losing its

issues related to medical tourism, its quality, and areas of

experienced personnel and know-how. We should also

improvement. Attracting patients from abroad is mostly

take into account that CSG audits are free of charge

contingent on the quality of service. Unfortunately,

whereas similar JCI processes cost up to US$200,000. JCI

many non-certified physicians provide unsafe services

is highly experienced in researching and analyzing quality

throughout the country. Therefore, the CSG aims to create

standards, which is a missing practice at CSG. Private

a network of certified specialists, ensuring patient safety

sector investment is crucial in creating a solution as it can

along the care continuum. Due to the lack of standard

bring fundamental benefits to the entire sector. So far,

procedures and proper physicians’ credentials in Mexico

3-4 percent of Mexican private hospitals have received

foreign patients undergoing hip replacement surgeries

certifications, and most of Mexico’s private infrastructure

in Mexico realize that no service provider in their country

works without guaranteeing a quality standard. Medicine

is willing to offer rehabilitation therapy and follow up

has progressed impressively in the past few years, and

examinations. There are private hospitals bordering

today we can identify previously undetectable diseases.

the US that perform surgeries on obese patients, who

In addition, providing treatment to chronic diseases

should otherwise be carefully examined and selected for

patients is secured, ensuring them better quality of life.

bariatric intervention. Only 30 percent of patients filing

Creating a solid medical network with proper processes

applications at our obesity clinic are suitable candidates

and infrastructure is fundamental as a patient’s medical

for surgery, the remaining 70 percent are directed to

care could involve up to five physicians per diagnosis.

exercising, dieting, and enrolling in group therapy. Even if in the short term performing blanket surgeries without

Q: How is the Association addressing the lack of data

factoring individual circumstances may be lucrative, it will

sharing among hospitals on clinical outcomes?

eventually damage Mexico’s image. We must work hard on

A: This is a global trend that is not exclusive to Mexico.

standardizing methods and world-class procedures in the

A few weeks ago, the board of a public hospital held a

care chain. We do not expect much revenue in the short

meeting in which a figure for infection rate was presented

term but we will show the world Mexico’s ability to deliver

but there was no reference or baseline parameter that

high quality services in the long term.

could help interpret it. Failing to acknowledge medical mistakes is one of the industry’s biggest problems

Q: To what extent will the CSG certification help hospitals

involving indicators. By shifting the mentality, directors

improve their standards and image among foreign

could use data as a pathway to continuous improvement.

patients?

Secondly, leaders must inform their staff on how their

A: Although accreditation is a requirement guaranteeing

work affects indicators and realize that accountability and

patient safety the CSG has many auditing requirements

trust are two main issues in Mexico.

stressing the organization. We believe the accreditation process should be reallocated from the CSG to a capable

Q: What can be learned from ABC Hospitals experience in

and highly resourceful third party organization. Mexico

earning the JCI accreditation?

could then replicate models like the Joint Commission

A: We are an accredited JCI hospital but if inspections

International (JCI) and the Canadian Council. These

reveal there have been healthcare oversights we could


lose it. However, organizations do not understand that

life. We also have a Kardias program for congenital heart

accreditation serves as a means to an end, not an end in

diseases through which 100 surgeries were performed

itself. Nine years ago when we first became JCI certified

last year. This is an affiliate of Texas Children’s Hospital in

the process did not end there. The JCI accreditation is a

Houston, and is committed to providing the same quality

tool to improve, which has to be clearly understood by

of service in infant medical care. We have other initiatives

all members in an organization. Our mission is to serve

that address cleft palate, Parkinson’s disease, and

patients and improve their quality of life not retain an

kidney transplant. Last year, 90 kidney transplants were

accreditation.

completed and 30 of them were performed in Mexico’s most vulnerable population. Our initiative for Parkinson’s

Q: How would you justify investment in procurement

disease consists of treating the symptoms by positioning

when there is a growing concern about underutilized

electrodes in the patient’s brain. We have also carried out

beds?

hip replacements and bariatric surgeries for vulnerable

A: Both the public and private sectors struggle with

people. In fact, 7 percent of our revenue is invested in

this problem. Many politicians think that infrastructure

vulnerable groups and education, accounting for MX$350

development resolves many of the healthcare industry’s

million (US$18.8 million) each year.

challenges. But this approach worsens the problem. Scarce resources are used to build new hospitals and acquire

Q: What are your strategic plans for 2016?

equipment but there is still a lack in human talent. When a

A: We are in the process of building a new intensive care

new facility opens and starts operating the directors must

facility at our Observatorio Campus, which will include a

find qualified nurses, physicians and technicians, as well as

larger transplant unit and a palliative care unit. We will

implementing processes, best practices and international

further expand our hospital buildings in Santa Fe, installing

rules. Infrastructure is often used as a way to prove

specific equipment for the Kardias program, as by 2020

growth and investment in the sector but human talent

we expect to perform 400 surgeries for congenital heart

development must significantly advance. The Ministry

disease annually. We have plans to build eight additional

of Health should question whether Mexico has the right

operating rooms in Santa Fe totaling 14. We are projecting

people and processes in place, and whether purchasing

the opening of a third hospital in the northern region of

cutting-edge technology is actually going to solve the

Mexico City. We have two clinics in Mexico City including

current problems in the system. Once the issue is solved

breast imaging centers with laboratory, rehabilitation, and

then infrastructure expansion in healthcare services should

obesity treatment services. In our main building we have

be considered. We need to double the number of nurses

a simulation center that aims to stop the use of animals

over the next 10 years to satisfy the demand for services

for educational purposes turning to robots instead. Finally,

while providing staff with the right training courses and

our residency program for oncology and neurology is

qualifications. Considering medical and science advances,

growing. As of today, we have 180 residents in both

including

facilities, which we expect will increase in the short-term.

the

discovery

and

development

of

new

treatments, staff needs to be trained up to par. Q: To what extent is your teaching program supporting the development of the sector? A: We have a strong residency program as part of our partnership with ITESM’s School of Medicine. We will not see significant change unless we educate the new generation of physicians. We approach them in their late teens, starting their college education. Considering that many courses date back to 1970 we need to change physicians’ mindsets so they are able to face upcoming global and local challenges. Q: What is the scope of your social responsibility programs to improve the health of Mexico’s population? A: We have an extensive outreach program. We are creating a new plan solely focused on children. There is plenty of scientific data showing that the development of children will be negatively affected if they do not receive enough medical attention during the first three years of

We should take into account that CSG audits are free of charge whereas similar JCI

processes cost up to US$200,000

49


| MEXICAN HOSPITAL STATISTICS

hospitals in Mexico, giving it the second most hospitals

medical care for an ailment. Many do not visit primary

in Latin America behind the 6,954 hospitals in Brazil.

points of care at the first sign of illness or practice adequate

Twenty-nine percent of these hospitals perform over 200

prevention, putting a heavy burden on the country’s

procedures per year and on average, 270 procedures are

hospital infrastructure. There are 3,820 public and private

conducted per hospital per year.

On average hospitals

BREAKDOWN OF HOSPITALS BY NUMBER OF BEDS BREAKDOWN OF HOSPITALS BY# OF PROCEDURES

in Mexico

received 2,691 patient visits in 2014; hospitals in Peru received an average of 30,900 patient visits

36% Hospitals with <100 procedures hospital with <200 procedures 35% Hospitals with 100 - 199 procedures

AVERAGE NUMBER OF PROCEDURES PER HOSPITAL

PROCEDURES

120

Source: Global Health Intelligence

On average there are only

100

six computers per hospital in Mexico, compared to 33

80 60 40

computers per hospital in

Neurological

Thoratic

Spinal

Cardiovascular

Urology

Orthopedic

Other

General

20 0

29% Hospitals procedures hospital with with >200 100-199 procedures hospital with <100 procedures

OBGYN

50

Much of Mexico´s population will wait before seeking

Colombia

BREAKDOWN OF HOSPITALS BY NUMBER OF PROCEDURES OF HOSPITALS BREAKDOWN BY # OF BEDS

Source: Global Health Intelligence

81 percent of hospitals in Mexico have birthing rooms but only 70 percent of hospitals have newborn cribs

hospital with >100 beds 14% Hospitals with >100 beds 12% Hospitals withhospital 50 - 90 with beds50 - 90 beds 23% Hospitals with 20 - 49 beds hospital with 20-49 beds 36% Hospitals with < 20 beds Global Health Intelligence 2015 hospital Source: with <20 beds

Source: Global Health Intelligence


| VIEW FROM THE TOP

HOSPITALS JOINING THE MEDICAL TOURISM BOOM JAVIER ALUNI Director General and CEO at Hospitaria 51

Q: What opportunities can the medical tourism industry

tells our patients we are committed to their health and

take advantage of in Mexico?

safety. In nutrition we have the H Distinctive that the

A: Medical tourism receives much interest from the

Ministry of Tourism awards to establishments that comply

government and investment as it thrives in very specific

with the strictest hygiene rules regarding the management

locations. Border cities tend to be very economical. Other

of food. It includes food preparation, storage, and delivery.

important destinations are beach towns, so people can

We also have the Moderniza distinctive that certifies the

come for their medical procedures but also for a vacation.

management of food and beverages in the hospital.

It all depends on your area of influence and the money you can dedicate to medical procedures. Monterrey has

We are now looking to certify our emergency department

influence in the southern part of Texas. Hospitaria is not

by the Joint Commission. The team uses the latest

far from the border which makes us an attractive option

technology and we are looking for third party accreditation.

for people coming by car from the southern part of the US.

In preparation, we are sending groups of doctors and nurses to train in emergency room in Mexico City. Since

Medical procedures can be expensive in the US, so when

we will always have competition, our main strategy is to

people come to Mexico the currency helps make our

focus on three fundamental things: patient satisfaction,

procedures less costly, although this depends on the

fair prices and family satisfaction.

procedure and the specialty that patients require. Some specialties target middle or low income families in the US.

Q: What problems would you say should be Mexico’s

Other procedures such as aesthetic surgery are targeted

priority to overcome?

at middle or high-income families. For instance, a doctor

A: The biggest health issue in Mexico is the lack of

that operates in Houston and in Cancun can offer his or

preventive culture. Unfortunately, people do not go to

her patients aesthetic surgery in Cancun since it is more

the doctor to avoid having health issues, people go to the

affordable. This is not Hospitaria’s case. All our doctors

doctor once they are sick. That is why health campaigns

are Mexican and operate in Mexico. When we have foreign

are so important. We need to make people understand the

patients it is because they have searched specifically for

importance of prevention. We have somewhat succeeded

our doctors to treat them.

in convincing women about the importance of breast examinations, we now have to duplicate these efforts for

It is hard to determine the number of Hospitaria patients

other diseases. Hospitaria is playing its part in trying to

who come to Mexico for the sole purpose of medical

create a preventive culture. There needs to be a shift in the

tourism. Hospitals and medical centers must ask their

way people approach prevention.

patients to indicate their place of origin to measure the number of foreign patients whom we tend to. This allows

We have just opened the first urology clinic in Monterrey to

us to identify more clearly if we have a growing demand

prevent urinary infections. We also support the Women’s

for medical tourism.

Medical Center, focused on women and pregnancy and the Cancer and the Nutrition Center.

Q: What advantages does Hospitaria have over its competitors?

Q: What future projects has Hospitaria planned?

A: Hospitaria was created four years ago. It is an intelligent

A: Hospitaria’s plans include opening new specialties.

hospital, designed to provide comfort to our patients

We want to focus on hemodynamics, heart procedures,

and their families. We have just received the CSG Health

neurosurgery and traumatology. We want to expand

Certification, which is not yet mandatory. We are among

Hospitaria not only in Monterrey but to many different

the first 100 hospitals to obtain this certification, which

cities of the country.


52


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53


| VIEW FROM THE TOP

SPECIALIZED CARE ATTRACTS PATIENTS FROM AFAR FRANCISCO VILLARREAL Medical Director of Swiss Hospital 54

Q: What is the origin of Swiss Hospital?

It has multiple universities with thriving health faculties,

A: The original concept behind Swiss Hospital was to

such as Monterrey’s Technological Institute of Higher

create a specialized environment that focused on specific

Education (ITESM), Monterrey’s University (UDEM), the

services. We first targeted and attracted our clientele

Autonomous University of Nuevo Leon (UANL) and the

based on previous evaluations that helped us foresee

University of Montemorelos. For many years the city has

the ailments in highest demand. It was decided that

developed important medical human capital for the whole

Swiss Hospital would be a small, secondary healthcare

country, but most importantly for Monterrey.

hospital focusing on certain medical surgery specialties. We kept away from tertiary healthcare practices that

Q: Swiss Hospital provides its patients and family

include cardiovascular and oncological surgeries and

members with a warm experience, based on innovation,

neurosurgical care. Swiss Hospital wanted to retain the

safety and excellence. How have you ensured these three

best doctors in the region in well-defined specialty areas

principals?

including orthopedics and traumatology.

A: We are constantly re-evaluating the infrastructure we have and making investments and refurbishments if need

Q: What are the results of Swiss Hospital’s specialist

be. In terms of patient safety, our indicators speak for

approach?

themselves. For example, over the last four months, we

A: By becoming a center of excellence in its fields, both

have seen 0 percent post-operative infection rates. In 2016

the hospital and its physicians could be a reference point

as a whole, we have had 0.6 percent. As such, we have been

in Mexico. From an orthopedic standpoint, Swiss Hospital

entrusted by patients and doctors that our epidemiologic

attracted the best spine, shoulder, knee and hand specialists.

vigilance is of the highest standard. Swiss Hospital has never had a post-operative thromboembolism, and

Given the success of our specialty approach we were

minimal surgical reoperations. On average, the hospital

able to attract other types of surgeons, such as bariatric

sees 160 surgical interventions per month in a total of four

specialists. We added this service to our operations and

operating rooms. Swiss Hospital is equipped with 24 beds

expanded the demographics of our patients, which only

with an occupational average of 70 percent, which is the

boosted our success rate. In fact after only two and a half

industry norm. Most of our services are ambulatory but

years in the market, we broke even and started profiting

hospital stays are on average 2 1/2 days.

from our operations. This is especially remarkable for hospitals, as the initial investment and subsequent

Q: How close is Swiss Hospital to reaching its goal of

financing is extremely high. Months later and after further

being a specialty reference in the region?

evaluations, peripheral and central vascular surgery

A: We are receiving more and more patients from

followed. Finally, we complemented our services with

peripheral states. San Luis Potosi, Tamaulipas, and

urologic and otolaryngology (ENT) surgery. We needed

Zacatecas demand our orthopedic services the most.

the right infrastructure to support our specialty areas,

Our obesity specialists see most of their patients

which led us to heavily invest in our intensive care unit

coming from Monterrey and Texas. Even though there

and other complementary services such as blood banks,

are highly specialized hospitals in the US, we have

laboratories and our imaging department.

detected an important area of opportunity. Take MD Anderson Cancer Center for example, one of the best

Q: How did Swiss Hospital attracts and retains the best

oncology hospitals in the world. They do not refer

specialists in the area?

patients to Swiss Hospital but we have seen Mexicans

A: Monterrey has differentiated itself from other cities

initially seeking treatment at this cancer center to whom

around Mexico, leading to its status as “the city of health.”

we offer follow-up services.


| VIEW FROM THE TOP

A NEED TO IMPROVE INSURANCE LEVELS IN PATIENTS ROBERTO BONILLA General Director of Hospital San Ă ngel Inn 55

Q: What strategy is Hospital San Ă ngel Inn following to

There is no general strategy for controlling obesity in the

consolidate its presence in Mexico City?

country. If the government and private enterprises team

A: The past few years were marked by several hospital

up, perhaps we could come up with a solution that could

acquisitions, mostly big hospital groups acquiring small or

have a bigger impact on the country. The government

medium-size hospitals. Hospital San Ă ngel Inn has been

needs to take advantage of the number of tools that

fortunate enough to maintain its independence. We have

technology provides. Performing free examinations in the

always been part of Grupo Dalinde but we are autonomous

city and in isolated locations is not enough, they need to

in decision making. Our business philosophy has always

conduct follow-ups on the diagnosis. Technology allows us

been to focus on the service we provide to our patients

to perform a more specialized follow-up.

and doctors. We provide quality services to our patients. Our general hospitals can tend to 100 percent of patient

Q: How do epidemiology cases in private hospitals differ

conditions and we are considerably more affordable than

from the ones you see in public hospitals?

other hospitals as our prices are approximately 30 percent

A: The epidemiologic composition in private hospitals is

lower than the most important hospital groups.

very different than the one in public hospitals. In our case, most of our surgical procedures are elective surgery. In

Our advantages make us attractive to corporate clients.

most private hospitals elective surgeries tend to be related

Enterprises sign contracts with us for coverage for their

to general, orthopedic, urologic and plastic surgery.

employees. We are among the top establishments for

Influenza cases are also among the variety we attend too

institutional accounts.

and last year we attended more influenza cases than in 2009. Due to our alliances our patients are diverse and

Q: What joint efforts could private hospitals and the

suffer from many different conditions.

government make to reduce obesity levels? A: Obesity problems have to be treated from a more integral

Q: How can you overcome the challenges private hospitals

perspective favoring preventive schemes rather than just

face?

reactive solutions. Unfortunately hospitals only attend

A: A challenge we usually face is the never ending struggle

the most serious cases in which the patient is suffering

between insurance companies and hospitals. Hospitals

from known complications. The private sector is offering

think insurance companies do not want to pay for their

interesting possibilities for the treatment of patients with

services and insurance companies believe the hospitals

obesity. There are personalized programs that, with the

are charging for unnecessary procedures. We need to

guidance of a health coach, aim to inform and educate

understand that we are reaching the same markets and we

patients on healthy lifestyles and eating habits.

have the same clients. Hospitals and insurance companies need to work on innovative business models to allow us to

Diabetes and obesity are conditions that can be prevented

tend to more patients at a lower cost.

by promoting healthier lifestyles. Hospitals do not play a very important role in terms of promoting those. As a

We need to change the idea that more medical choices

hospital, what we have done is work with our corporate

on insurance coverage equates to better coverage. This is

accounts to create prevention campaigns for their

inefficient for insurance companies since it has become

employees, assigning them health coaches to conduct

extremely expensive to have hundreds of doctors listed as

constant follow-ups of biomarkers. The information is

options. Having fewer options is not appealing to patients but

registered in a database that allows us to monitor our

this traditional model only increases costs for companies and

patients and to distinguish the specific treatments we

for the patient. A change in the way we approach medical

provide that have the bigger impact.

coverage could help us implement more economical services.


| VIEW FROM THE TOP

HEALTHCARE PROVIDER WITH THREE SIMULTANEOUS CERTIFICATIONS 56

Arturo Martínez Medical Director of Hospital Galenia

Olivia Laviada Sales & Medical Tourism Manager of Hospital Galenia

Q: Can you give us a brief history of Hospital Galenia’s

have to remain valid health care providers with the

operations?

CSG certification. Furthermore, if we were to provide

AM: After assessing the local market Dr. Eduardo Loya, the

subrogated services to social security health services'

Director General of Hospital Galenia, realized that Cancun

covered patients (IMSS and ISSSTE), we would have to

needed a high-quality hospital that could cover a growing

keep the certification. Patients are not necessarily aware

health service demand. Although this market generated

of our certifications but they recognize the difference in

higher margins treating foreign patients, Hospital Galenia

patient experience.

targeted the needs of locals. To date, 60 percent of our work is directed at local residents. We are the only

Q: How have Hospital Galenia’s certifications impacted

hospital in the Yucatan peninsula with nuclear medicine

medical tourism?

infrastructure so we also attract patients from neighboring

OL: Hospital Galenia has become Cancun’s reference for

states. Health necessities have shifted over the last years,

healthcare services, leading to an upsurge in medical

and so has Hospital Galenia’s approach. In Mexico, chronic

tourists visiting the city and our facility. Third party

degenerative diseases have become the biggest health

administrators, insurance companies and facilitators,

concern. These include diabetes, hypertension and most

mostly look for certifications, as they ensure patient safety

importantly cancer. As globally infectious diseases are

and treatment outcome. Those paying from their own

no longer the primary cause of death and Cancun is an

pockets are more focused on cost. These two variants are

attractive center for retired professionals over the age of

contingent on the procedure, considering some are not

60, most of our operations treat chronic conditions.

covered by insurers, such as plastic or bariatric surgeries. As a result, part of our job is to make patients understand

Q: How close is Hospital Galenia to fulfilling its goal of

the cost-benefit of Hospital Galenia.

becoming regional leader in quality, security, and service? AM: What Hospital Galenia has done in recent years

Canadian patients that receive free healthcare in their

and the effect it has had on its community are the best

homeland even travel abroad to avoid waiting lists of up

indicators. Firstly, we went from 20 beds to 54 after

to two years. For the most part, medical tourists look for

opening the second wing of the hospital. We have

plastic, orthopedic, general and bariatric surgery, as well

increased operating rooms, coupled with increased luxury

as oncologic and prostate cancer treatments. Stem cell

room availability. Our intensive care unit also underwent an

treatments are not authorized in the US, forcing some US

expansion process. As a hospital that uses opportunities to

citizens to travel to Mexico and obtain the ambulatory

reinvest and shows healthy financial outcomes, while also

procedure. When we first began operations, we developed a

covering the service demand, we must be doing things

prostate cancer program that was in high demand by foreign

right. Hospital Galenia is the only healthcare provider in

patients. Thereafter patient admission volumes grew.

the country with three simultaneous certifications, and an array of yearly re-certifications. Firstly, we hold the

The hospital developed the medical tourism division in

General Health Council (CSG) certification in Mexico,

2013, which forced us to be more organized and trace

followed by the Joint Commission International (JCI)

down protocols. We also created the facilitator figure,

and the diamond certification emitted by Accreditation

a position that helps us link foreign patients and third

Canada International. We not only comply with domestic

party administrators with the hospital. The patient’s

standards but also with international requirements.

only responsibility is filling in the admission form after providing us with a copy of their passport. We coordinate

A significant number of local and foreign patients use

their

pre-operative,

their private insurance in Mexico and as a hospital we

schedule if needed.

operative

and

post-operative


| VIEW FROM THE TOP

FIRST OF ITS KIND LUIS NAVARRETE Director General of Clínica de Mérida 57

Q: What motivated Clínica de Mérida to establish its

Q: What is the main demographic you treat, and how are

practice?

you able to support them economically?

A: In Yucatan, when we started 50 percent of the

A: About 70 percent of our patients come from the

population was not enrolled in IMSS, ISSSTE, or any other

Yucatan peninsula, but we also get business from South

governmental plan. Nevertheless, private healthcare costs

American countries and other states within Mexico.

were prohibitively high, so our clinic was a sound option

Although there are other hospitals in Merida, our size,

for this demographic. The construction of the Clínica de

expertise and mentality make the Clínica de Mérida stand

Mérida hospital began in 1961, and completed in 1964. The

out. Patients come from all over the peninsula, including

project was the vision of a group of doctors led by Arturo

Playa del Carmen Cancun, and even Cozumel, reaching us

Ponce G. Cantón, who raised the funds for the clinic.

by boat. This speaks volumes about our service.

In its 52 years of operations, none of the 200 partners in the

The dominating demographic is the middle to lower end of

clinic have taken dividends, making it a completely non-

the socioeconomic spectrum, but we also cater to higher

profit organization. The clinic was the first of its kind to

income sectors. Patients often seek a second opinion

reinvest profits into operations and technology. Moreover,

from Clínica de Mérida on more complex diseases such

medical professionals were given the opportunity to

as cancer. We help the lower socio-economic classes with

develop their skills and gain experience while offering a

a third-party payment we offer, which reduces the stress

more affordable price for their services. At the time of

related to financing treatment.

construction, no other private institution offered the same specializations for doctors and adhered to world-class

Q: How are you encouraging medical tourism from

standards. Today, we see between 600-700 patients and

countries such as Canada, the US and South America?

carry out around 400 surgeries per month, 50 percent

A: We see few medical tourists from Canada and the US,

being outpatient surgeries. This equates to around 55

although the number of Canadians, some of whom own

occupied beds per day. About 42 percent of our patients

vacation homes in Mexico, has been increasing. Few of

are funded through a third party, including insurance

our patients travel especially for health services but when

companies, bank loans, the Universidad Autónoma de

they visit family or their holiday homes they see local

Yucatán or other institutions that offer healthcare.

services as a reliable option. People also are increasingly coming to the Yucatan peninsula for six months or more,

Q: Aside from price, what attracts patients to Clínica de

so it is only natural that in that time they would require

Mérida instead of its competitors?

healthcare.

A: We have 65 SensAble beds, another 35 standard beds, a staff of 120 doctors, and a great deal of technology such as

Q: How do you plan to develop Clínica de Mérida in the

an ECT machine, hemodynamics systems and tomography

short term?

machines. We can carry out laparoscopy surgery, heart

A: As the city grows, the traffic and transport links become

surgery, transplants, ultrasounds, and invasive radiology,

more complex, complicating travel for some residents to

among other procedures. We also have a top of the line

reach the Clínica de Mérida. We intend to expand to the

laboratory to test all our samples. Doctors have a great

north of the city. There are also plans to establish units

deal of input into our hospital’s management. Instead

outside of the city. A laboratory in Motul is currently being

of competing with surrounding hospitals, we consider

built and also we aim to expand to Valladolid and other

ourselves part of a healthcare network. If a treatment costs

rural towns. Limited logistics options mean that we are

less in another institution, we will provide this information

unlikely to establish more hospitals but rather implement

to the patient.

units to support rural communities.


| VIEW FROM THE TOP

CODY DRILLS INTO DIFFICULT DENTAL CASES ROBERTO SOSA Leading Maxillofacial Surgeon and Founder of Central Odontológica de Yucatán (CODY) 58

Q: What distinguishes CODY from its competitors?

due to incoming foreign patients. We do not raise our

A: CODY employs highly specialized personnel and

prices for patients coming from abroad. Foreign patients

technology, such that the quality of our work is first-rate.

mostly request dental implants to take advantage

In Merida we have become a reference point thanks to our

of our prices and guaranteed quality service. Some

state of the art equipment. When dentists cannot solve a

foreign patients ask for operative dentistry such as

patient’s problems, they refer them to us as we specialize

dental crowns, incrustations, and fillings. For our dental

in difficult cases. Our digital dental lab helps us make our

implants, we use Straumann, which we believe to be the

molds and dental crowns with an accuracy of microns,

best brand of its type. Most of the materials we use are

sometimes employing zirconium. CODY’s two milling

shipped from Europe, especially from Germany, Spain,

machines, maxillofacial scanner, and x-ray device are built

and Lichtenstein.

in Finland. In the case of any electrical failure, our power station immediately supplies the clinic with electricity and

Medical tourism is generating an impressive economic

we do not need to interrupt our services. Moreover, we

spillover so we must push to attract more foreign patients.

offer all our services at market price, which has always

We already have the Yucatan Health accreditation, and are

been CODY’s philosophy.

working with Canada to be certified by their standards as we are try to obtain the ISO certification. In terms of

However, it is very expensive for us to operate and offer

promoting ourselves, in September we will attend the

competitive costs to clients. We employ an extensive

Medical Tourism Trade Show in Canada, so we are preparing

personnel, including a maintenance crew, our specialists,

to tour Ottawa, Toronto and Montreal, visiting retirement

and four engineers so maintenance costs are also high.

centers and travel agencies to promote Yucatan Health,

Including periodic renovations, together these reduce our

and to promote the clinic. Most of our foreign patients

profit margin. Taxes in Yucatan total 2.4 percent of our

hear about us through recommendations. We need to

total invoicing to federal and state taxes. Our total revenue

expand this to appeal online to other potential patients by

corresponds to 10-15 percent of total billing, much of which

offering them service packages including transportation,

is reinvested in renovations to remain competitive. For

accommodation, translation services and of course dental

comparison purposes, in the US an implant crown is usually

services.

sold for US$3,000 and CODY is selling it for US$900. Q: How do you expect CODY to grow? Q: What opportunities in Mexico pushed you to open

A: By 2018, we will be operating a local clinic in the northern

CODY?

part of the city. We would like to open a dental clinic with a

A: CODY started 32 years ago to fulfill a personal dream,

more affordable concept, offering quality services at very

rather than a commercial venture. I wanted to achieve a

low costs. This clinic would focus on preventive odontology

radical change in dentist and patient mentality. In Mexico,

work and restorative works, meaning extractions, callous

a traditional dentist does not cover additional treatment

injuries, dental fillings and acrylic based prostheses.

such as orthodontics or surgery. Our idea was to consolidate all dental services in a single space, ensuring

To fulfill this, we need help from the state Ministry of Health

the quality of every procedure.

to allow students from colleges to work with us during their social service period. In the worst-case scenario, the

Q: To what extent has CODY benefited from increased

investment for this project would come from our pockets

medical tourism in the state of Yucatan?

because we are keen to implement the program. The clinic

A: There has been an increase in regular clients. Numbers

needs only a small profit margin to ensure operation and

have improved but our finances have not increased solely

future growth.


| VIEW FROM THE TOP

AMBULATORY SURGERY AN EASY PILL TO SWALLOW RICARDO BOJALIL CEO of ASMED 59

Q: What needs did ASMED identify in the Mexican market,

are poorly maintained and their medical technology is

leading to its establishment in the country?

irregularly refurbished. Under these circumstances, our

A: The gap between large and small hospitals in Mexico

operations have secured the best of both worlds. ASMED’s

was extensive, so much that we saw a gap in the market for

infrastructure is conveniently equipped and well suited to

a sustainable business model. ASMED differentiated itself

handle ambulatory low-risk procedures, while delivering

from the rest by inquiring about the Ambulatory Surgery

good value for the money.

Center (ASC) industry model. ASC has been implemented around the world but especially in the US. By providing

Q: How do you encourage doctors and hospitals to refer

proper surgical and medical services in a secure and cost

people to ASMED’s outpatient facilities?

effective manner, we have positioned ourselves solidly in

A: ASMED is a facilitator of positive health outcomes,

an extremely competitive field after only four years in the

which is sufficient to secure their attention. We accentuate

market.

our services’ convenience, coupled with high quality and cost effectiveness. We also provide infrastructure and

Even though the ASC model is new in Mexico, there are

secure processes needed to procure the best patient

some operating rooms (ORs) running outside hospitals in

outcomes, which we take a lot of pride in. Consequently,

the country. However, their professionalism is not up to par.

ASMED being the service of choice for both doctors and

Most lack sufficient certifications and stricter policies to

patients is our immediate goal.

secure COFEPRIS’ authorizations. Hospitals have a broad range of services, creating managerial and operational

We complement hospitals’ and other healthcare providers’

challenges. ASMED has established and maintained high

operations. Considering the large amounts of medical

standards due to its specific OR focus.

devices and state-of-the-art infrastructure they are equipped with, servicing ambulatory procedures is too

Q: How has demand for these services increased over the

expensive to be considered effective. Competing against

last four years?

tier 1 hospitals is not our goal. We prefer to work toward

A: We have seen sustained double and triple digit growth

improving patients’ and physicians’ overall approach to

on a yearly basis. New found niches have resulted in this

surgery.

type of market growth. However, we continue to work toward obtaining full consent and support from doctors.

Q: How has the company benefited from being certified

We are popular among insurance companies and major

by the General Health Council?

insured enterprises who purchase these policies. The

A: Being awarded the General Health Council’s certification

newly found interest in the ASC model is contingent on

is not our ultimate goal. We must continue to build on this

our top-notch quality and competitive prices, which we

and maintain what we have achieved in terms of quality,

continue to nourish. For instance, by choosing ASMED’s

safety, and hygiene. These practices range from simple

services, clients can save up to 40 percent on surgical-

sanitary principles to rigorous processes, in compliance

related costs.

with

international

standards.

The

certification

has

enhanced our performance and our internal monitoring, Despite having garnered significant success in the Mexican

consequently improving our standards. The certification

market, paradigm shifts are always a hard pill to swallow.

has helped us achieve our purpose, which is driven by high-

As such, reluctance from key players like doctors is not

quality service offerings and zero medical contingencies.

unexpected. The level of specialization in Mexican private

The enterprise is filing for international accreditation for

hospitals is remarkable, but their services are not accessible

specialized ambulatory surgical care, which no other

to all social strata. On the contrary, some small hospitals

company has been granted in Mexico.



BIG PHARMA

3

The pharmaceutical industry accounts for 4.5 percent of Mexican GDP, according to COFEPRIS. Innovation is an important factor for drug companies as patent expirations approach and companies are investing heavily in R&D in a race to produce the drugs the world and Mexico desperately need to fight chronic and degenerative diseases. Cardiovascular diseases, diabetes and cancer are three of the biggest killers in Mexico. A stable economy and a population of about 128 million with a growing middle class make the country a fertile market for drugs to fight those diseases.

Proximity to the US market and regulatory efforts to homogenize regulations between Mexico, Canada and the US, partners in the NAFTA trade pact, are drawing companies not only to sell but to manufacture products locally. As the second largest pharmaceutical market in Latin America, Mexico is also an important gateway to the Central and South American regions. This chapter will present insight into the big pharmaceutical companies, the innovative drugs they are working on and the regulatory changes they are responding to, as well as the ethical challenges arising from a growing need to research for the next cure.

61



| CHAPTER 3: BIG PHARMA 64

VIEW FROM THE TOP: Rodrigo Puga, Pfizer Mexico

65

VIEW FROM THE TOP: Alexis Serlin, Novartis

66

VIEW FROM THE TOP: Karel Fucikovsky, Pierre Fabre

68

VIEW FROM THE TOP: Miguel Salazar, Boehringer Ingelheim Mexico and Central America

69

VIEW FROM THE TOP: Francisco Kuri , Landsteiner Scientific

70

VIEW FROM THE TOP: Mario Sturion, Janssen Mexico

72

VIEW FROM THE TOP: Morten Vaupel, Novo Nordisk

74

VIEW FROM THE TOP: Elvin Penn, Amgen

76

VIEW FROM THE TOP: José Caamaño, Takeda

77

VIEW FROM THE TOP: Vincenzo D’Elia, Alfa Wassermann Mexico

78

VIEW FROM THE TOP: Francisco Millán, Cetifarma

80

VIEW FROM THE TOP: Enrique Martínez, IIIFAC

José Ferreyra, IIFAC

81

VIEW FROM THE TOP: Alberto Wicker, SignuFarma

82

VIEW FROM THE TOP: Carlos López, Productos Medix

82

VIEW FROM THE TOP: Rebeca Madrid, Medix Pharma

84

VIEW FROM THE TOP: Sandra Sánchez, PROBIOMED

63


| VIEW FROM THE TOP

MEXICAN R&D CONTRIBUTES TO INNOVATIVE DRUGS RODRIGO PUGA CEO of Pfizer Mexico 64

Q: What is the distribution of output from your Toluca

A: Annually, Pfizer invests around 17.8 percent of its

plant in terms of therapeutic areas and is there one

income in research to develop the cure of the future.

particular sector you would like to focus on, such as

In Mexico, US$16 million is invested every year. For

vaccines or infectious diseases?

Pfizer it is important to work for the benefit of patients

A: Overall, 45.5 million units from the plant are destined

and their health to improve their quality of life. With

for the internal market and 16.5 million units are exported.

65 years in Mexico, Pfizer is working to strengthen its

Of that, our pharmaceutical products include oral solids,

portfolio to offer our country an alternative therapy for

liquids, non sterile semisolids, including vitamins, and a

metastatic breast cancer. This has been shown to control

13-valent vaccine. The therapeutic areas we work in are:

the progress of the condition and made therapies less

biosimilars, cardiovascular, immunology, infectious diseases,

invasive, which is reflected in a better quality of life and

inflammation and pain, metabolic diseases, neuroscience,

care for the illness.

oncology, rare diseases, vaccines and internal medicine. Q: Recently Pfizer Mexico published a press release Q: Globally, Pfizer has said it devotes around 18 percent

discussing the large increase of GIST cancer diagnoses

of revenues to R&D. Is that percentage being reproduced

in Mexico. Is the company aiming to dip its feet into

in Mexico, taking advantage of the friendlier regulations

diagnostics

toward clinical trials in the country?

detection of the KIT gene receptor mutation?

A: In Mexico investment in R&D has risen to MX$288 million

A: We are working with civil organizations and we are

(US$15.3 million) in clinical research. To maximize new

interested in all that is related to illness to find better

research opportunities in biopharmaceuticals, Pfizer has

options of treatment through innovation. Due to Pfizer’s

two R&D departments: pharmatherapeutics, centered on

research, we have developed a treatment for patients with

the discovery of small molecules and related modalities,

this type of tumor, which brings hope for the fight against

and biotherpauetics, centered on big molecule research,

this illness.

technology,

such

as

helping

with

the

including vaccines. Q: What other areas of the chronic disease spectrum is Responding to global needs, at Pfizer we are working on a

Pfizer looking at from a business perspective?

new model to undertake the clinical research necessary for

A: Pfizer is developing therapies for chronic diseases such

our medicine, which implies collaborating with strategic

as rheumatoid arthritis and other rare diseases, including

partners known as clinical research organizations who are

Gaucher disease, hemophilia and mucopolysccharidosis.

now responsible for the clinical trials we are conducting.

We also work on the most important diseases in the country such as systemic arterial hypertension.

Q: How has this area progressed in the country since the 68 active research protocols you reported in 2013?

Q: Is cardiovascular disease, which is among the two main

A: We have 70 clinical trials underway and 842 randomized

causes of illness in Mexico along with diabetes, a priority

patients in different therapeutic areas such as biosimilars,

for Pfizer?

cardiovascular,

diseases,

A: Cardiovascular diseases can be asymptomatic in

inflammation and pain, metabolic diseases, neuroscience,

immunology,

infectious

initial phases so patients need strategies for early

oncology, rare diseases, vaccines and internal medicine.

detection and handling of risk factors and consequently morbidity and mortality caused by disease. Over the

Q: Are there any new investments planned in the country

past few years, Pfizer has been working on therapies

to increase capacity or to diversify the products offered

that significantly improve the quality of life of patients

by the company?

with cardiovascular conditions.


| VIEW FROM THE TOP

SHARED RISK MODEL LEADS TO INNOVATION ALEXIS SERLIN President and Director General of Novartis 65

Q: What is the strategy behind Novartis' restructuring,

All pharmaceutical products are either small chemical

and what benefits have you already seen?

molecules or biologic components. Novartis is taking

A: Novartis became a patient centric enterprise while also

the lead in innovation by investing in cellular therapy, for

building a new culture largely focused on innovation and

example targeting pediatric refractory leukemia which is

entrepreneurship. Novartis is a large company with a wide

a condition unsolved by science. Novartis extracts cells

portfolio, which called for a business unit partition. This

from a child’s body, adapts them to create affinity with the

has helped us increase our focus on sub-market segments,

cancer cells, and reinserts them in the patient’s system.

increasing our effectiveness in patient servicing. We

The immunological system recognizes its own cells and

are strong advocates of improving our outcomes and

multiplies them, directly attacking the cancer. Our tests

producing the evidence to back it up. Supplying patients

had an almost 100 percent success rate.

with drugs that are not needed will become an obsolete practice in the industry.

Q: Why is Novartis investing US$50 million in research in Mexico, and what will be the benefits to the company and

Q: What new drugs and products does Novartis have in

the country?

the pipeline and what conditions is it focused on?

A: Our science advancements are usually developed in

A: According to international healthcare analysts, our

key centers around the world. We are trying to expand

pharma division has one of the most robust pipelines in

our R&D footprint in Mexico. Novartis envisions its

the industry. Novartis recently received the largest FDA

Mexican operations partaking in the development of every

breakthrough designations for molecule development,

breakthrough molecule for the company. That is the type

which is the highest rating any molecule can attain. As

of relevance our subsidiary will have worldwide. Coupled

such, a large number of innovative drugs will be released

with our commitment to the country, COFEPRIS incentives

by the company in the near future. Novartis will launch a

made our decision much easier.

heart failure product in 2016. Our drug will reduce mortality by 20 percent, while hospitalization will be reduced by

Q: Novartis is one of the few pharma companies using a

21 percent. Heart conditions are the main cause of work

shared risk business model. What is the reason?

absenteeism as they result in death or serious deterioration

A: This is an integral part of our goal to become health

of the human body. Patients diagnosed with heart failure

partners of choice for key institutions. Novartis wants to

have a life expectancy of five years, which is less than

bring predictability to the resources institutions use. Our

some cancers. Unfortunately, innovation in this field was

drugs are so innovative, costs associated with the disease

absent over the last 10 years until Novartis decided to take

drop. By reducing hospitalization through prevention a

the lead.

large number of institutional resources are spared, largely compensating the medicine cost. The shared risk model

Novartis follows science and we try to be at the top of the

allows us to bring predictability to the next level. When

curve in creation. The mapping of the human genome is a

pharmacoeconomic models show the benefits of adopting

perfect example as it defines the type of molecules that

new technologies.

will be developed. Novartis has recognized the wide array of diseases that the human body can contract but there are

Novartis absorbs the risk. If pre-established outcomes are

only a few hundreds of molecular expansion mechanisms

not achieved we pay the incurred drug costs. If the goal is

that a disease can have. Novartis has identified the

reached, the costs are absorbed by the institution. So far,

pathways in which those diseases can penetrate, further

Novartis has signed over 10 cooperation agreements with

developing molecules that can intercept them, which can

key institutions, making us the fastest growing company in

be later applied to a broad number of conditions.

the segments we apply this methodology.


| VIEW FROM THE TOP

MATURE PRODUCT GROWTH TO GROW THE MARKET KAREL FUCIKOVSKY Director General of Pierre Fabre 66

Q: What have been the results of Pierre Fabre’s R&D

cancer treatments. Pierre Fabre has a strong commitment

investment in the last year in Mexico?

to continue delivering successful and novel therapeutic

A: In past years and most thoroughly following the company’s

alternatives on the field.

Corporate Strategic Plan “Trajectorie” 2018, Pierre Fabre’s Toulouse R&D cluster reshaped its focus on oncology and

Q: With what companies have you partnered up in Mexico

clinical dermatology. This major change has impacted

and which partnerships are you looking for?

our operations by designing a leaner R&D structure,

A: So far we have a three-year partnership with Janssen for

gaining efficiency and a positive turnover of capabilities

a specific pool of their women’s health products, which we

and deliveries. That being said, Mexico and LATAM have

will continue in the future. We are partnering with Ferring

significantly benefitted from novel drug introduction into

Pharmaceuticals, securing the local license for Lysteda® in

the market place, such as JAVLOR® and Hemagiol®, indicated

Mexico, indicated in heavy menstrual conditions. We are

for bladder cancer and hemangioma patients respectively.

also in active negotiations with a robust Swiss company

Hemagiol® is under registration process before regulatory

specializing in the oncology field. One of our company’s

agencies in both Mexico and Brazil.

strategic imperatives relies on the continued search for co-promotion agreements, licenses, distribution channels

Pierre Fabre continues to build strong partnerships in

and collaborations with other international pharmaceutical

the global oncology field due to its R&D and business

entities engaging in the oncology, woman’s health and

development focus. LATAM with Brazil and Mexico

orphan drug fields. Under these circumstances, multiple

in particular is a key region for the group as they will

companies are knocking on our doors and exploring

serve as main pillars for the success of this treatment in

potential partnerships with us.

following years. Q: What can be learned from Pierre Fabre’s different R&D Q: How big is the opportunity in the oncology field in

and business development path?

Mexico and what are the main drivers?

A: Big pharmaceutical companies have bet their future on

A: Chronic diseases will drive the demand and growth of new

biotech and high-end technologies, which we consider a

therapeutic alternatives, including high-specialty products.

strategical mistake. This approach leaves behind mature

As the Mexican population ages healthcare services

products on low investment divestment with carry over

have to adapt and satisfy evolving needs. Considering

capabilities, losing brand equity and critical mass.

private and public healthcare providers are equipped with a broader arsenal of techniques and diagnosis tools,

Companies underestimated the difficulties that LATAM

cancer diagnoses are systemically increasing in number.

emerging countries like Mexico would have in terms of

These tools allow treatments to begin at initial stages

market access, restrictions and regulations. The public

leading to more favorable therapeutic outcomes. There

sector has significantly downsized its budget, swiftly

has been a significant switch in resource allocation from

moving to generic substitution. As such, the environment

acute diseases to chronic and degenerative conditions.

for new molecules is becoming uncertain as both private

For instance, the PrevenIMSS campaign and infrastructure

and public companies are undergoing severe budgetary

development with the PrevenIMSS initiative is the clearest

constraints. Pierre Fabre is going against the current,

example of this.

completely trusting in its mature products. We decided to invest in their development while also securing co-

Mexico’s life expectancy must also be taken into account,

promotion opportunities. This has been a successful

which is 75 years for males and 77 years for females. As

strategy for us, allowing us to have an organic top line

such, this is the right time to develop strong capabilities in

growth of 51 percent over the last four years.


Large pharmaceutical companies are often commanded

web channels and points of sale, such as Farmacias San

and motivated by their global headquarters, which are

Pablo and other department stores. Mexico is Pierre Fabre

not well acquainted with local trends. Although focusing

group’s main affiliate in a vast range of products and

on high-technology products and medical devices is

brands within the segment.

understandable, Mexico’s access barriers are complex. Lacking a local partner to support an access strategy could

Q: What are your expectations for the dermocosmetic

easily result in failure. The pharmaceutical industry and its

market in Mexico?

landscape has significantly changed since 2013, not only

A: Pierre Fabre’s slogan reads “From Health to Beauty”.

from a public perspective but also from a retail standpoint.

Covering both the health and beauty segments is truly a

For example, new players are constantly coming in while

core element to the company’s mission. We are one of the

old ones exit the market. Strategies like the physicians at

few companies that has successfully serviced this broad

the point of sale have established themselves in Mexico,

spectrum.

with close to 25,000 operating in the country. The dermocosmetic market is extremely dynamic and Q: What is Mexico’s relevance for the company’s cosmetic

continues to foster new emerging companies, products

and consumer products?

and strategic alliances. The dermocosmetic market is

A: Growth will be fairly easy considering Pierre Fabre’s

also switching toward an aesthetics approach. As a

vast experience and expertise in the segment. We will do

result, products and their combinations will have better

this not only by re-inventing our brand portfolio and their

therapeutic and cosmetic outcomes such as the combined

components but also by listening and understanding our

use of the botulinum toxin and dermal fillers. This

consumers’ needs. Pierre Fabre has developed a consistent

phenomenon is creating more awareness for end users,

communication strategy to reach consumers through

patients and consumers.

67


| VIEW FROM THE TOP

MEXICAN MINDSET UNDERPINS GROWTH MIGUEL SALAZAR President and Country Managing Director of Boehringer Ingelheim Mexico and Central America 68

Q: What are the highlights of your new plant?

A: Mexico has quality, trustworthiness and reliability of

A: As one of Boehringer Ingelheim’s top 10 units,

processes and products. Our corporate authorities think

Boehringer Ingelheim Mexico has influence over decisions,

beyond the quarterly reports of the markets as we are

one of which was to designate Boehringer Ingelheim

privately owned. We are much more prepared for the

Mexico as a strategic global production hub for the world.

long term. We have demonstrated that with sufficient

This is due to the quality of production. We are still the

empowerment, we are able to deliver quality products in

only Mexican pharmaceutical company allowed to export

addition to timely sales.

veterinary, OTC and prescription drugs to the US. We have been approved by the FDA since 1998. We have one of

Q: What were the reasons behind the decision to invest

Boehringer Ingelheim’s five strategic plants across the

more in your veterinary division?

world. Ours will be specialized in diabetes and our import-

A: Worldwide, there are two areas of innovation in

export volumes will increase.

Boehringer Ingelheim. One is human pharmaceuticals and the other is veterinary health products. We are

Q: How do you adapt to the changing economic

convinced our animal health business is going to double

landscape?

rapidly in terms of size. We plan to invest and transform

A: A distinctive characteristic of Boehringer Ingelheim is

the products, becoming the number one company in the

the way we plan for the future. We do not plan in terms

Mexican market. Hopefully this will happen by 2017.

of euros, dollars or pesos. We think in terms of how many patients can benefit from our treatments. We are very

Q: What are your new investment plans?

clear. We do not do everything; we concentrate on specific

A: We are going to increase our investment in animal

therapeutic areas in line with the Mexican population

health tremendously and we are looking to almost double

and aging. Diabetes, oncology, respiratory diseases and

our infrastructure. In terms of human pharmaceutical

cardiology are clear areas of focus. Our strategy is not to

products, we will be expanding our diabetes range by

diversify but to concentrate. However, we must overcome

three to five products over the next three years. We are

many hurdles, mostly related to access.

going to be launching CNS products by 2018. We are the highest ranked manufacturer of biosimilars in the world.

The government is proposing budget cuts and we

We will also be delivering a large number of products for

are trying to help them assess those from a different

oncology.

perspective since they could adversely affect patients. The population is getting older. The problem lies within

Q: What challenges have you encountered from the

the costly impact of diseases in the elderly. We must plan

structural change in COFEPRIS and how do you convince

for this as a country. Boehringer Ingelheim is investing

public institutions to opt for your innovative products?

heavily in ethical and compliant ways of providing access

A: The changes in COFEPRIS have been well received.

to patients, independently of whether they are in the

The commissioner and his predecessor share a passion for

government, the private sector, with or without insurance,

simplifying things. That is good news for the country. The

in urban centers or in rural areas. The idea is to allow as

commissioner is open to innovation and other alternatives

many patients as possible to have access to our products

such as biosimilars. We have discussed this topic with him

if those products are suitable for them.

extensively and we think he has the right mindset but he also knows it is not an executive decision he can take. He

Q: What advantages of the Mexican market allowed

must create a multi-disciplinary team with different points

you to become the ninth top subsidiary in Boehringer

of view and perspectives. I think this is the strength of

Ingelheim?

COFEPRIS today.


| VIEW FROM THE TOP

SPECIALTY DRUGS A PRIORITY FOR LOCAL GIANT FRANCISCO KURI Director of New Developments at Landsteiner Scientific 69

Q: What is the strategy behind the double digit growth

A: We were involved in the development of the new

for Landsteiner Scientific?

regulations for these products in Mexico as the government

A: In 2014 we started exporting to some countries in

got fully involved in discussions with academia and the

Central America, such as Guatemala and El Salvador,

industry to develop a world-class normativity. Clear

which are very close to Mexico and eager to have our

regulations and guidelines were essential to ensuring

medications. Before that, Landsteiner was only focused on

quality, safety and efficacy of all biotechnology products,

the local market. COFEPRIS has signed several recognition

whether innovative or biosimilar. This was not properly

agreements in the region, and we are capitalizing on that

established before and regulators argue that patient

to consolidate our export business. We are working with

safety was in jeopardy. The new regulation will therefore

nine countries in Central and South America, as well as the

segregate between large and small companies according

Caribbean. Also, we are finishing a new manufacturing site

to their ability to comply with new requirements,

in Toluca, State of Mexico, where some of our operations

arguably resulting in a decreasing number of companies

started in October 2015, giving us the chance to produce

commercializing biocomparables.

and process many more drugs. We are going to transfer all of our production lines to this new site while our current

Q: How do you foresee the competitive landscape of the

facility will undergo some renovations to exclusively use it

biopharmaceutical business?

to manufacture high-specialty products requiring separate facilities. High-specialty drugs and biotechnology are

A: International players have long been interested in

a priority area for Landsteiner and we want to cover

entering the Mexican market and now that having

ophthalmology, oncology and hormonal products.

a manufacturing plant in the country is no longer a requirement to commercialize pharmaceutical products,

Q: What are your latest developments in areas such as

obtaining product registration in the country is much

genomic medicine and oncology?

more accessible. Nevertheless, public institutions are the

A: We have different projects with a subsidiary of

main buyers of high-specialty drugs and to be allowed to

Landsteiner in Spain that is fully dedicated to genomic

participate in a tender companies have to demonstrate

medicine research. It has three research lines including

that 70 percent of the added value activities of a

obesity, colon cancer and Alzheimer’s disease. Colon

product were done in Mexico. Producers not located in

cancer is one of the most common types of cancer in the

Mexico have to find a way to demonstrate this national

US, while in Mexico prostate cancer is highly prevalent

integration through partnerships with local players for

among men. Alzheimer’s is still underdiagnosed in Mexico

either manufacturing, clinical development, marketing,

and being highly difficult to treat, our researchers have

distribution or commercialization.

identified candidate molecules for drug development. We expect to have the authorization for preclinical studies

Q: What do you want to achieve in 2016?

of two potential obesity drugs this year. Next year we

A: Landsteiner has had a broad line of products so it can

will conduct clinical studies in Mexico. Spain has good

provide physicians with alternatives for whatever need.

infrastructure and expertise in genomics. There is a huge

This has helped us to get a position within the healthcare

database for the Caucasian population in this Spanish

system but now we want to specialize in certain areas.

center and we want to know if their findings also apply to

We want to organize our pipeline per therapeutic lines

Mexico through our genomics division.

including obesity, cancer, ophthalmology, anemia and so on. We are aiming to grow in biotechnology and in other

Q: How can companies capitalize on the opportunity the

products, such as new combinations and we want to

new regulation for biosimilars is bringing?

strengthen our presence in the private market.


| VIEW FROM THE TOP

PUTTING PATIENT WELFARE FIRST MARIO STURION Director General of Janssen Mexico 70

Q: What goals have you set as Director General of Janssen?

been demonstrated that improvements in healthcare

A: Aligned with our pharma group strategy, we continue to

and expanding access to innovative medicines can

focus on innovation to prolong and improve the lifespan of

improve productivity. We are investing in robust medical

Mexican patients. As the pharma market has evolved over

educational programs as the pace of innovation is very

time, the competitive advantage will come only by bringing

fast. Our commitment is to ensure the correct use of new

true medical innovation that generates an impact on patient

products. They should treat the right patient with the

lives. In Mexico the approach is the same: to introduce and

correct dosage, indication and with the precise method

provide access to innovative therapies. As an industry

of administration.

and country we face several challenges in healthcare. We must attract and retain the best talent as they are the main

Q: What perception shift have you seen in governmental

element to success. We have a set of values we live by.

institutions in putting prevention ahead of cost?

These values indicate that our first responsibility is to the

A: Everyone agrees that investing in prevention is the

patients and consumers of our products, followed by our

better long-term strategy in healthcare but the execution

employees and the communities where we live. By getting

is complex. The earlier you detect and act in healthcare

that right, our shareholders should also receive a fair return.

the better the outcome. Janssen established the Disease

We live by our values and they are taken into account in our

Interception Accelerator in early 2015, an innovative

decision making processes.

platform focused on leading a shift from diagnosis and treatment of disease to one of prediction and pre-emption.

Q: How is it possible to put patients at the center of a

We began in type 1 diabetes and have since initiated

healthcare system and what should big pharmaceutical

additional ventures in presbyopia, perinatal depression

companies do to push for this?

and, most recently, oropharyngeal cancer. The pharma

A: We have been working with Mexican Institutions to help

industry needs to help to provide the right perspective

bring clinical trials to the country. Those trials will also

when evaluating innovation and move from a limited

contribute to develop hospitals and centers of excellence

view of cost to a more broad vision of value for the whole

in Mexico. In this way, the medical community, nurses and

system.

researchers will have the opportunity to work with the best support in their medical field and Mexican patients can be

Q: What can you tell us about the program you have in

included in trials with the newest treatments available. The

place with UNAM in terms of scientific investigation and

pharmaceutical industry must continue to work to show

human capital?

the value of new innovative treatments and how they can

A: In 2014 Janssen Mexico signed a collaboration agreement

transform Mexican patient’s lives.

with the UNAM in order to develop scientific research in the country. One of the new strategic elements in our

Q: What are the main obstacles the new drugs you

Global Research and Development group is that we will

launched have faced in in the Mexican market?

augment our internal research with external innovation by

A: As an industry we need to do more to demonstrate

implementing open innovation and building collaborations

the value of our products. Therapies that will extend a

with leading scientists in the world. Universities are great

patient’s life reduce the total cost to treat a patient by

sources of talent. This partnership can allow UNAM to

avoiding further hospitalization, surgeries, co-medications

interact with our R&D, medical affairs and clinical operation

and other medical intervention costs. Capturing those

teams.

benefits requires a significant effort in emerging markets due to lack of information, fragmented healthcare

Q: What can you tell us about the social programs you

services and limited electronic patient records. It has

have put in place?


A: In 2016 we received the Socially Responsible Enterprise

Q: What new projects do you have on the way?

(ESR) recognition for the 15th year in a row. It represents

A: We are confident of the impact our new wave of

our commitment to social responsibility. It is part of our

innovative treatments can bring to patients. Janssen is

core values, we are responsible for the communities we

well-positioned to drive continued annual growth until 2019

live and work with. Worldwide, navigating healthcare can

above the industry average. Our plan is to file more than 10

sometimes be difficult and some people need help when

new molecular entities and more than 40 line extensions

they are most vulnerable with a disease. Patient support

by 2019, demonstrating industry-leading R&D productivity.

programs like Enlaces in Mexico help patients under treatment by providing them with services, education

New treatments for diabetes are an unmet medical need

and tools. This is a trend in the industry, especially when

in Mexico. We are going to launch this year a fixed dose

patients with chronic diseases and under treatment

combination of canagliflozin and metformin, a new

with innovative drugs require special care to take the

class of drug that uses the kidneys to release glucose.

treatment such as injections or small procedures. They

We will continue our efforts in the area of oncology and

can get the treatment from well-trained healthcare

hematology to launch two new products in 2016 and more

professionals with the necessary equipment and receive

in 2017-2019. We have just received regulatory approval for

nutritional support.

bendamustine in Mexico for hematologic indications. We have a new immunology product in oncology for multiple

Creative psychological interventions such as art therapy

myeloma. Our commitment to neuroscience is reinforced by

are widely used in combination with drugs to help patients

the upcoming introduction of a long-acting injectable drug

with schizophrenic diseases. Janssen Mexico has developed

to treat schizophrenia, which requires only four injections

and sponsored a painting contest called “Sensibilidad sin

a year. We recently received regulatory approval for a new

Límites”, a long-term commitment to provide an additional

combination of drugs to help patients with HIV.

incentive to patients under art therapy. Our corporate vision: “Caring for the world, one person at a Janssen has developed the short story contest called “¿Te

time inspires and unites the people of Janssen Pharmaceutical

cuento mi cuento?” for children with diagnosed attention

Company of Johnson & Johnson. We embrace research and

deficit disorder with hyperactivity, aimed at recognizing

science bringing innovative ideas, products and services to

creativity and imagination and to reduce disease stigma.

advance the health and well-being of people.”

Innovation. Imagine the possibilities. At Janssen, we have big dreams. We imagine a time when diseases can be treated before people feel sick. When those in need can access life saving medicines, no matter where they are. And when treatment options are so convenient people can spend more time doing what they love. It’s about radically challenging the way diseases are thought of, dealt with, prevented and intercepted. Now, and in the future. By collaborating with the brightest minds in every field, we’re turning big visions into game-changing solutions. Because patients are waiting. We are Janssen. We collaborate with the world for the health of everyone in it. Learn more at www.janssen.com.mx

Janssen Cilag, S.A. de C.V. © JC, S.A. de C.V 2016 The image depicted contains models and is being used for illustrative purposes only.

71


| VIEW FROM THE TOP

PREVENTION CAN MINIMIZE DIABETES EPIDEMIC MORTEN VAUPEL VP & Director General of Novo Nordisk 72

Q: What impact has Mexico had on the company’s core

prevention would minimize the epidemic. We want to

global business and its plans for the market?

be a responsible partner with the public sector to raise

A: The state of obesity and diabetes in Mexico made it a

awareness and to implement initiatives to support change.

core market for Novo Nordisk. The company has invested

We offer medication and print publications and reports in

heavily in our operations in the last five to six years. This

collaboration with the Federal and Mexico City Ministry

effort has been rewarded. The company has climbed from

of Health. Those publications involve an annual report

eighth or ninth in the private diabetes market to number

and magazines that explain the impact of obesity on a

three. Evidently this also pushed us to strengthen our

person’s health. It is interesting to evaluate the facts of

position in the global diabetes market. In the last four

obesity to understand why it is now considered a chronic

years, we have grown in double digits and we expect

disease instead of a lifestyle issue or simple risk factor. Our

to continue to do so in coming years. To do so we must

investigations even explore the financial impact of obesity

continue to raise our market position. Our clients are

on society, like the implications of Mexican investment in

balanced between the private and public sector but we

obesity complications.

are particularly proud to be the biggest supplier of human Q: What trends do you expect will reign in the next

insulin to the public sector.

decade in obesity and diabetes? Q: On top of the government campaigns to raise

A: Optimistically, we hope the country has reached a peak

awareness, what support does Novo Nordisk offer to

in obesity and diabetes. Mexico has one of the youngest

combat diabetes?

populations in the world and as birth rates have dropped

A: As 70 percent of the population qualifies as overweight

we may see an aging generation and an increase in type

or obese, increasing numbers of diabetes cases are

2 diabetes. Realistically however, if we break the habit

unavoidable.

several

among younger generations we may preempt diabetes

years of untreated overweight or obesity, interlinking

Type

2

diabetes

results

from

resulting from long-term obesity. The government is

the two issues. Therefore, overweight and obesity

dedicating sufficient attention to the issue, following the previous Minister of Health’s diabetes and obesity strategy published three years ago. President Peña Nieto supported this and simply recognizing the disease as a problem for the country has raised awareness. With education, prevention and strong treatment, Novo Nordisk can declare cautious optimism for the obesity issue facing Mexico. Q: What are the advantages that Mexico could present to companies interested in investing in the health industry?

Around 20 percent of patients in Mexico go to the hospital for treatment of chronic diseases such as diabetes

A: Mexico is an excellent location for clinical trials. Novo Nordisk has quintupled its staff working in clinical trials in the last five years and has increased the number of trials and patients enrolled in them. We expect 2016 to close with 10 clinical trials and next year seven more are scheduled. This number will continue to increase, concentrating on private clinics that host our trials. Costs are competitive in the country and our company has invested considerably


in this area in Mexico. The regulatory authorities recognize

increased our prices by that quantity. However, our belief

the benefits of a proportion of the local population

that the Mexican economy is sound has meant that we will

testing a drug, as it helps them feel safer authorizing the

allow fluctuations and trust that the underlying economy

medication.

will cause the peso to recover its value. We will keep our price developments modest as always regardless of

Novo Nordisk has doubled the size of its organization in

inflation. While this will temporarily affect our bottom line,

Mexico in five years, exemplifying the importance of the

it will protect our patients from drastic price increases of

market for our company. Our investment in clinical trials

medication they depend on.

is supported by product launches. Seven products in the pipeline to treat type 1 and 2 diabetes will likely be tested

Every year we launch a new compound. Our existing

in Mexico. Some of these products, such as semaglutide,

insulin has been on the market for 15 years, but we recently

treat both diabetes and obesity. Our trials catering

launched an update called Tresiba速 that works for longer

to obesity and diabetes are largely tested in Mexico,

and has fewer side effects. Ryzodeg速, another release,

though we do not yet have plans to introduce hemophilia

is a fast acting drug with the basal insulin component

treatments to clinical trials in the country. These will play a

that diabetes patients can take when they eat. This year

part in our expansion plans.

Saxenda速 was introduced to the market to target obesity and product launches are planned for items like Xultophy速

Q: How does the company expect to expand in light of

next year and in 2018. This once-a-day injection has

recent global changes to increase market penetration?

passed clinical trials. While we are the third company in

A: The peso has lost approximately 30 percent of its value

the market, in the long term we hope our new products

against the dollar in the last year, so we ought to have

will help Novo Nordisk to lead the market.

73


| VIEW FROM THE TOP

INVESTMENT OPPORTUNITIES IN BIOTECH ELVIN PENN Director General of Amgen 74

Q: Amgen has one of the most remarkable portfolios

Q: What market needs are you aiming to satisfy in the

in the pharmaceutical industry. What new products do

Mexican market with your upcoming products?

you have in the pipeline?

A: We will launch an important cardiovascular disease

A: We have been present in Mexico since 2006 with our

drug – the first biologic to be approved worldwide

R&D operations and we started commercializing our

for the treatment of hypercholesterolemia. This is a

products in 2009. We have launched 10 products to the

monoclonal antibody that aims to cover a significant

market and eight are already included in the National

portion of the Mexican population. As we know, obesity

Basic Formulary. The main focus of our company is

and hypercholesterolemia are prevalent diseases in the

innovation and we keep investing in R&D. Last year

country and this medicine will target LDL cholesterol

we devoted 19 percent of global revenue to this area,

levels in patients who are uncontrolled. We are certain

accounting for US$3.9 billion worldwide, and focusing

that our new medicine will set up a revolutionary trend

mainly on oncology, hematology, bone health and

in the treatment of high cholesterol.

nephrology. At this point we have 20 new molecules in the pipeline, some of which are already in phase III trials.

Q: What barriers do you think your product Evolocumab will have to overcome to gain access to the public

Q: What role are emerging markets such as Mexico

sector?

playing in the company’s growth?

A: Mexico is a very important market but still has much

A: Amgen is present in more than 100 countries and we

room to improve access to innovation in the public sector.

expect Mexico to continue growing as it is the second

Equivalence agreements between COFEPRIS, the FDA

largest market in Latin America after Brazil. We are

and EMA have made drug approvals more expedite. But

focused on innovation and increasing access.

the public sector can further improve patients’ access to high-specialty drugs since a new drug can still take

Q: How much local and multinational competition do

up to four years to be included on institutional basic

you see in the Mexican biopharmaceutical market?

formularies. All players in the healthcare sector have to

A:

Biotechnology

is

continuously

growing

in

the

work in collaboration to improve this situation. We are

pharmaceutical industry at a faster pace than chemical

committed to continue working with local authorities to

entities. Data from FUNSALUD show that the ratio of

improve the timelines for both approval and access to

biotechnology products to chemical entities is 3:1, hence

innovative drugs.

we expect this segment to continue growing. According to COFEPRIS, 35 percent of the drugs that are approved in

Q: To what extent are Mexican product registrations

Mexico are biologics and we assume this to be a sustainable

already recognized in other countries?

trend. Moreover, biologics account for around 30 percent

A: COFEPRIS has signed equivalence agreements not

of the products undergoing clinical development.

only with the FDA and EMA but also with other Latin American countries. This does not mean all products

“Mexico’s potential to grow

registered in Mexico can immediately enter other

in clinical research is very

Regulatory recognition among countries is evolving

promising compared to other countries” Elvin Penn, Director General of Amgen

markets in the region but the process is actually faster. and will certainly play a much more relevant role in upcoming years. Q: What sort of patients should be prescribed with Evolocumab?


A: High cholesterol has been traditionally treated with

we will keep focusing on our R&D operations. Amgen

statins. There is still a need in the market because there

has invested more than MX$300 million and we have

are many high-risk patients with uncontrolled levels of

18 ongoing clinical trials in important centers such as

cholesterol despite being on a statin regime. Genetic

INCMNSZ and La Raza. Our new treatment for high

diseases such as familial hypercholesterolemia are also

cholesterol is also going to be on top of our agenda

a good target for this new treatment, as well as patients

thanks to the opportunity it offers to control cholesterol

with statin intolerance. This medicine represents a unique

levels. Mexico’s potential to grow in clinical research is

opportunity for both patients and healthcare professionals.

very promising compared to other countries. We have to make sure this medicine gets to Mexico and physicians

Q: Innovative biotech drugs are perceived as expensive

use it as soon as possible. Mexico is a very important

treatments in the public sector, which is always pushing

market for the global pharmaceutical industry because of

for lower costs, how are you going to valuate this new

its huge population, and we see a significant opportunity

drug in the market?

to increase our investment in clinical trials. Mexico’s

A:

The

potential to grow in clinical research is very promising

development of a new medicine can take more than 10

Innovation

requires

significant

investment.

compared to other countries. The industry is investing

years of work and between US$1 billion to US$2 billion, so

US$160 million in clinical research in the country today,

these efforts must be compensated to continue existing.

and there is potential to increase that investment up to

Healthcare institutions also have to realize that in most

US$5 billion in 10 years.

cases, innovation represents savings in the long term as new treatments solve medical problems faster and more effectively. Ensuring ROI is crucial in the biotech industry given that patent expirations are likely to be followed by the launch of biosimilars. When this happens, the system can increase savings because costs go down, whereas innovative companies have to ensure a continuous return. Amgen is committed to developing and launching biosimilars since they can cover a wider population, helping the healthcare system. These medicines require a significant effort to be developed because their comparability and effect has to be demonstrated through clinical

studies,

not

only

through

physicochemical

characterization methods. We expect to launch our first biosimilar in a couple of years in Mexico. Q: What are your biggest priorities for 2016? A: We will continue promoting our products and expanding access in the public market in Mexico. Also,

The development of a new medicine can take more than 10 years of work and

between US$1 billion to US$2 billion

75


| VIEW FROM THE TOP

ACCESS TO MARKET VITAL TO SUCCESS JOSÉ CAAMAÑO Director General of Takeda 76

Q: Where does Mexico fit in Takeda’s transformation into

Q: How does the fragmentation of the healthcare system

a global company?

affect your strategy of putting patients at the center?

A: Mexico is among the top 10 countries for Takeda and it

A: We must seek better collaboration considering public

is extremely relevant to the company’s growth and global

institutions cover 90 percent of Mexico’s population. The

strategy. Gastro is Takeda’s most significant product line,

Mexican system consists of many institutions, each with

making it a leader in Mexico. It is also building its oncology

different policies and processes. We are building a solid

portfolio but market access is vital to the company’s

structure to adapt to each institution and to proactively

success. We have recently launched two products in this

accelerate our processes, which results in timely and

area, with two more in development. OTC products are an

efficient product availability for patients. This is a good

important element to our strategy, For diabetes we have

time for the private market, which can be seen by the

a hypertension drug and a DPP-4 inhibitor because one in

number of investors coming to Mexico. According to

two diabetic patients suffer from hypertension. In Mexico,

Business Monitor, Mexico is the third safest country

ferranin is a market leader and accounts for more than 20

to invest in Latin America, behind Chile and Uruguay.

percent of Takeda’s revenue stream.

Although these countries are more stable their market size is smaller. In addition, Mexico’s GDP will continue to

The company’s main social responsibility program focuses

grow by 2-3 percent in following years, making it the best

on anemia, with 54,000 units of ferranin administered to

private market to invest in.

over 40,000 Mexican children. Selling or licensing other specialty portfolios is also part of Takeda’s strategy,

Q: How are you collaborating with public institutions to

which was recently achieved with three main respiratory

improve market access so that more patients can benefit

products awarded to AstraZeneca. Considering vaccines

from your new medicines?

are part of our global core business, we are working with

A: We should not only be a supplier to the government but

Univercells to introduce new vaccines to the Mexican

allies and business partners focusing on the health of patients.

market, such as a new dengue vaccine undergoing clinical

Access to medicines plays a critical role in putting patients

phases II and III. The key stakeholders in the vaccine

at the center of the healthcare system. We are developing

industry are the WHO, PAHO and the government. We

new and unique risk-sharing models. This approach will help

expect to develop our vaccine unit in the mid to long

us collaborate and benefit larger volumes of patients with

term, while focusing on the GOODX strategy in the short

innovative medicines. Considering our products are directed

and midterm.

to niche market segments from catastrophic diseases, we must cover them through any institution, which cannot

Q: How has the culture of Takeda changed as part of the

happen without full alignment with the government.

process to become a company with global operations and standards?

Q: What do you want to achieve in 2016?

A: Transforming a company’s culture and incorporating

A: We are committed to launching six innovative products

new sets of values and beliefs takes between three to

over the next three years, which includes a first class drug

five years. Every decision we make must improve the life

for multiple myeloma, a medicine for hyperuricemia and a

quality of our customers. Putting patients at the center of

complement for our diabetes line. Takeda will be a largely

any pharmaceutical operation is no easy task as physicians

recognized company in Mexico, not only for its sales but

are considered direct clients for pharmaceutical firms but

also for its positive impact on both patients and society. We

physicians now serve as strategic allies. As we cannot

will receive the Great Place to Work certification by 2020,

directly talk to patients our collaboration with physicians

as well as the inclusion in Mexico’s top 100 ranking. We are

is that much more valuable to us.

building a brighter future for our stakeholders and patients.


| VIEW FROM THE TOP

WINNING MEXICO WITH AN EYE ON LATAM VINCENZO D’ELIA Director General of Alfa Wassermann Mexico 77

Q: What were the market opportunities that led

Q: What can you tell us about Alfa Wassermann’s online

Alfa Wassermann to Mexico and what has been the

Campus?

development of this subsidiary?

A: Through our e-learning platform we can train our sales

A: Alfa Wassermann is an Italian company whose initial

force in-house with an internally developed matrix. Alfa

focus was Europe. When the company decided to expand

Wassermann understands the importance of continuous

operations to Latin America, assessing the most viable

training and the Campus program ensures it. We will

entry market for the region was crucial, factoring the

continue to use this means of teaching to evaluate our

country’s economy, availability of capable human labor,

sales force’s performance and knowledge on a regular

political stability, tax law, regulatory issues and extensive

basis but the online Campus will never exclude face to face

distribution channels. Under those circumstances and

training. We have inserted content from clinical studies,

coupled with its growth potential, we realized Mexico was

helping our sales force understand medical conditions

the most attractive market. Domestic medical needs were

at a deeper level. In addition, we can keep track of our

aligned to Alfa Wassermann’s product offerings and so

sales force’s development and performance, helping us

Mexico became our Latin American point of origin.

produce a clear evaluation of each individual. Under these conditions, the impact of the Campus program has been

During the last decade, the pharmaceutical industry has

quite fruitful. Even though this is a Mexico initiative, other

undergone major changes in areas like regulatory practices,

global operations have developed a similar e-learning

market

distribution

platform. We expect to soon integrate them into a single

channels and healthcare providers. This new environment

access,

generic

development,

network and homogenously insert the solution to all

has impacted the industry’s growth, leaving clear winners

operations.

and losers. Alfa Wassermann has been quite successful in understanding this new scenario, implementing strategies

Q: How does the Mexican tendency to focus on generic

that helped it fall on the winning side. For instance, from

drugs affect Alfa Wassermann’s growth strategy and how

2012 to date, the company has had an average market

will the company face this hurdle?

evolution of 125 percent.

A: We do not compete directly with the generic segment because all of our products are still under patent. However,

Q: What are the main therapeutic areas Alfa Wasserman

their growth has undoubtedly impacted our operations,

is targeting?

eating away market share previously attributed to

A: Alfa Wassermann focuses mainly on gastroenterology

branded products. Alfa Wassermann plans years ahead

and peripheral vascular diseases. As of today, our biggest

of the potential arrival of a generic counterpart. As such,

blockbuster is Flonorm© but we plan to broaden our

we coordinate new product innovations and releases with

gastroenterology

patent expirations.

portfolio

with

new

products

and

innovations. The company invests 12 percent of its yearly revenue in R&D operations, keeping true to its DNA as

We also develop programs targeting our patients’ needs,

an innovative enterprise. Gastro will continue to be Alfa

adding benefits to our products before the arrival of a

Wassermann’s main therapeutic segment as becoming

given generic drug. To cover the growing competition,

the world leader in gastroenterology is its biggest goal.

as well as future product launches, the company has

We also can expect a future entry to cardio-metabolic

systemically increased its headcount on a yearly basis. As

and rheumatology-orthopedic segments. Mergers and

a newcomer in the Mexican market, Alfa Wassermann is on

company acquisitions will provide additional access to

the winning side of the industry. Still, we continue to work

new products and therapeutic areas, directly helping us

exhaustively to reach market share critical mass and brand

in this endeavor.

recognition.


| VIEW FROM THE TOP

ETHICAL GUIDELINES SUPPORT INDUSTRY GROWTH FRANCISCO MILLÁN Director General of Cetifarma 78

Q: What is the main purpose of Cetifarma in the Mexican

agreement between the pharmaceutical industry and the

industry?

medical societies of private and public hospitals.

A: Over 10 years, we developed a self-organization plan linked to the compliance of the ethical and deontological

The pharmaceutical industry also needs to establish criteria,

codes. Cetifarma has incorporated as members not only

indicators and standards on what can be considered quality

pharmaceutical companies that produce chemical or

medical training and how to certify our training.

natural medicines but also companies that manufacture medical devices. The decision to include medical devices

There is also a need to increase support for research and

manufacturers is related to non-infectious chronic diseases

clinical trials. The pharmaceutical industry is committed to

that

musculoskeletal

increasing investment in these two fields in our country.

system diseases are usually solved through the use of

affect

Mexicans.

For

example,

Cetifarma needs to make sure that every clinical trial that

prosthesis or special devices. Cardiovascular diseases are

is performed observes the ethical principles and guidelines

also common among Mexicans, including hypertension.

that have been accepted worldwide. Pharmaceutical

For this particular disease several medical devices have

companies that perform human trials need to respect their

been designed, such as cardiac pacemakers and stents.

patients’ autonomy and dignity. They also need to respect

The compliance of all our members with the ethical and

and comply with the decisions that ethics committees

deontological codes helps the industry to have a better

take regarding their procedures or products. Cetifarma

communication process, respecting the patients’ needs.

works closely with the National Commission of Bioethics, the institution that approves the conformation of research

Q: What are the main opportunities Cetifarma has

ethics committees in the private and public sector.

detected in the Mexican Industry? Q: There are several opportunities we have detected that

Another issue requiring our attention is the promotion of

would allow us to strengthen our self-regulation system.

a transparent culture within organizations. It is important

Cetifarma needs to take concrete action to reinforce its

that we make the effort to provide transparency on the

relation with medical societies. We need to work closely

interactions that take place between pharmaceutical

with physicians to make sure they comply with a code

enterprises and health professionals. Our objective is

of ethics so we can ensure the pharmaceutical industry

that by July 2017, individuals will be able to find reports

supports the training of health professionals that act

on the companies’ websites regarding the support and

according to ethical guidelines. There needs to be an

investment they have given to medical societies, to continuous medical training of interactions and to research

“Our objective is that by July

and clinical trials.

2017, individuals will be able to

The strengthening of consensus with stakeholders is

find reports on the companies’

transparency agreement with the General Health Council.

websites regarding the support

provide health services, national medicine academies

and investment they have given to medical societies” Francisco Millán, Director General of Cetifarma

also a point that needs attention. In 2007 we signed a Signatories were the sanitary authorities, institutions that of surgery and pediatrics, UNAM’s and IPN’s medical schools, the National Association of Private Hospitals and the National Medical School. This agreement allows a complementarity between authorities, professional health institutions and the pharmaceutical industry.


Another linking mechanism we are working on is an

world face. Our participation on international forums

agreement on co-regulation between the pharmaceutical

allows us to update constantly our practices and to

industry and the sanitary authorities. This agreement

improve them.

specifies that law abidance is tied to the compliance of ethical principles. The regulator entity must confirm the

Q: What is the ethical discussion that took place in Mexico

law is being followed and Cetifarma has the responsibility

regarding the usage and production of biotechnological

to confirm that ethical codes are being met. This

medicinal products?

agreement considers complementarity and information

A: The ethics discussion was focused on ensuring that

sharing between Cetifarma and the authorities.

the safety, quality and efficiency of biotechnological products are equivalent to those of the innovator. For this

Unfortunately, we have found that not every medical-

to happen, pharmaceutical companies that produce bio-

related entity complies with the necessary guidelines.

similar products must comply with the necessary norms.

When these cases are detected we are forced to apply

Not only the legislative conditions must be met but also

sanctions. In 2007 and 2009 we witnessed an important

the ethical commitment of providing products with the

increase in controversies. The increase arose because

same quality characteristics the sanitary authorities

those were the years that our conduct codes were

demanded from the branded product.

updated to meet international standards. This particular situation led Big Pharma companies to make adjustments

Unlike biochemical products, biotechnological medicines

to comply with international codes. Part of our job is to

involve the usage of biological molecules, which have a

work as a mediator when these situations arise between

less stable behavior than pharma chemicals. Therefore,

pharmaceutical enterprises.

the production process of biotechnological products must be controlled to ensure the quality and efficiency

The most important thing regarding the promotion of

of these products. The patient’s safety must always

an ethics culture is the prevention of practices that do

be the final purpose. It is important to recognize the

not comply with the codes. That is our mission: prevent

efforts made by the pharmaceutical industry, the medics,

through education and monitoring. For the monitoring

the authorities and organizations such as Cetifarma.

task, we have developed alongside the companies’

Medicines in the Mexican market comply with safety and

compliance officers a monitoring focused on probable

efficiency standards.

risks. For the model to work, the firms must identify the areas that are more prone of failing to meet the conduct code. Once they have been identified, the companies can take the necessary actions to prevent inappropriate conduct. Q: What is the extent of Cetifarma’s participation in the international arena? Q: Since 2006, Cetifarma is the only Latin American pharmaceutical association that has a seat at the IFPMA’s Code Compliance Network. On this compliance network are Big Pharma companies and self-regulation organisms, sharing experiences of the progress made in the obedience of conduct codes. Also, we were asked by the Ministry of Economy to participate in the drafting of ethical guidelines known as the Mexico City Principles, for the interaction of bio-pharmaceutical companies of the APEC region. Cetifarma is an active member of the working group of this region. Cetifarma also is a member of a Latin American Compliance Group that allows us to share information between countries

regarding

challenges

the

pharmaceutical

companies face in the region. The technical secretary of the IFPMA also participates in these meetings and shares information of the challenges that other regions in the

Cetifarma publishes ethics and deontology codes for several aspects of the pharmaceutical industry, covering

transparency to good advertising and publicity practices and also serves

as an arbiter in cases of disputes

79


| VIEW FROM THE TOP

INTEGRAL SERVICES LEAD PUBLIC SECTOR PURCHASING

80

Enrique MartĂ­nez Director General of the Pharmaceutical Innovation and Research Institute (IIIFAC)

JosĂŠ Ferreyra President of IIIFAC

Q: What information can pharmaceutical companies

EM: The concept of market access is also understood

obtain from the audits IIIFAC conducts?

differently by companies. A pharma-economic study is

EM: We conduct audits of the public sector market, the most

just one part of the process in developing a full health

important one being INEFAM-SP, which provides strategic

economics study but regardless of the results obtained we

information on pharmaceutical sales to that segment. This

know the studies will not guarantee access to institutions.

audit stands out for its comprehensive information, covering

An actual access strategy must include communicating

95 percent of market value and representing excellent

scientific knowledge to create understanding and demand.

input for pharmaceutical companies’ strategic decisions.

This is why companies have developed models to improve

Looking closely at the public sector is essential, considering

access through specialized human resources who are

that it accounts for more than 50 percent of the overall

knowledgeable of the public market and the differences

pharmaceutical market. On the other hand, our INEFAM-RX

among institutions. Within a company, coordinated efforts

audit generates data on the prescription market.

should be made by leaders opening the market and executives positioning the products. Different strategies

JF: The Mexican public healthcare system consists of

are required depending on the nature of the product

more than 150 public institutions or payers, which provide

such as generics, high specialty or orphan drugs. Other

healthcare services to more than 115 million Mexicans.

important factors are the targeted institutions and price.

These institutions have different purchasing habits, basic formularies and pricing lists, making drug acquisition

Q: What services are public institutions demanding with

highly complex. Basic formularies have different formulary

the rise of consolidated purchasing and subrogation?

codes for each medicine, and our mission is to help clients

JF: The practice of consolidated purchasing is standardizing

understand what products are acquired, at what price,

the sector. Decentralized institutions are acquiring integral

and who is providing them. While there can be a dominant

services for purchasing, storage and distribution of

player taking over IMSS and ISSSTE its presence can be

supplies, as well as the delivery of services directly related

weak in other states or institutions.

to the patient. Integrators also support institutions by managing sophisticated and expensive equipment along

Q: What are the most relevant purchasing behaviors of

with expert personnel. In addition, specialized services

public institutions regarding innovative drugs?

such as hemodialysis are being handled by third-party

EM: Institutions have their own drug review processes,

clinics today. This is changing market dynamics in such a

which duplicate the process executed by the General

way that pharmaceutical providers now have to negotiate

Health Council. They face the problem of allocating

with private companies holding subrogated services. These

resources to a specific medicine while divesting in other

kinds of services are now worth MX$20 billion (US$1.8

areas. Like any other healthcare system in the world, there

billion) and are growing significantly. This is an innovative

is a plethora of needs and scarce resources to satisfy

commercialization model and as declared by the Ministry

them. A study we conducted between 2009 and 2013

of Health the greatest demand for the industry is to stop

found there are medicines incorporated into the National

selling supplies and provide health services instead. The

Formulary that are still not acquired by any institution and

fact the market is demanding integral services and shared

sometimes they only buy 40 or 50 percent. In the case

risk models will make professionals understand how to

of biotech drugs, 111 out of 128 products were acquired

deliver value.

by public healthcare institutions between 2009 and 2014. EM: From 80-90 percent of sales of high specialty Q: Given the lack of resources in public institutions, how

medicines are made to government institutions so

can companies improve market access?

companies will have to face the challenge of adapting.


| VIEW FROM THE TOP

PATIENT COMPLIANCE TO REDUCE PHARMA LOSSES ALBERTO WICKER General Director of SignuFarma 81

Q: Where is the pharma industry heading?

companies. We have developed several tools, like a patient

A: In the pharma industry you cannot only provide

feedback program. We interview patients regarding their

medicine anymore. The industry is heading toward

quality of life improvements with treatment and then we

delivering the product along with support for the patient

deliver evidence-based results to the physician, for him to

to achieve the best outcome possible. In 1997, SignuFarma

see in real time and in the voice of their own patients the

started its integrated doctor-patient system. Many saw

positive outcomes. A common complaint from patients

this as just a temporary program to follow the trends at

is that they have difficulty finding the medication in

the time, but we saw that there wasn’t an answer to solve

pharmacies, so we have operated for the past nine years

the big problem, which was the large amount of money

a mail-order pharmacy to distribute medicine nationwide.

lost, around about 40 percent of the business the pharma industry loses because of lack of patient compliance.

Q: How can patients be sure their data is safe with the use

Patients need relevant material to help with their treatment

of these information-sharing apps?

so we have created several solutions. One is to accompany

A: We complete a tech-response paper that tells us the

the patient through their medical journey and treatment

needs of every company we work with. This document

to see what they truly need. They need patient education

says which firewalls and what technological protection

where they can learn what to expect from the treatment.

they will need for us to work with them. As everyone knows, data is never 100 percent protected but we use

Q: What are you doing to accomplish these goals?

cloud-based

A: We are taking advantage of technology such as

strong protection. Also our call centers have special

sophisticated and dynamic CRM programs that deliver

computers that block anyone from removing information

information to our clients in the pharmaceutical industry.

from them. All employees sign a confidentiality contract

We gather the information, put it in our apps and transfer

that bars them from giving any of this information to other

to our platform on a daily basis. We have an app for data

parties. About 95 percent of the patients have given their

managers that interview physicians about patients to

informed consent. And finally, the physicians also sign a

deliver the information to us. Another app is a disease

disclaimer that says the information collected can only be

management program for physicians. We deliver a tablet

used for the stated purposes.

encrypted

technologies

that

guarantee

to them and they add the information to collect in real time. We also have a patient app in development. With

Q: Who do you work with and who are you looking to

this technology, we have reached 95-97 percent patient

work with?

compliance, which means at least 95 percent of patients

A: We were pioneers with Pfizer for more than 10 years,

are compliant within 1-3 years. For the first time we have

BMS, Roche, Janssen, Lundbeck and Amgen, who we

developed an agreement that bases pay on positive

are working with and developing a strategy to deliver

patient outcomes. The average cost of treatment for a

biotech drugs to patients. We have worked with almost

patient is around MX$300,000 (US$16,000).

every international company in Mexico and abroad, and some national companies. Our next step is becoming more

Q: How do you give patients medical education and

technological. We would like to implement cost-effective

information?

ways to monitor the quality of life for patients using

A: Most of this first class medical information is sent by mail,

digital health. There are some new interesting devices

e-mail and sometimes with packages of medicine. There

on the market like a pill bottle that monitors medicine

are also many points to consider with compliance and

intake. We would also like to deploy a big program for the

regulatory laws to observe in COFEPRIS, so SignuFarma

government. To expand the benefits for more people, we

takes care of those things on behalf of pharmaceutical

need to be able to reach them through public institutions.


| VIEW FROM THE TOP

CREATING PERIPHERAL SOLUTIONS TO EXPAND REACH CARLOS LÓPEZ CEO of Productos Medix

82

Q: How has the company evolved in the Mexican market?

known as an integral drug provider, it also wants to service

A: Medix changed its business focus in 2006 concentrating

the industry through differentiated products. As such,

on

a

every new product release must have an added benefit,

pharmaceutical manufacturer and creating peripheral

the

overweight

and

obesity

fields.

We

are

which CIDEFARMA helps us develop. All in all, Medix’s

solutions that could help us expand our reach was part of

biggest differentiator is its integral treatment model,

our model. Our overweight and obesity crusade accounts

which we are constantly improving and polishing through

for 15 percent of our sales. It looks to build link-up programs

data gathering.

between companies and public institutions and to create health initiatives to fight the issue. We also imported a line

Q: What is Medix’s market share and how is brand

of meal replacements from the US called Medifast.

recognition in the Mexican market? A: We are the market leader in obesity and overweight

Q: How has CIDEFARMA helped in terms of creating

pharmaceuticals. We hold 47 percent of Mexico’s market

additional tools in the fight against obesity?

share, in addition to 50 percent Central America. The latter

A: We created the Center for Pharmaceutical Research

does not account for our most recent product releases in

and Development (CIDEFARMA) to help the company

Argentina and Brazil, which will boost brand recognition in

stay ahead of the innovation curve. Even though Medix is

Latin America. We are constantly expanding our product

| VIEW FROM THE TOP

PROMOTING DIAGNOSIS THROUGH FREE TREATMENT REBECA MADRID Corporate Commercial Director of Medix Pharma

Q: How has Medix Pharma’s business model changed with

Q: How have you managed to create a successful product

the surge of different treatment options, such as low-cost

portfolio in relation to your competitors?

pharmacies with free medical consults?

A: We are specialized in overweight and obese conditions.

A: In the past we had a very traditional business model.

We have a very broad portfolio with more than 13

Our sales representatives would go into a doctor’s

alternatives that can be customized and can work together

office and offer our product. But pharmacies with free

to create integral, personalized solutions for our patients.

medical offices generated an interesting change for the

We are expanding our product ranges due to the change in

pharmaceutical industry. This new model was initiated by

patient needs. We are seeing complications from obesity

generic drug pharmacies that notified patients looking for

we did not see in the past, such as venous insufficiency,

treatment.

spine and knee pain. Despite the need to grow our portfolio, we are not introducing OTC medication, we are

We started in public squares offering people the

not overriding doctors.

opportunity to know their weight, their glucose index and the possible risks they could face if they were overweight.

Among all the products we offer, we have two very

The idea was to present the solution to a problem many

successful products. Oblecox® and Redotex® are our best

people did not think they had.

positioned products, especially the latter. The success


and service portfolio, further improving our position as

A: Besides common distribution to pharmacy stores and

differentiated solution providers. Through the International

communication with general doctors, we have opened

Division, Medix is expanding its integral solutions to

other distribution channels. For instance, Medix evaluates

countries in the Latin American region. We have detected

and develops health programs with partnering companies,

a lack of specialized companies with enough history

helping its employees reach their desired weight. Medix

behind them and as a result we will continue to increase

also opened a Consumer Division, focusing on aesthetic

our presence in the region. Dominican Republic, Brazil,

and overweight issues, rather than in obesity. We want to

Paraguay, Argentina and Ecuador are among the markets

tackle the problem before it escalates and our Consumer

where Medix has a strong footprint.

Division offers that opportunity. Ten years ago, Medix was the fifth largest pharmaceutical manufacturer of

Q: Mexico suffers from the highest obesity margins in the

overweight and obesity products. Placing these ailments as

world. How can it improve?

the company’s core business gave way to its current market

A: Both overweight and obese conditions are complex

share, coupled with its integral business model. We have

issues that deeply impact the health of society. They

the largest portfolio of differentiated products for these

require specialized and individualized solutions, contrary

types of ailments, adding effectiveness to our treatments.

to common belief. Even though it may increase the intricacy of our treatments, it also adds effectiveness.

Q: How is Medix helping the industry create a preventive

The biggest misconception surrounding this type of

culture against obesity and overweight?

condition is that through diet and exercise everything can

A: Educating physicians and patients is the first step.

be fixed. Psychological and genetic propensities, labor

Unfortunately, not enough attention is given the preventive

requirements, cultural and family issues should be taken

scope of obesity, as academic institutions are more

into account by our health specialists.

focused on healing and remediation once the disease presents itself. Medix offers training programs through

Q: What are Medix’s distribution channels that are helping

its collaboration with the Latin American Institute against

it achieve 47 percent market share?

obesity and overweight.

of Redotex® can be explained by its efficiency in helping

the costs of obesity treatments for people with economic

people lose weight.

shortcomings.

Q: Why would you say that obesity’s rates have tripled in

If we expect to solve the obesity crisis, we need to increase

the past 10 years, making Mexico the leading country in

awareness and prevention campaigns. The Crusade is a

weight-related problems?

program focused on diagnosing employees from private and

A: The Mexican population’s lifestyle has played an

public enterprises for free. We conduct our diagnosis and

important role in obesity rates. Physical inactivity is more

we present the company with a general panorama of their

common than it used to be. I think that children’s obesity is

employees’ health and a working plan so we can help them to

related to crime problems. If a city has a high crime index

achieve an ideal health goal. We have worked with more than

parents will not allow children to go out and play and they

800 companies. The Crusade helps our obesity research and

will spend more hours sitting in front of a screen. Obesity

we are able to compile data from different people in different

problems are also due to purchasing power. Attending

places to better understand the psychological, metabolic,

a health club is very expensive so physical activity is

genetic and behavioral problems that lead to obesity.

becoming a luxury. It is also important to consider our eating habits. Our high sugar consumption is generating

Q: What joint efforts is Medix Pharma pursuing with the

increases in diabetes rates.

government to work on the obesity crisis? A: Mexico City’s government is our partner but Medix

As a country, we still have a lot to learn in terms of obesity

Pharma is expanding its alliances with several local

and poverty. Twelve percent of the population living below

governments for medical training. We are investing in

the poverty line also suffers from weight-related problems.

equipment donations for obesity-specialized clinics and

Reaching this sector is a problem we have not been able to

prevention campaigns. We promote the benefits of having

solve. An interesting possibility for treatment that needs to

a healthy lifestyle at government operated clinics and when

be explored is to create alliances between pharmaceuticals

there are government-organized sports events we attend

and government, committing both to cover a percentage of

them with our medical units to diagnose people for free.

83


| VIEW FROM THE TOP

BECOMING A GLOBAL MEXICAN COMPANY SANDRA SÁNCHEZ Director General of PROBIOMED 84

Q: How has PROBIOMED evolved with the implementation

no other company has. Having the right partner would

of corporate governance and what has the company

help us accelerate time to market and thereby hold a

achieved in this respect?

stronger position among actual and future incumbents.

A: At this point, we have well-defined processes through

For years we have relied on one team fully dedicated to

which our company objectives are set. We have set

developing new biosimilar products with no real pressure

and implemented the right policies, procedures, levels

on time to market as competition was scarce. This has

of authority, delegation of responsibilities and the

changed significantly, making it difficult to stay on top

organization we need based on our mission, vision and

of the game unless we further invest in R&D and develop

values. This goes hand in hand with balancing the interests

several biosimilars in parallel.

of key stakeholders, such as the shareholders, financers, customers, internal management and the government

Q: Apart from time to market, what other features are

We have put together a holistic approach to achieve solid

essential for a biotech company to remain competitive?

corporate governance. This is a step we needed to take

A: PROBIOMED’s competitive advantage relies on our

before moving forward in our search of a partner, raising

18-year experience in biosimilars. No other company in

capital or even considering a future IPO. Finding a strategic

Mexico has this, and Big Pharma innovative companies

ally rather than just investors is crucial for the future of the

have just recently tapped into this field. The biotechnology

company. Corporate governance strengthens the internal

innovators business model is very different from that

capabilities of PROBIOMED to build partnerships and

of biosimilar manufacturers and this will be a challenge

transforms the organization’s cultural mindset as we must

for them as they will have to adapt to achieve low-cost

ensure all 1,400 employees keep up. We are working toward

biosimilars, which is very different from selling high

obtaining the Great Place to Work (GPW) certification,

cost innovator medicines. Being vertically integrated,

which will only strengthen our market position. We are

controlling costs, ensuring high quality and delivering a

determined to become a global Mexican company and

better value proposition is easier at PROBIOMED. Today, all

we have already opened a few international markets but

biotechnology companies, both national and multinational

continuing with our corporate governance build-up plans,

in Mexico, either import API or finished product, making

complying with the new regulation standards in Mexico

cost control more complex as they are subject to import

and growing our sales base are our three most important

and cost variations from abroad. On the contrary,

priorities today.

PROBIOMED produces biosimilar drugs from gene to final product all in Mexican territory and our value proposition

Q: How will the right partner impact your competitive

will continue to be provisioning high quality at a low cost.

position in today’s biotechnology environment?

All institutions and patients globally are searching for this.

A: We are interested in creating partnerships locally or internationally but attracting capital is not as important

Q: To what extent has biosimilar characterization

as choosing the right partner. This aligns with our vision

progressed

and our goals as well as with the current business

capabilities?

environment. In the past, mainly Chinese and Indian

A: The development of infrastructure for biosimilar

companies participated in the biosimilar market but today

development, including characterization studies, has not

major pharmaceutical firms are entering. PROBIOMED

advanced in Mexico at the same speed as regulation. This is

has a business model whereby it invests 20 percent of its

understandable as the biosimilar market is just starting to

sales in R&D, the same level of investment as Big Pharma

be developed. The new regulation just came into effect in

companies. Our vertical integration in the biotechnology

February 2016. PROBIOMED has developed state-of-the-

arena represents a competitive advantage in Mexico that

art orthogonal analytical techniques given the embryonic

in

Mexico

in

terms

of

infrastructure


infrastructure available in Mexico across the R&D chain of

matures so will the requirements throughout the world

biosimilar development. Most analyses were conducted

to demonstrate the manufactured biosimilar products are

in-house with proprietary methods, which are in line and

high quality, safe and effective, placing more emphasis

are validated to comply with NOM 257 standards and

on the chemical and physical composition of the

requirements. Characterization has been performed in

medicinal product and less on redundant and expensive

collaboration with Mexican universities and academia, as

clinical trials. We will continue prioritizing emerging

well as with world renowned scientists and institutions

markets, which are the most in need as they have the

that are endorsed by COFEPRIS. PROBIOMED has 16

biggest patient populations and the lowest budgets. We

biosimilars that were registered as generics under the

are focusing on serious chronic-degenerative diseases

previous regulation and that are undergoing renovation

that have the highest social and economic impact. We

process, and we have five more products in the pipeline.

are already operational in 14 countries in four continents, albeit with an incomplete product portfolio, but we will

Q: How advanced is PROBIOMED in grasping the

make sure all of our products are launched there as soon

biosimilar opportunity in Mexico and becoming a global

as we renew their marketing approval in Mexico. The

company?

better we comply with the regulation the faster we can

A: Mexico is facing crucial challenges regarding the

enter other markets, Latin America being our natural and

demographic and epidemiological shift as the population

main entry point.

is aging and chronic degenerative diseases are increasing. As the number of patients with comorbidities increase,

Q: How does fragmentation of Mexico’s healthcare system

the number of taxpayers decrease along with public

prevent patients from benefiting from high specialty

budget and cost containment strategies. Therefore,

drugs?

we visualize several opportunities to provide efficient

A: There are no clear or harmonized processes and

solutions including research that can turn into treatments

policies for budget and resource allocation across public

for Mexican patients, biosimilar development to ensure

institutions. For instance, the budget that Seguro Popular

access to added value products at affordable costs and

receives per state depends on the size of the population

savings at healthcare institutions, and becoming an

covered and not on disease incidence, prevalence or

active player shaping the Mexican biopharmaceutical

healthcare needs. Also the budgets allocated to each state

industry. An example of this in Mexico can be attested

are not subject to supervision.

with erythropoietin, a drug for the treatment of anemia in patients undergoing chemotherapy or dialysis. Before

States have the discretionary decision where to invest,

undergoing patent expiration, the innovative drug was

and often funds are devoted to other administrative

only available to treat 3,500 patients given its high cost;

areas or other activities rather than healthcare or

upon expiration in 2001, biosimilars entered the market

medicines. Again, there is no real accountability, tracking

and dropped the price 90 percent making it accessible for

or resource control. The intent today is to centralize the

80,000 patients at a lower cost. Savings add up MX$7.5

resources of Seguro Popular and manage this process

billion (US$400 million) so far, which equates to 10

to guarantee transparency. Mexico should have just one

regional hospitals with 250 beds each, 10,000 ambulances

healthcare system. This proposal has been discussed for

or 122 clinics with 10 consultation offices each. Those

many years with an abundance of political will but no

savings could be invested in infrastructure or in innovative

real progress.

medicines. Q: What impact do you expect the Trans Pacific The biosimilar industry is facing very rapid development,

Partnership to have on Mexico’s biosimilar industry?

maturation and harmonization. As the certainty to enter

A: We are convinced the agreement will provide the

markets evolves with a harmonized regulatory framework

pharmaceutical industry with great impulse, and this will

the

PROBIOMED’s

certainly benefit patients and healthcare institutions in the

products will follow. PROBIOMED is dedicated to the

country. We recognize Commissioner Mikel Arriola’s work in

development and commercialization of biosimilars that

having positioned COFEPRIS as a leader and a benchmark

can offer value through unquestionable quality and

for regulatory agencies from countries participating in the

access to affordable medicines. To accomplish this, we

TPP. As well as their prominent role in the negotiations

have to be extremely responsible in the way we invest and

of this agreement that will, without a doubt, promote

demonstrate the quality of our products. Regulators still

economic growth and pharmaceutical innovation in Mexico.

need to define the depth and breadth of clinical studies

It will also impact positively in terms of the capacity to treat

that are scientifically or regulatory sound for a biosimilar

a larger number of patients in our country and become

that has a very solid characterization. As the industry

crucial for the health sector in the region.

penetration

of

biosimilars

and

85



4

BRANDED GENERICS & OTC

The mistrust Mexican patients once held for generics has disappeared and generics now represent 82 percent of the pharma market, according to COFEPRIS. Many patents are due to expire in the next four years and companies are preparing to fill the void with generics, biosimilars and branded own products. Generics have also become the medicine of choice for public institutions that need reliable products in bulk but are financially restricted by federal budget cuts and the high price of specialized medicines.

OTCs are still a key part of the medicinal market. Some industry insiders believe effective branding is the key to creating and maintaining brand loyalty. Regulations have tightened in recent years and in early 2016 the new NOM-059-SSA1-2015, which sets the standard for medication sold in the country, came into force. This has not slowed down companies that are innovating and looking to improve standards, often by obtaining the Good Manufacturing Practices (GMP) certification from COFEPRIS. This chapter will review the companies producing OTCs and branded generics, the challenges they face, the opportunities they are seizing and the future they expect.

87



89

| CHAPTER 4: BRANDED GENERICS & OTC 90

VIEW FROM THE TOP: Alfredo Rimoch, Liomont

92

VIEW FROM THE TOP: Adrián Ruíz, Hetlabs Mexico

94

VIEW FROM THE TOP: Eugenio García, Glenmark

95

VIEW FROM THE TOP: Américo García, Apotex Latin America

97

VIEW FROM THE TOP: Carlos Abelleyra, Aspen Labs

98

VIEW FROM THE TOP: Efrén Ocampo, Grupo Neolpharma

99

VIEW FROM THE TOP: Luis Zerecero, Laboratorios Keton

100

VIEW FROM THE TOP: Juan Aguirre, Brudifarma

102

VIEW FROM THE TOP: Alejandro Martín, Mayoly Spindler

103

VIEW FROM THE TOP: Iván Wong, Novag

104

VIEW FROM THE TOP: Roberto León, Farmacias GI

105

VIEW FROM THE TOP: Salvador Berríos, Qually

Graciela Aguilar, Qually


| VIEW FROM THE TOP

MEXICO AS A SPRINGBOARD FOR EXPANSION ALFREDO RIMOCH Director General of Liomont

90

Q: What are the main drivers of the double-digit growth

Q: How are you competing against pharmacy chains that

Liomont has been experiencing in recent years?

are growing by pushing their own generic brands?

A: According to IMS Health, the pharmaceutical private

A: Our main strategy to build the brand is to visit physicians.

market has been growing between 6 to 7 percent

Liomont’s sales force consists of 1,000 representatives

annually. Liomont has grown 10 percent in this market

distributed throughout the country who visit an average of

and 13.5 percent overall. This is a result of a strong

40,000 physicians. Pharmacy owned brands are our main

marketing strategy based on effective demand creation

competitors today and doctors adjacent to pharmacies

and the development of an effective network of sales

represent a potential conflict of interest when it comes to

representatives

which

substituting prescriptions. Therefore, we have to create

has earned the trust of the whole value chain. We have

more demand of our brands and products to remain

a consistent strategy targeting distribution channels and

competitive and counteract the number of prescriptions

pharmacy chains and we disclose information to them so

being

they are aware of our products. Also, we make sure our

manufacturing agreements with local producers and

products are always available at the sales point and we are

while we are always open to this arrangement, we are not

committed to launching eight to 12 new products a year,

engaged in this kind of negotiations because this is not

which surely puts us at the forefront.

our main focus at the moment.

Q: For what reasons has Liomont decided to focus its

To participate in other activities such as R&D we must

business strategy on the private market despite public

ensure a certain level of profit margin that could be

institutions being the largest buyers of medicines?

reinvested. We are creating alliances with academic

A: Forty percent of the units we manufacture go to the

institutions such as the UNAM Biotechnology Institute,

public market, but that only represents 7 percent of our

CINVESTAV and others to advance R&D. Yet if we were to

sales. This is due to public institutions’ limited budget

focus entirely on the generics market our R&D would not

to purchase medicines and the constant search for

be possible.

constantly

visiting

physicians,

substituted.

Pharmacy

chains

have

contract

lower prices. The public healthcare system spends 40 percent on acquiring 2 percent of the products, which

Q: While Liomont is a leader in OTC products and branded

are innovative drugs for highly specialized treatments.

generics, you are strongly focusing on biotechnology.

The rest is used to purchase 98 percent of mostly generic

What do you want to achieve with your biotech portfolio?

products. We are aware of the importance of a Mexican

A: Our main business line is branded generics, which

company creating and improving access to medicines but

create equity for the company and this is where we

with a devaluating peso and the public sector pushing

base our success. OTC products account for 20 percent

for lower prices it is more difficult to participate in that

of our business despite the many complications taking

market. Liomont has traditionally focused on the private

place in recent years. It is true we are focusing on

market and I truly believe this has given us the strength

biotechnology and we are aiming to grow in this area.

we have today. According to the OECD, public institutions

In 2015, we obtained market authorization for the first

should significantly improve their processes as there are

biotechnology-based vaccine for influenza called Flubok,

still several issues, such as the tender system being based

marking an important milestone for Liomont. We also

on an all-win and all-lose model. This creates a situation

have a number of biosimilar products in the pipeline,

in which price is the only factor to be considered in a

some of them in association with a US company called

negotiation. There are some other things that add value to

Oncobiologics. These are also long-term projects as

processes, such as the ability to track products along the

biosimilar development itself takes three to four years and

supply chain and providing integral solutions.

we have to time it with patent expiration. We are aiming


“Other local biotech

Q: What do your expansion plans include?

companies are aiming

international. We are already present in Europe with some

to export biosimilars to

the US and we are in the process of launching generics

international markets, and I

A: We are focused on growing and becoming stronger and generics. Some of our OTC products are also present in into this market. We are consolidating our infrastructure capabilities with our new plant for biotechnology

think it is a very good sign

medicines,

that local players think about

our brand as to be associated with quality, ethics and

going international�

partnerships to enter the US generics’ market but our

Alfredo Rimoch, CEO of Liomont

vaccines

and

other

highly

specialized

medicines. Also, we are working to create awareness of trust, which are the pillars of the industry. We are creating biggest challenge is to improve perception of Mexican products. We are building a new facility in the State of Mexico that is going to be a highly specialized site for

to be in the market with two biosimilars, one programmed

the production of biotechnology drugs and injectable

for late 2017 and the other in 2018.

products. The first stage of our plant will open in 2017 and is part of a bigger project. We are aiming to produce

We are also developing products in collaboration with

highly specialized treatments for cancer, rheumatoid

UNAM Biotechnology Institute, which is a really good

arthritis and other chronic non-communicable diseases.

initiative and we expect to launch the product in 2017.

In line with this, I think the government should play a

The company wants to become a global player, so we

much more active role in supporting local companies

are creating partnerships with international companies

and Mexico should be independent in terms of providing

to reach international markets. This would only lead us to

healthcare to the population through local manufacturing

meet the highest quality standards and to be authorized

and infrastructure. This is something we have not

in any country of the world. Local markets are sometimes

seen lately but I think there is much more interest and

small and highly dependent on the government. We are

awareness today with key figures realizing the strategic

going to manufacture biosimilars locally and then export

importance of the pharmaceutical industry. Prioritizing

them to Latin America, Europe and probably the US. Other

healthcare as a driver of economic development is also

local biotech companies are aiming to export biosimilars to

one of the main challenges and educational healthcare is

international markets and I think it is a very good sign that

crucial to the system.

local players think about going international. Regarding the flu vaccine, we are already entering Argentina and Chile in the next 12 months. Q: What are the advantages of the biotechnology based influenza vaccine? A: There are several producers of vaccines for influenza. The existing vaccines are based on a 60-year-old technology that mainly uses eggs inoculated by the virus. Producers work with a deactivated virus but it is still a virus. Biotechnology techniques enable us to stop using the virus and work with its DNA instead. This creates an immune response from the organism and the vaccine is a lot cleaner because it does not use either the actual virus, chicken embryos, preservatives or allergens. We expect new strains of influenza virus to appear in the future as viruses constantly mutate. In the case of a pandemic, it would take egg-based vaccines six to eight months to be ready, whereas the recombinant DNA vaccine would be ready in around two months. Every year the WHO identifies the most prevalent strains and identifies three or four of them to produce trivalent or quadrivalent vaccines. Our vaccine is trivalent and next year we will have the quadrivalent.

91


| VIEW FROM THE TOP

INDIAN GIANT BETS ON LOCAL BIOSIMILAR MANUFACTURING ADRIÁN RUÍZ Director General of Hetlabs Mexico

92

Q: What recent commercial achievements would you like

to do so with a good quality of life. Thus, multinational

to share as the most relevant Indian company according

companies are aiding patients with their chronic illnesses.

to IMS Health?

Regulations

A: In 4Q14, we achieved 65 market authorizations on

bioequivalence studies for generics is not enough. Active

finished dosages for several customers. As an active

pharmacovigilance is an essential requirement for generic

pharmaceutical ingredients (API) supplier we interact

producers to demonstrate their product’s safety. Mexico

with our customer’s development departments and now

is starting to reap the benefits of all these efforts and I

have 35 new market authorizations. Hetlabs has 91 market

would say we have more opportunities than challenges.

authorizations for molecules and 81 licenses.

Balancing quality and price is perhaps the most important

have

become

stricter

and

conducting

challenge for companies today. As the most successful We also submitted new fixed combinations to the Mexican

Indian company we are committed to complying with

Institute of Intellectual Property (IMPI) gazette and four of

all regulatory requirements and therefore we will only

our patents for innovative molecules have been published,

compete against those companies with the same level of

so we are submitting two more. We plan to launch these

quality and compliance.

products in 2016 and expect revenues of at least US$10 million per molecule. We have one fixed combination

Q: How have you developed your manufacturing site?

product for erectile dysfunction and expect to position it

A: We acquired one of the best facilities and rebuilt

in the top five. We also want to be ranked in the top five

it to be a high-specialty manufacturing site aimed at

biggest companies for cardiovascular and central nervous

producing biosimilars and cancer drugs. We found

system products in Mexico. In the specialty care business

the right partner in Mexico and we hold 90 percent

segment, we have submitted three more patents for

of the company. We have established communication

antiretroviral (ARV) drugs, where we are the world leaders

with the Subcommittee of Biotechnology Products

with a 30 percent market share. We expect to launch

at COFEPRIS and we presented the layouts for our

related products by 1Q16 in a joint venture with Vanquish

biosimilar manufacturing site. In addition, we had a pre-

Pharmaceuticals. We expect to achieve at least 15 percent

meeting for the authorization of our first biosimilar and

of the ARV market share in the first year and 30 percent

we are working closely with CONACYT and the State of

in the second year.

Mexico’s Council for Science at Technology (COMECYT). We are committed to talent development in this facility.

Q: What are the most relevant trends shaping the generics

At launch we will have Indian people working on the

environment in Mexico?

technology transfer process and Mexican workers will

A: Mexico has become one of the most interesting

join subsequently. Initially, this site will supply biosimilars

markets worldwide. The black market used to represent

to Latin America. Secondly, with the site meeting EMA

30 percent of Mexico’s pharmaceutical market. It had a

requirements, we will export products to the US and

strong presence in remote areas that were not covered by

Europe. As Mexico gains greater recognition among

any formal distributor. But now pharmaceutical companies

those countries exports will be easier from Mexico than

and distributors are reaching those areas and along with

from India. We are conducting preclinical studies in

a stronger COFEPRIS, they have weakened the black

mice and monkeys in the US and clinical trials phase I, II,

market. Moreover, the population is undergoing a cultural

and III for biosimilars in Mexico. The characterization of

transformation in which patients are more informed and

biosimilars includes non-inferiority studies, knowledge

demand better services, while physicians evaluate the

of drug behavior in patients and risk management.

health benefits and risks of medications more carefully.

In the short term we will begin phase I of a product in

People not only want to turn 80 years old but they want

collaboration with UNAM.


Q: Why did you decide to invest in manufacturing in Mexico unlike other multinational companies divesting in this area? A: Hetero Groups is confident that Mexico is a great place to do business and I think multinational companies are making a huge mistake. The country has a high level of technical expertise and educated professionals. Pharmaceutical manufacturing costs are as low as in India

“We are striving to make generics and biosimilars for top specialty care areas our focus” Adrián Ruíz, Director General of Hetlabs Mexico

and Mexican workers are among the best in the world in terms of performance. I have seen top-level manufacturing sites being built in two years in Mexico, which is something

Q: What steps will you take in order to ensure a leadership

that does not occur in the US, Europe or Russia. India can

position in the biopharmaceutical market?

have this kind of development but not at the same level

A: We will start commercializing biosimilars next year and

of technical performance. Economically speaking, Mexico

we will prepare for the next tender. This means we need to

has an inflation rate of 2.8 percent compared to other

obtain market authorizations soon, which is an ambitious

Latin American countries.

but achievable goal. Failure to accomplish this would mean products have to be imported from India. As this

Q: How easy will it be for Hetlabs to tap into the

country does not belong to any relevant trade agreement

biotechnology market in Mexico?

in the region we would be the last option. We will be ready

A: Mexican regulation is at the level of the EMA. However,

for manufacturing in April or May 2016. The first batches

Europe has several years of experience in this area while

will be ready for short and medium term stability tests,

Mexico is just going through the learning curve. There are

which will pave the way for market authorizations. We are

strong committees in the pharmaceutical and regulatory

conducting clinical trials aimed at collecting data over a

chambers pushing biotechnology forward. COFEPRIS wants

six-month period.

more availability of biopharmaceuticals in the market so that more people have access to treatments, but to achieve

The data will allow us to be ready for the market

this all stakeholders need to understand the business and

authorization submission. As the authorities have overseen

regulatory environment of the products. Phase III and

the manufacturing and clinical development processes we

IV clinical trials have been conducted in Mexico for many

expect to be the first to market oncology biosimilar drugs.

years and companies are interested in conducting phases

We are also launching two generic oncologic drugs. We

I and II. Biopharmaceuticals are much more complex than

have a complete portfolio of molecules belonging to the

chemical drugs, not only in terms of manufacturing but also

tyrosine-kinase inhibitors (-tinib) category, such as imatinib

transportation since they need special care to remain stable.

and gefiniti, that are part of the latest generation of drugs.

It takes three months to release the product for quality

As their development and manufacturing is really complex

assurance when it arrives in Mexico. In this case, we are not

there are only two or three producers. Bioequivalence

providing a bioequivalence study but non-inferiority studies,

studies for these products are very complex and

which is the reason why they are called biosimilars because

expensive. The average cost of a bioequivalence study for

they are not identical to the innovator.

the chemotherapy drug capecitabine is US$19,000 while for -tinib molecules it costs US$450,000. We are striving

The first line of products we are introducing to Mexico

to make generics and biosimilars for top specialty care

under this venture are the monoclonal antibodies,

areas our focus.

and we are ensuring compliance with all of COFEPRIS requirements, which is why we have delayed product

Q: In what way is TPP going to transform the biotechnology

launch. The question is whether these products will be

landscape in Mexico?

able to participate in the same tenders as innovators and

A: TPP can bring many opportunities to the industry,

how IMSS and ISSSTE are going to manage them. Now

and the biggest challenge is finding them. Since India

that rules are clear and transparent many companies

is not included in NAFTA, European Trade Agreement,

are competing to be first in the market. Despite the

Latin American Trade Agreement, or TPP it will be

government urgently needing low cost biosimilars it does

challenging for Indian companies to remain competitive

not want to infringe patent issues or affect the revenues of

in terms of costs due to taxation. This supports our

multinational companies that have invested over the years.

strategy of building and opening a manufacturing site in

The market is completely aware of patent protection today

Mexico because having a direct presence in the country

and nobody wants to have a problem with intellectual

makes Hetlabs a Mexican company, and thus TPP will

property in Mexico.

benefit us.

93


| VIEW FROM THE TOP

RETAIL AND PRIVATE GENERICS MARKETS SHOW GROWTH EUGENIO GARCĂ?A Director General of Glenmark

94

Q: What do you think is essential for multinational

that have commercial agreements with Mexico. In the

branded generic companies like Glenmark to grow in the

meantime, authorities may save on consolidated tenders

Mexican market?

if they are open to international competitors. The retail

A: The Mexican pharmaceutical industry has interesting

market presents the most relevant opportunity as it

retail and public growth opportunities. In the retail market

represents 72 percent of the market value and we presume

multinational branded generic companies need to keep

this trend will remain for the next decade.

investing in broader portfolios to satisfy physician and patient needs. There are still limitations to the institutional market

Q: Aside from limitations in the public sector, and in your

such as the national integration requirement to participate

sales volume, what explains your growth in the private

in tenders. Multinational branded generic companies have

sector?

many things to offer to public institutions and if they open

A: There are no limitations in this market and providing a

to international tender, competition would be much fairer

complete portfolio with high-quality products at competitive

and public institutions would save larger amounts. For this

costs is our greatest strength. This is not a matter of price

to happen, Mexico needs to have commercial agreements

but a matter of providing people with affordable products

with more countries such as Brazil, Argentina, India and

so they can buy other medicines as part of their treatments.

China. The Trans Pacific Partnership (TPP) will bring

Our growth is going to be sustainable for a long time in

positive changes, new opportunities for companies, and the

this sector because we are a research-driven global and

possibility to sign further agreements. The government’s

integrated pharmaceutical company. Glenmark is a leading

commitment to expand its commercial agreements across

player in the discovery of new molecules, both NCEs and

the world will certainly benefit patients and the continuum of

NBEs with seven molecules in various stages of clinical

care in Mexico. I am certain branded generics manufacturers

development and pre-clinical development. The company

will have more opportunities, which is actually driving other

has a significant presence in branded generic markets

companies to enter the generics market.

across emerging economies. Glenmark Pharmaceuticals LTD also markets APIs to regulated and semi-regulated

Q: What is your strategy to meet the national integration

countries. Glenmark has offices in over 20 countries, 16

requirement to participate in public tenders?

manufacturing facilities in five countries and six R&D

A: Meeting the national integration requirement is not

centers dedicated to enriching lives across the globe. This

easy as the law requires companies to undergo significant

enables us to participate in key therapy segments such as

transformation. An alternative to achieving the minimum

dermatology, respiratory, oncology and cardio-metabolics.

65 percent of national integration is through local third party manufactures and sourcing products from countries

The sustained growth in the retail and private markets will continue with consistent innovation, customer need

Generic medication represents over 80 percent

of the market in Mexico. Pharma sales are expected to grow an average of 5.6 percent annually until 2018

satisfaction, field force effectiveness, ensuring effective supply to the point of sale and strong compliance. Q: You mentioned that some of your plans to grow in Mexico might include licensing, what opportunities and partners are you looking for? A: We are looking for opportunities in the therapeutic areas we operate in and in co-promotion, co-marketing and out licensing. We seek products that would complement our existing portfolio.


| VIEW FROM THE TOP

GENERICS GIANT TAPS INTO THE BIOSIMILARS’ MARKET AMÉRICO GARCÍA Director General of Apotex Latin America

Q: How did Apotex increase its presence in Mexico and

local industry. According to IMS Health, the Mexican

Latin America in 2015?

biotechnology market is growing faster than other

A: Apotex went through a renovation period in 2015 during

segments in the pharmaceutical industry and this trend

which we reviewed the company’s main processes from

will continue thanks to 12 biopharmaceutical complex

reducing centralization to promoting a radical change in

molecules losing their patents in the upcoming years.

the human resources area to adapt to new industry trends. We are now reaping the rewards of the transformation,

Biosimilars cannot be treated in the same way as small

including obtaining the Good Manufacturing Practices

chemically synthesized generics since traditional safety

(GMP) certification by COFEPRIS, reversing the downward

standards, efficacy and quality are not suitable for proving

trend in our market share and increasing customer

that a particular biological medicine is a generic version of

satisfaction while achieving stronger brand presence

another. In Mexico the Ministry of Health and COFEPRIS

among our clients. Our progress is partly explained by the

published an amendment to the General Health Law in

double-digit growth exhibited by private label medicines

October 2011, aimed at establishing new provisions for

in pharmacy chains, which are looking for manufacturers

the approval of biopharmaceuticals and biocomparables

with GMP certification.

including approval requirements, prescription rules, the role of COFEPRIS in determining the scope of pre-clinical

Q: Apotex is a company with a strong product portfolio.

tests and trials and labelling requirements, all of which were

What new innovative medicines do you have in your

aligned to European Medicines Agency (EMA) regulations.

pipeline?

We believe there are clear rules and regulations for these

A: We cover solid dosage and injectables to aerosols and

products in Mexico now and we are planning to start the

biopharmaceuticals. Apotex has more than 600 products

application process for biocomparables soon.

under development across all technology platforms. In Mexico, we have a strong pipeline focused on the central

Q: Do you anticipate the Trans Pacific Partnership (TPP)

nervous system, cardiometabolic diseases and specialty

having a discernable impact on the local biosimilar

products. The mission of Apotex in the country is to

industry?

strengthen its growth through the commercialization of

A: A paragraph addressing unreasonable shortenings and

new, world class quality molecules.

delays was incorporated in TPP provisions and although the obligation is in the text, Mexico might not be in the

Q: How will your experience in the US market help you to

position to grant the extension of the patent term. The

tap into Mexico’s biosimilar industry?

country has already granted five years of data protection

A: Apotex is a rising competitor in the global biosimilar

for new chemical entities, including combination products,

market. In February 2015, the FDA approved Apotex’s

and it was possible to exempt Mexico from granting data

Filgrastim. This is the second biologic product Apotex

protection for new uses as it provides data protection

has submitted to the FDA via the abbreviated approval

for combinations. Eight years were granted for products

pathway created by the Biosimilar Price Competition

consisting of or containing proteins obtained through

and Innovation Act (BPCIA). Apotex also has a biosimilar

biotechnology processes, or five years’ data protection for

application for the long-acting pegylated formulation of

biologics with the potential to extend market exclusivity.

filgrastim under FDA review. Filgrastim is used for helping

Ensuring intellectual property protection for medicines has

cancer patients under chemotherapy fight infections and

expanded the population’s access to innovative medicines

fever by boosting white blood cell counts. The fact that

in Mexico, which has resulted in increased life expectancy

biosimilars are set to boom in the US market in the next

and quality, reduced hospitalization and boosted savings

couple of years will help Mexico develop a substantial

for Mexican households.

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| VIEW FROM THE TOP

FIGHTING MEDICAL BIAS WITH EFFECTIVE GENERICS CARLOS ABELLEYRA LATAM Director of Aspen Labs

Q: What are the most relevant market needs in Mexico

first two years it needs a product and when the competitors’

and Latin America that will drive Aspen Labs’ growth in

volume increases we retire from that segment and try to sell

the region?

another product they are starting to demand. No one can

A: In the past, Big Pharma companies had capacity to

supply the full volume required by consolidated purchases

generate patents that became the blockbusters we all are

leading manufacturers to sell products through distributors

familiar with. The need to explore new markets is changing

at the same price.

industry rules and Mexico is no exception since more than 70 percent of products are generics. Yet the level

Q: How do you manage to position your OTC brands,

of enforcement or use of generics in the private sector is

especially when there are several OTC products that do

not elevated. This is due to the lack of legal enforcement

not necessarily have the therapeutic benefits they claim?

in following prescriptions as pharmacy chains use doctor

A: Branding is fundamental to the success of OTC products.

consultancies to prescribe their own products. Doctors

In the branded generics business we are constantly

at hospitals are losing the power to define the correct

looking to acquire well-known OTC brands. In Mexico

treatment for patients and this has to change. At Aspen Labs

we are developing a product line for gastrointestinal

we are working in specific therapeutic areas and focusing on

diseases, targeting a launch in the second half of 2017. In

products that can be sold without a prescription. Pediatric

other countries we have a stronger position in the OTC

products are a good example of this as mothers prefer to

market but we are developing it here. OTCs have many

have a prescription and not only recommendations from

opportunities especially given the economic situation

clerks. This requires us to create product awareness among

of the country where the cost of a medical consultation

physicians instead of fighting against pharmacy chains,

plus the medicine can be expensive. OTC drugs for acute

and doctors at the sales point. Focusing on these kinds

diseases will become an important part of the equation

of products has turned out to be an effective strategy to

and we see promising growth in this area.

ensure return of investment in promotion. Q: What are the main hurdles of the infant formula Q: Your strategy is pretty much focused on acquiring

industry and how do you deal with its detractors?

existing products from other companies. How do you

A: The industry has to work together not to push for the

manage to change their life cycle and capitalize on the

use of infant formula but to avoid political positions that

opportunity they still have in the market?

are detrimental. Some people believe that women should

A: We tend to believe companies divest product lines

only give babies breast milk. Instead of saying infant

because they are not interested in them anymore. However,

formulas are detrimental they should recognize there are

this has more to do with strategic areas companies are

still many regions where the nutrition level of mothers is

focusing on including research and innovation. Although

so bad they are not able to provide quality milk for their

products are still doing well in the market, sometimes there

babies. Additionally, employed mothers often find it very

is no budget to promote them. Our business is still interested

difficult to breastfeed their children. A huge percentage of

in buying products and companies but we are more focused

babies are delivered by C-section and if the baby does not

on specific areas where prescription is necessary or OTCs

receive breastmilk in the first three days it is more difficult

for therapeutic areas on which few companies are focusing.

for mothers to keep producing milk on a constant basis. In

Last but not least, and this is relatively new for us, is the

Aspen Labs we support breastmilk and we give mothers

hospital business. Cancer and thrombosis are very important

an additional month after they have a baby. However, we

for generics today but they need to be produced by a

are against those who claim breastmilk has to be given by

formal company. Oncology generics are not an easy thing

law when it should only be a health recommendation. We

to handle. We sell generics to the government only for the

are innovating to be as close as we can to breastmilk.

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| VIEW FROM THE TOP

NEOLPHARMA GROWTH POISED ON CARDIO-METABOLICS EFRÉN OCAMPO Director General of Grupo Neolpharma

98

Q:

How

has

Neolpharma

and

the

companies

it

improving worldwide. The country is now a reference

encompasses grown and expanded in the last year and

point for the Pan-American Health Organization (PAHO).

what are the main strategies and drivers of growth?

Grupo Neolpharma will adapt its medicine manufacturing

A: Grupo Neolpharma’s growth rate slightly surpasses

practices to the new NOM-059-SSA1-2015. In fact, the

the market average. We strategize in a way that our role

company has adapted its operations to the new NOM

in every drug segment is secured especially in regards to

beforehand, gaining ground on its competitors.

prescription drugs. We continue to expand our product lines. Grupo Neolpharma’s newly created cardio-metabolic

Q: With Grupo Neolpharma’s new cluster investment of

health branch will have a great impact on our operations,

MX$750 million (US$19 million), what products are you

which will be released in the following months. After

aiming to manufacture and what type of growth will the

this, we expect double digit growth. Finally, the group

company see?

will continue to industrialize its procedures and internal

A: This investment falls in line with our internationalization

structures.

plans, as it will cover most of our export demand. Neolpharma’s new laboratory is added to four existing

Q: What other new areas of specialization is the company

manufacturing plants in the country increasing the

expanding to?

company’s production capacity by 150 million units per

A: Grupo Neolpharma will release a neuropsychiatric

year. Our business projections for 2020 foresee double

product in 2016. The company is looking into different

the growth of 2015. Grupo Neolpharma will incorporate

alternatives to drop costs in biotechnological product

a broad range of products in a multiplicity of markets. To

releases as clinical trial costs remain one of our biggest

this day, our Central and South American operations have

deterrents. This is a national problem that must be carefully

a total of 16 distribution points further pushing our growth

analyzed if we expect a healthy Mexican biogeneric market

to new grounds. Our new cluster positions us as the largest

segment. Producing this type of drug is not difficult

drug manufacturer in Mexico’s key segments.

but creating molecule bio-comparability is. Investing in characterization studies could reduce the number of

Q: What collaborations have you established?

subjects needed for successful clinical studies as recently

A: We collaborate with multiple universities like UNAM to

promoted by the World Health Organization (WHO).

develop the right talent in areas where it is needed the most.

Q: How much competition do you face against pharmacy

Grupo Neolpharma is working with the Center of

owned branded generics at the point of sale?

Investigation and Advanced Studies (CINVESTAV) in

A: Competition will evolve in the near future and the market

granting awards in the nanotechnology field. This is a

will see premium products. The company’s production

focal point for the group’s future development as it will

plants have been built with state-of-the-art technology.

release a new nanotechnology product line in years

We do not want to engage in competition with pharmacy

to come directly supporting the growth expected by

owned brands as their prices do not reflect their costs.

2020. We are also working with CINVESTAV on new

Survival prices are not uncommon in this market segment,

product developments with neurological and oncological

which does not fit Grupo Neolpharma’s business strategy.

applications.

We are a company with highly competitive product offerings maintaining top quality at all times.

Finally, Grupo Neolpharma commercializes an orphan drug patent with oncological applications in the US market

Due to Mikel Arriola’s newly implemented COFEPRIS,

developed alongside National Instute of Cancerology

the perception of Mexico’s pharmaceutical industry is

(INCan).


| VIEW FROM THE TOP

PARTNERING WITH INTERNATIONAL COMPANIES LUIS ZERECERO Director General of Laboratorios Keton

Q: Can you give our readers a brief history of the

making us partners of choice in the country. For the time

company’s background?

being, we are waiting for COFEPRIS recertification as

A: Laboratorios Keton is a family-owned Mexican

our plant undergoes structural changes. Our equipment

company that recently celebrated its 60th anniversary.

will be refurbished, which will triple our production

We manufacture beta-lactam and oral cephalosporin

capabilities, set at 600,000 tablets per day. In return,

antibiotics for major pharmaceutical companies running

we will provide our clients with better services and

operations in Mexico. We represent foreign companies

response times while also improving the quality of our

from Indian, Austrian, Italian, Colombian and Spanish

products.

origins looking to leave their mark on the country. To date, 80 percent of Laboratorios Keton’s profits derive

Q: What are the biggest business opportunities for

from its subcontracting activities while the remaining

Laboratorios Keton’s manufacturing activities?

20 percent results from representing international

A: We have set the goal of expanding our production

enterprises.

capabilities by 2020 or 2022. After a US$5 million investment we will establish a new pharmaceutical

Q: What does representing foreign companies entail?

manufacturing plant. But COFEPRIS requirements in this

A: Three years ago, a person could not import medicines

regard are extremely strict, which we have to factor in

to the country, forcing them to use the services of

advance.

established pharmaceutical laboratories in Mexico. This is no longer true as companies can import drugs without

Q: How has the pharmaceutical industry evolved

previously registering in the country. This new market

through the years?

opening has resulted in large volumes of foreign medicines

A: I have been part of the Mexican pharmaceutical

coming into the country, but companies continue to

industry for over 56 years and the changes it has

use our services, limiting their involvement in tariff

undergone are dramatic. The evolution has been

and customs operations. Laboratorios Keton registers

systemic always improving protocols and strengthening

products under its brand once internal evaluations and

regulations. But the biggest shift began four years ago as

certifications are held, further referencing them to its

major and significant changes recently came into force.

clients’ Mexican subsidiary for future commercialization

Homogenizing a plant’s capabilities to international

under their independent branding.

standards is one of the biggest problems companies face when applying for COFEPRIS certifications but it

Q: How have Laboratorios Keton sales grown over the

keeps the quality of Mexican products up to par.

past few years and what is the company’s market share? A: In 2015, the company’s sales amounted to US$5

Q: How is the rise in biosimilars and generics affecting

million. This year, our profit base is set at MX$50-60

Laboratorios Keton?

million (US$3.4 million to US$4 million). Laboratorios

A: Even though it is helping our operations generics, will

Keton is substantially smaller than the companies it

occupy 80 percent of the Mexican antibiotics market in

services, which can be seen in its profitability margins.

the near future. As a result, major Big Pharma entities are acquiring generic manufacturing plants in Mexico.

Under these circumstances, covering the costs of setting

Laboratorios Keton has approximately 20 patented

up a manufacturing plant in Mexico is not a constraint but

products, a considerable task in a market where most

receiving authorization from headquarters can take up

molecules

to five years. Keton has a well-established, state-of-the-

registered. This is especially true as we lack innovative

art facility that falls in line with all regulatory practices,

technology that leads to new product types.

and

applications

have

been

previously

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| VIEW FROM THE TOP

DEMAND SPIKES FOR GENERICS

JUAN AGUIRRE Commercial Manager of Brudifarma

100

Q: What has been the biggest change within the generics

Q: How do you compete against foreign products entering

market in Mexico?

the market?

A: The biggest change has been customers’ perception. If

A: I have noticed a strange behavior in the market resulting

you go back five years, the Mexican market did not accept

from their entry. What happened to generics 10 years ago is

generic medicines believing they were less effective than

now happening to foreign products. People are comfortable

patented ones. The government has made a huge effort to

with brands or Mexican generics but do not trust foreign

get the public on board by providing them with information

generics be they Canadian or Israeli. Their origin makes no

about the testing generics undergo, and this has helped

difference. Although many companies have come to the

significantly. Nowadays, 90 percent of people trust

market they have not experienced the expected results and

generics and buy them. There is still some suspicion around

have only gained market at a slow rate.

generics for chronic disorders or very specialized ones but cold medicine and anti-inflammatories are widely accepted.

Q: What impact did COFEPRIS’ latest modification have and what repercussions would stricter regulations have

Q: What type of generics is most demanded right now

on the market?

and what trends have you spotted in the Mexican market?

A: The impact on quality has been minimal because companies

A: There has been a shift from penicillin-based antibiotics

had been slowly migrating to the new requirements over

to third generation ones. Trixona is our second top seller,

the past five years, already ensuring top quality. The biggest

which is both good and bad. Common belief is that a

hassle is the requirement to renew registrations every two

good doctor heals as fast as possible but this is not always

years for Good Manufacturing Practices (GMP) and every

the best way to go. One of Mexico’s problems is that

five years for products. Pharmaceutical companies are now

people do not finish their treatments because they start

constantly renewing their registration, leaving little time for

feeling better and these half-complete treatments have

innovation. Although these new requirements have been

been strengthening viruses. Doctors tend to go for the

good for the industry, since more regulations were needed,

strongest antibiotics available, which should only be used

it is slowing the innovation process. At the moment our

in cases of extreme infection, contributing to this decrease

standards and quality are very high. We had the opportunity

in public health. Although this is a profitable approach for

to visit laboratories in Mexico and we know many that are

companies such as Brudifarma and patients feel better

up to international standards but it has now become more

very quickly, it also means stronger viruses. Humanity

cumbersome for them to get new registrations. Due to

would benefit if longer-lasting but more appropriate

this, the market is experiencing an increase in price. Three

antibiotics were prescribed. The shift to cephalosporin-

or four years ago the Mexican market underwent a price

based antibiotics has been the biggest change in the

war as ibuprofen, diclofenac and similar medicines turned

Mexican market.

into commodities. Manufacturers were fighting, and the only weapon they had was price. Unfortunately for the

Q: How is the government contributing to taming the

customer, the consequence is that prices stabilized and

problem?

have even increased. This is because distributors have also

A: The government has been pushing several initiatives. Every

had to adapt to the new situation, increasing our capacity to

single medicine box will say that it requires a prescription

ensure products are in the best condition from the time they

to avoid OTC selling. Pharmacies are required to have an

are made to the time they are in the pharmacy and this has

inventory log of all of their antibiotics, including who they

rendered the entire process much more expensive. On the

were sold to and which doctor prescribed them. There is a

bright side, we can now ensure the product that comes out

lot more control and although we are a long way from where

from our plants is top notch and in the best state possible all

we should be we are moving in the right direction.

the way through their delivery to the pharmacies.


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MAYOLY SPINDLER OUT TO CONQUER GASTROENTEROLOGY ALEJANDRO MARTÍN Director General of Mexico and LATAM DIrector for Mayoly Spindler

102

Q: Can you give us a brief overview of Mayoly Spindler’s

is developed with two of the most thoroughly studied

history in Mexico?

strains Lactobacillus acidophilus and Bifidobacterium

A: The company has been present in the Mexican market

lactis, which recolonize intestinal microbiota. Regular use

for over 10 years, commercializing solutions to frequent

of Progiolog® is beneficial for users.

gastroenterology ailments such as irritable bowel syndrome (IBS), gastroesophageal reflux disease (GERD), functional

Q: What partnerships has the company created to

constipation and diarrhea. Meteospasmyl® is one of the

broaden its market presence?

company’s blockbusters prescribed for IBS treatment.

A: Mayoly Spindler can be found in multiple decentralized

It is a soft gel presentation of alverine and simethicone

public

compounds. Mayoly Spindler’s manufacturing plant is the

Guadalajara’s

best equipped for soft gel creation, further positioning it as

for Social Security and Services for State Workers

segment leader. IPRIKENE®, on the other hand, is a natural

(ISSSTESON). In addition, we partially participate with

clay called diosmectite that is effective as a treatment for

the Ministry of National Defense (SEDENA) and PEMEX.

diarrhea, considering it combats toxins, viruses and bacteria.

We are convinced that our alternative treatments have

organs,

such

Civil

as

Chihuahua’s

Hospitals

and

Civil

Sonora’s

Pensions, Institute

an enormous social impact and will soon grow our Q: Considering diarrheic conditions account for one of

relationships with centralized public organs.

the government’s biggest healthcare expenditures, what measures has the company taken in this regard?

Q: What growth has the company seen over the last

A: Diarrhea is the second cause of infant mortality in

couple of years?

Mexico. Therefore, supplying governmental institutions

A: Mayoly Spindler has seen sustained growth in its 10-

that lack complementary adjuvants for oral rehydration

year presence in Mexico. We even achieved double digit

with our products is of the utmost importance. Mayoly

growth during the tough years of 2014 and 2015. Due to

Spindler’s diosmectite clay is the only antidiarrheal

the extraordinary acceptance our products have had, we

authorized for consumption in 1 month-old infants.

slightly surpassed the 20 percent mark. In 2015 the health industry grew by 6 to 11 percent while Mayoly Spindler

IBS is a hypersensitive chronic condition correlated to

achieved 30 percent growth. On average the company’s

abdominal pain, and distension or inflammation, which

market share is 17.2 percent. We hold the 23rd position

has a direct impact on a patient’s bowel evacuation habits.

in a growing Rx segment that evaluates a total of 156

The most common manifestations of IBS are diarrhea,

laboratories. We expect to improve our position by at least

constipation or a combination of both. Even though the

three slots by the end of 2016.

ailment has no present cure it can be controlled with the right medication. The use of Meteospasmyl®, coupled

Q: What type of product portfolio expansions is the

with probiotics can help minimize symptoms. Probiotics

company foreseeing in the mid-term?

are booming in Mexico. Mayoly Spindler’s Progiolog®

A: We foresee 19 product releases over the next five years averaging three per year. Our goal is to become leaders in

“Our goal is to become leaders in the gastroenterology

the gastroenterology segment and our focus and efforts will remain confined to those markets. Mexico has become a reference for Mayoly Spindler worldwide as operations

segment”

have maintained an optimal performance since their

Alejandro Martín, LATAM Area Director and CEO

oversees all Latin American operations and it saw 40 percent

of Mexico for Mayoly Spindler

establishment. Mayoly Spindler’s Mexican division now growth at the close of 2015, the biggest of the company.


| VIEW FROM THE TOP

PRODUCT DEVELOPMENT LEADS TO SUCCESS IVÁN WONG Business Development Manager of Novag

Q: How much potential does the generic segment have in

as its excess space can easily cover the generic demand

Mexico and what role does Novag play in it?

created by the government.

A: The generic segment has grown on a yearly basis as generic drugs have become vital for Mexican consumers

Q: How does Novag differentiate its generic products

and their wellbeing. Even though Big Pharma has been

from its branded generics?

impacted,

chronic

A: Novag’s strength is in its product expansions resulting

diseases has been greatly improved due to our operations.

society’s

health

in

degenerative

in nine yearly product launches. Therefore, growing and

Evidently, costs and availability play a big role in their

strengthening both portfolios is Novag’s best course of

success, which is unfolding on a global scale.

action. We cover the demand of public institutions and individuals. Novag is one of the largest branded generic

Novag’s background as a Mexican company has strongly

manufacturers, which makes for a large part of its business.

positioned it in the generics market segment. We have

Product development is fundamental for Novag’s success

close to 100 products, most of which are manufactured in

and profitability.

our Tlalpan facility. Novag has consistently reached double digit growth over the past 10 years varying between 56

Q: How have pharmacy-own brands affected Novag’s

and 63 percent. We are 19th on IMS’ latest ranking for the

operations?

ethical market, demonstrating that our work has positively

A: These market trends have been beneficial to our

impacted the segment.

operations. New marketing models have propelled Novag’s growth as its market share participation in the

Q: Novag is planning a MX$100 million (US$6.7 million)

branded generic segment is quite large. We are not

investment for a new manufacturing facility. How is this

selling a brand but rather a molecule. Distributing our

project moving along?

own branded generics has propelled the company’s

A: We acquired a new manufacturing plant in Tizayuca,

growth over the past two years. We are strong suppliers

Hidalgo. We are still in redevelopment stages, refurbishing

to pharmacy stores, supermarkets and a number of

it and acquiring new certifications. But we are yet to

convenience stores amounting to 55 percent of Novag’s

define the products that will be manufactured there.

overall sales. The remaining 45 percent is attributed to

Although there are still loose ends Novag took a big step

the public sector, as we have secured multiple tenders

by investing and acquiring its new facility. Our business

throughout the years.

model is supported by extensive volume production, which will be secured with our Tizayuca plant.

Q: What new projects does Novag have in store for 2016? A: We will finally see the Novag brand reach Central

We are working on expanding our portfolio in areas

America. Last year, the company won three product

that have not yet been covered, such as hormones.

tenders in Honduras and we are registering six products in

Novag recently developed two retroviral drugs for

the Costa Rican market. Regional regulations are no easy

HIV treatment. We are still evaluating the injectable

task, especially in Costa Rica as it follows FDA guidelines.

pharmaceutical formula. The generic HIV segment has

Nonetheless, the company will gain recognition and grow

grown significantly in recent years as patent expiration

exponentially when it prevails. Ecuador and Peru will surely

has further increased their accessibility coupled with the

follow, further expanding our presence in Latin America.

government’s push for their development. We may move

Novag settled on Guatemala, Honduras and Costa Rica,

these developments to our Tizayuca plant. However, our

mainly because they are similar to Mexico’s market. The

next course of action is yet to be defined. Manufacturing

regional market volume these countries jointly make up is

large volumes of drugs in our new facility makes sense

extremely interesting.

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SHOOTING FOR 1,500 SALES POINTS BY 2018 ROBERTO LEÓN Director General of Farmacias GI

104

Q: Farmacias GI’s main vision is to become the largest

A: We evaluate which chronic conditions affect the

pharmaceutical distributor in Mexico. How close is the

Mexican population the most then we look for a range

company to reaching this goal?

of medication that will soothe those ailments and

A: By mid-2016, the transformation of Farmacias GI’s

laboratories. Our partners must comply with all health

corporate image must be complete. Then we will begin

registries established by COFEPRIS, mainly regarding the

our expansion efforts, which are already strategized

NOM-059 that impacts both laboratories and distribution

and analyzed. According to our agenda we will maintain

warehouses. The company will always put quality first.

controlled but significant growth in the coming months and there will be 1,500 selling points within the brand by 2018.

Q: What are the most innovative products that Farmacias

After our new branding is secured all new stores will be

GI sells?

incorporated into our company marketing strategy, which

A: We have many more specialized products than we

mainly focuses on the lower and middle socio-economic

once did. We have not lost track of our original purpose

strata, commonly known as the D and C segments.

of focusing on generic medication. We will continue bulking up on similar volumes. Today eight out of 10 drugs

Q: How will your new image translate to an increased

consumed by patients are generics. We want to encourage

number in sales and market share?

R&D in Mexico and support laboratories that create new

A: Our corporate image restructuring has so far resulted

biotechnological

in a 20-25 percent sales increment as new socioeconomic

drugs and commercialize them. But the Mexican market

spheres are paying attention to Farmacias GI simply because

is moving toward generic drugs and major transnational

of our new image and refurbished distribution points. The

companies are acquiring local generic laboratories to

middle-class market share initially fell as it was believed

cover the growing demand.

molecules,

manufacture

specialized

our products would see a price increase. After realizing our change merely referred to image and quality of service with

Q: Where will we mostly see the Farmacias GI expand?

no impact in our prices we re-stabilized our margins.

A: Our brand has been well received in every market we enter, most of all in Jalisco and Queretaro due to

Q: How does Farmacias GI ensure the right training of its

the number of franchises. Aguascalientes will see more

doctors at the point of sale and how does it attract the

franchises, as our new image has helped establish 18 new

best available talent?

pharmacies. Guanajuato, Colima and Michoacan will see

A: At the end of the day, we must keep in line with

the biggest growth as they are responsible for a significant

COFEPRIS regulations. It states that all physicians must

portion of our business. Farmacias GI will first strengthen

have a valid professional license and an individual service

its position then explore new markets. We will eventually

registry that Farmacias GI takes care of. That is the

have a presence throughout Mexico.

foundation of our operations. We also hold continuous training sessions with our commercial partners mostly led

Q: How has Mexico’s generic market evolved in and where

by laboratories in Mexico. They help us by providing our

is it heading?

physicians with up-to-date information of the products we

A: The taboo surrounding generic products has been

commercialize for them allowing them to better assess our

removed. Through NOM-059 pharmacovigilance generics

clients’ conditions and achieve better patient outcomes.

has strengthened, requiring larger investments and certifications from manufacturers. The market understands

Q:

into

the efficiency of generic products largely as the result of

consideration in their commercial partner selection

What

elements

does

Farmacias

GI

take

the government’s efforts. This information is reaching all

process?

socioeconomic segments.


| VIEW FROM THE TOP

REGULATORY COMPLIANCE IS AN ADVANTAGE

Salvador Berríos Director General of Qually

Graciela Aguilar Technical and Regulatory Director at Qually

Q: Only 1.2 percent of multinational clinical trials are

SB: Maintaining COFEPRIS certification is one of Qually’s

conducted

Qually

main strategic pillars, which calls for ongoing investment

implemented to attract more studies and clients into the

in

Mexico.

What

strategies

has

every two years. Adapting to new norms requires large

country?

expenditure in both financial and human capital. COFEPRIS

GA: Qually signs agreements with third party clinical trial

demands that we adapt to newer and better quality-

institutions, while the company monitors studies and

management systems and although we have complied

analyzes samples. We conduct our analysis through state-

systemically, doing so is quite problematic. Training our

of-the-art analytical instrumentation. After obtaining

workforce is essential as we must show comprehensive

comparative results between generics and referenced

technical competence at all times. Qually is an extension

drugs, Qually conducts statistical analysis based on

to Mexico’s sanitary authority and although its clients

COFEPRIS norms and regulations, later producing a

are extremely important, producing comprehensive and

comprehensive report. The company’s strategy to secure

accurate reports is even more so.

business is directly correlated to its capabilities as an analytical entity. Qually’s certifications and platforms have

Q: How is Qually developing new processes, products and

validated its mechanisms giving us an edge against our

services, seeing as only 0.45 percent of Mexico’s GDP is

competitors. We make our analytic methodology available

allocated to R&D?

to clinical trial sponsors and we get reliable results in a

SB: Rather than innovating our services we are adapting

timely manner.

our laboratories. In return, we will offer a broader line of services. At a policy level, Qually cannot innovate, because

Q: What do you perceive as the biggest challenges the

the company must keep in line with the enforced legal

industry is facing?

framework. By continuously investing in our operations

GA: Even though the Mexican market does not have many

we can better service our clients. Thereafter, internal

third party clinical research entities, competition will

growth will follow by expanding our technical capabilities.

continue as Qually’s biggest challenge. When companies

Instead of developing innovation, Qually uses innovation.

like us initially began the demand for our services was

We must have sufficient purchasing strength to refurbish

booming. Clinical trial studies grew substantially as

our facilities.

compliance with the 2005-2010 regulations overloaded the industry.

GA: Innovations are becoming increasingly stagnant worldwide. Between 2015 and 2018 a large number of

Most analytical methods were provided by Qually sticking

high cost and high specialization patents will expire.

to its trademark responsiveness and timeliness. We are

Qually starts its generic bioequivalence studies two years

usually given four weeks to conduct analytical studies

before patent expirations, licensing them with COFEPRIS

however our excellent equipment takes as little as one week

immediately after. Promptly filing dossiers drops a

to produce reliable reports. As such, we retrained most of

product’s costs by at least 60 percent.

the business servicing a big part of the demand. Not every contract research organization (CRO) is capable of handling

Q: What are Qually’s ambitions and where will we see the

such a workload with high-efficiency levels as sensitive

company in 2016?

equipment and analytical mechanisms like Qually’s require

GA: Qually is looking to expand its operations in Mexico.

large investments. Although competition became fiercer

We will look into different regions as more space is

as the demand grew thinner we have the mechanisms to

needed. We have reached full capacity in our facility

guarantee prompt health-record-approvals. There is little

putting a halt on our goal. So far, we have looked at

room for inaccuracies as the financial stakes are enormous.

Guadalajara and Toluca.

105



MEDICAL DEVICES

5

From the companies that assemble products locally for the export market to those who are developing cutting-edge technologies in the country, Mexico is increasingly becoming a hub for high-tech medical device manufacturing and commercialization. This market segment turns the newest digital and electronic advances into solutions for patients with increasingly demanding lifestyles and who remain active to more advanced ages.

Mexico has become a home to companies pushing the envelope to bring medical care into the 21st century and beyond, with devices ranging from state-of-theart scanners that help doctors take a deeper, more understanding look at their patients’ conditions to prostheses that allow their users to hear better, walk longer, breath more deeply and keep potentially debilitating conditions in check. Industry clusters also are increasingly involved in turning places like Tijuana, across the border from San Diego in the US, into vital hubs for innovation and manufacturing to help medical practitioners deal with the challenges of a globally aging population. This chapter showcases some of the key participants in the medical innovation field, as well as the companies that facilitate system integration and certification to get health-improving technology to the market.

107



| CHAPTER 5: MEDICAL DEVICES 110

VIEW FROM THE TOP: Martín Armesto, GE Capital

110

VIEW FROM THE TOP: Mario Amadio, GE Healthcare

112

VIEW FROM THE TOP: Martín Ferrari Del Sel, Dräger Medical Mexico

113

VIEW FROM THE TOP: Francisco Morales, 3M

114

VIEW FROM THE TOP: Alejandro Paolini, Siemens Healthineers

115

VIEW FROM THE TOP: Guillaume Corpart, Global Health Intelligence

116

VIEW FROM THE TOP: Patricia Villar, Canon Mexicana

118

VIEW FROM THE TOP: Carlos Jiménez, B. Braun Aesculap of Mexico

119

VIEW FROM THE TOP: Jorge Hernández, Greatbatch

120

VIEW FROM THE TOP: Fernando Oliveros, Medtronic Mexico

122

VIEW FROM THE TOP: Luis Nieto, ConvaTec

124

VIEW FROM THE TOP: Eduardo Salcedo, Össur

126

VIEW FROM THE TOP: Matt Jordan, Providien

128

VIEW FROM THE TOP: Kota Yamamura, Terumo

129

INSIGHT: Luisa Gutiérrez, Medisi

130

VIEW FROM THE TOP: Cristina Hermosillo, Cluster Tijuana EDC

Ángel de la Campa, Medical Devices Cluster

Miguel Félix, Medical Devices Cluster

131

INSIGHT: Carlos Pérez, NYCE

132

EXPERT INSIGHT: Rubén Gaitán, Alandra Medical

133

VIEW FROM THE TOP: Lourdes Camp, Ventura Medical Technologies

109


| VIEW FROM THE TOP

GE TO FINANCE HEALTHCARE TECHNOLOGY ACQUISITION MARTÍN ARMESTO Regional Manager of GE Capital

110

Q: What is the future of GE Capital Health Financial

way by financing healthcare technology acquisition. GE

Services as GE transforms into a more industrial company?

is the only medical equipment manufacturer with a real

A: We have financed equipment acquisitions in Mexico

bank supporting its capital and financial operations in

for the last 25 years. However, GE Capital is undergoing

Mexico.

a number of structural changes. We will be more focused on helping GE Healthcare with specific products and

Q: What is behind GE Capital's focus on the healthcare

tailor made solutions developing new business models

industry?

similar to the shared risk structure seen in the US. Even

A: There are several opportunities with consumers

though it will take some time for this trend to catch

acquiring new technology, which is especially true with

up in Mexico, we are already doing things differently

doctors and health institutions. Although there are

with our customers. GE Capital will eliminate all pieces

opportunities in the public sector that are worth pursuing

unrelated to its four integral business solutions, which

timely payments are an issue. The industry pushes for

are Healthcare, Energy, Working Capital Solutions and

equipment replacement every five to seven years, but the

Capital Aviation Services (GECAS). The company is

public sector does not have enough resources to fund

paying more attention to its GE Healthcare division,

this. As such, the lifetime of their equipment is extended

which will increase sales in a smart and risk-controlled

by three, four or even five years, quickly becoming

| VIEW FROM THE TOP

LONGER LIVING POPULATIONS DRIVE HEALTHCARE INNOVATION MARIO AMADIO President and Director General of GE Healthcare

Q: What is the history of GE Healthcare in Mexico?

lead company in the digital industry. Bringing this to

A: This year, GE will be celebrating 120 years in Mexico,

our Healthcare division is a real challenge but we also

an important step in both GE’s and Mexico’s history. GE

consider it a responsibility and opportunity.

Healthcare Mexico has always had the best international standards and today we are present across the country

Q: What growth has Mexico experienced in its internal

and in all of the same business lines as GE Global. Looking

consumer market and solution exports over the past years?

to the future, we would like to speak less and less about

A: The healthcare industry developed as a consequence

boxes and products and more about solutions. Mexico

of an aging population. The challenge that healthcare

is extremely important for GE Healthcare Global for

systems across the world are experiencing is that people

various reasons. Because of its geographical closeness

are now living longer than ever before and this trend is only

to the US, Canada, and Latin America, we are allowing to

starting. Not only are these people living longer, but they

create many opportunities. Mexico is also Latin America’s

also demand a better quality of life, which puts even more

second biggest market after Brazil, and its approximately

pressure on healthcare systems, placing this challenge

128 million inhabitants provide a significant internal

as one of the top priorities. I do not predict exponential

consumer market. I also see many opportunities in

growth for the industry but rather a rationalization of

the digital area now that GE has defined itself as the

expenses. Investments in the health industry will go


obsolete in an evolving environment. Large volumes

a market willing to purchase secondhand equipment. This

of used equipment are imported to Mexico from the

will undoubtedly reach Mexico within three years. Another

US, often in poor condition, which is one of the largest

trend will be a plethora of investors and entrepreneurs

sources of competition within the Mexican medical device

in the healthcare industry. Today, there are several

industry. As the US market grows it generates yearly

investment funds seeking opportunities in the industry. In

tons of turnover equipment. But challenges related to

the past, it was mostly physicians who were looking for

investment remain. With the US reimbursement act the

funds to develop a business. With the digital revolution,

MRI studies has dropped significantly. However, annual

healthcare services were lagging behind as all information

per capita expenditure in the US is US$11,000, whereas

was confined and considered strictly confidential. But

in Mexico it is close to US$800. Considering some of

new investors are trying to understand patient needs,

our customers are major hospital chains and clinical

and healthcare is being addressed directly from a supply-

laboratories expanding throughout the country their

demand standpoint.

strong purchasing capabilities must be supported by financial solutions that will help them in this endeavor.

Q: Do you offer financial services to the government,

Key players are expanding and consolidating their

and how are integrators enabling public institutions to

operations, opening up a new realm of opportunities for

acquire technology?

GE Capital.

A: The value proposition of integrators is providing customers with technology, technicians, logistics, IT

Q: Tailored solutions like the shared risk model are

solutions and administrative tools for supplies and

already operational in other countries. When should we

equipment. Formerly, public institutions acquired their

expect their implementation in Mexico?

assets from providers. Nowadays, a large percentage are

A: Shared risk solutions are an essential part of healthcare

managed by integrator companies, which led us to lending

negotiations in the US as they offer financing alongside

them money directly. Although public sector lending is not

actual solutions. There are instances where technology

in our immediate plan this is something we will explore in

renovation can be easily achieved, which shows there is

the near future.

toward better health and better care, and expenses will

say it has had a tremendous impact. Mexico has strongly

be scrupulously analyzed to make sure they contribute to

benefited from our strategy to tackle areas of opportunity

this improvement. GE wants to support and be part of this

and to increase coverage. The latter has allowed us to reach

response. From there, topics such as accessibility, cost and

all areas of the country.

quality come up and these have been the three pillars of our strategy for a few years now. When it comes to growth

Q: What are the biggest advantages of GE’s medical

in the Mexican healthcare industry, this is happening

imaging equipment compared to your competitors?

slowly. I do see a huge opportunity particularly in the

A: Our strength in that area and in the entire company is

digital industry. It is estimated that over the past few years,

innovation. It is part of our three main characteristics along

the most relevant industry has been online consumption,

with service and solutions. Our challenge is to innovate in

expected to duplicate business turnovers.

a wide portfolio and also differentiate ourselves through quality.

Q: Has GE’s “Amplia el Acceso” program been implemented in Mexico and what have been the results if so?

Q: What does your Health Imagination initiative involve?

A: In 2000, 70 percent of GE’s market was the US domestic

A: The three pillars of this initiative that began seven years

market while the rest was the international market. In the

ago are accessibility, cost and quality. GE put this concept

past few years, this figure has changed and the market

forward to be audited by external companies to ensure

outside the US has become a great market with several

that all investment fell under one of these three mentioned

opportunities for growth. Not counting Europe, this

categories. The success of this initiative is linked to a

leaves us with the emerging markets, where we’ve found

redefinition of our market strategy. Our next projects will

considerable opportunities so we have put great effort

be centered around the digital realm, which we believe this

into creating products tailored to that region. We have

to be the next area of opportunity. We have our research

lowered the cost to make them more affordable without

center in Queretaro, which is important for the development

compromising on quality. There is no hard figure as to

of our digital strategy. We focus on offering better products

the impact of our “Amplia el Acceso” program but I can

with better technology, availability and clinical value.

111


| VIEW FROM THE TOP

TECHNOLOGY FOR PUBLIC AND PRIVATE HEALTHCARE MARTÍN FERRARI DEL SEL Director General of Dräger Medical Mexico

112

Q: What opportunities do you see for Dräger in the

capabilities. This helps doctors and personnel understand

country’s plans to construct new hospitals?

how the patient is doing during the anesthesia but also

A: We are working with IMSS on their new projects to

which level of anesthesia is necessary for an optimal

see how our solutions could help reduce costs and make

operation,

investments even more efficient. We also want to help

Of course, these advantages go hand in hand with

make the operating room more efficient and contribute to

cost reductions. We have also launched a new LED-

a transition toward a digital future. More than just thinking

technology lamp called Polaris 600 for the operating

about the equipment bought in terms of boxes, we want

room. It is completely integrated with the rest of the

IMSS and ISSSTE to consider the solution. Dräger has

operating room's control systems. More and more, we

systems that integrate all of the information collected by

are talking about intelligent or hybrid operating rooms,

our equipment, be it on our processes, machinery or on the

where all the pieces of equipment are integrated from

patient. Although digitalization is spreading throughout

the lamps to the chairs. Mexico is still behind in this

the various departments of a hospital, the technology has

respect but we are trying to bring the technology to the

yet to reach some of them.

country.

Q: What does your intensive care package involve and

Q: How do the planning and buying processes of the

how does it benefit hospitals?

private and public sector differ?

A: We have had a regional and national initiative since 2015

A: INCAN has developed a new hospital with the latest

to create a solution using the extent of our international

technology, which required significant investment. For

portfolio. Packages can be created from this wide range

this, they did not just consider the equipment but the

of products that are adapted to local needs. The neonatal

entire clinical process involved. The hospital is equipped

care package for instance is entirely tailored to the

with the latest equipment, machinery and measurements.

Mexican market and we are continuously making it more

Although one might not expect this, we have observed

and more attractive price wise. We have an important

that the public sector is more willing to innovate or acquire

presence throughout the country’s Ministries of Health

innovation than the private one. This is especially the case

and IMSS and ISSSTE clinics. We have also strengthened

in highly specialized areas of the public sector.

depending

on

the

patient’s

physiology.

our presence in SEDENA, particularly in anesthesia and mechanical ventilation.

Q: How do you ensure you maintain a good supply chain and competitive products?

Q: What new technologies are you going to introduce to

A:

the market?

destination than the US, we are neither manufacturing nor

A: In areas such as critical care and intensive therapy, we

assembling here. This is in our short-term plan for certain

are introducing a new line of mechanical ventilators that

products. To date, our manufacturing and assembly has

will be applicable to everyone from newborns to adults.

been carried out in the US or Germany and this is one of

This piece of equipment helps reduce the duration of

our main strengths. We do not want to lose our “made in

stays in intensive care units, reducing all of the associated

Germany” quality trademark. Now that we are present in

costs and the pathologies associated with the treatment.

the Latin American region, we might take advantage of

Although

Mexico

is

a

cheaper

manufacturing

its cost competitiveness. The headquarters for this area When it comes to the operating room, we have launched

are located in Panama and we have seven branches from

new technologies for anesthesia equipment that is

Mexico to Argentina and Chile, as well as Peru, Colombia

completely integrated with our patient monitoring

and Brazil. This is advantageous in terms of the closeness

technology, providing the equipment with predictive

of the service, sales and supply chain.


| VIEW FROM THE TOP

INNOVATING FOR CHRONIC, DENTAL AND FOOD HEALTH FRANCISCO MORALES Healthcare Division Director at 3M

Q: Why did 3M decide to focus on three areas?

experience where the product can be tested. We have a

A: In Mexico, we have the hospital market, which is divided

center of innovation in Santa Fe where we receive many

into infection prevention and critical & chronic care

customers to test the product and learn how to use it in

solutions products. The second market is oral care, which

a risk-free environment.

is divided between dental and orthodontist services. The third area, food safety, is important for Mexico. We based

Q: What strategies are you implementing to grow your

our three areas on customer needs. Looking at the market

market share?

today, each category would occupy 20-30 percent. When

A: We want to grow organically, with more units sold in

the market evolves and practices improve, the market will

the marketplace as that represents sustainable growth

increase. For example, a product is usually used in surgery

for the business. We are focused on gaining a better

once a week. Bio indicators can show if there is any bacteria

understanding of the customers and providing better

present. Should the practice become daily, then the market

solutions. We have switched from providing product-

for bio indicators will be multiplied by seven, and to be sure

based solutions to a care pathway that involves better

hygiene products may be tested more than once.

control during operating procedures, which makes the outcome of operations constant, providing safety and

Q: What barriers have you encountered in convincing

improving processes. The care pathway is implemented

both private and public sectors to switch to an electronic

in all three sectors. We are particularly looking to reduce

system?

infections in hospital operating rooms. As for the food

A: Interfaces have to be user friendly. We have technology

safety department, there are companies that produce

that rapidly detects pathogens in the food industry. The

goods here in Mexico and export them to the US. They

interface is easy to use and customers love it. As soon as

need to comply with high-quality standards and this

users are convinced that a protocol is correct, they will use

is what we assist with. We estimate this area will grow

the product and the barriers fall. In dental for example,

around 7 percent and we have been investing heavily.

we have a digital scanner. When going to the dentist patients undergo an indirect procedure, an impression of

Q: What relationship do you have with academic

the mouth. This requires a 5-to-6 minute wait, the product

institutions and the government to ensure specialization

must then go to the lab and a mold has to be made. Our

of human capital and to make sure they are channeled to

digital scanner has a wand to scan the mouth. It takes

the right careers?

a digital scan that is stored on a computer and can be

A: We have a lot of talent in Mexico. I used to work in

sent to a lab without the need of a physical item. This

the Minnesota headquarters and many Mexicans held

accelerates the work flow.

strategic positions. As for working with universities, we actually held an event to which we invited students from

Q: What added value are you bringing through your

any university in Mexico. They presented their work,

dental and orthodontic training programs?

we provided them with a specific task they must find a

A: The educational side is strategically important for

solution to and thus we capture the talent early on. This is

us because we tend to do the same things every day

a global program called Invent a New Future in which we

and when changing practices we need to learn from

work with many institutions. It starts with a competition

someone else. All our healthcare training comes under

at the national level, then they apply to the international

the umbrella of our healthcare academy. It is a global

level and two students are chosen from each country.

initiative we implement in every sector. In dental,

There are various winners who win a six-month internship

this mostly takes the form of a speaker presenting a

with one of the directors. Of last year’s six winners, one

product and the practice. Then there is a more hands-on

was Mexican.

113


| VIEW FROM THE TOP

TECHNOLOGY FACILITATES MINIMALLY INVASIVE SURGERY ALEJANDRO PAOLINI Vice President Mesoamerica of Siemens Healthineers

114

Q: What are the results you have had in 3D image-guided

Q: What separates Siemens Healthineers and its medical

surgery and how do you commercialize this?

imaging devices from those of your competitors?

A: We have six business areas: Diagnostic Imaging,

A: We are the only company that covers 100 percent

Advanced Therapies, Ultrasound, Laboratory Diagnostics,

of the diagnostics field. Probably less than 5 percent of

Point of Care and Services. 3D image-guided surgery is part

diagnostics are based solely on physical examinations.

of Advanced Therapies. Siemens used to be concentrated

One possibility is to base a diagnostic on an image of the

on the diagnostic phase of prevention, diagnostics, therapy

body, while another is to use laboratory tests. Siemens is

and monitoring. We are now expanding our products to

the only company to cover both imaging (in vivo) and lab

the therapy phase. 3D image-guided surgery falls directly

tests (in vitro).

into the third phase. Our solutions facilitate the work of the surgeon as we are guiding the surgery, so the outcome is

As for our medical imaging devices, of course we want

assured. Our therapy phase solutions provide alternatives

to differentiate them from those of our competitors. More

to invasive procedures. This results in important savings

than US$1 billion was invested in R&D in 2015 and we

from both surgery and recovery phases. With minimally

registered around 1,500 new patents. Every innovation has

invasive procedures, the patient can sometimes return to

to go through our internal filters and provide advantages

their normal activities much faster.

in three fields: the clinical field, the operational field and the financial field. An innovation that provides wonderful

Q: What are Siemens Healthineers' innovations in terms

clinical advantages but does not bring financial advantages

of digital health?

may not be feasible.

A: Digitalization is one of the main market trends. It could definitely help with the mismatch between the

Q: What are the main benefits of the Public Private

budgets and costs of health systems. A clear trend is the

Partnership (PPP) approach that you have?

prevalence of mobile applications. We are paying close

A: Managing equipment services (MES) is one of the many

attention to market trends and transformations. This

solutions we offer our clients. It is an alternative to the

is vital for Siemens’ strategy globally and for Siemens

typical purchase of equipment. In the case of PPPs, we

Healthineers. Just like in our services area, we have a

believe this is a good solution as usually, a PPP is long-

digital services line of business. We are investing greatly

term. Examples from Mexico show PPPs last around 20-

in this area. We have the typical solutions such as picture

25 years. An advantage of MES is that you can reduce

archiving and communication systems (PACS), radiology

the initial capital investment and this capital expenditure

information system (RIS), and laboratory information

is turned into operational expenditure. Our clients have

system (LIS).

a reduced need for initial funds and they can also easily predict operational expenses over the term of the project.

We are also exploring new alternatives because in

This differs from the traditional route of us selling the

emerging countries we are still moving from analog

equipment, then after the expiry of the warranty providing

systems to digital. It is vital to invest in this as we know

maintenance contracts. In this case, we still own the

everything will be 100 percent digital at some point. We

equipment so we are responsible for maintaining it. The

also have a cloud-based platform (TeamPlay) where

client instead is buying a service. We are sharing the risk

clients can share information and results with the rest of

because they are paying based on performance.

our clients at a global level. This allows them to discuss new treatments and different results. There are many

At this moment, we have several projects in the funnel but

solutions we are offering and that we want to offer in the

none is being fully implemented. This model works well in

digital era.

mature markets such as the US and Europe.


| VIEW FROM THE TOP

PRIVATE SECTOR EXPANSION PUSHES DEVICES GROWTH GUILLAUME CORPART Managing Director of Global Health Intelligence

Q: Even though the medical device market has not grown

manufacturers and distributors have had to reduce their

much in value, there has been an increase in volume.

margins. There is limited innovation in the medical device

What is behind this growth?

space in Latin America, with 95 percent of equipment

A: A vast expansion of the private sector across the region,

being imported. In a time of currency devaluation, this

particularly in Mexico, is the main cause coupled with

situation makes it more challenging for hospitals to acquire

the growth of specialty low-cost clinics. Traditionally, the

new equipment. As such, a shift in purchasing trends is

private healthcare market was reserved for the wealthiest

spotted in the types of equipment being imported. The

15 percent of the population while the rest of the population

volume of medical equipment being imported increased

depended on public services. A transition is occurring

15-20 percent from 2014 to 2015, while the value increased

where the private sector is now focusing on expanding its

a mere 2 percent, from US$5.1 billion to US$5.2 billion.

services toward the middle class and working class. Salud

This implies that institutions could be buying less

Digna in the northwest of Mexico is a perfect example. It

expensive equipment, such as refurbished or second

started six years ago as a small clinic in Sonora with the

hand goods, as well as squeezing their suppliers’ margins.

intention of being an affordable private clinic. Now, it owns

Out of the 25 percent depreciation in Mexico in the past

over 40 clinics throughout Mexico and some in the US,

months, distributors absorbed 10 percent internally, and

covering 15 specialties from eye care to diabetes. People

manufacturers as well, but only passed 5 percent of cost

are willing to pay a little bit of money to have faster and

differences to the payer. On their end, institutions are

better services than what the public health sector offers.

purchasing less expensive equipment and turning to less

The growth potential is tremendous. When it comes to

dollarized economies for imports. In the past year, some

care, a boom is coming that has not yet reached Mexico.

of our clients switched from importing US equipment to

Growth in the home care market is already being seen in

importing from Eastern Europe where there is a smaller

Chile and Brazil. Rather than treating people in the hospital

currency shift. Chinese products are also starting to take

and occupying beds for patient monitoring, people are

a strong position in the market. Mexico is still the biggest

being sent home with portable monitoring devices. A visit

exporter of capital equipment thanks to its maquiladoras.

to the hospital should only occur for patients that need to

Items that are part of the maquiladora category are

see a doctor or nurse. Individuals that only need check-

required to be exported even if some are meant to be

ups should be able to take these devices and do it in the

imported back later. A shift in this particular reality is not

comfort of their home. The equipment will communicate

expected any time soon as the US will continue to be a

with the doctor when a problem occurs. The idea of home

strong market.

care is expected to come to Mexico in the next three to four years.

Q: For the next year, how does Global Health Intelligence hope to position itself?

Q: The specialty medical devices market grew 20 percent

A: In 2016, we are striving to initiate work in Cuba, a

in 2015 in Latin America and even though Mexico is the

truly interesting project as quite little is known about

largest exporter in the region, most of its medical devices

the country from independent sources. We will focus our

are imported. What can we expect in Mexico when it

efforts on medical devices in emerging markets, notably

comes medical device commerce?

Latin America and Asia for both the public and private

A: We saw a 35 percent currency depreciation across

sector. We have the unique advantage of holding a pan-

the region over the past 18 months. Mexico was no

regional database that can help drive policy decisions in

exception, witnessing a 25 percent currency depreciation.

an informed manner. We welcome the idea of collaboration

The devaluation has made equipment more expensive in

with manufacturers, distributors and integrators as well as

local currency. To maintain sales and hold on to clients,

the government and policymakers.

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| VIEW FROM THE TOP

OPTICAL DEVELOPMENTS FOR A HEALTHIER LIFE PATRICIA VILLAR Sales & Marketing Manager Healthcare Division of Canon Mexicana

116

Q: What is the importance of the healthcare solutions

Q: What part of your sales go to the private and to the

division within the Canon global strategy?

public sector and what market needs are you targeting?

A: For Canon, the Healthcare Solutions Division has

A: At this point, the most important buyer of healthcare

become a relevant investment priority for the global

products is the public sector, with 75 percent of our sales

strategy. The company is committed to innovation and

and the rest in the private. In both sectors demand is

health promotion and our research centers in the US and

important, but in the public division the investment will

Europe are focusing on developing the most accurate

start growing. One of the most relevant epidemiological

diagnosis equipment, always considering the least invasive

diseases is diabetes and one of its complications is

methods for the patient. We are developing state-of-the-

retinopathy. In the eye care area we have diagnostic

art medical products using advanced expertise in optics

solutions for these diseases and we see a huge business

and CMOS sensibility technology. Canon’s investment

opportunity there. With the increasing demand for high-

through Canon Life Science and Canon Biomedical, which

quality services in Mexico, there is an increasing need to

was founded a couple of years ago, will result in many

be more efficient and innovative. We are aware of today’s

innovative products that will expand our portfolio in the

economic circumstances affecting the healthcare market

following years. As a group, stakeholders are guiding the

and especially the public sector. Canon is focusing on

global strategy, focusing on diversifying our business

offering innovative technology that provides the highest

opportunities to bear the fluctuating market situation and

resolution images in the market at affordable prices.

global challenges. Q: What kind of innovative technological solutions do you Q: What was the strategy behind establishing Canon’s

provide and how do they stand out in the market?

medical devices and applications in the country in 2012

A: We have cutting-edge retinal cameras and in the short

ahead of other countries in Latin America?

term we will have an optical coherent tomography. We

A: We had a presence for many years in the Mexican market

also have tonometers to measure intraocular pressure

through distributors, who have successfully positioned our

and the high levels in glaucoma as well as auto-refractor

brand. A few hundreds of our digital detectors are already

keratometers that measure the diffraction of the eye. In

installed in the most important healthcare institutions,

radiology, we have digital detectors that deliver very good

thanks to their hard work. Our strategy of having a direct

images and are supported by high-tech software. These

presence in Mexico includes working together with our

technologies already exist in the market but the most

distributors and letting them commercialize our products,

important part of our equipment is their quality, and we

while we take care of regulatory affairs, imports and

have the experience in the camera business and in high-

technical support. We want to build synergies and back our

quality images to back us up. Another differentiator is

distributors in integrating our products into sophisticated

our expertise in the imaging-related technology products,

solutions, creating strong relationships with institutions

applied to medical diagnosis development. For instance,

and medical centers.

we have also successfully developed a CMOS sensor that delivers an image resolution of approximately

Mexico is the second most important market for healthcare

120 megapixels, the world’s highest level of resolution.

products in the Latin American region after Brazil.

By

Canon is broadening its opportunities and increasing its

technologies, we believe Canon’s camera technology has

participation in the healthcare business in the Americas

the power once again to drive the company’s growth. We

in general and specifically in Mexico where the medical

also always try hard to maintain our prices at competitive

devices market is expected to have an annual growth of

levels by preserving our resources, being internally

6 to 7 percent.

efficient and economically strategic.

thoroughly

raising

our

powerful

camera-related


Q: How have you managed to build brand loyalty in the

the diagnostic services and equipment in institutions, they

healthcare market?

would eventually save much more.

A: We provide training to doctors and we also work very closely with them to detect market needs. The company

Q: What products do you have in the pipeline?

does not only provide quality products but strong post-

A: We have the optical coherent tomography and we are

sale services. There are satisfied physicians who own

strongly focusing on our X-ray portfolio this year. Digital

20-year-old Canon products that are fully functional,

radiology is a highly promising market, so we will bring new

creating a tight relationship based on trust. Word-of-

technologies in this area. We are changing our strategy

mouth is the most powerful way of advertising and

throughout the Mexican territory and in our target market.

Canon has really benefited from it. We have seen that our

That is why we will not only focus on big institutions, but

customers usually think of Canon again when they need to

we will work with our distributors to reach remote areas

replace their equipment.

that have unattended needs.

Furthermore, closeness is essential to keep building

Decision makers in healthcare are centralized and the

customer

preference,

market in big cities is saturated now. We want to make

ultimately leading to success. Every accomplishment

our technologies accessible in other parts of the country

requires hard work and effort and our distributors have

to benefit more patients. If we expand our sales force

done an excellent job positioning our brand. We are still

throughout the country we will have more opportunities.

loyalty

and

preserving

their

finding new customers that are surprised when they hear Canon also manufactures healthcare products.

Q: What do you want to achieve going forward and what

Fortunately, they are familiar with the quality image and

makes Canon different from other companies from the

the service associated with our brand, and consequently

business philosophy standpoint?

they feel confident to acquire our diagnostic equipment.

A: We will focus on providing dependable services and increasing customer loyalty by consolidating our brand,

Q: How do you collaborate with the public sector to

helping us to be more profitable and competitive. Canon

develop the best model for institutions to acquire your

is really focusing on diversifying its business and the

equipment?

healthcare market is very promising.

A: We are participating in the public sector through integrators and these players offer shared risk solutions so

We are investing 9 percent of our revenues in R&D, which

that institutions can acquire innovative technologies. We

will keep on making us very competitive. Our corporate

provide the end user with technical support and holistic

philosophy is based on “Kyosei”, which means living and

service plans. The most important advantage of working

working together for the common good. This philosophy

with integrators is their solid experience in implementing

reflects our true commitment to human wellbeing and that

complex and valuable solutions to customers so they

is why the healthcare division suits perfectly well with the

can fulfill market needs in a specific way. Teamwork and

company’s mission, vision and core values.

synergies are always better than working alone. Q: To what extent are regulations for registering new medical devices supporting growth in this industry? A: We sell radiology and ophthalmology products that need sanitary registrations to be imported and commercialized in Mexico. This process can take us from two to six months. We usually undergo fast track procedures in which we use equivalences with the aid of Health Canada documentation. We also receive support from Canon in Tokyo and the US in the case of FDA 510(k) documentation. COFEPRIS recognizes these certifications and it has worked really hard to streamline authorization processes. More efforts are needed for healthcare to become a priority in the government’s agenda. The Ministry of Health

“Canon is broadening its opportunities and increasing its participation in the healthcare business in the Americas in general and specifically in Mexico, where the medical devices market is expected to have an annual growth of 6 to 7 percent”

has to realize that it is better to prevent diseases rather

Patricia Villar, Sales & Marketing Manager Healthcare

than curing them. If the authorities invest in strengthening

Division at Canon Mexicana

117


| VIEW FROM THE TOP

HEALTH TRADE GAP HIGHLIGHTS BUSINESS OPPORTUNITY CARLOS JIMÉNEZ Director General of B. Braun Aesculap of Mexico

118

Q: How has the medical device industry contributed to

The new prostheses have benefited 250 people so far, an

the country’s health sector?

impressive statistic for an implant in its first nine months

A: The Ministry of Economy is increasing its involvement

on the market. Our 3D endoscope equipment is another

in this sector, as the country ranked eighth in the world

example of innovative technology. This system allows a

for medical device manufacturing. Mexico is No. 28 in

surgeon to observe depth on a screen while operating,

consumption of said products. While this is excellent for

which makes tying and closing surgery easier and more

our trade balance, the gap indicates too little spending on

accurate. This year we are launching hydrocephalus valve

medicine in the public sector and a lack of integration of

systems, a further example of our pioneering treatments.

innovation. B. Braun specifically exports 4 percent of its

Our business models aim to combine products with

total sales and 6 percent of its manufacturing. Last year

services and offer added value for patients. Our integral

we grew an outstanding 46 percent as a company and to

services are targeted at equipment and sterilization

date we have grown 30 percent. B. Braun hopes to close

central rules and across surgical treatments. The cost of

2016 with 25 percent growth.

our solutions is reasonable, which is vital for long-term treatments. That our prices are in Mexican pesos means

The medical devices that are most popular in Mexico tend

we can offer the same value for clients over 12-month

to be those with very basic applications. The public sector

periods.

represents 70 percent of our business and the majority neglects to employ innovative products. A large part of

Q: What are the greatest challenges you have faced in

the costs of treating a patient is in infrastructure or other

pharmaceutical logistics?

non-medicinal aspects, as the treatment only tends to be

A: We directly manage our own logistics, for which we are

5 percent of the cost. The public sector’s focus on saving

beginning to construct a new 3,000m2 logistics center

money in this small proportion of patient cost simply

with space for 4,000 pallets. This narrow-aisle center

generates a cost-oriented mentality.

will manage heights of up to six pallets, advanced water treatments and sustainable elements including Helios

Q: Which areas of the industry drive growth for B. Braun?

photovoltaic technology. We manage a mixed logistics

A: Hemodialysis is one of the fastest growing areas,

solution, including direct delivery to hospitals or personally

with a 10-15 percent market share. B. Braun’s vanguard

collecting medical equipment that requires maintenance.

technology for hemodialysis helped gain our market

This type of service cannot be matched by other logistics

participation. Glaucoma is another expanding market, as

providers due to technical particularities. Logistics is

chronic renal failure is affecting an increasing number of

becoming more challenging. Federal institutions are

people and B. Braun has solutions for these conditions.

participating in a consolidated purchase system, wherein

Across all business areas, our company is growing by a

they offer one price for about 900 locations and require a

minimum of 18 percent thanks to the high level of service

logistics solution across several states.

that differentiates us. Q: Where is B. Braun focusing the reinvestment of its Our new short-stem hip prosthesis, metaphyseal prosthesis,

profits in Mexico?

is becoming more popular. This minimizes the bone

A: Every year, B. Braun invests MX$20-30 million in

damage on implantation, making future replacement hips

modernization and introducing new technology to its

easier to insert. The previous product offered by B. Braun

manufacturing. We are focusing investments in three key

designed according to the anatomy of Mexican citizens,

areas, the most important of which is our logistics center.

Logical Angioplasty System (SLA), enjoyed 15 years of

The center’s cost will surpass MX$50 million (US$2.7

success in the market for more than 20,000 individuals.

million).


| VIEW FROM THE TOP

SHARING RISK FOR BETTER CARDIOVASCULAR CARE JORGE HERNÁNDEZ Operations Director of Greatbatch

Q: Greatbatch and Lake Region Medical have merged to

catheters and catheter shafts, acetabular reamers used

become Integer. What are the advantages of this merger

for hip implants and batteries for high-end applications

and what value will this bring to your patients?

like external defibrillators and to power external sustaining

A: There are two main advantages with this merger. We

medical devices. Our products are recognized for their

have become one of the largest medical device outsourcers

quality and performance and Integer has the roots set

in the world. This is valuable for our customers because we

down from its experienced legacy companies.

are able to offer a wide range of technical capabilities and business experience. Also, the two companies’ portfolios

Q: What continues to make Mexico attractive for

complement each other instead of competing. With this

manufacturing?

comprehensive portfolio of technologies and services, we

A: In 2005, Greatbatch built their first manufacturing plant

can continue driving innovation for customers.

in Mexico in Tijuana. The second was started in 2014 and we are finishing the transfer for that building to make it

Q: What are the benefits of being an outsourcing

fully operational. There are about 250 employees there.

company?

Mexico and specifically Tijuana, is attractive because

A: For our customers, one benefit of outsourcing is

of our strategic geographic location and our talented

sharing the risks of any enterprise. For example, you don’t

people. At Integer in Mexico, we do more than running

need to invest a lot of capital, rather use others’ capital

the company as a low-cost manufacturing site, adding

to continue the business or accelerate your initiatives

value to the process and therefore creating value for our

by expanding your ability to handle several strategic

customer in this global market where price reductions are

projects. Other resources, like infrastructure, facilities,

a big constraint for all the players. Our customer service

technical capabilities and leadership are all used to

metrics make us one of the best companies around the

support the strategy of any medical device manufacturer.

world, with on-time delivery rates above 98 percent for

Our infrastructure and technical capabilities allow Integer

the past seven years and less than 300 defective parts per

to support our customers needs, from R&D to a finished

million produced.

medical device or system ready for commercialization. This business model allows our clients to support their

Q: Where does Greatbatch export from Tijuana and how

business growth strategy.

much of the products are sold to the Mexican market? A: We ship parts to the US and some countries in Europe,

Q: What are the projects you have here in Mexico?

like Germany, the UK and Italy. Uruguay was first a customer

A: Our main projects for this year are the transfer

in Latin America. In Asia, we export to Korea, Japan and

processes for our vascular products as well as our Power

China. Basically all of our products are meant for export. It

Solutions product line. We are manufacturing power

is difficult to give an exact number of how many finished

solution batteries into our new location and in this building

products end up returning to Mexico because it depends

we are executing our vascular products transfer. For the

on the customer market strategy. Most of our customers

upcoming years, one of the main projects across Integer is

are public medical device manufacturing companies

completing the integration process after the merger.

and are considered the largest of their categories. For example, 95 percent of the pacemakers, defibrillators and

Cardiovascular products were the main products for Lake

neuro stimulators sold around the world had at least one

Region Medical and Greatbatch has a stronger experience

component manufactured here. For vascular products

developing and manufacturing components for the cardio

we have catheters that are used in traditional procedures

rhythm management market, like defibrillators, pacemakers

and steerable catheters that are minimally invasive for

and

faster recovery.

neuro-stimulation.

We

also

produce

steerable

119


| VIEW FROM THE TOP

PAVING THE WAY FOR A BOOMING MEDICAL DEVICES SECTOR FERNANDO OLIVEROS Vice President of Medtronic Mexico

120

Q: What role is Mexico playing today as a worldwide

A: Mexico is spending only 6.2 percent of GDP on

medical device manufacturing hub?

healthcare and half of that is out of pocket. Despite

A: Mexico has not been playing the role it should until

having a long way to go to improve this figure, I think

now. Considering the size of the Mexican population and

current budgets and expenditure can be optimized to

despite the country being a large manufacturer of medical

deliver treatments more efficiently. Companies need

devices the level of penetration on a national level is still

to collaborate with the government in important areas

small. The market for medical devices is becoming more

such as diabetes and cardiovascular care. We need to

important and represents an opportunity for Medtronic

understand that there is no single actor that could come

to close existing gaps in the commercialization and

up with a solution for this problem alone and this is why

manufacturing process. We will be investing significant

the new message we want to get across after our merger

amounts of money in the next couple of years to enhance

with Covidien is “further together�. It is also crucial to

the role medical devices play in the continuum of care,

understand the role that innovation plays in streamlining

including education, prevention, diagnosis, treatment and

costs in the medium to long term. We need to change our

post-surgery. To contribute to the growth of this segment,

mindset and become more responsible when it comes

we are not only bringing new medical devices to Mexico

to healthcare investment as a combined challenge to do

but also connecting the dots in the care process. In doing

things better. In this way, the market for medical devices

this, Mexico will hold a more strategic position for us in

could double or triple.

Latin America since our target is to double the size of our revenues within three to five years in the country.

Q: How should models such as shared risk and pay for performance be used to optimize budgets in healthcare

Q: What would you say is the main reason for the low

institutions?

penetration of medical devices in Mexico?

A: These models can be quite effective as long as they

A: The cause of the low-penetration level is multifactorial

are implemented in a collaborative way. In the case of

and Mexico is facing an epidemiological transition. In

diabetes, despite representing a significant investment

a period of four decades acute diseases have been

for the government the percentage of people achieving

overtaken by chronic ones and the system has not been

metabolic control is around 5-15 percent, and more can

able to adapt quickly enough to these changes. More

be achieved with the same amount of money but with

education and professionals are needed in the country.

a different approach. The government could certainly increase access and improve control if budgets were

Despite the effort being made by COFEPRIS to improve

optimized. Implementing shared risk models should not

efficiency to increase Mexico’s competitiveness, greater

be seen as a transaction but the parties involved should

integration of the healthcare system is needed to move

analyze existing problems and find solutions together. We

forward. In an ideal situation, Mexico would have just one

are more than open and willing to work with models based

system instead of a fragmented one. Patient education

on per capita expenditure, risk sharing, or guaranteed

and awareness is also an important factor, which until only

results. Integrated solutions also play an important role in

recently has become relevant. People need to take better

optimizing costs. For instance, we help hospitals reduce

care of their health and be taught more about diseases

60-75 percent of the amount of products they need as

such as diabetes, hypertension and others.

we offer integral solutions instead of having different suppliers for a specific procedure. Medtronic is working

Q: To what extent is healthcare considered a priority for

with integrators, which are relatively unique to Mexico

the government and how do recent budget constraints

and have had a positive impact on the system. These

impact the penetration of medical devices?

integrators have already helped to increase efficiency


in public institutions, and we want to work closely with

while being monitored. It is commonplace that when a

them to move one step forward together. Integrators

person has a heart attack a lot of time can pass from the

have a lot of data and information that can be used to

moment the episode begins to the moment the patient

really improve healthcare outcomes in an institution.

receives medical attention. Technology can help reduce times by enabling physicians to know immediately the

Q: How is the Medtronic–Covidien merger capitalizing

patient has had a heart attack and send an ambulance

on both companies’ capabilities?

while preparing everything inside the hospital to treat

A: We are the only medical device company providing full

the patient upon arrival. Just a 40-minute difference in

solutions for the most concerning ailments today such as

such a scenario can be the difference between life and

diabetes, cardiovascular diseases and obesity. Following

death.

the merger, we are now able to offer a complete portfolio for hospitals and healthcare professionals and ultimately

Q: Where do you see Medtronic Mexico in the near future

for patients. This has resulted from the combination of

and how would you like to see the industry progress in

capabilities of both companies. For instance, Covidien

the short term?

had a strong portfolio for obesity surgery and since

A: We are working toward Mexico playing a leading role

many obese patients also have diabetes, Medtronic’s

in Latin America by expanding growth. To achieve this we

expertise in diabetes helps to create an integral solution.

will launch new products and technologies always keeping

Regarding manufacturing, Medtronic has six plants

in mind their economic value and clinical outcomes. We

located in Baja California, Chihuahua and Sonora and

will increase our capabilities to deliver products and

14,000 employees. Both companies are combining

valuable solutions for the public and private sectors, while

their technical competences to become better. This

we continue to expand our manufacturing capabilities,

has resulted in the development of better products in

creating a hub for medical devices in Mexico. We want the

a more efficient way, making Mexico more attractive

medical devices sector to be as strong as automotive and

for exporting. The products manufactured in our plants

aerospace in the country. The country needs to be able

support sales of US$4-5 billion worldwide and we still

to capitalize on today’s opportunities in the segment and

need to work on how to use these capabilities to further

stakeholders need to collaborate to attract investment

grow in Mexico as a great deal of production goes to

and the necessary resources to grow at an accelerated

other countries. We are discussing with COFEPRIS and

pace. More importantly, healthcare should become a

the Ministry of Economy the value these plants represent

priority for the government and a motor for economic

for the country. Manufacturing in Mexico has lower costs

development, driving productivity and competitiveness

than in other countries but we need to find a way to

in the country. It seems the government is heavily focused

benefit the country with these products.

on the O&G and automotive sectors. Nevertheless, there are companies like Medtronic employing 14,000 people

Q: Can you share with us some of Medtronic’s cutting-

in Mexico and representing strong actors in terms of job

edge devices?

creation and investment. I think that more efforts can be

A: We developed a heart rate monitor that is implanted

made to help the government understand the relevance

in the patient’s chest allowing the physician to receive

of this sector.

remote real-time data of the patient’s cardiac rhythm. In my opinion, innovation is only of true value when it helps make operations more efficient and reduce resource waste. IMSS receives millions of people every day, which is a clear sign that something needs to be done to optimize operations and costs. Many patients who come from other cities have to deal with frequent cancellations of medical appointments and suspension of laboratory services, which increases the amount of money spent on patient transport and accommodation. Sometimes these patients come only to be told they are in good health, so a more efficient approach can be taken. Devices like our monitor have the ability to inform physicians about the health status of patients. They are required to visit the hospital only when a problem is detected or suspected, reducing unnecessary costs and allowing patients to keep their normal activities on track

“We will continue to expand our manufacturing capabilities, creating a hub for medical devices in Mexico. We want the medical devices sector to be as strong as automotive and aerospace in the country” Fernando Oliveros, Vice President of Medtronic Mexico

121


| VIEW FROM THE TOP

HELPING PATIENTS HELP THEMSELVES LUIS NIETO Director General of ConvaTec

122

Q: Have you seen any developments in the acquisition

increasingly managed by what is known as integrators.

of medical devices due to regulatory improvements in

They have gained significant power to control what they

Mexico?

sell and how they sell it or integrate it. It is not clear

A: Healthcare expenditure and access to medicine and

how this has impacted access in a positive way. Mexico’s

medical devices are still relevant challenges for Mexico. 2015

economy is certainly stronger than other countries’ in

was a difficult year for the public sector due to an increase

the region, but this is not reflected in usage, access and

in budget control. The approach many companies are taking

benefits for the patients. We keep seeing diseases such as

is to work together and strengthen the bond with end

hypertension and diabetes rising.

users, physicians and nurses. Companies around the world are demanding an accurate estimate of market potential.

Q: What new business models are being developed in the

Executives are struggling locally to get current market value,

industry to adapt to barriers in the healthcare system?

a step before in the chain. No actual information exists and

A: Administrative processes should be easy for customers

“guesstimates” are no longer acceptable. There are different

to operate. Companies should, and most of them are,

alternatives to market valuation, the most viable being an

heavily investing in new technology, effective tools for

entity coordinating a third party to compile information

approaching potential customers and raising awareness.

from as many companies as possible and presenting it in the

Achieving or at least getting close to standard of care levels

form of intelligence. The association grouping multinational

for the diverse therapies offered by innovative companies

innovative device manufacturers (AMID) might be the best

is now possible as the main barrier has been traditionally

entity to conduct this effort, due to the rising importance it

physician and patient awareness. With the correct

is taking in our day to day activities.

approach and use of the available digital platforms, you can truly impact the right audience and based on quality

The distribution channels are changing with little or

content, including clinical evidence, develop patient flow,

no perceived value. Public sales are commonly and

benefits and growth.

OUT-OF-POCKET HEALTH EXPENDITURE (percent of total expenditure on health) OUT-OF-POCKET HEALTH EXPENDITURE (% OF TOTAL EXPENDITURE ON HEALTH) 70 60 50 40 30 20 10 0

1996

1998

2000

2002

2004

2006

2008

2010

2012

India

Portugal

Australia

United States

Mexico

Switzerland

Turkey

Canada

Chile

Brazil

Norway

France

Source: The World Bank

2014


“The government invests 3.2

insurers and the incredibly high and not necessarily

percent of GDP in health and

sector has a great opportunity to improve with benefits

properly prescribed consumption of medicines. The for patients and economic development for the country

due to poor awareness, late

and the industry.

detection of diseases and a

Q: Services subrogation is an increasing trend in the

questionable exercise of the

public sector. To what extent will this affect the way you

public budget (...) coverage is

A: I do not see a lot of subrogation. At current rates, I

a humongous challenge”

amounts of patients to private hospitals. What I think is a

negotiate with buyers? find it impossible for public institutions to send massive possibility is for private companies to build and run public

Luis Nieto, Director General of ConvaTec

hospitals, which might prove successful if supervision and transparency are ensured. We do business with public

Q: Part of ConvaTec’s value proposition is increasing

institutions, integrators, distributors and retailers, as we

quality of life through innovation. How do you measure

continue to create clinical acceptance of our products

quality of life?

among users.

A: One of the ways in which companies measure success is the extent to which patients are able to take care of

Q: What opportunities do you see in participating in

themselves. About 60 percent of our consumers are either

consolidated purchase tenders?

ostomy patients or wound patients, so ConvaTec provides

A: I do not see any benefits in this initiative if product

training and abundant information for them to control

quality and patient differences are not considered. Rather,

their condition. The idea is to create a new situation

we will continue selling to different institutions. Pricing

where the patient is entirely responsible for his condition

of consolidated purchases is an issue since they ask for

and is able to do something about it. By no means are

extremely low prices, yet companies are not open to

they going to stop needing healthcare professionals, but

offering low prices while they are expected to also invest

if they know more about managing their own health their

in innovation and education. Every state’s healthcare

condition will certainly improve. The government invests

system and institution creates an opportunity to invest in

3.2 percent of GDP in health and due to poor awareness,

awareness and channel development.

late detection of diseases and a questionable exercise of the public budget in terms of efficiency and transparency, coverage is a humongous challenge. Three percent of GDP is invested in health privately, which includes less than 10 percent of the population covered by private

This transcription is a written reproduction of an interview with Luis Nieto in his personal capacity as an executive in the medical device industry. The opinions expressed are the author’s own and do not reflect the view of ConvaTec or any of its subsidiaries. This transcription was not subject to the approval of Convatec or any of its subsidiaries.

HEALTH EXPENDITURE, PUBLIC (percent of total expenditure on health) PUBLIC 80 70 60 50 40 30 0

1996

1998

2000

2002

2004

2006

2008

2010

Norway

Canada

Portugal

Chile

France

Australia

Mexico

Brazil

Turkey

Switzerlan

United States

India

Source: The World Bank

2012

2014

123


| VIEW FROM THE TOP

TIJUANA EQUALS ADAPTABILITY AND SUCCESS IN NORTHERN MEXICO EDUARDO SALCEDO Operations Director at Össur

124

Q: What is the importance the Mexican plant has for

Our Mexican plant only manufactures about 15 percent

Össur globally? What percentage of prosthetics does it

of the prosthetics but strategically this plant is the most

manufacture?

important as it is close to the US market, which is one of

A: Our central offices are located in Iceland but we are

our biggest.

present with corporate offices in the US. The head of the Americas division is located in Foothill Ranch, California.

Q: What makes you different from your competitors?

Tijuana is the only manufacturing plant in Mexico and

A: Our products are custom made, that is the main

it has shown the most growth in the past year because

difference. We are also willing to invest the highest

it continues to evolve both in size and complexity. It

level of technology in local operations. Many people still

was founded in September 2010 and began with small

use Mexico for low-tech operations, but our corporate

operations focused on molding and plastic injection. In

headquarters leverages the Mexican workforce’s abilities

six years it has grown from 40 employees to over 450

for higher technology, products with higher margins. We

employees. The number of diverse technologies we

shifted operations to Tijuana to keep costs down as our

offer has also increased as we now offer radiofrequency,

competitors manufacture mostly in Europe and a little in

ultrasonic welding, solvent bonding, stamping presses,

the US.

pad printing, metal cutting by waterjet and carbon fiber processing. We have one of the broadest ranges of

Q: Do you work with the government and universities to

technological capabilities under one roof in Tijuana. We

ensure you have human talent here in Össur?

specialize in orthopedics and active functional prosthetics

A: We are trying to strengthen our links with local

and we are the only plant that produces these types of

universities. We want to invest in trade schools, putting

components in Baja California. DGS, a high level division

German/Japanese technology and equipment’s into

that shares ownership with Össur, also operates in our

schools and universities in Tijuana to develop our future

plant and in less than a year they have gone from 11

engineers and technicians. We believe deeply in being in

employees to 150. They produce 300 units per day, which

contact with the community as tomorrow we will be hiring

are different types of active hearing aids.

those human resources. This week we will be developing our strategic plan for the coming fiscal year. We hope

Our Mexico operation has teams capable of managing

to work with universities to design curricula with our

cutting edge technology. We are successfully operating

needs in mind. This means a generation of engineers will

in Tijuana with state-of-the-art machinery, processing

graduate with the know-how the local industry needs.

titanium-based components with the most stringent level

This is a win-win for both companies and students.

of tolerances, products and components that at one point would only be manufactured in our home base in Iceland

Q: What do you hope to gain from the acquisition of

but nowadays manufacturing is migrating toward Tijuana.

TouchBionics in terms of technology and market share? A: We recently acquired TouchBionics, a company that

“The fact that we live longer, are

manufactures upper body prosthetics, as we want to

active to a more advanced age

functioning of the human body. Our products are non-

and the rise of extreme sports

advance into this field. What Össur does is replicate the invasive and aim to restore our patients to a normal life, so people can run and climb stairs again. TouchBionics

contribute to a growing market”

developed an interface linking the neural system and

Eduardo Salcedo, Mexico Site Director at Össur

prosthetic will be controlled by the brain like a human

mechanical components of a prosthetic, meaning the


limb. Once the acquisition is complete, we will add their specialties to ours. This acquisition will put our company in its next technological level. The new technology opens more doors for a product already mechanically and functionally good, seamlessly integrating those products on to the human body is the future of the industry and its true contribution to Össur. Q: What other innovative products do you produce? A: We make high-end hearing aids. In a nutshell, the audiologist injects a rubber compound into the ear of a patient, it solidifies, performs a 3D scan, sends the digital file here to us in Tijuana and then 3D printers generate 125

the model in plaster designed precisely for each person’s individual ear. We produce 300 of these biometric hearing aids daily. Each employee here in Tijuana is trained for three to six months to manually piece together the components of this model. Once they can piece it together with a microscope, we initiate functional tests of the apparatus to detect if there is any feedback. If so, we need to adjust the components by micrometers so the patient can hear with no echoes or other noises. We are talking about linking these hearing aids to smartphones via Bluetooth. Our new generation of products will include this feature and will link to any household electronics with

Q: What are your expansion plans in Mexico?

Bluetooth. Typically, a hearing aid user must face their

A: For the moment we plan to stay in Tijuana due to its

interlocutor or the sound they wish to hear. No more.

ideal location. Corporate America for Össur and R&D is an

Our technology will scan the room, identify the walls and

hour away. Being close to our R&D center of excellence is

distances, and the user will be able to hear speakers to the

key for the design engineers to be in contact with those

side and behind them.

that will manufacture their products.

Q: Who are the main consumers of your products?

More broadly, another competitive advantage is that when

A: Diabetes causes 2 million people a year to lose a limb.

comparing labor costs in China and Mexico, all points to

There are of course amputees from the military and

Mexico. It is most interesting when asked: why Tijuana

accidents happen but our main market is diabetes. We

specifically? From a strategic point of view, and from a

also manufacture braces and soft goods to support other

labor force point of view, I can tell you that Guanajuato

joints in the body. Extreme sports impact the human

and Nuevo Leon for instance have experts in textile,

body in stressful ways that were unheard of 20 years ago

Guadalajara and Queretaro have automobile experts but

and we need to manufacture preventive equipment. For

the people of Tijuana are experts in an impressive broad

example, a 70-year-old playing tennis will wear one of our

range of industries, including electronics, aerospace, food

braces to prevent an injury. That we live longer, are active

processing and medical devices.

to a more advanced age and the rise of extreme sports contribute to a growing market.

The Tijuana workforce has been exposed to working in all of these industries. Besides that, the diversity of

Q: Will future growth be organic or inorganic?

international corporate offices in the city is second to

A: It has been both so far and our strategy remains the

none worldwide. The working people in Tijuana have

same. We want to grow organically but we continue to

developed a trait that you cannot buy with money. That

be on the lookout for potential acquisitions related to our

trait is “adaptability”.

products or which could complement them. Inorganic growth such as the acquisition of TouchBionics can be

Our strategy for 2017 revolves around three concepts:

extremely significant in terms of long-term strategy.

innovation, efficiency and growth. Tijuana encompasses

There is also much potential for organic growth in Mexico.

all three because of its demonstrated capabilities.

We are seeing increasing technology levels and volumes

Technological proficiency is no longer a question mark

of production in Mexico.

when it comes to Mexico.


| VIEW FROM THE TOP

ADVANTAGES OF NEARSHORING FOR MEDICAL TECHNOLOGY MATT JORDAN Vice President and General Manager of Providien

126

Q: Why is a presence in Mexico important for you? A:

Providien

provides

contract

engineering

confidentiality

is

paramount.

That

said,

we

have

and

partnerships with leading medical device companies in

manufacturing services to many of the top medical

the world and focus on providing class II & III devices. Our

device companies in the world. A presence in Mexico

product portfolio is diverse, ranging from cardiovascular

is important to us and our customers for a number of

and orthopedics to women’s health.

reasons. First and foremost, because Mexico offers skilled labor at a reduced and competitive rate.

Q: What are the advantages of uniting all Providien

Manufacturing wages in Tijuana are globally competitive

subsidiaries under the Providien banner?

and as a result Tijuana is one of the largest medical

A: Providien has been operating as one organization for

device manufacturing cities in the world. Second, the

several years, so tactically nothing has changed. The

in-country local supply base is more sophisticated

advantage of operating under one unified corporate

than that of other low-cost regions. For example, in

banner is that we can better market our complete value

the Dominican Republic, Asia and other emerging

offering. Providien consists of four primary business units

geographies, manufacturing companies need to import

focused on plastics, metals, thermoforming and device

commodities and other specialized materials, which

assembly, but they all work together to provide solutions

drives up cost. In Mexico, those same commodities may

in the medical device industry. For example, recently

be stationed and warehoused only a few minutes away.

one of our customers developed a strategic objective to

Third, in relation to the US, Mexico is considered “near-

reduce costs by a significant percentage. Providien has

shore”. Providien can build cost competitive products in

subsequently made sizeable capital investments in two

Mexico, and have the goods imported and distributed

different business units and has provided that customer

across the US in a matter of days. If building in Asia, that

with annual cost savings in excess of 1 million dollars per

same lead time extends into weeks and months.

year. We were able to achieve that success by operating as one organization to provide a powerful solution.

“It’s a priority to leverage all of its US supply offerings

Q: To whom do you supply in Mexico and what are the most demanded products? A: In addition to the leading medical devices companies,

and consolidate in Mexico

we also supply to tier two and tier three Original

to deliver an economical

three require a slightly different solution, one that has

solution. Mexico is a favorable

Equipment

Manufacturers

(OEMs).

Tiers

two

and

more of an emphasis on engineering and Design for Manufacturing (DFM). At Providien, we have a team of

geography with regards to an

seasoned engineers who not only help improve complex

organization’s ability to scale”

as the products of high demand, there are generally two

Matt Jordan, Vice President and General

manufacturing processes but also develop them. As far types. High-volume disposables and/or products that require a high degree of manufacturing labor.

Manager of Providien Q: What partnerships and alliances do you have in Q: Who do you provide your products to?

place in Mexico?

A: We are exposed to and work with valuable intellectual

A: We have formed partnerships with many local

property in the medical industry. As a result, customer

suppliers in Mexico. These relationships have extended


into the US and into our California divisions. We also

government and we provide employees with food and

partner with a Mexican logistics company called JD

gift certificates. Providien now offers formal education

Group. They have been fantastic to work with. JD Group

to engineers and sponsors them through technical

is the only logistics company that has both US and

certifications.

Mexican customs brokers, which allows Providien to move product in and out of Mexico very quickly.

Providien has emerged as the preferred outsourcing partner in the medical device manufacturing industry

Q: What are your strategic priorities here in Mexico?

in Mexico. With continued growth forecasted, 2016

A: Expansion. As cost pressures continue to mount, the

and 2017 will be very important years for Providien. In

demand for cost competitive manufacturing increases.

Mexico, our growth is specific to Tijuana.

Strategically for Providien, it’s a priority to leverage all of its US supply offerings and consolidate in Mexico to

Moving to another country in Latin America would

deliver an economical solution. Mexico is a favorable

mean forfeiting some of the advantages mentioned

geography with regards to an organization’s ability

earlier. Providien always looks to add new customers but

to scale. The supply and demand ratio for labor is

organic growth with our existing partners is a strategic

such that adding labor can quickly be accomplished.

objective.

Having reduced costs and the ability to quickly ramp up operations this close to the United States makes

Q: How do you maintain your competitive edge in the

expansion in Mexico a strategic priority.

medical device manufacturing market? A: Commercially, we maintain a competitive edge by

Q: What has been the impact of the growth of the

utilizing all of our business units and providing vertically

medical devices market on your operations?

integrated solutions. Internally, we excel operationally

A: The impact has been sizable and our business has

and focus on continuous improvement. We strive for

grown. One of the top priorities has been to give back

continuous improvement not just in manufacturing,

to the labor workforce here in Mexico. We’ve invested

but in all areas of the organization ranging from human

in improving the employee work experience in Tijuana

resources to logistics. We understand that our people

and offer upgraded facilities and an increased number

and our teams make us great. We have an impressive

of local recognition events. We partner with the local

team in Mexico and I am proud of our operation.

127


| VIEW FROM THE TOP

MEDICAL TECHNOLOGY COLLABORATION ACROSS THE PACIFIC KOTA YAMAMURA President of Terumo

128

Q: How has the medical devices market evolved since

by our mission, we are not just providing high-quality

Terumo’s foundation in Mexico?

products but we are contributing to society.

A: We have a more than 20-year history in Mexico, since we established a regional office in 1992. Initially we

Q: How do you collaborate with the government to

focused on syringes, needles and disposable products

contribute to the growth of this sector?

but over the last 10 years the axis of the company has

A: As mentioned before, we have training programs,

changed and now we have another pillar, the cardiology

most of them on the cardiology field and supported

field. Our main priority has been to provide a high-quality

by the government. We have sent doctors to receive

portfolio of products so we can improve the patients

specialized cardiovascular training in Japan. In the same

quality of life. At the same time, our products are easy

way, these Mexican doctors share their experiences with

to use by doctors and medical staff, which has influenced

their Japanese colleagues, enriching the experience

both in society and in how medical procedures are carried

for both parties. Sophisticated techniques are covered

out in the country.

during the trainings and a few months later the Japanese doctor that trained them comes to Mexico to evaluate the

Terumo has a presence in more than 160 countries. We

effectiveness of the training and to get to know Mexican

support our customers with global clinical evidence

medical practices. These trainings have been performed

that backs up the quality of our products and their use

for five years and still there is a lot of room for growth, for

in different medical fields to obtain the desired clinical

example with trainings for nurses and engineers.

outcomes. We are also providing international training in different areas that concern the users of our devices.

Q: Some executives in the medical devices industry have

Together, the international experience and our training

expressed that COFEPRIS could further reduce approval

programs provide the doctors and medical staff with the

times. What are your thoughts on this?

strongest support. This is the best way to capitalize on

A: COFEPRIS has improved in recent years. As a member

good practices that Terumo has acquired over the years.

of the Japanese Chamber, I am in charge of supporting Japanese companies in sorting out regulatory issues

Q: What would be the main difficulties faced in terms

with COFEPRIS and I can say the Commission is open to

of Mexico’s medical devices industry and how do you

collaborate and provide positive answers. For example,

overcome these?

in 2012 Japan and Mexico signed a fast track agreement

A: Mexico and Japan have a similar population around

for medical devices, which has allowed acceleration of

125 million people, but the number of medical cases is

the approval of Japanese medical devices, including our

not the same as Japan. It means Mexico has a strong

devices.

potential to increase the access to medical treatments from different specialties. Added to this, the country´s

Q: What are your main objectives for this year?

economic growth will certainly lead to a greater

A: Innovation is not moving at the same pace today as

demand for healthcare services. Thinking on this we

10 years ago, when many new products and technologies

have already performed several trainings for doctors in

were developed. Nowadays we are focusing on developing

the Interventional Cardiology field to offer a different

new easy-to-use and safe products with an added value.

treatment approach that allows reducing the time

Training is also extremely important for us and we see it as

a patient needs to stay in the hospital. By reducing

a contribution to improve the healthcare sector in Mexico.

hospitalization time, expenses are directly reduced

Collaborating more closely with doctors is also at the core

too. Both the Japanese and Mexican governments have

of our strategy, as their opinions are a valuable source of

supported these training programs and as dictated

input for the improvement of our products.


| INSIGHT

PRODUCT REGISTRATION IN MEXICO GETS STREAMLINED When international companies decide to enter the Mexican market, they are extremely enthusiastic to take advantage of the many opportunities it offers. However, they either perceive the regulatory framework as a complicated

LUISA GUTIÉRREZ

barrier or are unaware that they need to plan a strategy

Director General of Medisi

to effectively register their products in Mexico. Despite offering high-quality services, international consulting firms usually lack local knowledge and this is where

backlog on reviewing submissions, which is partly

Medisi becomes relevant since it supports international

because they never deny an authorization without asking

companies

to

for further information first,” Gutiérrez says. She also

regulatory affairs to achieve commercial goals. For

considers that COFEPRIS needs to optimize a regulation

instance, as new product registrations can take up to a

for

year and a half, companies can spend 12 months putting

understand medical devices as it is a universe of diverse

a dossier together. This is not encouraging for medical

products. Wound care materials are completely different

devices companies willing to launch new versions of their

from medical equipment such as a laser treatment for

equipment every year, which is why product registrations

cancer. In my opinion, we are moving toward a more

in Mexico should be planned strategically.

accurate classification for medical devices.”

Companies interested in entering the Mexican market

The classification according to risk has I, Ia, II, and III

should be correctly advised to avoid a path full of

categories requiring different legal documents. Classes I,

obstacles

in

developing

a

strategic

approach

medical

devices.

“COFEPRIS

needs

to

better

are

II and III take between three to seven months to obtain a

usually seen as mere requirements to be met,” says

registration with COFEPRIS plus the time it takes to prepare

Luisa Gutiérrez, Director General of Medisi. “When in

the dossier, while it takes between 2.5 and six months to

reality, regulatory affairs strategies have a tremendous

get a registration through a third party authorized unit.

impact on the commercial success of a product.”

Medisi help its clients get a dossier in four months, so the

Some companies need to register 10 products in a row

whole registration process is completed within a year.

and

disappointment.

“Regulations

while others 35. A common mistake is undergoing an individual submission process for each of the products

For Gutiérrez, the opportunity for medical devices

when they could strategically group them according

companies is huge. Mexico’s total population is about

to their manufacturing and core features. As Gutiérrez

128 million inhabitants. Launching a product targeting 2

says, medical devices companies need to be aware that

million people in Mexico equals covering one-third the

product registrations in Mexico can take from 17 to 25

population of Israel. However, registration processes can

months, and Medisi can do it in 7 1/2-13 1/2 months due

be convoluted for international companies when they

to their efficient submissions and follow-up. “We have a

do not have the knowledge in negotiating the arena.

project management tool that is useful for determining

“They usually believe that contacting a local partner or

milestones, timescales and the workload,” she adds. “If

a distributor will solve all their problems,” Gutiérrez says.

something gets delayed by COFEPRIS, we will notify our

“On the other hand, many other companies have realized

client and develop a plan to decide the most appropriate

that it is worth having their own registrations in Mexico and

way to optimize time to market.”

they are striving to expand their portfolio in the country.”

Regulatory timelines in Mexico have become quite

Medisi employs 25 people including quality assurance,

competitive around the world due to vast improvements

regulatory affairs and business development experts.

made by COFEPRIS in the last three years. Nonetheless,

It is now focusing on providing training to companies

there are still some challenges such as regulatory offices

so they understand Mexico’s regulatory framework and

providing bilingual services to companies outside Mexico.

realize there is always a strategy to easily obtain product

Also, as many distributors and companies ignore the

registrations. “We are also aiming to expand to places

requirements to submit a dossier, regulatory agents

with a similar environment to Mexico. We are interested in

spend more time than they should reviewing incorrect

building strategic alliances in Latin America – a region with

submissions. “Historically, COFEPRIS has had a huge

great potential yet to be unlocked.”

129


| VIEW FROM THE TOP

TIJUANA A GROWING HEALTH TECHNOLOGY HUB

130

Cristina Hermosillo President of Cluster Tijuana EDC

Ă ngel de la Campa President of Cluster Tijuana EDC at Medical Devices Cluster

Miguel FĂŠlix President of Cluster Tijuana EDC at Medical Devices Cluster

Q: What are the tendencies in the medical devices sector

AC: Baja California represents 50 percent of the medical

and what future tendencies will we see?

devices industry in terms of plants and 25 percent in terms

AC: I think we will see a tendency for more personalized

of employees.

devices with a high degree of integration with electronic devices. For example we will see apps that give patients

Q: What are the cluster’s strategic priorities?

easier control of devices and will enable monitoring of

MF: We have updated our strategic plan. We used to

the patient and sending out alerts. This is a world trend.

have seven lines, which we have reduced to five: human

We have heart valves that no longer require weeks of

capital development, supplier development, promotion

recovery but only 24 hours. We have catheters that enable

of the sector, government relations, R&D. We have had

the doctor to enter the blocked artery and use digital

successes in all.

technology to check both ends of the artery, find the clot and remove it. We help manufacture the latest products

Q: Why is Tijuana attractive to foreign companies? What

that are being thought up and designed in R&D centers

facilities are there?

and head offices.

AC: We have people with over 25 years of experience that are bilingual, who know the culture of both the US and

CH: Companies are getting bigger and there is world

Mexico. We have access to the international airports of

pressure to lower the cost of commodities. This is usually

Tijuana and San Diego, we have an international port so we

the first outreach we have with companies. They begin

can import and export and Long Beach port is not far either.

by making simple products and move toward more

From a logistics point of view, we have access to all means

complex operations. There are companies like Foxton who

of transport. We have world class facilities and universities

traditionally make electronics and are looking to move into

that can give us calibration systems we need and we have

medical devices, or Thermalfusion, who are moving toward

support from the government. Unlike other industries, we

big data and analytics and medical device software.

are not content with 99 percent quality because in medical terms that means one in every 100 patients dies, which is

MF: We have been in the industry for 30 years. In contrast

not good enough for us. We have been successfully audited

to other industries we do not receive obsolete technology

by the FDA many times.

but the latest and newest advances in the field. We are participating in the design of devices from a manufacturing

Q: To what extent do you believe you will grow?

point of view.

MF: There are many medical devices opportunities in Nordic countries. They are trying to enter the US market and Tijuana

Q: What percentage of the cluster does medical devices

is an ideal place to start. Other countries such as the Czech

represent? How important is it for you?

Republic have companies looking to move here. Mexico has

MF: In Tijuana, there are almost 580 manufacturing

important commercial power in terms of certifications and

companies, 44 of which belong to the medical devices

trade agreements. We also have R&D, which is the message

sector, which is 7.5 percent. In terms of employees, we

we are taking to international embassies.

employ 42,000 of approximately 200,000 people. AC: In the medical sector, Mexico will grow the most, even CH: In 2015, medical devices represented 10 percent of

compared to Italy, Germany, the UK, the US and Japan. We

investment in Baja California and 25 percent for Tijuana.

project to grow between 7 and 10 percent.


| INSIGHT

REGISTRY PLUS CERTIFICATION A WINNING FORMULA Third party authorized centers are invaluable to COFEPRIS when it comes to product evaluation for sanitary registration. With 20 years of experience as a certification and inspection body for electric and electronic devices,

CARLOS PÉREZ

and with official branches in countries such as China

Director General of NYCE

and Colombia, NYCE decided to tap into the Mexican pharmaceutical and medical device sector as soon as the government authorized third parties. NYCE is one of the 19

650 medical devices so far we are the third largest in the

third party centers but the only one offering the possibility

market according to COFEPRIS,” says Pérez. The market is

to obtain product registrations along with certifications

dynamic and based on price so companies should focus on

that comply with international standards. “This has helped

offering a better customer experience. According to Pérez,

us develop both technical and professional capabilities,

a recent market study showed that price is not the only

which are indeed very difficult to replicate,” says Carlos

element defining customer preference. Clients are seeking

Pérez, Director General of NYCE.

high quality-services, active support from their partners and experienced customer service. Equipment certification

Global standards represent a major trend and all industries

should not be viewed as a tool to simply gain access to a

are moving toward homogeneity. Standardization makes

market but to provide customers and end consumers with

it easy for companies to expand. NYCE is a certification

safe and efficient equipment.

and standardization body capable of implementing international canons for electronics, telecommunications,

NYCE will continue expanding its capabilities to several

IT and more recently, healthcare devices. In Mexico, there

areas outside of electronic and medical devices. In the

are 11 standardization entities and NYCE is one of the

next few months it will cover herbal medicines and

larger ones. It also offers validation services in the form

COFEPRIS will release the bid for pesticides, plaguicides

of conformity assessment, as regulatory requirements are

and fertilizers. “We are training our staff in these fields and

not considered standards but specifications to comply.

we will approach chemical companies to offer third party

It decided to establish operations in China because

evaluations for their products,” says Pérez. NYCE wants

65 percent of electronics consumed in the world are

to become accredited in conducting good manufacturing

manufactured there and they need to comply with local

practices audits in pharmaceutical plants since it believes

regulations and official norms to enter the Mexican

that ensuring quality manufacturing will help get products

market. Having a representation of its services near the

registered quicker. At this point, audits in medical devices

manufacturers was a significant move for NYCE and it now

plants are attractive as most of the production is exported

holds a recognition agreement with a Chinese laboratory

and would not impact product registrations in Mexico.

to ensure product compliance according to Mexican

Nevertheless, quality certifications should definitely be

requirements. This helps manufacturers avoid logistics

recognized in destination countries. “As COFEPRIS gains

expenses associated with sending products for evaluation

international recognition we expect Mexican registrations

and makes their entry easier.

and norms to be valid around the world,” says Pérez. “Our activities and efforts will certainly impact more countries in

“Regarding medical devices the largest producers are

the short to medium term.”

European and American companies, therefore we contact them to offer a package including product registration with COFEPRIS and certification for electronic devices,” says Pérez. Most third parties in the healthcare industry do not certify electronics and this is one of NYCE’s main differentiators. Unlike other third party entities, NYCE is directly involved with several industries. NYCE’s multi-

“As COFEPRIS gains international recognition, we expect Mexican registrations

sectorial experience is a great competitive advantage.

and norms to be valid around

“Today we have 8 percent of the healthcare Industry

the world”

third party units’ market share and having evaluated

Carlos Pérez, Director General of NYCE

131


| EXPERT INSIGHT

COMPLIANCE KEY TO ENTER DEVICES MARKET then to the US and to Mexico for the sole reason that the regulatory environment is more predictable.

RUBÉN GAITÁN Design Development Manager

Q: Here in Mexico, to what extent do you gauge market

of Alandra Medical

suitability when deciding whether to commercialize a product? A: In Mexico, our main product is consultancy services for

132

Q: What can you tell us about the company’s history and

other startups. We have also worked with the Mexican army

how it made the decision to come to the Mexican market?

to help them with a medical device they are developing

A: Alandra Medical was created after merging the best

with Monterrey’s ITESM and other entrepreneurs. In Mexico

intellectual property (IP) portfolios from two Mexican

we are not marketing any device because at the end of

medical devices companies, Innovamédica and HOLOS,

the day, Alandra is most interested in taking ideas from

with Gerbera Capital, which is a Mexican venture capital

academia, building up a portfolio and then transferring

firm that was interested in developing medical devices

these ideas to large companies like GE. Of course the

for the healthcare industry. Since six years ago, we have

IP is important but in the industry it is also necessary

undergone a great deal of change. The first step was to try

to demonstrate compliance to industry standards and

to outsource services and devices from US companies like

clinical evidence that the device works and that it is safe.

Medtronic or Boston Scientific. We discovered that Mexico

Many entrepreneurs in Mexico believe that trials can be

manufactures medical devices but there is a long way to go

performed on humans having only received approval

regarding the expertise and regulatory discipline needed

from the institute’s ethical committee, but approval is also

to sell product development services. We have customers

needed from COFEPRIS.

from Johns Hopkins University and from the University of California and it was mostly these types of academic

Q: To what extent do you believe that work is needed in

customers who proved a strong match for Alandra Medical.

establishing a more comprehensive system for regulating medical devices?

Alandra has its own medical technology that it has

A: I would say it depends on the environment. There are

acquired from other companies. We have benefited from

major clusters in Chihuahua, and in the northern area of

several grants from the National Council for Science and

Mexico there are serious companies that build devices

Technology (CONACYT) and the entrepreneurship institute

to standard. I believe there is a lot of work to do in the

INADEM, which helped us develop internal capabilities

entrepreneurial environment. There is an aim within the

and an internal quality control system. The company is

Ministry of Economy to develop the Mexican software

certified to ISO 13485. We spun off another company in

industry to a similar or superior standard to India. We have

California called Critical Perfusion to market and launch our

an advantage in that we are neighbors with the US. There

first medical device, which is a monitor for surveilling the

is support from the Ministry of Economy, we have an ideal

perfusion status of the gastric mucosa. We also contributed

geopolitical relationship with the US and it is something we

to developing a therapy system for diabetic patients who

can leverage through the development of the industry in

have injuries that are very slow to heal. This technology

the coming years.

helps to heal them through the application of certain magnetic fields.

Our main goal is to obtain clearance to market our device in Europe, which will lower the perceived risk of investing

We

other

in our company. Many companies are relatively afraid

entrepreneurs but our system relies on developing products

also

carry

out

outsourcing

projects

for

to develop products and seek startups that struggle to

with regulatory and quality control norms. Of course,

get clearance and only once obtained will they invest.

Alandra makes money from involvement in operations

Regulatory clearance for innovative high-risk devices

but even today we are still dependent on the contribution

created by entrepreneurial developers has declined over

that Gerbera Capital is making. It has taken us six years to

the past few years because of the substantial investment

develop the product to this point, which is relatively quick

that such innovations require and startups face a major

given that similar companies in the US and in Europe take

financial burden. Alandra Medical has identified that we

up to ten years. We are thinking about going to Europe first

need clearance to attract more investment.


| VIEW FROM THE TOP

CATALAN TECHNOLOGY EXPERTISE HELPING MEXICAN PATIENTS LOURDES CAMP General Manager of Ventura Medical Technologies

Q: What are the unique characteristics of the products

A: Registration processes vary widely in length. If there is

Ventura Medical Technologies is bringing to the Mexican

already a similar product in the market registration only

market?

takes seven months. One of a kind, innovative products

A: We are entering the Mexican market with our new

have to undergo clinical trials before approval. We still do

thoracic implant, the Pectus Up Surgery Kit, designed to

not know how many patients will be required for the trials

treat a congenital malformation called pectus excavatum,

and its registration will influence how fast we can perform

and my goal is to register it to begin commercialization. We

them. It would be significantly faster to perform them

have already spoken to thousands of doctors and have good

with two than with 50. Yet, we have enough candidates

expectations from governmental offices, including PEMEX,

both in doctors and hospitals, to perform these trials in

SEDENA, ISSSTE and IMSS. We have great expectations for

one or two months. Taking into account the time cost of

this last institution as its head of innovation used to work for

clinical trials, we expect to have the product approved

Ventura Medical Technologies in Barcelona, Spain. For that

in a year.

reason, we expect to perform some clinical trials both with IMSS and ISSSTE.

Q: What are your expectations for the Mexican market and how do you expect doctors to receive the product?

Q: What led Ventura Medical Technologies into Mexico

A: We have great expectations for this product and I am

and what is the company’s proposition for the Mexican

certain that we will have a significant number of sales

market?

as soon as we acquire the registration. We have many

A: Ventura Medical Technologies is an engineering

potential clients both in the public and the private sector.

company which prides itself on its close relationships with

Most doctors are pleasantly surprised by this product as

doctors and allows them to turn their most innovative ideas

it is minimally invasive in comparison to other techniques,

into products, which are marketed through our global

some of which even cause small mortality rates. As the

distribution network. We are devoting ourselves to health

product is minimally invasive, its indirect costs are greatly

and the development of new medical devices, promoting

reduced which is attractive to public health institutions.

innovation among health professionals and helping them get their products to the market. Normally we offer expert advice and look for synergies between their innovative capabilities and our own expertise. The company is based in Spain but the product is patented in 18 countries, including Mexico. I am developing a commercial strategy for the country using both my experience as a doctor and my large network both with the public and the private healthcare sector. We gained interest in the country from the great enthusiasm I saw from Mexican doctors I met at international healthcare events. I have also had close relationships with many potential clients in the country who seemed greatly interested in the product, so bringing it into Mexico seemed a logical next step. Q: What are the main challenges Ventura Medical Technologies has had to overcome to commercialize its products in Mexico?

Pectus excavatum or funnel chest is a congenital deformity in which several ribs and the sternum grow abnormally, producing a concave appearance in the chest wall

133



6

DIAGNOSTICS & PREVENTION

Under pressure to reduce costs and improve efficiency on a shrinking budget, the push is under way in Mexico to promote a culture of prevention in view of a growing epidemic of obesity and related illnesses like diabetes, hypertension and glaucoma. While the public sector is leading the charge with information campaigns, companies and NGOs are also getting on board with their own projects to improve the country’s health and reduce the debilitating effects of these conditions.

Life-threatening illnesses like cancer are being observed and studied to improve detection and prevention strategies, with a focus on genetic predisposition and long-term strategies such as INCan’s Tumor Bank, which keeps tissue samples for later research. Among institutional efforts, companies are also working to create modern tools and develop digital systems to help stop sickness in its tracks. This chapter showcases some of the organizations and firms at the forefront of the prevention and diagnosis battle in Latin America’s second-largest economy.

135



| CHAPTER 6: DIAGNOSTICS & PREVENTION 138

ANALYSIS: Companies and institutions leading the diagnostics charge

140

VIEW FROM THE TOP: Luz Ruíz, INCan’s Tumor Bank Coordinator

Abelardo Meneses, Instituto Nacional de Cancerología

142

VIEW FROM THE TOP: Erick Alexanderson, Mexican Cardiology Society

143

VIEW FROM THE TOP: Carlos Sánchez, MyHeart

Óscar Sánchez, MyHeart

144

EXPERT INSIGHT: Eduardo Lazcano, National Institute for Public Health

146

VIEW FROM THE TOP: Frank Admant, BioMérieux

148

ANALYSIS: Vaccination Culture Prevalent in Mexico

149

VIEW FROM THE TOP: Juan Tamayo, COMOP

150

VIEW FROM THE TOP: Carlos Hernández, Siemens Healthineers

151

VIEW FROM THE TOP: Jorge Soto, Miroculus

137


| ANALYSIS

COMPANIES AND INSTITUTIONS LEADING THE DIAGNOSTICS CHARGE From outlining long-term plans against life-threatening

including regular medical check-ups will go a long way.

illnesses like cancer to coming up with new and improved

“People should be making lifestyle changes that lead to

technology for early detection and prevention, Mexico is

lower cholesterol levels, reducing tobacco consumption,

increasing its focus on preventive medicine. Organizations

increasing physical activity, achieving a healthy weight … to

like the National Institute of Cancerology (INCan) have

reduce the risk of cardiovascular disease,” he says. Women

created initiatives such as the tumor bank to keep a tissue

are also an underdiagnosed demographic, which is why

registry while the country’s main health provider, the

the SMC partnered with the American Heart Association

Mexican Social Security Institute (IMSS), is looking to shift

(AHA) on preventive campaigns.

attitudes toward a healthier lifestyle in the face of severe 138

overweight and obesity ratings threatening epidemics on

Hard science is also needed to create reliable indicators,

diseases such as diabetes and heart disease.

an area where INCan is working non-stop via collaboration with state health providers like Seguro Popular, but the

The importance of prevention is impossible to overstate,

country is still a few years away from having all the data in

as preventable or treatable diseases such as heart disease,

hand. However, advances such as testing family members

diabetes and cancer account for almost half of Mexico’s

of cancer patients for genetic markers predisposing them

deaths. In 2014 heart conditions including myocardial

to the disease have shown promising results, say doctors

infarction were the main killer in Mexico, with over 19

Abelardo Meneses and Luz Ruíz, from the Institute.

percent of deaths, followed by diabetes with 15 percent and malignant tumors in third place with 12 percent,

Technology firms like Siemens Healthineers are teaming

according to official data.

up with diagnostics laboratories on strategies and digital solutions to reduce diagnostic costs and time, also looking

Against this stark background, Mexican and international

to help in a time of financial pressures brought about by

companies are leading efforts on early detection and

governmental budget cuts. “By detecting predispositions,

prevention

potentially

laboratory diagnostics can improve disease prevention

debilitating conditions such as osteoporosis, setting their

and will become more important, reducing cost of care

sights on a stronger and healthier population.

with higher possibilities of success,” says the company’s

for

those

illnesses

but

also

Hispanic America Regional Director for their Diagnostics For some such as Doctor Erick Alexanderson of the

Division, Carlos Hernández.

Mexican Cardiology Society (SMC), simple measures Financial constraints are on everybody’s mind, as state health providers spend most of their resources treating

MEXICO’S DEADLIEST DISEASES Heart disease

121,427

conditions related to diabetes and obesity, according to the

Diabetes mellitus

94,029

Director General of IMSS, Mikel Arriola. Miroculus is looking

Malignant tumors

77,091

into the growing field of molecular research to offer simple

34,444

to use diagnostics tools for stomach cancer and is aiming to

33,166

start clinical testing in Mexico by the end of the year, while

Liver diseases Cerebro-vascular conditions Influenza & pneumonia Chronic pulmonary diseases

20,550

Osteosol is working to stop osteoporosis from the womb.

19,715

Perinatal conditions

13,089

Vaccinations, one of the main areas of traditional

Kidney failure

12,788

preventive medicine, looks like a bright spot, as the

Congenital malformations and anomalies

9,569

country ranks high in children’s inoculation levels in the

Malnutrition

7,300

OECD, even surpassing first-world nations like France

Chronic bronchitis

5,060

and the US. And Mexico’s National Public Health Institute

4,811

(INSP) is also looking at adults and conducting trials to

Septicemia

3,805

improve vaccination rates against Human Papilloma Virus

Anemia

3,640

(HPV), a leading cause of cervical cancer in the country.

Infectious Instestinal diseases

3,449

HIV-related diseases

Non-categorized causes Total Deaths, 2014 Source: INEGI

10,583

This chapter takes a look at both companies and

633,641

institutions fighting to stop the spread of diseases before they hurt Mexicans.


139


| VIEW FROM THE TOP

A LONG BUT AMBITIOUS ROAD TO PREVENTIVE CULTURE Luz Ruíz INCan’s Tumor Bank Coordinator

140

Abelardo Meneses Director General of Instituto Nacional de Cancerología

Q: One of INCan’s objectives is applied research. Where

Q: With Seguro Popular, 36 percent of the population is

are you investing your efforts in this area?

entitled to medical care, including for cancer. How have

A: INCan performs both basic and clinical research. A few

detection indicators increased and what states are the

years ago, we started the practice of translational research

most afflicted?

to benefit patients. It is designed to go from the lab to the

A: Primary and secondary prevention efforts to reduce

hospital bed and research is applied from the prevention to

exposure to risk factors, such as high-calorie diets,

the palliative care stages. Soon we’ll also apply it to cancer

adopting a healthier lifestyle, stopping smoking and

survivors and our goal on the clinical side will be to obtain

exercise, do not happen overnight. Similarly, increasing

molecular and genetic responses and also best practices,

early detection indexes for malignant tumors susceptible

while also gathering patient success stories related to the

to

different treatment protocols and clinical stages.

commitment. Both primary and secondary prevention

early

diagnosis

takes

considerable

time

and

require at least two decades of constant application to We are focusing prevention research on populations

see results in the population.

suffering from hereditary cancers, such as malignant breast, ovarian, endometrial, colon and prostate tumors.

Catastrophic coverage of neoplastic disease within the

Close to 10 percent of patients suffering from these have

Seguro Popular has been available for about 10 years

genetic mutations that aid tumor development. We have

for breast and cervical cancer and for close to five years

centralized genetic studies of the patients’ families for

for testicular, prostate, colon and ovarian cancer and

early detection and diagnoses of the asymptomatic

non-Hodgkin lymphoma. This is too little time to have

relatives carrying the gene mutation that predisposes

measured relevant results.

them to develop one of these tumors. Close to 90 percent of our patients suffer from breast, ovarian or

Of all deaths in Mexico, about 13.7 percent are due

colon cancer and in each of these patient’s families we

to cancer. Every year 190,000 new cancer cases are

have encountered three or four relatives at high risk of

diagnosed and mortality rates are around 60 percent.

developing malignant tumors, known as asymptomatic

The most frequent malignant tumors are breast, prostate,

carriers. We have started a hereditary and family cancer

cervical, colon, lymphoma and lung related. Malignant

clinic to study people at high risk of carrying a genetic

tumors show regional patterns in Mexico’s 32 states

mutation and their relatives to provide them with

depending on sex, age, socioeconomic status, exposure

genetic advice, follow-up and possibly diagnose them

to risk factors and lifestyles.

at an early stage. Generally speaking, there is a higher number of cases Q: What are the needs of the Mexican population and

in the country’s north, with greater incidence of breast,

how can we reduce mortality?

prostate, colon, lung cancer and lymphoma. In the south,

A: Developed countries have reduced the incidence of

we have breast, cervical, gastric and liver cancer, with a

advanced cancer and of certain types of tumors. This

higher mortality because of the advanced stages they are

is not happening in developing countries where cancer

usually diagnosed at and the lesser access to healthcare.

cases and mortality are on the rise. INCan took the lead in developing the Mexico Cancer Prevention and Control

Q: Which preventive measures can Mexicans implement

Program (PIPCCM), an integral part of which is the creation

in their daily lives to reduce the chance of falling victim

of cancer registries that are based on population and

to cancer?

strategically located. It also promotes lifestyle, education

A: There are several things people can and should do to

and awareness to diminish exposure to risk factors.

reduce their chances of catching a chronic, non contagious


disease such as cardiovascular afflictions, diabetes and

We will generate research from the tumor bank INCan

some types of cancer. It is possible to prevent around 40

has developed over the past few years, which has

to 50 percent of malignant tumors if we adopt healthier

preserved over 6,500 fabric samples of different types

lifestyles and remember to do detection studies. There

of tumors and over 9,000 samples of plasma for the

are risk factors heavily linked to cancer, such as tobacco

purpose of researching biomarkers and to use the fabric

intake, high-calorie diets leading to obesity, heavy intake

in collaborative national or international research projects.

of sugary drinks and alcohol, lack of exercise, exposure to

The main objective of the INCan tumor bank is to create

human papilloma virus (HPV) and Hepatitis B and C, high

a platform for oncological research, preserving tumor

exposure to sunlight and UV rays and carcinogens in the

fabric in an optimal condition and when conditions permit,

environment and workplace.

we conserve the fabric of a recurring tumor. Even so, active participants in malignancy projects such as the

Q: What other programs have been put in place to

breast cancer project are most often young women. The

educate the population?

INCan tumor bank is supporting 10 translational medicine

A:

state

and clinical research projects. It also is participating in

governments and members of the chambers of deputies

Together

with

civil

organizations,

some

international projects such as the Regional Center for

and senators, INCan has adopted specific programs for the

Research of Excellence and Non-Transmissible Diseases.

diffusion of knowledge on breast, colon, stomach and lung cancer, as well as leukemia. Through these activities we

Within senior management’s program and with the

seek to disseminate the concept of high-quality care, early

finality of strengthening the culture of prevention, we will

adequate and effective treatment and the enhancement of

continue to undertake activities such as the Cancerton

palliative and rehabilitative care. INCan also has a permanent

and to implement early diagnosis opportunities for the

information program on tumors called Infocáncer.

main tumor types in various Mexican states.

This program has been much consulted and not only

The road is long and ambitious but we want to change

have patients and their families been able to obtain

from being a reactive country to cancer, to a country with

information but so have those who want to learn more on

a preventive culture.

different malignant tumors, their behavior and treatment options. Q: Having a preventive approach not only improves recovery chances of the patient but also has a lesser impact on public spending. What support has INCan received from the Health Minister to promote a preventive culture? A: Fiscal and physical resources are engaged for the year on operation and investment plans. Nonetheless, through special programs INCan staff is able to manage resources for capacitation, diffusion, rehabilitation and research for the prevention and treatment of malignant tumors, specifically for breast, cervical, ovarian and lung cancer, HIV/AIDS and hereditary cancer. INCan also participates in breast and cervical/uterine cancer prevention programs with the Health Ministry. Q: What are INCan’s future projects? A: The National Institute of Cancer will continue to promote prevention programs that encourage lifestyle changes and the empowerment of cancer survivors to change the perception that cancer equals death and replace it with success stories. We will also promote the “Integral Program to Prevent and Control Cancer in Mexico” and develop three more population-based cancer registries in Guadalajara, Monterrey and Puebla, in addition to the existing one in Merida.

141


| VIEW FROM THE TOP

NETWORKING HELPS TAP INTO CARDIO SOCIETY ERICK ALEXANDERSON President of the Mexican Cardiology Society (SMC)

142

Q: What resulted in the creation of the Mexican

agreements

Cardiology Society and how does it serve its members?

societies such as the American Heart Association (AHA),

A: In 1924, Dr. Ignacio Chávez, an acute clinician and

the Egyptian Cardiology Society and the Argentine

highly regarded professor of the School of Medicine of

Cardiology Federation, among others. These agreements

the National Autonomous University of Mexico (UNAM),

allow the members of our international partners to

was asked to reorganize the department of cardiology

participate in our academic courses and our members

at the General Hospital in Mexico City, the main teaching

in theirs, which opens the door for our membership to

hospital in the country. Dr. Chávez then traveled to Europe

present at international conferences.

with

different

international

cardiology

to continue his specialist training in this field and upon his return convened a group of esteemed cardiologists with

Q: How does SMC grow research in the cardiology field?

strong academic reputations to incorporate innovative

A: This year, SMC will create national registers for the

European technologies. This group of doctors began

collection of epidemiological data regarding the most

holding scientific meetings, with guest speakers, which

frequent cardiovascular diseases in Mexico. We are aware

resulted in the creation of the first formal postgraduate

of the urgent need to obtain our own data to be able to

course in cardiology in 1933, during the tenure of Dr.

make decisions. This great step forward is starting during

Chávez as Dean of UNAM’s Faculty of Medicine. The

this administrative period and marks the beginning of a

strong interest generated by these events resulted in the

long-term data collection strategy. CardioAcademic is a

founding of the Mexican Society of Cardiology (SMC) in

Spanish language website where cardiologists can find

1935, with the objective of promoting research, education

updated information, clinical cases, blogs and useful

and a science-based practice of cardiology.

clinical information for their patients. Internet and social media are without a doubt powerful weapons for medical

SMC supports its partners and members by organizing

information dispersal and have to be used to the maximum.

high-quality academic events, granting scholarships that enable residents to study abroad as well as facilitating the

Q: What are the main challenges that women with

participation of residents and cardiologists in international

cardiology conditions are facing and what are the

conferences such as those organized by the American

objectives of the #GoForRedWomen initiative?

College of Cardiology, the European Society of Cardiology

A: Cardiovascular disease is the main cause of death

and this year’s World Congress of Cardiology. The

and disabilities for women, according to the WHO. In

benefits of SMC membership primarily include partaking

the past, women were often overlooked for treatment of

in academic events, access to SMC’s official publication

cardiovascular diseases since it was believed that these

Revista Archivos de Cardiología de México, receiving

predominantly affected males. As a result, women were

updated information through our social media and

not submitted to routine testing and when they were

website, as well as being part of an important professional

diagnosed, the cardiovascular disease was already too

network.

advanced and with a bad prognosis.

Q: How is SMC linked with its international counterparts

#GoForRedWomen aims to raise awareness among women

and what are the objectives of international cooperation?

about cardiovascular diseases, encouraging them to take

A: SMC is one of the founding members of the

care of their health with simple measures like medical

Interamerican Cardiology Society, it is a member of the

check-ups, exercising and eating healthy. This year, SMC

World Heart Federation (WHF) and is affiliated with the

will sign an agreement with AHA to obtain the license for

European Society of Cardiology and the American College

#GoForRedWomenin Mexico and work to promote and

of Cardiology. This year, SMC established collaboration

prevent female cardiovascular health.


| VIEW FROM THE TOP

REASONABLY PRICED CARDIO MONITORNG ALTERNATIVE Carlos Sánchez R&D Manager at MyHeart

Óscar Sánchez Process Manager at MyHeart

Q: What proportion of the 17.3 million people suffering

to decrease incident numbers. However, equipment costs

from cardiovascular conditions worldwide does Mexico

continue to be the main reason behind the problem.

represent?

Federal budget allocation has been reduced resulting in

CS: Approximately 5 million people have some type

supply scarcity.

of cardiovascular condition in Mexico. Between 20-40 percent of them are aware of their problem with an even

OS: MyHeart’s main goal is to help doctors understand

smaller percentage treating the disease. The remaining

this problem, and adapt to new technologies. Veteran

population is vulnerable to cardiac arrest. In 2015, heart

MDs are reluctant, and even afraid of using newly available

disease came second to diabetes as the most common

technology such as mobile applications that are part

cause of death in Mexico. Although our strategy is focused

of the new digital health era. Our main goal is to create

on patients, MDs also benefit from our products because

accessible devices providing coverage for both private

the incurred investment is far lower than market average.

and public hospitals.

Our devices are US$3,000 to US$6,000 cheaper than our competitors’ products, lowering clients’ expenses.

Q: How does MyHeart ensure the data it gathers is the

The usual checkup price is MX$1,000-3,000 in private

highest quality for the lowest price?

institutions and waiting times in public hospitals are

CS: The components used in our products are medical

excessive. This, coupled with poor-quality and scarce

grade quality. A team of cardiologists and physicians as

infrastructure, reduces the long-term effectiveness of

well as engineers specializing in biomedicine supports our

treatment. This allows public institutions to make large

operations. Finally, we hold on-the-field trials in multiple

purchases

hospitals, and public and private clinics. This helps us

of

MyHeart

electrocardiograms

servicing

patients in public institutions.

gather opinions from many cardiologists and adapt our product to their recommendations. R&D plays an

Q: How do you hope trends will move to reduce chronic

important role in ensuring accessible costs. We only apply

diseases in Mexico?

what the market demands. Moreover, MyHealth has a two-

CS: Lack of information has hindered Mexico’s cultural shift

way encryption mechanism that secures all data gathered

toward prevention. Our products offer almost immediate

in the mobile application. We strive to protect our clients

data to patients regarding their health allowing them to

at all times.

seek treatment quicker. This improves their treatment success rate. Heart attacks happen without warning, and

Q: How has your business model developed?

patients have a 50 percent chance of survival. Even if

OS: We are in the earliest stages of acquiring funds to

they survive the organ suffers irreversible damage that

commercialize our product soon. We plan to launch

will need monitoring. Through prevention campaigns,

our solution in 2016. We foresee MyHeart products

and government subsidies we can put an end to this.

being used in many ambulances, and hospitals further

Fortunately, we are slowly starting to see some changes

along the road. We have previous experience in Class 2

in prevention trends. More people are monitoring their

product releases complying with COFEPRIS’ previous

weight because of health concerns and the number of

regulations. Nowadays, the NOM-240, NOM-241 and

products monitoring physical activity, such as Smartbands,

NOM-137 have undergone changes, and our device has

is on the rise.

adapted accordingly. MyHeart’s is waiting for COFEPRIS’ good practices audit that will result in future certifications.

Q: What role should the government take to ensure

Considering a standardization process between COFEPRIS’

service availability to treat heart problems?

NOM-241 and the FDA is underway we also expect to be

CS: An array of prevention programs must be put in place

granted access to the US market.

143


| EXPERT INSIGHT

THE CANCER BATTLE AND COSTEFFECTIVE INTERVENTIONS EDUARDO LAZCANO

utility of the HPV test in Mexico. These studies included

Director of the Research

over

250,000

Mexican

women

and

demonstrated

Center for Population Health

that clinical and self-sampled HPV tests have greater

at National Institute for Public

sensitivity than cytology. Community-based studies

Health (INSP)

showed that a single yearly HPV test is more sensitive than two Pap tests in a year. A randomized, communitybased trial showed that HPV tests done on vaginal

144

At the end of the 80's, cervical cancer constituted one of

samples that were self-collected at home were four times

the principal public health problems in Mexico. Given this,

more sensitive than cervical cytology as practiced in

during the 1990s a line of research on cervical cancer was

healthcare facilities located in rural areas in Mexico. In

created at the National Institute of Public Health (INSP)

addition, this self-sampled test is low-cost, allows semi-

of Mexico, with three principal areas: as the basis for later

automatized analysis, is easy to implement and has a

operational research, evaluation of processes and quality

lower false negative rate than cytology. Advantages

of care within the national cervical cancer detection

include that it can be done either at home or at a local

program based on cytology (Papanicolaou or Pap smears);

clinic or health center and this, in combination with

development of research using a case-control design, to

the high acceptability of self-sampled tests, allows for

identify associated factors including human papillomavirus

increased coverage.

(HPV) infection as well as epidemiological research on the impact of the cervical cancer early detection program;

Mexico has adopted evidence-based public health policy

and the first population-based studies to characterize HPV

and practice for the prevention and control of cervical

DNA genotypes in healthy women in Mexico.

cancer, including detection of and vaccination against HPV in all regions and socioeconomic groups, albeit

The initial scientific findings demonstrated that Mexico’s

targeting specific age groups. In 2006 the HPV test was

national cervical cancer detection program had fairly

introduced for primary detection in the country’s 150

severe quality issues, including low-quality cytology

most disadvantaged municipalities. Based on scientific

specimen collection, given that close to 60 percent of

evidence produced by the INSP, laboratory infrastructure

a randomly selected sample of cytology (Pap smear)

for HPV DNA analysis has been established throughout

slides lacked endocervical cells, mucus and metaplastic

most of Mexico in recent years for Seguro Popular and

cells, making them of little use for diagnostic purposes.

ISSSTE patients. Over 5 million HPV tests have been

Likewise, research established that there was an extremely

processed, concentrating principally on women above

high rate of false negative results on Pap smears. In spite

35 years of age. Women with positive HPV results are

of these findings, cytology did have a protective effect

referred for cytology. The INSP is carrying out triage

in terms of secondary prevention of cervical cancer in

studies that will provide evidence on what the best

Mexico.

diagnostic referral processes are for these women.

Given this, our research team used qualitative and

Universal vaccination against HPV among girls between

quantitative approaches to identify the principal barriers

10 and 11 years old was introduced in Mexico in 2012

to accessibility in the cervical cancer early detection

with an alternative, extended vaccine schedule. The

program as well as limitations in local program processes.

INSP recommended an HPV vaccination program using

Our research group developed the first population-based

a preliminary extended schedule of 0-6-60 months,

regional studies to characterize the presence of HPV DNA

and later confirmed that the third dose would not be

in different age groups in Mexico. This research established

necessary. As of 2014 the policy proposed by the World

that HPV is endemic in the Mexican population and has a

Health Organization is to provide two doses before

bimodal distribution by age; that is, the highest frequency

the age of 15, which has been implemented in over 80

is reached before age 25 and a second peak in frequency

countries including Mexico thanks to initiatives such as

occurs after age 65.

that recommended by the INSP.

In 2006, the Ministry of Health commissioned the INSP to

A clinical trial implemented by the INSP to evaluate

carry out two large demonstration studies to evaluate the

the immunogenicity and non-inferiority of alternative


HPV

vaccination

schedules

showed

that

vaccine-

induced antibody titers were significantly higher after

for cancer progression such as E6 oncoprotein for HPV 16 and 18 as well as p16INK4a/Ki67 biomarkers.

administration of two doses in girls 9-10 years old than after three doses in women 18-24 years old at 24

A new cervical cancer prevention and control paradigm

months after the last dose. The INSP research group is

will also be researched through a strategy that a group

analyzing the immune response observed at 48, 51 and

of international experts has called the HPV-FASTER

61 months within that clinical trial. In collaboration with

approach. This approach consists of including women

Mexico’s National Center for the Prevention and Control

up to 30 years or older in vaccination programs and

of HIV and AIDS (CENSIDA), the INSP will evaluate

pairing this with at least one HPV screening test in this

pilot programs focusing on introduction of universal

same age group. The previously mentioned INSP-IMSS

HPV vaccination among women and men with HIV.

group will coordinate a study in Tlalpan, in the southern

This research will explore acceptability of the target

part of Mexico City, focusing on producing evidence on

population and among health professionals as well as

potential benefits to adult women of a combination of

accessibility and organizational issues in implementing

HPV vaccination and screening based on testing of high-

vaccines through the national program of Ambulatory

risk HPV DNA. This could have an enormous positive

Centers for Prevention and Care of AIDS and sexually

impact since it allows exploration of the possibility for

transmitted infections (Capasits).

extending screening intervals in cancer prevention and control programs.

Cervical cancer prevention and control programs that are opportunistic, as is the case for Mexico, face a series

Given these initiatives, the INSP group has established

of challenges in terms of efficiency when following-

itself as one of the principal innovators in cervical

up diagnosis and treatment for women with HPV or

cancer prevention and control programs at a global

positive cytology. During the initial phases of HPV test

level. This research group is on the cutting edge of the

implementation, in areas where quality control and

INSP’s mission to increase social equity and protect the

follow-up processes for cervical cytology were especially

population’s health by generating and disseminating

deficient, women with positive HPV test results were

scientific evidence, in that it has proposed organized

sent directly to colposcopy. The result was a system

social responses and achieved their implementation to

overload with higher probabilities of over-diagnosis and

contribute to important reductions in cervical cancer’s

over-treatment.

impact on the community.

The principal problem Mexico’s cervical cancer prevention and control program faces is the high proportion of false negative results for cytology and a loss to follow-up of close to 50 percent after initial testing. Given this, at present women with a positive HPV test are referred for a Pap smear, which requires high-quality cytology and improved colposcopy to reach the necessary levels of diagnostic sensitivity. In Mexico and the Latin American region more research is needed on the best triage strategy for HPV positive women, which should employ biomarkers with a better predictive value for development of disease. Such a study, called FRIDA, is being carried out in Mexico, in a projected universe of 100,000 women. This is the most ambitious initiative of its kind worldwide and is being developed through collaboration between the INSP and the Epidemiologic Research Unit of IMSS of the central Mexican state of Morelos. Infrastructure for this research has been set up within the HPV molecular biology laboratory at the INSP that will allow evaluation of the utility of tests for clinical management as triage strategies, including HPV 16 and 18 typing as well as convention liquid cytology. The research will also explore cellular markers

HPV tests done on vaginal samples that were selfcollected at home were four times more sensitive than cervical cytology as practiced in healthcare facilities located in rural areas in

Mexico

145


| VIEW FROM THE TOP

SIMPLIFYING DIAGNOSTICS TO CREATE MORE SOLUTIONS FRANK ADMANT Country Manager Mexico & LATAM Northern Region of BioMérieux

Q: 146

How

are

economic

fluctuations

affecting

the

realize that incorporating innovations can save money

diagnostics segment?

by reducing the patient hospitalization times. Thus,

A: Mexico’s potential financial growth is surpassed by

hospitals could provide medical services to more patients

possibilities in healthcare. We aim to create win-win

with the same infrastructure. The new director of IMSS,

situations alongside hospitals to expand our business,

Mikel Arriola, recently announced plans to build 40 new

and help them to provide better services. Unfortunately,

clinics but we believe they should focus on improving

the current budget pressure and the weakened peso has

diagnostics

led public institutions to continuously push for lower

percent more in diagnostics could generate significant

costs. Public institutions are constantly pushing for 10

savings in areas such as treatment and hospitalization.

to 30-percent cost cuts, and that is not easy with the

The system needs more people with a holistic view,

current exchange rate.

making decisions to serve the bigger purpose, which is

inside

existing

hospitals.

Investing

30

having a healthy population. Economic turmoil also affects ongoing projects such as the microbial resistance program. This initiative collects

Q: According to clinics operating your equipment, should

data about microbial sensitivity to antibiotics and

the healthcare system prioritize hiring specialized

the doses in which these drugs are effective. There is

technicians or increasing infrastructure?

room to introduce new platforms in public institutions

A: Staff members generally leave within their first six

to support the identification of pathogens quicker.

months significantly increasing job rotation. Considering

This will result in better health outcomes for patients,

technicians’ learning curve of four to five months we have

and represents an important measure in stopping the

to provide training twice a year. Moreover, hospitals and

spread of superbug microbes that are highly resistant

clinics lose their expertise as high-technology diagnostic

to most if not all antibiotics. Budget constraints and

equipment requires fully trained personnel.

high exchange rates are causing ROIs on these kinds of projects to take five years, conflicting with public tenders

We

that last three years. Therefore, we focus on generating

applications that do not require highly specialized

sustainable growth and increasing effectiveness within

operators. We aim to simplify diagnostics to bring

the organization to do more with fewer resources.

more solutions to areas lacking specialized personnel.

have

created

user-friendly

molecular

biology

Molecular biology applications are already employed in Players in the healthcare sector should increase their

private and public markets and shorten diagnostic times

focus on pharmacoeconomics. Public institutions must

while improving pathogen detection accuracy. Many key decision makers in the public sector are interested in

“The system needs more people with a holistic view making decisions to serve the bigger purpose, which is

new technology but struggle against budget constraints, and depend on discounts. Our company wants BioMérieux’s platforms to be included in the basic formulary. However, this is a

sophisticated

process

and

we

are

conducting

pharmacoeconomic studies to collect enough evidence

having a healthy population”

of the impact and value they can generate for institutions.

Frank Admant, Country Manager Mexico & LATAM

cases, or nosocomial diseases is available, and we

Northern Region of BioMérieux

cannot fix a problem that cannot be measured. This is

However, little information on mortality, septicemia


a huge gap in Mexico and we cannot fix a problem that

now available in private hospitals and not in public

is not measured. In Europe and the US all these cases

institutions, yet physicians in public hospitals are aware

are reported and recorded, so there is plenty of data

that this application exists and are interested in acquiring

available for healthcare providers and patients. In the

it. Insurance companies can benefit greatly from this test

US there have been trials that resulted from ineffective

to avoid unnecessary expenses.

detection of septicemia, whereas in Mexico septicemia cases are not properly reported and are excused as

Q: What role should new molecular biology applications

mere complications. The first step to finding a solution

play in improving patients’ access to diagnostic tests?

is recognizing the problem.

A: Mexico has many challenges to deliver healthcare services to rural and remote areas. Sometimes patients

Q: What is unique about your molecular biology

have to travel 50 km to visit the nearest clinic, which

platform for pathogen detection?

increases

A: A clinician can identify up to 20 pathogens with

enough to be taken to remote communities, so this

this test. We are commercializing panels for infections

changes the whole paradigm of medical care. Instead of

of the digestive and respiratory tracts, and for sepsis.

expecting patients to travel long distances, we take the

The respiratory panel includes influenza and detection

equipment with us and improve access to cutting-edge

of other viruses, parasites, fungi and bacteria, while the

diagnostic tools. Mexico is not the only country with this

gastrointestinal panel mostly detects parasites.

problem, this happens in all Latin America, including

expenditures.

Our

FilmArray

is

portable

Brazil and Argentina. This panel is helpful to avoid misuse of antibiotics, for instance during viral infections, and detects the drugs

Our platform is the simplest to use with a broad coverage

to which these pathogens are sensitive. It is perfect to

of more than 200 pathogens of infectious diseases that

diagnose infectious diseases and design the best treatment.

have a high impact on public health. These include sepsis, respiratory meningitis and gastrointestinal infections.

When physicians receive cases of acute and severe

Symptoms of all of these pathologies overlap representing

infections, they can use the panel to detect the reason

a diagnostic challenge. Many of these illnesses are time-

behind the symptoms within an hour. This is relevant

sensitive, and FilmArray provides rapid information to

in the detection and treatment of septicemia, which

improve medical decisions and patient recovery. We

becomes more deadly every hour the patient remains

believe that molecular testing will become routine.

without treatment. The mortality rate of septicemia is 98 percent after 36 hours.

This molecular biology platform for pathogen detection is our priority. We are also tapping into implementing

Q: Influenza is considered an important driver in your

process automatization solutions in laboratories. These

annual financial report. What applications do you have

require significant investments and changes to how

for this disease?

processes are managed inside institutions and hospitals.

A: The flu pandemic is certainly driving this business division. Physicians frequently use a low cost, rapid test to detect influenza. But this is a test for an individual virus, so every day they do several tests to identify what virus or pathogens patients have. We have a very affordable solution for that and also a molecular biology platform, which costs 15 times more than the rapid test but it’s better to use from the beginning and provides results within an hour. This is a multiplex PCR technology called FilmArray that was commercialized by BioFire, a company acquired by BioMÊrieux in 2015. The healthcare system needs people with a wider view, who can push for the implementation of these solutions. The latter are quite important in the treatment of immunosuppressed patients or those with complex diseases such as diabetes and cancer. Our test is

Investing 30 percent more in diagnostics could generate significant savings in treatment and hospitalization

147


| ANALYSIS

VACCINATION CULTURE PREVALENT IN MEXICO Routine vaccines are among the most important yet simple

of children in France and 91 percent of children in the US

preventive practices a country can implement. “Vaccines

receive the same treatment. The percentage of vaccinations

are one of the best preventive measures that can be offered

against diphtheria, tetanus and pertussis, however, is lower.

and cutting public funds for vaccines is counterproductive.

Only 87 percent of children in Mexico are vaccinated within

People are more at risk of becoming ill and ultimately public

the recommended timeframe.

resources are wasted in curing preventable health issues,” Organizations such as UNICEF are taking advantage of

says Roberto Tapia of the Fundación Carlos Slim.

widespread vaccinations to further improve the preventive culture among Mexicans. “We placed educational inserts in

give parents a booklet that contains all information related

vaccine cards, for example. The idea is that UNICEF does

to a person’s health and a strict guide of ages at which

it the first time and the government takes over afterward.

their children should receive a particular vaccine. Schools

This has been our way to help prevent obesity, early infant

across the world bring in nurses to administer vaccines to

death and promote breastfeeding,” says Isabel Crowley. The

classrooms at a certain age, ensuring all children receive the

need for vaccination does not stop after childhood. Regular

preventive medicine. In spite of many lamenting the lack of

updates are recommended, particularly against seasonal

preventive culture in Mexico, vaccination seems to be an area

viruses and in older people. Armando Ahued of the Mexico

Mexico is excelling at. According to the OECD, 98 percent

City Ministry of Health stresses: “In October, we will start

of children in Mexico are vaccinated against measles within

vaccinating against influenza. There is a vaccine, it is free

the recommended timeframe. By comparison, 90 percent

and people need to come and get it.”

PERCENTAGE OF CHILDREN VACCINATED AGAINST MEASLES IN 2014 CHILDREN VACCINATED AGAINST MEASLES IN 2014 (percent) 100 80 60 40

Poland

Mexico

Brazil

Canada

Turkey

Norway

Chile

Switzerland

Australia

US

France

0

India

20

Source: OECD PERCENTAGE OF CHILDREN VACCINATED AGAINST DIPHTHERIA, TETANUS CHILDREN VACCINATED AGAINST DIPHTHERIA, TETANUS AND PERTUSSIS INAND 2014PERTUSSIS (percent) IN 2014

100 80 60 40

Source: OECD

Poland

France

Turkey

Canada

US

Norway

Brazil

Chile

Switzerland

Source: OECD

Australia

0

Mexico

20

India

148

Most vaccinations occur during childhood. Some countries


| VIEW FROM THE TOP

STRONGER, TALLER, HEALTHIER

JUAN TAMAYO President of Mexican Committee for the Prevention of Osteoporosis (COMOP)

Q: How has your unique collaboration with the WHO led

treatment side. In 2012, we had explored all the areas

to results for your company?

that interested us so we closed it down and opened

A: We launched the NiĂąos y Adolecentes +Fuertes, +Altos,

Accessalud. What has survived since 1994 is the NGO,

+Sanos program to prevent osteoporosis from the womb

COMOP. The organization turned to clinical research

onward. This has given us an enormous amount of data,

and Osteosol expanded its focus on chronic, non-

and parents appreciate seeing how their children are

transmittable diseases through Accessalud. The areas

growing. We do all of this to make children strong, tall and

that have developed are epidemiology, and clinical trials

healthy. This program has led us to collaborate with many

for pharmaceutical companies. Many Mexican pharma

organizations such as Danone and Save the Children, and

companies ask us to be their CRO because we have

we are working with Mexico’s Infantile System Telethon

several contacts in biotechnology and in generics, and we

and with Save the Children, with the Primary School of

know people in touch with administrative processes. We

the State of Mexico and the Center of Medicine, Physical

have also begun participating, and have learned a great

Activity, and Sports of the UAEM. The program generates

deal in biogenetics.

much interest. Three years ago we began the Oseograph, a patented method that uses a series of data to produce a

Q: What other collaborations allow COMOP to influence,

graph showing people the state of their bones.

and learn from the sector? A: Recently, the INSP held a forum in which the deans of

Q: How have your operations evolved from a non-profit

the 10 biggest virtual education institutions participated,

into a private entity?

such as Johns Hopkins University, Harvard, MIT, the

A: We began as an NGO in 1994, such that all the patrimony

University of California in San Francisco, two European

of COMOP is property of the nation. This poses several

universities and Coursera. Now we provide Massive

difficulties for growth and interaction with stakeholders.

Online Open Courses (MOOCs) specializing in the health

Certain players in the health sector preferred to interact

sector because we believe that everyone has the right

with private enterprises so we created Osteosol in 2000.

to education. We ran our first month-long course from

This company invited a group of eight members, four

October to November in 2015, and an incredible 15,000

of whom were from the pharmaceutical industry, and

people signed up. Nevertheless, we encountered several

four were investors. This was our first operational health

difficulties. In the first week the platform director changed

business model focused on obtaining quality outcomes

five times so it was difficult for students to get answers

for citizens. We modified our offices to be able to receive

to their questions and our participation rate dropped to

walk-in patients. Compiling a database was a good

11,000. However, 4,000 people completed the course in

experience bearing in mind that we did not have laptops,

spite of teething problems.

smartphones, or tablets back then. It allowed us to expand on what we could do as an NGO. We have had international

COMOP aims to gain experience with 60,000 patients

reach since COMOP joined the International Osteoporosis

in two years to be able to give the Ministry of Health

Foundation in 1999 but our experience from 2000-2012

and Seguro Popular quality clinical outcomes. Notably,

contrasted greatly with the financial expectations we

the WHO and the UN participated in the Millennium

had. We saw the world of health fluctuate. Today, bone

Development Goals containing an area dedicated to good

diseases are recognized as dangerous for public health

health and wellbeing. This program tries to fight obesity,

and the health sector.

and anorexia without stigmatizing people involved as few individuals are in the correct weight range. Whether we

Through Osteosol, we researched the effects of weak

expand through venture capital or franchises we have the

bones on the nation and have since turned to the

model in place and the association is more ready than ever.

149


| VIEW FROM THE TOP

DIGITALIZING MEXICAN DIAGNOSTICS CARLOS HERNÁNDEZ Hispanic America Regional Director, Diagnostics Division of Siemens Healthineers

150

Q: How has the health system digitalized and automated

solutions, like combining our ultrasound platform in the

since last year? Is there more cooperation between

diagnosis of prostate cancer combined with our PSA

entities in terms of sharing information?

laboratory test.

A: The healthcare sector is aware of the importance of digitalization and automation. Customers look forward to

Q: What products have you launched since we spoke with

having better results at lower costs and technology is the

you last year?

driver to accomplish that.

A: One of the most important projects we launched was with the Hospital Juárez, which has been a success story

Even though there is a sense of awareness about this

for us and where our APTIO and CentraLink solutions

issue, not everyone can update or change operations the

have been working to benefit thousands of patients daily.

same way at the same time because of different dynamics,

With this solution the laboratory now is connected and

but as time goes by there are more and more institutions

optimization of test processing has decreased by up to

implementing this way of work. We want to be a partner

40 percent. So we are talking about one unified solution

to help them accomplish that. Trends like diabetes,

that transforms lab operations, unifies and accommodates

cardiovascular diseases and cancer, in addition to an aging

current and future needs.

population, pose a huge care challenge to both the private and public health systems.

Q: Awareness of the importance of early detection and diagnosis is a problem in Mexico. What can be done by

We work hard to develop solutions to meet customers’

the industry to promote this?

expectations not only with our products but with related

A: Early detection and prevention is the way to go and we

services and systems. One example is the APTIO total

see that our healthcare authorities are gradually moving

automation system and CentraLink middleware solution

toward this direction.

that help laboratories have only one system which process most of their needs with maximum efficiency

It is important to keep in mind that in vitro diagnostics

and productivity, reducing risks, maximizing output and

account for around 2-3 percent of the total of healthcare

quality, providing real-time visibility of the process and

costs internationally but affect 70 percent of all critical

information flow. There is still a long way to go but we are

clinical decisions. By detecting predispositions, laboratory

convinced there is no way back. In Siemens Healthineers

diagnostics can improve disease prevention and will

we believe in the power of innovation and technology as

become more important, reducing cost of care with

the future of the business.

higher possibilities of success. Of course patient education and changing behaviors and habits are fundamental to

Q: Last year you told us that in vitro diagnostics such as

improving the general population´s health.

tumor markers and vitamin D tests were underutilized in Mexico despite their usefulness. How has this evolved and

Q: How has Siemens Diagnostics division been affected

what benefits could they bring to Mexican diagnostics?

by recent health budget cuts?

A: We have seen some changes but modifying these trends

A: We see these cuts as an opportunity to position our

requires long-term effort, which starts with training of

solutions, which generate efficiency and productivity.

healthcare professionals in universities and communication

Budget constraints and cost cutting are megatrends

of the clinical benefits of these tests for patients and

around the world and Siemens Healthineers solutions

doctors to achieve earlier and more accurate diagnostics.

are designed to help our customers cope with increasing

Siemens Healthineers is starting to promote the joint use

demand for services, reduced staffing and budgeting and

of our technologies and we are promoting total diagnostic

more stringent Key Performance Indecators.


| VIEW FROM THE TOP

MIROCULUS STARTS DETECTION ON STOMACH CANCER JORGE SOTO CTO of Miroculus

Q: How have the public and professionals received

sample from people, which can detect many illnesses.

Miroculus in Mexico?

There are already very good prevention campaigns for

A: The response has been positive. We are looking at better

breast, cervical and prostate cancers. We need to add lung

and easier ways to diagnose diseases and allow patients

and stomach cancers to that list as they are the deadliest

access to a state-of-the-art diagnostic tool that is easy to

in Mexico.

use, and affordable. We are focusing on demonstrating our technological, biological and clinical results.

Q: The Mexican public sometimes mistrusts vaccinations, such as that against cervical cancer. How can Miroculus

We presented our product and results at the Liquid Biopsy

and early detection help change this view?

Summit in San Francisco. We completed a study with 650

A: It is very important to demonstrate the device works,

people for stomach cancer detection. This will be the first

and to show sensitivity levels and its predictive value.

application. We have associated symptoms in patients

We mostly plan to work with institutions, and MDs

across five hospitals in three different countries with

to build this. The machine is not something we can

stomach cancer, gastritis, atrophic gastritis and intestinal

build independently since they are the experts who

metaplasia. We still need to validate these results but we are

can advise us on the best course of action. We joined

collecting new samples in other countries like Guatemala,

many medical institutions and research labs such as the

and Chile among others for data corroboration. We hope

Catholic University Hospital of Chile, and UCSF or Johns

to market our product by 2018.

Hopkins University in the US. We aim to build together, to understand the medical needs and the information

We have approached several institutions such as private

doctors need. We aim to have Miroculus ready as soon

hospitals in Mexico City and public institutions such as the

as possible so we can detect, and diagnose earlier and

INCAN and IMSS. Both are keen on potentially conducting

more efficiently.

a clinical study. Mexico is definitely one of our priority countries. We really want to test Miroculus in Mexico, and I

Q: Your device detects a certain number of cancers. How

believe we will do so by the end of 2016.

long will it be before it can detect all known cancers? A: Our device currently focuses on detecting microRNAs

Q: What steps do you think we can take to create a culture

while other labs, and researchers are validating the

of prevention and early detection in Mexico and how can

presence of microRNAs and specific diseases. Our

your device help?

company is focusing on discovering the validity and

A: The World Health Organization (WHO) stated that to

clinical utility of stomach cancer detection and microRNAs

tackle cancer we need to develop a better understanding of

first. The validation process is not particularly simple. It

preventive measures. This benefits patients, the economy,

is rigorous. Miroculus technology does not stand alone.

health institutions, and the government. Public health

Other specialists are developing technologies to detect

systems like those in Mexico need to start addressing the

several types of cancer. I am sure that within the next 10

most prevalent and the deadliest diseases in the country

years we will see technology that detects several types of

and encourage early detection.

cancer with one single blood sample.

Certain cancers are associated with lower recovery rates,

The design of our technology will be open to all. We

such as stomach cancer, the second deadliest cancer in

have several prototypes. The instrument we are building

Mexico, and it is difficult to detect at an early stage. It

to better understand the needs of hospitals and doctors

requires an endoscopy and it is impossible to provide all

will be very different. It should be available by late 2017

the population with one. It is possible to take a small blood

or early 2018.

151



DIGITAL HEALTH

7

Digital advances are impacting every sector and Mexico’s health industry is no exception. The Ministry of Health is working on a national electronic registry for health information that would digitalize patient records and prevent duplications of registrations and payouts between IMSS, ISSSTE and Seguro Popular. While public institutions are striving to digitalize and streamline processes, private companies are working on technology to help the individual user, with a particular focus on mobile apps. International institutions such as UNICEF are also ramping up their IT focus, working with the government and telecoms to gather data targeting improved conditions for the most vulnerable sectors of the population.

Many digital apps are educational in nature, targeting the distribution of preventive information on subjects such as controlling diabetes, preventing obesity and best practices in antenatal and postnatal care and breastfeeding. The ease of access helps these programs succeed, although more can be done. There are also companies specializing in big data, collecting statistics on the Mexican healthcare system to help hospitals and medical practitioners analyze the needs of the population and holes in the system to improve the care and services they provide. This chapter introduces the pioneers of digital health in the public and private sectors.

153



| CHAPTER 7: DIGITAL HEALTH 156

VIEW FROM THE TOP: Xavier Valdéz, IMS Health for Mexico and Central America

157

VIEW FROM THE TOP: Álvaro Duque, Novartis

158

VIEW FROM THE TOP: Fermín Valenzuela, QBD Consulting

159

VIEW FROM THE TOP: José Alarcón, PwC

160

VIEW FROM THE TOP: Mónica Domínguez, Smile Train

Pamela Sheeran, Smile Train

David Almanza, Palindromo

162

VIEW FROM THE TOP: Pablo Pantaleoni, Medtep

164

VIEW FROM THE TOP: Roberto Tapia, Fundación Carlos Slim

165

VIEW FROM THE TOP: Javier Cardona, 1DOC3

166

VIEW FROM THE TOP: Alejandro de la Parra, Astrum Salud

168

VIEW FROM THE TOP: Xavier Boadas, Avinent

168

INSIGHT: Ana Pulido, Digitalizatxt

170

VIEW FROM THE TOP: Jaime Archundia, UNICEF

172

VIEW FROM THE TOP: Gabriela Allard, Mexican Diabetes Association

172

VIEW FROM THE TOP: Guillaume Corpart, Global Health Intelligence

155


| VIEW FROM THE TOP

MOBILE INTELLIGENCE FOR BETTER HEALTH DECISIONS XAVIER VALDÉZ Director General of IMS Health for Mexico and Central America

Q: What can you tell me about your new app?

156

Of this, 26 percent represents institutional purchasing of

A: One of the key products IMS integrated to its portfolio

medicine and 74 percent is due to pharmacy sales. We

through

(Mobile

are interested in being present in both sectors to have a

Intelligence) our customer relationship management

complete vision of the pharma market. We have a panel

platform, a fundamental piece to multiply our client’s

of over 2,000 doctors we interview regularly, from which

competitiveness in the health market. In today´s business

we obtain information on the principal diagnostics, what

environment immediate communication and decisions are

treatments are being applied and which products are being

critical to compete, which is why IMS recently launched

prescribed. This provides us with a national picture of how

REPWear & MGRWear apps for the AppleWatch as a

illnesses are evolving, what medicine is being consumed

convenient MI functionality, allowing immediate attention

and the treatment being applied. In the future we would like

to issues that impact business. All our platforms and apps

to have a more precise vision of the management process

are interoperable, not just in a technical sense but also

of high-cost illnesses such as oncology. Public institutions

in the analysis of the data we produce and include. We

certainly are developing digital systems at varying levels

process more than 5 million daily medicine sales in Mexico.

of implementation. Private hospitals are also developing

We can include analytics of our own sources and/or many

this, but there are smaller institutions with more limited

data sources in each device to allow our clients immediate

resources that are not at the same level.

the

Cegedim

acquisition

was

MI

access, such as you can do with a wearable device. All our developments have a series of applications with the ability

Q: What is IMS Health working on to ensure the safety of

of being connected.

sensitive data? A: We have a code and a series of algorithms that

Q: What information have you gained on the health

anonymize the information. A user would only be able to

situation of Mexico?

trace what treatment has been given and what the results

A: We are seeing a period of innovation in terms of

were. This is important information for health providers to

integrating the health system. The directors of IMSS

figure out which treatment works and what side effects

and ISSSTE are looking to optimize the use of existing

occurred. There is much value in this and we do this on

facilities. This is a good idea, but implementation will

a global level. It would be ideal to bring this to Mexico.

be complex. We aim to know the cost of treatment in

For this to happen, we need to be able to enter clinical

different institutions so patients have the possibility to

files and databases. Larger institutions are implementing

move between them, but it will take time. We work in three

digital systems but smaller clinics may not be up to speed.

areas of business: information, technology and consulting.

There will be a moment when this matures and companies

We gather information on public and private consumption

such as IMS Health will be able to enter the market.

of medicine and on the treatment of illnesses. As for

Some institutions are already working on a database of

technology services, we provide much support and

oncological patients through the INCan. Some states, such

integrate hospital information, production and efficiency

as Colima and Jalisco, have begun to digitalize.

indicators. Finally, in our consultancy practices we can help define the basic measures of medicines and which

Q: What will we see from IMS Health going forward?

are the most used types of medicines.

A: We are in the midst of a merger with Quintiles. They bring services such as clinical research and sales force

Q: What are the main partnerships you want to create in

services. From this merger you will see a company with

those areas? Are they public or private?

a much greater capacity to give integral services to labs

A: We are looking for both as the Mexican pharma market

and hospitals alike. The merger may conclude by the end

was worth around MX$209 billion (US$11.2 billion) in 2015.

of the year.


| VIEW FROM THE TOP

BIG DATA A PILLAR IN DIGITAL ERA ÁLVARO DUQUE Digital Marketing Leader of Novartis

Q: Digitalization is changing the healthcare industry.

trend is swiftly spreading throughout the pharmaceutical

How is Novartis restructuring its internal processes to

industry and results will soon be presented. Although

take advantage of progression in both clients and end

governmental agencies have not caught up to the latest

consumers?

technology trends, we must always consider a country’s

A: Our efforts focus on providing better solutions and

health regulations. Novartis’ digital interaction methods

differentiated drugs to our patients. Companies are subject

must run parallel with Mexico’s legal framework at all times.

to external market pressures, as pre-established consumer

Data privacy is a huge concern in the industry and we base

trends must be followed. According to the Mexican Internet

our work around enforced regulations. Marketing law is

Association (AMIPCI), Mexico will see 60 million Internet

quite intricate and Novartis is adhering to it verbatim.

users in the short term, creating enough pressure to get companies moving. Mobility should be kept in mind as the

Q: What developments will we see from Novartis’

number of smartphones has surpassed the volume of PCs

collaboration with Google?

owned by consumers. All things considered, companies

A: After its digital transformation initiative was put in

must adapt their communication mechanisms to patients,

place the company began creating strategic alliances

doctors and end consumers.

with key players. The Internet tycoon and its Google Glass development was a perfect fit. Novartis is tackling

Q: What opportunities are there for pharmaceutical

ophthalmological conditions creating a medical device

enterprises in emerging markets?

application with Google Glass that can measure some

A: The market is undergoing an important change. The

clinical parameters. We find eye pressure and glucose

digital era is considered a crucial time in the fourth

readings among those. These initiatives will give life to

industrial revolution and Novartis has benefited from it.

new health and technology applications, which will serve

A few years back the company implemented its digital

as the foundation to the future of the industry. Big data is

transformation initiative. Although it involved multiple

a pillar in the digital era and we have partnered with data

areas, it primarily focused on the company’s marketing

management enterprises. The amount of analytics needed

division. Also, the creation of a digital drug portfolio has

in this segment is overwhelming. Partnering with them was

placed Novartis at the forefront. We will tackle this new

a natural progression. Even at its most basic layer, sales

digital inclination from multiple perspectives but mainly

representatives have a significant amount of big data to

through strategic alliances, technological platforms and

manage and process, especially as multi-communication

digital laboratories and marketing. Virtual congresses

channels shift the face-to-face perspective.

have become the industry’s latest communication and capacitation format. Through virtual platforms, thousands

Q: Novartis Mexico invested US$50 million in R&D

can access the same information.

activities. How will the company benefit from this type of investment and how will it impact the company’s global

Q: How has digitalization impacted both consumer

operations?

behavior and Novartis’ operations?

A: Novartis bets on R&D, which translates to the number

A: We find ourselves disrupting previous technology

of product developments in the company’s pipeline.

implementations. We are adapting to new working patterns

It is the largest of its kind. Mexico is one of the leading

with patients and doctors and they are trying to acclimatize

countries in our headquarters’ global strategy not only

to the new technological wave. Although webpages are

because of its large demographics but also due to the

nothing new, the market was lacking a comprehensive

interests the company has in the country. We are looking

digital ecosystem to face a new and broader operational

to maintain our position as an R&D leader and Mexico will

modality. It is still too early to have reliable hard data but the

help us keep on track.

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| VIEW FROM THE TOP

TIME FOR A REINVENTION

FERMÍN VALENZUELA Director at QBD Consulting

158

Q: After 11 years of managing pharmacological and

satisfy the needs of our clients. We propose process

biopharmaceutical research, what pushed you toward

analyses to pinpoint problems that are not seen by the

consulting?

organization, such as redundancies, lax controls and a lack

A: It was time for a reinvention. Research, especially

of communication between areas. Many holes in the fabric

clinical,

The

of the trials become apparent and we can begin to search

incorporation of new technologies and new approaches

for solutions. IT can optimize many processes and QBD

became necessary. QBD Consulting began proposing

Consulting looks for solutions tailored to each client’s

new approaches to clinical research while using new

specific needs.

tends

to

follow

the

same

patterns.

technologies and operating under a risk management approach. Collaborative efforts from players in the clinical

We implement electronic solutions for clinical trials. These

research and IT arenas gave life to QBD Consulting. In

can include eCRFs, eCH, and ePOR. All these solutions

return, we have given the industry a new approach to

are provided by our strategic ally Digitalizatxt and offer

how CROs and pharmaceutical laboratories can conduct

the advantage that monitoring can be done in real time

clinical studies. As most IT platforms used in clinical trials

to detect any kind of anomaly immediately. Master file

are provided by sponsors, we collaborate with CROs and

integration is done almost automatically. These solutions

Mexican pharmaceutical companies, since Big Pharma

allow the sponsor to reduce the time of study, follow

only uses their own solutions.

advances online, oversee all sites’ behavior and decrease the number of physical visits to the sites. This translates to

“We propose process analyses to pinpoint problems that are not seen by the organization, such as redundancies and

a decrease in time and costs. Having control of the study assures clean and verified data and compliance. Q: How open are clinical trial sites to acquiring technology solutions to manage their processes? A: If all stakeholders participate in the first phase, people discover the advantages of new models and

lax controls and a lack of

approaches. Concerning clinical trials, if you are able to

communication between areas”

solutions, and convince them they do not imply double

Fermín Valenzuela, Director at QBD Consulting

accept the reduced paperwork. Acceptance only happens

clearly communicate the benefits of using electronic the work but a simplification of all red tape, they happily after a period of reluctance. The results are what make

Q: What are the biggest needs of the clinical research

them accept the change following a long and complex

industry in terms of quality and process optimization?

educational process.

A: Although most sites and clinical research organizations have correct and orderly procedures, few have performed

Q: What certifications endorse the quality of QBD

in-depth analyses of their processes. This is the main tool

Consulting’s technology?

to see if procedures are in agreement with regulations

A: All our solutions have been developed following

and to identify risk factors. Analysis also identifies which

GAMP5, and they comply with Mexican regulations as well

processes could be automated. This allows times and costs

as CFR21. Some of the solutions developed by Digitalizatxt

of clinical studies to be brought down and helps us assure

have been analyzed and approved by COFEPRIS. The

quality and compliance. One of the value propositions

company also participates at academic events to promote

of QBD Consulting is the use of novel technology to

our solutions among industry experts.


| VIEW FROM THE TOP

DIGITALIZING THE MEXICAN HEALTHCARE SYSTEM JOSÉ ALARCÓN Partner and Leader of Health Services of PwC

Q: What are the advantages for the Mexican healthcare

Q: How do you think we can make digital healthcare

system becoming more digitalized?

providers more aware of cybersecurity risks and how do

A: One big advantage to using digital technology is that

we assure clients that their data will remain confidential?

it can enable health rights to become immediately more

A: The most mature in terms of cybersecurity are the

transportable. There also need to be the right incentives

insurance companies and the least mature are the health

for the health sector to make health records electronic

providers. The pharma and medical device companies

and make sure this is implemented correctly. INEGI has

are in between. At PwC we have some workshops for

a lot of information but there needs to be more efficient

healthcare providers’ boards to show them worst-case

ways to analyze data. The Ministry of Health’s National

scenarios, yet since there are no known such cases, it is a

Basic Health Information System (SINBA) is taking solid

slow process to get them to that level of awareness about

steps toward building a platform for all the incoming data

cyber threats.

from different health sector members so that it can be used by the public and private health care systems. They

Q: How can we use mobile health to prevent and fight

would also like to add all newborns into the electronic

many of the diseases we see in Mexico, like diabetes?

system from the moment their birth certificate is issued.

A: Prevention is very difficult but it is easier to help

This pilot program will take about a year and a half to

prevention

be fully implemented and is a step in the right direction.

marginalized, who are more concerned with other

Another relevant need is to create with the help of the

priorities. There are about 35 million middle class

Association of Insurance Companies (AMIS), and the

Mexicans. If we assume 5.2 million are privately insured,

Association of National Private Hospitals (ANHP) a

then there is a large marketplace for insurance, and

database where performance indicators of private and

a huge opportunity for wellness programs. There are

public hospitals is accessible to everybody. This will

around 25 companies that insure accidents and diseases,

help patients make educated decisions based on public

and there are only 10 health-specialized insurers (ISES).

information.

By law, ISES have to sell preventive and integrated care

efforts

for

the

middle

class

than

the

products but this model was not developed correctly due Meanwhile, on the digital side we are showing the

to the political problems that arise from having to give

Mexican health system a model sponsored by PwC and

IMSS’s resources to someone else. So now there are only

the University of Texas (UT). A community was created

four ISES that are focused on integrated health and six

for the relatively high diabetic population in Brownsville.

focused on dental services. Major accidents and health

Members are registered in the system, and if they are

insurance companies are allowed to provide preventive

diabetic or have a high risk for diabetes they are put into

care but only with reimbursements

a program to help them control it. This type of model could be brought here by insurance companies in alliance with pharma companies to manage costs and improve

“There need to be the right

health.

incentives for the health

Bodylogical is also an innovative digital tool we use

sector to make health records

to model the physiology of your body to give an individualized profile. This helps insurance companies determine

high-cost

customers

and

gives

them

electronic and make sure this

predictions of future risks, and programs on how to

is implemented correctly”

reduce it and lower costs.

José Alarcon, Partner and Lead, Health Services of PwC

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| VIEW FROM THE TOP

UNIQUE APP MITIGATES CLEFT PALATE IN CHILDREN

Mónica Domínguez Program Director Mexico and Central America at Smile Train 160

Pamela Sheeran Vice President of Smile Train

David Almanza Project Leader at Palindromo

Q: How does your unique app for children and physicians

PS: We have worked with a local partner called "Hablarte

software support patients’ therapy?

e Integrarte", a Mexico City-based speech therapy

MD: Smile Train is an app focused on cleft lip and

program. Dr. María del Carmen Pamplona launched the

palate that was established in 1999 and was brought to

program in 2001 gathering expertise until 2012 when the

Mexico in 2001. Today, we are in 85 countries and we

program was transformed into an app. Therapists have

work closely with local centers providing medical care

been extremely receptive to the app, and have shown

to children with this condition. We have 26 partners in

great enthusiasm at the prospect of its incorporation

Mexico, including ABC Hospitals. We provide funding for

into their practice since they consider it a creative and

the instruments, materials and any other components

unique form of support for patients. As mentioned,

needed for the complementary treatment of children

many children face difficulties in attending speech

affected by the condition.

therapy consultations, so the app allows therapists to help more children. Smile Train is all about increasing

Smile Train has also grown to cover a broader spectrum of

accessibility and empowering local programs by offering

services that goes beyond just surgery, such as follow-up

these services at no cost. Children who have used the

treatments and consultations. The comprehensive care

program have responded extremely positively to the

children require includes speech therapy, orthodontics,

dynamic therapy sessions it provides.

dental treatment and psychological care, among others. Speech therapy plays an extremely important role

Q: How does the app engage children to encourage

because patients with cleft palate tend to develop a way

them to use it long term?

of speaking in a nasal manner. They need post-surgery

MD: The app includes some songs, stories and drawings

treatment to modulate their voice and develop correct

and focuses on specific phonemes that are difficult to

pronunciation of several phonemes. This therapy should

pronounce for children that were born with cleft palate.

be administered twice a week for significant impact to be

Developing correct pronunciation also depends on the

witnessed but many of these children live in rural areas

technique and skills of the surgeon. The development

and cannot visit their therapist on such a regular basis.

of the app was a long learning curve. We needed to

We aimed to develop a digital tool to facilitate at-home

collaborate with speech therapists in a unique and

speech therapy. This results in fewer hospital trips for

creative way to develop something new. Speech

families, mitigating cost and transportation expenditure.

therapists piloted the app and realized the potential it had to bridge some of the most significant gaps in the

“Many children face

field, such as follow-up treatments.

difficulties in attending

We initially launched the interface on tablets. The

speech therapy consultations,

receptive toward the songs and games related to

so the app allows therapists to help more children” Pamela Sheeran, Vice President of Smile Train

team quickly discovered that children were incredibly phonemes. The app provides a significant educational value since the voice recognition system only allows the user to move to the next game if words are pronounced correctly. It has different areas to work on for children to advance through the various stages.


Our next challenge was to develop more material, activities and phonemes and to tackle greater challenges. For instance, speech therapy centers on patients’ abilities to articulate phonemes and integrate them into their daily speech from a cognitive standpoint. Sometimes they are able to articulate a phoneme correctly during the therapy but cannot use it in a word as part of a sentence. We posited that recording children’s voices while they were singing would provide valuable information about their progress. Q: What technical issues did you encounter in the development of the app and how did you resolve them? DA: The project initially included stories and songs. Then

“Speech therapists piloted the app and realized the potential it had to bridge some of the most significant gaps in the field, such as follow-up treatments” Mónica Domínguez, Program Director Mexico and Central America at Smile Train

we incorporated an update wherein the child could hear his or her own voice and the app evaluates the way in which

outset, we developed a virtual surgery training CD to provide

the child articulates phonemes. This was an interesting

education to doctors. We also realized it was necessary to

challenge because the software did not previously exist, so

create a medical database and patient records for all the

we used the Google voice recognition app to develop three

children we are helping. This allowed us to monitor the

songs, with one voice exercise per song. As Smile Train

quality of the surgeries. The speech therapy app received

wanted to increase the number of stories and activities,

solid support from our board of directors and the staff in

they requested six stories with different voice exercises.

Palindromo, especially since this is a philanthropic venture.

We also created another engine that recognizes one word

The database was developed by a well-known company in

and generates six more, which gave greater flexibility to

the US, for whom security is of the utmost importance. A

the app instead of recycling a fixed set of words. A narrow

limited number of people have access to patient records

list of words would reduce the app’s usefulness and if the

and therapists can only access their own files. The database

child stumbles on a certain word, he or she can become

only gathers information regarding surgeries but it will

frustrated.

soon include voice recordings from the app.

MD: Initially, we were working with seven kids using tablets,

DA: Palindromo has supported Smile Train in designing

but we soon developed a cellphone version too because

the website and creating social media content. With this

it is more likely that children in rural areas have access to

digital healthcare project, Palindromo is committed to

such a device. Voice recordings are sent to and stored in

helping people overcome physical limitations. Through

the cloud. These are evaluated by therapists, for whom we

this experience, we can see ourselves supporting other

developed a complementary app. When the patient returns

initiatives in the healthcare field. Nonetheless, there are

for a follow-up session, the therapists are already aware of

several barriers, such as the platform technology, the media

the areas in need of development. This represents a more

and Mexico’s lack of data transfer infrastructure. Creating a

accurate way to guide the children’s progress.

voice recognition app was a huge challenge but a rewarding experience for Palindromo.

To date, the app has been downloaded more than 4,000 times, of which 3,500 were children. We have not carried out a wide promotion of the therapists’ app because it is still undergoing testing. In terms of the timeline, we developed and started testing the children’s app in 2012 and 2013. Subsequently, we carried out all the upgrades in 2014 and separated the content between the children’s app and the therapists’ app. We have been testing the pilot release of the therapists’ app, while the children’s app is in its second stage of release and has been downloaded in 15 countries so far. Q: How does Smile Train fund its initiatives and charity activities? PS: Smile Train values and prioritizes the use of technology to help children around the world. From our operations’

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| VIEW FROM THE TOP

KEEP IN TOUCH, STAY IN CONTROL PABLO PANTALEONI CEO and Founder of Medtep

162

Q: What opportunities does Medtep see in digital health

has sparked apps related to healthcare and wellness that

in Mexico and worldwide?

could provide valuable information for physicians about

A: Digital healthcare is one of the market segments

their patients.

that has been growing the most in the last three to four years, with extraordinary development in recent months.

We offer treatment plans for physicians to give to patients.

Healthcare and education are the two sectors with the

Through agreements with medical societies and reference

most promising opportunities because they suffer from

medical institutions, we ensure validations of all medical

inefficiencies. In Silicon Valley, we see many initiatives

content and our platform can cover treatments for any

in digital health and the Mexican market enjoys unified

disease. Our app also has a high degree of personalization,

information systems so technology can close many gaps

meaning physicians can adapt the treatment plan or

in the country. One of the main drivers of this trend is

create a new one according to the requirements and

the global economic crisis leading governments to reduce

needs of each patient.

expenditures. The implementation of technology is lagging in healthcare, but those solutions that have been

Q: What impact has Medtep had in both Spain and the US

introduced to the sector have produced excellent return

since its foundation?

on investments. We expect to see more applications in

A: The company was founded in Spain as an initial step

this area in the future.

to do some pilot tests at the lowest cost possible and then it was scaled up. Medtep was moved to the US last

Perfect timing does not exist in this market, it is difficult

year, with headquarters in San Francisco and offices in

to predict acceptance of this type of technology. We

Barcelona and Mexico. The company is growing through

have a hand in three very different markets. The US is

strategic alliances in the US and we have seen the greatest

mature and we have many competitors, but the market

growth of our operations in Mexico in recent months. We

is not saturated. It is dynamic and has the ability to

have operated for a year in Mexico and we already have

reinvent itself frequently. Medtep knows the European

some projects with pharmaceutical companies, insurance

market perfectly, and it is extremely segmented across

firms, and the government. We are planning to further

the biggest three markets in the UK, Germany and Spain.

expand this year and invest more resources to support

Mexico was chosen as the most relevant country in Latin

our growth.

America and as the first step toward penetrating the region. This market needs our health planning technology

Q: How does this tool improve treatment adherence?

urgently and we have already witnessed digital health

A: Patient adherence is perhaps the most important area

success stories.

of opportunity for digital health. Many entrepreneurs are obsessed with getting more clients, users and sales,

Q: Can you provide a technical description of your

but this is pointless if the actual value of the tool is not

services?

authenticated.

A: Our services represent an excellent way to follow

improving patient outcomes. We have conducted clinical

up with patients’ treatment. Physicians prescribe diet,

trials for hemophilia, asthma and borderline personality

exercise or medication for a certain period or for the

disorder. The study for hemophilia found that patient

rest of a patient’s life, but they can run into difficulties

adherence improved 60 percent with savings of US$5,300

following treatment. Our platform provides patients with

per year. We are focused on validating this tool in our three

the opportunity to keep in touch with their physician

markets. In Mexico, we are managing a plan for obesity

and control their disease. Physicians rarely know exactly

alongside medical societies and the government. We are

what patients are doing outside the consultation, which

also developing a treatment plan for respiratory diseases.

We

are

completely

oriented

toward


Q: How are you combatting resistance from technologyreluctant physicians and educating patients about these tools? A: Physicians do not always welcome new technologies when first introduced to them. They realize through using the tool that it simplifies following up with patients instead of representing more work for them. This tool can

“Our growth will be sustained through collaborative efforts with telemedicine firms and wellness companies” Pablo Pantaleoni, CEO of Medtep

reduce the number of phone calls and emails from their patients, diverting follow-up through the platform where everything is automatic. This kind of application is not for

in Mexico in the short term. Most of our Mexican projects

everyone but the acceptance among physicians has been

have started in Mexico City but we are running some pilot

excellent. We proudly discovered that age is not a limit

tests in rural areas where we see plenty of opportunities.

for the platform since we have seen both young and older physicians using it. This can differ in patients and depends

Q: What do you feel led you to receive the ‘30 under 30’

on the treatment they are receiving. Young people

award from Forbes?

between the ages of 13 and 25 are using the hemophilia

A: There are few Hispanics on the list and I see this award

solution, while our COPD users are above 50 years old.

as recognition for all the members of Medtep’s team. The award also reflects the trust of the American market in

We are engaged in training and educating patients on

our operations and the expectations of our customers

these kinds of platforms and tools. The development of

and investors. We want to continue capitalizing on the

the platform was a joint effort with both physicians and

many opportunities in digital health and try to reach as

patients. Patient associations, having been told about the

many people as possible. There are plenty of ways to

platform, are interested in receiving more information

collaborate with new industry players and we are open

and frequently contact Medtep. This is valuable for rare

to do so.

and chronic diseases, for which follow-up and treatment adherence are critical.

Q: What else do you envision for your company’s tools in Mexico in 2016?

Q: For which other diseases do you want to create

A: Medtep was founded in Spain but moved to the US

platforms?

last year. Our headquarters are in San Francisco and

A: We are focused on rare and chronic diseases and

our offices in Barcelona and Mexico. We are growing

there are many yet to be explored. We are also tapping

through strategic alliances in the US and we have seen

into mental health and prevention. The latter will not be

the greatest growth in our Mexican operations this last

a wellness app but a treatment plan to prevent diseases

year. We already have some projects with pharmaceutical

or their progression, such as pre-diabetes. We want our

companies, insurance firms and the government. We are

platform to be the basis for the development of many

planning further expansion this year and to nvest more

more treatment plans, and to stay as flexible as possible so

resources to support our growth.

that any healthcare practitioner can develop a treatment. This opens up many opportunities, and our growth will be

Our platform could be an exceptional tool for research

sustained through collaborative efforts with telemedicine

in clinical trials as it keeps a record of the lifestyle habits

firms and wellness companies. We are collaborating with

of patients. We have worked with the pharmaceutical

telemedicine companies so that physicians can follow up

industry but not during clinical trials per se because there

with patients after diagnosis through our platform.

are many good systems and competitors and we are not limiting ourselves to just one kind of segment or clinical

Q: How do you expect telemedicine to transform

application. The platform is flexible and open for use

healthcare in areas with few hospitals and limited

throughout patients’ treatment.

medical attention? A: I am completely certain that we have only seen a small

We

part of the great potential of telemedicine. Many doctors

establishing more agreements and creating synergies

still think they need to have contact with the patient to

with companies. We also aim to scale up the pilots that

examine him or her but a plethora of medical visits are

are already running in the country, which will be achieved

not necessary, they simply consume time and money

with the help of exterior units to gather evidence of the

that is limited in these communities. Follow-ups through

functionality and effectiveness of our platform. We will be

telemedicine platforms are effective and they are growing

investing significant resources this year and in 2017, which

significantly. I am optimistic that we will see this booming

will also contribute to job creation in Mexico.

want

to

consolidate

our

commercial

position

163


| VIEW FROM THE TOP

CONNECTING PEOPLE AND INFORMATION ROBERTO TAPIA Director General of Fundación Carlos Slim

164

Q: App-prende was recently released as a platform for

how these applications are useful for people’s daily lives.

teachers, students, parents and the general public. In

The bulk of access has been through the online platform,

what ways will it impact the health industry?

yet the smartphone growth in the market is increasing.

A: The app, app-prende, also found online as aprende. org, has three main components. The first is aimed at

Q: How does Fundación Carlos Slim collaborate with the

strengthening content to ease the learning process for

public sector to achieve its goals?

students in areas such as math and science, particularly

Universal health coverage is one of the most relevant

in elementary and middle school. The second provides

topics in Mexico. Fortunately, the Health Ministry is

training for high-demand employment from technology

striving to expand their system through solid actions. We

and food production to other service areas. The point is to

collaborate with the institution to implement our non-

make courses available for anyone, no matter their level of

communicable disease (NCD) program Casalud, which

education, which can connect them to the job market and

looks at re-engineering the first level of attention. Our

improve labor opportunities. Self-employment is promoted

philosophy emphasizes the importance of strengthening

as well, as we offer training courses such as beauty salon

the foundation of the health system.

management. The third element we offer concerns health. The app provides easy to digest information created for

Technology allows us to start all of these projects as we

the general public. Navigation allows people to reach

collaborate with public institutions that are promoting

everyday information through video lessons related to

our program nationally such as MIDO, an integrated

basic information on areas such as skin care, tattoo care

measurement for opportune detection of NCDs. The

and bullying. Plus, the app and website provide calculators

project

that can provide measured information like the Body Mass

diabetics, pre-diabetics and those free of chronic illnesses.

Index (BMI).

We are finding that the exam can be applied to people

implies

entering

communities,

and

finding

on the street in only nine minutes. It allows us to do a The Foundation deeply believes that health is a shared

preliminary evaluation and find unaware pre-diabetics who

responsibility between the individual and agencies that

can benefit greatly from our guidance. Lifestyle changes

can provide support in case of health loss. However, people

are essential to avoiding diabetes and can improve the

should not wait till they are ill to take care of themselves

life quality of many people at risk. We find that half of

and should prevent as much as possible. App-prende is

diabetics are completely in the dark about their condition

informative, preventive, educational and accessible. The

while the other half, aware of their condition, are not

platform is completely free to all Telcel users as there is no

taking care of themselves adequately. The latter can cause

charge for navigating the website.

eye, circulatory and kidney damage.

It was created with the Foundation and Carlos Slim’s

Another program being developed is based on paradigms

philosophy, which emphasizes the importance of taking

that worked for infectious diseases and that need to be

advantage of the information era and its ability to eliminate

modified for chronic diseases. Health units that focus on

access barriers through connectivity.

obesity and diabetes need their patients to be monitored and not just tended to for a specific period of time. The re-

Q: What are the target audience goals for the app?

engineering of the system is then coupled with technology.

A: The idea is to reach millions and to continue promoting it.

Mido Mi Salud is an app that was developed to promote

In the first week we were able to reach thousands. Growth

the fluidity of communication between the patients and

has been quick and it is already positioned as a high-level

service providers. Treatment and medicine follow-up will

app. The number of downloads gives us a good sense of

be easier.


| VIEW FROM THE TOP

HEALTH INQUIRIES, THE DIGITAL WAY JAVIER CARDONA CEO and Co-founder of 1DOC3

Q: Under what circumstances was 1DOC3 founded and

properly update current policies. Our platform also serves

what were the market opportunities you visualized to

as a digital channel for healthcare authorities to reach

start the company?

consumers. We work closely with other health institutions

A: Four years ago, while living in the Middle East, I suffered

to prevent the zika and chikungunya virus spread through

a serious injury. I did not know where to find a doctor in

content-based campaigns.

Dubai, so I searched online with little success. Thereafter, we came up with the idea of creating a platform similar

Secondly, we work with the pharmaceutical industry in

to TripAdvisor with a health approach, in which finding

two ways. We carry out disease awareness campaigns

physicians with excellent credentials would be easy. We

for companies like Novartis. Our job is to disseminate

realized rating doctors with stars was not the best approach,

information about Alzheimer’s, multiple sclerosis and

as fatalities can happen and grades could become biased.

other relevant diseases. We also deliver reports on people’s

We kept evaluating people’s Internet habits and found out

beliefs about certain health conditions in specific regional

that almost everybody googled their inquiries. As such, the

contexts, which can be structured by topic, gender, age

question-answer mechanism connected worried would-

and health condition, among other categories.

be patients with physicians lacking an online presence. Our platform was born as a medical recommendation site

Finally, health insurance companies are 1DOC3’s third

that became a place where people could get accurate

business line, as we serve as a first filter to their clients.

answers from real doctors, while the latter earned a digital

Many medical consultations are just informative; our

reputation.

digital platform can solve some of the enquiries before an insured patient visits their physician.

Q: How does 1DOC3 work and what are its main differentiators?

Q: What kind of growth has the company seen?

A: 1DOC3 is a multichannel platform that can be accessed

A: We launched our platform in June 2014. Since then, we

through our webpage, mobile applications developed for

have oriented 17 million Latin American people, half of them

both Android and iOS systems, SMS, and through Internet.

in Colombia, and 20 percent in Mexico. We have grown in

org. In Mexico, it’s already available on Telcel, allowing

an organic manner, without major marketing investments

people to use our service even without a balance on their

and through good positioning in online search engines.

account. 1DOC3 is quite easy to use. People simply write

We have close to 3 million users in Mexico so we decided

their questions and the system looks over the 100,000

to open local operations. Mexico is the largest market we

inquiries that have already been answered. If you want a

could aspire to reach in Spanish-speaking countries.

personalized answer, the system detects the type of doctor that should be answering the question. In an average of 90

Q: What can you tell us about the endorsement by the

minutes, users will get a concise answer. Our platform is

Inter-American Development Bank (IADB)?

not a medical chat, it is asynchronous.

A: The IADB named 1DOC3 as the startup with the highest social impact in Latin America for 2015. The institution’s

Q: Who are your main clients?

endorsement has helped us validate our operations with

A: We have three main clients. Firstly, we provide the

governments and other authorities. In February 2016, the

Colombian government with general information, helping

bank released a paper that showed how a startup like ours

them build and update public health policies based

aids governments in reducing communication campaign

on in-depth reports containing the general public’s

costs. The cost difference between reaching 10 million

most common questions and concerns. With this data,

people through a push approach, rather than through

authorities can improve education, training manuals and

online searches, is phenomenal.

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| VIEW FROM THE TOP

CONSULTATIONS CLICK ON IN DIGITAL ERA ALEJANDRO DE LA PARRA Director General of Astrum Salud

166

Q: What are the main advantages and disadvantages

Our solutions encompass these three benefits of digital

of digital health for the patient and how can it improve

health, as we are complementing our teleconference

patient outcomes?

services with a series of mobile apps focused on attending

A: Patient information security is an extremely important

health concerns separately. We provide relevant software

issue when speaking in terms of global healthcare. As the

solutions, one of which is an app that reminds people to

digital health era extends its reach, offering solutions to

take their medicine, thereby contributing to medicine

almost every corner of the world, the new health paradigm

adherence. We aim to combine our telecommunications

contributes a myriad of benefits. Technology can support

platform with our mobile development, to create a fully

both health professionals and patients to give and obtain a

integrated solution.

reliable medical service when handled appropriately. Q:

How

does

the

technology

support

healthcare

A solid digital health infrastructure eases communication,

providers?

as well as remote patient monitoring. Mobile technologies

A: Our technology provides treatment beginning with an

have established robust wireless solutions, wearable

initial consultation at an online pharmacy, generating a

technology and mobile devices that automatically keep

digital prescription. The teleconference business model

records of monitoring. Keeping patient records for on-

offers patients the ability to purchase time blocks within

demand cloud access empowers the healthcare and assists

a doctor’s calendar, which makes scheduling easier for

care providers across medical disciplines. This saves time

patients and doctors. Patients pay a lower fee for medical

and money. In Mexico, this is essentially groundbreaking

consultations, while doctors increase their earnings as

as the public has almost no access to their personal health

they can charge more for 15-minute appointments than

record. As most rural areas suffer from lack of access to

their typical hour-long consultation.

quality medical services, digital solutions can be a barrierbreaker as telemedicine and teleconference in particular

We are opening our technology to different sectors,

offer the ability to close that gap. As elderly, disabled and

such as education, legal advice and financial advice, to

remotely located patients struggle to attend a doctor’s

complement our medical solution. This year, we aim to

office, our model facilitates patient preparation, treatment,

build a complementary solution for general doctors,

second opinions and follow-ups.

psychologists and nutrition professionals to incorporate technology into their processes. We are also launching

“As most rural areas suffer from lack of access to quality medical services, digital

online courses related not only to health but also business and sustainability to empower the digital era in Mexico and Latin America. Our goal is to provide intuitive digital tools attuned to our society’s healthcare system. Q: How can you ensure that diagnosis is as accurate

solutions can be a barrier-

online as in person to the extent that a prescription can

breaker as telemedicine and

A: Our services for providers are by invitation only. We

teleconference (...) offer the

be given? cannot offer a digital office for someone who does not meet our strict credential validation, in addition to completing

ability to close that gap”

our training sessions before attending patients. Not every

Alejandro de la Parra, Director General of Astrum Salud

are distinct situations wherein medical tests can provide

medical consultation can be conducted online, but there


support. The decision to treat a patient from a distance

as we can contribute to governments saving money on

has to be that of the medical provider and patient. Both

disease prevention and facilitating medical consultation.

will discuss whether the treatment is suited to remote care. We contribute to preventive spaces for health-

There is a blurry regulatory framework at the moment

conscious individuals and on patient follow-up, which do

but data protection laws do apply to our technology, and

not necessarily require patients to be present. A study

we comply with them in their entirety. We are exploring

conducted in the US of these types of services confirmed

regulatory options alongside the government to generate

that patients believe that online therapy is almost as

a new law-abiding protocol for such technological

beneficial as face-to-face appointments. A great number

implementations. It is our job to ensure that medical

of diagnoses can be carried out without the doctor ever

professionals reach certain standards. There have been

coming into contact with the patient.

some important data breaches in the US, such that we are closely monitoring and updating our encryption

Q: How do you ensure your physicians have had the

standards. This requires us to work hand-in-hand with

correct digital health training?

medical providers and patients to reinforce the importance

A: We are incorporating our technology into university

of data security in their day-to-day operations as we all

programs, helping professionals acquire the skills to

incorporate digital technology. This is a collaborative

operate online. Our requirements for becoming an

effort, as all high-impact industries understand. The

Astrum

robust

success of our technology is undoubtedly a matter of

background checkups, as well as confirming their medical

education and although we can identify mistakes in past

training. We are carrying this out manually, but we are

implementations, these are far from being considered

imitating regulatory authorities as they incorporate

failures. They are part of the learning curve.

digital

digital

healthcare

infrastructure

into

provider

their

rely

on

operations.

Besides

technology adoption, there are doctors who already

Q: What are your main priorities for 2017 and beyond?

offer consultations over platforms such as WhatsApp and

A: In 2017, we aim to prioritize education, health and

Skype so bridging the gap is easier. These efforts support

social development through the data we receive from

the process as adoption of Astrum’s technology grows

our technology. Our company hopes to incorporate

organically.

the social media factor into technology development to enrich our users’ experience while learning what

Q: How are you expanding your market within rural areas

people want from our solutions. We are moving into the

to ensure connectivity that will allow communities to use

non virtual digital realms, where massive events hold

your products?

a strong position. Sports, science fairs and continuing

A: We recognize the issues surrounding connectivity.

medical education through seminars and congresses

As

complement our online solutions.

we

are

not

telecom

hardware

manufacturers,

we see the need to collaborate to solve this shared predicament. Social entrepreneurship combined with

For the next five years, our goals are to provide an

telecommunications is already an emerging trend for

integrated IT solution moving into Artificial Intelligence.

business and we envision healthcare in that interaction.

We aim to integrate our content and technology into

In Mexico, people with low incomes are increasingly

university courses throughout the Spanish-speaking

acquiring technology to access the Internet and interact

community, as well as joining forces with our Brazilian

on social media. Mexico has seen some impressive

and Portuguese colleagues to produce similar solutions

developments in telecommunications, following the entry

in their language. We hope to provide a complete

of AT&T for example. Where the population demands

content delivery infrastructure, where we can provide a

sophisticated connectivity, pricing is inevitably catching

one-stop marketplace for health and medical science for

up and attuned to local needs. Our focus is on private

all our users.

medicine, followed by exploring the public health sector once we lower our costs even more. We face a serious problem in Latin America with technology adoption, but are confident that these issues will be solved as the cost of telecom infrastructure drops. This paves the way for cheaper and better technology. The rising importance of telecommunications and its impact on business demonstrates that our service is one of the most economically viable projects that exist today,

US study confirmed patients believe that online therapy is almost as beneficial as face-to-face appointments

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| VIEW FROM THE TOP

GOOGLE GLASS APP VIRTUALLY GUIDES IMPLANT SURGERIES XAVIER BOADAS International Department of Avinent

Q: How has your collaboration with Google Glass

technologies such as guided surgery or customized

influenced surgical procedures?

prosthetics are applied. These recent medical advances

A: The development of Avinent App for Google Glass

could make it possible to plan a surgery virtually.

has been a fantastic tool to show how technology can

168

improve our sector. The app is ready to use and can be

Q: How important is Mexico in the trend toward dental

helpful for doctors during surgery. It guides them step-

medical tourism?

by-step through the surgical procedure. The application

A: Mexico is one of most important markets in which

works with a QR code attached inside the packaging of

we have to invest. We are starting with Colombia, and

an implant that when detected, automatically leads the

Mexico will be the next step for us. Another reason for

doctor through the appropriate drilling protocol.

this is that we are already well positioned in Canada and beginning operations in the US. It makes sense for us

Avinent has contributed to new developments, having

to enter Mexico in the very near future. The size of the

created an innovative implant system to which new digital

market is a contributing factor, since it is the largest in

| INSIGHT

DIGITAL TOOLS STREAMLINE CLINICAL TRIAL PROCESSES ANA PULIDO Director General of Digitalizatxt

developing the trial master file solution. It is important to highlight that our solutions are integral and interoperate among them meaning our customers do not have to deal with individual tools.” Integral solutions allow users

Even though IT tools serve a broad spectrum of areas in

to have access to information on all platforms instead of

different industries, Mexico’s clinical research segment is

importing and exporting data from one platform to the

still highly under-attended. International CROs are forced

other. According to Pulido, this is a software solution that

to bring solutions from foreign providers as there are no

uploads data to the cloud instead of relying on a server

local digital and electronic solution developers for Case

so customers do not need to invest in sophisticated,

Report Forms and clinical trial management systems

expensive

(CTMS). This is mainly due to local authorities requiring

technology

paper records of all data generated by clinical trials. “Users

worldwide. If appropriate security measures are taken

are continuously seeking solutions that can adapt to study

to protect confidential information such as clinical data

requirements so we develop specific solutions for them

companies become more competitive as they can focus

including support and training,” says Ana Pulido, Director

on their core activities and avoid maintenance of expensive

General of Digitalizatxt. International platforms often

hardware, software, IT staff and infrastructure. Companies

require stable and innovative infrastructure in the clinical

can save up to 30 percent with digital solutions and even

site to run effectively. However, this is not always true for

if the set-up cost can represent a significant investment

all clinical sites in Mexico.

for them relying on paper can be more expensive in the

infrastructure is

gradually

and

technical

replacing

staff.

electronic

Digital systems

long term, considering time, quality and productivity. Data “The development of the eCRF took us two years,

analysis is much easier when the information is generated by

electronic data transfer (EDT) one year and the CTMS

clean and organized digital sources, which improves decision

is taking us three years,” says Pulido. “We are also

making and data integrity and reduces approval times.


Latin America after Brazil. Dentistry in Mexico is highly

Q: How is your registration with COFEPRIS progressing?

qualified and competent. Many doctors from the north

A: We are still at the very beginning of the process.

of South America studied at the National Autonomous

We have held some meetings and our product was

University of Mexico (UNAM), which trains high-quality

well received. COFEPRIS does not provide information

professionals. Doctors from Colombia, Ecuador and

directly, it is received through third parties and we have

Venezuela study in Mexico due to the excellence of its

already heard some good news. Having FDA approval and

institutions. Our product is aimed at professionals that

approval in Canada and Japan will certainly help to speed

want a high-quality product, which is why Mexico is an

up the processes.

important market for us. Q: What opportunities do you see in Mexico? Q: What are the biggest differences you have seen

A: This second registry with the Mexican equivalent of the

between Mexico and Colombia?

FDA is an opportunity. When we return to Barcelona our

A: Colombia will be a lucrative market for us as it has

regulatory affairs department will study strategic ways for

qualified dentists and, because aesthetics are trending,

us to enter the Mexican market. We also have the help of

odontology is a way to tap into that market.

the ACCIÓ office (Catalonia Investment and Trade Agency) here in Mexico. Even with all this support, we expect it to

We are seeing this trend replicate itself increasingly in

take nine or 10 months to obtain approval. Although we do

Mexico. People want functionality and those that require

not plan to manufacture our products in Mexico, I cannot

intensive dentistry work want teeth that fit well and are

make that as an unequivocal statement as we do not know

aesthetically pleasing. The population is more familiar

how customized products will be classified by customs. It

with implants and their purpose and functionality as

may become necessary to produce them in the country for

information is readily available for everyone.

local sales.

For Mexico to reach its full potential in the digital

As a consulting company for IT solutions, Digitalizatxt

healthcare field, authorities still need to modernize their

has several business units including Naat Solutions,

processes and requirements. “Regulatory authorities

Naat Health, Naat Knowledge, and Naat Mobile. Naat

still ask companies conducting clinical studies to keep

Solutions and Naat Health are dedicated to clinical

physical records of clinical data,” says Pulido. She

research and provide solutions such as the eCRF and

adds that a shortcut to a better competitive position

the CTMS. Naat Knowledge is focused on training for

in the healthcare and life sciences sector consists of

several sectors such as finance, education, medicine

incorporating digital solutions that help processes be

and law, among others. It consists of a learning platform

quicker, safer and more reliable.

for online programs. These platforms help save costs associated to logistics, and transportation incurred by

A number of companies have tried to enter the electronic

companies interested in training employees in different

records market in the last three years but only now

cities. According to Pulido, when employees are trained

is the business opportunity attractive. “In the past,

by different instructors they do not receive the exact

many companies used to see digital technologies as an

same information, which is something that can be

unnecessary expense but they are becoming aware they

avoided with online platforms. As for Naat Mobile, it

need to adapt to this global trend,” says Pulido. This digital

enables customers to have a broad range of educational,

platform already has been used by several CROs with

entertainment or business solutions in their smartphone

favorable feedback.

or tablet, which is also an important trend today. Business people spend much of their time travelling and the use

There are still many gaps to be closed in the clinical research

of mobile technologies has become quite popular and

industry such as eliminating manual data manipulation

useful for business management. Digital services are

because it can take weeks to transfer information from

changing the way companies develop new drugs in

devices to electronic databases. But the EDT solution can

terms of time and patient empowerment. Future plans

reduce the work of an entire week to three minutes. “Our

of Digitalizatxt include a patient diary where information

clients have become aware of the benefits of these tools.

regarding medicine intake and lifestyle changes can

But greater effort is needed to explain the importance of

be uploaded. “We expect digital healthcare to greatly

optimizing processes with the aid of digital solutions,”

increase in the next five years and we want to be there

says Pulido.

when the market starts booming in Mexico,” says Pulido.

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| VIEW FROM THE TOP

TEXTING FOR HEALTHIER BEHAVIOR JAIME ARCHUNDIA Innovation lead of UNICEF

170

Q: How is UNICEF’s partnership with the Mexican

RapidPro tool helps us obtain information from the

government contributing to the Prospera Digital strategy?

beneficiaries, which assists us on the catering of specific

A: The Prospera Digital strategy we are working on targets

solutions for their needs. For instance, we ask mothers

mothers and pregnant women. For Prospera Digital,

with babies of breastfeeding age how many times a day

UNICEF provides our rapid growth technology and original

they breastfeed their babies or how many times a day

content we have developed on breastfeeding, early child

they change the baby’s diapers. If we notice that it is less

development, signs of concern during pregnancy and so

than eight times we can allocate them to a group that

on. UNICEF has developed a technological tool called

has low rates of breastfeeding and we begin a process of

RapidPro, a development app we use for different kinds

sending messages that try to reinforce the importance of

of interventions and to create information flows from

breastfeeding and then track their progress.

and for people. Our experience on Communication for Development (C4D) and our technology is what makes us

The second treatment group receives the same kinds

an invaluable partner for the federal government on the

of messages but we also send messages to community

Prospera Digital strategy.

health promotors that participate with Prospera. We ask them to reinforce the messages the women in

The content we provide is designed jointly with users. We

their communities receive through their phones. These

conducted ethnographic research with the beneficiaries of

community health promoters also have the capability

Prospera, going to several communities to identify which

of sending more messages to the pregnant women that

were the main obstacles they faced in terms of healthcare.

help with reinforcement of the message we are sending.

Most of the time, the obstacles they face are related to

It is a mobile initiative with a strong health community

the long distances they have to travel to get to the closest

component aimed at reinforcing information.

health clinic. Sometimes when they have an emergency it takes them three or four hours to get to the clinic. Another

The third treatment group also receives the messages

difficulty they face is at the moment of child delivery.

but the mothers are also able to assess the quality of

Sometimes a women will get to the clinic but because she

the healthcare they receive in the clinics. The women

is not that far into labor she has to wait and is sent back

are asked for specifics regarding the attention they have

to her house.

received from their doctors and the treatment they need depending on their pregnancy stage or their baby’s age.

Prospera’s beneficiaries are a vulnerable group and

With this information we are able to shorten the route

unfortunately they suffer from the highest rate of stillbirth

of accountability, in which beneficiaries are directly able

and of high maternal mortality. Based on these situations

to evaluate the quality of the service they receive. With

we decided to create this intervention, working with the

all the information we gather we try to allocate positive

Mexican government and its National Digital Strategy

incentives for doctors’ good work, such as extra vacation

office. They provided us access to Prospera and to the

days. Our control group is also with Prospera beneficiaries

Ministry of Health.

but they are on the traditional Prospera plan and only receive their conditional cash transfers.

RapidPro has three different treatment groups and one control group. The first treatment is focused on sending

There are 3,000 beneficiaries on the three treatment

messages with content aimed at changing beliefs,

programs and 3,000 on the control group. Our 6,000

attitudes and practices during pregnancy and identifying

beneficiaries are being treated at 655 clinics. We are

different signs of concern. Our interaction goes beyond

deploying the program on the states of Mexico, Chiapas,

sending push notifications, or one-way messages. The

Hidalgo, Puebla and Guanajuato. These five states were


chosen because they present a mixture of the different

where we invite pregnant women to participate. In the

conditions in Mexico and because they present a high

workshops the team implementing the program explains

ratio of maternal mortality rates. With this information we

how it works, how to use their cellphones and if they do

will obtain data that will inform us on the scope of the

not have a phone we provide them with a basic cellphone.

program and after the implementation of the program we

We have found that in the first four months participation is

will have outcome results from the impact evaluation.

high because it is something new and they are enthusiastic.

The messages we send to all treatment groups cover an

Around 45 percent of the women who participate are

array of topics such as prevention during pregnancy, labor,

23 years old or under. Our strategy for maintaining the

breastfeeding, early child development and content to

participation rates of this particular group after the first

prevent accidents during the first two years, all aimed at

four weeks is to create Facebook Messenger multimedia

changing the mother’s behavior. The messages also ask

content. It is a strategy that we believe will increase

them if they know where their nearest clinic is and how are

participation rates. Our Facebook page also is filled with

they planning to get to the clinic when their baby is born.

interesting content created by UNICEF, the Ministry of

We ask them to design a plan for their delivery day and

Health and our partners regarding breastfeeding, child

a back-up plan for that day. We also ask them how much

development and anecdotes from people who have used

money they believe they are going to spend on delivery

the program. The goal is to make the program personal for

day and provide them with a money-saving plan so they

all the women who participate.

can have funds available when the time comes. Q: Which alliances did UNICEF forge to develop the Q: What participation and engagement rates are Prospera

program?

Digital seeing?

A: The President’s office as well as representatives from

A: The project was launched last December and we are

the National Digital Strategy helped us with the process of

still going through the implementation process. It has

bringing together private sector players. The equipment

been going for around seven months. In the next two

or hardware we give the women is provided by Alcatel

months we will have the first preliminary results and

and Samsung. Telcel and Movistar Telefónica are helping

at the end of the year we will get information on how

us with the text messaging. Telcel gave us 2 million free

the program is changing baby’s sizes at birth, weight,

text messages for an eight-month period and Telefónica

height and Apgar scores. Those are our final outcome

gave us 6 million free text messages for one year. Their

outputs. The midterm outcomes we have been tracing

participation has been crucial for us. That is why the

are engagement and participation rates. Our latest

partnership with Facebook is so important. Its Internet.

measurement shows an average engagement rate for our

org can definitely help us to achieve our goal of carrying

three groups of 87 percent.

information to a population group that has no access to other mobile technologies.

We send different kinds of messages. Some messages only provide information while other messages are questions designed for us to collect information so we can cater options to that mother’s specific needs. Our participation rate is based on the response to those questions. There is an average response to 85 percent of the messages we send. The preventive messages also have two variants, the informative ones and the ones that look for a response. With those messages we have a 70 percent response. For the messages we send that are looking for warning signs we receive around an 87 percent response. The messages asking for the quality of the healthcare they receive are having an 80 percent response. Our messages receive high response rates at the beginning but the engagement levels tend to decrease as time goes by. We are working on ways to maintain the participation rates. Prospera beneficiaries have to attend different workshops as part of the conditional cash transfers they receive and one of those workshops is Prospera Digital,

There are 3,000 beneficiaries on the three treatment programs and 3,000 in the control group. Our 6,000 beneficiaries are being treated at 655 clinics

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| VIEW FROM THE TOP

TECHNOLOGY INCENTIVIZES HEALTHY LIVING FOR DIABETICS GABRIELA ALLARD Director General of Mexican Diabetes Association

Q: What new efforts is the Mexican Diabetes Association

by a small percentage of the population but we will create

developing for diabetes awareness programs?

other platforms for more people to have access to these

A: Our main objective today is education so a factual

courses.

change can occur in society. We cannot put the solution

172

to diabetes in the hands of anyone else but the patient.

Technology plays an important role in healthcare, and this

Therefore, we created a new app that provides educational

app was fully developed by us with funding from Fundación

content about diabetes that can be downloaded with a

Chespirito and Boston Scientific. The app takes the user to

basic Internet connection. The information covers nutrition,

a webpage called Pacientes Como Yo (Patients like me), an

self-monitoring, exercise and the emotional management

online community in which patients share information on

to follow a successful treatment. We do not only want to

diagnostics and treatment, which is supervised by experts

provide information but we also want to transform lives

from Boston Scientific. We want patients to be proactive and

through education. It is true that physicians sometimes do

participate in discussions about their disease. It is important

not have time to educate patients so these tools are not

to highlight the app is not intended to either measure

meant to replace medical care but to help patients control

glucose or keep a food journal. It only has educational

their own condition. We are aware the app can be reached

content for diabetes type 2. Nonetheless, we will also cover

| VIEW FROM THE TOP

LEVERAGING BIG DATA FOR BETTER HEALTHCARE GUILLAUME CORPART Managing Director of Global Health Intelligence

Q: Global Health Intelligence has a focus on emerging

in Brazil than in the US, a whopping 7,000, while Mexico

markets. Why is it particularly interesting in Mexico?

has nearly 4,000. Together Mexico and Brazil account for

A: Emerging markets abroad are an attractive focal

two-thrids of Latin American hospitals. Consequently,

point thanks to their growth perspective. The healthcare

any business that wants to compete seriously in the

industry is expected to grow two to three times faster in

region must participate in these two countries. With this

emerging markets than in developed economies between

perspective, Latin America is a huge healthcare market

now and 2017. Any mature business that is striving to

that has been sidelined by many multinationals for the last

grow in global markets must plunge into the emerging

20 years.

market playing field. With that being said, Latin America differentiates itself with a large population, 625 million of

Q: How does GHI collect data in the region and specifically

which about 128 million live in Mexico.

in Mexico? A: We use health demographics to map hospital penetration

We are particularly interested in the fact that the Latin

across the region. We cover 11 countries, with 12,000 of the

American market has a complex healthcare system in which

region’s 16,000 hospitals. As a result, GHI has developed

there is no standardized government metric for measuring

the world’s largest hospital demographics database

hospital demographics. The region has 16,000 hospitals in

focused on Latin America. All data is collected, verified

total, more than all of Europe. There are more hospitals

and distributed by GHI. We have a call center and research


diabetes Type 1 and prenatal diabetes in the future. We are

glucose 8-10 times per day. Achieving this in the public

going to measure the acceptance level of the app among

system is not easy. Diabetes Type 1 is a catastrophic disease

the population and we will subsequently do the necessary

accounting for up to 30 percent of the total income of a

improvements. We are continuously looking for sponsors for

family and the industry is highly committed to supporting

the app and we are talking with several potential sponsors.

this initiative. Other Latin American countries such as

Many people are stuck in the same speech and activities

Argentina, Chile and Uruguay already cover full treatment for

around diabetes so we wanted to create something

diabetes Type 1. Glucose monitoring is also important during

innovative that could have a significant impact with the aid

pregnancy because women’s health can be endangered and

of technology.

babies could be born with many health problems.

Q: What concrete public initiatives have you supported to

Not all associations achieve tangible results or remain

improve patients’ quality of life?

active over the years. Sometimes we blame the Ministry of

A:

Patients

need

to

understand

they

can

prevent

Health or the Government for the populations’ health and

complications, and handle acute situations. The obligation

we are not assuming any responsibility ourselves. Diet and

to provide education to patients has been left entirely to

healthy habits are an individual choice so we have to work

physicians, the government and sometimes the industry. As

in conjunction with more parties to establish this mindset

a civil association we are also responsible for this. Treatment

with interesting initiatives to start making a change in

for diabetes Type 1 is not guaranteed in public institutions

society. In the Mexican Diabetes Association, we aim to teach

so we created an alliance with Fundación Mídete, Fundación

patients how to live healthy despite their condition, which

Fine and others, and submitted an initiative to the Senate

subsequently gives them hope and the power to manage

for children to have access to full treatment for this disease

their own health. Chronic diseases are difficult to bear

in public institutions. Some of them are already providing

because they affect quality of life for the rest of people’s

treatment but they do not cover auto-monitoring, which

lives. Patients feel good one day and the next day they are

is expensive since parents have to measure their children’s

at the hospital because glucose levels can easily fluctuate.

staff in Mexico to handle the majority of this work. The

stroke and diabetes. It is a massive long-term strain on the

first step of the process involves contacting government

healthcare system. Some of these diseases, like diabetes,

ministries across the region to obtain information about

are irreversible and need a lifetime of expensive treatment.

their healthcare network and infrastructure. In most cases, we receive a list of hospital contacts and addresses and

On a positive note, in 2013 Mexico had a diabetes

our call center continues the labor by contacting hospitals

awareness campaign that was the largest of its kind region-

to obtain additional information. We ask 106 questions to

wide. During this event, diabetes tests were provided, as

each hospital, gathering data from the number of beds to

well as information on the importance of eating well and

the type of equipment they use. GHI also delves into the

exercising. The event demonstrates that policies are being

human resource departments to inquire about medical

developed, even if the effects are yet to be seen.

staff and capabilities. Q: How has the government reacted to the incoming It is an incredibly challenging task, yet rewarding as we

reality of an aging population?

see positive collaboration from both hospitals and clients.

A: Latin America has the fastest aging population in the

We anticipate obtaining 85 percent regional coverage by

world. By 2055, the 45 to 60-year-old age group will grow

2017. We support the hospitals that are willing to give us

by 40 percent, while the over 60-year-old age group will

information by sharing information with them regarding

grow threefold. Investing in infrastructure and building

hospital infrastructure development. This is very much a

more hospitals is not an efficient solution due to high

collaborative task.

costs and limited lifespan of the use of infrastructure, much like building a large number of schools at a time

Q: What challenges does the sector need to face to

when people are having fewer children. We have to be

make growth happen in light of the increase in chronic

more innovative. One example is to focus on population

diseases?

health management, focusing on maintaining a population

A: Chronic diseases are the largest burden on the healthcare

healthy rather than on treating the ill. Digital health

radar regionally, and on top of that list is obesity. The

awareness is an element in this equation, which Latin

latter is a precursor to a wide range of complications like

Americans are adopting quite well.

173



CLINICAL RESEARCH

8

Mexico’s strict COFEPRIS regulations, ethnic and epidemiological diversity and relative stability have transformed the country into a burgeoning hub for clinical trials. International drug companies are turning to Mexico and contract research organizations (CROs) are carrying out Phase II and Phase III trials for those that may not have a direct presence. Working on drugs to treat the conditions that plague Mexico, such as diabetes and cancer, companies are working on innovative new molecules, combination drugs, biotechnology and generics.

To improve clinical trial sites, companies are improving compliance with strict regulations, actively seeking to earn certifications and competing to attract and retain medical talent. To do so, many partner with universities and offer internships and training to entice students into a career in clinical research. Despite the advances that have been made and its natural advantages, Mexico only attracts just over 1 percent of world clinical trials. Many industry insiders say further investment and faith in Mexico’s scientific abilities are needed. This chapter provides an overview of clinical research underway in Mexico, relevant regulation, maintaining patient participation rates in trials and other challenges companies are facing.

175


The benefits are in the active substance #ItIsWhatInsideThatMatters Before going to market, generic drugs must meet strict bioequivalency, bio-dissolution and bioavailability tests to guarantee their effectiveness. Bruluart, we believe that everyone is In Grupo Bruluar entitled to a long, happy and healthy life. We are a mexican pharmaceutical group with over sixty years of manufacturing and marketing experience in high quality, affordable medicine.


| CHAPTER 8: CLINICAL RESEARCH 178

ANALYSIS: Mexico Fights for Bigger Clinical Role

180

INSIGHT: Cecilia Moreno, PPD

José Viramontes, PPD

182

VIEW FROM THE TOP: Melissa Rosales, RM Pharma

184

VIEW FROM THE TOP: Cecilia Padierna, LEI

185

VIEW FROM THE TOP: Yomana Khoury, inVentiv Health

186

INSIGHT: Annette Ortíz, EPIC CRO

187

VIEW FROM THE TOP: Israel Vega, PRA Health Sciences

188

VIEW FROM THE TOP: Karen Hahn, ICON

189

INSIGHT: Ciro García, Accelerium

190

VIEW FROM THE TOP: Arturo Rodríguez, Infinite Clinical Research

177


| ANALYSIS

MEXICO FIGHTS FOR BIGGER CLINICAL ROLE As the world´s medical and scientific communities hunt

percent of GDP in 2013, compared with an OECD average

for better and more efficacious drugs, Mexico is fighting

of 8.9 percent.

for a bigger role in the global clinical research sphere. Although dominated by the US, the realm of clinical

Khoury points out that one of the hurdles facing Mexico

research is expanding outward in the drive to bring

in attracting more clinical trials and research is cultural.

needed medicines to the public more rapidly.

Unlike in the US where clinical trials are a familiar force, Mexicans tend to be wary.

Globally, US$28 billion are invested in clinical research annually, according to Arturo Rodríguez, President of

“Culture plays an important role in the way clinical

ACROM and CEO of Infinite Clinical Research. Of that, Mexico

research is perceived among patients,” Khoury says. “In

receives US$200 million and 1 percent of clinical trials.

the US people are (…) willing to participate because they know their safety is never compromised. In Mexico more

178

That’s a small slice of the pie and researchers and industry

education of the public is needed about what a clinical

insiders believe Mexico is primed for a bigger piece. They

study is, how it is regulated, and the benefits. Many

cite a large and diverse population, a new cooperative

patients miss valuable opportunities to improve their

regulatory environment and the potential of the country’s

health due to ignorance.”

human capital. The country’s geography is also playing a significant role “Mexico has a broad patient population, qualified

as it targets a greater share of the clinical research market.

professionals, the right infrastructure, and supportive regulations for clinical research,” says Yomana Khoury,

“While we are officially part of Latin America, our

Manager of Clinical Operations and Strategic Resources

close proximity to the US has enabled our country to

at global CRO inVentiv Health, a worldwide leader in

incorporate practices, processes and procedures that

neuroscience clinical development, having supported

are similar to those of the US, making us familiar and

more than 507 clinical programs in over 60 countries and

comfortable with the way US companies work,” says Jose

over 45,000 patients in the last five years. “Mexico has

Luis Viramontes, Director of Remote Site Management &

reliable, well-trained researchers, and a strong patient-

Monitoring, Latin America, of PPD.

doctor relationship resulting in good compliance and “In practice, for companies having their corporate offices

high retention rates.”

in the US, sharing the same time zone has been a clear Mexico’s population stands at about 128 million, which

advantage to Mexico from a business perspective. Being a

gives it a broad base of potential trial participants and

Latin American country, we also can offer the international

makes it ideal for clinical research. But health spending

implementation of sites that most trials desire.”

overall lags. According to the OECD Health Statistics 2015 report, health spending in the country was 6.2

Cecilia

Moreno,

Associate

Director

of

Clinical

Management, Mexico, CA & Caribbean at PPD adds that

“All medicines can be considered matters of national

there are a number of steps clinical research professionals can take to attract investment.

security. Vaccines reach

“The Minister of Health in Mexico and the COFEPRIS

over 90 percent of Mexico’s

countries and reviewing their regulatory processes

population, having a larger impact on our society in the

are deeply interested in taking the benchmark of other to improve timelines,” she says. “As a country, we are more predictable, which is good for clients. The pharma industry will send more studies to Mexico if they see that the timeframes for regulatory approval are improving.”

event of a quality breach”

Moreno points out that cooperation with government

Cecilia Padierna, Research & Development

regulators has advantages, especially if the goal is

Manager of LEI

improving turnaround times.


“The Mexican Social Security Institute (IMSS) is evolving

population, having a larger impact on our society in the

to change its processes, but only a few clinical trials are

event of a quality breach,” says Padierna. “Another problem

underway so far. Usually the time needed to implement

arises as public health institutions lack vaccine availability,

and conduct a clinical trial is short and IMSS cannot always

which could be the result of providers not delivering

meet those deadlines. We need to continue working with

punctually, a lack of vaccines in their portfolio or COFEPRIS

them to shorten turnaround time as this institution serves

not releasing and distributing them quickly enough. LEI

an important part of the population.”

could contribute to improving these circumstances.”

Melissa Rosales, Director General of RM Pharma, agrees

She expects regulators like the new head of the IMSS,

there are issues yet to be resolved, especially as they relate

Mikel Arriola, to help change the landscape. “We expect

to the difference between Mexico, the US and Europe.

the federal government’s health sector to allocate more activities of this kind to third-party testing laboratories.”

“The timeframes are the main difference,” she says. “We know all randomized studies started in the US, followed

THE FUTURE

by Western Europe. That is a major difference. In the

For some, the future of clinical research is the domain

US clinics have several sponsors. On several occasions

of technology and the people who administer the trials.

because COFEPRIS took a long time to approve

Technology is constantly evolving and has changed

protocols, recruitment was completed by sites in the US

the way we monitor clinical trials and the way data is

and Europe and we could not participate, which reduces

processed,” says Israel Vega, Clinical Operations Manager

our competitiveness.”

at PRA Health Sciences.

THIRD-PARTY TESTING

“The activities of clinical research associates today are

Among the industry’s players, third-party testers say

very different from those in 1999 and 2009. We now

they also could play a larger role in attracting trials.

collect data in real time and share it with the client. This

Those companies add efficiency to the supply chain,

is the future of clinical research.”

support COFEPRIS in medicine and medical device assessments

and

analyses,

says

Cecilia

Padierna,

Behind the technology are the people that implement

Research & Development Manager of LEI (Laboratorios

the plans and carry out the work. “I think we need to

de Especialidades Immunológicas), a third-party testing

work with universities and institutions because many

company.

young people do not know how the industry works,” RM Pharma’s Rosales says.

They can help ease the commission’s saturation but thirdparty companies like LEI have not been able to take part

“They may want to focus only on the clinical side of

in the vaccination sector, which she thinks is an issue.

clinical research, so they may move on to private practice as they do not know what clinical research actually

“All medicines can be considered matters of national

consists of. They need more informative conferences and

security. Vaccines reach over 90 percent of Mexico’s

more training.”

MEXICO A COMPETITIVE PLACE FOR R&D ON CLINICAL TRIALS Country

MEXICO MORE AFFORDABLE DESTINATION FOR PRODUCT TESTING

Savings (percent)

Country

Savings (percent)

Mexico

38.8

Mexico

46.4

Canada

29.6

Canada

27.8

France

27.9

Netherlands

26.9

Netherlands

22.5

Australia

22.8

Italy

19.7

France

21.4

Australia

19.6

Italy

21.4

UK

16.7

Germany

18.2 14.4

Japan

9.7

Japan

Germany

8.9

UK

11.1

US

0.0

US

0.0

Source: ProMéxico

179


| INSIGHT

STRENGTH OF PEOPLE, QUALITY OF WORK clinical research investment. Cecilia Moreno Associate Director of Clinical Management, Mexico, CA & Caribbean at PPD

JosĂŠ Viramontes Director of Remote Site Management & Monitoring, Latin America at PPD

Q: What perception does the global arena have of Mexico in clinical studies? CM: Evidence was published that the quality of data

180

Q: What steps should clinical research professionals in

generated in Mexico for international trials is comparable

Mexico take to attract investment for clinical research?

to any other country. Over the past five years, more trials

CM: We have been working with different associations and

have been allocated to Asia Pacific and Eastern Europe

the government, mostly involving process improvement.

than to Latin America. As a sector, we need to become

The Minister of Health in Mexico and the Federal Protection

more competitive and attract more clinical trials in

Commission against Sanitation Risks (COFEPRIS) are

tandem with companies and governments.

deeply interested in taking the benchmark of other countries and reviewing their regulatory processes to

JV: We must become a household name among decision-

improve timelines. As a country, we are more predictable,

makers. Clear factors influence this: timeframes, costs,

which is good for clients. The pharma industry will send

the quality of the sites and market size. We should be

more studies to Mexico if they see the timeframes for

promoting our advantages in medical infrastructure,

regulatory approval are improving.

which is in place and supported by many professionals already prepared and interested in working in this area.

JV: As a country, Mexico has several characteristics that make it very attractive to conduct clinical trials, such as

Q: As a clinical research professional, what are the areas

its population of about 128 million people, predominantly

of opportunity in terms of human capital?

living in cities, and its wide epidemiologic profile,

JV: As with any profession, the Mexican clinical trials

which includes both acute and chronic conditions. The

industry is focused on education. We want to make sure

country has a large number of highly qualified health and

the people who are part of our industry have the correct

medical professionals and a well-established regulatory

preparation and understanding of our operations. A

environment, especially strong intellectual property

step was taken in that direction via collaborations with

protection. While we are officially part of Latin America,

universities to start the clinical research training process

our close proximity to the US has enabled our country

even earlier.

to incorporate practices, processes and procedures that are similar to those of the US, making us familiar and

CM: All of our industry in Mexico has been working with

comfortable with the way US companies work. In practice,

universities, both private and public, to raise awareness

for companies having their corporate offices in the US,

among those who are graduating with science degrees.

sharing the same time zone has been a clear advantage

Few students have access to information regarding clinical

to Mexico from a business perspective. Being a Latin

trials, so the burden falls on the Mexican clinical trials

American country, we also can offer the international

industry to promote the benefits of developing a career

implementation of sites that most trials desire.

in our line of work. There are courses for clinical monitors at the National Autonomous University of Mexico (UNAM)

PPD hopes to take advantage of these natural conditions

and the National Polytechnic Institute (IPN).

and for economic and political stability to grow in Mexico. We have the tools and favorable characteristics to attract

JV: PPD routinely hires many graduates straight out of

more clinical research investment to Mexico compared

universities. For junior positions, we need the right talent

to other countries. The company has made efforts to

as early as possible to teach them about clinical trials. We

replicate South Korean success to integrate the efforts of

also need to have qualified and well-trained professionals

the main stakeholders, namely academia, the authorities

at the sites to provide role models for graduates, not just

and industry, in a common strategic plan known as

working in the industry. Several companies in Mexico

KoNECT, Korea National Enterprise for Clinical Trials.

already have implemented internship programs. At PPD

This aims to place Korea among the first 10 countries in

Mexico we have junior positions that are similar in scope


and allow people to learn and grow with the company.

IMSS cannot always meet those deadlines. We need

Their daily work contributes to the development of

to continue working with them to shorten turnaround

better pharmaceutical products for those who need

time as this institution serves an important part of the

them. Every time a product is launched for which we

population.

conducted a clinical trial we celebrate because we are JV: Although the Mexican Association of Pharmaceutical

part of an important achievement.

Investigation Industries (AMIIF) works directly with IMSS Q: What methodology are you implementing to find

to improve how it implements clinical trials, we still have

new efficient ways to introduce drugs to the market,

progress to make with timeframes and the contract

differentiating your company from competitors?

template, as some terms are not accepted by the legal

JV: PPD is one of the most innovative companies in the

departments of the companies we work for. A local legal

clinical research industry. We are recognized for the

department understands the importance of working with

strength of our people and the quality work we do. The

IMSS and is more flexible working through the terms. As

enterprise has several global initiatives underway that

a CRO, we cannot have one template that fits all, so we

address key elements of the drug development process,

have a variety of plans, each tailored to different ways of

helping to make the process more efficient.

doing things.

CM: The use of technology is another of our strengths.

Q: What upcoming projects do you have planned at PPD

We have a strong database system that is useful

Mexico?

internally and for clients to review in real time and for

CM: We will be taking advantage of new technology and

sites to evaluate patients. These interfaces are one of our

biotechnology needs. Biotech companies are growing

differentiators.

and the clinical studies are changing so we need to adapt to this.

Q: What type of trials is PPD Mexico primarily conducting in Mexico?

JV: As a global CRO with a strong presence in Mexico,

CM: We often work with oncology, a rising trend in

we are responding to industry needs. PPD aims to satisfy

the industry. We also work on rare diseases, pediatric

every need, big or small. A substantial number of PPD

indications, diabetes and neurology, and we have some

research centers are operating and we are looking to

vaccine trials underway. A great advantage is a large

increase this number as needed. We focus on the sites

population concentrated in big cities, such as Mexico

with the greatest success and seek to replicate their

City, Monterrey and Guadalajara. These three cities are

achievements at all our sites.

about the size of the total population of some European countries. There are also branches of hospitals here such as national institutes or regional hospitals. JV: With a population of about 128 million people in Mexico, we know we can participate in almost any type of trial because we have the quantity of patients. Although we have more experience in conventional therapeutic areas, we try to participate in all kinds of trials. As a CRO, PPD has studies covering a wide spectrum of medical products. PPD works with a variety of clients, both big and small, as we are capable of responding and adapting to our clients’ particular needs. As a company, PPD has strategic relationships with some clients, frequently acting as their clinical research team. Q: What advantages does working with governmental institutions like IMSS offer? CM:

The

Mexican

Social

Security Institute

(IMSS)

is evolving to change its processes, but only a few clinical trials are underway. Usually the time needed to implement and conduct a clinical trial is short and

Mexico has a population of approximately 128 million people, predominantly living in cities, making it an ideal location for clinical trials

181


| VIEW FROM THE TOP

MEXICAN DIVERSITY IDEAL FOR CLINICAL TRIALS MELISSA ROSALES Director General of RM Pharma

182

Q: What have been your latest achievements?

Q: How important is FDA approval for you?

A: We have done well in recruiting patients. We have

A: We have not yet been inspected but everyone involved

two studies in place, the first of which is a phase 2 trial

in clinical trials respects an FDA and COFEPRIS approval.

concerning rheumatoid arthritis. RM Pharma was third in

We have quality certification ISO 9001:2008 and a

patient recruitment for that trial and we were very proud

quality-control program that involves preparedness

of this because we were competing with European and US

for inspection. You are not notified in advance and

sites. We randomized 14 patients in only six weeks. It was

given time to prepare for an inspection; rather we are

very competitive due to the short timeframe available,

ready at all times. We review our SOPs and have all the

since we started in December whereas other countries

data in place. When conducting a study, we adhere to

began in February.

protocol, to the GCPs, and we maintain patient safety in recruitment.

Q: What is the main differentiator between you as a Mexican company and a European or other North

Q: If everyone was FDA inspected in addition to

American company?

COFEPRIS inspected, how would the industry in Mexico

A: The timeframes are the main difference. We know all

change?

randomized studies start in the US, followed by Western

A: I think the FDA audits improve the quality of the science.

Europe. That is a major difference. In the US, clinics have

Industries must maintain the integrity of the data that is

several sponsors. On several occasions because COFEPRIS

submitted to the health authorities, otherwise it could

took a long time to approve protocols, recruitment was

jeopardize a study. Higher FDA involvement in Mexico

completed by sites in the US and Europe and we could

could improve trust in the quality of data generated from

not participate, which reduces our competitiveness.

Mexican sites. That is why it is important to have more audits. I can see companies having at least one audit in

Q: To what extent is the diversity of Mexican ethnicities

the future.

and genetics attractive to sponsors? A: It is attractive for disease study but this is why we

Q: To what extent can Mexico be positioned as a clinical

carry out feasibility questionnaires. Not every country can

study hub?

carry out each study. Lupus for example is much more

A: Trust in Mexico is increasing. Others have seen our

aggressive in Europe. These differences are important

potential to recruit many patients and to collect varied

when sponsors are writing the protocols.

data in a timely manner. I think sponsors need to focus more on sites and we need more people to professionalize

Q: In which particular areas do you conduct studies?

clinical research. Regulatory approval timeframes have

A: We are focused on rheumatology because my partner

shortened but this is not enough as after COFEPRIS

had experience in rheumatology and I had worked on

approval other permissions still need to be obtained,

rheumatology trials previously. We are diversifying in

which lengthens the time needed to initiate a protocol.

dermatology because there are biological products we know well and my staff is competent in rheumatology

Sometimes sponsors focus on the principal researcher,

and dermatology. We hold classes so that those with less

not on the site as a team, which is the problem. I think

experience can gain more knowledge and to keep everyone

they could improve the process by supporting sites.

up to date with advances. We are trying to include internal

Sponsors only see the problems so sites do not dare tell

medicine. There are many trials in oncology but it is an

sponsors what is happening and what problems they are

area that is very difficult and I would rather conduct those

having. Sponsors have an important role to play, so I think

trials in a larger environment such as a hospital.

this can change to a real integrated partnership model.


Q: Are there enough young students choosing to move into this field to cover the growing research demand? A: I think we need to work with universities and institutions because many young people do not know

“Not every country can carry out each study. Lupus is much

how the industry works. They may want to focus only on

more aggressive in Europe”

the clinical side of clinical research, so they may move

Melissa Rosales, Director General of RM Pharma

on to private practice as they do not know what clinical research actually consists of. They need more informative conferences and more training.

more studies with a high number of patients. Our next challenge will be in October when the first study will be

Q: How have you been working with institutions to push

conducted for patients with pain due to osteoarthritis

or even develop this type of academic program?

of the knee and hip. We have committed to recruiting

A: We have this type of program in mind but we have

around 300 patients, of which 100 should be randomized.

not gained support yet. We have tried to approach other

It is the project with the most patients in the company’s

professionals and heads of departments like IMSS Centro

history. Our highest so far has been 50 patients, 34 of

Medical Nacional La Raza. We tell them who we need,

which were randomized. We are trying to configure new

we conduct interviews and we explain about GCPs and

recruitment strategies. We need to decide how to refer

the process of getting a drug to a pharmacy. If we see

patients, how to reach out to the community and what

interest, we can get them involved in a study. Afterward

advertising approach to take. The agreement gave us

if all went well, we can consider continuing with that

money to configure all these strategies, which is new

physician.

for us as most sponsors do not assign money for patient recruitment.

Q: How similar are these training programs to the inhouse programs you have?

We also have four studies in rheumatology that will start

A: I would like to implement formal training for all health

this year, the first of which we are going to perform with

professionals should they wish to be coordinators or

biosimilars. The application of these is in rheumatoid

CRAs. I need to meet with many people to accomplish

arthritis. In addition, we continue to have meetings with

this goal. If I can succeed in pushing one, then hopefully

our clients to look for new projects.

I can replicate the success with others. Physicians think of clinical research as pre-clinical research with rabbits

Q: How do you think sites should sell themselves to gain

and rats and many have no idea about clinical research

a greater share of the segment?

sponsored by the pharmaceutical industry and GCPs.

A: We are discussing forming a national association of clinical sites. We are trying to achieve this in line with the

Q: What are the company’s short-term plans?

ITESM. We have had two meetings and we expect to have

A: I already have an agreement in place with a US

a formal association by this year with more than 20 sites

company called CCBR, a BioClinica company. We are

as members. This should lead to more interaction with

now part of the site’s network. I expect this will bring us

the Ministry of Health and sponsors.

183


| VIEW FROM THE TOP

TESTING BIOTECH DRUGS, IMMUNOGENICITY AND GENE THERAPY CECILIA PADIERNA Research & Development Manager of LEI

184

Q: What relevance do third-party testing laboratories

in sales. Our market share participation falls short at

have in the market and what position do they hold?

20 percent because COFEPRIS enabled investigation

A: Third-party testing laboratories add efficiency to

institutions in these types of studies, including the

the pharmaceutical supply chain, as companies like LEI

Biotechnology Institute, the National School of Biological

support COFEPRIS’ operations in medicine and medical

Sciences (ENCB), CIATEC and UNAM’s Chemistry Faculty.

device assessments and analysis as well as clinical

Although our market share took a hit, the positive effect

activity validation. LEI eases the agency’s oversaturation,

they will have on Mexico outweighs our own interests.

ensuring the availability of medicine, but it has not been

Unlike the institutions, LEI is subject to normal procedures

able to take part in the vaccination sector. All medicines

and protocols. Despite seeing a slightly reduced cash flow,

can be considered matters of national security and

the company established added-value mechanisms that

vaccines reach over 90 percent of Mexico’s population,

minimized negative impact on our business.

having a larger impact on our society in the event of a quality breach. Another problem arises as public health

Q: What innovations will LEI release in the midterm?

institutions lack vaccine availability, which could be the

A: We are working on different specialization fields,

result of providers not delivering punctually, a lack of

one of which advances methods to predict a drug’s

vaccines in their portfolio or COFEPRIS not releasing and

immunogenicity. A large proportion of biotechnological

distributing them quickly enough. LEI could contribute

drugs produce immunogenicity, such that the human

to improving these circumstances. With Mikel Arriola’s

body detects and adversely responds to them. In those

new position as head of the Mexican Institute of Social

instances, the biocomparables molecule must react with

Security (IMSS), we expect the federal government’s

the same intensity as the innovative molecule, otherwise it

health sector to allocate more activities of this kind to

could harm the patient. Traditionally, the immunogenicity

third party testing laboratories.

stage is evaluated as far as the clinical trial phase, but LEI is developing models that can predict the molecule’s

Q: What competitive advantages can the company offer

immunogenicity in preclinical trials. Gene therapy quality

over other testing labs?

control is another field of study in which LEI innovates.

A: We are the only laboratory in Mexico that analyzes

Only four gene therapies have been approved worldwide.

biotechnological and biological products on a regular

Locally, the same technology and expertise used in gene

basis. We structure our technology based on clients

therapy studies is applied in biotechnological products,

needs, who are mostly players in transnational industry. As

wherein we have a strong foothold. Finally, nanotechnology

such, the knowledge and technology that LEI has adopted

has become one of LEI’s focal points. We are working

follows first-world and top-notch standards, resulting

alongside our partner to develop a nanotechnology-based

in business retention from all companies that supply

medical device.

biotechnological products in Mexico. Q: What challenges is the company facing? Q: What specialization areas does LEI foresee to grow the

A: Regulations have become the industry’s bottleneck.

most and impact the company’s profitability?

Years ago, LEI created a proposal to evaluate quality-

A: From a trial number standpoint, the medical device

control processes in cellular therapies. To our surprise,

sector will see the biggest change as it is growing

we realized that Mexico lacked regulation in this matter.

exponentially. For instance, from 2014 to 2015, LEI saw a

Thereafter, LEI referred to the European Medicines

40-percent growth in medical device sampling. However,

Agency (EMA) and the FDA. We evaluated their regulatory

the biocomparables sector will have the most impact on

practices and their stance in such matters, which helped

LEI’s operations, representing a 10 to 15-percent increase

us build the guidelines to our proposal.


| VIEW FROM THE TOP

MEXICO OFFERS UNPARALLELED ADVANTAGES FOR CLINICAL RESEARCH YOMANA KHOURY Manager Clinical Operations, Strategic Resources of inVentiv Health

Q: As a global CRO, how did inVentiv Health initially

the demand for services at clinical research sites is

become attracted to Mexico?

increasing, which can provide patients with better services

A: Mexico has a broad patient population, qualified

and treatments.

professionals, the right infrastructure and supportive regulations for clinical research. It continues to offer

Q: Some physicians think that clinical studies sponsored

unparalleled benefits to any clinical development program

by the pharmaceutical industry are biased. What role do

including consistent regulatory laws, quality assurance

CROs play in making sure clinical trials are ethical?

through strong adherence to ICH-GCP norms and

A: Clinical research is not taught at medical schools but

adequate technology. Mexico has reliable, well-trained

it is an actual profession. Therefore, some physicians who

investigators and a strong patient-doctor relationship,

are not involved in clinical studies tend to ignore their

resulting in good compliance and high retention rates.

scientific background and the basis of their execution.

The population is mostly concentrated in metropolitan

To conduct a clinical trial, it is mandatory to have ethics

areas and there are many public and private hospitals with

committee approval. CROs do not profit from the sales

consistent standards of care, which guarantees patients

of drugs they help develop and our role is to maintain a

will easily attend their treatments.

neutral position during the trial. We have no interest in proving a medicine to be safe and effective but we are

Q: What needs to be done to take advantage of such

interested in conducting studies according to protocol

features and bring more investment in clinical trials to

and protecting patients’ safety.

Mexico? A: Culture plays an important role in the way clinical

Q: How can clinical research professionals and services in

research is perceived among patients. In the US, people

Mexico help the region improve its services?

are familiar with clinical trials and are willing to participate

A: Some countries in Latin America such as Argentina

because they know their safety is never compromised. In

and Brazil have more experience in clinical research than

Mexico more education of the public is needed about what

Mexico. However, the latter has significantly grown in

a clinical study is, how it is regulated and the benefits.

recent years and could replicate its success in other more

Many patients miss valuable opportunities to improve

immature countries. Guatemala has an attractive population

their health due to ignorance.

and good private clinical sites but not enough trained professionals and certifications. When our workforce visits

Q: How would you evaluate Mexico’s infrastructure

those places it performs its ordinary activities and helps

capabilities for clinical trials?

them to improve. The same happens with our Colombian

A: Some public institutions are already working with big

CRAs visiting Panama or other countries that train

pharmaceutical companies and CROs and there are private

investigators and make sure the sites are compliant.

centers with solid infrastructure for trials. To comply with Good Clinical Practice, research sites have to ensure the

Q: What makes inVentiv Health a leader in clinical

right facilities. Some institutions are not aware of issues

research?

such as a lack of staff training, expiration of emergency

A: We have supported more than 507 clinical programs in

car medicines or lack of a civil protection plan. We let

over 60 countries and over 45,000 patients in the last five

them know what we are looking for and work with them

years. Also, 89 percent of cardiovascular drugs approved

to improve their practice, procedures and operations. This

by the FDA have been developed or commercialized

is certainly more common in less experienced sites so

by inVentiv. Seventy-eight percent of oncology drugs

they need to take courses and renew their certifications.

approved by the FDA have received assistance from

Physicians and professionals in Mexico should also know

inVentiv.

185


| INSIGHT

LOCAL EXPERTISE ENHANCES CUSTOMER SATISFACTION explained Ortíz. “Some people believe that complying with the regulatory package in Mexico is very easy but in fact companies need to plan ahead and consider the

ANNETTE ORTÍZ

time it will take to undergo the whole development and

Director General of EPIC CRO

registration process.” Risk management tools are effective in identifying milestones and they provide excellent data for strategic planning.

Two years ago EPIC CRO was created to entirely focus

186

on Latin America, though it already had nine-years’

According to Ortíz, a case-by-case analysis is done to fully

experience under its belt. In 2001, global regulatory

understand client needs. “We focus on several things such

requirements for clinical research were easier to comply

as the protocol design, the experts who will be conducting

with but now each regulatory agency faces different

the study, the regulatory strategy to follow and of

challenges, representing an opportunity for local CROs.

course the budget,” she says. EPIC CRO strives to have

EPIC CRO has capitalized on Mexico’s evolving position in

customized services not just for the company but also for

the global pharmaceutical and clinical research industry

each product, which is the secret to its success. With a

through its local expertise. “I am proud of Mexico’s

Clinical Trial Management System (CTMS) in place, the

current position as the second largest pharmaceutical

company is able to manage the progress of all its studies.

market in the region, and its regulations are following international standards,” says Annette Ortíz, Director

There are several advantages for small local CROs. “While

General of EPIC CRO.

large international CROs are oftentimes more expensive than smaller local ones,” says Ortíz. “They often look

Efficient and supportive regulation has been key to

for local partners because either they do not have the

improving

internationally.

expertise in a particular area or have huge workloads

Now that the country has world-class regulation for

and limited resources.” Therefore, clients often negotiate

biotechnology drugs Ortíz is confident clinical research

directly with small CROs, which provide local expertise

will grow. Other countries in Latin America are developing

and excellent customer service, making value delivery

independent regulations hardly aligned to international

and customer satisfaction easier. In addition, clinical trial

standards, while others are completely lacking. Both

management is easier, more direct, and faster, increasing

situations are not desirable since companies want their

customer trust. Small CROs have less rotation and more

products to be protected by intellectual property laws and

employee loyalty, which is highly cherished. However, they

entering those markets could represent a risk. Excessive

also look for CROs with complete infrastructure so limited

regulation could also deter product entry into domestic

technology remains a challenge. When it comes to budget

markets. “I would say Mexico is in the middle,” says Ortíz.

allocation large CROs have the advantage of being able to

“The regulation is clear and has proven to support the

subsidize small trials with larger ones.

Mexico’s

competitiveness

industry. Therefore, companies are prone to bring more clinical trials to the country.” Mexico’s proximity to the US is

EPIC CRO aims to increase the amount of clinical trials

also a benefit since they share time zones, which facilitates

it manages and become one of the top CROs in Mexico.

clinical trial logistics and sample and supplies shipping.

“We will be focusing on that over the next three years and at the same time we will further increase our capabilities

Ortíz believes companies need to understand Mexican

in Brazil, Argentina, and Colombia so we can become a

regulatory requirements for pharmaceuticals for clinical

stronger clinical research player in the region,” explains

research investment to potentially triple. New molecules,

Ortíz. EPIC CRO will expand its technological capabilities

combination drugs, generics and biopharmaceuticals all

and is determined to stand out for clinical trials

require different registration processes and clinical trials.

management service and risk control. With quality being a

Companies also have to be realistic about timelines – the

high priority for all the staff, it is aiming to provide better

submission process of a new study protocol can take

services than larger CROs. “As a local CRO we provide

three to six months. “When a company manages to fully

scientists and professionals with opportunities to develop

understand the regulation and prepares submissions

their careers and I am proud to say we employ 20 Mexican

correctly it is closer to a successful product launch,”

professionals now,” says Ortíz.


| VIEW FROM THE TOP

THE FUTURE OF CLINICAL TRIALS: SHARING ISRAEL VEGA Clinical Operations Manager of PRA Health Sciences

Q: What are your goals as the new Clinical Operations

Department. Many people think this is a staffing service

Manager of PRA Health Sciences?

but it is more complicated than that because it consists

A: We are determined to reinforce our quality and

of hiring an individual that is trained, adaptable to the

efficiency, which is why our clinical research associates are

company’s needs and able work with the infrastructure of

constantly looking at how we can improve and accomplish

the company.

our goals with a quicker turnaround time. Business renewal gives us valuable information on customer happiness

Q: What role do IT systems and digital platforms play in

and we are doing really well. Internally, as a CRO we

clinical research today?

have several qualitative objectives we want to achieve

A: PRA Health Sciences invests a lot in technology, which

and are continuously monitoring. PRA Health Sciences

is continuously evolving and has changed the way we

differentiates from other big CROs through creating

monitor clinical trials and the way data is processed. The

partnerships with customers to conduct specialized

activities of clinical research associates today are very

clinical studies. It is much more difficult to find and recruit

different from those in 1999 and 2009. We now collect

patients for oncological and rare disease clinical trials.

data in real time and share it with the client. This is the

New therapies have been developed for oncology in

future of clinical research. Immediate detection of risks

recent years with no precedents, so expertise is needed

will be possible and corrective actions will therefore be

but is hard to find.

implemented in a shorter time. We used to provide clinical sites with computers so they could access electronic case

Q: What are the drivers of double-digit growth in the CRO

reports, while now there are prototypes for accessing

industry despite stagnant pharmaceutical pipelines?

electronic forms from mobile devices. Remote monitoring also significantly reduces costs since monitors do not

A: Working with CROs can have different pros and cons

need to visit clinical sites as much as before.

depending on whether it is a Big Pharma, midsize or small innovative company. Resourcing clinical development

Q: How can clinical trials adopt a broader scope to

activities has several advantages, such as cost efficiency,

provide more knowledge of drugs during clinical trials?

and we help them to optimize R&D activities through

A: Clinical trials are the standard scientific method

highly qualified professionals taking charge of them.

to obtain information about a new molecule but full

CRO´s decision to hire depends on geographical presence

knowledge of the drug can only be obtained when

and commercial interests. Most pharmaceutical companies

the drug is taken by many patients worldwide. When

have preferred vendors, achieved by gaining customer

pharmaceutical companies partner with CROs they gain

satisfaction through high-quality services, efficiency and

specialized knowledge and services. CROs have extensive

meeting budgets. We do not only provide services for

experience in different therapeutic areas, giving us the

innovative companies, we also provide services for the

expertise to identify adverse events and when a study

development of biosimilars. Biosimilars undergo the same

has successfully met its primary and secondary endpoints

four clinical phases and pivotal studies and they require

through a validated, repeatable scientific method.

the same quality procedures as innovative drugs. Q: How do you envision PRA Health in the short term? Q: What is the difference between the CRO full service

A: Improving quality and efficiency will remain at the

model and staffing services?

center of our agenda. Mexico has the necessary capabilities

A: RPS (a unit of PRA) was one of the first CROs to

and key elements. We have excellent sites and proper

implement the embedded model in Mexico and it became

infrastructure and regulations are supportive. Patients are

the leader in this. Now it is part of our Strategic Solutions

also increasingly willing to participate in clinical trials.

187


| VIEW FROM THE TOP

STANDARDIZED PROCEDURES ATTRACT NEW TRIAL KAREN HAHN Director of Clinical Trial Management of ICON

188

Q: Mexico receives US$200 million in clinical research

the investigator’s engagement. The company is expanding

investment. Some believe this amount could triple within

its geographical outreach of sites and no longer focuses

five years. How can this be accomplished?

on large cities. We have found a niche in small towns that

A: The government is modernizing its regulations. By

are accustomed to following our metrics, which shows the

analyzing the measures implemented by first-world

new found willingness of the market.

markets, we can expedite clinical trial approvals without jeopardizing the quality of our products. The Federal

Q: With IMSS’ willingness to engage in clinical trials, what

Government, specifically COFEPRIS, learned that sharing

type of relationship does ICON have with this parastatal?

local procedures in international forums can expand

A: Over the past five years, ICON has conducted clinical

their understanding and improve efficiency in protocol

studies with IMSS. But that is completely up to our

approval. ICON is part of a CRO association that aims

clients. Although committing to IMSS takes time it is not

to standardize the segment’s processes. Rather than

impossible. Timelines are different, and so is the type of

competing to retain new clients or businesses the market

work that is conducted within the institute. Contracts

is collaborating to establish standardized procedures to

may take longer to secure but the patient volume our

attract new trials.

clients have access to far exceeds any other clinical site. In addition, the number of specialists and therapeutic areas

Q: How does the world perceive Mexico in terms of

within the organization provides added benefits. Given its

quality and infrastructure for clinical studies?

willingness to engage in these types of activities, IMSS is

A: Pharma and Biotech client companies have increased

keener to comply with procedures previously established

trust in Mexico. The levels of enrolment have always

by CROs. The retention rate is also an advantage as

been high but they are now supported by precise

patients are treated with the utmost attention.

inspections performed by either the FDA or the European Medicines Agency (EMA). COFEPRIS has improved its

Q: How is ICON incorporating new technology into

own internal procedures leading to the emergence of

clinical trials to transform the face of clinical research?

Mexico as a world leader in vaccines. The Pan-American

A: ICON combines best in class processes and industry

Health Organization’s (PAHO) recognition has opened

leading technology, delivering impact and performance

the doors for Mexico. With ongoing audits by clients

to its clients. Paper case report forms (CRFs) and clinical

Mexico has proven capable of high quality. There are

trial files are a thing of the past. ICON in collaboration

multiple opportunities that will advance our position. We

with

can channel our energy and resources to studies that

eConsent accreditation through Firecrest, which will

are affecting our community. In the past, we attracted

improve treatment compliance and expedite results in the

whatever study fell in our lap but we must be shrewder.

near future.

global

pharmaceutical

companies

gained

the

The government has asked us to attract studies that run parallel to therapeutic needs in the country like obesity,

Q: What goals has ICON set for 2016?

cancer and degenerative diseases.

A: Growth is always in our sight. ICON’s Mexican operations are the largest in Latin America with almost

Q: How does ICON decide which clinical sites it will do

200 employees. Considering six years ago there were 40

business with?

employees, our systemic growth has been noteworthy.

A: ICON’s internal system evaluates sites in Mexico based

In 2016, ICON Mexico was awarded a large contract

on available data. With it we can evaluate the site’s

enabling the company to grow its staffing division by

performance through metrics and forecasts. For instance,

45 employees. Historically, ICON Mexico has focused on

ICON has specific metrics around monitoring visits and

phase II and III studies.


| INSIGHT

MEXICAN EDGE IN CLINICAL TRIALS The development process of innovative pharmaceutical and biotechnological products is widely known to be long and expensive. Time scales and costs are extensively

CIRO GARCÍA

documented and identified in multiple industry analyses.

Director General

According to Bain & Company, these costs range between

of Accelerium

US$900 million and US$1.7 billion. Discovering and commercializing a new medicine takes an average of 1015 years. As the pharmaceutical industry’s profit margins

Centers for clinical investigation that have the adequate

are subject to increasing pressure, biotechnological and

infrastructure and human capital that is qualified to

pharmaceutical laboratories turn to outsourcing for many

manage clinical studies effectively will be a key element

aspects of their growth strategy. This pressure is predicted

for the success of R&D. The ideal research center provides

to rise in the near future. Contracted research companies

necessary resources to carry out these studies in line with

together with clinical testing centers are taking on greater

internationally established guidelines. Accelerium Clinical

importance and have become strategic associates for the

Research’s services understand the clinical investigation

biopharmaceutical industry to protect profit margins.

phases through access to large groups of patients and skilled medical researchers, operating under the strictest

Clinical trials play an increasingly critical role in light of

parameters

a growing number of procedures and in the complexity

procedures and the rules stipulated by the International

of

quality

management,

standardized

of investigation protocol. Testing now requires a more

Conference on Harmonization (ICH) and Good Clinical

diverse mix of patients globally but within specific criteria.

Practices (GCP).

These factors continue to push testing globalization, resulting in the solidification of these trends and inevitable geographical dispersion. In the past, clinical trials were principally carried out in the US. However, high demand for trials and insufficient access to patients led the biopharmaceutical industry to look to other regions. The demand for research services in Mexico is an overriding tendency, largely thanks to COFEPRIS’ interest in positioning Mexico as a global leader in the industry. Formal training programs for medical researchers also contributed to this trend.

Discovering and

commercializing a new medicine takes an average of 10-15 years

189


| VIEW FROM THE TOP

CLINICAL TRIAL INVESTMENT DEPENDENT ON STAKEHOLDER EDUCATION ARTURO RODRĂ?GUEZ President of ACROM and CEO of Infinite Clinical Research

190

Q: What activities are you planning to strengthen the

make it easier to start and conduct clinical trials in public

clinical research industry in Mexico as the new President

institutions. Better communication and simpler policies

of ACROM?

are vital to formalizing collaboration.

A: The main priority for ACROM is to consolidate the clinical research industry in Mexico. While we all agree the

Q: What needs to be done to improve the international

regulatory agency has significantly improved approval

perception of Mexico regarding clinical trials?

times for clinical study protocols. It is important to know

A: Promoting clinical research in Mexico is another

how long it takes CROs to recruit the first patient after

priority for ACROM. Little more than 200,000 clinical

receiving a new protocol. There are several processes that

trials are being conducted worldwide, of which only

could be improved between both milestones, and which

2,500 are brought to Mexico accounting for just above

could help increase the productivity of R&D for new

1 percent. We used to compete against Brazil and

drugs and medical devices. A private ethical committee

Argentina to attract clinical trials but we realized that

usually takes one month to issue an approval letter while

attracting protocols to Mexico also benefits the rest of

an institutional one can take up to three. In terms of

Latin America, and vice versa. The region has two main

intellectual property protection, many pharmaceutical

hubs - Mexico and Argentina - and both should join forces

companies have historically refused to conduct clinical

and keep protocols in the region instead of competing

trials in IMSS due to the institution having a policy

against each other. Stakeholders abroad know little about

that stated it was entitled to claim property rights of

the region and the advantages of conducting trials here.

all products that resulted from any research project conducted within its walls. Paradoxically, the lack of

Clinical trials in Mexico can provide valuable information

pharmaceutical clinical studies conducted in IMSS is one

regarding drug effects on the US Hispanic population.

of the barriers for including new drugs in the institutional

When we tell international stakeholders about our

basic formulary.

capabilities to conduct studies for drugs, biotechnology products and medical devices they are skeptical. They are

Q: Do you believe CROs and pharmaceutical companies

not aware that Mexico City has 20 million people making

are more interested in conducting clinical trials in IMSS

it ideal to execute studies and recruit patients.

after it revised its policies over possession of property rights?

It is important to convey the right message and prove that

A: We want to enter into a strategic alliance with IMSS as

Mexico has a mature clinical research industry delivering

we gradually see more companies working there due to

great results. In the last decade a great emphasis was

modified policy. At Infinite Clinical Research (ICR) we have

placed on the professionalization of clinical research in the

three protocols we wish to carry out in IMSS. But there are

country. We have professional, institutional and private

other factors affecting the actual opening of the protocol

sites, ethics committees protecting patients safety and a

such as the number of patients recruited worldwide

strong regulatory agency.

and the time it takes to start a protocol in Mexico. Pharmaceutical companies, CROs, and the government

Q: As Director of ICR, in what areas will there be more

want to work together but collaboration agreements need

clinical trials and what services represent promising

to be structured and formalized.

business opportunities? A: There are many clinical trials for dermatology,

ACROM is engaged in this kind of discussion and it

cardiovascular, metabolic, gastro and medical devices.

has several divisions designated to work with public

This changes on a regular basis as two years ago the

institutions. We want to devise templates and processes to

cardiovascular area was the largest segment while this


year dermatology is number one. One of the advantages

pharmacodynamics, while bioequivalence studies basically

of ICR is that we are a general CRO. This allows us more

consist of obtaining pharmacokinetic curves.

flexibility to manage clinical studies of any therapeutic area and we always train the team in particular areas so

There are three sites in Mexico that can actually conduct

it is qualified to coordinate the study. ICR has already

phase I studies. The demand for phase I clinical trials is

tapped into the pharmacovigilance area, in which we are

not growing in the short term because they are usually

able to design risk management plans for protocols and

performed in clinical sites near headquarters or scientific

methodologies for hospitals and doctors.

groups of pharmaceutical companies – most of them located in the US and Europe – and only when they are

Hence, they can follow up on the drug for a certain period

saturated do they migrate to other places.

as required by COFEPRIS. In the past, a report was drafted every six months and many companies used to present

Q: Last year you mentioned you had plans to enter the

reports with zero findings regarding adverse events.

Central American and Caribbean region. What have you

Now the authority requires higher quality reports and

achieved in this respect?

the implementation of collection methods for accurate

A: We established a partnership with another CRO and

information regarding safety. We are also participating

now we can provide services in the region, including

in research projects for cell therapies, an area that is

Brazil, Argentina, Chile, Colombia, Central America

not new in Mexico but still lacks clear regulation. We

and the Caribbean countries. Both our partner and

are closely working with a Senate Commission to attain

ICR have business development departments and the

it and prevent the loss of clinical studies given that last

agreement consists of sharing a protocol to represent

year 15 were not approved by the authority due to a lack

the whole region. We have already homogenized

of regulation.

standard

operational

procedures

and

established

communications lines. Q: Why do you think it has taken so long to have a clear regulation for cell and gene therapy while COFEPRIS

Q: What are your main concerns?

quickly developed the new regulation for biotechnology

A: I am concerned that US$28 billion is invested globally

drugs?

in clinical trials, of which Mexico only receives US$200

A: Cell therapy was initially included in the regulation for

million or 1 percent of clinical trials. Thirty percent

the use of tissues. However, there are some preparation

of global clinical trials are being managed by CROs.

methods that include cells in a solution and the

Considering the development of one molecule costs US$1

regulation did not cover the use of animal cells, plant

million, US$200 million is very little investment. Clinical

cells and autologous implants of stem cells. Cell therapy

trials are also a great opportunity to benefit patients with

has a promising future but we are in the initial stages

new treatments and is also a good source of revenues.

of its development and we have to wait and see its full

Last year, 10,000 patients were enrolled in clinical trials

potential.

conducted by member CROs of ACROM, which account for 60 percent of the all clinical trials in the country.

Some countries such as Japan and Panama already have a clear law for this kind of product and their commercialization is authorized. Protocols for cell therapy are needed to generate conclusive information. Mexico closed the door to cell therapies last year but also identified a group working in this area so we expect cell therapy protocols to be on the agenda for the next five years. Q: Some CROs have shown interest in conducting phase I clinical trials in Mexico. To what extent does the country have the necessary infrastructure and specialists to do so? A: Most clinical trials conducted in Mexico are phases II and III and most people do not understand the difference between phase I studies and bioequivalence ones. The quality, precision and standardization of processes are completely different. Phase I requires a high degree of detail, including toxicology, pharmacokinetics and

US$28 billion is invested globally clinical trials,

of which Mexico only receives US$200 million or 1 percent

of clinical trials

191



9

INNOVATION & BIOTECH

Biotechnology has a considerable number of applications and improves treatments that not so long ago were considered risky or impossible. Stem-cell research, controversial and even banned in some countries, is being developed in Mexico to treat auto-immune diseases and to help slow the aging process. Others are focusing on developing drugs to help patients cope with mental disorders, which can be as debilitating as a physical disability. Fertility treatment is leaps and bounds ahead of where it was 10-15 years ago and allows older couples a greater chance of conceiving and for women to delay having children by freezing ovules.

Many biopharmaceuticals are in the pipeline and companies continue to invest in R&D. Industry insiders expect the biopharmaceutical market to specialize further in Latin America over the next three years. Mexican academia has been keen to join the sector, offering state-of-the-art facilities and recruiting more talent into these efforts. This chapter will look at the fascinating advances that are being made, the growth expectations companies have of the market and how the regulation regarding biotech has evolved.

193



| CHAPTER 9: INNOVATION & BIOTECH

196

ANALYSIS: Biomedicine Stealing the Spotlight

198

VIEW FROM THE TOP: Franz Schubert, BIOSKINCO

Sergio Villa, BIOSKINCO Mexico

199

VIEW FROM THE TOP: Ernesto Gutiérrez, World Stem Cells Clinic

200

INSIGHT: Óscar Parra, Lundbeck

201

VIEW FROM THE TOP: Mauricio Vidales , Croda

Christian Escandón, Croda

202

VIEW FROM THE TOP: Mario Cervantes, CareFusion/Becton Dickinson

205

VIEW FROM THE TOP: Octavio Tonatiuh, IBt

206

VIEW FROM THE TOP: Thomas Cantor, Scantibodies

207

VIEW FROM THE TOP: Edna Álvarez, Malvern Instruments

208

VIEW FROM THE TOP: José Islas, IVINSEMER

209

VIEW FROM THE TOP: Joel Osorio, RegenerAge

195


| ANALYSIS

BIOMEDICINE STEALING THE SPOTLIGHT As technology evolves so do the options for treating

Group and published in The Journal of the American

disease. While the world waits on the next big cure or

Medical association showed US government research

treatment in medicine, pioneers in the field are working

funding from 2004-2012 fell to 50 percent of the global

to deliver just that. To do so, they are increasingly turning

total from 57 percent. US companies also spent less,

to advanced technology and innovations to find solutions

posting a drop to 41 percent from 50 percent in the same

for complicated puzzles.

period, according to the study. At the same time industry accounted for 58 percent of US research funding in 2012,

This is the world of biological medicine, where cutting-

compared with 46 percent in 1994.

edge treatments are on the market or in development for

196

everything from infertility to cancer. Instead of chemically

As the US slowed its spending, Asia picked up the slack.

synthesizing drugs, these researchers and innovators are

The study showed China tripling its research funding

looking into stem cells, gene therapy, blood components

to US$4.9 billion from US$1.6 billion. The total for Asia

and tissues, among others. It is an area that is growing

jumped to a whopping US$14.6 billion from $1.6 billion

and for companies big and small, Mexico is increasingly

in the period.

on the radar.

A GROWING NICHE Amgen, among the world’s leading biotech companies

Biosimilars, or drugs that are similar to already approved

with an array of products on the market, came to Mexico

biological products, are an area that companies like

in 2006 and invests 19 percent of its global revenue in

Croda view favorably. “Over the next few years we will

R&D. It sees a growing trend for biological drugs, citing

be looking into biosimilars, a growing niche believed to

a COFEPRIS report that said 35 percent of the drugs

be the future of the pharmaceutical industry,” Croda’s

approved in Mexico are biologics.

Commercial Manager Christian Escandón says.

“We assume this to be a sustainable trend,” says Elvin

Penn, at Amgen, agrees. “Amgen is committed to

Penn, Director General of Amgen. “Biologics account for

developing and launching biosimilars since they can cover

around 30 percent of the products undergoing clinical

a wider population, hence helping the healthcare system,”

development.”

Penn says. “These medicines require a significant effort to be developed because their comparability and effect

This growth has come rapidly, as technology overtakes

has to be demonstrated through clinical studies, not only

more traditional methods of drug development. Mauricio

through physicochemical characterization methods.”

Vidales, Director General of Croda, points out that “in 2004, just one of the leading global drugs was a so-

Edna

Álvarez,

the

Latin

America

Manager

of

called big molecule or biologic with nine others being

Malvern Instruments, a leading provider of scientific

developed through more traditional means. Ten years

instrumentation, says the sector is actively growing.

later, seven of the top 10 new drugs approved in 2014

“Three technologies are seeing the highest demand,”

were biologics.”

she says. “These are laser diffraction for particle size characterization and distribution, dynamic light

The US is the traditional leader in biomedical research

scattering and nanoparticle tracking analysis focused

funding but it appears to be slowing as others climb into

on nanoparticles, and image analysis solutions for

the arena. A 2015 study led by The Boston Consulting

characterizing the shape of particles.”

“Over the next few years

Mexico has a number of advantages that help it attract

we will be looking into

involvement in a number of free-trade agreements like

biosimilars, a growing niche believed to be the future of the pharmaceutical industry” Christian Escandón, Croda’s Commercial Manager

investment, including its close proximity to the US and NAFTA that make it easier to do business here for foreign companies. Equivalency agreements signed by COFEPRIS with agencies like the US FDA and Europe’s EMA are also important because they can quicken the process of getting drugs to market.


“Regulatory recognition among countries is evolving and

Gutiérrez adds that understanding of the possibilities for

will certainly play a much more relevant role in upcoming

biologics such as stem cell therapies is another factor

years,” Penn says. But there are problems and hurdles

to consider. “There is still a long way to go in terms of

that need to be overcome, among them is local expertise.

understanding everything we can achieve with stem cell

To overcome these, many industry players are looking at

technology and how to do it.”

partnering with academic institutions.

THE NEXT FIVE YEARS “A key problem is the expertise in the industry regarding

As the industry develops and grows to the extent of the

state-of-the-art biotechnology,” says Octavio Ramírez,

that of the US and Europe, it is possible to imagine what

Director of UNAM’s Instituto de Biotecnología (IBt).

lies ahead. UNAM’s Ramírez looked five years out to give

“Lack of expertise and knowledge results in foreigners

an idea of what biopharma applications might be on the

often selling suboptimal or outdated technology to

horizon.

the Mexican industry, which, in general, is not capable of differentiating them from true valuable state-of-the-

“Biopharmaceuticals aimed at attending the particular

art technology. The industry is gaining more and more

needs of the Mexican population, would be the ideal

knowledge, but they need to trust the academy as allies

niche for the industry segment to be able to compete

on technology assessment.”

with translational companies. I believe that personalized and genetic medicine is a key field that the Mexican

But it’s a two-way street, he says. “Academics need to

biopharmaceutical industry could focus on. Diagnostics

make a better work in collaborating with the productive

is also a field of particular importance for Mexico,

sector and gaining their confidence.”

and again, particular niches can be exploited by the pharmaceutical industry.”

PERCEPTION PLAYS A ROLE Perception also plays a big role as foreign companies

To create a healthy biopharmaceutical market that can

look to Mexico. Thanks in part to medical tourism, the

thrive in the short term, Ramírez sees an important role

country is seeing an improvement in how it is viewed

for COFEPRIS in bringing new opportunities.

from abroad. “The increased strength of COFEPRIS is an important area “It is slowly changing, and medical tourism has influenced

of opportunity. Mexico has become a leading country by

this,” says Ernesto Gutiérrez, President of World Stem

approving state-of-the-art treatments in an expeditious

Cells Clinic. “World trends, especially regarding US

manner, with a strict scientific review,” he says.

and European patients, have made healthcare systems almost unaffordable for big population segments, giving

“An example is the approval of the dengue vaccine. I

way to insurance companies. The social gap between

believe this is an important area of opportunity, as the

those using Medicaid and Medicare, and others that can

table is set for the evaluation of new approaches to

afford private health services in the US is quite sizeable.

improve health. Mexico needs to stop being a follower

As such, Mexico offers them an affordable solution to

and continue down a leadership track, with strong

their needs.”

support from the scientific community in the country.”

MEXICO IN FIFTH SPOT FOR EXPORTS TO US MARKET

MEXICO A COMPETITIVE PLACE FOR R&D ON CLINICAL TRIALS

US imports of life-sciences products in 2015 (US$ millions)

Country

Ireland

12,129

Mexico

5,515

UK

Savings (percent) 46.2

Netherlands

27.0

4,383

Canada

26.6

Switzerland

4,253

Australia

22.5

Mexico

3,974

Italy

China

2,446

France

Germany

21.3 20.6

Japan

1,734

Germany

17.2

Singapore

1,639

Japan

12.6

Belgium

1,529

UK

10.3

India

1,474

US

0.0

Source: ProMéxico

197


| VIEW FROM THE TOP

MEXICAN DRUGS AND EUROPEAN HURDLES

Franz Schubert CEO of BIOSKINCO

198

Sergio Villa Director General of BIOSKINCO Mexico

Q: What has been BIOSKINCO’s development in other

avoid being labeled as a low-quality product from Mexico

countries such as Germany given your success in Mexico?

it is being redeveloped in Europe and we are in the process

FS: We are taking the first steps and the process of

of creating a European company. In the meantime, we are

registering a product in Europe will take at least three

working with a Spanish company that will be in charge

years. BIOSKINCO is opening an affiliate in Germany which

of the manufacturing in Europe under European GMP

will create several possibilities for developing a portfolio of

standards. We are now transferring technology from

products. The registration process of Epifast®, BIOSKINCO’s

Mexico to Europe which we are very proud of.

blockbuster product, is ongoing but it will take more time. Q: BIOSKINCO recently announced an increase in Epifast® Q: What barriers have you encountered to launch Epifast®

production by 50 percent. How are you planning to

in Europe?

achieve that from an industrial point of view?

FS: The regulation in Europe is different from that of

SV: We have already scaled up the production of

Mexico and the US. In Europe, Epifast® has to be submitted

Epifast® by 30 percent for next year. To continue scaling

as a pharmaceutical and that is why it's taking so long.

it up by 25 percent per year, we will have to invest in a

However, in Mexico, Epifast® is registered as a medical

new facility between 2017 and 2018. In Mexico, we have

device.

COFEPRIS certification that is supported by the Ministry of Health. Having the certification gives us the possibility

There is a worldwide trend in which new therapies that have

to go to other places in the world but we are required to

a sophisticated pathway and include an interaction with

show the authorities of the new region that we comply

the body can be registered as Advanced Therapy Medicinal

with the standards of each country. For instance, the

Products (ATMP). Epifast® is to be considered an ATMP in

authorities could come visit our facilities and check for

Europe because it promotes healing of the wounds by the

their standards. As for Europe we have two options,

interaction of keratinocyte cells delivering growth factors

either comply with their requirements and accept their

to the cells remaining in the patient´s wound. This product

visit or produce it in Europe under its regulation and

requires a lot of knowledge to be transferred to doctors so

best practices.

they can learn how to use it. FS: There are many pharmaceutical companies that In Mexico, the production of Epifast® could be developed

want to commercialize products in Europe. But, it

and done in a university but in Europe this is not allowed.

seems

The product has to be manufactured at Good Manufacturing

quality assurance and regulatory compliance. We are

Practice (GMP) facilities. To have it manufactured in a

expecting a new regulation stating local manufacture is a

hospital would require an average investment of €5 million

commercialization requirement. Therefore, we are planning

(US$5.4 million) plus maintenance that no hospital can

to manufacture Epifast® in Europe with GMP certification

afford. This high investment would make the unit price of

despite higher production costs. At this point, the product

Epifast® very high.

is under development in Europe including animal and

authorities

are

becoming

stricter

regarding

clinical studies. Authorities recognize that we have done a Q: What is your strategy to ensure the quality of

good job in Mexico, especially after presenting them with a

manufacturing at a greater scale to serve those markets?

retrospective study and evidence of the positive outcomes

SV: Epifast® already complies with the internationally

the product has had in over 10,000 patients. Data also

accepted standard GMP and therefore can be sold in

shows that 50 percent of the patients who received the

Europe. Nevertheless, we have to review our production

product are children and no other company is producing

conditions and comply with European GMP auditors. To

such an excellent product for them.


| VIEW FROM THE TOP

NEW ERA OF HEALTHCARE IS BORN ERNESTO GUTIÉRREZ President of World Stem Cells Clinic

Q: Stem cell treatments have the potential of treating

channeled its efforts to various orthopedic conditions that

chronic conditions, which have now become the greatest

are an everyday occurrence.

obstacle for healthcare systems around the world. How are they improving the stance of Mexico’s health?

Q: Where will we see regenerative treatments in the

A: Stem cells are able to treat and improve patients’ health

future?

but they cannot cure any type of illness. In short, they

There is still a long way to go in terms of understanding

help the body heal itself. They are the human body’s own

everything we can achieve with stem cell technology

repair mechanism regardless of the ailment. Stem cells are

and how to do it. Through its parent company DaVinci

“generic” cells that can become different tissues such as

Biosciences, World Stem Cells Clinic is developing tissues

bone, muscle or even pulmonary or cardiac tissue to name

for the pharmaceutical industry, relieving them from

a few. Clinics like ours have the capability of identifying

running preclinical studies in humans. Through our work,

these specialized cells, retrieving, storing, multiplying and

Big Pharma companies will be able to test their products

applying them where needed. Instead of allowing stem

on real cardiac tissue grown in our lab, thereby minimizing

cells to identify the issue themselves we can place them

costs and expediting results. When we finally learn how

where we need to in order to expedite the healing process.

to manipulate and influence the differentiators of each cell, as well as their specialty, we will see enormous

For the general population stem cell treatments are

leaps in health outcomes. For instance, instead of

normally thought of as either miracle solutions that can

applying synthetic components for wound closure we

cure everything or complete scams. The reality is that stem

can implement combinations of biodegradable polymers

cell therapies fall in between the two. Our therapies merely

with stem cells that can heal while sealing an injury. The

help the body heal itself through its own repair mechanism.

preclinical research work World Stem Cells Clinic is doing

Some physicians and patients still cannot grasp this

in Mexico is far ahead of our closest competitors.

therapeutic approach as it differs from the pharmaceutical approach we are all familiar with. There is no question that

Q: With a renowned position in the field, what

pharmaceuticals are of the utmost importance for society.

collaborations has World Stem Cells Clinic created in

Nonetheless, regenerative medicine through stem cell

Mexico and abroad?

treatment adds options and complements health solutions.

A: There are many international MDs that collaborate with

Stem cells have a myriad of applications contrary to drugs

us, especially in the autism field. They have sent several

that are focused on a single condition. In fact, drugs are

patients to our facility and followed up with them, which

developed and manufactured in this way to minimize the

further helps us in our data-gathering process. On the other

number of tissues they act upon and consequently the

hand, we will soon receive sport medicine doctors from

number of adverse effects they may have.

the US and Europe to facilitate an introduction of stem cell therapy to their field. This type of collaboration has

Q: What are the treatments foreign patients come to

helped us increase the number of treatment applications.

World Stem Cells Clinic for?

A big part of my job is to continue educating both patients

A: World Stem Cells Clinic has focused on an array

and doctors on the benefits of stem cell treatments. After

of applications in both its treatments and research

specialist physicians realize what stem cells can do they

activities. These include autism, cerebral palsy and

are the ones who come up with specific challenges in

neurodegenerative diseases, such as Parkinson’s, Charcot-

their fields, which could be overcome with stem cell

Marie-Tooth disease (CMT) and multiple sclerosis. We have

therapeutics and together we begin brainstorming and

also treated a vast number of autoimmune diseases like

developing new applications. Combined, a new era of

rheumatoid arthritis and lupus. World Stem Cells Clinic has

healthcare delivery is born.

199


| INSIGHT

LUNDBECK TO FIGHT DEPRESSION IN MEXICO so difficult for people to understand because they affect individual emotions and behavior,” explains Parra. In Mexico, development of proper diagnosis and advanced

ÓSCAR PARRA

knowledge on the impact of such diseases is necessary.

General Manager of Lundbeck

Mexico has a demographic bonus expected to drive economic growth and prosperity but Parra agrees on the impossibility to grasp this opportunity without a healthy

200

There are few companies in the world dedicated to bringing

population.

Untreated

depression

severely

impacts

innovation to central nervous system (CNS) diseases, which

individual productivity and can reduce thousands of

are often neglected due to societal stigma. CNS disorders

productive hours due to absenteeism, as diabetes already

are debilitating to the extent that patients end up unable

does. Lundbeck is engaged in this kind of constructive

to take care of themselves at all, impacting the lives of

discussion with the authorities and is committed to

relatives. Despite being well known, depression is still an

providing continuous medical education for physicians in

underdiagnosed disease and recent findings indicate that

direct contact with patients. Digital tools available online

it will be among the most debilitating diseases in the world

are also offered to create awareness about this issue.

in the next decade, even more so than diabetes and with a detrimental effect on quality of life and productivity.

At this point, Lundbeck is focused on prescription

Lundbeck is committed to providing solutions to 60 million

medicines in the private market. “Of course the public

people worldwide suffering from depression, Parkinson’s

sector is relevant to us and currently there are a great

disease, Alzheimer’s, sleep disorders and schizophrenia

deal of discussions regarding market access,” says Parra.

through cutting-edge research and new products. This will

When a medicine is approved by COFEPRIS it is ready to

improve the lives of many people who would otherwise

be commercialized in the private market but it still has a

lose years if not decades of good quality of life.

long way to go in the public sector. This does not mean the company discards entering this segment. The private

Mexico is one of the top regions for the company and

sector has its own hurdles. Most psychiatric disorders are

often provides invaluable input for its global strategy.

not reimbursed by private insurances and as explained

For instance, Mexico was involved in a project related

by Parra, depression is one of the diseases that will most

to the development of an anti-depressant two years

impact productivity in the private sector.

before it was launched on a global scale. Lundbeck is not exempt from the wave of patent expirations taking

With Mexico’s progress in the clinical research field,

place in the pharmaceutical industry and its strategy to

Lundbeck has conducted several clinical trials in both

mitigate this is through a stronger focus on innovation.

private and public research centers. For innovative

In the next couple of years it will launch a new drug

companies the southern area of Mexico City is highly

for sleep disorders followed by an anti-psychotic. “I

attractive due to the extraordinary density of highly

am confident that we have many interesting growth

specialized physicians and healthcare companies. “As for

opportunities in the future,” says Óscar Parra, General

the role clinical trials play in improving new drug approval

Manager of Lundbeck Mexico. The central nervous

processes and inclusion to basic formularies, conducting

system segment is flooded with generics – just one of

a clinical trial in public institutions does not provide

Lundbeck’s molecules competes against 20 generics.

any benefit for admittance of new drugs into basic

Therefore, Parra continues working with a business

formularies,” Parra says. Clinical trials and drug inclusion

model that includes visits to physicians and information

are two very different processes but could greatly improve

exchanges. In the last five years, the acceptance of

if they were connected. Moreover, Lundbeck might

generics has grown significantly among the population,

benefit in the future from COFEPRIS’ recognition by other

leading

regulatory agencies in Latin America where Lundbeck has

multinational

companies

to

maintain

their

competitive position through innovation.

a direct and indirect presence. “I think there are two ways to look at things," Parra says. "Compared to the past,

People with mental disorders are still stigmatized in

things could look rather difficult now but examining the

Mexico, which is a harsh reality to accept. “We are used

situation of other countries Mexico has fewer challenges

to seeing people in leg casts but mental disorders are

in comparison and has copious business opportunities.”


| VIEW FROM THE TOP

THE RISE OF BIOLOGICS

Mauricio Vidales Country Director of Croda

Christian Escandón Commercial Manager of Life Sciences at Croda

Q: Why did you feel that Mexico was a good place to

Q: What niches do you operate in?

establish a subsidiary?

CE: In oncology we have a wide range of ingredients

MV: We have been in Mexico for over 40 years. Although

suitable for use in parenteral applications. Consumers

the company began in the personal care market, we have

expect high-quality transparent liquids without any

seen great growth in the pharmaceutical industry in the

particles or sediments. If a patient sees a strange particle

last decade. I think Mexican customers really value the

in a product particularly in a liquid or an injectable liquid,

ingredients and expertise we can offer to help them get

they will rightly not trust the medicine. We also have a

the best performance from their active ingredients.

wide range of ingredients for topical application and expertise in the area of oral liquids.

Q: What is the market outlook for the world of pharmaceuticals?

Q: How do you see your position in Mexico over the next

MV: The pharma market is changing. In fact, it has already

several years?

changed with biopharmaceuticals playing an increasingly

CE: The Latin American management of Croda is indeed

important role. In 2004, just one of the leading global

looking at Mexico as a growth hub. Considering that our

drugs was a so-called big molecule or biologic, with nine

specialties are applicable in a few niche specialties we have

others being developed through more traditional means.

very aggressive growth targets in those segments. This

Ten years later, seven of the top 10 new drugs approved

growth does not exactly match the growth of the market

in 2014 were biologics. This increased development of

as the market will grow mostly in solids. Over the next few

biologics is shifting R&D development toward injectables,

years we will be looking into biosimilars, a growing niche

not just needles but increased sophistication led by

believed to be the future of the pharmaceutical industry. We

devices such as pens and autoinjectors. Croda’s wide

also produce high-purity Omega 3 fish oil concentrates that

range of Super Refined ingredients, and especially our

provide clinically supported health benefits for nutritional

high-purity Polysorate range are well suited to meet the

and pharmaceutical use. Our Incromega™ and OmeRx™ fish

needs in this area.

oil concentrates are produced using proprietary PureMax™ technology.

Q: What can you tell us about your Super Refined™ range of ingredients and how they help overcome industry

MV: We have a skincare lab in Mexico and have been

challenges?

looking into claim substantiation, which is related to

MV: One of the main challenges faced by pharmaceutical

the technical aspect of hair care or skin rejuvenation.

formulators

drug

We pride ourselves on our technical expertise and have

formulations. Many active pharmaceutical ingredients

invested several million dollars in our Mexican offices and

(APIs) can respond unstably to oxidation, moisture or pH,

laboratories as part of our continued investment.

is

the

ability

to

produce

stable

affecting the both the stability of the drug and the final formulation.

Q: Based on your experience so far, do you foresee further investment in Mexico?

To create products with both superior quality and purity,

MV: Yes we are certainly hopeful to grow our footprint.

Croda developed a proprietary flash chromatographic

Croda Mexico is composed of three major divisions: Life

process called Super Refining. This process physically

Sciences, which oversees both crop care and pharma,

removes impurities from pharmaceutical excipients without

Personal

altering their fundamental structure. The removal of these

Industrial Chemicals (PTIC), which focuses on market

polar impurities helps reduce API interaction, maintaining

segments such as Home Care, GeoTech (Petroleum &

both the stability of the drug and the final formulation.

Gas), Mining and Polymer Additives.

Care,

and

Performance

Technologies

and

201


| VIEW FROM THE TOP

TIJUANA A CRITICAL HUB FOR US HOSPITALS MARIO CERVANTES VP of Manufacturing of CareFusion/Becton Dickinson

202

Q: How do CareFusion products contribute to improving

A: We are a global company and we need to comply

the service at Mexican hospitals?

with many regulations. We live in an extremely regulated

A: BD offers a wide array of products to hospitals

environment. We need to comply with the FDA, European

around the world. In particular, in Tijuana, CareFusion

regulation, ISO and COFEPRIS for products sold in

manufactures IV sets and related products used to

Mexico. Over the past few years we have witnessed the

deliver fluids and medication to patients. We produce

homogenization of regulations. COFEPRIS regulations are

over 1 million IV sets per day. That makes us one of the

similar to those required for pharma but not so much for

largest manufacturers of this type of product in the world.

medical device manufacturing. This is an area in which as

We supply IV sets to Mexico as part of a bundle of BD

a country we could improve by segregating COFEPRIS

products, including syringes, needles, diabetes care and

regulations so they could have two branches, one focused

medication management solutions.

on pharma and another branch dedicated to regulate and control medical device manufacturing.

Q: What is your best-selling product in the Mexican market?

Q: What percentage of the market in Mexico do you

A: That would be the Alaris pump, the pump that is

occupy?

compatible with the IV sets we manufacture at this site.

A: Mexico and Latin America are vital for the development

It is widely used in hospitals because of its precision in

of BD. We have grown dramatically in Mexico, the secret

dispensing doses through computerized control. The

to which is our Mexican associates. We have the best

pumps can interact with computers in the hospital to

personnel to work with. Our direct labor is dedicated,

insure the correct fluids and drugs are being dispensed

of high quality and with a consciousness for quality

to the patient. One of the main issues hospitals face is the

like nowhere else in the world. Our professional base

dispensing of incorrect medication formulas and doses.

is comprised of engineers, administrators and finance

Our infusion systems devices work both independently

specialists.

and together to accurately deliver infusions while helping protect each patient.

Everyone is highly specialized and qualified in what they do. Previously, I tried to set up manufacturing sites

Q: What recent innovative products have you brought to

in Eastern Europe, North Africa and Asia but we were

Mexico?

limited by the number of professionals available. In Baja

A: A key element of our product is the type of connector

California, we are blessed with a large cluster of medical

valve we use. It allows physicians to access the IV set

device manufacturers that employ between 40,000-

without using needles. Connector valves can be classified

45,000 people. This is a large pool of professionals

as positive displacement no displacement or negative

already

displacement according to doctors’ needs. The importance

validation and new production introductions. Anyone can

of this product lies in the elimination of needles as they

buy machines and buildings but Mexican associates are

need to be disposed of afterward, which creates a health

an insurance for success.

knowledgeable

about

sterilization,

product

hazard for nurses. Patients are mostly medicated alongside the IV sets and the drugs sometimes attack the resin the IV

Q: How are universities and companies working together

sets are made of. The valves are designed to withstand even

to ensure human talent is optimal and willing to stay in

the most aggressive chemicals in chemotherapy sessions.

Mexico? A: There are almost 35 public and private universities in

Q: What are the main regulatory challenges in Mexico for

the area. We have close relationships and agreements with

pharma companies?

them to prepare professionals with the necessary skills.


We have 25-26 paid interns working for us as part of

as 90 percent to 95 percent of patients admitted to

the agreement. This allows them not only to complete

hospital will receive some type of intravenous therapy.

the number of work experience hours needed for their

We also sell our products in Australia, New Zealand

degree but also to learn something valuable. We forbid

and Europe. BD believes in manufacturing close to

interns from performing clerical jobs as that is not

the market, so products destined for the Asian and

what they are here for. They come to complement their

Eastern European markets are manufactured near to

education and we want to make sure they get valuable

those regions. We expect to see both organic and non-

experience during their time with us. Quite often, these

organic growth. Organic growth has been at 7-8 percent

interns return to work with us as engineers. We recently

year on year in which acquisitions have also played a

hired a young lady who completed her internship with us

significant role. BD recently acquired CareFusion but

and then graduated at the top of her engineering class.

even before, CareFusion was acquiring other companies such as Medegen Inc. and others. Combined organic

We also invest heavily in our employees on technical

and inorganic growth would be around 12 percent for

aspects such as process validation abilities, but also

Tijuana.

on the soft skills a well-rounded professional always needs. We have many seminars and training sessions on

Q: What are the most relevant projects you are working on?

supervisory skills, emotional intelligence, how to deal

A: We continue to grow tremendously. We are investing

with difficult people, among others. These well-balanced

heavily on automation, injection molding machines,

professionals eventually will be managers; people skills

molds and extrusion.

make them promotable. We believe in promoting from within and in developing talent.

Q: What percentage of production remains in Mexico and what percentage is exported?

We have a very good program to help our employees

A: 100 percent of production goes to the US and 85

through high school and through professional education.

percent is consumed within the US. The remaining 15

We have 16 employees in elementary school, almost 30

percent goes to Australia, New Zealand, Italy, England,

in secondary school, 10 are completing a bachelor’s

France, Latin America and Spain.

degree and five or six are working on a master’s degree. Every year we hold a party for those that graduate. We

Q: What can we expect to see from CareFusion over the

also have other kinds of classes for our employees, such

next year?

as salsa dancing or health cooking, singing and guitar

A: You will see products that continue to improve lives,

lessons. We offer about 10 different programs, English

they will be easier to use by nurses and doctors, safer

lessons included.

for patients and more resistant to the new drugs being administered to patients in chemo sessions. There will

The country in general, and Baja California in particular,

also be much advancement in the software that comes

needs to continue to invest in talent development. We

with our pumps and how they interact with computers

seem to be growing faster in the industry than the

in hospitals to track drug use and ensure the medication

talent pool is, so although we invest in developing

is correct. It would for example prevent an infant from

our associates we also need the participation of the

being supplied with an adult dose.

government. The three government levels must make it easier for the young population to enroll in schools and to obtain scholarships to be successful professionals. We also need to promote technical education for those that decide not to pursue a professional degree. Q: What growth has CareFusion seen in recent years and what growth do you expect to see? Is this expected to be via acquisitions or via organic growth? A: CareFusion is now part of BD and our site in Tijuana has grown from 2,000 employees six years ago to 5,800 employees today. This shows dramatic head count growth and we have seen it also in terms of exports from Mexico. Right now products from Tijuana are valued at close to US$900 million in global sales. This site is critical for hospital operation in the US and Latin America

The medical devices industry in Baja California employs

40,000-45,000 people

203


| INNOVATIVE DRUG SPOTLIGHT BRINTELLIX (VORTIOXETINE) FROM LUNDBECK

sexual dysfunction, cognitive function, comorbid anxiety

Lundbeck has developed Brintellix® (vortioxetine). It is one

and insomnia. Brintellix® is an effective and well tolerated

of very few novel antidepressants approved in past years

antidepressant in short-term as well as long-term treatment

for treatment of adult patients with major depressive

clinical trials, with a low level of discontinuation symptoms.

disorder (MDD). MDD is related to significant cognitive

Brintellix® was approved by the FDA in September 2013

deficits such as psychomotor speed, attention, visual

and the European Medicine Agency (EMA) in October

learning and memory, involving all aspects of executive

2013 for the treatment of MDD. It was approved for the

functioning, and this is a milestone for Brintellix®.

same indication by COFEPRIS in July 2014.

Vortioxetine is the result of an approach based on a thorough understanding of the disease and its consequences over the quality of life of patients with MDD. Brintellix® is a multimodal antidepressant with two modes of action, receptor modulation and reu-ptake inhibition, which moderate several key neurotransmitter systems known to be involved in mood 204

disorders and their related cognitive deficits. Brintellix is part of a new therapeutic class of antidepressants, which is different to previous families of the established classes of SSRI’s, SNRI’s, tricyclic antidepressants and monoamine oxidase inhibitors. Its unique mode of action is thought to result in the effects observed in clinical studies, both in terms of efficacy and the benign safety/tolerability profile – such as mood,

Chemical structure of vortioxetine hydrobromide


| VIEW FROM THE TOP

TRAINING PROFESSIONALS FOR THE BIOPHARMACEUTICAL INDUSTRY OCTAVIO TONATIUH Director of UNAM’s Instituto de Biotecnología (IBt)

Q: What efforts has the institute made to push for more

at IBt, national regulatory authorities and industrial

and better trained local professionals covering a growing

partners. Thus, LAMMB supports industry throughout

market demand for biotech services?

various critical areas during biopharmaceutical product

A: The Institute has focused on four main strategies for

development and also supports government agencies with

promoting biotechnology. First, we held two open house

detailed independent characterization reports that sustain

events, during which visitors of all ages visit our Institute

quality, safety and efficacy claims required during product

to learn about biotechnology and our day to day work.

registration. The fourth strategy has been the publication

More than 100 different activities are designed by our

of a new magazine called “Biotecnología en Movimiento”

community including guided visits, seminars for amateurs,

or Biotechnology in Movement. The purpose of this

photographic exhibitions, hands-on demonstrations and

magazine is to describe in simple and friendly language

other activities. In 2016 584 members participated and

the on-going research at our institute as well as publishing

2,400 people attended, doubling the number of people

select information on relevant and new developments in

that attended in 2014. Most were undergraduate students,

all areas of biotechnology.

many of which applied for admission to our graduate program. This effort is complemented by visits from

Q: Which types of research are Big Pharma companies

different universities and elementary schools throughout

looking for the most and what are the main reasons

the school year.

behind this? A: At this point the industry is looking for expert advice and

Our second strategy focuses on the productive sector. We

highly specialized knowledge on product characterization

host seminars, ad hoc courses and private visits for the

during clinical and preclinical phases, process transfer and

industry, government and NGOs. In the last five years the

scale up. Mexican biotechnology still needs to advance

Institute has signed agreements with 40 different entities.

toward the development of new products and at this point

We aim to create bonds between the industry and our

the route to get products developed by Mexican academia

students many of which already work at key positions in

to the market is being paved.

non-academic institutions. Q:

What

companies

has

IBt

helped

to

develop

The third strategy has been the establishment of specialized

biotechnology practices and what makes the UNAM the

infrastructure to support not only academic activities but

best partner of choice for these types of activities?

also governmental and industrial needs. Central to this

A: IBt has worked with over 50 institutions. We have

effort has been the launch of the National Laboratory for

worked with companies in Mexico, Brazil, the US and

Production and Analysis of Biopharmaceuticals (LAMMB).

Australia, helping them in a variety of matters. New

This laboratory has state-of-the-art infrastructure and

drug development, product characterization, process

highly experienced and qualified scientists and technicians

scale-up, preclinical and clinical testing are all within the

in all areas related to the production and analysis of

expertise of the institute. With 100 researchers, many

recombinant proteins employed as active ingredients in

of whom are world leaders in their fields, the Institute

vaccines and therapeutics.

of Biotechnology is a unique place that conjoins a very strong basic science group with an equally strong

These areas include gene synthesis and transformation into

technology development and applied science group.

suitable cell hosts, cell culture or fermentation, downstream

Moreover, the IBt has been collaborating with the

processing and formulation and a thorough analytical

industry since its foundation. The Institute has a deep

characterization of the particular recombinant product.

understanding of the needs of the industry that has been

LAMMB acts as a link between basic research performed

acquired throughout the years.

205


| VIEW FROM THE TOP

BRINGING BEST PRACTICES TO MEXICO THOMAS CANTOR Founder and President of Scantibodies

Q: Who are Scantibodies’ main competitors?

lowered the price to only US$950 for the PET scan, which

A: The main competitor for the diagnostic kit manufacturing

is very reasonable.

is in-house producers. We want to extract that production

206

out of their company and do it ourselves. We have to show

Q: Which partnerships do you have with the medical

management the advantages of outsourcing with us. The

diagnostic community?

core of our imaging therapy is the PET scan and we don’t

A: After two years in Baja California, we have created three

really have much competition because we are the only

main partnerships. Our first is with insurance companies

supplier north of Monterrey.

all over Mexico, cancer clinics and hospitals because they need to get PET scans to monitor their patients, and the

Q: What services and products do medical tourists and

third is with private medicine in which our sales people

domestic patients most often require?

visit oncologists and doctors to show them the new

A: I got cancer in 2010 and used my personal experiences

technology in town.

to help learn about other people. After the initial shock, the patient asks what can they do to take care of themselves

Q: Is there a single breakthrough to be proud of in

and how do they monitor their progress after the cancer. I

diagnostic medicine by Scantibodies?

have witnessed that some doctors and hospitals, especially

A: In-vitro diagnostics, like blood testing, is something

in the US, follow the same guidelines for treating patients

the company has been doing successfully for decades

that are not necessarily catered to or are the best options

but nowadays people are more concerned with heart and

for that specific patient. Therefore, I have created here

cancer diagnostics. There are certain limitations for heart

a type of sanctuary where a patient can consult with a

diagnostics because the enzyme markers only tell you if

doctor for an hour and receive their options for treatment.

you have had a heart attack or damage to the heart, but there are not markers for your risks. Another breakthrough

Most of the services that medical tourists and domestic

that we are proud of is the profusion study with the MRI.

patients require are for cancer, diabetes or other diseases

For example, instead of getting a biopsy of a lump in a

like Lyme disease. The services they receive here center

woman’s breast, which could risk spreading the cancer

on the advantages of IV high vitamin-C doses and ozone

with the needle, the profusion study in the MRI shows us

therapy, which has been around for a long time and offers

in the video if the blood supply to the lump is set up for

many curative benefits.

cancer or not.

Part of our therapy is also J-27 juice. Years ago, I learned

Q: Scantibodies has no investors. How does this affect

about Dr. Max Gerson from Germany, who created the

your operations and how do you finance your business?

Gerson Therapy Juice that cured patients with tuberculosis

A: God has taken care of the financing of the business. For

and cancer. We then improved this juice recipe by fixing the

25 years I was in charge of my business and let God come in

microbe problem to make it more stable and we tested it to

and out of helping. After a lawsuit, I agreed that God was in

find that it shrank cancerous tumors in lab mice. We are not

complete charge of the business. I consciously asked God

quite sure how it works but it is a staple in our therapies.

to take the site in Tecate and make it His own and I believe He has kept us out of debt and without investors. This is

Imaging like CT, PET and MRI scans are also very important

a great advantage to us because investors want to make

in our treatment. Usually, a patient will be scanned at a

the decisions for the company and are just concerned with

high expense in the beginning and end of their treatment,

money, which is not our goal. So I feel blessed because I

but here we scan the patient throughout their therapy

have a purpose to be in this business, which is the business

to monitor its effectiveness. Because of this, we have

of helping patients.


| VIEW FROM THE TOP

THE RISING IMPORTANCE OF MEXICAN BIOTECH EDNA ÁLVAREZ Latin America Manager of Malvern Instruments

Q: How do Malvern’s activities solve predicaments for

Key

their clients?

absorption rates and content uniformity can all be

The past decade has seen biopharmaceuticals become the

affected by the particle size distribution of various

fastest growing class of therapeutic agent with increasing

components of a drug product. For example, reducing

numbers of novel molecules entering development every

particle

year. Underlying this is a fundamental shift in pharmaceutical

formulation of New Chemical Entities (NCEs) with poor

industry investment and emphasis. The challenges of

water solubility; thus getting a drug into pre-clinical or

moving from the development of small molecule drugs

clinical

to dealing with more complex biological materials are

attributes of pharmaceutical products in conjunction with

considerable and wide ranging. Malvern’s Bioscience

their chemical structure is also of great value.

performance

size

parameters

can

trials

speed

quicker.

up

such

as

dissolution,

pre-formulation

Understanding

and

morphological

Development Initiative (BDI) is an independent, agile and entrepreneurial organization. It partners with industry and

The morphology of drug particles, granules, topical

academia to rapidly identify and assess analytical problems

and

and bottlenecks within biopharmaceutical development

formulations provides information about bioavailability

and manufacture, and to prototype, develop and deliver

(BA) or bioequivalence (BE). Measurement of particle

solutions. Even though the company has presence in a wide

size and shape of the correct particle must be achieved

range of industries and countries the market determines

and techniques such as Raman spectroscopy, in tandem

Malvern Instruments’ approach and specialization. Latin

with image analysis, can provide an accurate, objective

America has just begun to demand life science applications,

and automated means to do this. Malvern Instruments

in line with the US and Europe. In return, we expect far more

has specialized technical personnel who are in regular

specialization in LATAM over the next three years.

dialogue with government agencies, such as COFEPRIS

Orally

Inhaled

Nasal

Drug

Products

(OINDP)

or the FDA in the US. This allows us to showcase new Q: How have the Malvern Bioscience Initiative’s (BDI)

technologies and explain best practices for the use of

efforts supported its parent company?

specific technologies and advise on data interpretation.

Malvern’s Bioscience Development Initiative (BDI) is an independent, agile and entrepreneurial organization. It

Q: How important is the Mexican market for Malvern’s

partners with industry and academia to rapidly identify

global strategy?

and assess analytical problems and bottlenecks within

In a move that reflects continued sales growth in Mexico,

biopharmaceutical development and manufacture, and

Malvern Instruments has opened a new office in Mexico

to prototype, develop and deliver solutions. The initiative

City. Operational since August 2013, the Mexico office

was established in 2012 to meet the evolving needs of a

provides both pre and after sales support to a growing

sector that is undergoing rapid change.

customer base. It is also the venue for an increasing number of advanced training courses and seminars and

Q: How does Malvern Instruments contribute to the

is part of Malvern’s operational expansion in Mexico and

Mexican pharmaceutical industry?

throughout Latin America. The opening of the office in

The particle size distribution of active ingredients,

Mexico comes just a year after the establishment of a

excipients,

important

sales and applications laboratory in Sao Paulo, Brazil.

physical characteristic of the materials used to create

Our investment continues with the launch of a Spanish

pharmaceutical products that have the right Quality

website earlier this year. There is great demand for our

Target Product Profile. It can affect product performance,

products and services within Mexico and strong customer

manufacturing scale up, processability and stability of the

relationships and exceptional service are the cornerstone

final drug formulation.

of Malvern’s business.

granules

and

droplets

is

an

207


| VIEW FROM THE TOP

DEVELOPING PROGRAMS TO COUNTERACT INFERTILITY JOSÉ ISLAS Director General of IVINSEMER

208

Q: One of IVINSEMER’s goals for 2016 was to increase

are the first company in Mexico to have brought life from

infertility awareness in Mexico. How has the company

a frozen ovule which was from a cancer patient. Through

moved forward in this regard and what communication

the Preserva program we bring awareness to woman that

mechanisms has it implemented?

will undergo oncology treatment that our treatment will

A: IVINSEMER has worked strongly on technological

eventually allow them to become mothers.

advancements as becoming pioneers in the reproduction field is contingent on our investments. This led us to an

Q: What is the strategy behind the Compromiso

alliance with the Valencian Institute of Infertility (IVI), a

IVINSEMER initiative?

global solution leader. Our merger has put IVINSEMER

A: IVINSEMER has developed an accumulated pregnancy

at the forefront in both technology and human capital

statistic throughout the years. As such, we know that

considering IVI’s Valencian foundation systemically works

couples that were successful in the treatment have a 90

in the creation of new fertility treatments. By joining their

percent probability of having a healthy baby. Compromiso

platform our services have improved while gaining an

IVINSEMER is divided into three sessions where we analyze

additional capital flow.

different parameters and adapt our treatments. If couples do not reach their goals after following IVINSEMER’s

Last year, IVINSEMER was comprised of six clinics. We now

medical orders the company partially reimburses them.

have a network of 12 with superior services. Some of them are equipped with an assisted reproduction laboratory as

Q: What is the price range of your services?

is the case in Mexicali, Guadalajara and Colonia Anzures

A: High complexity treatments go for US$9,000 including

in Mexico City. Franchising our brand has resulted in

drugs, doctor fees, diagnostics and blood tests. In the event

significant expansions in collaboration with MDs that have

of insufficient capital, we structure down payments and

received IVINSEMER’s training. Future expansions include

financial solutions. Unfortunately, public health institutions

Tuxtla Gutierrez, San Luis Potosi and Oaxaca.

servicing infertility are oversaturated as the government’s agenda is not focused on the problem. Besides their lack

Q: What new treatments from IVI’s technological platform

of service availability, their infrastructure and technology

have been implemented in Mexico, and how have they

is sub-par. Infertility remains a non-addressed public

been accepted in the local market?

health issue in Mexico, giving way to private clinics like

A: Preimplantation genetic diagnosis has had positive

IVINSEMER.

results in the market. It allows MDs to diagnose a wide range of diseases before transferring embryos to the

Q:

womb, improving its success rates by approximately 25

considerably more affordable than in other countries, will

Considering

fertility

treatments

in

Mexico

are

percent. In the past, we operated with a 50-55 percent

this service increase the medical tourism influx?

success rate. This technology has minimized disease

A: Fertility services are attracting patients from all over the

transfer from parent to child, such as hemophilia, anemia

world, which we are mostly benefiting from in our Mexicali

and cystic fibrosis to name a few.

facility. We are negotiating with medical facilitators in Phoenix and San Diego to further strengthen our clinic’s

We will soon see the entrance of the EmbryoScope

reputation. As members of the Latin American Network

solution to Mexico. It will allow us to record embryo

of Assisted Reproduction (REDLARA), IVINSEMER has

division in real time. The incubator stores and captures

proven its worth and quality. Mexico is lacking certificating

their evolution taking pictures every 30 seconds and

institutions, which has led to small companies with poor

facilitating our selection process. This technology is new in

procedures that negatively impact the industry by offering

Mexico and IVINSEMER will pioneer its establishment. We

deficient services.


| VIEW FROM THE TOP

REGENERATIVE MEDICINE: REJUVENATION AND DISEASE CURE JOEL OSORIO Director General of RegenerAge

Q: What led to the creation of RegenerAge, and what

with patients suffering from ALS, diabetes, hypertension,

main health problems can you prevent?

rheumatoid arthritis, sclerosis, scleroderma and lupus. Not

A: Smart prevention is the best treatment for any disease.

only can we treat different illnesses but we can also treat

Once an illness is part of a person’s life, human regeneration

patients at a variety of different stages.

is a great option for health to restructure damaged tissues and cells. Biotechnology advances provide a chance

Q: How can you expand your business to the more

to improve outcomes when a patient needs diverse

preventive end of the spectrum for patients who are not

medical treatments. Using a unique biopharmaceutical

yet sick or are only just beginning to show symptoms?

product, Bioquantine (BQ-A®), in combination with stem

A: The more a patient’s health deteriorates the costlier

cells we are able to offer an option for those who would

treatment will be. There are three ways we can convince

like their own bodies to activate the healing process

otherwise healthy patients to seek preventive treatment,

or keep themselves as healthy as they can for as long

the first of which is functional nutrition. Secondly, there is

as possible. We have created a system of different

bioidentical hormone replacement treatment for women

treatments including functional and regenerative based

and men over 45 and by maintaining a healthy hormone

diets, Bioidentical Hormone Replacement Treatments,

level in one’s body a patient can stay young for as long

skin regeneration and aesthetics. From this point, we

as possible. Finally, we offer aesthetic medicine derived

can guide the patient into adopting a functional style of

from PRP, which can revitalize and regenerate skin all over

nutrition because regeneration is borne from a specific

the body. This includes treatment of cellulite and adipose

diet plus bioidentical hormone replacement treatment,

deposits as well as skin tightening.

which is the proper use of Human Growth Hormone. Prior to a patient’s regenerative medical performance I have

Q: Given the fact that regenerative treatment is a new

to order different lab tests to decide which patients are

technology, how are you working to make its incorporation

candidates for each treatment. Platelets Rich Plasma

into healthcare plans possible?

(PRP) is one option - from the skin surface to knees joints.

A: Approved stem cell treatments have been on the

Another is a stem cell booster or stromal cells, made of

market for at least seven years. The use of human

the live cells from human placenta. This one has to be

placenta to boost stem cells is also an old technique that

implanted within the subcutaneous tissue of the patient’s

was discovered about 75 years ago in Russia. In terms

body. The company’s recent human regeneration project

of mesenchymal stem cells (MSC) treatments, the new

has attracted worldwide media attention after announcing

feature we are adding in our system is BQ-A. Our extract

BQ-A extract is going to be used to treat deep coma or

itself has been researched for around 30 years and is

brain dead patients. BQ-A contains 93 polypeptides,

derived from an amphibian that is able to regenerate itself.

proteins that work on the development and repairing of

It is only now that research has become state of the art,

human DNA.

which is why we have recently targeted it.

Q: What have been some of the results you have seen and

Q: What are your priorities for 2016-2017?

what cases demonstrate your success?

A: We will start working in different locations in Mexico,

A: I was treating a patient suffering from stage 4 pancreatic

and are in talks with private hospitals that are extremely

cancer, which is one of the most aggressive cancers one

interested in the project. This could be implemented

can contract. After treatment over a few months of using

in Puerto Vallarta, Ciudad Juarez, Cancun, Mexico City,

BQ-A, the patient’s lifespan was increased by one year.

Puebla and Cuernavaca. We need to initiate protocols and

When I first started treating the patient her prognosis

the first step will be the ReAnima project, which deals with

was three to four weeks. I have had positive outcomes

neurological regeneration.

209



10

AESTHETIC MEDICINE & SKINCARE

The global dermatology market was valued at US$20 billion in 2015, according to PRnewswire, and is projected to grow. Investment in new products and strategies continues. The sector accounts for 6 percent of the pharma market, say industry experts who expect the dermatology market to grow 3-4 percent this year and next. Worldwide, the aesthetics and cosmetic segment is enjoying growth, with Mexico in fifth place for the number of surgical and nonsurgical procedures performed annually. To stay ahead of the crowd, companies are investing in newer and more innovative technology.

Demand for natural or vegan products and ingredients is an emerging opportunity and an increasing number of companies in Mexico are choosing to specialize in this niche. Although regulations already are tight in certain areas of natural and vegan products, some foresee stricter controls to come with the change in COFEPRIS leadership. This chapter will present insights from the Mexican aesthetic medicine and skincare industries and will look at expected challenges in addition to growth expectations.

211


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| CHAPTER 10: AESTHETIC MEDICINE & SKINCARE 214

ANALYSIS: Growing Opportunities in Aesthetic Care

216

VIEW FROM THE TOP: Carlos Berzunza, CANIPEC

218

VIEW FROM THE TOP: Ricardo Spinola, Farmapiel

219

VIEW FROM THE TOP: Geraldine Waked, Sesderma

220

VIEW FROM THE TOP: Carlos de Kruyff, CDM Labs

221

VIEW FROM THE TOP: Corrado De Gennaro, Galderma

222

VIEW FROM THE TOP: Alejandro Grisi, Grisi

223

VIEW FROM THE TOP: Alejandro López, IM Natural

224

VIEW FROM THE TOP: Ariel Díaz, Kaloni Holding Group

225

VIEW FROM THE TOP: Víctor Anaya, Merz Pharma

226

ANALYSIS: High Growth Potential for Aesthetic Surgery

227

VIEW FROM THE TOP: Fernando García, Tijuana Bariatrics

213


| ANALYSIS

GROWING OPPORTUNITIES IN AESTHETIC CARE In 2015, Mexico occupied fifth place globally in the

at US$1.3 billion, says CANIPEC. Considering market

total number of cosmetic procedures, stacking up an

fluctuations and the depreciation of the peso against

impressive 907,913 elective surgeries, according to the

the dollar, this shows a strong industry poised to grow.

International Society of Aesthetic Plastic Surgery. The

Carlos Berzunza, Director General for CANIPEC, says

country fell behind the US, Brazil, South Korea and India.

that on average the sector grows 4-5 percent annually and this year will be no exception.

With an obesity problem plaguing Mexican society as well as the transformation of the country into a medical

In the past decade the country has attracted US$300

tourism hub for bariatric surgery, there is no doubt

million in foreign direct investment annually, thereby

Mexico’s aesthetic industry is thriving. According to

creating an industry that provides more than 200,000

Fernando García, Director of Tijuana Bariatrics, 98

direct and indirect jobs, he adds.

percent of his patients are international and only 2 Berzunza says 96 percent of Mexican personal care

percent are domestic.

products exported stay in the continent, with over half 214

Data from the National Chamber for the Cosmetic

going to the US. This creates a multifaceted market

Products Industry (CANIPEC) states that personal care

with a large catalogue ready to cater to international

products represent 1.2 percent of Mexico’s GDP, which

markets.

makes it the second largest beauty market in Latin The industry’s exports are driven by numerous treaties

America after Brazil.

the country already has including the Pacific Alliance, In an official statement, Expo Feria de la Belleza y el

its negotiations for the Trans-Pacific Partnership (TPP)

Estilismo or Expo EBIO 2016, one of the industry’s

and the Panama Free Trade Agreement. CANIPEC

leading events, states that only 20 percent of Mexican

is also negotiating tariff reductions and commercial

households own at least one personal care product and

facilitation for beauty products through the Economic

that 70 percent of all merchandise available is directed

Complementation Agreement with Brazil, says Berzunza.

to females. This leaves significant room to grow the Mexican beauty industry from a mere US$10.5 billion in

Skincare is also an important issue that is being targeted

2015 to USUS$14 billion in 2020, according to Mordor

by the market. Corrado de Gennaro, General Manager

Intelligence.

Mexico & Central America for Nestlé’s Galderma, says 70 percent of the Mexican population is afflicted by

Last year beauty exports surpassed US$2.5 billion

some variety of skin disease, which would explain the

while imports amounted to a little more than half that

company’s emphasis on R&D and the registration of 55 new patents since 2014. According

to

Euromonitor,

dermatologicals

are

anticipated to increase by a value compound annual growth rate (CAGR) of 3 percent at constant 2015 prices, to reach MX$6.6 billion (US$358.1 million) by 2020. According to Carlos Kruyff, Partner and Managing Director at CDM Labs, this growth includes dermocosmetic and skin disease medicines and it still barely covers inflation. Kruyff says, though, that in the past dermatologists sneered at the aesthetic and corrective industry but the tide has changed as proven

Mexico ranks fifth globally for aesthetic procedures, with over 4 percent of the

world’s total

by growth percentages. Farmapiel plans to launch 13 new products this year, adding to the 18 launched in 2014, says Ricardo Spinola, CEO of the company. “Beauty is becoming a relevant topic and today we see people in their 60's and 70's looking like 50-year-olds.”


MEXICO PERSONAL CARE TRADE BALANCE (US$ millions) MEXICO PERSONAL CARE TRADE BALANCE (US$ millions) 2,500

2,230

2,000

2,191

1,776

1,089

1,164

1,500

1,341

978

915

781

562

1,000 500

2,106

1,894

996

780

0

2010

Imports Imports

1,065

979

2011 Surplus Surplus

2012 Exports

1,102

2013

1,128

2014

2015

Exports

Source:CANIPEC Source:CANIPEC

He emphasizes though that chemotherapy patients are

provided by the company lasts 14 months they welcome

also pushing the market, looking for products to counter

their clients for lifelong follow-ups.

the effects the treatment has on their skin. Diabetes, one of the leading conditions in Mexico, is also a driver for

Euromonitor states that in 2015 Procter & Gamble

skincare.

Mexico continued to lead hair care, accounting for a 21 percent value share. The company owns several brands

To ensure success, Sesderma focuses its sales strategy

including Head & Shoulders and Pantene, which are in

on medical practitioners as they represent 80 percent

the top five hair care brands in the country.

of their revenues. The company has only added 20 sales points for over the counter (OTC) products, which

CDM Labs is investing most of their capital in capillary

strategically cater to the practitioners' preferences.

care and hair products, pigmentation skincare and

“Sesderma had to lower pharmaceutical points that

skin blockers hoping to grow domestically and put off

were no longer profitable such as Sanborns, which

exports, says Kruyff.

was dropped from 40 to 20, and San Pablo, cut from 50 to 30,” says Geraldine Waked, Director General of

However, in the baby shampoo market Grisi is still

Sesderma.

leading the pack after launching Ricitos de Oro, the country’s blockbuster shampoo, 26 years ago. According

Merz Pharma is focusing on bringing to Mexico a new

to Alejandro Grisi, the company’s Director General, the

cellulite correction device known as Selfina, which

star chamomile product still represents 40 percent of

has already been approved by the Federal Drug

the national market share.

Administration (FDA) and exists in the US market, says Victor Anaya, CEO. The company is also proud of its

Grisi is focusing on the development of natural-based

botulinum toxin, which is the only one in the market

products including soaps, which are now made from

that does not contain complex proteins, minimizing side

vegetable oil. Alejandro López, Director General of

effects.

IM Natural, says the company prefers to invest in the quality of their natural products instead of marketing,

In 2015, the largest market dermatological competitors

and therefore they focus on multilevel programs and

were Genomma Lab Internacional with a 35 percent

catalogue sales for their revenue. Their high-quality

value share and Bayer de Mexico with an 11 percent

mascaras are also conquering new grounds in the male

share, claims Euromonitor. Both have continued double-

grooming sector.

digit growth. López foresees that the beauty products market could Hair loss is another trend driving the market in Mexico.

be growing at rates of about 11 percent by 2019, propped

As in the rest of the world, this is the number one

up by research efforts to find new ingredients and

aesthetic concern for men and one of the main concerns

solutions and more professionals entering the sector.

for women, says Ariel Díaz, Co-founder of Kaloni Holding

“Mexico is an attractive investment and distribution

Group. Up to 40 percent of men suffer from some kind

destination adding to the positive outlook we have on

of alopecia, he adds. Therefore, though the treatment

the future.”

215


| VIEW FROM THE TOP

BUSINESS PUSHES FORWARD VIA TRADE AGREEMENTS CARLOS BERZUNZA Director General of CANIPEC

216

Q: What specific strategies is CANIPEC enforcing to gain

Q: How do you make sure that the personal care and

more competitiveness in the Mexican market?

household care product industries take advantage of the

A: Our aim is to gain competitiveness in the personal care

export opportunities Mexico provides?

and household care products industry. Our products play

A: Mexico has a solid investment platform being Latin

an important role in the daily lives of Mexican consumers.

America’s largest exporter of personal care products.

Improving conditions for doing business in the Mexican

Our industry has achieved exports diversification. Around

arena is important. We are pursuing many initiatives with

52 percent of our exports go to the US and the rest go

a priority being the communication between the industry

to other Latin American and Caribbean countries, which

and the consumer.

means that a total of 96 percent of our exports stay on the continent. However, we still have work to do to make sure

Besides complying with the authorities’ regulations

that the conditions in which Mexican exports happen are

regarding

self-

the best possible. We maintain constant communication

regulation code called COSMEP, which includes ethics

advertising,

CANIPEC

developed

a

with Mexican trade agreements negotiators to make sure

guidelines for the advertising of affiliated enterprises.

our products receive the best possible treatment regarding

However, it is not an exclusive code and is open to any

tariffs and market access. We have a very active industry

other company that might want to adhere to it. Several

on the exports market. Cosmetic products exports amount

associations such as AMAP and CONAPEC have accepted

to US$2.8 billion. When added to household care products

our COSMEP code. These agreements help enterprises

we arrive at a total of US$3.6 billion with a trade surplus

maintain communication among them but also make them

of US$1.7 billion.

vigilant of each other making sure everyone complies with the regulations. Complementing authorities’ regulations

We have done many things to achieve high export figures.

with self-regulation has been an interesting experience.

Our most recent accomplishments have been the Pacific

Thanks to this, we have been able to develop better

Alliance negotiations. For this particular agreement, we

advertising, which has evolved into increased confidence

wanted to take advantage of the opportunities the free

from our clients and improved communications with the

product flow segment offers. Cosmetics chambers in

authorities.

the four countries involved proposed a common agenda for eliminating tariffs, flexible origin rules, homologated

The personal care and household care products industry

regulations and a document with international best

was recognized by the Ministry of Economy as a key

practices for the industries. Around 90 percent of our

sector for the Mexican economy, so we have been working

proposals were accepted by our governments. The idea

with them very closely to identify opportunities for

behind this joint effort was to eliminate requisites that

strengthening supply chains and to raise awareness among

do not provide added value to consumers’ safety and are

consumers about the benefits that come from using our

time-and-resource consuming.

products. There are several products we sell that improve life quality but do not have the consumption levels they

We took the same approach in the Trans-Pacific Partnership

should have, like hair conditioning and sunscreens. That

(TPP)

is why it is so important to promote an informed and

countries wrote position papers in which we proposed a

responsible usage of products, encouraging consumers

common agenda for negotiators. At the moment we are

to adopt products from formal establishments rather than

participating in talks for the extension of the Economic

informal venues where there is no institution or authority

Complementation Agreement with Brazil, the largest

that takes responsibility if the product causes an adverse

market for beauty products in Latin America, so we need

reaction.

to work on tariff reduction and commercial facilitation.

negotiations.

Chambers

from

the

involved


Q: What are the positive economic effects CANIPEC has

our consumers with more sources of information. But

on the Mexican Industry?

consumers also need to inform themselves regarding the

A: Our industry has an extensive catalog that adapts

products they use. Maintaining an open communication

to consumer needs and possibilities. There are many

channel with the government is vital. Fortunately, we

affordable products and several premium products. Our

have established a relationship of trust and constant

products amount to more than US$9 billion. This magnitude

communication, especially with the Health Ministry

of product consumption generates an important effect on

and COFEPRIS. They have accompanied us on our self-

the country’s economy. Our estimations show that over

regulation processes and in our efforts to negotiate our

200,000 jobs are created, either directly or indirectly, by

free trade agreement regulations. Another important

our industry.

authority we maintain constant communication with is the Ministry of Economy. Government support is

Our growth in the local market has attracted investment.

fundamental to many processes, for example trade

Personal and household care have grown at rates of 4

agreement negotiations. We are partners with the

percent and 5 percent per year, respectively, In the last

government regarding the observance of applying

decade the industry has attracted more than US$300

existing regulations and upgrading them. We have had

million in foreign direct investment annually. We have

openness from the federal government, we have been

seen significant amounts of investment in the past five

able to maintain communication and we have generated

years in plants and research centers. That is why our

agreements.

goal is to achieve a solid double-digit growth. This can

creating synergy with the government is vital for the

be done by maintaining the growth of products that are

success of the industry.

Communication

with

consumers

and

already being consumed and increasing the consumption of products that have yet to be accepted by the market. The 68 enterprises that make up CANIPEC are having an impact on the economy. To increase our impact we are developing new services to help small enterprises that develop artisanal products. Additionally, we believe there are some enterprises in the chemical and manufacturing

“Personal and household care have grown at rates of 4 percent and 5 percent

industry we could affiliate in the next years.

per year, respectively. In the

Q: What steps are you taking to improve opportunities in

last decade the industry has

the Mexican market? A: Improving consumer culture is important. Mexican consumer habits are influenced by their beliefs. If people believe that hair conditioning triggers hair loss they are definitely not going to buy it even if it is not true. Erasing these myths is a double responsibility. We are doing what we can to improve our communication and provide

attracted over US$300 million in foreign direct investment annually� Carlos Berzunza, Director General of CANIPEC

217


| VIEW FROM THE TOP

CAPITAL COOPERATION IS KEY TO EXPANSION RICARDO SPINOLA CEO and Founder of Farmapiel

218

Q: What are the latest trends in the dermatological segment

of this venture have been positive. We have been able to

and how does Farmapiel capitalize on them?

take some opportunities that would otherwise have been

A: Mexico has an aging population, more effective medicines

out of reach such as product acquisition, technologies,

to treat chronic diseases and a population that wants to

the manufacturing plant, brands, trademarks, product

look young and healthy. Beauty is becoming a relevant

registrations and company investment. Last year we

topic and today we see people in their 60s or 70s looking

launched 18 products and this year we will launch 13 more.

like 50-year-olds thanks to the growing trends in esthetic

We expect to maintain this aggressive strategy to continue

medicine, such as plastic surgery and corrective medicine.

growing mainly in the prescription market. Some of the new

People are interested in taking care of their skin, which is

products were in the market before and we will relaunch

driving the growth of skin protection products and raw

them. Others are new formulas we released in the US and

ingredients, such as emollients, vitamins, clarifying agents

Europe and we are now bringing to Mexico.

for spots and active compounds for conditions like acne. Ten years ago, it was uncommon for adolescents or the

Exports certainly take time but we are moving ahead and the

general population to attribute much importance to acne

regulatory process requires patience. When looking at Latin

whereas today treatment is a priority. Moreover, there are

America, Mexico is one of the biggest established productive

many patients living with cancer who require more skincare

markets and is also economically and socially stable, which

products to counteract the side effects of chemotherapy

is not the case for other major countries in the region. This

and conditions like diabetes serve as another driver for

represents a competitive advantage for Mexico so it is just a

specialized skin products. We are focusing on product

matter of seizing the opportunity. Our plant in San Juan del

development to create differentiated products through

Rio has the installed capacity and expertise to participate

specialized technology to capitalize on these trends. New

in other markets. At the moment we have not explored

formulations are developed within the company, and we

options such as support from ProMĂŠxico because we are still

have a laboratory in San Juan del Rio where we carry out

focusing on consolidating the business in the country but we

this activity. We are constantly seeking new ingredients and

are aiming to grow into other markets this year.

materials that provide differentiation not only for our own production but also for third-party manufacturing where we

Q: To what extent will funding from EMX Capital pave

offer high-quality raw materials.

the way for other companies looking for this kind of opportunities in Mexico?

Q: Last year, you invested in the manufacturing site in San

A: I truly believe this is setting a precedent for companies

Juan del Rio in an attempt to reach new markets like the US

willing to raise funding. This is a matter of learning how

and Latin America. To what capacity is the plant operating?

to work together. We are experts in launching products

A: We received COFEPRIS’ approval last July to manufacture

and acquiring technology while the capital was provided

semi-solids, oral solids and liquids including dermatological

by EMX Capital along with their knowledge on corporate

liquids, creams, ointments and gels. In addition, we obtained

governance and their business and banking contacts at the

a Good Manufacturing Practices (GMP) certificate and we are

international level. It is important for us to always see the

already carrying out third-party manufacturing. Farmapiel is

big picture and realize that increasing our capabilities with

about to obtain registration for semi-solid products and we

the support of someone else enables us to expand more

are starting to manufacture dermocosmetics in the plant.

easily together. This is a promising path to follow not only for dermatological and pharmaceutical companies, but EMX

We received funding from EMX Capital for the overall

Capital covers many other industries. EMX Capital stands

project including the expansion of our operations and

out due to its corporate governance, formal organizational

establishing the manufacturing site and so far the results

structure and relationship with capital markets.


| VIEW FROM THE TOP

MEXICAN BEAUTY MARKET PROVES ATTRACTIVE GERALDINE WAKED Director General of Sesderma

Q: From 2014 to 2015, Sesderma’s consolidated sales

Q: Which products have had a bigger impact in the

reached 38 million euros (US$42.19 million). What role

Mexican market?

did the Mexican market play in these numbers?

A: So far, our genocosmetic products have had the most

A: Since we entered the Mexican market three years ago,

impact in 2016. This treatment draws from DNA to prolong

sales have shown positive growth. In 2014 business in

the life of telomeres and consequently cells. Sesderma’s

Mexico doubled and we are hoping that 2016 will follow

biggest innovations of the year include our retinol

the same trend. Our sales derive from two areas: doctors

development that stimulates elastin and collagen to

and pharmacies. Sesderma prioritizes practitioners as the

reduce wrinkles with few applications. Reti Age and Factor

company is made by and for dermatologists.

G were launched last year at the Dermocosmetic Congress and have been particularly successful in terms of volume.

The company collaborates closely with doctors to solve

Factor G incorporates plant-based growth elements. Reti

common dermatological issues centered on beauty and

Age reduces wrinkles up to 80 percent and causes almost

health for both men and women. We have earned the trust

immediate changes upon application.

of doctors who feel comfortable prescribing our products. Q: What is Sesderma’s strategy for points of sale? The most attractive aspect of our brand is our OTC

A: Overall, we have added 20 points of sale since last year.

product range that can be found in pharmacies. Our

The growth is not massive and carefully adapted to the

products range from medical peels that need to be

preferences of practitioners. Sesderma has had to lower

applied by professionals to complimentary products such

pharmaceutical points that were no longer profitable such

as face washes and creams found in pharmacies. Our OTC

as Sanborns, which was dropped from 40 to 20, and San

products have active ingredients and basic concentrations

Pablo, cut from 50 to 30. On the other side, Derma is a

that doctors prescribe for continuous treatment.

consistent sales outlet and we make sure to be present in as many branches as possible. Our marketing objectives

The world and Mexico in particular is starting to pay more

are targeted to medical practitioners as they do 80

attention to the skin as it is the most exposed organ to

percent of the work in sales. Practitioners are our forte as

external factors like pollution and stress. The country

people trust and believe their recommendations.

is starting to worry more about spots, wrinkles and aesthetic issues.

Q: Transnational companies tend to use Mexico as a platform to enter Latin America. What other countries in

Q: As mentioned Sesderma has two distribution channels,

the area is the company interested in entering?

pharmacies and doctors. Where is the market driving

A: Sesderma is already widely spread in the region. We

these channels?

affiliated with the US at the same time as we entered

A: Mediderma and Sesderma are our two lines. Despite

Mexico. The brand opened branches in Panama, Dominican

the fact that practitioners are our main pillar, we make

Republic, El Salvador, Costa Rica, Ecuador, Guatemala,

sure that our retail market is as strong as our medical one.

Peru, Guatemala and Brazil. The company is participating

Pharmacies have a strong drive as not all doctors provide

in even more countries as a distributor. Sesderma entered

medicine at consultancies and rely on prescriptions.

Panama, the Dominican Republic and Ecuador. These

Sesderma accounts for 70 percent of our sales while

branches were recently turned over to their country

Mediderma represents 30 percent, because our OTC

managers. We believe that our Mexican branch will be as

products have a general purpose like hydration, night

big as our Colombian one in two years. It is an ambitious

treatments and face washes while our medical products

goal considering that Colombia has a 10-year advantage

serve a more defined purpose such as peels.

and a double-digit market.

219


| VIEW FROM THE TOP

FOREIGN PRODUCTS SUPPORT LOCAL GROWTH CARLOS DE KRUYFF General Manager of CDM Labs

220

Q: CDM Labs is looking to expand its participation

A: Natural products are increasingly demanded around

into different markets. What new opportunities is the

the world, taking the form of phytopharmaceuticals. This

company targeting?

type of pharmaceutical has been clinically proven and is

A: The dermatology field has three different branches:

backed up by most physicians. As such, it has specific

clinical dermatology, which focuses on skin disease

therapeutic effects on conditions like rosacea and atopic

treatment, all other dermocosmetic fields serve as

dermatitis (AD). The latter has huge market opportunities

coadjutants to the aforesaid conditions, and surgical

as children contract the disease at high frequency. But

procedures covering both the aesthetic and dermatology-

there are some who remain skeptical about the benefits

related fields. CDM Labs is merely involved in the clinical

of phytopharmaceuticals and it is crucial the rest of the

area of dermatology, but the company is looking to expand

population understand their importance. On a positive

its scope into surgical and aesthetic-related procedures

note their success in European markets will most certainly

as it is the fastest growing segment in dermatology. Last

permeate into Mexico and Latin America.

year, the pharmaceutical market as a whole grew by 6 percent. Contrarily, the dermatology market, which involves

Q: Which socioeconomic spheres is CDM Labs targeting

desmocosmetic, and skin disease medicines fell short at 3

the most?

percent, which is barely enough to cover yearly inflation. In

A: CDM Labs covers most market segments but a large

the past, dermatology specialists were against the aesthetic

volume of our products are destined to the C+, upper

and corrective industry but the tide has changed as proven

middle

by growth percentages.

services the A/B and C+ social spheres. Nonetheless,

socioeconomic

class.

Our

luxury

portfolio

some of our products fit different demographics with Through mergers and acquisitions companies have

different consumption capabilities. We have evaluated

inorganically grown in this segment, concentrating their

the possibility of commercializing generic products that

efforts somewhere else. Big pharma companies with major

could further expand our market reach, however, nothing

market presence have some participation in dermatology

has materialized. What is certain is that lowering prices is

while those who do not are still holding back believing

essential as all types of societies need solar protection. A

it is responsible only for minor market volumes. In the

way to accomplish this is by cheapening packaging costs

pharmaceutical industry, dermatology accounts for 6

mainly by using environmentally friendly materials.

percent of the market share. This represents considerable opportunities for CDM Labs as we are solely focused on

Q: What products commercialized by CDM Labs see the

this. Bringing new and innovative medical solutions to

most success?

the market is not an easy task as COFEPRIS’ regulations

A: We commercialize a large number of products but

continue to tighten. As a result, we are bringing foreign

we are investing most of our capital in three categories

medications to the market, especially from countries

of products, including capillary care and hair products,

with high standards, and certification requirements such

pigmentation skincare products and skin blockers, which

as the US, Canada, France, Germany and Italy. Currently,

is a very congested market with multiple players. There

dermocosmetic

sanitary

are high margins for opportunity in Mexico putting a

registration, which allowed us to boost our portfolio.

products

do

not

require

hold on our export endeavors. There is a lot of room to

However, we foresee that Julio SĂĄnchez y Tepoz, the newly

improve domestically and our efforts will be channeled

appointed Commissioner of COFEPRIS, will change this.

into meeting our expectations. CDM Labs is looking to help Mexican society by commercializing state-of-the-art

Q: What are the current market trends in the dermatology

and innovative solutions in-house. There is a long way to

care arena?

go in terms of product coverage.


| VIEW FROM THE TOP

MEXICO SKINCARE MARKET LOOKING GOOD CORRADO DE GENNARO General Manager Mexico & Central America of Galderma

Q: What role does Mexico play for the global strategy of

rates encountered in lower socioeconomic spheres. At

Galderma?

the very least, 3,000 skin diseases are thought to exist.

A: Mexico is considered a strategic priority for Galderma.

Mexico continues to fall short when compared to mature

Gaining recognition as a worldwide pre-eminent authority

markets in the skincare and dermatology fields, such as

on skin health is a priority. Since its establishment in

Europe, North America or other Latin American countries

1995, Galderma Mexico has partnered with healthcare

like Brazil and Argentina. However, the country’s low

professionals (HCPs) providing medical solutions in the

penetration poses growing opportunities moving forward.

skin health field. This has contributed to Galderma’s steady

The needs and expectations of consumers change as

and systemic double-digit growth, becoming one of the

mortality rates drop worldwide. Global trends show that

top players in the dermatological arena. The company

consumers seek to feel and look better. The attention

competes in three specific market segment including

placed in skin senescence is growing as most people want

prescription (Rx) and OTC drugs, as well as aesthetic and

their skin to overcome the challenges of time. As such,

corrective treatments.

looking and feeling better while playing an active role in society is becoming more critical.

They all deliver sustainable growth exceeding average market rates, and positioning our brands among the

To achieve emotional and physical stability, consumers

preferred ones by healthcare professionals. In terms of

are looking for solutions that will get their skin back to

revenues, Mexico is within the top 10 countries in the world

its best natural look. Although Mexico’s demographics are

for Galderma and among the top emerging markets.

mostly comprised by younger people they will eventually age, increasing the market’s demand for skin health care.

Q: What is the importance of Nestle’s acquisition of

As the demand for dermatology services increases the

Galderma and what transformation has it brought to the

role of HCPs will consequently evolve. Considering the

business?

dermatologist to patient ratio in Mexico is of approximately

A: Nestlé is the leading nutrition, health and wellness

1:75,000, other medical practices such as pediatricians,

company in the world. Acquiring full ownership of

geriatricians and general practitioners will be expected to

Galderma helped the group create Nestlé Skin Health,

deal with mild to moderate skin conditions. Meanwhile the

further solidifying its vision of enhancing society’s quality

demand for dermatologists will continue to rise.

of life by delivering science-based solutions over the course of people’s lives in skin, hair and nail health. This

Q: What kind of investment does Galderma direct to its

will expand the reach of Galderma’s services and products

R&D operations?

not only for healthcare professionals and patients but

A: Galderma’s R&D operations focus on growing needs

also for everyday consumers. Under Nestlé Skin Health,

within the self-medication and esthetic and corrective

Galderma will continue to leverage its strong heritage

dermatology fields. Although R&D centers have not

and competencies, meeting the requirements of the

been established in Mexico so far, our facilities in France,

pharmaceutical and medical device environments with the

Sweden, Switzerland, the US and Japan continue to help

help of its prescription and self-medication divisions, as

us in this endeavor. In 2014, Galderma ran 78 clinical

well as its aesthetic and corrective products.

studies in 275 sites spread around 14 countries. So far, 23 of them are in phase IV, with a total of 6,905 enrolled

Q: What growth have the skin care and dermatology

patients. In return, we saw 55 new patent registrations.

segments seen in Mexico?

We look to maximize capacity and boost our efficiencies,

A: Up to 70 percent of Mexico’s population is affected

delivering high quality and safety while improving costs

by some variety of skin disease with higher exposure

due to larger production volumes.

221


| VIEW FROM THE TOP

LEVERAGING PAST EXPERIENCE FOR FUTURE STRENGTH ALEJANDRO GRISI Director General of Grisi

222

Q: What would you say is Grisi’s biggest strength in the

respective bioequivalence and dissolution test have been

Mexican market and what is its commercial structure?

performed. This process can take up to nine months

A: Grisi supplies almost every supermarket and pharmacy

excluding the component evaluation period where we

in Mexico. In addition, the government is responsible

identify the market’s demands. We cover a wide range

for a small part of our generic product sales. We do not

of applications like anxiolytics, vasodilators and calcium

sell directly to them but through distributers that orbit

related products.

the segment. On the other hand, the company’s US commercialization activities are mostly supported by

Q: What are the most relevant trends in the personal

Midway Importing, of which we own 52 percent of shares.

and skin care market and what is your fastest growing

Midway Importing is responsible for 80 percent of Grisi’s

product line?

sales in the US market.

A: The personal care market segment is extremely broad, and is mostly comprised by transnational companies.

Q: Grisi has a tradition of developing products from

Local market tendencies initially come from Europe and

natural sources. Has it been difficult to remain loyal to

the US, followed by Mexico. Dermocosmetics has become

your basis in an industry highly dependent on chemically

the latest trend as it follows hygiene and beauty formulas

synthesized substances?

while

A: Grisi’s R&D department continuously modifies and

alongside its European brand Maja, is positioned in El Corte

implementing

pharmaceutical

practices.

Grisi,

advances the company’s formulas for its pharma, hygiene

Inglés. Both have higher degrees of active ingredients

and

for

adding product functionality. Maja was acquired four

natural-based products are tighter than before, forcing

years ago and it specializes in perfumery. Although it is

us to systemically modify and improve our formulas.

not a premium brand its greater quality positions it in the

Considering less impactful ingredients are needed Grisi

masstige category. Our Mexican blockbuster is Ricitos de

partnered with international companies focused on

Oro, the country’s baby shampoo market leader with more

raw material production and jointly developing the best

than 40 percent of the market. With 26 years in the market

possible formulas for its products. In terms of natural

Ricitos de Oro resulted from Grisi’s original chamomile

extracts we purchase them from multiple regions in the

shampoo. The company also has a strong presence in the

world, such as the chamomile that is later processed in-

neutral soap segment, which is the highest selling soap in

country. Soaps, on the other hand, are now made from

Mexico. We are also leaders in the minimarket veterinarian

vegetable oil instead of animal fat. The trends behind

segment with our Perro Consentido and Perro Agradecido

natural product manufacturing have become stricter,

product lines.

beauty

segments.

The

industry

standards

especially as companies misrepresent and falsely promote their goods. Evidently, it is near impossible to have 100

Q: Grisi invested MX$100 million (US$5.3 million) on a

percent natural products as some types of chemicals are

new distribution center. What are the highlights of this

used for their preservation. We do our best to keep in line

investment?

with the company’s vision. Grisi’s active, natural origin

A: We will move our operations by mid-2016 to gain

ingredients must be of the utmost quality.

connectivity with our client’s distribution centers. Grisi’s distribution center services its warehouses in Guadalajara,

Q: What generic products is Grisi developing?

Monterrey and Tijuana. But more space is greatly

A: Grisi produces tablets and capsules. Our portfolio

needed. We are also refurbishing and strengthening

also includes salt compounds like epinastine, tamsulosin,

the infrastructure of our manufacturing facilities. Large

alprazolam and imiquimod. We research nearly expired

investments have been channeled to this endeavor, which

patents further filing product registrations once the

has positively impacted the quality of our pharma products.


| VIEW FROM THE TOP

GROWTH ON TAP FOR NATURAL BEAUTY PRODUCTS ALEJANDRO LÓPEZ Director General of IM Natural

Q: What inspired you to create IM Natural, a Mexican

Catalog sales are also an important commercial channel for

cosmetics company that creates its products with natural

the company representing a good portion of its business.

ingredients?

It is necessary to point out that through these efforts we

A: Twenty-five years ago, natural ingredients became the

are helping segments of Mexican society activate the

newest market trend. As a result, creating a cosmetics

economy. The multilevel program has proven to potentiate

brand with natural raw materials was something we felt

sales in the cosmetic and wellness industry.

223

a strong pull toward but we also understood that adding preservatives was necessary. IM Natural and its staff also

Q: How are market trends shifting considering cosmetic

worry about nature and its integrity. What we first thought

products are now also demanded by males?

would be a passing trend actually became a way of life for

A: Male consumption of cosmetic products is on the

consumers as can be seen in the market’s consumption

rise. In fact, our mascara portfolio has a transparent eye

habits. Back in the day, only a few nature shops could

liner for men that want to improve their features. Even

be found in the city, making for our first commercial

though this is a product that we export, for the most part

clients. In fact, the well renowned brand Nutrisa became

Mexican consumers are also joining the trend. There is

our first partner, later becoming the chain that it is

an uncanny amount of male-directed cosmetic products

today. Natural shops have since multiplied, opening up

and they vary in type and application. IM Natural’s

commercialization channels across the country. What is

transparent mascara was released in Mexico but it was

undeniably true is that natural, organic and vegan trends

not well accepted by consumers. Contrarily, its demand

have overtaken the market and companies with a long

in Costa Rica continues to grow, making for our largest

trajectory in these types of activities are one step ahead

consumer market.

of the curve. Q: How are IM Natural’s products reaching larger Q: As of today, international brands take up most of

population

the world’s cosmetic market share. How is IM Natural

product awareness?

positioning itself to overcome these challenges?

A: It is predicted that in a five-year period the cosmetic

A: Through a few star products IM Natural has captured an

market will grow exponentially and IM Natural will

important share of the market. This is especially true in our

certainly secure some of the growth. Even though

mascara range considering it is the leading portfolio in the

the pharmaceutical industry has only reached single-

natural arena. Consumers in our line of business not only

digit growth in the past few years we believe the tide

know what they want but also understand the intricacies

will change. Although this may be true there is a huge

of a solid cosmetic product. Keeping this in mind, IM

difference between the pharma and wellness industry, as

Natural’s biggest challenge has been securing sustained

well as in the challenges that they face.

segments

and

helping

increase

natural

growth. Rather than investing heavily in marketing our strategy has been to develop high-quality products and

Q: What future goals and ambitions does IM Natural

let consumers spread the word. Granted, transnational

expect to fulfill in the short term?

companies with long histories lead the way. But IM Natural’s

A: By analyzing available market data, we can foresee future

strategy has divided the Mexican market into different

market trends. We know that Mexico’s beauty industry

segments mostly based on their consumption capabilities.

employs 250,000 professionals. By 2019, the segment will

The brand can be found in multiple supermarket chains,

grow by 11 percent with an overall market value of MX$154

from Walmart to Farmacias Benavides, and everything in

billion (US$8.3 billion). Multiple research efforts are being

between. Finally, we have a presence in natural cosmetic

channeled into finding new ingredients and solutions. The

shops, as we did from the beginning.

quality and effectiveness of our products will grow.


| VIEW FROM THE TOP

HAIR RESTORATION: LOOK GOOD, FEEL GOOD ARIEL DÍAZ Co-founder of Kaloni Holding Group

224

Q: Kaloni’s international recognition is the result of

Q: How big is the market for your services? How do

its hair transplant technique. What is the registered

Kaloni’s services improve the quality of life of its patients?

Técnica Kaloni and why is it the most advanced in the

A: The size of the market is what attracted us toward

marketplace?

the hair business. It is the number one aesthetic concern

A: Our technique is the result of years of experience and

for men and one of the main concerns for women. This

innovation. From the very beginning we set ourselves the

problem is a source of depression, stress and even shame.

goal of creating the most pleasant and technologically

That is why we are really pleased to hear how we have

advanced technique for the benefit of our patients. It is

changed the lives of our patients. They come to us with

constantly evolving and we have become faster, more

stories about how they feel more secure or how they are

efficient and more successful than the competition. We

doing better with their partner or their job. Because it is

have even incorporated techniques from other medical

such a delicate matter the market has always existed and

areas such as platelet rich plasma, which we were one of the

according to some reports at least 40 percent of men

first to introduce to the hair restoration industry. We like to

suffer from some kind of alopecia. The hair restoration

focus on our surroundings, on what is outside the company,

services we offer are not only for balding men. We also

what other people are doing and what technology is being

help fill beards and eyebrows, and we can even cover scars

developed. We have to remember technology is advancing

that left an area devoid of hair, for example a cleft lip.

at an exceptional pace and we do not want to become the “old guys”. We want people to come to us for the latest and

Q: Lifelong follow-up is marketed by Kaloni. How does

best services in the world. The differences of our product

the company ensure this added service and what are the

are vast and they range from first contact with the patient to

incurred costs?

when they return for a check-up. The recovery time is one of

A: Lifelong follow-up is one of our biggest advantages.

the greatest accomplishments in hair restoration. In the past

The patient is usually under supervision for 14 months but

there was a technique called the strip method or FUT that

they can return anytime. We like to keep our doors open

consisted in removing a piece of scalp in order to collect

for them because Kaloni is not only a business but also

the follicles from there. This evolved into the FUE technique,

a medical center that takes care of everyone involved. It

where the follicles are collected one by one. This is much

is free of charge because we like to keep it simple and

more comfortable for the patient as the wounds are minimal

motivate people to come to us for help.

and they heal rather quickly versus the strip method, a surgical procedure that involves more recovery time.

Q: How are Kaloni’s new technology implementations – such as the ARTAS robot – improving patient outcomes

“The size of the market is

and the overall customer experience? A: Kaloni’s fixation with improvement has led us to some

what attracted us toward the

fruitful alliances. The ARTAS robot is the latest. Technology

hair business. It is the number

When we first started we only knew how to do procedures.

one aesthetic concern for men

products and we have multiplied that knowledge. We like

and one of the main concerns for women” Ariel Díaz, Co-founder of Kaloni Holding Group

has always helped medicine so we do not shy away from it. Now we have machines, cutting edge tools, bio-intelligent to make the patient comfortable with the range of options we can offer. We have something for everyone, and we like to keep expanding this. If a patient comes to us with mild alopecia there is no need for the robot and we can give him topical treatment instead.


| VIEW FROM THE TOP

AESTHETIC MARKET SPROUTS STEADY GROWTH IN MEXICO VÍCTOR ANAYA CEO of Merz Pharma

Q: How does Merz Pharma replicate its German success in

sheer population size of Mexico and Brazil, will ensure it

Mexico and the region?

remains significant. When talking about the new line of

A: Merz Mexico has been one of Merz’s most successful

energy products Merz has the most advanced technology

subsidiaries worldwide. We have been working in the

for performing non-invasive lifting, which is also growing.

country for almost 14 years. We began with a focus on

More and more small spas and clinics offer this. In Mexico

neuroscience, although recently as part of our global

plastic surgeons consider themselves owners of the

strategic direction change we have moved toward

aesthetics business and in reality they are the experts.

aesthetics and the neurotoxin business. We have also reorganized locally because our former CNS line

Q: Aside from your formidable resource allocation for

has already lost its patent in most parts of the world.

R&D, what other factors differentiate Merz?

The aesthetics business has been growing greatly in

A: Our goal is to be recognized as the most innovative

Mexico mostly among middle to upper income people.

aesthetics company, which means we invest heavily. Our

Worldwide women represent 80 percent of the market

botulinum toxin is the only one that does not contain

and men only 20 percent. In Mexico this also stands

complex proteins, which is a significant advantage. A

true. We are targeting consumers, promoting ourselves

product with proteins can cause side effects, notably

and we hold medical events for plastic surgeons and

the development of antibodies that results in an allergic

dermatologists.

reaction. As our product does not contain proteins clinical evidence shows more units can be used on patients.

Q: What made your Mexican subsidiaries so important for global operations?

That is an important factor for patients just like spasticity

A: The market, market conditions and demographics

for multiple sclerosis, cerebral palsy or an EBC. To aid

all contribute to Mexico’s importance but also Merz is a

with spasticity the muscle must be relaxed to achieve

private health company and decided against opening

movement and begin rehabilitation. Ours is the only toxin

subsidiaries widely. We have been selective and Mexico

that does not require a cold chain. There are still many

was one of our first subsidiaries outside of Europe, which

power outages in Mexico, which could compromise the

has given Merz Mexico a boost. It opened in 2002 and

product and result in a wasted investment for physicians.

was the only subsidiary in Latin America until 2015. The recent reorganization and refocus has also contributed

Q: How has the company achieved such growth, and what

to our success. Most of the revenue from Latin America

will it do to ensure the trend continues?

comes from Mexico but not exclusively. We are growing

A: We will continue to invest heavily in R&D to obtain

with double digits, which is great.

products with the highest quality. Selfina is a device that has been approved by the FDA. It corrects cellulite

Q: What would you say are the specifics that make the

and is already in the US market and we hope to bring

Mexican pharmaceutical market so fruitful or on par with

it to Mexico soon. Cellulite is a condition that is not

other foreign markets?

determined by exercise or diet and our device is the only

A: Mexico occupies the 15th–16th place in the pharma

one approved by the FDA that guarantees elimination

market. We have Merz OTC products, derma-cosmetic

of cellulite for two years. We believe it will be a huge

products,

medical

success. Fortunately, the Mexican regulatory authorities

equipment for lifting and medical devices. Merz has a

medicines

and

energy-equipped

have accelerated the process for medical equipment that

diverse product portfolio. Each product has a different

is already approved in Europe, Canada, the US or Japan.

reason for being successful. Other Latin American countries

We remain cautious though as every market is different

may be more well-known for cosmetic procedure but the

and we prefer not to rush.

225


| ANALYSIS

HIGH GROWTH POTENTIAL FOR AESTHETIC SURGERY With the advancement of modern medicine, many are

But it is not just the locals turning to surgery to fix their

now going under the knife to satisfy their aesthetic

appearance, providing an opening for the industry.

desires. Mexico is no exception, carving out fifth place

Mexico is a growing hub for medical tourism, second

for total cosmetic procedures performed globally in

behind Thailand, but it lags in performing aesthetic

2015, according to the International Survey on Aesthetic/

procedures on foreigners. The ISACP shows that in 2015

Cosmetic Procedures Performed in 2015 (ISACP) by the

on average only 17 percent of total aesthetic procedures

International Society of Aesthetic Plastic Surgery.

were performed on medical tourists, compared to 12.2 percent worldwide and 24.7 percent in Colombia, which had the highest rate of the countries surveyed. Despite

Mexico, representing 4.2 percent of the worldwide

Mexico’s success with foreign patients, it still has room to

total and split almost 50-50 between surgical and

grow in terms of attracting more foreigners to undergo

nonsurgical (461,544 and 446,369, respectively). It is no

non-elective aesthetic procedures.

surprise that in a country ranked second worldwide in terms of adult obesity, two of the most popular surgical

There is also potential to grow for companies providing

procedures were liposuction and abdominoplasty, and

nonsurgical procedures. Mexico provides only 3.0

one of the most popular nonsurgical procedures was

percent of the world’s hyaluronic acid treatments, 2.7

skin tightening. Despite the health industry’s efforts

percent of hair removal procedures and a paltry 1.7

to cut obesity rates and promote healthier lifestyles,

percent of chemical peels.

surgery is still a top option for achieving weight-loss goals.

US patients are the main foreign clients of Mexican doctors, yet the US ranks number one in all of the most

More teenagers are also undergoing surgical procedures

common nonsurgical procedures. Given its geographical

to change their looks before they reach 18 years of age.

proximity, many industry insiders see potential to grab

In 2015 in Mexico, 44.7 percent of breast augmentations

more of the market. In Mexico, much of the medical

performed on women 17 years or younger were for

tourism talk centers around dentistry and cancer

purely cosmetic reasons, a higher percentage than

treatments. There is room for aesthetic and cosmetic

Colombia, the US and Brazil.

procedures to join the conversation.

AESTHETIC AND COSMETIC PROCEDURES PERFORMED IN MEXICO IN 2015 (thousands) Surgical Procedures SURGICAL PROCEDURES

Non-Surgical Procedures NON-SURGICAL PROCEDURES

80

200

70 60

150

50 40

100

30 20

50

Source: Source:ISACP ISACP

Source: ISACP

Nonsurgical Skin Tightening

Hair Removal

Cellulite Treatment

Hyaluronic Acid

0

Botulinum Toxin

Abdominoplasty

Rhinoplasty

Eyelid Surgery

0

Breast Augmentation

10 Liposuction

226

Last year, 907,913 procedures were performed in


| VIEW FROM THE TOP

AESTHETIC SURGERY TO COMPLEMENT WEIGHT LOSS FERNANDO GARCĂ?A Director of Tijuana Bariatrics

Q: How can your surgery help with the severe Mexican

A: We are seeing an increasing number of aesthetic surgery

obesity crisis?

patients. Around 15 to 20 percent of our revenue could be

A: Obesity is a public health problem, for which Mexico

attributed to plastic surgery. This is due to patients returning

holds the top spot after the US. It is a risk for the

for a second surgery. Generally, we do not do plastic surgery

development of diseases previously known as hereditary

at the same time as bariatric surgery as they are different

but that we now know are directly related to obesity,

specialties. Dental services represent around 5 percent of

such as diabetes mellitus, hypertension, respiratory

our revenue. Most probably 98 percent of our patients are

and cardiovascular diseases. In addition, there is the

international and only 2 percent are domestic. Our business

psychological effect on patients that as doctors we do not

is geared toward foreign patients, all our publicity is aimed

always take into account. Surgery is not the complete cure

at helping people come to Mexico and making their stay

but a tool to cause lifestyle changes in patients.

easier. Most are from the US but we also get patients from Canada, New Zealand, Australia and Dubai.

Q: How popular is the follow-up plastic surgery after bariatrics surgery? How many patients choose to undergo

Q: What differentiates you other than the insurance you

this additional surgery?

offer?

A: It gives us great pleasure when a patient requires

A: As a company and as a team, we have been working

aesthetic surgery because our principal objective is for

together for many years. We believe we offer a service

people to lose weight, so when a patient turns to plastic

of higher quality and it is based on the experience and

surgery it is because they have already reached a point

attitude of the staff. We give patients the confidence and

where they have lost 30, 40, 100 kilograms and are ready

sense of comfort necessary to come to Mexico: we send a

for aesthetic surgery. About 70 percent of patients will

chauffeur to the airport, we communicate with them even

require aesthetic surgery after their bariatric procedures.

before they come, they know where they will stay, the

This is an extra service we can offer to patients, of the

timetable, we agree on flights and we respond quickly on

same excellence and quality, and we recommend it be

social media. We have a nutritionist who visits them twice,

performed after 18 months to two years after the bariatric

once in the hospital and once in the hotel. This is necessary

surgery so that their bodies have time to adapt and

because lifestyle changes need to be made after surgery.

recover after the procedure, which is major surgery.

We call them over Skype, we have an online support group where patients support each other and answer each other’s

Q: How do your dentistry services fit in with the bariatric

questions and this has been a great success. The group and

services and how does it impact your operations?

the nutritionist have been our greatest assets.

A: Our dental service is high quality and can be aesthetic or reconstructive. It is slightly less frequently required but

Q: What plans do you have for 2017?

we offer a complete service to the patient and their family

A: We would like to expand Tijuana Bariatrics, in which case

members. We offer dental services to bariatric patients

we would require more surgeons to ensure we maintain

when it does not detract from their principal objective.

quality of service and the human touch. It is a project of

We offer services such as cavity cleaning, oral hygiene

ours to grow to other cities, especially as some patients

appointments and dental prosthesis. We have a dental

wish to go to a touristic spot where they can recover. We

surgeon specialized in these areas.

have been thinking of Cancun and also Puerto Vallarta, as it is an international port. Although we aim to expand to

Q: What percentage of your revenue can be attributed to

other touristic areas, our principal objective remains the

each area such as aesthetic and dental? What growth do

quality of care. We would rather strengthen the three

you foresee in the coming years?

areas we already work in than expand to new areas.

227



11

NUTRITION & WELLNESS

In 2015 the OECD reported that over 70 percent of the Mexican population was overweight or obese, the highest level for OECD countries. Mexico ranks first worldwide in child obesity and second in adult obesity. The nutrition and wellness of the population is increasingly important as this crisis is bringing many more health problems such as hypertension and diabetes, which in turn causes glaucoma and can lead to amputation.

It is a heavy burden for public institutions as 80 percent of the IMSS budget is spent on 20 percent of the Mexican population suffering from preventable conditions. Many recommend improving nutrition and physical activity habits, creating new areas of opportunity such as corporate wellness.

Breastfeeding, a vital part of nutrition, also has been in decline. Rates of babies fed exclusively breastmilk for six months have reached lows of 14 percent in Mexico, the lowest in Latin America. NGOs such as UNICEF are working with the public sector to improve child nutrition. This chapter provides an overview of how companies are responding to the obesity challenge in Mexico.

229



| CHAPTER 11: NUTRITION & WELLNESS 232

ANALYSIS: Mexico Banks on Multipronged Approach to Awareness

234

VIEW FROM THE TOP: Isabel Crowley, UNICEF in Mexico

235

VIEW FROM THE TOP: Gabriela Allard, Mexican Diabetes Association

236

VIEW FROM THE TOP: Francisco Rodríguez, Productos Medix

237

VIEW FROM THE TOP: Javier Luna, Nestlé

238

VIEW FROM THE TOP: Fabián Bifaretti, Sports World

239

VIEW FROM THE TOP: Fernando Núñez, Grupo Body Systems

240

VIEW FROM THE TOP: Jorge Vergara, Omnilife

242

VIEW FROM THE TOP: Bensi Levy, The Green Corner

243

VIEW FROM THE TOP: Luis Suárez, SANAR

244

ANALYSIS: Obesity in Mexico

245

VIEW FROM THE TOP: Jorge Treviño, Anti-Obesity Center

231


| ANALYSIS

MEXICO BANKS ON MULTIPRONGED APPROACH TO AWARENESS Faced with a myriad of health issues, especially obesity

is very poorly treated at the population level: 24.7 percent

and related diabetes and high blood pressure, Mexico is

of diabetics were found to be at high risk of complications

taking a multipronged approach to reduce the impact on

such as strokes, heart attacks, renal failure or loss of vision

the public health system. Education to promote lifestyle

and 49.8 percent at very high risk.”

changes and prevention awareness campaigns are a priority as entities in the public and private sector look to

It is not a pretty picture but efforts are under way to

put the population on a healthier path.

spread healthier practices. Isabel Crowley, Representative for UNICEF Mexico, says one way to improve health is to

232

The OECD points out that Mexico has attracted attention

start at the beginning, by focusing on breastfeeding. “In

for its comprehensive approach to tackling diabetes and

Mexico only 14 percent of mothers exclusively breastfeed

other chronic diseases through reforms such as prohibiting

for six months, which is the lowest rate in Latin America,”

unhealthy foods in schools.

she says.

A LONG WAY TO GO

During the 2015 World Week for Breastfeeding, Minister

“Secondary prevention (i.e. the early detection and

of Health José Narro pointed out that between 2012

adequate treatment of chronic diseases) is much less

and 2015 breastfeeding had increased from 14.4 percent

well delivered,” the OECD states in its Review of Health

to 30.8 percent. Still that remains the lowest number in

Systems Mexico for 2016. It continues: “Data from

the region and puts the country barely above Indonesia,

ENSANUT (Mexico’s National Health and Nutrition Survey)

Taiwan and Cape Verde, he said in a statement.

show that, of those found to have high blood pressure (an important and treatable risk factor for strokes and

Higher breastfeeding rates could have a solid impact on

heart attacks), 47.3 percent were unaware that they had

children’s well-being because it helps reduce obesity and

the condition. Of those aware, only 73.6 percent were

other problems since maternal milk adapts to the children’s

receiving treatment and less than half of these had their

growth and acts as a first vaccination, according to

blood pressure adequately reduced. Similarly, of those

Crowley. There is also a financial impact as switching from

known to be diabetic, 14.2 percent (almost 1 million

powdered milk to breastmilk creates savings, she says.

Mexicans) had not seen a doctor for routine management

UNICEF has partnered with TV Azteca on a breastfeeding

of the condition in the past year. This means that diabetes

promotional campaign and Crowley says the government could make further improvements through extended maternity leave and baby-friendly hospitals. Improving infant health is also a target of the private sector. Nestlé, for one, is adding probiotics to its infant formula product line. Javier Luna, Nutrition, Regulatory and External Affairs Sr. Manager for LATAM at Nestlé, says that thanks to probiotics the company’s clinical trials focused on improving infant health have registered a 90 percent success rate. He says Nestlé has already added probiotics and prebiotics to 150 of its products and he

Diabetes is very poorly treated at the population level: 24.7 percent of diabetics were found to be at high risk of complications such as strokes, heart attacks, renal failure or loss of vision

projects this number will increase. Groups like the Mexican Diabetes Association are actively implementing strategies to encourage healthy eating, which can reduce obesity and diabetes. Their program “Restaurantes por la Salud” already has 22 affiliates. Gabriela Allard, President of the Association, wants people to read labels and buy products that will enhance their health. Chronic disease can be a huge burden on the healthcare system and severely impact the productivity of companies. Allard says it may take two or three generations


to get people in the right mindset but she believes Mexico

“In Mexico only 14 percent

is going in the right direction.

of mothers exclusively

EDUCATION IS KEY

breastfeed for six months,

According to the National Health and Nutrition Survey, diabetes costs the country US$3.87 billion in health services alone, which amounts to US$707 per person. Doctoralia Mexico says 15.5 million people suffer from this disease in Latin America but Mexico is home to 10.6 million. This translates to 87,000 deaths a year.

which is the lowest rate in Latin America” Isabel Crowley, UNICEF Representative Mexico

Education is the key to obesity prevention, says Jorge

help clients reduce fat, firm and tone muscle and skin and

Treviño, President of the Anti-Obesity Center. Mexican

remove expression lines.

society is too tied to its eating habits and obesity can lead to diabetes, high-blood pressure, cardiovascular

Food supplement firm Omnilife, in the middle of a global

problems, fatty livers, varicose veins and many other

expansion push, believes results can be achieved faster by

health issues, he says. Treviño believes that insurance

aiding diets with products such as theirs. “There are habits

companies authorizing obesity surgeries could help solve

that are part of the Mexican culture, such as traditional foods,

the problem.

which tend to have a high caloric and fat content with a low nutritional contribution that could be harmful to people.

Getting more people to the gym would also help. Sports

People are more receptive to us when we show them results

World, a growing fitness club chain, is seeing impressive

that habit changes can provide when they supplement their

churn rates of less than 2 percent as of March this year,

diet,” says Jorge Vergara, the company’s CEO.

says Fabián Bifaretti, the company’s CEO. This follows the company’s decision to invest in its personnel and train them

Omnilife also has a program, called Reto 90, to address the

in hospitality. “We encourage a community feel so that our

need to change people’s eating habits with the target of

clients integrate to a social group that will encourage them

reducing weight. “It is a challenge in 90 days, which aims

to stay,” he says. The company hopes to reach 70 clubs

to ingrain the habits change. The winner gets a monetary

within the next four years, 20 more than they have now.

prize. It is a whole package and includes dietary practices and recommended exercises. It is also used to help teach

According to the 2014 International Health, Raquet and

people better habits so that they can continue the positive

Sportsclub Association (IHRSA) Global Report, annual

changes,” Vergara says.

revenues for the fitness sector in Mexico amounted to US$1.5 billion with nearly 8,000 clubs open around the

It may be true that the fastest route to health is through the

country. On the downside, this only represents 2.2 percent

stomach, with healthy eating. Bensi Levy, Director General

of the population.

of the Green Corner, says that newly attained social consciousness has led to exponential market growth in

Companies also have a vested interest in the health of their

the organic food sector, despite the rough financial patch

workers. Grupo Body Systems has successfully entered

the country is experiencing. Raw, vegan and gluten-free

the corporate wellness sector, helping their clients create

products are new, and encouraging, trends in the sector.

savings by lowering work absenteeism, attendance and personnel rotation. By minimizing sedentarism in workers

“It is important to keep in mind that a balanced lifestyle

it has also helped reduce insurance costs, says Fernando

is vital for a healthy body,” says Levy. “Therefore, organic

Núñez, the company’s Director General. Grupo Body

foods must be supported by consistent exercise and stable

Systems' Wellness 360 program provides nutritional,

sleep cycles. Unfortunately, the market is shifting to an

physical and mental support for employees. The group’s

industrialized organic pattern, which takes away from the

success is leading it to 40 percent growth this year, he says.

basic principle of creating a rich biodiverse environment.”

Medix’s consumer division opened two brands -- 180°

Integrative medicine is another avenue to pursue. Luis

and SlimCenter -- in Mexico, focused on weight loss.

Suárez, CEO of SANAR, says acupuncture and ozone

180°, which opened in February 2016 and became

therapy are among the services in demand in Mexico.

profitable within a month, is equipped with some of the

“Every mother and grandmother knows how to use herbs

same medical devices found in hospitals, says Francisco

and plants,” says Suárez. “This is a more formalized version

Rodríguez, Consumer Division Director. These devices

of that and it has been very well received.”

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| VIEW FROM THE TOP

BREAKING BREASTFEEDING MYTHS IN MEXICO ISABEL CROWLEY Representative of UNICEF in Mexico

234

Q: What has UNICEF achieved through its breastfeeding

is with the baby after birth and that breastfeeding is

program in Mexico?

initiated immediately. What we recommend doesn’t cost

A: We have done many things. In Mexico only 14 percent

very much. The State of Mexico is making great savings

of mothers exclusively breastfeed for six months, which is

by switching from powdered milk to encouraging mothers

the lowest rate in Latin America. We could see the negative

to breastfeed. We also have to ensure that there is a code

impact on the health of children in terms of obesity and

for breastmilk substitute for the industry to adhere to and

other problems and so this would be a way to reduce

comply with, but it is a big business and they have not

government cost in the medium and long term and spread

been adhering to this. This is something the government

the benefits for breastfeeding for mothers and children. For

must enforce. There are a lot of interests involved but

breastfeeding mothers there is less incidence of cervical

the constitution tells us that the best interest of the child

and breast cancer, they lose weight more rapidly and are

should override any other concerns. Last year there was a

less prone to being depressed. For children it is extremely

gathering of the three main groups that deal with children’s

important because breastmilk adapts to the age of the child

health:

and the first milk that the mother gives is like a vaccination,

Federation, the Mexican Pediatrics Association and the

it has all a newborn child needs. They will be healthier and

Mexican Confederation of Pediatrics. It was the first

they will not get as sick. This is why we are working hard

time they worked together and they signed a historical

to change the status quo so children are not negatively

agreement to increase breastfeeding in the country.

the

Mexican

Obstetrician

and

Gynecologist

impacted. Over the last 20 years women have been increasingly incorporating themselves into the workforce.

It is very important to create awareness. At first we were

Over 50 percent more are working now than in the past

not getting any traction so we created a viral video about

but laws have not changed to help them breastfeed. We

a woman breastfeeding in a park arrested for showing her

ran a campaign with TV Azteca to promote breastfeeding.

breast. We wanted the public to start talking about it. An

We are trying to educate and break the myths about

important task of UNICEF is to create awareness and then

breastfeeding.

the environment for public policy to change. We feel that in the last 2 1/2 years we have done a lot but it will only be

Policy improvements have been made, women no longer

successful when we start seeing the results for children.

need to take six weeks pregnancy leave before having their baby. This does not have an additional cost to the

Q: What do you attribute to the drop of breastfeeding

employer but is beneficial to the mother. Other simple

rates in indigenous communities?

solutions that make huge differences would be to give

A: Breastmilk is the best. It comes with the right nutrients,

mothers a place to breastfeed and store their milk. We are

at the best temperature and it’s free. It was a major

also working on increasing maternity leave. We will have

human rights problem when we decided that powdered

an active campaign during International Breastfeeding

milk is better than breastmilk, which is precisely why the

Week to help the government and the general population

government should be implementing health codes for

realize the importance of breastfeeding and increase the

tinned milk and promoting breastfeeding. Of course tinned

percentage of mothers exclusively breastfeeding in the

milk is a good option for mothers unable to breastfeed but

first six months.

it should be the last resort instead of the first. It is difficult to compete against the industry, especially when they invest

Baby-friendly hospitals are another strategy of the

about the same amount to advertise their tinned milk in a

government, discontinued many years ago but starting

day that we invest to promote breastfeeding in the whole

again. The hospitals must comply with certain regulations

year. Campaigns by the government and support from

to get the certification. These include ensuring the mother

hospitals will help educate and raise breastfeeding rates.


| VIEW FROM THE TOP

HEALTH IS EVERYONE'S RESPONSIBILITY GABRIELA ALLARD President of Mexican Diabetes Association

Q: What has “Restaurantes por la Salud” and “Feel Healthy”

and we are pushing for resource allocation from these taxes

achieved in the last year?

focused on improving access to water.

A: This program has been very successful with 22 restaurants participating. We want to offer healthy food options for

Q: Some experts think healthcare is not a priority in the

people and we want this to become a prevalent and massive

government’s agenda. What are your thoughts on this?

initiative such as smoke-free spaces. When a restaurant

A: I believe it is the exact opposite and that many public

decides to participate we provide the necessary guidance to

offices are working to improve the population’s health.

create healthy options on the menu. There are many people

But it is not that easy and we should not leave the entire

who believe that healthy food is not delicious and we want

responsibility to the government. We should team up with the

to let them know this is not true. We are not against any

public sector and they should develop new communication

type of food but we want people to learn healthy eating

channels through which they can convey recent advances

and have a balanced diet. There are no good or bad foods

in healthcare promotion. There are a lot of initiatives of

and everything depends on people’s lifestyle and habits.

which people are not aware. Changes cannot be made

Chefs are also invited to join these restaurants and learn to

overnight It can take two or three generations to see actual

cook healthy food. “Feel Healthy” has been successful with

changes in the population. Chronic diseases can become an

effective patient adherence to the exercise programs that

unbearable burden for society and the healthcare system.

are tailored according to their condition. We are also working

The productivity of companies is also impacted by chronic

with Tonalli support association in which we take children to

diseases so we need to make people realize the importance

nutritional camps and teach them how to inject themselves

of prevention. In the past, diabetes type 2 was a disease seen

with insulin and count their carbohydrate intake.

in people over 45 years old and today there are children suffering from it, and Mexico is one of the countries with the

Q: What has been the reaction to the Mexican Diabetes

highest levels of children obesity in the world. I think people

Association Guarantee Stamp from the industry?

have the power to decide what to eat but much more effort

A: Responsible consumption and production has also

is needed to get the right message across.

reached the industry. There are some pharmacies interested in selling products that are acceptable for diabetics and our

Q: What is your final message to our readers?

stamp guarantees the use of healthy ingredients. Additives,

A: We all should be involved in promoting healthcare

such as sweeteners, are under continuous scrutiny and there

and raising awareness. We should all be responsible for

is a lot of updated information about their safety and health

preventing obesity and diabetes on an individual basis,

impacts. We are interested in making people read labels

and we cannot leave the full duty to the government and

and buy acceptable products. A validated product is not

schools. Every person has to be completely in charge of

necessarily a carbohydrate free product but a balanced one.

their own health.

Q: To what extent do you think taxation on sugary beverages

“People have the power to

contributes to improving the diabetes crisis in the country? A: I think it has been an excellent initiative. Contrapeso is a network of associations coordinated by the Director of Fundación Mídete. In Mexico there are millions of people hydrating with soft drinks. We are not against the beverage industry but we are pushing for these people to have access

decide what to eat but much more effort is needed to get the right message across”

to water in their communities and schools. This measure

Gabriela Allard, President of Mexican Diabetes

has raised awareness on the importance of drinking water,

Association

235


| VIEW FROM THE TOP

WEIGHT-LOSS CENTERS SURGE IN MEXICO FRANCISCO RODRÍGUEZ Consumer Division Director of Productos Medix

Q: How has the Medix Consumer Division evolved

this. Some 180° centers have integrated fitness circuits

throughout the years?

that help clients complement their fat reduction efforts.

A: Medix’s Consumer Division was created one year ago

236

and is divided into three brands, two of which are in Mexico.

Q: What are the main services that 180° provides?

180° and SlimCenter are brands specifically targeting the

A: We have a wide range of services. These include body

Mexican market and our Become Yourself Centers brand

fat reduction, firming and toning muscle and skin and

can be found in the US. Even though 180° is Medix’s luxury

expression line removals, as well as nutritionist services

brand, our SlimCenters are almost up to par. The latter was

that follow up and compliment our services. Our SlimUp

recently acquired by Medix and had no investments in any

device tones all types of muscles while our Thermage

of its seven centers for more than 30 years. Its previous

treatment removes facial marks by stimulating lower

owners developed such an effective treatment method

dermis layers where collagen is found. Its effects help the

that a COFEPRIS certification was secured, with which we

body create its own natural collagen after a three-month

can now advertise and guarantee a seven-kg weight loss

period, achieving a real rejuvenation process. All of our

after only 20 sessions.

services have a scientific basis with no collateral effects. For us to make our clients feel better we must help them

A little over a year ago Medix acquired 20 centers in the US

reach their optimal weight. Therefore, our nutritionist

that were owned and branded as Medifast Weight Control

services are complementary.

Centers. Back in the day, Medifast sold 70 percent of its volumes through direct mechanisms called Take Shape for

180° is an integral solution for clients. We are there to

Life, 20 percent through e-commerce and the remaining

help them reach a certain weight and to ensure the best

10 percent at the control centers. Thereafter, we decided

results before undergoing our treatments. Our nutrition

to rename the brand Become Yourself while keeping our

plans with the use of Medifast products account for 40

previous business plan intact.

percent of our sales, proving their extraordinary success and effectiveness.

Medifast eatables remains as the nutritional foundation and we subsequently implemented the machinery found

Q: What has allowed Medix’s Consumer Division to

in our Mexican centers. After implementing our added

successfully position itself in such a congested market

services sales grew by 47 percent, which shows the

through its 180° concept?

effectiveness of our integral business model.

A: Our centers are equipped with the latest technology. A nonsurgical procedure, the CoolSculpting device acts

Q: What was the idea behind 180° centers?

similarly to liposuctions and eliminates the accumulation

A: We needed to create integral centers covering most

of adipocytes in the body. Even though it has a clinical

of our client’s concerns. We are equipped with medical

use, the technology is also used by plastic surgeons,

devices also found in hospitals and specialized clinics.

dermatologists and wellness spas. Given the benefits and

We have a DEXA bone densitometry scanner that also

success of our treatments we create clients for life. We

produces a muscle and body fat report, which we call

cover a wide range of needs most of which can be serviced

BodyScan. This type of equipment needs a specialized

at any given occasion. We understand the concept may

technician to operate and we have hired a professional

be new to Mexican consumers but our indicators show

in the field. In addition, our centers have physicians that

that it's gaining traction. Our first 180° was inaugurated

perform an overview of our clients’ health before providing

in February 2016, immediately followed by two others in

any type of treatment. We must provide scientific support

the same month. All our centers, regardless of their brand,

for everything we do and our physicians help us achieve

became profitable after the first month.


| VIEW FROM THE TOP

NESTLÉ FOCUSES ON PUBLIC HEALTH ISSUES JAVIER LUNA Nutrition, Regulatory, and External Affairs Sr. Manager for LATAM at Nestlé

Q: What role does innovation play in Nestlé’s corporate

be denied. Consumers must first understand the health

strategy?

benefits of these additives. Thereafter, the market will

A: Mexico’s public health issues are one of Nestlé’s biggest

reshape itself. As of today, Nestlé has added probiotics

concerns. Our new corporate agenda focuses on reducing

and prebiotics to 150 of its products and we see the trend

the levels of sodium and sugar in several products of our

rising.

portfolio. We are finding better and healthier ingredients that will increase our client’s options. Consumers must

Q: To what extent has COFEPRIS’ seal of quality helped

make informed decisions and we are helping them in

Nestlé and its products?

the process. Nestlé continuously innovates and assesses

A: We are quite pleased and extremely optimistic about this.

product releases. This is the spirit of the company.

Countries like Japan have implemented similar measures

With a 150-year history, Nestlé has always emphasized

which have had a tremendous impact on companies that

and stressed innovation practices. There are instances

were granted this recognition. Even though only some

where renovations are the only logical step forward,

of our products have received the nutritional seal from

but fulfilling emerging market needs with new product

COFEPRIS, we are working on spreading this across our

releases is crucial as well. To date, Nestlé is innovating in

portfolio. Before Nestlé’s accreditation, LICONSA was the

the food supplement and infant formula segments. We

only entity with such recognition and it helped put the

are producing better products with advanced health and

company on higher ground.

nutrition traits for consumers. Q:

What

collaborations

with

organizations

and

Q: How relevant is the infant nutrition portfolio for the

associations have you created to promote a healthy

company and what gaps is Nestlé aiming to close in this

lifestyle and a balanced diet?

segment?

A: Nestlé has a worldwide social responsibility initiative,

A: Infant nutrition is an important segment to Nestlé. The

collaborating with multiple stake holders around the world.

whole industry, alongside government and academia, is

We have established relationships with Mexican medical

working on ways to minimize breastfeeding complications.

and nutrition societies on a local, state and federal level.

We were the first company in Mexico to innovate in this

In addition, Nestlé has implemented internal programs

regard by adding probiotics to our infant formula product

to promote healthier lifestyle habits in Mexico, Nestlé’s

line. As a result, Nestlé leads the market in probiotic

global initiative led us to their development, but they must

administration. Our clinical trials have had a 90-percent

be regionalized. We are allocating economic resources

success rate positioning us at the top of the herd. In

and human capital to this endeavor, which reiterates our

addition, Nestlé’s OPTIPRO® innovation optimizes protein

commitment to the programs. Mexico has growing issues

intake by creating an equivalence to breast milk, which has

with obesity, malnourishing and breast feeding, which

been implemented in our GOOD START and NAN brands.

calls for an action plan to promptly come into force. We are always looking to partner with the government and

Q: How much is the probiotic market growing in Mexico?

academia, share our efforts, grow our scope and reach our

A: Components that add value to products are increasingly

goals at a faster pace.

demanded by consumers. For instance, 10 years ago nucleotides were administered to different types of

Nestlé wants to become a nutrition leader by thoroughly

products. Even though they were poorly received at first

understanding people's lifestyle and dietary intake. In

due to price increments they later became mandatory

addition, we must secure our position as industry leaders

worldwide. I foresee that probiotic implementation will

in nutrition and health research with the help of internal

behave similarly as their positive effect on children cannot

programs and external collaborations.

237


| VIEW FROM THE TOP

INVESTMENT LIFTS RETENTION RATES AT GYMS FABIÁN BIFARETTI CEO of Sports World

238

Q: How have Sports World’s specific efforts to increase

until we have reached our full potential. Fifty clubs are

customer retention been reflected in the company’s

not enough, thus growth will improve our position in

market position?

terms of stocks. The sector itself could grow considerably

A: The company has reached a record high, reversing last

and while industry players continue to make moves that

year’s low retention record. In March 2016, we registered the

intrigue investors we will see a general increase in market

lowest churn rate since we started operating. Today, less than

penetration.

2 percent of members drop out from the club. The market’s average is between 2.5 percent and 4 percent depending on

As the dollar strengthened the cost of our equipment rose.

the type of business and country but below 2 percent is very

Nonetheless, we have not lowered investment. In fact,

rare. Thus, we are proud of our work and attribute much

instead of waiting eight years to replace machines we now

of the success to our strategy of continuously improving

make routine changes every five to six. Cardiovascular

customer service. The whole company has undergone

machines in particular must be changed frequently as

training sessions in hospitality, specifically to be able to

they receive the heaviest use. Therefore, rather than

personalize service to different kinds of clients. Excellent

cutting investment in these imported products we have

service philosophy must be maintained and passed on to

found savings in other areas such as reducing the cost of

new people that enter the company.

infrastructure of new clubs. By negotiating better deals with construction companies we have been able to keep

Analysis of classes we offer led us to identify the variables

the same level of investment in maintenance to benefit our

that encourage or limit attendance. Within peak hours, we

members.

identified that popularity of most classes depended on the trainer leading the class. In response, we launched a

Q: In what areas is Sports World geographically targeting

program called Start Trainers so that our 20 best trainers

growth and club inaugurations with the projected

could guide 150 staff members to give even better classes.

investment this year?

We encourage a community feel so that our clients

A: Our growth has been organic, tending to open five or six

integrate to a social group that will encourage them to stay

new clubs per year. Per year, the average cost of new clubs

in a specific gym. Those that attend two or three classes

is MX$200 million (US$11 million) plus a further MX$30

per week are less likely to cancel their membership.

million (US$1.6 million) approximately for maintenance of existing gyms. However, we aim to optimize the building

We started 2015 poorly, but in 2Q15 we balanced it out to

costs by square meter following some positive offers from

the point that we saw positive results at the end of the year.

construction companies. While we have investigated and

The recovery that we saw in the final quarter was partly due

are negotiating inorganic growth opportunities few have

to market trends but also due to a focus on service. Aiming

matched our expectations and tend to be more expensive

to optimize our overheads, we delayed some unnecessary

than constructing from scratch.

renovations. However, this influenced our retention levels. We have switched the focus to correct this and we are now

Every year we concentrate less on the capital city. Of the 50

benefiting from increased efforts, reaching almost 70,000

clubs operating, 35 are in the city and 15 in the rest of the

members.

country. We are now focusing on balancing the quantity of clubs in and outside the capital 50/50. Three new

Q: How has corporate pushed to raise their value and

locations will be opened in Guadalajara this year, another

stabilize the brand?

in Merida and in the future we will continue to increase the

A: The company’s marketability is low although our results

concentration in other states. In total, we hope to reach 70

have been excellent. We do not expect to see a change

clubs in Mexico within the next four years.


| VIEW FROM THE TOP

EMPLOYEE WELLNESS DRIVES PROFITABILITY AND PRODUCTION FERNANDO NÚÑEZ Director General of Grupo Body Systems

Q: With over 12 years of experience in the wellness sector,

them were companies such as Seguros Monterrey, New

what were the market opportunities that led to the

York Life, KPMG, CMR, Pepsi Co., all of which have an

creation of Body Systems?

assigned budget for this type of corporate program.

A: Grupo Body Systems includes four companies. We

We seized the opportunities the market had to offer.

started by targeting clubs and gyms and offering high

Every company has a budget allocation for training

quality group fitness classes. Back then, this segment

courses, which is the approach we are taking through

offered huge opportunities as few companies offered

stress management, meditation, nutrition or mindfulness

specialized classes like ours. Five years later, our CEO

courses. There is a newfound interest for services like

envisioned the opportunity of spreading into corporate

ours helping us significantly expand our operations. Our

wellness. As such, he was summoned to be a founding

prospect client pipeline is quite robust.

member in the Wellness Council board, which allowed him to better assess the available market opportunities.

Grupo Body Systems is part of the American Chamber of Commerce, which has further strengthened our

By focusing on corporate wellness we realized that

capabilities. Growing at the same pace as the market

companies were saving large amounts of money by

is an important challenge. The quality of our corporate

minimizing work absenteeism, attendance and personnel

service far exceeds our competition, making us segment

rotation. Therefore, insurance costs dropped significantly

leaders. Our operational program allows us to train and

as primes were lower than the average. Our Group Fitness

retain instructors much more efficiently while offering

model offered different classes to companies with the

better remuneration for their services. Through systemic

right infrastructure, such as fitness centers or gymnasiums.

surveys we have realized that the quality of our courses

So far, we provide an estimated 800 worth of weekly

is far greater than our competition. Grupo Body Systems

instruction hours. Back in 2014, the company widened

is working on attaining international certifications, further

its services by devising an integral human development

advancing its institutional accreditation.

model that covered each part of an employee's life. For instance, we have instructors that activate employees at

Q: What benefits can a company receive by hiring your

different times during the day, which has paid off through

Integral Human Development Program?

productivity increments.

Q: We diagnose a company’s operations further offering a service that fits their specific requirements. The Wellness

Generating our own data is probably our biggest area of

360 program offers an integral solution to an institution’s

opportunity. Data belongs to our clients and employees.

problems covering nutritional, physical and mental

However, we are finding ways to use this information and

aspects of its human labor. Being sedentary is one of

consequently improve our programs. The company has

the biggest problems the market is facing. This type of

realized that results are not only trackable in the long

behavior can produce hypertension, diabetes and other

term but in the short term as well. Institutions implement

conditions.

measurements based on the expected ROI, coupled with their inherent interest in providing employees with added

Q: What are the key objectives you want to fulfill by the

benefits and compensation.

end of the year? A: Grupo Body Systems has a growth expectation of over

Q: How do you approach companies and how do you

40 percent, which the company is on track with. With time

differentiate from other businesses?

our clients are requesting more and better paid services,

A: Our approach led us to target transnational companies

which impacts our profitability. The market opportunities

first, which is Grupo Body System’s strong suit. Among

will continue to grow.

239


| VIEW FROM THE TOP

RESULTS-ORIENTED SUPPLEMENTS TO CHANGE BAD HABITS JORGE VERGARA President and CEO of Omnilife

240

Q: What are the distribution advantages that you have at

on a cruise. The young people also organize their own

Omnilife?

trips, like one they did recently to a music festival in Brazil.

A: We work directly with our distributors who in addition

We also seek to take some advantage of the technological

to using the product have the advantage of directly

era through bonuses and incentives in which distributors

approaching the consumers, which gives us a personalized

can win a tablet or smart phone to help their business to

treatment. We offer courses related to human development,

grow faster. We have a close relationship with them and

business administration, finance and the basic business

this helps retention rates.

tools to be successful as an Omnilife distributor. We also have direct telephone lines for different questions that our

Q: What are the regulations implemented by COFEPRIS

distributors and consumers may have about our products

that affect your business?

or business. Our top-selling products in Mexico include

A: We have a good working relationship with COFEPRIS

Omniplus, Power Maker, Magnus, Optimus, Thermogen

because when we started the company there were no

coffee and tea, Chiva Cola, Aloe Beta and Dolce Vita.

other supplement companies in the market in Mexico. Since then we have had a close relationship with the

Q: What is the difference between Omnilife and similar

authorities. Omnilife has been closely involved in the

competitors?

regulation of the dietary supplements industry, a situation

A: The only thing we have in common is that we do

that has influenced countries such as Colombia, Costa

supplements. We make powders and liquids and our

Rica and others in which Omnilife is present. We continue

competitors mostly do tablets. We also focus on the

working and promoting the improvement of the regulatory

special needs of the population, in this case Mexico and

framework for our category, which allows technological

we are chasing results instead of money. We make sure

progress in the development of new products.

to cover all our customers needs before they spend all their money on goods that are not necessary for them. We

Q: How is Omnilife trying to help with Mexico’s problem

have many differences in what we teach, how we teach

of chronic diseases, like diabetes and obesity?

and of course, in our products. Another important thing is

A: Our philosophy is that rather than changing bad

we respect the culture and flavors of the country we are

habits drastically, we could orient them to nutrition by

working in.

consuming our products. There are habits that are part of the Mexican culture such as traditional foods, which tend

Q: What are the strategies for recruiting distributors from

to have a high caloric and fat content with a low nutritional

ages 18-25?

contribution, that could be harmful to people. People are

A: Our group, NFuerza, was created when we saw there

more receptive to us when we show them results that habit

were many young family members of distributors that also

changes can provide when they supplement their diet with

wanted to become independent distributors. Young people

our products, which is why we are convinced that the best

have realized that we appreciate their talent and that they

way to motivate people is by showing results rather than

can start their own business through this company. Today

just preaching to them.

we have about 300,000 young distributors in different countries, and we expect this number to double by the

When I started the company, I was fat and sick and I

end of this year.

wanted to lose those habits that were harming me. I believe that people start learning through results. Education

Q: What strategies do you use to retain this talent?

is very important but it is not enough. For example, the

A: First, we use their language. We make a yearly trip

educational campaigns against smoking have not really

where we take about 4,000-5,000 of the biggest sellers

accomplished much. The people also need to witness the


241

results for themselves before they make any long-term,

manufacture in Mexico, Colombia and Ecuador. We plan to

real changes in their habits and lifestyle and this spreads

manufacture products in Russia and India, especially since

to other people.

the flavors and products will be tailored for those cultures.

Q: Omnilife is already present in many Latin American

Q: What is the program Reto 90?

countries. To which other countries would you like to

A: Reto 90 is a program to help people change their eating

expand?

habits, having consequently some weight loss. It is a 90-

A: We will expand to Russia by September of this year, India

day challenge that aims to ingrain the habits change.

and Nigeria by next year and Australia by the beginning of

The winner gets a monetary prize. It is a whole package,

2018. These are countries that I take a personal liking to

including dietary practices and recommended exercises. It

and I feel comfortable approaching them and attending

is also used to help teach people better habits so they can

to each culture.

continue the positive changes.

In five years, we expect to be in at least 10-12 more

Q: What are the new products you are planning to launch?

countries, especially in Asia and other countries that we

A: I cannot tell you! twenty-five years ago, we revolutionized

feel a connection to. it is also important to keep in mind

the industry with liquid vitamins and we plan to do

that we will manufacture the products near the country

something similar in a couple of months. We spend a lot

they are being distributed in, since it is more expensive to

of research and development to produce original products

transport than manufacture in some cases. Right now, we

that cover the specific needs of that country.


| VIEW FROM THE TOP

SOCIAL CONSCIOUSNESS LEADS TO ORGANIC FOOD BOOM BENSI LEVY Director General of The Green Corner

242

Q: How has society responded to your products in a time

employment and positively impacting the region’s crime

where food has become a focal point in people’s lives?

rate, which we take great pride in. Our workforce has grown

A: At first we thought convincing people would be the

throughout the years as our sustainable development

hardest task, which was certainly not the case. Even though

model works year-round contrary to the season-based

the turnout was much lower, there was always a demand for

approach of industrialized enterprises. The latest organic

organic goods. We saw people from Cuernavaca, Queretaro,

industrialization trend has blueprinted their working

San Miguel de Allende and Aguascalientes, to name a few,

mechanisms and although products are healthier than

coming to our store looking for better alternatives. It is also

the average they do not cover the whole environmental

true that The Green Corner went through an education

spectrum. There is little waste from The Green Corner’s

process, taking part in organic tianguis, back when they

end as organic matter in the process of turning bad is used

were not popular. In 2005, the company participated in

for either juice production or to feed livestock. This way

an enormous organic fair launched at Mexico City's Zócalo

we close natural life cycles and reduce costs. We have a

in celebration of World Environment Day. At this event,

rain capture pond used in our irrigation processes differing

producers and distributers got to know each other while

from wells that need foreign sources of energy to extract

also assessing the number of consumers in the city. The

water. Once implemented we decided to introduce bream

Green Corner’s initiative also led the company to schools

that feed off mosquitoes. Given their quick reproduction we

and hospitals, educating the general public of the benefits

now harvest fish meat as well. Our pond water is filled with

that organic products had. In return, physicians started

nutrients derived from fish waste so it is used in our fields

sending their patients to us for viable preventive solutions.

to enrichen the soil. We are creating an intricate ecosystem that the industrial model previously wiped out.

Q: Where does this market segment stand and what are the newest trends that The Green Corner has perceived?

Q: How does the Green Corner pick the producers it does

A: Newly attained social consciousness has led to

business with and what are the company’s distribution

exponential market growth. Although there has been a

channels?

demand upsurge over the last six years the segment is going

A: There were no pre-established norms when we first started

through difficult times due to Mexico’s economic crisis. As

our operations. We took it upon ourselves to make sure

such, growth has not continued as strong as before. But

that our partners followed our philosophy. As the industry

new niches have emerged, such as raw, vegan and gluten

grew bigger the NOM-037 came into force. To date, around

free products, to name a few. Having a wide variety of

95 percent of producers are certified. However, this is not

nonprocessed goods is the segment’s goal. It is important

enough to ensure good practices. Organic industrialized

to keep in mind that a balanced lifestyle is vital for a healthy

companies have enough distribution channels with large

body. Therefore, organic foods must be supported by

supply chains. Small producers need stores like The Green

consistent exercise and stable sleep cycles. Unfortunately,

Corner to survive. We also help small producers obtain

the market is shifting to an industrialized organic pattern,

certifications as we have close relationships with certifying

which takes away from the basic principle of creating a rich

agencies. So far 37 farmers have been certified with the

biodiverse environment.

help of The Green Corner.

Q: What can you tell us about The Green Corner’s

Q: Where will we see The Green Corner in 2016?

production mechanisms?

A: We expect to open more stores in Mexico City,

Our production practices keep the environment in mind

commercialize larger product volumes, and consequently

at all times including the impact we are generating and

help small farmers. In parallel, we will lower the volume of

the influence we have on our community. We are creating

imported products in our shelves.


| VIEW FROM THE TOP

INTEGRATIVE MEDICINE ON THE RIVIERA MAYA LUIS SUÁREZ CEO of SANAR

Q: How did you decide to focus on integrative medicine

often already searched for it online and reviewed all the

and why did you decide to do so here in particular?

conventional and alternative therapy options open to

A: When I was younger I had asthma and I often saw

them. This drive for knowledge and global awakening

doctors and ended up in hospital. Then one time an

to the effects of chemicals on the natural environment

acupuncturist treated me and I never had asthma again.

has contributed to people being more open to these

It prompted me to study general medicine in Mexico and

techniques. Mexico has always had traditional medicine,

to specialize in Acupuncture and Phytotherapy. I then

and every mother and grandmother knows how to use

studied integrative medicine in the US. This used to be

herbs and plants. This is a more formalized version of

called alternative medicine but that is a misnomer as it

that and it has been very well received. Sadly there are

gives the impression the patient has to make a choice

many snake-oil vendors who give this type of healing a

between the two. This field of medicine has grown the

bad reputation. I would love for integrative medicine to

most in oncology. An oncology patient will receive

be officially sanctioned here in Mexico but the discussion

radiation therapy, surgery or chemotherapy. Other

is still difficult as most do not realize that it is not a fight.

techniques are now administered hand in hand with those

It should be a collaborative effort between integrative and

conventional therapies. Ozone therapy is administered

conventional medicine.

while receiving chemotherapy as it heightens the body’s tolerance to chemotherapy, which improves results. We

Q: How can the integrative movement in Mexico be

also aim to improve the patient’s mindset by giving him

strengthened?

mindfulness and yoga exercises because a depressed

A: It can be strengthened through the diffusion of

patient has less chance of recovery. These techniques

information. We need to show that we want to work

contribute to improving the patient’s quality of life and

together for it to be more accepted by authorities such

the final prognosis.

as COFEPRIS. We then need to organize ourselves in a conference and hold an event to gather us all together but

Q: Which are the treatments most in demand and what

sadly there are no resources for integrative medicine. From

can they help with?

a normative point of view, the formalization of integrative

A: Acupuncture and ozone therapy are the most

medicine would allow institutions like COFEPRIS to extend

demanded. Acupuncture can help with many problems

its umbrella over practices that are not yet regulated.

like stress, panic attacks and pain, and it has applications

We are creating an event ourselves that will take place

in gynecology and pregnancy as there is no need for

on October 1st and to our knowledge it will be the first

medicines that may hurt the baby. We recommend

regional integrative medicine event. Unfortunately, it is

acupuncture for almost every patient we see as no matter

true the field lacks professionalism. I am lucky enough to

what ails them acupuncture can help as part of their

go to Europe and North America to attend courses and

treatment. Ozone therapy can also be applied for chronic

conferences but not everyone has that opportunity, which

pain and viral infections such as those that are caused by

results in undertrained people wrongly administering these

chikungunya and dengue fever.

treatments. The press only reports the cases that went wrong and this tarnishes our reputation.

Q: To what degree have you seen the stigma of alternative medicine reduced in other parts of the region?

Q: Where will we see you in the future?

A: With all the information available nowadays on the

A: We have begun to look into medical tourism as many

Internet patients are already in possession of an impressive

patients come from abroad looking for this type of

amount of knowledge when they come for a consultation.

therapy. In general, regenerative medicine is expensive

No matter what the patient suffers from he or she has

and inaccessible in other countries.

243


| ANALYSIS

OBESITY IN MEXICO Mexico’s worrying obesity epidemic has become a priority

4th highest proportion of overweight adults in the Americas,

for both local authorities and international organizations

as per BMI (Body Mass Index) measurements, behind the

such as the World Health Organization (WHO), which

Bahamas, the US and Canada. The country had the worst

stated in a 2014 report that the country suffered from the

index for Latin America, followed by Chile and Venezuela.

XXX (in PCT) AND OBESE ADULTS IN THE AMERICAS IN 2014 (percent) OVERWEIGHT 80 70 60 50 40 30 20 10 Haiti

Paraguay

Honduras

Nicaragua

Bolivia

Guatemala

Belize

Guyana

Brazil

Ecuador

St. Vincent & Gr

Colombia

Dominican Rep

St. Lucia

El Salvador

Peru

Grenada

Dominica

Cuba

Suriname

Jamaica

St. Kitts & Nevis

Uruguay

Costa Rica

Trinidad & Tobago

Panama

Argentina

Venezuela

Source: WHO Source: WHO

Antigua & Barbuda

Chile

Barbados

US

Mexico

Canada

Bahamas

0

Child overweight rates show that almost one of every

equivalent to MX$1 (US$ 0.05) per liter and an 8 percent

three children in Mexico is overweight, compared to rates

tax on the price of every non-basic food with a caloric

of around 23 to 21 percent for Organization for Economic

density equal or greater than 275 calories per 100

Cooperation and Development (OECD).

grams. Professor Alfonso Miranda of Mexico’s Center for Economic Development Research (CIDE) says in an

The problem has become a government priority and in

article for research center CONACYT that this tax reduced

2014 President Enrique Peña Nieto implemented a new

consumption of sugary drinks by a rate of 6 to 12 percent

tax on high-caloric-density foods and sugary drinks,

in its first year.

OVERWEIGHT CHILDREN PER SELECTED OECD(in COUNTRIES (percent) OVERWEIGHTAND ANDOBESITY OBESITYIN DATA PER SELECTED COUNTRIES PCT) 30

boys girls

25 20 15 10 5

Source: OECD estimates based on national health surveys. Note: Measured height and weight in Australia, England, Korea, Mexico and USA; self-reported data in other countries.

boys Source: OECD

girls

Brazil

India

Australia

Canada

Chile

France

Norway

Poland

Portugal

Switzerland

US

Mexico

0 OECD average

244


| VIEW FROM THE TOP

EDUCATION CENTRAL TO ANTIOBESITY EFFORTS JORGE TREVIĂ‘O President of Anti-Obesity Center

Q: What actions can be taken to avoid reaching the

focusing on social media and our webpage. Working

alarming obesity levels we are experiencing in Mexico?

with brokers is also important, as they usually promote

A: The only thing we can do is to reinforce education.

our services with many more possible patients. Another

Unfortunately, our social lives revolve around eating

important source of patients comes from referrals from

rituals, we go out to eat with friends and we close business

US colleagues. As of today, most patients coming from

over dinner or drinks. If we do not teach our children the

abroad are in need of obesity-related services. Often, our

correct eating habits, it is easier for them to suffer from

patients have already undergone an obesity surgery that

obesity the rest of their lives. People need to be aware

did not go as planned, so we perform revision surgeries.

of the risks obesity involves. Prevention is crucial. There

We expect that eventually the rest of the procedures we

are many health problems associated with obesity and

offer will also be in demand. In Canada, we have seen that

people sometimes are not aware of them. A patient with

unless it is a medical emergency, people experience long

obesity is more likely to present diabetes, high-blood

waiting periods to have medical procedures done.

pressure, cardiovascular problems such as heart attacks, chest angina, strokes, fatty liver, varicose veins and many

Q: Which are the characteristics you consider when

more health complications that could develop. There

deciding who is suited to a specific procedure?

are some forms of cancer related to obesity, particularly

A: You have to be very cautious for several reasons. First,

gynecological cancers.

the patients visit with a limited amount of time, usually periods of no longer than a week. Secondly, many have

Having insurance companies authorizing obesity surgery

not been correctly assessed by doctors and may have pre-

would be very helpful and in the long run this course

existing conditions that could make their surgeries riskier.

of treatment would be more economical than treating

To avoid having risky situations we ask our patients to

diseases such as diabetes or high-blood pressure. Their

perform the necessary studies in their country of origin

argument is that obesity surgeries can easily be abused.

and to have them sent to us for evaluation.

When not performed by a correctly trained physician there can be many complications. Certain insurance companies

If we perform a risky surgery we talk to our patients and

cover obesity operations but it would be ideal if more

explain to them the many possible outcomes and make

enterprises included this kind of surgery.

suggestions regarding their preparation and the time they would need to spend in Mexico to have a successful

Q: Which were Cancun’s specific market conditions that

recovery. When risky procedures are requested by US

drove you to open the Anti-Obesity Center?

citizens we sometimes ask our US colleagues to give them

A: When we first arrived in Cancun, we noticed the city

pre and post-surgery attention. Throughout the years, we

lacked medical infrastructure and no one offered our

have consolidated important relationships. We combined

specific service. We are a multidisciplinary model clinic

efforts with doctors in the US for development of the

that

medicine

Full Sense stent that is placed on the patient’s stomach.

physicians, surgeons and dieticians. I trained on obesity

provides

psychological

care,

internal

Unlike other devices used in bariatric surgery, this stent

surgery and laparoscopic surgeries in the US but in

will prevent patients from feeling hungry by creating a

addition to obesity procedures, we offer gastrointestinal

sensation of pressure on the stomach. It is extremely

surgery, colonoscopies and endoscopies to name a few.

safe to put it on the patient since it is done through an

A high percentage of our patients are foreigners. If you

endoscopic procedure that does not take more than 20

search the words obesity and Cancun on the Internet

minutes. We developed it on 2009 and now we are in

our webpage is on the first page of results. A special

the latest experimental phases and waiting for Mexican,

department in our center is in charge of digital strategy,

European and FDA approval.

245



12

LOGISTICS & SUPPLY CHAIN

A growing pharma and health market has increasing logistics and distribution challenges. Companies have been improving their technological offerings to attract a bigger portion of the logistics industry and meet its highly specialized needs. They also are racing to reach remote geographies more efficiently. Mexican distribution companies now use thermo-technology and pressure gauges to maintain cold chains and protect delicate products, such as biological samples moving between hospitals and clinical research sites. Satellite tracking ensures the chain of custody is unbroken and products are delivered as quickly as possible, even with blockades and strikes.

Products are transported safely and seamlessly across regional and international borders with reduced waiting times for permits. Industry leaders are looking to secure certification and attract and train talented human resources. The industry is also concerned with the proper disposal of medical products and waste and some companies are now offering delivery services direct to patient homes. This chapter provides insight into how distribution and logistics companies keep the wheels turning in the health industry from behind the scenes and how they are overcoming the challenges the health logistics and distribution industry is facing.

247


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| CHAPTER 12: LOGISTICS & SUPPLY CHAIN 250

VIEW FROM THE TOP: Daniel Pardo, BOMI de México

252

VIEW FROM THE TOP: Juan Aguirre, Brudifarma

253

VIEW FROM THE TOP: Jaime Castro, ValidPro

Fausto Hernández, ValidPro

254

VIEW FROM THE TOP: Rubén Vargas, NTA

256

VIEW FROM THE TOP: José Aedo, SINGREM

257

VIEW FROM THE TOP: Patrick Troop, Pharma Tycsa

258

VIEW FROM THE TOP: Víctor Soto, Distribuidora Levic

259

VIEW FROM THE TOP: Rudolf Hess, R.H. Shipping

261

VIEW FROM THE TOP: Carolina Galicia, World Courier

262

VIEW FROM THE TOP: José Peña, Grupo Marzam

264

VIEW FROM THE TOP: José Mora, Farmalisto

265

VIEW FROM THE TOP: Rodrigo Amor, Marken

249


| VIEW FROM THE TOP

HEALTHCARE LOGISTICS FOCUS ON PATIENT SAFETY DANIEL PARDO Director General of BOMI de México

250

Q: What challenges are you facing as the new CEO of

fully tracked and controlled and which could represent a

BOMI de Mexico?

threat for patient safety. We are identifying how we can

A: There are several challenges in the healthcare and life

ensure that drugs are delivered to the recipient at the

sciences sector in Mexico that no company has been able

right temperature. The other line of action is developing

to fulfill. For instance, big companies are oftentimes limited

new products and services the market requires. We

by their own corporate processes and there are potential

are listening to laboratories, marketers, clinicians, to

customers that are not their typical target because they

understand what the gaps are so we can improve, be more

do not have the required qualifications or certifications.

efficient and take their brand and sales to the next level.

However, there are many things to be done to be closer

We are coming up with new solutions with their input –

to the patient and end-users while reducing the cost of

not only reducing overall costs, which is the main issue for

healthcare. There are still many inefficiencies along the

third-party logistics (3PL) but understanding what needs

overall supply chain that could be improved for patients

to be done differently. We are reaching new locations our

and healthcare companies and this is exactly what BOMI

competitors cannot warrant a visit due to a low number of

aims to solve. We want to bring the industry closer to

clinics and low volumes. For instance, it is very expensive

patients and clinics and solve some of the industry’s

for medical devices companies to service the southeast of

complexity to ease things for manufacturers and patients.

Mexico but by bringing them together we can make things more efficient and make sure we can get there faster and

Q: What are your plans to become a more relevant player

cheaper. Clinics could start providing some specialized

in the healthcare industry?

services there and patients would no longer need to travel

A: We have two parallel lines of action to achieve this.

400 kilometers to have a surgery.

We are looking for additional growth by several added value services that distinguish us from our competitors

Q: What role should logistics providers play to actually

and allow us to target additional customers while making

put patients at the center of the healthcare system?

the logistics process more efficient. We are the only

A: Patients are at the center of BOMI’s operations.

logistics company in Mexico focused 100 percent on the

They are what we live for and our slogan is “Saving

healthcare industry – with its own fleet, drivers, certified

and Improving Lives”. This is not about moving cases in

trucks, certified cold chain and certified packaging. This

warehouses, healthcare logistics are more difficult, so our

allows us to widen our market share. Cold chain is a big

checkpoint system is robust and identifies errors allowing

opportunity as it has several milestones that are not

us to service customers in a timely manner. A patient who has to get his or her monthly dose cannot skip his

“A patient who has to get his

medication because of logistic mistakes so that has to

or her monthly dose cannot

serve patients the best we can. We cannot be 99 percent

skip his medication because

have to ensure this 1 percent is covered by our backup

of logistics mistakes, so that has to be part of the culture

be part of the culture of the organization, working to accurate, 1 percent of inaccuracy is unacceptable. We processes before they occur. Q: How could integral services be further improved and regulated?

of the organization”

A: I truly believe that everything has room for improvement

Daniel Pardo, CEO of BOMI de México

Integral services cover some gaps at clinics, which are the

not because things are wrong but because of evolution.


point where end consumers receive the products and these facilities are not only managing supplies, they manage lives. Therefore, clinics need to partner with companies that can take full responsibility of materials and supplies and ensure lower costs, maintain minor inventories and ontime deliveries. Integral services to clinics, hospitals and laboratories will become more regulated on quality and compliance, and this needs to be reinforced in the entire value chain. As new clinics providing subrogated services open they must have the right licenses and comply with all requirements to operate guaranteeing patient safety. Discussions about the cost structure of integral services at clinics are not that relevant because in the end no manufacturer discloses how much it is charging for a certain active compound or material in the medication they commercialize, which is also true for healthcare services. Instead, costs become more important when they are charging lower prices for something that is not certified. Buyers need to question if some part of the delivered

A: Today customers want information and visibility

drugs come directly from the manufacturer and if some

about what they are getting and the need to get real-

could be counterfeit. Serialization and pedigree for drugs

time information is increasing significantly. This is why

and medical devices can reduce these risks. There have

we have a web platform on which our customers can

been several efforts to develop and implement regulations

track the shipment in a mobile app that allows for the

for serialization in countries such as the US and Brazil but

creation of digital signatures and picture taking of their

they are still a work in process. When this becomes reality

shipment. We allow customers the possibility to visualize

several players could leave the market due to the lack of

what is going on inside the warehouse. They have access

compliance. Yet I am sure BOMI is ahead of the curve. We

to a webpage where they can access information about

are the only logistics provider certified with ISO 9001 and

our quality system, track our processes and procedures

ISO 13485 in the healthcare industry.

for compliance, know how inventories are being handled, follow preventive and corrective actions and so on. We

Q: What led BOMI to win the National Award of Logistics?

also have an e-learning tool used by each of our employees

A: We were not doing home deliveries for dialysis in the

when a new process is implemented and it stores training

past but we started doing it with a new customer and

records. In the past, only providers could know about their

evolved from there. Therefore, we had to implement a new

own operations.

process, service and scheduling to make sure every patient was getting his or her monthly kit for dialysis. This not only

BOMI is completely focused on healthcare and our main

means ensuring patients get their kit but also having a

differentiator is that we do not replicate operations and

highly flexible agenda as every month new patients receive

knowledge from other sectors. Patients are what we live

the kit while others pass away. Some are located in remote

for and we want to make sure that our services are a

areas, which makes it more challenging. We literally had

valuable part of the chain. Helping the system to provide

to put kits on boats and horses to reach some patients so

better healthcare services is also our mission and we are

we were the first 3PL to achieve thorough integral service

determined to keep on growing with this in mind. Most

from start to end.

companies have more challenges to face than the year before. From the exchange rate pressure in finished goods

Public healthcare institutions are not able to reach all the

to raw materials, we have to work with our customers in

patients directly and that is why they are subrogating

order to do more with less. Another differentiator is that at

services. Even so not all patients are being reached.

a corporate level, big companies have a lots of processes

Remote and low income regions also require healthcare

coming from headquarters and we do not have all those

and we should develop a better structure for subrogation

guidelines that sometimes become obstacles. To deliver

to reach them.

bottom line results, you need to be fast and flexible. Our team is ready to make things happen and quickly start a

Q: What does BOMI offer through its business intelligence

new operation with procedures that are well defined but

solutions?

flexible at the same time, so we are leaner and faster.

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| VIEW FROM THE TOP

BUILDING A SOLID FOUNDATION OF COMPLIANCE JUAN AGUIRRE Commercial Manager of Brudifarma

Q: What new policies would you like to see implemented to

set up and have an interest in growing and doing things

create a more sophisticated market?

the right way. Our challenge is helping these independent

A: The changes that have been made so far have been

pharmacies comply with all the new requirements.

good for the industry but maybe the time frame should be

252

expanded. It is difficult and somewhat unrealistic to ask an

Q: How are you looking to increase your profit margins

industry to change the way it has been doing things in six

despite the drop in commodity prices?

months. Only the committed companies that have a long-

A: For Brudifarma, the name of the game in 2016 and 2017

term plan and are determined to invest will prevail and the

is regulation, not profit. We are looking to set up all kinds of

public will be sure that whatever product they get will be

workshops and information booths to help our clients and

top quality.

theirs. We sell to many small distributors that then sell to their own clients. We have to be ready for COFEPRIS’ new

Q: How do you select what products you will distribute and

rules in July-August.

what are your quality control processes? A: COFEPRIS’ new regulations allow us to access information

Q: What new technologies are you integrating into your

about new suppliers from that same institution. If we comply

processes?

with them, we can then move on to the next step. Since last

A: We have been working with SAP to transfer our clients

year, we have been sampling products and analyzing them

from an email-based order system to a CRM one. Once they

in our warehouse, requiring us to implement a whole new

are registered with us and we have certainty when it comes

quality control system in-house. We know and work with

to their files being in order and up to date, then they can

the top companies in Mexico and do not expect this order

start using a sort of online ordering process.

to be disrupted any time soon. Previously, there used to be a defined line between patent and generic medicine. Now

Q: What allows you to be positioned within the top three

there is a grey area in between. Many of the Big Pharma

main distributors of generics in Mexico?

companies are approaching us and starting to work with us.

A: Our first approach is to keep our customers happy, which allows us to help them grow. Lately, we have also

“If a new regulation is to come

been focusing on keeping COFEPRIS and the Ministry of Finance happy. We want to comply with the rules and be

into effect in July, we will be

one step ahead. If a new regulation is to come into effect in

compliant six months prior”

our customers also have to comply with the rules early on.

Juan Aguirre, Commercial Manager Brudifarma

to customers what we are doing, why and how we are

July, we will be compliant six months prior. This means that We have workshops every Friday during which we explain complying, allowing them to comply.

Q: Are there any risks that could impact your supply chain ? A: The biggest risk was financial and we passed that hump

Q: How does Brudifarma wish to impact the pharmaceutical

about five years ago when companies that could not keep up

and generic industry and what are your goals for the

started closing, leaving distributors unpaid and also leaving

coming years?

us unpaid. Now the biggest risk is compliance. There are

A: We want to be the best option for customers. We do

many pharmacies that do not want to or cannot comply with

not see ourselves as only a supplier but rather as a partner.

COFEPRIS. We have to shift from these small independent

We want to provide our clients with the best products and

pharmacies that were set up from one day to the next to

best prices as well as workshops to help them comply with

small local or regional chains. These have infrastructure

COFEPRIS and the Ministry of Finance.


| VIEW FROM THE TOP

VALIDATION SERVICES FOR THE PHARMA INDUSTRY

Jaime Castro Operations Manager of ValidPro

Fausto Hernández Business Manager of ValidPro

Q: What are the main challenges surrounding validation

validates computerized equipment. Our services cover the

practices in the pharmaceutical industry?

whole validation spectrum regardless of division or area.

JC: Validation services are expensive and even more so if

We must understand the industry undergoes systemic

a company allocates a whole division to it. This is not only

regulation restructuring, forcing companies to adapt to

true due to human capital training but also to the number

the changes. Therefore, there is always business to be

of devices and appliances needed in reading an analysis

secured and companies to be helped.

processes. As such, subcontracting validation services from companies like ValidPro is a better fit for most

Q: Considering the importance of securing competent

laboratories and companies. Our job consists of unveiling

human capital, to what extent does ValidPro have special

the company’s shortcomings, wrongdoings and areas of

relationships with academic institutions?

opportunity. As such, creating strong relationships and

JC: Even though we do not have specific alliances we

ties with our clients is crucial, especially as they will define

have worked with academic institutions through courses

the project’s success. Our first challenge is to be perceived

and conferences. We do not see these conferences as

as the entity that can help them solve their issues rather

a way to develop future ValidPro workers considering

than be seen as the enemy. Secondly, we must push for

the validation field of study is new in schools and

total compliance with the country’s regulatory framework,

universities. The company normally retains the services

which calls for added efforts, work and resources.

of

chemists,

pharma-biological

chemists,

chemical

engineers and pharmaceutical engineers due to their Q: What are the internal processes of validation? How do

underlying understanding of the manufacturing process of

you differentiate yourselves?

medicaments. When someone does not fully understand

FH: We have an internal system of quality control that

what a particular validation field of work entails then they

assures the quality of our services in a constant and

are called in for further training by ValidPro. The learning

permanent manner. This system is updated on an ongoing

curve for a trainee to become an A-level engineer is

basis. In the commercial area, we have created a new team

somewhere between one and one and a half years.

that caters to clients and gives them the attention they need. This has led to a sales boost that caused exponential

Q: Where do you see Mexico’s legal framework evolving

growth over the past three years.

and what are the trends that will push for this transition? JC: Trends will not only be defined by industrial

JC: We launch products with alliances and this has brought

technicalities but also by external factors like the country’s

great benefits to us. ValidPro is a company that has not

socioeconomic landscape and its politics. For instance,

been afraid to make alliances. We do not see competitors

COFEPRIS is receiving the ISO 9001 certification changing

as opposition but as complementary. This has allowed us

its perspective as a sanitary regulator and consequently

growth alongside other businesses.

shifting the way companies work.

Q: Who are ValidPro’s most relevant clients and what

The NOM-059 will enter into force by mid-2016 and we

services do they ask of you?

must all fall in line with it. The industry will be under more

FH: We work with top tier clients such as Boehringer

scrutiny due to the country’s economic environment but

Ingelheim,

Merck

its strength and importance on a global level will allow it

Sharp & Dohme, Pisa and Praxair. The services they

to minimize adverse effects. The instability of the Mexican

demand vary but we can provide a broad spectrum of

peso and other international currencies has impacted

services from the validation of entire manufacturing plants

manufacturing activities and its industries. But the market

to equipment and area qualifications. ValidPro also usually

continues to behave similarly to how it did in the past.

Laboratorios

Valdecasas,

Ulsatech,

253


| VIEW FROM THE TOP

NEW DRUGS REQUIRE NEW TRANSPORT METHODS RUBÉN VARGAS Director General of NTA

Q: How many of your competitors engage in similar

is not accounted for, we cannot ensure the integrity and

services to NTA’s new medicine delivery, medical and

efficiency of molecule components.

laboratory equipment services and materials for clinical

254

research and what impact has this transition had on the

Q: According to NTA, what are the new market tendencies

company’s profitability?

of the pharmaceutical industry?

A: NTA is a logistics company specializing in the health

A: For years, big pharmaceutical laboratories have either

industry, including clinical research and everything that

merged or acquired other laboratories to expand their

it entails. We have structured our distribution scheme in

portfolio. Others however, are specializing from within by

such a way that specialized infrastructure and machinery

creating specialty drug divisions. Chronic diseases such as

was needed. We also developed a distribution network

diabetes and cancer have become a pandemic problem

that could easily help us reach our clients as our drop-off

around the world and therefore major pharmaceutical

points are hospitals, clinics and research centers. We do

companies have turned their attention to them. In the

not only deliver manufactured products but also clinical

past, companies would strategize their sales by season,

analysis and biological samples. The latter represents

developing gastroenterology solutions for the summer

the most intricate part of our operations as it can refer

and respiratory drugs for winter. This is no longer true with

to organs requiring quick delivery times and adequate

chronic diseases. Suppliers are now expected to deliver to

temperature, humidity and handling control.

hospitals and clinical sites as well as private homes and offices.

We continue to lead the way in specialization services and the number and size of our clients is the best indicator of

Q:

this as we now service multinational giants like Johnson

regulatory framework?

How

have

these

transitions

affected

Mexico’s

& Johnson and Fisher Clinical. Not everyone can offer

A: It has influenced the distribution channel of the

comparable services, which include warehousing, portfolio

pharmaceutical industry. Previously, through the NOM-

control and distribution services, as well as terrestrial and

059 COFEPRIS only regulated drug integrity with

aerial delivery supervision. OTCs are the only product we

manufacturers and healthcare sites without watching

do not deliver as distribution volumes are high and do not

over the distribution phase. COFEPRIS now demands

fit our business model.

that laboratories oversee service providers’ compliance, ensuring product integrity throughout the supply chain.

Q: Considering OTC products represent a significant

As a result, from 2017 onward all distribution units must

proportion of the pharmaceutical industry, why did NTA

be equipped with temperature control mechanisms. Since

decide to exclude them from its operations?

our creation in 2000, regulations have evolved on a yearly

A: In today’s world, groundbreaking laboratories are

basis. We have seen the way the market has evolved,

focusing on biotechnological specialty drugs in line with

where laboratories merged with each other, growing their

health trends. The volumes of these products coupled with

production and distribution volumes. In return, NTA has

the desire of businesses to keep inventory numbers low have

learned how to become flexible in the way it works. In the

given way to our services. Maintaining a balance between

past, we only reacted. As of today, we can foresee what

low distribution units and low inventory numbers is tricky.

will happen further along the line.

However, the price of specialty products keeps economic performance up. Nonetheless, to ensure healthy profits,

Q: Last year, you were the only company with SMTC

precise and timely distribution is of the essence. We must

01 certification (service, handling, transportation and

also take the packaging and transportation temperature

custody certification). How does this differentiate your

levels into consideration, which must be set at 2-8°C. If this

services from others?


A: The SMTC 01 is a security certification implemented to service pharmaceutical companies. As the only company in Mexico that has secured it NTA can guarantee products will arrive safely. The certification covers the new subsections the NOM-059 is aimed at tightening. Our clients' patrimony is at stake during the distribution process, and the SMTC 01 reflects our ability to keep dangers to a bare minimum including damaged, lost or stolen goods. By complying in terms of safety we achieve the quality of service expected by our clients. With the enforcement of the NOM-059 sub regulations, companies will have to catch up. Even though we will see more competition from an expertise standpoint, we remain the first. There is a five-year history behind our accreditation,

“Suppliers are now expected to deliver to hospitals and clinical sites, as well as private homes and offices. In return, providers give their operators more responsibility as they must make sure the drugs’ integrity is not tampered with” Rubén Vargas, Director General of NTA

which has allowed us to further understand what our clients want and the challenges they need to overcome.

among others. Exterior audit programs are also put in

As such, NTA continues to understand the market’s

place by our clients, which can happen at any given time.

needs and evolve its capabilities. In addition, some

Through both, NTA systemically improves any deficiencies

small distribution companies with insufficient financial

and tightens its strongholds. Finally, we are measured

capital will not be able to comply with new temperature

and graded by Good Manufacturing Practices (GMP),

requirements.

which controls quality practices of the pharmaceutical industry and by the Mexican Society of Standardization

Q: In which ways does NTA ensure innovative means of

and Certification (NORMEX) that evaluates both safety

transport and quick responses?

and quality. As such, our results speak for themselves,

A: NTA has an in-house auditing program that takes place

securing between 96 percent and 98 percent compliance.

twice a year, overviewing every affair of the company. This

If we expect to service the health industry we must run

includes transportation, security, quality and delivery time,

parallel with what authorities expect of laboratories.

255


| VIEW FROM THE TOP

WASTE DISPOSAL REACHES 26 STATES JOSÉ AEDO Director General of SINGREM

Q: In 2008, CANIFARMA created SINGREM. What was the

waste to an authorized company that will destroy

strategy behind this?

the product. We receive a certificate of destruction

A:

256

The

law

states

that

manufacturers,

distributors

and elaborate reports for the authorities and the

and sellers of motor oil, batteries and cooking oil are

companies that are collaborating with us. The law

responsible for managing hazardous waste. In relation

states that all companies must either have a disposal

to medicines, pharmaceutical companies are obliged to

plan of their own or adhere to an existing one. We are

destroy the drugs used by households, hence a company's

the only program carrying out this activity. The most

obligation is not limited to when the drug is sold but

common disposed products are analgesics and anti-

until it reaches the expiration date. CANIFARMA decided

inflammatories, as well as antibiotics and products for

to create the National Waste Management System for

diabetes such as metformin. Unfortunately, only 100

Packaging and Drugs (SINGREM). Our aim is to provide

out of 200 pharmaceutical companies use this plan so

the necessary logistics to collect the product from

we are practically collecting waste for those that are not

consumers and ensure an adequate disposal. SINGREM is

attached to us yet. Sometimes companies incorrectly

financed by pharmaceutical companies. The pilot test took

believe that if they are not part of CANIFARMA they

place in 2008 and in 2009 more containers were set in

cannot be part of SINGREM. We serve companies like

several states. It was not until 2010 that the project began

Procter & Gamble, which is not part of CANIFARMA but

to operate at its full capacity. We started with a presence

belongs to the program because it sells OTC products.

in four states, then we established ourselves in Mexico City

At this point, 15 of the top 20 largest pharmaceutical

and we now cover 26 states.

companies are already in the program.

Q: How hazardous is medical waste compared to oil

Q: What are the main motivations for companies to

and industrial waste and what was the pharmaceutical

participate in the program?

industry’s main concern in this respect?

A: European and American companies in particular are

A: Lack of proper drug disposal increases the likelihood

more prone to joining us as they are usually extremely

of them ending up in the black market. This is particularly

responsible when it comes to complying with global

true for expired medication since packaging can be

regulations requiring them to implement waste disposal

easily counterfeited. Another concern is pollution when

programs. Local companies such as Liomont, Sanfer,

medicines reach the ground, rivers and lakes. We collect

Hormona, Psicofarma and Chinoin, just to mention a few,

about 40 to 45 tons a month. Northern states such as

are attached to the program as well but generic producers

Chihuahua, Sonora and Tamaulipas are not covered yet,

are still not incorporated. Given that generics represent

while the city of Monterrey was included in 2015. I believe

more than half the volume we collect, the situation is

we can collect 1,000 tons annually but at this point we do

aggravating.

not have the capacity or infrastructure to manage it. In 2008 we collected eight tons and this year we are going

Q: What expansion strategies are you considering for the

to be close to 500.

future? A: Next we are planning to cover Chiapas and subsequently

Q: What is the added value SINGREM provides and what

Tabasco. Logistical issues in terms of distance for northern

are the most common products found in your sampling

cities still limit our expansion plans in the medium term.

results?

We have a presence in Tijuana, where several destruction

A: We are authorized in the Handling Program and our

companies are based but it is still difficult to reach La Paz

responsibilities include placing containers in pharmacies,

and Los Cabos due to distance. We plan to have more

removing

containers in retail stores and pharmaceutical chains.

disposal,

sampling

and

finally

delivering


| VIEW FROM THE TOP

ADDED VALUE SOLUTIONS OPTIMIZE MEDICINE DELIVERY PATRICK TROOP Director General of Pharma Tycsa

Q: What is unique about Pharma Tycsa?

high prices and institutions have no option but to accept

A: The healthcare industry is looking for distributors with

them. This is something that should be regulated in the

proper infrastructure, systems, ethical practices and a

short to medium term.

strong transparency policy, which translates into a huge opportunity for us. In our first three months of operations

Q: How could public institutions further optimize their

we closed a contract with a public institution to which

processes and how are you helping to do so?

we distributed products and also created value for our

A: Our added value services always try to put patients

suppliers by managing the delivery of therapies to patients.

at the center. I believe the system is moving toward

To do so, we incorporated professional pharmacists in

cost optimization through consolidated purchases. The

the customer drugstores, something rather uncommon

next step for cost reduction is to manage inventories

in Mexico. The difference between having clerks and

and to keep track of where medicines go and how they

pharmacists in pharmacies is that the former just deliver

are delivered. The process to provide medicines to

prescription medicines, while the latter actually analyzes

patients in public institutions consists of purchasing

the prescriptions and makes sure they are in accordance

medicines, warehousing, distribution logistics, delivering

with patients’ records. This is a highly valuable service for

products to pharmacies and then giving them to

our customers because it adds a clinical component to

patients. There is a great opportunity to reduce costs

deliver better attention to patients. We have also developed

along this chain. We can get involved in some parts of

a new service called Clinical Breast Cancer Integral Service

it while institutions are fully responsible for others, like

aimed at delivering high-quality services to patients.

ISSSTE, that has subcontracted warehousing and logistic services while IMSS has not. Data collected from a 10-

Q: How are integral services transforming the way

year period worldwide show that more than 30 percent

healthcare services are delivered?

of prescriptions are done or processed incorrectly by

A: The definition of integral services should be clarified

physicians, nurses, clerks, among others. In Mexico, the

because some providers could use the term as a way to

rate of error is even higher. We have hired pharmacists in

avoid disclosure of the full range of services and costs

a public oncology hospital in the State of Mexico, where

they are charging. Integral services comprise a set of

we have already implemented some systems. Last year,

products, services, experience and information to take

we detected 2,000 incidences in a 40-bed oncological

full responsibility of a certain activity the government

hospital so we now have statistics representing the first

does not know how to do or should not invest in doing.

step to transforming the way medicines are delivered in

Whereas the private sector uses its resources more

the country. If drugs are administered to cancer patients

efficiently, public hospitals do not have enough budget

incorrectly the efficacy and safety of the treatment can

to acquire, maintain and repair equipment, which could

be compromised.

easily result in expensive and underutilized equipment. Integral solutions are therefore intended to provide better

Q: Where do you see the company at the end of the year?

services to patients, have more positive clinical outcomes,

A: We want to incorporate pharmacists in at least two

reduce bureaucracy in institutions and manage resources

more oncology hospitals and we want to expand our

more efficiently as a single, expert provider. Actually, some

Clinical Pharmacy Integral Service in some others. We

surgeries cost more for public institutions than for private

are also planning to launch a project for hospitals to

hospitals so there are more than enough opportunities

incorporate a system that was developed by us to track

to optimize processes in the public system. On the other

the actual number of prescriptions delivered to patients.

hand, the bargaining power of integral service providers

This will make the process more transparent and help

has reached a point in which they are capable of charging

public institutions reduce unnecessary costs.

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| VIEW FROM THE TOP

LEVIC GROWS INFRASTRUCTURE TO EXPAND REACH VÍCTOR SOTO Director General of Distribuidora Levic

Q: How do you ensure the quality of products is

operations as we take this health alternative to pharmacies

maintained during transportation?

and homes. It is our raison d’être.

A: Medicine is delivered in containers to avoid damage to

258

the secondary packaging to the greatest extent possible.

Q: What is being done to minimize losses in times of

Our vans have combined temperature and pressure gauges

strikes and blockades and how do you continue to ensure

and air conditioning for warm climates. We ensure a cold

product quality?

chain for products that require special temperatures.

A: Products and supplies are made ready for delivery and

In both cases the temperature is constantly monitored

channeled through our logistics area, which uses satellite

assuring that even when products are transported over

location to determine an efficient route. In zones of conflict,

long distances, all safety, quality and trust standards are

we use satellite to permanently monitor the delivery on top

maintained.

of the standard means we use to maintain product quality.

Q: Who are your principal clients?

Q: What challenges is the distribution industry facing and

A: Our principal clients are independent pharmacies,

how is Distribuidora Levic overcoming them?

hospitals and clinics, regional distributors and some

A: The greatest challenge the industry is facing is being

government offices.

able to cover medicinal needs in every corner of the country. Levic has growing infrastructure that allows us

Q: What are your most important alliances?

to reach further and further away, satisfying the medicinal

A: We work with different pharmaceutical associations such

needs of our clients and commercial partners.

as UNEFARM, Farmacias Tradicionales and ANAFARMEX. Q: What rates of growth have you seen and what growth

“The greatest challenge the industry is facing is being able to cover medicinal needs in every corner of the country” Víctor Soto, Director General of Distribuidora Levic

do you foresee? A: There is much talk of growth in the pharmaceutical market. We have seen sustained double-digit growth and we wish to continue in this way to enter new markets. Q: In light of the wave of expansion of Mexican companies in the world, has Levic spotted an opportunity to expand to other zones such as the Caribbean or Central or South America? A: We are already working on this with our commercial

Q: What are your best-selling products?

expansion department. We aim to enter the Central

A: It varies, as we sell high volumes of pharmaceutical

American and Caribbean markets.

products for respiratory diseases, infectious and chronic illnesses.

Q: What plans do you have for 2016/2017? A: A new distribution center in Monterrey is underway.

Q: What effect will the government budget cuts have on

We

your operations?

distribution center to its maximum potential and we are

A: The fewer resources that are allocated to health, the

also opening two more secondary distribution centers,

more the population will be forced to buy the best quality

which will allow us to reach states in which we do not

medicines they can by their own means. As one of the

have a physical presence and enter Central American

main distributors of generics, this strengthens our area of

markets.

are

working

in

developing

the

Mexico

City


| VIEW FROM THE TOP

STRUCTURE AND EXPERTISE KEY TO GROWTH RUDOLF HESS President and CEO of R.H. Shipping

Q: How does R.H. shipping ensure the adequate

perishables have allowed us to be part of the logistics

transportation of delicate samples for the health industry?

of many important companies inside and outside

A: We follow and monitor the temperature of shipments

Mexico. We offer many transport solutions for general

through thermo-sensors in accordance with negotiated

and specialized cargo, maintaining our position in the

space with airlines and maritime shipping companies that

market for over 20 years and strengthening bonds with

have refrigeration and temperature control services.

our clients. This has positioned us, a Mexican company, as one of the top five freight forwarders in the various

Q: How do you ensure the chain of custody?

industries in which we operate.

A: Through the sensors in the cargo, we keep the client informed of any event or diversion.

Q: T21MX reports that R.H. Shipping is expecting 20 percent growth this year. To what extent is this true and

Q: What expertise have you gained from the perishables

what are the drivers behind this growth?

industry that can be applied to the transportation of

A: In 2016 R.H. Shipping showed a significant increase

goods for the health industry?

in the volume of air exports. According to IATA, we

A: We ensure the management and monitoring of the

are in the top five freight forwarders in Mexico every

cold chain and temperature control to maintain optimal

month. This reflects the excellent work accomplished

conditions, to preserve the hygiene of the product and to

by the perishables division and the general division,

offer clients the best service in the pharmaceutical and

and R.H. Shipping hopes to close 2016 with even better

perishables sector.

rankings. We hope that 2017 will position us within the top three freight forwarders in IATA rankings. Besides,

R.H. Shipping is a leader in handling perishable cargo. The

our maritime shipping sales have also grown in a manner

company is looking to apply the know-how obtained in

that has enhanced our negotiation power with shipping

perishables to the pharmaceutical industry and wants to

lines.

become a reference within the next year in the logistics industry for handling pharmaceuticals.

Q: What is the importance of the health industry for R.H. Shipping?

Q: What places you ahead of your competitors in the

A: It is important for R.H. Shipping due to the high demand

Mexican distribution industry, specifically for biological

that it represents globally. The expectation is that it will

samples and medication?

continue to grow in the future. As a logistics operator

A: We guarantee the correct handling of the cargo,

R.H. Shipping will be able to offer high-quality services

helping to reduce risks, costs and transportation time.

according to our customer needs. We have the structure,

We give personalized professional advice for our team of

expertise and capable staff to grow in alliance with the

dedicated professionals. We also have technological tools

pharmaceutical industry.

that allow us to innovate to offer more efficient channels of communication including visualization and generation of reports for our personnel and clients.

“We hope that 2017 will position us within the top

Q: How important are your Mexican operations for you globally? A: Mexican operations are extremely important for

three freight forwarders in

the company as the high volume of imports and

IATA rankings�

exports from other industries such as oil and gas and

Rudolf Hess, President and CEO of R.H. Shipping

259


260


| VIEW FROM THE TOP

GROWING DEMAND FOR SPECIALIZED STORAGE FACILITIES CAROLINA GALICIA Director General of World Courier

Q: How is the change in pharmaceutical company and

embedded controller interface (HECI) specifications.

clinical trial budgets affecting World Courier’s business?

Our clients expect this. We are frequently audited in line

A: It has definitely affected all those in the industry and

with the high standards required by GxP. Our clients are

everyone is looking for more value for money. Fortunately

constantly looking for more options, weighing costs and

as we have a great deal of experience, particularly in

benefits together with adherence to protocol and study

clinical trials and we follow Good Manufacturing Practices

specifications.

(GMP), good distribution and clinical practices, this has not resulted in serious difficulties for us or our clients. We

Q: What are the greatest risks in pharma at the moment?

have 14 warehouses dedicated to clinical studies. We have

A: As the industry employs extremely high-quality

more than 140 offices in over 50 countries. We are more of

products, shrinking budgets may be the biggest risk

a partner than a vendor to clients.

for everyone to maintain standards for patient safety. Processing times, permits and changes in government all

Q: Are you still growing in Mexico?

affect how we can do business. Recruitment and retention

A: Yes, in spite of market difficulties we hope to continue

rates of patients for studies are critical and failure to

our growth in the coming years. We are looking to grow at

maintain these will affect the industry greatly.

around 20 percent and offer more exclusive services. The clinical services market on Mexico is consolidating, which

Q: What is driving your business in Mexico and what will

is why we are focusing in other sectors too. Growth of the

we see in years to come?

market in general is difficult to measure and our numbers

A: Right now, the greatest demand is in storage and

do not correlate exactly with the market.

distribution in contrast to transport. Mexico is a vast country and we are interested in entering other states, like Jalisco.

Q: Why is Mexico becoming a more attractive market for

We will continue to specialize in pharmaceuticals. Our new

clinical trials and how is this trend growing?

invention, Cocoon™, is a type of packaging designed for

A: In the past, regulatory framework impeded us from

larger bulk supply shipments. This was created for use in

doing many things, including clinical trials, because many

pallets, with specific temperature requirements. Cocoon

companies lacked COFEPRIS’ authorization. This has

is a game changer for us as it is extremely light when

stabilized and the number of protocols we are working

compared to other packaging options on the market.

with has grown. Our location also makes Mexico an

Weight is typically reduced by 25 percent. Within the

attractive country to work in, with a diverse population

pharma supply chain, we offer a service called “Direct to

that is ideal for studies helped, by our close proximity to

Patient” where deliveries go to the patient at home or into

the US.

the hands of a medical professional caring for them. This is already in place in around 40 countries including the US.

Q: What are the tendencies in pharma logistics in Mexico?

We have the regulations in place to roll this out in Mexico.

A: Storage is definitely a trend, as we have seen across

What often causes patients to withdraw from a study is

our 14 depots. Standardization of services and having

that they cannot easily attend the place where the study is

strategic locations in emerging markets, particularly in

being held, particularly when they are sick.

Latin America, is very important. Either direct distribution or depots are needed. Depots must adhere to the

ASD Healthcare, also a part of our parent company

conditions required by the client and the regulators.

AmerisourceBergen, offers myCubixx, a small refrigerator

Any company providing such a service must have the

that can be kept in a pharmacy or in a patient’s home,

necessary

scans the medicines inside and automatically orders new

staff,

processes

and

documentation

and

control the temperature, with demands such as host

supplies when specific stocks are low.

261


| VIEW FROM THE TOP

EFFICIENCY DRIVES GROWTH FOR DISTRIBUTION JOSÉ PEÑA Director General of Grupo Marzam

262

Q: What does your recent decision to take a new

companies expect from distributors. I think more synergies

professional direction, moving from the pharmaceutical

could be created between the pharmaceutical industry,

sector to the distribution industry, mean for you?

points of sale and the government. We must also make an

A: I want to implement different ideas and practices

effort to emphasize the importance of distributors in the

from the pharmaceutical industry and provide insights

healthcare supply chain. The healthcare system cannot

on what the industry requires from distributors. I

function without distributors, so strengthening the image

think there are more synergies to be created between

of Grupo Marzam as an essential actor in the value chain is

pharmaceutical companies, the points of sale and the

a priority. We have the opportunity to position ourselves

government regarding distribution. I also believe we must

as a truly critical and unique provider for the industry.

make a concerted effort to emphasize the importance of distributors in the healthcare supply chain. The

Q: What does Münch Cooperatif owning the majority

healthcare system cannot function without distributors,

shareholding of Grupo Marzam represent for the

so strengthening the image and value of this segment of

company’s future?

the value chain is a huge priority. With this in mind Grupo

A: Münch Cooperatif purchased 51 percent of Grupo

Marzam has the opportunity to position itself as a truly

Marzam shares and our intent is to be a strong actor in

critical and unique provider for the healthcare system.

pharmaceutical distribution in Mexico. This is a long-term project that represents both a challenge and opportunity

Q: What are your immediate plans as the new Director

to take the company to the next level and become a major

of Grupo Marzam?

player. In the long term we are committed to increasing

A: Innovation in the distribution segment has been

our stake in the company. We will introduce several

lacking in the past decade, therefore, we are excited to

innovations to Grupo Marzam’s structure, business scope

start looking at things disruptively, hoping to provide new

and technological capabilities to become the supplier of

services. Customers want new things so we plan to focus

choice, not necessarily the largest one, but the smartest one.

on efficiency. Considering that margins in distribution

Grupo Marzam is also determined to become a strategic

differ greatly from those of pharmaceutical companies,

partner for our customers regarding business development

implementing the right organizational structure and

and execution. It is essential to think differently. Looking at

capabilities will certainly help us optimize our processes

the distribution sector today, the vacuum left by Casa Saba

and costs. Today, about 96 percent of our profits come

has already been filled by three major distributors and by

from the private market and this will continue to be the

companies developing their own distribution channels. We

priority for the next five to 15 years. However, we still want

have moved into a new stage for the industry. There are a

to grow our public sector customer base. Multinational

lot of things we can learn from Casa Saba so that we do not

pharmaceutical companies are increasingly focusing

follow the same path.

on specialized medicines such as biotechnology and oncological drugs, which are mostly bought by public

Q: How does fragmentation of Mexico's healthcare

institutions. The public sector represents 44 percent of

system impact the distribution segment?

the pharmaceutical market, therefore, we cannot afford to ignore it.

A: Mexico is considering healthcare universalization, which I think is still at a conceptual stage. The country’s healthcare system is complex because there is no single

Q: What role do you think distributors should play in

healthcare provider and having a highly fragmented

today’s healthcare industry?

system makes it difficult to implement an effective

A: Having spent 25 years in the pharmaceutical industry

strategy across the country. Having a single healthcare

has allowed me to fully understand what pharmaceutical

provider could certainly make operations more efficient


but it could represent fewer opportunities for players used

the industry and end user. This could lead to reducing the

to negotiating with different institutions. Consolidated

gap between manufacturers and the final client by using

purchasing, for instance, makes supply of goods difficult

strategies such as home delivery. Grupo Marzan is known

to a certain extent because of the large volumes

for its deep understanding of the industry, which results in

demanded and negotiating with a single supplier is riskier

trust building and strong client relationships.

for institutions. We have to closely analyze procurement methods and evaluate their success in providing medicines,

Q: How are you facing the changing landscape in the

devices and diagnoses to the population.

retail market? A: The market has seen a significant amount of changes,

Increased collaboration between the private and public

including pharmacy chains consolidating. As some

sector is worth our attention. There are nearly 30,000

expand there are fewer independent pharmacies, but this

pharmacies in Mexico that could be pivotal in drug

trend will shrink. In terms of distribution we still need to

dispensation for the public sector. Private hospitals

mind the different channels. Supermarkets and pharmacy

could also become more relevant in supporting public

chains require different services than independent

institutions by overcoming their weaknesses. There

retailers or private hospitals. Independent pharmacies

are a lot of private and public partnerships involved in

will continue to rely on large distributors and represent 25

building new hospitals but more partnerships are needed

percent of our sales, while pharmacy chains constitute 30

to deliver higher quality services to the population. It is

percent and are currently establishing direct commercial

important to visualize how the healthcare sector is going

relationships with pharmaceutical companies.

to move forward.

263

They will never purchase medicines from a single The dominant model today is cutting prices but there

company though, so the role of distributors is still

is a limit to it. Grupo Marzam needs to focus on being

extremely relevant. Grupo Marzam has 10 distribution

a reliable supplier and offering appropriate distribution

centers and 30 sub-distribution centers across the

solutions. In the past, there was no significant focus

country, supplying 420,000 units of medications per

on efficiency, margins were greater and there was less

day and covering 18,000 pharmacies so there is robust

pressure on pricing. This has completely changed and

infrastructure to capitalize on.

prices of both generic and innovative medicines in Mexico are among the lowest in the world. Efficiency in all

Q: What role does digital technology play in improving

activities could be one of the major factors contributing

distribution efficiency?

to success.

A: Our customers want to know in real time the status and location of their products to make quick decisions. IT

Q: What growth strategy would you consider efficient

platforms are an area where we can grow and differentiate

given the different sectors and market segments?

ourselves to provide more effective solutions to our clients.

A: Product segmentation is essential to devise effective strategies for tackling the different sectors. We must

We have several IT projects at advanced stages aiming

make sure that we have a clear strategy for generics in

to optimize times, resources, routes and follow-ups. We

both the public and private markets since Mexico is the

are looking forward to implementing them in the short to

top consumer of generics worldwide as they comprise

middle term.

84 percent of all drugs distributed. We must also focus growth on the distribution of specialty products, such as biotechnology drugs, oncology and orphan drugs, since these areas are evolving and sustaining the importance of delivering value to our customers. One of our priorities is to deliver quality services that will differentiate us from a simple logistics provider transporting cargo from point A to B. We must ensure client satisfaction by optimizing processes and working closely with our commercial partners in implementing new business models such as shared risk and pay for performance. These are becoming increasingly important

“Prices of both generic and innovative medicines in Mexico are among the lowest in the world. Efficiency in all activities could be one of the major factors contributing to

given public sector budget constraints, so we should

success”

master their implementation to become a catalyst between

José Peña, Director General of Grupo Marzam


| VIEW FROM THE TOP

MEDICINE ON DEMAND

JOSÉ MORA CEO of Farmalisto

264

Q: What are the market conditions and opportunities that

they will eventually need. Farmalisto contacts its clients

led to the creation of Farmalisto?

a few days before they run out of medicine as to prevent

A: Farmalisto started operations in Colombia more than

them from enduring any complications. We have recently

two years ago. We are an online company that operates

focused on patients with hypertension, diabetes and high

in Mexico as much as it does in Colombia, making its way

cholesterol, all of which need close follow-up. Offering

to the local market in 2015. E-commerce is the newest

the lowest market price is one of Farmalisto’s business

trend in business and Farmalisto is taking advantage of

promises. If clients find better listings Farmalisto matches

new technology and available distribution channels for

the price and deducts double the difference in their next

prescription and pharmaceutical products. Farmalisto

purchase. That is to say, clients get a MX$10 (US$0.5)

saw an upsurge in e-commerce opportunities especially in

discount if there is an initial MX$5 (US$0.27) difference.

large cities where mobility is an issue. Traditional pharmacy stores also have limited storage space, which could

Q: What led Farmalisto to come into the Mexican market

mean product scarceness. Farmalisto’s goal is to provide

rather than expanding into the South Cone?

ongoing support and comfort to the clients that need it

A: There are two key reasons why Mexico made sense

the most. Some of our clients suffer from chronic diseases,

to us. Firstly, it is the second largest Latin American

forcing them to purchase their medications on a monthly

market following Brazil. Secondly, the out-of-pocket drug

basis. As such, Farmalisto follows up on the status of its

payment percentage in Mexico is nearly 80 percent.

clients, making sure the right dose was purchased at the right time. By knowing our clients have properly followed

As such, Farmalisto foresaw that Mexico was essential to

their treatment, side effects are kept to the lowest point.

its success. Our strategy is to attract direct consumers rather than state institutions, which perfectly fits Mexico’s

Q: How does Farmalisto comply with its three-hour

market conditions.

delivery promise in an environment such as Mexico City? A: Farmalisto has specialized in logistics operations since

Q: How did the Farmalisto Esencial program get started

birth. Creating demand, having efficient purchasing

and what results have you reached from this initiative?

schemes and becoming experts in logistic operations are

A: Patients constantly look for added information regarding

three main elements to the company’s business model

their medical conditions especially in therapeutic areas.

success. If Farmalisto does not have sufficient logistics

Therefore, we created categories for Mexico’s largest

power, creating high service demand is pointless. We have

market segments, where clients have the opportunity to

a fleet of 15 motorcycles that service inner-city customers,

ask questions and get a referral to companies that can

coupled with key partnerships with FedEx and DHL

further provide information. Patients value information and

that cover the rest of the country. On average 30 inner-

our program has helped them in their efforts. If patients

city orders are delivered daily in our around-the-clock

have not found a good supplier Farmalisto Esencial helps

schedule while keeping flexibility at the top of our agenda.

them purchase the drug they need.

Although Farmalisto does not operate day-and-night outside of Mexico City, we are evaluating the possibility

We provide optimal information while helping clients

of doing so in the near future. If demand grows our fleet

reach the medicine they truly need. By receiving this type

will grow too.

of support from the pharmaceutical industry clients have more inclination to use our services, creating brand loyalty.

Our SugarCRM database enables Farmalisto to keep close

Our business model calls for constant evaluations in each

track of its client’s treatment, as doses and intakes are

operational activity. The Farmalisto Esencial program has

recorded allowing it to assess the number of packages

positively impacted our sales with a clear ROI.


| VIEW FROM THE TOP

STRATEGIC ALLIANCES IMPROVE THE SUPPLY CHAIN RODRIGO AMOR Branch Manager of Marken

Q: Marken is within the top 3 medical commercialization

and it was common to use on-board couriers to collect

and logistics companies. What strategies have you

these. This came at a high cost. The development of a

implemented to maintain your position and business in

more efficient logistics network with dedicated personnel

Mexico?

and strategic alliances has allowed the creation of better

A: Marken opened a large Good Manufacture Practices

and less expensive routes, facilitating the transportation

(GMP) depot two years ago and just rolled out Marken

of goods. These strategic alliances include airlines, a great

Allegro, an online booking tool for all research sites

advancement for the industry. We have a strong alliance

in Spanish. We have moved to offer direct to patient

with Aeroméxico, which has allowed us to increase the

services and are leaders in this area. We are now heavily

efficiency of routes while reducing transit time as well as

investing in the supply chain services for cell, gene and

costs increasing visibility and quality.

immunotherapies as a key focus of our industry demanding high-quality services with GPS tracking and full chain of

Q: Why were airlines not part of the supply chain before?

custody.

A: This was mainly because of a lack of knowledge surrounding biological samples. The majority of samples

Q: How has this tracking system contributed to a reduction

we transport are at room temperature or frozen with dry

in costs of your internal operations and was it developed

ice, and Marken provides the proper type of packaging per

in association with another company?

temperature for shipment, which facilitates transportation

A: The software was initiated by a developer and Marken

and reassures airlines into being part of the supply

acquired the rights to it before it was finalized. This was

chain. We worked closely with them, showing our

extremely convenient as we were then able to adapt it

secure transportation of samples and demonstrating the

to our requirements. It allows us to monitor costs more

packaging is specifically made for this use. We explained

closely and helps with our visibility. Regional operative

that dry ice might be at risk if it is packed in an airtight

directors were also involved in the development phase.

container but the industry has now developed ventilated

We made sure it offered optimal traceability, letting our

ones. These sorts of technological advantages play a big

customers know when the product was shipped and when

part in bringing airlines into our supply chain.

it is expected to land so they can plan for its reception with minimal time lost. We enter routes into the system

Q: What areas of opportunity do you see within Mexico’s

and then assign a cost per shipment. We can thus see

legal framework that would facilitate and improve

what cities or routes provide better costs and find ways to

business without compromising quality?

improve the situation in those that don’t.

A: One area of opportunity may be the excessive fiscal controls that companies with international transactions

Q: One of the industry’s most important objectives is

such as Marken are subject to. Certain controls are

cost reduction. What are the biggest challenges these

undoubtedly necessary and a new trend has emerged in

companies will have to overcome to succeed?

making them electronic. Commercial and shipping invoices

A: Companies want cost reductions but they are also

will soon become digital, putting our transit times at risk.

managing more complex projects. The strategies that we

Instead of having the customs broker or Marken produce

have put together to respond to this involve making our

this document we will have to reach each CRO to generate

processes as efficient as possible in addition to creating

this digital receipt with their complement and they do not

strategic alliances with commercial partners. A few years

necessarily have the time or knowledge. In this respect,

ago, the routes to transport drug product and biological

the transport of biological samples is treated by fiscal

samples were much less developed, leaving companies

authorities as a commercial product. The industry is actively

with few options. Recovering samples was a challenge

working to avoid this disruption in cooperation with SAT.

265



MEDICAL TOURISM

13

The medical tourism market continued to grow in Mexico over the past year. Globally, Mexico occupies second place for medical tourism, behind Thailand. Many opt for Mexico due to its affordability and high-quality medical care and many doctors have trained both in Mexico and abroad in the US or in Europe. Institutions are actively seeking both local and foreign certification to bolster their appeal to tourists.

According to ProMĂŠxico, nine hospitals and one medical complex in Mexico are accredited by the Joint Commission International (JCI) and 96 are certified by the Ministry of Health. Others have relocated their facilities to medical tourism hubs such as Tijuana, Cancun, Merida or Monterrey and use brokers to attract more foreign clients. Many insist their staff speak English so patients feel secure at all times and understand the steps of their medical treatment or surgery. These services are increasingly attractive as healthcare centers arrange complete holiday packages for their patients, making a procedure performed abroad the least complex possible.

This chapter looks into the evolution of medical businesses to adapt to this inflow, what strategies they are implementing to attract more clients from abroad and how local government entities are aiding clinics and hospitals.

267



| CHAPTER 13: MEDICAL TOURISM 270

VIEW FROM THE TOP: Servando Acuña, Quintana Roo Medical Travel Association

271

VIEW FROM THE TOP: Regina Garza, Parque TecniA Universidad Anáhuac

272

VIEW FROM THE TOP: Eduardo García, Clúster Ciudad de la Salud and UDEM

273

VIEW FROM THE TOP: Mario Estrada, UROSUR

274

VIEW FROM THE TOP: Rogelio Villarreal, Centro de Oftalmología Monterrey

276

VIEW FROM THE TOP: Alexis Acuña, Cancun Oncology Center

278

VIEW FROM THE TOP: José Gaytán, Fertility Center Cancun

279

VIEW FROM THE TOP: Mayra de la Garza, IREGA

280

VIEW FROM THE TOP: Alma Orozco, Tijuana Bariatrics

282

VIEW FROM THE TOP: José Claros, Videre

284

VIEW FROM THE TOP: Javier Flores, Hospital San José & Hospital Zambrano Hellion

285

VIEW FROM THE TOP: Ricardo Segovia, CostaMed

286

VIEW FROM THE TOP: Javier Loria, Dentistar

287

VIEW FROM THE TOP: Alejandro Laguna, Coral Dental Center

269


| VIEW FROM THE TOP

A GROWING MARKET OF EXPAT RETIREES SERVANDO ACUÑA Director General of Quintana Roo Medical Travel Association

Q: How did medical tourism begin its development in

that per year he or she will spend US$48,000. A hundred

Quintana Roo?

US citizens living in the city will spend approximately

A: In Cancun, medical tourism started because of numerous

US$4,800,000 per year. A percentage of this amount

time-share ventures. People came on vacation for a week,

would be spent on doctors and hospitals. This is why the

got sick, had to go to a doctor or a hospital and they liked

retiree population is an attractive market for us. When

the service so much that next year they came for vacation

retirement enterprises visit us, the first thing they ask

and decided to schedule a doctors’ appointment. Coming

about is our health system.

on a vacation became an excuse for going to the doctor. 270

This is what we call informal medical tourism. Organized

Q: Why should patients choose Cancun or Cozumel over

medical tourism involves actively planning and promoting

other medical tourism destinations?

the advantages of medical services offered in Mexico.

A:

Unlike

many

other

places,

in

Cancun

medical

responsibility is mainly in the hands of the hospital as an Five or six years ago, we noticed the health situation in

institution. Those taking responsibility for patients’ lives

the US was reaching a critical point. Private healthcare

are medical institutions. Cancun depends completely

prices had increased enormously and public health

on the tourism industry, which is why we are so

services had various limitations. Around that time, we also

professionally committed to positive outcomes for our

discovered that Canada’s health system is insufficient to

patients. Our hospitals and doctors’ certifications are

cover Canadian needs in a timely fashion, indicating an

an important selling point. To obtain a certificate from

important window of opportunity. We needed to identify

the General Health Council (CSG), hospitals need to

the most common medical procedures people were in

comply with requisites as measurable as quality results,

need of and if they were elective or non-elective. We

patient safety and clinical outcomes. This involves a long

identified at least five different areas to focus on. Bariatrics

checklist of requirements. An important thing to take into

procedures were a natural option, as Mexico and the US

consideration is that CSG and the JCI have homogenized

have an increasingly overweight population creating a

their certifications. Mexico is the only country to have

niche market. Orthopedics treat many patients for knee

homogenized its certification. This means that if you

and hip replacements due to the aging society. The third

approve the Mexican Certification then you have already

market opportunity was cosmetic surgery. We also treat

approved around 80-90 percent of the US certification.

patients in dentistry, which is a sought after specialty.

Having this accreditation is commercially important.

Fertility clinics were also an important opening. Finally, we

Without the JCI seal of approval, insurance companies

want to investigate stem cells procedures. R&D facilities

will not pay for procedures. Therefore, we worked actively

are contributing to this area. Bio-cellular medicine has

to comply with their conditions.

become an important niche and is considered the future of medicine.

Q: How have the cities benefited from the development of the medical tourism industry?

Q: Is there a specific niche market in which you expect

A: Medical tourism not only creates job opportunities but

Cancun to thrive?

also contributes to the improvement of medical services

A: We have a growing market regarding medical tourism

for foreigners and nationals. Due to the constant influx

services, but we would like to attract a bigger retirement

of foreign patients, hospitals are being provided with the

community. There are more than 1 million US citizens living

resources they need to modernize their facilities to offer

in Mexico. Each of these retired citizens has an average

higher quality health programs for the least wealthy. We

income of US$3,500-4,500 per month. A US citizen living

are extremely proud of our certifications because we can

in Cancun will spend US$4,000 monthly, which means

offer quality medical services to national patients.


| VIEW FROM THE TOP

MEDICAL COMPLEXITIES FROM ACADEMIA REGINA GARZA Director General of Parque TecniA Universidad Anรกhuac

Q: Why does the university see value in becoming part of

university, as we must provide adequate training, not only

the trend of medical tourism in the region?

in terms of the medical profession but also in terms of

A: Previously, healthcare was about the social aspect and

customer service for patients.

caring for patients, but tourism has come along and made healthcare into more of a business. This can bring a great

Q: How has Universidad Anรกhuac strengthened the value

deal of economic advantages. It is our job to teach about

chain with medical training?

these kinds of trends and to identify areas where we can

A: We are working extremely closely with the Ministry

create value. One of the first contributions made by the

of Tourism (SECTUR), to form various forums. The first

university to this industry was in innovation.

platform we organized was with an international partner that focused on understanding generic concepts like

In 2008, we completed a specific analysis of medical

that of Medicare and funding for healthcare costs. I am

tourism in Mexico and we found that in the Baby Boomer

also a consultant for COPARMEX, which has a mandate

generation, many were looking to move to a different

to promote medical tourism, so we have been working in

location, so more than medical tourism, there was a type

collaboration. We have recently had a proposal approved

of assisted living. Naturally, Yucatan became the nucleus

by the National Council for Science and Technology

of this activity and many people moved from Canada or

(CONACYT) to carry out an analysis in terms of both

from very cold states in the US to spend their winters or

business and the value chain of medical tourism, and we

their retirements here. Obviously, these people needed

have an agreement with the Universidad Iberoamericana,

healthcare and they began to bring their friends and

which is working on some other projects.

family to take advantage of the quality and the low cost of medical treatment in Mexico. The question at that

We must first break paradigms. The main way we would

point became whether or not we had the facilities to

be able to obtain hard data on these indicators is by

accommodate this demographic, which prompted another

going to the source, which is of course the medical

analysis. We began to make small changes in terms of

records held at clinics and hospitals. It is astounding that

infrastructure, hygiene and access. At this point, the

so many people seek dental attention, yet no records

Mexican system was strengthening because a great deal

are kept because the clinics do not consider patients

of focus was placed on safety and security, so locations

that come from other countries. We must also make

like Merida began to be considered more as a place to live

the difference between medical tourism and tourism

or for a second home.

for purposes of wellbeing. For this reason, municipal authorities must be present to outline a proper definition

Q: Can you break down the value chain of medical

of medical tourism.

tourism, especially related to Yucatan? A: We have the hospital infrastructure, which is at the

Q: How are you spreading the message about medical

center of the chain. Clinics provide support for primary

tourism to different markets abroad?

levels of attention. However, the value chain is not strictly

A: Our main aim has been to spread the message that

limited to medical practices but also includes hotels,

medical tourism is not only the concern of one sector but

logistcs, transport services and restaurants that provide

several, including tourism, health and academia. We have

food to aid patient recovery. The role of the facilitator

been present at various international events and we have

in this sense is relatively new and is not well understood

been gradually raising the profile of Merida and putting it

because we are not talking about a travel agency that sells

on the map. We must all make an effort as a group. We are

a package deal. Rather, there are more components that

also trying to develop a degree in Medical Tourism to align

need to be considered. We also have a role in this as a

with the concepts of the new industry.

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HEALTH CITY SETS THE GOLD STANDARD EDUARDO GARCÍA President of Clúster Ciudad de la Salud and School of Health Sciences Dean of UDEM

Q: How many foreigners from abroad come to Monterrey

hospitals in Chile and are entering the Colombian market.

in search of private health care?

This helps patients move back and forth. They also have

A: The security crisis that occurred in 2010-2012 challenged

hospitals in the US that show how hospitals in Monterrey

Monterrey’s health industry and the number of foreigners

look. Monterrey's ITESM also has a good reputation and is

dropped. Now the numbers are starting to grow again.

well known in the US and Latin America.

Around 30,000 foreign patients receive treatment but we

272

are not yet at the levels previously seen. The cost-benefit

Right now the Committee for Promotion is working on

in being treated in Monterrey is attractive, especially

designing a strategy to relaunch the Monterrey brand as

with short driving distances or direct flights to major US

a health service city internationally and also to strengthen

cities. Many of the hospitals’ doctors comply with the JCI

Monterrey’s position in the internal market.

regulations. As a matter of fact, our accreditation process in Mexico is aligned with the accreditations process of JCI,

We have to understand that both segments are important

which helps attract people from overseas. The number of

and we cannot overlook the fact the public sector is

foreign patients coming into the country will quickly grow

an important player in this role. Someone that comes

in the near future.

to social security here will talk about the quality of Monterrey’s hospitals. They will help broaden the scope of

Q: Why choose Monterrey over Tijuana in the north or

opportunities that people may have. If you consider that

Cancun in the south?

in Mexico half of the service payments are out-of-pocket,

A: There are several reasons. First of all, you have a city

people will actively search for alternatives.

here that is dedicated to ethical standards in hospitals, which was written in the Declaration of Monterrey 10

Q: Is this rebranding of Monterrey as a health city also

years ago. As part of the cluster, there is the Committee of

being done through the state government?

Ethics, which reviews how well the different institutions are

A: It is supported by the state government and they

working. They are not judging, just trying to build a culture

are part of the cluster. The concept of the cluster is

that provides safety and security for the patient. The

government, academia and industry. So they are involved

technology in Monterrey is always up-to-date. Although

through the Ministries of Economy and Labour, Health

we are in the health business we also are aware of safety

and Tourism. They are trying to support our efforts. Also,

and security, which are not the same thing. Safety is the

we have the involvement of the government through the

well-being of the patient. Security is the well-being of the

hospitals and public sector. Hospital Ángeles for example

person in the city and in the institution.

is a relatively new hospital in the city and it is expanding its infrastructure effectively.

Q: How are you targeting markets other than North America, specifically through the committee of promotion

Q: Where will we see the city in the future? What new

in the cluster? How does that committee promote

projects does the cluster have at hand?

Monterrey’s health services?

A: By the end of 2016, we will be in a similar position but with

A: First we try to understand the needs of the market,

higher numbers of people from Mexico and overseas tended

especially in the US, which is closest to us. But some other

to at our health institutions. You will see a city with more

Latin American citizens choose to receive services here

demanding health-related organizations and academia

because of the equipment we have. The health sector

concerning ethics, transparency, honesty and integrity. We

has entered into the process of globalization and this has

are working a lot on credibility. Last but not least, I hope that

helped place Monterrey on the map. For example, Christus

we will see a government that is understanding, supporting

Health is the holding of Christus Muguerza and they have

and working along with the sector.


| VIEW FROM THE TOP

UROLOGY SPECIALISTS FOR LOCALS AND TOURISTS MARIO ESTRADA Medical Partner of UROSUR

Q: What were the opportunities you foresaw that led you

Q: What new treatments or technological advances are

to open the first integral urology clinic in Merida?

there in urology that put you one step ahead?

A: We wanted to create an environment where patients

A: We use laser technology to break kidney stones, which

with any urology-related problem could find a solution.

is one of the main problems here in Merida. We also now

We made sure we had the infrastructure in place, without

have new surgical reconstructive techniques, which few in

sending people from place to place. Many problems in

the southeast adopt. We are trying to change all the old

urology are multidisciplinary, so we needed many experts

techniques that are now obsolete. People are responding

in the different urologic branches in one place.

to these new techniques, including minimally invasive surgery that did not exist 20 years ago. We also have other

Q: How do you guarantee best practices that meet

new technologies like Urodynamics.

international standards? A: At an administrative level, our clinic has certification.

Q: How do you do think medical tourism will evolve in the

Federally, we are certified by the Certificación de Clínicas de

short and long term?

Atención Primaria y Consulta de Especialidades. All personnel

A: Mexico is a solid destination in which to seek an

is bilingual and we have a national certification given by the

operation, especially for the infrastructure that is present

National Council of Urology, which is structurally linked to

and the city is safe. People may prefer to recuperate by

the American Urological Association (AUA). This ensures

the beach. Also, as our currency has a certain position in

that Mexican urologists also have the latest knowledge, as

comparison with others, prices are attractive to people

would an urologist practicing in the US. We try to stay up to

who come from other countries. They can recuperate very

date with technology and advancements.

well after a first class operation that will guarantee results. I think these are the factors that will increase medical

Q: Who are you joining forces with to educate about

tourism.

prevention? A: One of the associates in UROSUR is the medical

Q: Where will we see the company in 2016-2017?

residencies teaching chief in one of the IMSS hospitals.

A: We are very interested in having an impact on a local

Training residents with a culture of prevention will have

level in Yucatan, Campeche and Quintana Roo. We are

an impact. Another associate is the chief of the Hospital

looking to expand but we are a young company, we are

Regional de Alta Especialidad de Mérida. From that position

still looking and learning. I think in a few years’ time, we

we can launch campaigns. For these campaigns, we can

will develop an even stronger team and more specialized

distribute packets of preventive urology medicine. The

equipment. We are looking to acquire a surgical theater.

government has many projects and plans but I think this is

We will likely remain at the local level with a more

the path to follow. We also cooperate with IMSS and ISSSTE.

advanced clinic, even better services and with the desire to expand our patient reach. We will also explore holding

Q: What makes you different from other multidisciplinary

consultations via video, as we have patients who contact

clinics in the city?

us from states that are far away and from South American

A: I believe we are the first to truly work as a team. If I

countries. We need to find a way to reach these patients.

have a colleague with a greater ability in an area of need,

We have a clip that greatly improves the lives of male

I will work with my colleague for the good of the patient.

patients with incontinence. This is the type of product

We have the medicine needed to ensure there are no

we can help with from a distance by carrying out online

complications. We have a nutritionist who is an expert in

consultations and online sales. We did not design the clip,

lithiasis, a sexual psychologist and a specialist in the pelvic

but we made the necessary contacts to obtain exclusive

floor, among others.

distribution rights in Mexico.

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PIONEERING EYE SURGERY IN "CITY OF SIGHT" ROGELIO VILLARREAL Director General of Centro de Oftalmología Monterrey

274

Q: You were the first surgeon in the world to perform

the future. Mexico’s eyesight health is lagging, resulting

farsightedness laser surgery. How has this helped change

in over 1 million people with poor or nonexistent vision.

the world’s perception of Mexican physicians?

Between 60,000 to 80,000 people join them on a yearly

A: Our Monterrey operations began in 1992. Centro

basis. Monterrey has always had top quality human capital

de Oftalmología Monterrey was the first center where

in the medical field but technological advancements

ocular laser surgery took place for both eyestrain and

were still lacking. Once we secured the latter, the city

farsightedness conditions. Soon after, the city’s research

saw a significant increment of patients. We have received

in laser performance exponentially increased, creating a

multiple patients in our facilities, whether foreign or

booming interest in eyesight correction. Laser precision

domestic. Most international patients come from the US,

far exceeds previous surgical techniques, guaranteeing

considering their closeness and connectivity to the city.

greater success. Thereafter, we continued our efforts

We have seen full charter flights with patients arriving to

in

Monterrey, going back to their country of origin only hours

short

sightedness

and

astigmatism

correction.

Monterrey’s involvement in the ophthalmological laser

after their procedure.

surgery field was so great the city imparted the first courses, gathering surgeons from all over the world. In

Q: What is the price range of eye laser surgical procedures?

addition, we received the support of the industry’s largest

A: This type of surgery has greatly evolved since 1992.

medical device manufacturers, further positioning the

Medical advances happen almost on a daily basis and so

city as a hub for eye care. Multiple ophthalmologists

does the technology that follows. Centro de Oftalmología

have come out of Monterrey, treating patients around

Monterrey is equipped with the latest medical devices,

the world. As a result, the city has positioned itself

which has changed our procedural approach. We now

as the “city of sight”, becoming a pioneer in eyesight

engage in minimally invasive surgery called, allowing us to

correction procedures. We also pioneered the cataract

correct the issue with little damage to the eye structure.

correction field with the implementation of bifocal

Our prices range from US$1,000-4,000 for both eyes,

intraocular lenses.

depending on the condition we are treating. Even though this type of treatment is yet to be certified by the FDA,

Q: How did you foresee the opportunity of implementing

the COFEPRIS has already accredited it. Under these

laser surgery in eye correction?

circumstances, we are attracting greater volumes of

A: Laser surgery can take as little as 20 seconds, contrary

foreign patients.

to the hour-long procedure that traditional methods take. We understood that if we wanted to quickly bring

Q: How have eyesight conditions evolved throughout the

back the eyesight of our population, laser surgery was

years and which ailments affect Mexico’s population the most? A: Society has become more attached to cellphones

“With the help of stem cells,

and computers, which has a greater impact on sight.

we will be able to create

ophthalmologists around the world concur that spending

artificial corneas, eliminating

Even though we lack the scientific proof to allege this, so much time in front of a screen impacts eyesight. This has resulted in an ailment increase, especially in children.

the need to wait for donors”

Scientists in Japan and China have also proven that keeping

Rogelio Villarreal,

impact on eye health. This has led to different teaching

Director General, Centro de Oftalmología Monterrey

models, where stepping outside and seeing nature helps

children in a classroom for long hours can have a serious


reduce nearsightedness rates. Under these circumstances,

to our communities, receiving funding from sponsors.

we are expecting an increase in ophthalmological care. We

I personally assembled a team of ophthalmologists

must also take into consideration society’s life expectancy.

that had the same concerns as I did, bringing the

Since people live longer, older members of society have

latest technology and procedures to marginalized

natural sight regression. For them to become active

communities and making it available to them. We do not

members of society, our farsightedness, cataract and

only treat patients from Nuevo Leon, as families from

eyestrain solutions are crucial.

the whole country come to us, including from Chiapas and Oaxaca.

Q: Centro de Oftalmología Monterrey is working with stem cells to develop advanced solutions in the eye care

Cataract and diabetic retinopathy conditions impact

field. What has resulted from your efforts?

Mexico’s society the most and although we offer

A: We have worked with adult stem cells alongside the

treatments, we mostly focus on educating and creating

University of Monterrey (UDEM) and its re-engineering

a preventive culture. Our most recent study shows a 5

laboratory. These are stem cells with specific applications

percent glaucoma prevalence in people over 40 years

and are directed to the organic tissue where they

of age. It is important to mention that symptomless

originated from. However, adult stem cells can now be

glaucoma, where the eye pressure is not affected, can

programed and used for other purposes. We are looking

strike patients.

to create treatments for eye conditions with no solution. As such, the disease advances to much more complicated We are still in the earliest stages of our research,

stages that need larger investments. With the help of

understanding how to manipulate and direct the cells at

UDEM, Fundación Ojos para México has developed

will. We also want to limit the scope of ailments to treat,

new screening mechanisms for glaucoma and diabetic

concentrating on retinitis pigmentosa (RP), glaucoma

retinopathy. If we can detect the condition in its earliest

and corneal opacities. With the help of stem cells, we

stages, the incurred costs will plummet for patients and

will be able to create artificial corneas, eliminating the

the public healthcare system will benefit from it.

need to wait for donors. Finally, we can also administer stem cells in all laser surgical procedures.

Finally, Fundación Ojos para México has international alliances, expanding its sphere of influence to other

There is a direct correlation between stem cells and

regions in the world. For instance, the Barzilai Medical

the time of recovery from laser surgeries. Nowadays,

Center in Israel and Spain’s Barraquer Ophthalmology

surgery patients can go back to their daily activities

Center have allowed us to further our field of knowledge,

after 24 hours, but the time will be reduced to one hour

understanding ophthalmological conditions that affect

with the use of stem cells. We are yet to define the

the global population.

concise date when our developments will be ready, as some unexpected events arose. For instance, we did not foresee the extent of our investment, which has put a toll on our development times. Be that as it may, we are working to present these solutions to the general public in a four-year timespan. Q: For the time being, the Fundación Ojos para México is one of your biggest projects. What results have you obtained and how is it helping your community? A: Ophthalmologists are becoming more aware of the problems that presently overwhelm Mexican society. There is a large population segment that is unprotected, as the government’s public healthcare system cannot cover them all. We must find alternative means of treatment that can ensure their health. For this reason, the Fundación Ojos para México came to life. We began our project in 2006, treating patients below the poverty line completely free of charge. We are an altruistic organization that wants to bring health back

About 285 million people are visually impaired worldwide. In Mexico, close to 1.3 million inhabitants have some sort of visual

impairment

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| VIEW FROM THE TOP

BRINGING ONCOLOGY EXPERTISE TO CANCUN ALEXIS ACUÑA Director General of Cancun Oncology Center

Q: Why did the company decide to establish its operations

We have built a one-stop shop clinical model for oncology

in Cancun and what were the market conditions that led

patients, following the operational plan of US and

to its establishment?

European cancer care units. All of our patients, regardless

A: Cancun Oncology Center began operations in 2013.

of their initial diagnosis, receive the attention of at least

It is part of the MRC International Oncology Center

three of our specialized oncologists.

Group comprised of US, Mexican and European investors

276

whose approach was to target emerging economies with

Q: How is Cancun Oncology Center helping marginalized

insufficient oncological units. The group has invested

communities receive cancer treatments?

in Cancun and Queretaro in Mexico, as well as in the

A: Cancun has grown exponentially over the last

Dominican Republic. MRC International recognized that

10 years, attracting wealthier communities as time

Mexico and specifically Cancun had a shortage of

passes. The city has an average population of 1 million

oncological services. In the past, regional patients had to

inhabitants. However, the project originated from a

travel to Yucatan, Campeche, Monterrey, or Mexico City to

wider angle, trying to service all socioeconomic spheres.

receive some types of treatment.

The company offers discounts to those in need by conducting socioeconomic studies, coupled with free

High-quality care units with international certifications,

treatments for children through partner foundations.

like Hospital Galenia, also opened their doors making

One of our main purposes is to service all of our patients

for potential partners in the local market. Large volumes

equally, regardless of status or financial capabilities. For

of foreign patients coming to the city added to the

example, we are equipped with the best linear accelerator

attractiveness of Cancun. Even though the oncology field

(LINAC) in Mexico’s southeast region, providing both

is not a focal point in medical tourism, we still attract

radiotherapy and radiosurgery services depending on

demand.

what our patients need.

Q: How is Cancun Oncology Center divided and what

Q: What sets Cancun Oncology Center apart?

services can it offer?

A: As I previously mentioned, our integral solutions set

A: Cancun Oncology Center’s business and medical

us apart from our competitors. In the past, excellent

attention model, as well as its infrastructure, is focused on

oncology practitioners could be found in Cancun but

an interdisciplinary approach that includes radiotherapy,

there was no cohesion in their services. After diagnosis,

chemotherapy and surgical treatments, the three general

patients were normally referred to other states, which

ways to treat cancer. We have two internal oncologists

left a lot of unexploited opportunities in the market and a

who focus on radio and chemotherapy, coupled with an

deficiency in the quality of medical attention. In addition,

affiliate group of oncologists with different specializations.

marginalized communities could rarely make the trip and receive treatment.

“Like fingerprints, each cancer

Like fingerprints, each cancer case is unique. As such,

case is unique. Patients need

patients need multiple specialists to define the best

multiple specialists to define

of Mexican oncologists, Cancun Oncology Center has

the best approach”

physicians. These physicians are leading experts in

Alexis Acuña, Director General of Cancun Oncology Center

approach and type of treatment. Besides the support also created alliances with highly renowned US-based the oncology field, all of which have developed new technology and cancer treatments.


We understand that we can achieve more positive

Q: How is the state government helping Cancun Oncology

outcomes through cooperation. Therefore, we open our

Center achieve its social purpose?

doors to independent oncological practitioners that want

A: We keep open communication channels with the

to use and support their work through our infrastructure.

government at all times. Some of our physicians work in the public sector as well, serving as the government’s on-the-

We treat our patients with affection, personalized care and

field analysts, helping it understand what is happening in

the latest scientific advancements. Similarly, we expect all

the market. Cancun Oncology Center has monthly lectures

our doctors and affiliates to follow suit. Their credentials

on prevention and public institution agents are always

alone are not enough. For us to retain their services,

invited. Cancun Oncology Center also works with private

we must make sure they believe in our philosophy and

charity institutions. In both instances, they help us spread

respond accordingly.

the information. Finally, we are undergoing negotiations with the state government as to subcontract some of our

Q: How is cancer evolving and how has it affected the

services to it.

number of patients you see come through your doors? A: Breast and cervical cancer are affecting female

Q: How much of your business is from medical tourism

populations all over the world, not only in Quintana Roo.

and foreign patients?

Male patients, on the other hand, are affected by lung,

A: On average, 20 percent of our patients come from

prostate and gastric cancer the most. When comparing

abroad. Numbers fluctuate depending on the month, but

these numbers to the US and the rest of the country, similar

that is average. Most of these patients come from Canada

results will follow. Unfortunately, the state government is

and the US. But Hospital Galenia is referring some of

still in the process of creating indicators that will allow us

its Belizean patients, as they created a link-up program

to better understand the situation in Quintana Roo. On

with private national institutions. We also have seen

a positive note, the state’s public healthcare system is

patients from Germany, Italy, Colombia, Venezuela and the

systemically improving its quality, especially in oncology.

Caribbean.

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FERTILITY CLINICS GUARANTEE PATIENT SAFETY JOSÉ GAYTÁN Director General of Fertility Center Cancun

Q: What differentiates you from other clinics?

at the same rate. In the past, families were formed before

A: We are focused on the local population and we opened

the age of 26. The second cause is contraceptives, which

with the intention of attracting local clients and fell into

have given people more sexual freedom. People who do

medical tourism. We are also much bigger. We have 132

not protect themselves are more prone to infections, which

staff members whereas the clinic opposite us has six. The

can affect the genital tract and cause infertility. There are

other clinics have space of around 200m whereas we

other causes, like the chemicals we consume, pollution and

have around 700m2. Almost all of our staff members are

our lifestyles. Testicles have to be at a certain temperature,

bilingual. We are not associated with a hospital, as infertility

which is why they are outside of the body. We spend most

is not a disease as such. We prefer to be independent.

of the day sitting down and our eating habits are not

2

278

the same. There have been developments in ultra-rapid Many profit from the fact that infertility treatment here

freezing in vitro treatments. Before, for every 10 ovules

costs US$6,000 whereas in the US it costs US$16,000-

frozen, nine died. Now, 9.5 unfreeze well.

18,000.

Surrogacy,

which

internationally

can

total

US$60,000-70,000, costs US$120,000-130,000 in the

Q: What does your high rate of success depend on?

US. It is understandable that people come to Mexico as

A: Age is an important factor. The donation of ovules is

they would save around 50 percent on treatment. We also

the most successful treatment with a success rate of 70-

get many European clients with North American visas.

80 percent. This compensates for women aged 39-40 who

It is sometimes difficult to get treatment in Europe and

have in vitro treatment and of which only 25-30 percent

surrogacy is banned in Spain. We also offer a wide range

become pregnant. In vitro treatment for a woman of 28

of services, the most complex of which is monogenic

would result in pregnancy in over 60-65 percent of cases. So

detection. We are now treating an Indian patient whose

on average, for every 10 women we treat, six get pregnant.

daughter has Epidermolysis Bullosa. This is an extremely painful condition in which the skin lacks a certain protein

Around 70 percent of our clients are over 36 and most

and so any rough contact would break the girl’s skin and

visit with their spouse or partner. We did a study in Spain

lead to infection. The client wishes to have another child

that showed a couple with fertility problems waits around

without this gene and so in coordination with Spain and

a year and a half to come to a fertility center. In Mexico, the

Miami we have the embryo ready to transfer without the

average is six to seven years.

affected gene. This treatment can be found in the US and in Europe but it is still difficult in Mexico because there are

Q: What is this long wait due to?

very few cases. We have many mixed race people, which

A: The lack of centers available and the cost, as the

protects against monogenetic diseases.

treatments were extremely expensive. The price has not changed much, and the money it costs was worth a lot

Q: What are the infertility levels in Mexico?

more previously than it is now. In addition, doctors did not

A: Infertility is a special condition that affects people

have the habit of referring people to specialists.

equally, no matter where he or she is from. The percentage of couples with fertility problems is consistently around 14-

Q: How do these services improve the lives of your

16 percent. It is mostly women who suffer from infertility. A

patients?

woman begins to lose her reproductive ability from the age

A: It does not improve peoples’ lives; it completely

of 35, and this accelerates from age 37. From age 42, the

changes them. Couples come after years of failure and

real possibility of having a healthy baby at home is around

are tired, worn-out and angry. People that arrive stressed,

5 percent. Today people wish to focus on their careers

nervous and angry, transform themselves after having

and not on having families but our genes do not evolve

their baby.


| VIEW FROM THE TOP

SHORTENING THE WAIT FOR NEW LIFE MAYRA DE LA GARZA Medical Director of IREGA

Q: What conditions in Cancun drove the opening of a new

treatments, while others might need to undergo a surgical

IREGA clinic?

procedure before they can begin fertility treatments.

A: IREGA’s first clinic opened in Acapulco. Our decision to open a clinic in Cancun was partly a response to specific

The tests we perform help us to be realistic about our

health needs in the region. Around 20 percent of the

patient’s opportunities. It is vital to always tell them the

population in the state is affected by fertility problems.

truth regarding their chances of success. However, we

When we opened in 2011, there were no fertility clinics in

have very high success rates. Our strict quality controls

Quintana Roo. If people needed treatment they had to

help us achieve an 80 percent fertilization rate. Once the

travel to Merida or Mexico City.

eggs are fertilized we wait for embryonic development and we freeze the eggs so that couples can use them in the

Q: How do medical tourism trends impact IREGA’s

following months. Most of our patients are 34 or 35 years

strategy and operations?

old and our in vitro procedures have a success rate of 80

A: Around 30 percent of our patients are medical tourists,

percent. If a couple does not get pregnant after two clinical

which is a very high percentage. When we opened our

attempts they are required to perform follow-up studies

clinic we were focusing on local population but we started

to determine which problems they might be encountering.

receiving requests from people from the US and Canada that were looking for treatment options outside their

Q: What are the reasons behind increasing infertility

countries. Economic reasons and long waiting periods

rates?

are the main elements when people decide to come to

A: Lifestyle and professional goals are prompting young

Cancun. We have received patients from many places

couples to postpone parenthood. This takes a toll on

including Europe, Latin America and Russia, but most of

their ability to become parents. The older women get the

our patients come from the US and Canada. We promote

harder it is for them to get pregnant. After women turn

ourselves using digital media and our webpage acts as

35 years old, their fertility rates begin to decrease and

a communication portal. We also participate in medical

are drastically reduced after the age of 40. But age is not

congresses and events. Part of our service for foreign

the only setback. Pollution, environmental and chemical

patients is a logistics team that helps them get all the

agents and toxic particles are also to be blamed.

information they need for planning their trip and provides transportation for them once they are in Cancun.

A healthy couple has an 8 percent monthly opportunity of getting pregnant naturally. After the age of 35, this

Q: What processes do couples have to go through when

percentage drops to 6 percent and after the age of 40,

they go to an IREGA clinic?

it declines 4 percent more. Age plays an important role.

A: When a couple comes for the first time we ask for their

The success rate for getting pregnant with assisted

clinical history. We study their family background and if they

reproduction techniques is 60 percent but after the age of

have undergone any previous treatment. We look for signs

40 the percentage drops to 15-20 percent. There are two

of diseases that might affect their reproductive ability such

main conditions related to women’s age. As we get older,

as endometriosis, pelvic and inflammatory diseases and

our ovarian reserves and our oocyte quality are reduced

STDs. We assess the uterus and ovaries. All of this is done

and our risks of miscarriage increase, especially after the

in the first visit. Follow-up studies are required to evaluate

age of 40. Men also face fertility problems. There are many

hormones, the uterus cavity and fallopian tubes as well as

factors that decrease sperm production. Being exposed to

a sperm sample, for which we assess its' volume, mobility,

high temperatures is not conducive for sperm production,

morphology and concentration. We have to estimate the

as is smoking and being exposed to pesticides or chemical

course of treatment. Some couples only need stimulation

agents. Men are also affected by age.

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| VIEW FROM THE TOP

FOREIGN BARIATRIC SURGERY DEMAND ON THE RISE ALMA OROZCO Director General of Tijuana Bariatrics

Q: Tijuana Bariatrics has a unique operational structure

evaluation process to decide whether fertility medicine

with its main offices in San Diego. Can you further

is something we want to take part in as demand from

explain the reasons why you opted for this location?

medical tourists is high.

A: Tijuana Bariatrics was registered in the US and it

280

is considered a medical tourism facilitator. We link up

Q: How does Tijuana Bariatrics manage its patient flow?

US and Canada-based patients with Mexican medical

A: Our onsite coordinators are very important, as they

practitioners and we arrange the logistics for their stay.

serve as Tijuana Bariatrics’ initial and final point of

From the moment patients register on our webpage we

contact during the patients’ stay. Part of our patients’

begin to plan their trip and provide prospective patients

success is contingent on their follow-up process, thus

with detailed information of their procedure, services

Tijuana Bariatrics accompanies its patients through

and the physicians who will take care of them. Once

their weight loss journey, monitoring new behaviors

they are informed about our services and the patient

and helping them with their new eating habits and

has made a final decision, we charge an initial deposit

supplement requirements. We send a reminder every

to secure their place in the schedule. It is important to

three months for a year to our patients to recommend

mention that patients coming to Tijuana fly into San

they undergo a checkup. Thereafter, once a year will

Diego, which is a faster, more affordable domestic flight

suffice. We have an onsite doctor and nutritionist

and from then on they are under our watch. We send

in charge of post-operatory care, key factors to the

a driver to pick them up, take them to their hotel and

success of the patient.

the following day they are driven to their pre-operatory checks. Once there, they will meet their medical team,

We see an estimated 100 surgeries each month, which

their nutritionist and all the staff that will be in charge

requires a lot of attention. We have developed and

of their procedure.

implemented a database that automatizes patient care and their consequential attention. Following patient

Q: Considering the specific procedures your patients

registries, systemic information packages are sent to

undergo, how long do they normally stay at your

them, helping us ensure their safety and successful

facilities?

treatment. Our database management system also

A: It depends on the procedure they are interested

includes travel info, pre and post op diet information,

in as we offer a great number of bariatric and plastic

payment information, dates, bank information, medical

surgeries. For instance, when recovering from gastric

tourism policies and patient consent forms. Medical

sleeve surgery patients remain two days in the hospital

tourism insurance policies are an important part of our

and can leave Mexico on the seventh morning. All

operations. In the rare event of a complication, these

gastric bypass surgeries including mini bypass, bypass

policies will cover additional expenses needed by our

and duodenal switch require three days of hospital stay,

patients, according to their coverage, helping patients

leaving on day six. Among them, gastric sleeve surgery

feel more secure being treated abroad.

is the most popular. Nowadays, gastric band surgery is not as frequently demanded due to a lesser success rate

Q: What alliances have allowed you to operate under

than alternative procedures but it is still an option. We

your plan?

also offer revisional procedures to improve on previous

A: Throughout the years, Tijuana Bariatrics has created

bariatric surgery results, which can be a different

multiple alliances. Hotel chains, like the Tijuana Marriott,

procedure to better fit needs. Finally, the company

offer special fees to our clients, improving our prestige

has expanded its procedural scope to take part in the

in customers’ eyes. Hospitals are also a key component

orthodontics and plastic surgery fields. We are in an

for Tijuana Bariatrics. We have collaborated with a newly


established hospital, the CER Hospital. Their top-notch facility ensures success and the peace of mind we need to treat patients from around the world. Rather than only focusing on specialized services, CER is equipped with intensive care units and laboratories, further attracting patients from abroad. CER has given Tijuana Bariatrics a whole floor for its operations and refers all bariatric procedures to the company. We also have the flexibility of having the rest of the facility on hand if we happen to be oversaturated. Q: How has your position in Tijuana helped the

“We have our sights set on the city of Monterrey once again. Its infrastructure and capable professionals have helped it gain the name 'health city' ” Alma Orozco, Director General of Tijuana Bariatrics

company’s overall operations? A: Our proximity to the border has worked in our favor.

patients to find the company that better fits their

Tijuana Bariatrics is positioned on the border in one of the

needs. By categorizing facilitators based on their types

city’s nicest areas. In return, it has helped our logistics,

of services, efforts can be channeled more effectively

travel affordability and connectivity between sites. Even

further strengthening the medical tourism market. We

though our orthodontics facility is not in CER, it is just

can also pinpoint and evaluate a hospital’s and doctors’

around the corner in a state of the art institution with

performance, thus helping them build their international

English-speaking personnel, further improving the way

reputation.

we work. Because most of our patients come from the US,

281

Tijuana-based professionals must speak English, which all

Q: What other markets does Tijuana Bariatrics plan to

of our drivers, onsite coordinators and doctors do.

cover in the near future? A: We have our sights set on the city of Monterrey once

Q: How has the medical tourism sector in Mexico

again. Its infrastructure and capable professionals have

evolved throughout the years?

helped it gain the name “health city”, demonstrating its

A: Mexican physicians are becoming more specialized in

importance for the medical tourism segment. Cancun has

their fields considering that most of their competition

also emerged as a medical tourism paradise pushing us to

comes from US doctors, with the advantage that patients

consider the city as our next destination.

are very cost-conscious. Mexico remains a better choice due to the high-quality services at affordable prices.

The natural economic and demographic landscape of the city makes it ripe for opportunities and we are making

Tijuana Bariatrics, alongside the nation’s health clusters

sure that Tijuana Bariatrics patients are able to take

and the Mexican health authorities, has detected

advantage of these medical travel advantages. Obesity

multiple areas of opportunity. They are looking to include

has increased incredibly globally, making bariatric surgery

facilitators in a regulatory framework to standardize

a determining factor for patients to obtain the quality of

service clusters and categories to make it easier for

life they deserve.


| VIEW FROM THE TOP

HELPING LONGER-LIVING PATIENTS SEE BETTER JOSÉ CLAROS Director General of Videre

Q: How did you obtain so many certifications and what

in Mexico, so we also operate on diabetic retinopathy,

were the circumstances that aided you in this?

cataract and glaucoma.

A: We started in ophthalmology in Mexico City over 20

282

years ago. When I came to Merida, I created the clinic with

Q: What technological advances do you make use of?

the aim of it serving as a highly specialized center where

A: One of our strengths is cataract surgery. Even with the

patients could be truly satisfied. Obviously moving out

highest quality technology and doctors, results depend

of the capital entailed certain consequences because in

on the lens that we use so we must use the most precise

Mexico City, everything was easily accessible whereas in

machine possible. We have just purchased a machine

Merida the lack of a supply chain made it more difficult

that allows us to operate with the highest precision in the

to implement quality. We fought for excellence and in this

calculation of lens size. Every new update to machines

way when inspectors came, we already had the highest

improves results and this keeps us well above the average.

quality equipment and personnel in place and we were able to obtain certifications. We are proud to say we can

Q: What are the reasons for cataract being the most

compete with any national or international center.

common ailment here in Mexico? A: It is because, thankfully, we live longer. There used to be

Q: How has the health system evolved here in Mexico?

hardly any cataract as people died young, at age 45 at the

A: We are pioneers in cataract and refractive surgery,

most. Nowadays, cataract is routine for people aged 75

which is recuperative surgery in older adults who want

and fewer and fewer people want to wear glasses so there

to correct vision impairments that require glasses. Merida

is an increasing number of operations.

has high standards in surgery and we are up to date in the latest advancements in technology and human capital.

Q: How has medical tourism impacted your operations? A: I operate on anyone that comes to me. We started to

Q: What are the specificities of medical tourism?

hear about medical tourism about 5 years ago but for it to

A: More than anything, we work with the idea that

really take off infrastructure such as hotels and transport

everything has to be in English. All of our consent forms are

needs to be in place to receive tourists. Now that more and

in English, all the pre-operation instructions are in English

more companies are working on this, the opportunity is

and the staff speaks English, be it those in the reception,

more appealing. We are in contact with Belize, Canada and

in surgical coordination or those involved in the rest of

the US. Yucatan is an important national center of medical

the trip. Patients should feel that even though they are

tourism and many people come to Merida for health

in Mexico, they understand what is happening and where

services. We are starting to create different packages so

they are. This makes them more comfortable and safe.

that people can come for three days and undergo surgery without having to worry about the details.

Q: What is the most common ophthalmological disease that you treat here in Merida?

Q: What type of alliances have you created, especially in

A: Nationally and even internationally cataract is the most

terms of promoting prevention?

common ailment of eye patients. Nowadays, the most

A: Since our inception, we have always campaigned for

common type of surgery is refractive surgery. A typical

this. One month per year we hold a diabetes month with

patient would be aged around 50, seeking to eliminate

the Mexican Diabetes Association during which we hold

his or her dependence on glasses. I can operate on these

free checkups for diabetics and their families. We are in

patients and restore their short and long sighted vision.

contact with the Yucatan Health Foundation and we hold

For young patients, we often carry out laser treatment and

talks on diabetes with the aim of motivating people to

corneal transplants. There are many people with diabetes

take interest and participate.


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| VIEW FROM THE TOP

A FOCUS ON QUALITY FOR PATIENTS JAVIER FLORES Director of Hospitals and Clinical Services at Hospital San José & Hospital Zambrano Hellion

284

Q: How many surgical procedures do you perform on

Q: What certifications do you currently hold?

foreign patients?

A: Hospital San José has recently undergone an audit

A: We do not perform a great deal of surgical procedures

from Mexico’s General Health Board (CSG). Hospital

on foreign patients, although we attract international

Zambrano Hellion's audit is scheduled for July. We hold

patients, mostly from the US and Canada. The foreign

a JCI certification that we obtained in 2012. For reasons

patients often live or work here but seek treatment under

of safety, the commission did not want to come to Mexico

a foreign address, which is why they are considered

to carry out the evaluation so we had a robot that went

medical tourists. Although we do not look to receive

around the hospital. We are hoping that by December

foreign patients specifically, we do get some.

2017 we will be re-evaluated and gain another certification, either by the JCI or another international organization.

Q: To what extent are you using alliances with doctors abroad to attract foreign patients?

Q: How has the affiliation with Houston Methodist

A: Usually the patients come through a broker, which

increased your patient influx?

mostly originates in the US. Most conditions that we treat

A: The affiliation was set up with the intention of exchanging

here require surgery. The patients plan this ahead and

best practices. This entity is much bigger than us in terms

decide whether to have it done here or in their country of

of patients, space and capital. We both take advantage of

origin. There are also a few cases of trauma, most of which

the exchange of knowledge on diseases and services.

require high levels of specialty. Some begin their treatment here and the follow-ups are performed in their home

Q: What projects do you have in mind for 2016/2017?

country. Often patients could be treated there but they

A: We are focused on highly specialized services. For the

come because they have international medical coverage.

past few years we have declared our intention of focusing on cardiology, oncology and neurology. We will continue

Q: Why do you have this brokerage system with the US

to work on projects of high quality, service and safety for

but not with other countries such as Canada?

the patient. Both hospitals are general hospitals so we still

A: Canada has a public healthcare system, as do some

tend to all ailments. We have a program called CUIDO,

European countries like Denmark. They do not see the

which covers all topics related to the health and safety

need to pay for medical services because they are free.

of a patient. We have all the certifications needed for

It is from countries that require the population to pay for

Hospital San José and Hospital Zambrano Hellion will be

services themselves or to pay for private healthcare that

audited soon. We are getting ready to obtain international

we see the most foreign patients originate from.

certification as a medical center in 2016/2017. We are also working on a cultural transformation project called VIVO,

Q: Why would an international patient choose you over

which aims to improve the patient experience.

another hospital? A: The conditions of our facilities are excellent and many of

Q: Why are your main areas of focus?

our doctors studied abroad in the US and Europe. Patients

A: We have great patient care facilities, research labs and

have confidence in us. Those that come are impressed by

academic links. We want to boost these areas as we are

the quality of our medical services and facilities. Patients

one of the few institutions in Mexico that has those three

imagine a different scenario but they start to feel more

elements. It is part of our vision to help create medical

comfortable once they see our webpage and eventually

professionals the Mexican healthcare system needs.

our facilities. We have testimonies on our website where

We know more than anyone the need for good medical

people have said the reality of treatment here was

professionals. For this we concentrate on quality and

completely different from what they had imagined.

security for the patient and academic training.


| VIEW FROM THE TOP

ONE-STOP SHOP FOR MEDICAL NEEDS RICARDO SEGOVIA General Surgeon of CostaMed

Q: What is the history behind CostaMed?

Caribbean, capable of simultaneously fitting nine people.

A: Before establishing Cozumel’s Medical Center, I was a

Our personnel is extremely qualified, all certified by their

partner and medical member of Clínica Cozumel. Back in

respective medical counsels. CostaMed is the only hospital

1995, Chris Schumacher, who is now my most important

in Cozumel that has been certified and recertified by the

business associate, approached me about new technology

General Health Council.

implementations. Although I was interested in acquiring new and unavailable technology for Cozumel’s market,

Q: What technology implementations has the hospital

there was little to no expansion room in the facility. Partners

undergone?

at Clínica Cozumel had already planned on creating a new

A: The imaging diagnostics division is equipped with

center and machinery would be required. After a year, not

a fourth dimension ultrasound, a 1.5 Tesla MRI and a

only did we not go through with the project but the whole

16-slice CT that will soon transition to a 64-slice CT.

Clínica Cozumel team began dissolving.

Foreign patients demand multiple procedures from us. Plastic surgeries, gastroenterology procedures, cardiac

Under those circumstances, I planned to open Cozumel’s

catheterization and pacemaker placement, among others,

Medical Center, but was lacking some of the initial capital.

top the list. Our capabilities in orthodontics have also

After further discussions with Schumacher, we became

increased the demand for such services. In fact, they are

partners and established our operations in a 900m2

commonly promoted by cruise staff.

piece of land on January 3, 1998. Since then, we have had progressive and sustained growth, now covering 3,800m2

Q: Have you seen more foreign patients coming to

in Cozumel alone. Expansions to Playa del Carmen, Tulum

Cozumel?

and Mahahual followed.

A: The cruise ship industry is Cozumel’s main economic motor, so our operational focus is mainly on this segment.

Q: What market conditions led to its establishment in

Nonetheless, through this scope we can offer top-

Cozumel?

notch medical infrastructure to Cozumel’s 100,000 local

A: My trajectory as Felipe Carrillo Puerto’s Social Security

inhabitants. In the past, people went to other cities to

Director and later as Social Security Director of Cozumel’s

receive medical treatment. Now, they travel to Cozumel,

port, allowed me to clearly assess the healthcare

which includes foreign patients as well. Between 60-70

shortcomings of the island. The system’s evolution in

percent of our admitted patients come from abroad. They

recent years has been quite radical. For instance, treating

now look for our services online and arrange their arrivals

patients with craniocerebral trauma was unthinkable in the

from all corners of the world.

past but it can now be done with our onsite neurosurgeon. Q:

What

alliances

has

CostaMed

developed

with

Q: How have CostaMed’s operations evolved throughout

governmental institutions to promote its services?

time?

A: We developed a medical tourism initiative that

A: We have gone from offering basic medical services to

showcases Cozumel as an important player in healthcare

specialized tertiary care. CostaMed is equipped with the

services in local and international congresses. CostaMed

latest technology. We have one of the best intensive care

is also a member of Quintana Roo’s Medical Tourism

units in the region. We have successfully performed five

Association as one of the region’s main hospitals. We have

open-heart surgeries, the only hospital in Quintana Roo

close contact with the state’s Ministries of Tourism and

to achieve this. CostaMed is a pioneer in gastrointestinal

Health as well as the National Institute of Entrepreneurship

and therapeutic endoscopy. Finally, our Cozumel facility

(INADEM). Medical tourism has been a fundamental

is equipped with the largest hyperbaric chamber in the

initiative for President Enrique Peña Nieto.

285


| VIEW FROM THE TOP

ATTRACTING BUSINESS THROUGH DENTAL TECHNOLOGY JAVIER LORIA Director General and Founder of Dentistar

286

Q: How have your operations evolved since opening?

Q: Where is medical tourism going in the next few years?

A: I started with a consultancy practice and then realized I

A: It will increase. There are more and more people coming

needed a clinic and it has grown from there. I had a problem

to Mexico. I think we will start to see more complex

in that the maker of my prosthesis, dentures and crowns

procedures that require two or three visits a year or a visit

was located in Merida. There were no dental laboratories

every six months. I think that due to the tax and insurance

in Cancun. Patients that come from abroad only come

US doctors pay, they will continue to raise their prices. A

for a week, so in that short time the work needed to be

doctor of my specialty in the US is a millionaire. Here, we

completed in full. Due to this, I decided to invest in opening

belong to the middle-high income bracket. I would like to

my own laboratory to satisfy the needs of my patients. That

see Mexican doctors raise their prices so we can be more

has been running since mid-2011. In addition to covering my

equal with our counterparts in the US. All the material and

own needs, I supply to 10 other orthodontists in the area.

machines I use are imported from the US. I have to pay

Thanks to technology, I can have a product ready in three

tax and it costs me almost double what the material costs

days. Patients want few appointments and a job well done.

over there.

Q: What differentiates you from your competitors?

Q: What pushes medical tourism in Mexico?

A: Primarily, I guarantee my work for life. It is highly unlikely

A: The patient wants good quality or acceptable quality

to break or falter in quality. If something were to happen, I

work at a much lower price. Some are too afraid to come

would repair it at no extra cost to the patient. If it is due to

to Mexico despite the quality and lower price of our

a fault in the patient’s bone that causes the damage to my

work. Little by little, through references of my patients,

work, I also inform the patient. I cannot control their bone

others come.

structure or oral hygiene habits such as tobacco usage. Even so, I have only two lines of dental implants, which are

Q: What certifications do you have that help you win

the best in the world. In some cases, patients know I can

prospective patients' trust?

put in the implants and they can have the work finished in

A: The certifications we can obtain are through the

the US if needed, as the provider gives me support. They

Mexican Dental Association. We attend many classes, talks

replace their products at no cost if they are faulty or have

and forums for which we do not receive any certificates.

a problem.

Any doctor that goes to a class and pays can obtain a piece of paper that certifies he went; it does not mean

Q: What other key alliances do you have that allow you to

he is capable of doing a good job. Sadly, there are many

operate in this way?

cases of work done by certified doctors that did not work.

A: I do not have alliances as such, but if a doctor from

I would like international certifications.

another country has doubts, we speak over the phone. My only alliances are with the suppliers. I do not ally myself

Q: What are your short-term projects?

with companies that come offering discounted products,

A: We are in the middle of a project of making personalized

as I know they do not have the background.

braces with a 3D printer. We are also working on making surgical guides to operate on patients with implants by

Q: What are the treatments that you offer?

feeding data into a radiograph. It is already happening in

A: In orthodontics, we have patients that come for regular

Merida but I want to do it a little differently. My wife is

checkups. Some foreign patients come for braces and

an orthodontist, so we want to buy a machine that does

their local dentists do the follow-up treatments. I get more

both things. Such a machine was only recently launched in

and more patients with no teeth at all who come for a

Chicago this February and it is not yet available for sale.

complete set of implants or veneers.

We hope to have it in a few months.


| VIEW FROM THE TOP

DENTAL TOURISM IN THE RIVIERA MAYA ALEJANDRO LAGUNA Director of Coral Dental Center

Q: What were the reasons that led you to establish your

A: When we first came to Playa del Carmen, we saw the

operations in Playa del Carmen, rather than in Cancun?

growth potential of the market, whereas companies that

A: We are originally from Mexico City. Even though we had

arrived prior to us may have evaluated it as just a small,

significant success in Mexico City, the poor conditions of

fishing town. Under these circumstances, Coral Dental

the city were too much and we were motivated to look

Center significantly invested in its facility, becoming

for better life quality. Playa del Carmen made more sense

a specialized service provider capable of performing

in that regard, rather than Tijuana or another medical

advanced procedures. Our goal has always been to

tourism hub. Our services have been greatly received in

provide the best quality services, without compromising

Playa del Carmen, considering orthodontics are needed

our prices.

regardless of the market segment. Since our arrival 12 years ago, we have created brand loyalty and preference

An important market segment is emergency procedures,

within the community.

where tourists unexpectedly require our services. In that regard, hotels are our key allies, as they know Coral Dental

Q: What is the potential of Playa del Carmen’s market?

Center’s facility will offer the best solution. We always

A: Being a touristic paradise is one of its biggest

follow all federal and clinical requirements, such as having

advantages. The tourism flow throughout the year and

sterilized and clean facilities, and most importantly, our

specifically during the summer is extraordinary and

technological equipment sets us apart.

presents major opportunities for businesses. Patients living in countries with adverse weather come to Playa

Q: Considering medical tourism was the main area of

del Carmen for extended periods of time and they need

opportunity, what percentage of your clientele is foreign?

specialized services during their stay. Even though Cancun

A: Half of our patients come from abroad. This includes

remains the most attractive destination in Quintana Roo,

not only tourists but also foreigners living in the city.

Playa del Carmen is gaining ground and closing in. Coral

Most foreign individuals are retired and their purchasing

Dental Center has received patients from far-off countries

capabilities are superior to the average community

like Germany, China and Australia, among others, as well

member, adding value to the market. Our online platform

as from the US and Canada.

has also secured much business, where patients file previous studies and we assess the procedure to be

Climate conditions and scenery are not the only elements

performed. We need to keep in mind the recovery time

foreign patients factor in while looking for medical

needed so that patients can plan ahead and enjoy what

destinations. Price ranges are equally important. Dental

the city has to offer.

services can be extraordinarily expensive in other markets and Mexico offers great quality of service at affordable

Q: What can be done to further position Mexico and Playa

prices. As such, patients can spend the same amount

del Carmen as a medical tourism hub?

of money to vacation in Mexico and undergo the same

A: Even though the federal government has emphasized

procedure. Medical tourism is already responsible for

the importance of strengthening medical tourism, we need

substantial capital inflows, and although countries like

more governmental support. Los Cabos, for example, has

Costa Rica and Brazil have a slight lead on Mexico, we are

been greatly promoted in the past. The Ministry of Tourism

attracting more patients.

must push more promotion campaigns as private entities like Coral Dental Center would greatly benefit from those

Q: How did Coral Dental Center differentiate itself,

efforts. Mexico has sufficient capabilities to become the

becoming the service provider of preference in Playa del

prime destination for medical tourism in America and

Carmen?

perhaps the world.

287



DOING BUSINESS IN MEXICO & INSURANCE

14

When considering Mexico as an investment destination, its geographical proximity to the US, low costs and stable economy are key. The country also provides easy access to North America, the Caribbean and Central and South America. In 2012, COFEPRIS was recognized as a regulatory agency by the Pan American Health Organization (PAHO) and its strict regulation makes Mexico an ideal place to conduct clinical research trials.

According to the World Bank’s 2015 ranking of countries per GDP, Mexico is in 15th place but it is second in Latin America. Coupled with the country’s open economy and many trade agreements, Mexico is an appealing center for investment.

From legal advisers to business consultants, there is a wealth of firms at the ready to help foreign entrants to the market navigate the Mexican economy and establish successful operations, including manufacturing plants, research facilities and medical practices. This chapter provides an introduction to those who truly understand how to do business in Mexico’s health industry and the expected highlights and growth of the sector.

289


GET THE INSIDE PERSPECTIVE ON MEXICO’S MAIN INDUSTRIES Mexico Business Publishing supports business and political leaders in driving the development of Mexico’s main industries by offering first hand industry intelligence and analysis based on face to face interviews with carefully selected stakeholders. As the independent publisher of comprehensive, high-level annual reviews, our mission is to accelerate the exchange of vital industry information that enables Mexico and its business community to capitalize on emerging opportunities.

www.mexicobusinesspublishing.com


| CHAPTER 14: DOING BUSINESS IN MEXICO & INSURANCE 292

VIEW FROM THE TOP: Angela Spatharou, McKinsey & Company

294

VIEW FROM THE TOP: Jorge Cueto, Deloitte

295

VIEW FROM THE TOP: José Alarcón, PwC

296

VIEW FROM THE TOP: Alejandro Luna, OLIVARES

297

VIEW FROM THE TOP: Christian López, Baker & McKenzie

298

INSIGHT: Justyna Kroplewska, Hays

299

VIEW FROM THE TOP: Moses Dodo, Bupa Global Latin America

300

VIEW FROM THE TOP: Ernesto Algaba, Hogan Lovells BSTL

Alfredo Pineda, Hogan Lovells BSTL

301

INSIGHT: Geraldine Rangel, Healthlinks

302

VIEW FROM THE TOP: Cristina Viruega, TAPVS

303

VIEW FROM THE TOP: Isidro Rodríguez, Entimem

304

VIEW FROM THE TOP: John Mitchell, Heidrick & Struggles

305

VIEW FROM THE TOP: Ignacio Pérez, Heidrick & Struggles

306

VIEW FROM THE TOP: Paul Doulton, Oriundo

306

EXPERT OPINION: Paul Doulton, Oriundo

308

VIEW FROM THE TOP: Dominik Bacher, Bacher Zoppi

309

VIEW FROM THE TOP: Louise Batchelder, SYNELOG MEXICO

310

VIEW FROM THE TOP: Jaime Cervantes, Grupo Vitalmex

311

VIEW FROM THE TOP: Ángel Alonso, VecMedical

291


| VIEW FROM THE TOP

HELPING BUSINESSES WITH BEST PRACTICES ANGELA SPATHAROU Partner at McKinsey & Company, Latam Healthcare Systems and Services Practice

Q: Could you give us a brief history of your Mexican

but we also work extensively within Latin America. Many

operations, how you got to Mexico and what success you

colleagues who lead healthcare programs with Mexican

have had here?

clients often work with clients in Colombia, Brazil, Chile,

A: McKinsey & Company started in Mexico in the '70s.

Costa Rica and the Dominican Republic.

We were one of the first management consulting firms

292

to develop a client base in Mexico City. We now serve

Q: How are you guiding your clients into complying

clients out of Mexico City and Monterrey. McKinsey is

with best practices in Mexico and also how are you

a globally incorporated firm, so we work closely with

collaborating with institutions to create this legal

colleagues internationally including in Spanish-speaking

framework?

Latin America and North America. In Mexico we offer

A: Bringing the best practices within Mexico and

services across different sectors such as energy, financial

internationally to our clients is an intrinsic part of the

services and private equity, consumer goods, healthcare

value we hope to contribute. At the same time, we are

services,

devices,

not a law firm and do not engage on issues around

telecommunications and automotive, among others. We

the legal framework, nor do we provide legal advisory

offer a broad range of functional services like strategy,

services. Our observations in general are that there is

corporate finance, operations, technology and digital

sufficient legislation across the general Mexico system,

sales and marketing.

but there may be lack of clarity in some areas, or a fair

pharmaceuticals

and

medical

amount of process in others. When we work with a client In the early days, we supported pharmaceutical and

in Mexico, we are trying to make sure that there is as

medical devices companies, often large multinationals

much transparency as possible on the legal context and

setting

in

rules applicable, so they can pursue legitimate strategies

strengthening their local strategy and operations, but

within the context of the legal system and contribute to

also Mexican-owned operators, both in pharmaceutical

Mexican society.

up

operations

in

Mexico

or

interested

production and distribution. Q: How are you able to input your opinion and change Our Health Systems and Services practice followed a few

the healthcare system in Mexico?

years ago, initially focusing on strategy and operations.

A: As a company we try to have a positive impact through

In recent years, we have served Mexican health systems

the programs we support directly, working with clients

on issues around service design, financial sustainability,

in different systems. We may also have the opportunity

or developing different models of care for specific patient

to organize conferences where decision-makers come

segments, such as patients suffering from diabetes and

together and discuss priority issues across the system,

other chronic conditions.

expressing their ideas openly. Two years ago we held a conference on chronic disease management where we

We have also helped clients on a variety of programs

brought a select number of industry people together and

in terms of scale and resources. For example, we have

created a forum where system leaders could exchange

supported

ideas on topics of great importance to Mexico.

whole

system

transformation

efforts,

in

which Mexican health systems launch multi-year national programs to increase patient access to services by

One of the areas we are passionate about is care

improving operations. We have also supported individual

innovation. We hope that our work within this area, for

providers on quality improvement, clinician leadership or

example on chronic disease management, may help

the development of academic medical centers. Mexico is

set a precedent creating a dynamic for the system to

part of our McKinsey North American client service group,

introduce more integration across levels of care and


leverage

cutting-edge

technologies

and

advanced

analytics to significantly improve quality of care and

“Over the last few years, we

patient outcomes.

have worked with health

Before I came to Mexico, I worked in the UK and supported

systems in Mexico, helping

clients within the English NHS. One of the topics I worked extensively on was defining a truly integrated care model for chronic disease management. As we know, chronic patients need tailored support to keep symptoms under control and avoid unnecessary complications that may lead to loss of quality of life, dependency and often emergency hospitalizations. Complications do not only affect the individual patient, but also put the health system under enormous strain. Putting an integrated system of care in place means that primary, secondary and tertiary care have a single view of the patient and work in a holistic way to improve his or her health.

them develop their models, improve the business case for investment in services, and put in place the mechanisms that will allow them to care for patients differently” Angela Spatharou, Partner at McKinsey & Company, Latam Healthcare Systems and Services Practice

Over the last few years, we have worked with health systems in Mexico, helping them develop their models,

of care. In a year with more macro-economic pressures,

improve the business case for investment in services and

healthcare leaders are focused on finding ways to extract

put in place the mechanisms that will allow them to care

more value from what they already have, not spending

for patients differently. We know this produces better

further but providing more services.

results and allows for a more sustainable management of care.

Overall the reactions seem more incremental than a “step change” or a major radical shift. In some cases, there

Q: What have you accomplished for the healthcare

may be more renegotiation around older contracts that

system or the health of patients?

are in US dollars because the exchange rate has a strong

A: We have worked with several public healthcare systems

impact. We cannot predict what will happen in the next

and private providers in Mexico and across Latin America.

year or two but we would not be surprised if we see a

Models such as the integrated care model have resulted

more extreme response from organizations than we have

in reductions of clinical complications of around 20-25

seen thus far.

percent, depending on the patient segment. We have also achieved a reduction on cost per patient close to 15

Q: Where are we going to see the company this year, in

percent, an important step for many systems struggling

terms of new projects, new clients and growth?

to provide services sustainably. We have worked with

A: We are continuing to be involved with major Mexican

a number of individual hospitals on operations and

healthcare systems on topics around operational efficiency

performance improvements where we have seen increases

and whole system transformation. We would like to bring

in numbers of patients treated within existing resources

the topics of quality and standardization of services

between 15-20 percent on average. In particular, we have

back to the agenda as well. In addition, we have started

seen through operational “lean” type improvements in

investing across McKinsey and specifically in Mexico in

surgical theaters and better planning of surgical capacity,

advanced analytics and digital, which in our experience is

leading to up to 30-40 percent of additional surgical

key for Mexican systems to unlock growth in some areas

capacity within existing resources. This has significant

and efficiency in others. Many systems struggle with the

impact on patient access to services but also significant

fact that they do not have a consolidated view of their

financial impact on the organizations because they can

own resources, patient outcomes and associated costs.

manage their costs much more sustainably. There are hospitals where leadership cannot cite how Q: Has the Mexican healthcare industry been impacted by

many people they employ. Digitalization and advanced

macro-economic conditions, particularly the exchange

analytics can be powerful tools to help create a distinctive

rate with the dollar? How are institutions responding?

view of what is happening and to aid decision-making

A: In a typical year healthcare leaders often review a

for policymakers and hospital directors alike. We have

broad agenda of topics covering quality improvement,

already built this in other markets and are very excited to

leadership development, productivity and new models

do so also in Mexico.

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| VIEW FROM THE TOP

STEERING THROUGH MEXICO’S HEALTHCARE INVESTMENT ENVIRONMENT JORGE CUETO Lead Partner of the Healthcare Sector at Deloitte

294

Q: What are your plans to consolidate and expand the

Q:

healthcare and life sciences practice in Deloitte?

perspective on efficiency and how is Deloitte supporting

A: Healthcare and life sciences is one of the most

them in this endeavor?

relevant industries for Deloitte’s global operations.

A: There are two different things happening in Mexico.

Today, it is the fastest growing industry for Deloitte in

Firstly, multiple M&A activities in both the pharmaceutical

the US. We are expanding our services and capabilities

and provider spectrum are unfolding, which denotes

in

segments,

the consolidation efforts Mexico’s healthcare system is

including pharmaceutical, bioscience, medical devices

undergoing. Secondly, many players in the healthcare

and healthcare systems. We provide our customers

arena are focusing on its efficiency. Public institutions

with valuable solutions for their local and regional R&D,

are finally beginning to understand the importance of

manufacturing, commercial and operation processes.

indicators, metrics and their performance in comparison

Collaborations

to local and foreign hospital data.

Mexico,

covering

with

multiple

industrial

COFEPRIS

and

third-party

How

are

healthcare

providers

changing

their

authorized units are fundamental to devising effective strategies

for

product

registrations.

Go-to-market

Q: What do you think is necessary to improve technology

strategies also are relevant to our solution portfolio,

adoption in public institutions?

advising companies on how to enter the country with

A: Clinical outcomes not having a direct impact on the

a strong understanding of its economic, fiscal and labor

ROI is a great challenge for healthcare providers. When

issues. We are experts in the industry’s entire value chain

patients go to hospitals, providers get paid regardless of

with an important focus on innovation and technology.

the clinical outcome. As such, there is still some industry resistance to invest in technology, considering the revenue

Q: While there are global trends shaping the industry,

of public institutions does not grow from positive clinical

what would be the regional issues companies have to

outcomes. We expect the tide will change over the next

adapt to be successful?

couple of years. Pay for performance is a way of risk

A: Optimizing healthcare costs is one of the most

sharing, where companies get paid only if expected

important challenges globally and locally. There are

outcomes are reached.

many initiatives taking place in this regard. As such, we advise our customers on developing trends and proper

Q: How can pharmaceutical companies be supported in

ways to implement them. We see many healthcare

attracting direct foreign investment to the country?

systems interested in devising prevention strategies;

A: I think that Mexico has a great opportunity to leverage

nevertheless, effective implementation has not taken

what COFEPRIS achieved in recent years. Nowadays,

place. Instead of focusing on a fix and break model

many states are open to provide incentives to companies

burdening the healthcare system, providers are shifting

in this industry. Moreover, with the certifications and

toward investing significant resources in prevention, self-

recognitions COFEPRIS has earned from WHO and

care and education. Getting these programs properly

PAHO, Mexico is now among the 44 countries with a

implemented remains one of the industry’s biggest

fast track in place. For instance, by performing R&D and

challenges. These efforts will see technology platforms

manufacturing activities in the country, companies will

and industrial clusters playing an important role in the

have access to other regional markets. Firstly, the cost-

system’s development. The economic reality of each

effectiveness of manufacturing activities in Mexico is far

individual country is yet another regional challenge. In

greater than other countries in the region. Establishing

Mexico, 20 percent of the population retains 80 percent

plants in Mexico from the legal and fiscal standpoint is

of the country’s wealth, which has resulted in a strong

also much easier. Secondly, Mexico is close to the US, one

market penetration for generic drugs.

of the biggest markets in the world.


| VIEW FROM THE TOP

STRIKES AND BUDGET CUTS COULD PROVE BENEFICIAL JOSÉ ALARCÓN Partner and Lead Health Services at PwC

Q: Considering the recent dual budget cuts in the

is positive as long as the public sector sees it as a sign

healthcare sector, what challenges do you expect the

for improvement. As for private spending, it is too much

industry will have?

out-of-pocket.

A: You can see it in an optimistic or pessimistic way. Pessimistically, you can say that healthcare is cut and

The public sector does not have the resources to comply

it is frozen, in which the only way to move forward is

with everything and an alternative is to shift to an

with pressure from organized society, the private

innovative public-private partnership, which would lead

sector, or even international organizations from the

us to negotiations with insurance companies. Only 8.2

outside. Optimistically, considering the intellingence of

million people are privately insured, which leaves plenty

our government leaders, such as Mikel Arriola at IMSS

of space for collaboration.

and José Narro, Minister of Health, we may now be more united and integrated. Using an integrated view,

Q: What do you foresee for the furure of Mexican

you can use the pressure originated by the budget

healthcare?

cuts as an opportunity to change things for the better,

A: In the near future, I do not think there will be anything

meaning being more efficient. If politicians and leaders

revolutionary, just evolutionary things to maintain the

in the public sector share this view these cuts can be

status quo and maybe some relevant steps focused

used as leverage for improvement. New models can be

on efficiency on the public sector side. In the private

introduced using public-private cooperation such as

sector, I see a more united voice pushing to have it seen

pay for results, risk-sharing agreements and developing

as a competitiveness tool for the government and the

strategic demand linked to consolidated purchases.

country as a whole, which is the right way to see it, and hopefully driving the big reform in the early years of the

Q: We have seen the beginnings of a universal healthcare

next administration.

reform this year along with doctor strikes. What do you think is the significance of this first step? A: Fortunately, these strikes have not been as broad as in other countries. While they did not have a major impact on our health service provisions they are still not a good sign because it means we could reach a crisis. We should

“Strikes should not be used as a political weapon” José Alarcón, Partner and Lead Health Services at PwC

understand them as a call to action and comprehend that the process from student to practicing physician needs

After the next eight years, I think reform will be

to change. We must tread carefully as strikes should not

implemented and the focus will shift to trying to stabilize

be used as a political weapon. As long as their demands

a united national health system until 2030. Most of this

are focused on genuine improvement of physicians’

will be employed through Public Private Partnerships

quality of life then I think they are positive. On the other

(PPPs) since resources will be scarce on either side of

hand, no matter the amount of strikes we must be careful

the spectrum. Afterwards by 2034, a better healthcare

not to stop changes that must really happen.

system may be a reality with some room for improvement. Another way to view it is in terms of supply and demand.

Q: Are pharmacy doctors an appropriate alternative to

To avoid a crisis, the supply must be increased by being

delayed services in public hospitals?

more efficient and the demand must be lowered with the

A: I think it has been a good alternative for society,

help of innovations. We must get the reform right so the

however, by taking that alternative the population is not

gap between supply and demand does not become a

receiving access to public healthcare as is their right. It

predicament.

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| VIEW FROM THE TOP

MEXICO A KEY STAKEHOLDER IN THE TRANS-PACIFIC PARTNERSHIP ALEJANDRO LUNA Partner at OLIVARES

296

Q: What are the most common administrative violations

into the market. Indeed, Mexico was a leader in these

in industrial property in the life sciences industry and how

discussions on this highly debated topic which led to the

does the Trans-Pacific Partnership (TPP) aim to regulate

inclusion of a transitional period for Mexico before being

them and strengthen the intellectual property system in

obliged to adopt the obligations of TPP. My opinion is that

Mexico?

such a transitional period was not necessary and in the

A: Nowadays, the most common violation to intellectual

case of data protection for example, it will only delay the

property (IP) rights is the infringement of patents.

fulfillment of Mexico's obligations which are now Mexican

Patent linkage has reduced patent infringement for

court orders based on other international treaties such as

pharmaceuticals but it only prevents the infringement of

NAFTA and TRIPS.

compound patents. Other patents within the life sciences industry either do not fall under patent linkage regulation

Q: Some stakeholders argue the TPP would limit the

or are disregarded by the corresponding authorities. The

entry of up to 5,000 generic medicines in the next five

claims may be unjustified and thus disregarded by the

years; yet some others believe it will bring further foreign

Mexican Patent Office and COFEPRIS, or they may be

direct investment to the pharmaceutical industry. Will the

prevented from patent linkage to avoid the granting of

TPP help improve the perception of Mexico among other

marketing authorizations in violation of these patents.

countries regarding support and protection of innovation?

There is no reason to exclude medical patents from the

A: There is no basis to say TPP obligations alone would

linkage regulation but the authorities do.

hinder the entrance of generics to the Mexican market. Statistics show penetration of generic products in the

The TPP includes certain obligations: country members

Mexican market is growing year on year and this trend is

should accept as patentable subject matter the new uses

not going to be changed by the TPP, as indeed there is

of known products to avoid in all aspects the discrimination

nothing in the TPP that would ban the entrance of generic

of these patents, including patent linkage. The TPP will

pharmaceutical products. The various legal instruments

also clarify data exclusivity for biologic products.

in place in Mexico are only recognized or clarified in the TPP, for example patent linkage, data package exclusivity

Q: It has been said that Mikel Arriola, Commissioner of

for new molecules and second-use patents is a matter

COFEPRIS at that time, negotiated a balanced agreement

within the Mexican office. The few new matters contained

for the Mexican industry, protecting both the innovative

within the TPP such as data exclusivity for biologics

and the generics’ industry. To what extent do you agree

and compensation of patent terms are not bans to the

with this perception?

entry of generics, only the necessary recognition of a

A: Due to my participation in the so-called “cuarto de

longer period of protection for biologic products, which

junto” I witnessed Mikel Arriola and the Mexican delegation

is recognized by generic companies when requesting a

defending and looking for better conditions on behalf of

Roche-Bolar exception of eight years for bio-comparable

the country. It is no secret the IP Chapter in TPP, specifically

products.

the issues related to pharmaceutical patents and data package exclusivity, were highly debated during the

In general terms, the TPP will provide a higher degree

negotiations, precisely due to the irreconcilable position

of certainty for investment in Mexico compared with the

of some generics companies which pushed against the

current legal framework in various aspects of IP. I am

measures to protect innovation. Mexican negotiators

convinced proper and effective protection of IP is a driver

addressed these conflicting interests by trying to reconcile

for innovation. In the life sciences sector, the opportunities

them and establish a balance between the need to protect

and expectations of the TPP on IP protection were higher

and promote innovation with the need to launch products

than the final result.


| VIEW FROM THE TOP

INTEGRAL LEGAL SOLUTIONS FOR HEALTHCARE INNOVATION CHRISTIAN LÓPEZ PhD, Partner and Head of Pharmaceutical & Life Sciences at Baker & McKenzie

Q: You have mentioned that Baker & McKenzie is Mexico's

Q: In which way do evolving regulations impact your

largest and most advanced regulatory practice. How have

client’s operations?

you retained that position in an extremely competitive

Let us take a look at medical products. By official

field?

accounts, the area that has gone through more profound

B&M keeps generating synergies between our different

regulatory changes in recent years has been the sector of

groups of practice, finding new opportunities to integrate

medical devices. Not only were new provisions developed

health regulation to previously unconnected areas, which

(e.g. techno-vigilance rules), but also old provisions were

has resulted in value-added services for the life sciences

completely revised and resulted in a deregulation and

industry. For instance, we integrated regulatory work with

simplification of the approval process of these products.

privacy law and information technologies, resulting in our

Moreover, international recognition plans were agreed

Digital Healthcare Initiative, which places us well ahead in

with other countries, which has not only expedited the

the market of legal services, particularly for our clients in

approval in Mexico of products already authorized by

the medical devices sector. Likewise, we have increased

other foreign regulators, but has also made it possible for

the integration of our regulatory and litigation capabilities,

approvals obtained in Mexico to be recognized in other

winning several cases against regulatory decisions for our

countries.

clients in the pharmaceutical sector. Q: How does Baker & McKenzie help its clients stay ahead Q: How is the firm’s internationalization and understanding

of the herd in a growingly competitive environment?

of global markets reflected in its client’s operations?

We have designed legal strategies to manage the

Our global view and regional experience has been

regulatory, antitrust and compliance implications of

appreciated by our clients. One visible indicator is that

Patient Support Programs. Companies in the life sciences

we have increased the number of Latam-wide projects.

industries are moving away from a product-only business

For instance, we are implementing a regional project to

model and moving into a more product-plus-service model,

develop compliance policies for every country in Latam

which is making a reality today what others expected to

where a pharmaceutical client has a presence. We are

take place in the future. Also, we are constantly preparing

also executing, for a global cosmetics company, a regional

specialized content and reports in the Life Sciences sector,

mapping exercise of individual countries, aimed at

which is made available to our clients in new ways. The

identifying available mechanisms to accelerate access to

best example of this is our recently launched mobile app,

the whole regional market. We are also helping a pharma

called MapApp, which puts key legal content literally at

client create a mobile app to generate information about

the fingertips of our clients. This covers every country

regulatory developments in Latam in the area of biosimilars.

where we operate and more.

Q: How does Baker & McKenzie ensure its involvement

Q: How can we improve the legal environment of Mexico,

through the whole life cycle of a drug or medical device?

making it more attractive and desirable for foreign

What does this mean to the company and its clients?

enterprises to set-up-shop in the country?

Being a full-services law firm gives B&M a privileged

For many years several regulators in Mexico were

position to assist during the whole life cycle of regulated

accustomed to the fact that their main decisions were

products. For example, we are currently developing a

not regularly challenged in courts. This has slowed down

Licensing & Regulatory Initiative for Drugs in Latam, which

the emergence of legal precedents that are much needed

integrates the different regulatory, intellectual property

in several aspects. This is unfortunate since being able

and corporate law aspects that derive from technology

to challenge decisions is a crucial component towards

transfer projects and M&A transactions.

achieving a true and effective rule of law.

297


| INSIGHT

MEXICO UNEVEN ON TALENT SUPPLY AND DEMAND As for the brain drain trend that Mexico has seen with

JUSTYNA KROPLEWSKA

scientists leaving the country seeking better opportunities,

Head of Life Sciences and

still relatively limited in Mexico. “It is a shame to lose the

Human Resources at Hays

talent we have in the country because we are not ready to

Kroplewska affirms that opportunities in this arena are

offer solid career development options,” she says. “While we support exchange programs, it is also important to Talent management is undoubtedly crucial to business

retain Mexican talent in Mexico.” Hays has a global reach

strategy and firms are not only defined by their products,

while looking for specific profiles and its huge professional

services, corporate strategy and prestige but by the people

database includes Mexicans living abroad who might be

who are actually making decisions, contacting customers

interested in returning to the country to continue with

and running the business on a daily basis. “Companies

their career path.

are not fully dedicated to finding the right talent so most

298

of our clients reach out to us when they need to find the

Kroplewska considers the most important part of her job is

most qualified candidate at a given time or under certain

finding the right match between companies and candidates,

circumstances,” explains Justyna Kroplewska, Head of Life

which can be challenging. Although the human resource

Sciences and Human Resources at Hays. In today’s ever-

firm provides services for many multinational companies

changing and complicated landscape in the healthcare and

operating in the same sector in reality they have different

life sciences industry understanding client needs is a must,

values, policies and procedures. Before an employee

which is why Hays has a division completely dedicated to

requirement even arises the values, core activities and

this sector. The life sciences division has been one of Hays'

future plans of the company must be deeply understood

most important ones since it started operations in Mexico

because these differences will determine if a candidate will

City in 2001. “We are aiming to invest more in this area and

fit with a certain ethos and vice versa. “At Hays we believe

become more specialized to provide the best recruitment

the right job can transform a person’s life and the right

consulting services for companies,” says Kroplewska.

person can transform a business,” she states.

In collaboration with Oxford Economics, Hays releases a

Employee turnaround issues are not unique to the

publication called Hays Global Skill Index annually, which

pharmaceutical industry but they actually are a global

presents a ranking that evaluates the supply and demand

phenomenon across many sectors. Kroplewska observes that

for talent at a global level. According to Kroplewska,

commercial positions rotate the most in the pharmaceutical

Mexico presents uneven levels of supply and demand

and medical devices industries. People are continuously

when it comes to human capital, which results in significant

looking for different challenges. “Gone are the days when

difficulties when looking for specialized talent. “The only

people stayed in a company for 10, 20, or 30 years,” she

thing companies can do is focus on retaining talent

explains. “Today, we see a lot of movement every two, three,

through several human resources management strategies,

or four years.”. When candidates cannot find new challenges

such as offering global mobility, international exposure,

in the companies they are working at they start looking

training and development and attractive compensation

for opportunities outside. For Kroplewska, this has both

packages,” she adds. Companies in the life sciences

advantages and disadvantages since companies actually

industry are looking for a different skillset than before.

spend considerable amounts of resources in training and

As explained in the Labor Market Analysis conducted by

developing staff and when talent leaves, businesses suffer

Hays, pharmaceutical companies used to focus on hard

from knowledge gaps. However, a company would certainly

skills, technical knowledge and educational background

lack innovation should it retain the same personnel for 20

but today soft skills are more relevant. “Communication,

years. She believes receiving talent from other companies

leadership and talent management abilities are more

can be enriching because people incorporate best practices

important as managers need to cultivate teams and not

and values from previous experiences. Yet, having a high

having this particular skillset makes failure more likely

turnaround in a short period of time could be damaging for

within the organization,” says Kroplewska. She believes

sales positions because the sales cycle requires people to

the government should foster exchange programs so that

stay for a set time to create a strategic plan, implement and

professionals can enrich their experience.

obtain the return on investment.


| VIEW FROM THE TOP

HEALTHCARE FOR GLOBAL BUSINESS TRAVELERS MOSES DODO General Manager of Bupa Global Latin America

Q: To what extent are your Mexican customers looking for

programs, corporate insurance is also a solid benefit for

a product with specific features?

employees and has proven to be successful in retaining

A: We are present in 190 countries and we have found the

talent. Replication of healthcare coverage is also a common

profile of our customers is similar regardless of geographic

issue in the region and this has been addressed by several

location. We target clients who have a need for international

countries such as Brazil, where the public system can

coverage, such as frequent travelers and those whose

actually charge private insurance companies. Retirement

lifestyle transcends country borders. Customers might

is also a concern for both private insurance companies

need this for different reasons, for instance expatriates

and public institutions, because people are living longer

seek coverage in both their host and home countries. Non-

and healthcare providers should be ready to face this

expat customers want to have the peace of mind of access

colossal challenge, especially considering that many

to medical care and treatments elsewhere in case of serious

public institutions have not modernized their processes

health problems and this is important for people living in

and operations in decades. When these institutions were

countries where high-quality healthcare services are scarce.

created in the '40s and '50s life expectancy was 50 years.

In addition, there is a global wave of medical tourism. After

Retirement age was 45 years. Today, life expectancy is

10 years of having a direct presence in Mexico, we now have

between 75 and 80 years depending on the country and

30,000 customers and the potential is probably 200,000

people are still productive at the age of 65. Prevention is

to 300,000. Mexico was the first country in Latin America

vital for both individuals and governments. Every dollar

where we launched this suite of global health plans after

we invest in prevention represents three dollars saved in

conducting thorough market research showing that the

the long term.

behavior of our customers in Mexico does not differ from that of our Chinese or American customers. Frequent

Q: What are the factors contributing to the rise of medical

travelers and international citizens do not want to be told

insurance costs?

where to obtain treatment.

A: As people age, their risk of becoming ill increases and we are one of the few companies in Mexico willing to

Q: How important is corporate insurance for your

provide insurance for people up to 75 years old. Population

commercial strategy?

aging is extremely important today. It has been said the

A: We do not approach large companies to offer them

first person who will live 150 years has already been born.

insurance for their employees because we do not offer

While increasing life expectancy is highly desirable, it

quantity, but a product richer in benefits and with

certainly represents a burden for the healthcare budget.

international coverage. Medical insurance is one of the

Thirty years ago, people used to die from factors such as

key benefits that employees seek and can receive while

infections, accidents, or heart attacks, but such events are

working in a company and this is true in a global context,

now controlled and life expectancy is prolonged. A stage-

although the spectrum of needs among employees is

four cancer patient can survive three or five years today,

relatively broad. Some positions require an excellent

but medical care has a cost.

local coverage as a risk management measure, while top positions need comprehensive international coverage if

Q: What are your priorities in Mexico?

they are frequent travelers.

A: We are re-launching our travel product in Mexico, which is a very attractive option for those seeking international

Q: What should be done in order to increase the number

protection. Customers can buy it online or with distributors

of people with private insurance in the country?

and customize it. It is also convenient for corporate

A: Corporate insurance is driving the growth of the private

agencies, which can buy a thousand days and cover their

insurance market in Mexico. With the rise of wellness

employees when they travel.

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| VIEW FROM THE TOP

NEW RULES TO BRING INVESTMENT TO MEXICO registrations being granted to someone else despite the Ernesto Algaba Partner and Head of Life Sciences at Hogan Lovells BSTL

Alfredo Pineda Senior Associate for Intellectual Property at Hogan Lovells BSTL

product or technology being patented, as well as public complaints over third party conducts that may constitute a health risk for the population. This may include the import and/or commercialization of counterfeit products

Q: How has the evolution of the pharmaceutical legal and

subject to health regulations.

regulatory framework in Mexico contributed to improve

300

the country’s global competitive position?

Q: How will TPP impact the Mexican pharmaceutical

EA: Regulatory improvements have made Mexico an

market and when can we expect companies to adopt the

attractive investment destination for the pharmaceutical

new regulations it encloses?

and health industry. Significant changes in COFEPRIS’

EA: Due to the relevance of the agreement, we believe

administration, its international certification by the PAHO

the legislative pathways should be accelerated. Given

and recognition by WHO as a Functional Regulatory

enhanced

Agency have aided this. The international recognition of

opposition from the generics industry is expected, thus

certain Mexican drug registrations and the removal of

resulting in delays. TPP would allow its members to grant

regulatory barriers for market entry have pegged the local

a sui generis protection term in addition to the patent

industry as a highly competitive and sophisticated engine.

term to compensate innovators for the non-justified

The new health environment in Mexico encompasses the

delays derived from the health registration grant. In our

population’s access to innovative health products due to

perspective, the aforementioned provision may have a

the Agreement for the Promotion of Innovation and the

positive impact on improving COFEPRIS’ proceedings

Recognition of GMPs Certification, as well as the successful

related to health authorizations and registrations.

timelines

for

data

protection,

a

strong

harmonization and cooperation of COFEPRIS with other leading sanitary agencies, such as the FDA, Health Canada

Q: What does stronger protection of clinical data

and the Japanese regulatory body through Equivalence

represent for both innovative and generic companies?

Agreements.

AP: Extended protection of medical data will result in effective protection of exclusivity rights and data related

Q: How can Hogan Lovells BSTL support healthcare

to patents. Currently, exclusivity rights and data protection

companies in devising strategies and solving legal issues?

terms are affected by delays in patent prosecution and

EA: Scientific and regulatory developments, significant

examinations and in health registration proceedings

changes in the business models of our clients and increased

derived from different reasons including the authority’s

competition within the market are driving the demand

workload.

for strategic legal advice. We represent and provide regulatory advice for several transnational healthcare

Extended data protection may also have a positive impact

companies including pharmaceutical, medical devices and

on R&D investment, but biopharmaceutical manufacturers

biotechnology research projects, where we have acquired

are still uncertain about the final provisions, while

high specialization. Our services include legal assistance in

biosimilars producers might be reluctant to adapt to the

planning and conducting R&D projects related to business

new dispositions. We have to wait for the final protection

strategy. This comprises launching new products, adapting

terms in order to better assess these provisions and their

to

benefits and incentives for the development of biologics.

sophisticated

regulatory

structures,

restructuring

business operations, research projects involving stem cells and advanced technology applications, training programs

Q: What strategies is Hogan Lovells BSTL implementing

and highly specialized compliance matters. Hogan Lovells

to attract foreign and local clients?

BSTL also advises on litigation.

EA: Hogan Lovells BSTL was recently recognized as the fifth most renowned legal firm in the world. Expansion

AP: Litigation could go from an administrative matter to

of our operations and attracting more customers will

federal court. The most common services we render in this

come through integrating our services and a greater

area are related to linkage system conflicts, such as health

collaboration between our 47 global offices.


| INSIGHT

ADDED VALUE DRIVES TALENT ATTRACTION Mexico is among an elite group of countries in Latin America that continues growing in the midst of tough global finances. The country scores 60.6 in BMI’s Pharmaceutical

GERALDINE RANGEL

and Healthcare Risk/Reward Rating (RRR), making it the

Director General

fourth most attractive market in the Americas. This also

of Healthlinks

means the industry’s business and regulatory environment is stable, which along with robust patent protection and the removal of plant registration requirements, has

Biopharmaceutical companies are focusing on high specialty

enabled companies to commercialize drugs without

drugs. Rangel believes that marketing and promotion teams

having a manufacturing site in the country. All important

should undertake pharmacoeconomic studies to prove the

reasons for foreign companies to invest in Mexico but

efficiency of the drugs. They should have conversations with

success will only come with appropriate strategy. “Global

decision makers in which they can discuss the benefits for

executives are often extremely passionate about entering

patients and institutions such as savings, patient health and

Mexico as a first step to expanding their presence in Latin

minimal side effects. “It is important that companies develop

America,” explains Geraldine Rangel, General Manager of

reduced cost strategies aiming to save in manufacturing,

Healthlinks. “But to avoid stumbling, knowledge on doing

import and licensing and maximizing their resources,”

business in the country is essential.”

Rangel says. She advises local companies to find further competitive advantages and added value they bring to the

The main hurdles are not regulatory anymore since

Mexican healthcare sector.

COFEPRIS decided to speed the drug registration process. According to Rangel, companies now face the

Digital marketing is now playing an essential role in

challenge of understanding the tax system and building

delivering the right message in the right way. “We have

a corporate strategy that will help them gain access to

been discussing this with pharmaceutical companies for

the public markets. Evaluating the regulatory, pricing,

years,” says Rangel. “Just last year, companies started using

promotion and distribution aspects of a given product is

social media and digital marketing to connect to the final

important to decide whether or not to enter the market

customer especially for OTC products.” Social media can

before companies invest or spend valuable time and

also be exploited to better inform patients about therapy

resources. “If the company decides to enter the market we

or treatment. At Healthlinks, it is widely known that chronic

will help them build sustainable commercial platforms,”

patients use many digital tools and social media platforms

says Rangel. “The process starts by defining the staff

to connect to other people suffering from the same

profile we are seeking, then engaging in a strategic

condition. “We are in an era of better-informed patients and

recruiting process, training and monitoring closely their

the second opinion usually comes from Dr. Google,” she

performance in the field.”

adds. As for orphan drugs, digital platforms are a great way of finding patients always ensuring compliance with local

Companies should think about value proposition, including

and international regulations. The health industry is starting

product differentiation and a unique team of passionate

to use new tools to find loyal and detractor users based

people wanting to learn about the market and quickly

on what people post on the Internet, which is not new

adapting to their new surroundings. “The ability to hire

for other industries. “Pharmaceutical and biotechnology

and retain talent is a significant challenge for companies

companies should incorporate more of these digitally

today,” says Rangel. Healthlinks helps its clients by

focused marketing strategies,” she concluded.

building a high-performing marketing and sales team and in renewing their product portfolio so they can focus on future development plans. Recruiting and managing talent includes having a strong sales force, presence in the right territory, effective communication strategies among the team, setting and achieving sales goals and ensuring proper medical support for the team. Rangel claims these are all key factors for developing sustainable strategies aimed at increasing the company’s market share.

“Digital marketing is now playing an essential role in delivering the right message in the right way” Geraldine Rangel, Director General of Healthlinks

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| VIEW FROM THE TOP

LEADING THE WAY IN THIRD-PARTY REGULATION CRISTINA VIRUEGA Director General of TAPVS

302

Q: How has the company advanced in its certification

Q: What trends has TAPVS detected in the pharma sector?

processes since 2015?

A: We see a definite trend toward generic solutions.

A: After completing the authorization process with

Many patents became public in 2016 and we expect

COFEPRIS we focused on getting biotechnological,

more to expire in the following year. However, we also

vitamin and herbal products certification. It was a complex

see many new molecules coming into the country.

process and the commission was mindful of every

It is not widely known the national sector is investing

detail when testing our processes. As we are certified

considerably in new research. It is true that Big Pharma

in biotechnological products the first new molecules

is registering trends related to a drop in clinical studies,

have already been authorized via a pre-review process

but Mexico has all the necessary advantages to become

through TAPVS. The sector is increasingly moving toward

an international standard in this area. We have the right

biotechnological medicines and TAPVS is becoming a key

infrastructure, we have qualified doctors and we have a

partner in the process.

considerable genetic diversity, particularly in the north of the country.

Q: How have COFEPRIS’ latest changes in regulation affected TAPVS’ operations?

Q: What has been TAPVS’ development in the domestic

A: We always adapt to COFEPRIS’ standards and we have

market over the last few years?

seen many positive changes. The new regulations establish

A: We have maintained constant double-digit growth

a post-commercialization approach that forces companies

rates and although we previously reported rates of 40-

to really think about the inherent sanitary risks of any

50 percent we are now consolidating at 10-13 percent

product. As a result, there is a significant improvement

margins. We are not worried about this and we have always

in pre-commercialization norms leading to pharma and

considered competition as our best ally. We are now

technical vigilance. The government focuses on tracking

reinventing our business to adopt more advanced IT tools,

the behavior of the product once it reaches the market,

methodizing ruling processes, standardizing revisions and

more in line with how the international sector works.

making our operations far more efficient. This has also been a major advantage for our clients, since they know

Q: How could COFEPRIS incentivize further investment in

exactly what we need to follow up on their registrations.

projects similar to TAPVS’?

Through our Workflow platform, COFEPRIS can supervise

A: The vision of COFEPRIS’ new head, Julio Sánchez,

all our activities so there is no way we can make any

follows Mikel Arriola’s previous strategy to protect

mistakes. We have already implemented this solution. This

people from any sanitary risks, while taking into

is an excellent alternative in terms of sustainability as well,

consideration

since we can store all information digitally and delete it

the

economic

implications

for

all

players regulated by the commission. Making vigilance

once we do not need it anymore.

processes much more assertive and establishing clear regulations incentivizes newcomers to consider Mexico

We have even worked on specific ruling guidelines we

as an investment destination. Furthermore, it pushes

expect will help revolutionize the regulation process in

these companies to not only seek strategic partners but

the country. Furthermore, considering the benefits it has

also bring their full operations to the country. One of

brought to the pharma market, certification outsourcing

TAPVS’ main drivers has always been customer service

can be an excellent solution for other industries as long

and focusing on clarity and time efficiency so our

as the government establishes the proper regulation. The

clients can get their marketing authorizations as soon

oil and gas sector has already taken advantage of this

as possible. In the end, COFEPRIS’ trust makes our job

solution and the country is now looking to integrate this

much easier.

system in the industrial patent registration process.


| VIEW FROM THE TOP

CUTTING THROUGH PAPERWORK TO REACH THE MARKET ISIDRO RODRÍGUEZ Director General of Entimem

Q: In recent years the role of authorized third parties has

Q: What are the main services you provide and what is

been growing strongly in the Mexican healthcare sector.

the added value of the services provided by Entimem?

What specific needs do authorized third parties address?

A: We started working exclusively with medical devices.

A: In 2010, COFEPRIS announced the creation of third party

Afterward, we expanded to incorporate drugs, both in

authorized units for the pre-approval of medicines and

registration and modification of registries. At this point,

medical devices. COFEPRIS decided to create these units

there are 20 third party authorized units and all of them

taking into account the large backlog of registries they had

are able to do the same activities. To differentiate ourselves

at the time alongside new registrations. By law, COFEPRIS

we offer value-added services including our Solution

has to answer every submission. In some cases the products

Ecosystem which encompasses all services we provide to

are easily authorized, but much more information is required.

help companies to register their products in Mexico with

As COFEPRIS previously had to closely follow the entire

a network of companies that provide complementary

approval process and thoroughly review all the information,

services in the health industry such as translations, legal

granting approvals or rejections was a highly time-consuming

consulting, imports and distribution.

process. COFEPRIS gave third party authorized units the responsibility to ensure all information submitted is accurate

Q: What new services are you planning in the near future?

and correct, saving COFEPRIS´ time. COFEPRIS always has

A: We plan to expand our services to other areas of the

the final decision on every registration, since it has a large

economy, for example to provide certification for drivers,

responsibility in regulating medical devices and medicines

electric devices, biotechnology drugs, pesticides food

and we are held accountable if a product validated by us has

manufacturers and restaurants. COFEPRIS is also planning

negative health consequences.

to allow third party authorized units to regulate vaccines, which is a very interesting and challenging area as it

Q: What strategies have you used to position the company

requires working with the WHO.

in the Mexican market? A: We began by searching for companies needing to submit registrations in Mexico. The first step was to gain their trust, convince them that we have all the expertise they require and that we will not waste their time with unnecessary paperwork. As a third party, the most

“There is no room for error in healthcare” Isidro Rodríguez, CEO of Entimem

important thing we handle is our clients’ trust. Q: What strategies is Entimem implementing to attract Third party authorized units seem like a strange concept to

foreign and local clients?

foreign and local companies because they are usually not

A: At this point several companies around the world

aware that these are fully authorized by COFEPRIS. We

are under the impression that regulations in Mexico are

often have to explain to our clients that we are authorized

overly complicated, so our goal is to bring more foreign

by the council and the concept of third party authorized

companies. Next week, for example, we will go to

units is not new since it has already been utilized for other

Colombia to promote our services, as many companies

industries. The council applied this concept to medicines

in that country want to import to Mexico but they are

and medical devices, which was perceived as risky as it

unaware of the proper procedures. More companies, both

involved large responsibilities on public health. However

from Mexico and the rest of the world, are seeing Mexico

the system has worked correctly and we are able to

as a strategic country to enter the rest of Latin America,

provide the necessary drugs and medical devices much

and for that reason there are increasingly more registries

faster to the Mexican population.

for medical devices and medicines.

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| VIEW FROM THE TOP

HUMAN CAPITAL KEY TO GLOBAL COMPETITIVENESS JOHN MITCHELL Managing Partner of the Healthcare and Life Sciences Practice at Heidrick & Struggles

Q: How is the healthcare practice in Mexico different from

the local and global market. In Mexico there is a positive

your previous global experience?

attitude for the healthcare market especially after the

A: Our colleagues in Mexico tend to be more generalist,

growth of generics. Nowadays, Big Pharma is launching

enabling them to work across different practices. Even

considerably less innovative products and what we are

though they may not be as focused on healthcare and life

seeing from them is an increase in the number of mergers

sciences, they can work in consumer or industrial areas,

and acquisitions.

as the vast market size inhibits them from focusing on a

304

single specialization area. Notwithstanding, this type of

Q: How are you addressing the need for human capital and

behavior varies around the globe. For instance, in the US

the development of Mexican talent?

and certain European markets, in-depth specialization

A: Big Pharma used to bet on Mexican-bred leadership to

is the norm. The Mexican healthcare market is quite

oversee local operations and companies had a really strong

different from the rest of the world. In the past, foreign

Mexican leadership. Now, leadership comes from other parts

companies entered the country to manufacture their

of the world. However, what we are looking for in terms of

products, as the country offered high-quality standards at

quality and talent does not differ. We are looking for leaders,

competitive costs. In addition, Mexico’s strategic location

people who can inspire, who are culturally adaptable and

made manufacturing activities for specialty products and

who have strong experience and a proven track record of

generics much more appealing.

success. We are also looking for a flexible workforce.

“It is necessary to establish a

It is necessary to embrace diversity and be clear about

zero tolerance policy for

sector it is necessary to closely scrutinize safety and to

non-compliance”

which may be expensive and difficult to navigate. Thus, it is

John Mitchell, Managing Partner of the Healthcare and Life Sciences Practice at Heidrick & Struggles

business objectives, values and ethics. In the pharmaceutical ensure compliance with the entire regulatory environment, necessary to establish compliance policies and methods and to ensure that employees understand and follow them. The pharmaceutical industry handles products which deal with life and death.

Q: What are Mexico’s strong suits in the healthcare industry? A: Mexico’s talent pool is highly fluid, as people frequently

Q: Taking into account that Millennials are shaping their

explore

work environment, how should pharmaceutical companies

the

professionals

marketplace. to

acquire

This

allows

on-the-field

healthcare

experience

in

adapt to remain competitive?

multiple areas and markets, which is extremely important

A: The Millennial generation is extremely strong, and

and adds value to the industry. In markets where there

different from the Baby Boomers. They are the largest

is more specialization, employees will focus only on one

generation at this point. This segment is much more

area, such as medical technology or biopharmaceuticals.

interested in their quality of life and base their decisions

People are very polished in the healthcare industry. At this

on the work environment and experience. We have seen

point, there are strong concerns on the topic of the single

some companies completely change their workforce

payer system and what actions will the government take

and work environment for them. For instance, previously

to promote healthcare in the country. The government

personal offices for leadership roles would take about

may decide to follow the example of other economies

80 percent of the space in an office. Now, these offices

around the world where medicine is subsidized, leading to

only take 20 percent while the rest is open space to allow

a healthier workforce, which is in a better position to help

employees to communicate.


| VIEW FROM THE TOP

BUSINESS BACKGROUNDS ENHANCE HEALTHCARE SECTOR LEADERSHIP IGNACIO PÉREZ Managing Partner at Heidrick & Struggles

Q: What role does the life sciences industry play in

but oftentimes they are reluctant to come back. On the

Heidrick & Struggles’ strategy?

contrary, there are many foreigners in Mexico occupying

A: Founded in 1953, Heidrick & Struggles is the oldest top

leadership positions who do not want to leave when their

executive search firm comprising several practices such as

contract ends. Moving from one company to another

financial services, global technology, consumer, industrial

regardless of them being in the same market segment

and healthcare and life sciences. Each practice has different

requires adaptation and a cultural fit and this process

subsectors, the latter comprising the pharmaceutical

should not be minimized as it is necessary to learn the

industry, medical devices, biotechnology and healthcare

company’s priorities and the short, middle and long-term

which all comprise one of the largest practices in Mexico.

strategies. 305

We also offer consulting services such as top level assessment, top directors effectiveness and cultural

Q: What should be an executive’s focus on their first days

shaping. Thus, we have substantial experience providing

in a company to guarantee success?

pharmaceutical and medical devices companies with tools

A: The first 90 days are crucial for an executive’s success.

to develop strong leadership and organizational culture.

Learning about business trends, priorities, talent within

I believe talent in the pharmaceutical industry is scarce

the company and gaining industry expertise should be

and there is a need for hiring leaders with both medical

a priority. There are six factors the new manager should

and business backgrounds and skills. Hiring traditional

focus on. Culture is the first one. This means leaders need

doctors who lack knowledge on business strategy is not

to be fully involved in the company’s culture, including

a wise move in today’s pharmaceutical industry. Similarly,

the mission, values, strengths, weaknesses and drivers.

hospitals could hire people capable of making better

The second factor is talent, which is getting to know

decisions based on a clear understanding of the market

and building the team they are leading. The third is the

drivers and business environment.

business, which basically entails learning about it and its problems with products, providers and clients among

Q: What considerations should a company take into

others. The fourth factor is familiarizing with the local and

account when evaluating a candidate for an executive

regional expectations in a two-way sense: the company’s

position?

ideals, as well as the leader’s vision. The fifth is networking

A: We map the entire market across industries to find the

with internal and external providers and clients. The last

right talent. Some positions such as CFOs and CHROs,

one is thoroughly knowing the products and services

can be filled by people from other industries, which works

offered by the company and the pipeline.

smoothly when their previous work experience allows them to learn about pharmaceutical industry dynamics.

Q: Mergers and acquisitions are commonplace in the

Recruiting talent from abroad is another strategy being

pharmaceutical industry. How can cultural alignment

implemented by many companies and the number of

between two different companies be fostered and

Mexican and foreign executives in top managerial positions

achieved?

is equitable. We find candidates through a clearly defined

A: Aligning the culture of both organizations is extremely

search strategy and a cultural fit assessment. We also

important and it is necessary to define whether it is an

map second level managers in Mexico who might be

acquisition of products and/or services and then making

ready to jump to the top position and help them develop

the cultures merge and work together. Cultural shaping is

the necessary skills for it. In addition to ethical values

a continuous process since new people join the company

and skills, the cultural fit accounts for 80 percent of a

constantly. The acronym DURAM helps us remember to

leader’s success. When it comes to attracting talent from

Define the culture, Unfreeze to kick bad habits, Reinforce

abroad, we always consider expatriate Mexican leaders

the culture, Apply to the business and Measure it.


| VIEW FROM THE TOP

NAVIGATING LOCAL WAVES IN MEXICO AND LATAM PAUL DOULTON CEO of Oriundo

Q: In the context of the Mexican landscape, what do you

for risk in investment and the degree of control needed.

believe is Oriundo’s role and how was this accomplished?

We then find the right solution and most appropriate fit.

A: We help companies understand Latin America, with

Many companies try to do this alone but are rarely able to

its 22 countries and differing market dynamics. Oriundo

identify the most strategic alliances to meet their needs.

means “someone who hails from” and we channel this

306

by helping foreign companies navigate local waters. Our

Q: What role do Mexico and other Latin American countries

offices are all over Latin America including Argentina,

play in companies’ internationalization strategy?

Brazil, Chile, Peru, Mexico and Colombia. At Oriundo, we

A: We have been in business for about 15 years and we now

help our clients develop the right entry strategies into

have more work than we ever had before, which reflects

Latin America through licensing, distributors, partnering,

the increasing interest in the Mexican and Latin American

joint ventures, or acquisitions. One of the most successful

markets. This is due not to the market growing, and its

strategies has been outsourcing marketing, regulatory,

regulatory environment, which is highly supportive of the

medical and sales services and try before you buy, while

industry. In comparison, the regulatory framework in other

others prefer partnering with Mexican companies. The

countries, such as Brazil, is still extremely protectionist.

right strategy depends on the company’s portfolio, what

The policies introduced by Mikel Arriola in Mexico are

the customer wants to achieve, his appetite or reluctance

speeding the introduction of new molecules into the

| EXPERT OPINION

DOULTON SEES GROWTH FOR MEXICAN HEALTHCARE Latin America has a population of 500 million, with a

the low spending and reduced priority for healthcare on

pharmaceutical market of US$80 billion and it is expected

the political agenda.

to rise to US$150 billion in the medium term. Most of the economies in the region are growing, excluding

The amount of money that is spent is not the problem.

Brazil, Argentina and Venezuela but economies such as

Most healthcare budgets are fixed on expenditure and

Colombia, Mexico and Peru are implementing sensible

not on outcomes. Payer and provider are often the same

policies to promote growth. Healthcare spending rises with

entity, so money cannot flow to the most efficient provider.

GDP growth but out-of-pocket spending still outpaces

Healthcare decisions are taken from the patient and a

public provision. All this means growth for the pharma

dependency culture has been the unwanted result. The

industry and only by understanding where healthcare is

only system approaching viability is Colombia where the

headed, and the new rules it encompasses, can successful

government has set strict rules ensuring the separation of

strategies be devised.

payer and provider. In this case, the private sector is the funder, a separate provider comes from the private sector

The Latin American healthcare system faces similar

and the authorities simply oversee the process. In Mexico,

challenges to the developed world with funding running

healthcare coverage rose from barely 15 percent of the

out in the face of an aging population, especially older

population to close to 90 percent in about 10 years, all

populations such as Chile and Argentina, although the rest

managed by the private sector.

of the region has a positive demographic balance. Social security and public healthcare provisions differ widely

The Mexican system is suffering great fatigue not only

from country to country and much criticism is leveled at

because of duplication of coverage but also because of


country. It also makes the process more predictable,

business model by acquiring local generic companies and

fair, reduces the duplication of work and approval by

an issue they face after acquisition is trying to use their

other serious regulators such as EMA and the FDA. This

former business model by promoting to doctors, using the

is all being done without the need to relax standards

old wholesaler and pharmacy channel for generics too.

or

Mexico’s

The only commonality between a patented medicine and

pharmaceutical and generics manufacturers now meet

its generic counterpart are its manufacturing and patient

global standards. Mexico benefits from a sound economy

consumption but the intermediate market dynamics are

and positive regulatory environment so many companies

entirely different. The more successful generics companies

are now choosing the country as a launching pad for Latin

are often managed by former fast moving consumer

America. At Oriundo, we have spent eight years studying

goods executives well versed in the channel dynamics and

healthcare systems across the region in order to ensure

who are focused on improving the value chain. As for local

that companies know where local policy and its execution

generic producers, pharmacy and supermarket chains are

is headed.

also promoting growth, especially private label generics.

compromise

patient

safety.

Contrarily,

These chains now represent more than 60 percent of all Q: How can both international and local companies drive

pharmaceutical product sales and are still growing. Local

growth in Mexico given the challenges they face?

producers, especially of generics, have traditionally been

A: International companies generally thrive in generating

flexible during manufacturing, which enables them to

and introducing new molecules. Major innovators are

meet market regulation, low-inventory and ever changing

losing their patents and have been unable to generate

requirements of the big chains just in time. Manufacturers

new ones fast enough. As a result, big pharmaceutical

in India, the US and elsewhere with large dedicated plants

companies are implementing new strategies such as

are not able to match these requirements at a distance.

the acquisition of smaller ones. For example, Merck

Therefore, local manufacturing, at least for high volume

(MSD) recently bought Schering Plough, Pfizer is buying

products, has gone from a regulatory to a strategic

Allergan, while Sanofi has incorporated 10 to 12 different

imperative. Price is indeed far from the most important

companies.

factor in Mexico.

International

companies

modified

their

vested interests, lack of competition, aging population,

and more recently Head of Harvard School of Public Health,

decisions taken away from the patient and interference in

tried to make the necessary changes to the social security

the doctor-patient relationship. Hope is around the corner,

system but faced great reticence from the sector, with its

however, with the creation of Seguro Popular, a funding

strong union and private interests. Therefore, he created

agency today covering more than half of the population. The

Seguro Popular with the goal of making this institution the

intention is to establish Seguro Popular as the unique funder

unique payer for medical services in Mexico but this has

for healthcare and purchase provision on a competitive,

not been accomplished. However, the institution is able to

outcome-focused basis from the array of social security

buy services from the main public healthcare organizations

hospitals and clinics, as well as from the private sector.

including IMSS and ISSSTE, therefore reducing duplication. Another problem with the social security sector is the long

To improve health and reduce expenditure, healthcare

distances patients have to travel in order to receive medical

should become a priority with the patient at the center.

care. Today, Seguro Popular has surpassed IMSS as the

The patient should decide how his medical savings are

institution with the largest number of affiliates so nearly 96

spent or saved with strong advice from his primary care

percent of the population now has some form of healthcare

doctor. This engages the patient in seeking wellness

coverage.

as they have been shown to be more careful with their money. There are indeed other successful examples

Mexico is a buoyant market, growing steadily if not

through medical savings in countries like Singapore,

spectacularly. The pharmaceutical market value is between

which has a healthy population, content doctors and

ninth and 11th globally, worth close to US$20 billion, with

government, while spending barely 4 percent of the GDP.

US$14-15 billion in the private sector and US$2-4 billion in

Finland is also headed down the same road. In healthcare,

the public sector. The North of Mexico is closer than ever

the source of the decision represents a direct indicator of

to becoming a developed market with sophisticated and

whether health will improve. Politicians should embrace

highly competitive manufacturing centers, as evidenced by

the patient-centric model as it circumvents acrid criticism

the continuous inward investment into new plants both for

about healthcare rationing. Julio Frenk, as Health Minister

small and large molecule manufacture and related services.

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| VIEW FROM THE TOP

MEETING HEALTH MARKET NEEDS VIA TALENT DEVELOPMENT DOMINIK BACHER Director General of Bacher Zoppi

Q: What are the main gaps you want to close in the

Nowadays patients are more aware of costs and they

healthcare industry?

have new needs, such as better and more efficient

One of the main areas of opportunity is the point of

therapies and services. There is huge potential for

sale. The complexity of the market makes it necessary to

the pharmaceutical industry to consider, not only

establish business partnerships to ensure the availability

products but also more complete services. Patients are

of products at points of sale, to optimize the distribution

open to technology, generating a big opportunity for

of new products and to avoid the substitution of brands.

the development of new apps and systems that help connect patients with their doctors. This can have a

308

Bacher Zoppi has established three business areas or

major impact on prevention, diagnostic and treatments.

services lines: sales teams visiting physicians at their private

We have many pilot projects in this service area and

office and hospitals to generate sustainable demand; sales

we believe this field has enormous growth potential in

teams to optimize the distribution and attend the point

the next few years. Our clients are searching for data

of sale to guarantee the availability of the product; and

protection services and upgraded services focused not

finally services that offer added value to the patients. In

only on products, but on the provision of treatments and

many cases, especially for new brands, our customers

medical care in a collaborative way. The company also

ask for better access to patients and programs to ensure

has evaluated various projects of telemedicine because

adherence to the prescription or recommended treatment.

we are convinced that they have great potential to satisfy patient needs.

Q: To what extent do you agree with experts’ opinion that primary care at the point of sale needs to be regulated?

Q: How do you help your clients find the right talent

We see that primary care at the point of sale is a model

considering that Mexico does not have the necessary

that has been very successful in Mexico and in my view,

number of specialized professionals to satisfy all the

this is an irreversible tendency. The model allows easy

needs of healthcare services?

and comfortable access to primary care for the Mexican

We are searching for talent according to client needs.

population. Now the challenge is professionalizing medical

There are many levels of expertise and annually we

attention at pharmacies.

recruit over 1,000 pharmaceutical sales professionals and medical staff for specific projects. The evaluation

Q: Would you say that distribution is the main factor

method that Bacher Zoppi has implemented is designed

to consider in expanding the life cycle of a brand after

to reduce the gaps between what skills we are looking

patent expiration to maintain its competitive position in

for and the availability within the human resources

the market?

market. In addition, at Bacher Zoppi we have a platform

We believe and have experienced that it is possible to extend

to train and develop staff and we constantly certify

the life cycle of brands through optimized investment,

and re-evaluate our personnel. We also have built a

considering three key factors: a physician calling to remind

big data base with approximately 30,000 candidates

the brand, the distribution to make the therapy available

with different profiles that can be adapted to specific

and finally the price. At Bacher Zoppi we have experience

projects; so we find candidates with the profile our client

in helping industry reduce the impact on their revenues and

is looking for. However, we have noticed a reduction in

developing investment strategies for mature brands.

the size of the sales forces in pharmaceutical companies, as part of a worldwide trend to control expenses. Bacher

Q: What role do patients have in the healthcare system

Zoppi is focused on the commercial part of the industry,

and how are companies striving to put patients at the

meaning that our main expertise is recruiting and

center along with institutions?

managing sales talent


| VIEW FROM THE TOP

HEALTHCARE REQUIRES PUBLIC SECTOR PUSH LOUISE BATCHELDER CEO of SYNELOG MEXICO

Q: How are the recent tax reforms impacting the

national program, which aimed to have the private sector

healthcare industry?

finance new public hospitals. After a revision of PPP law

A: Tax reforms affect every economic sector including

other hospitals may still be built in the second half of this

healthcare. Under the new regime not only are taxes

administration.

higher but foreign investment will have to adjust to it. International companies used to be able to deduct certain

Q: What new entry strategies are pharmaceutical

payments from their local offices but the new reforms

companies implementing?

make them liable for more taxes, which is a disincentive

A: Eighteen months ago CANIFARMA and AMIIF generated

for new and continuous investment. Fiscal reforms affect

and implemented a new strategy called Shared Risk,

everyone including people who buy medicines and more

which meant pharmaceutical companies would provide

specifically people from the middle class. They drive the

innovative drugs to the public sector at no cost so that

demand for brand products. Therefore, a hit on their

patients could receive a trial period for their treatment. If

economy slows down demand for brands and innovative

the patient got a positive outcome the government would

medicines and increases generics being sold.

then be obliged to pay the price in full for the drugs.

Q: How is the government fostering the sector?

Though pharmaceuticals are not thrilled to be giving

A: The government has developed national programs for

away free medication these types of strategies prove the

every sector and they are available online for all to read.

willingness of the sector to overcome barriers.

But considering the effort made during the Energy Reform, I would say healthcare is not a priority right now. Public

Q: Has R&D in Mexico progressed?

officials have to prioritize according to budget availability

A: The link between research and commercialization has

and there have been significant cuts in the sector. Big

not changed significantly for the past 10 years. Back in

Pharma in Mexico has stated the government does not

2005, I was involved in a life sciences study and at that

perceive healthcare as a priority, much less innovation.

time we had many hopes that have not materialized due

Innovative medicines that are being brought into the

to financing problems. Angel financing does not exist in

country are the most significant challenge for subsidiaries.

Mexico. NAFIN and Bancomext are not prepared to take

The healthcare system has suffered budget constraints

risks, which is paradoxical as the purpose of a development

and a failure to implement an effective healthcare policy,

bank is to support the commercial banking system in

which has resulted in poor performance impacting the

handling risks. Other industrial activities may enjoy tax

pharmaceutical industry and R&D in Mexico.

breaks for undertakings such as building new plants or job generation. But given the limited risk the government is

Q: What can Mexico learn from other countries regarding

willing to accept for research there is a blockage between

Public Private Partnerships (PPPs)?

R&D and commercialization.

A:

Recently,

the

Minister

of

Health

said

in

the

administration’s first three years, PPPs have not been used

Q: What specific activities is SYNELOG MEXICO doing to

to their utmost potential. The UK, a world leader in these

promote innovation?

type of partnerships, advised the Mexican government on

A: SYNELOG provides consulting in healthcare, education,

how to use this tool and to this day Curry & Brown are

social development, science and technology, innovation

still the government’s tactical advisers. During the current

and competitiveness. At this point, I am interested in the

tenure only one PPP hospital has been built and the

lack of patenting offices in most Mexican universities. I am

procurement was led by ISSSTE Mexico City and not the

researching what structures could be set up so that any

Ministry of Health. This has paralyzed the health sector’s

university can set up their own in-house patenting office.

309


| VIEW FROM THE TOP

IMPROVING HEALTHCARE ACCESS FOR THE UNDERPRIVILEGED JAIME CERVANTES Director General of Grupo Vitalmex

310

Q: What would be the most relevant inefficiencies in the

and the potential target is 5 million. The opportunity is

healthcare system and how do you help in fixing them?

so important that it is almost impossible for one single

A: As in many other countries, there are inefficiencies in the

company to provide the required services. There are not

Mexican health system. The WHO suggests five indicators

enough companies with the quality standards to help the

that healthcare systems across the world should adhere

national health system implement the five WHO indicators.

to in order to fulfill their ultimate goal, which is to improve

We have five main competitors and are the pioneers of

public health. The first one is that the system has to be

integrated services. We are replicating our service model

humane, and we have incorporated this by ensuring that

in other nations. Mexico is the only country that has

we give dignified treatment to all. The second indicator

developed integrated services, while others, such as the

is availability, meaning all supplies and goods necessary

US, are surprisingly behind in terms of service delivery to

for patients should be available in a timely manner, which

hospitals. For this reason, we are targeting the American

requires significant logistic efforts. Accessibility is the third

market in the short and medium term.

indicator, and it is typical in emerging countries to see both protected and unprotected people, which is why Grupo

Q: How are you planning to mitigate the financial risk of

Vitalmex is creating a substitute infrastructure consisting of

offering healthcare services to the less affluent?

clinics to satisfy the demand for healthcare services for the

A: The only way we can mitigate such risk is by establishing

underprivileged. In the near future, we look to expand our

our clinics and hospitals in strategic locations. We are

reach to include clinics and hospitals. If we can do this in

planning to launch our model in Colombia, Peru and Mexico

collaboration with Seguro Popular we will be able to provide

simultaneously and I truly believe it will be a great project.

excellent options for patients.

This brings us back to the fourth indicator of the WHO, which is a timely healthcare system. People should receive

Q: Are there any indicators of hospitals’ performance

medical attention whenever and wherever it is required

improving due to your services?

and in reality many Latin American countries still do not

A: Our services reduce costs in the range of 12 percent to

have the infrastructure in place. The WHO indicators relate

20 percent, while increasing productivity of patient care

to an effective system and I would say the system that

and coverage by an average of 30 percent. Additionally,

exists today is relatively ineffective. However, if properly

surgeon and physician techniques improve significantly. We

implemented, the five indicators would help to transform

measure this indicator based on the rate of implementation

Mexico’s healthcare system, which includes its three levels

of our services. The final goal is to improve the patient

– private, social security and the base of the pyramid.

experience. A challenge we face is to merge our sales force with the vision of our partners, because the health industry

Q: What is next for Grupo Vitalmex in terms of expansion?

pushes hospitals and institutions to acquire the newest

A: We are also exploring possibilities in Germany and

technologies. There is a constant drive for innovation.

the Scandinavian markets. We aim to collaborate

Health institutions are interested in reducing costs; patients

in developing useful healthcare systems across the

want the most comprehensive medical attention possible

globe and our company has the experience and

and doctors are determined to improve their work. A

knowledge in healthcare to benefit our stakeholders.

balance of these three factors is necessary.

We are undergoing a process of vertical and horizontal integration to become one of the main healthcare service

Q: How significant is the opportunity to expand this kind

providers for the bottom of the pyramid, as poverty is

of service in Mexico and other countries?

still a relevant issue in Latin America. We have before

A: Mexico performs 2 million medical procedures per year,

us a solid opportunity to increase access to healthcare

including surgeries. At this point, we are covering 700,000

services through our clinics.


| VIEW FROM THE TOP

DEVELOPING MEXICAN-SPANISH PARTNERSHIPS ÁNGEL ALONSO CEO of VecMedical

Q: What type of participation does VecMedical have in

Q: When do you expect this cooperation with the IMSS

the Mexican market?

to happen?

A: We have a single Mexican distributor but we are

A: We have contacted some people, one of which worked

evaluating whether it is more advantageous to expand

in the hospital in Barcelona. We know her well and

our sales volume with them or whether to diversify our

worked on other projects with her, so communication for

efforts with others. Even though our product has received

future projects will be fluid. Now cooperation is simply a

the Conformité Europeéne (CE) certification from the

question of starting. There are two ways of working with

European Union, we are yet to secure a COFEPRIS registry.

the IMSS. They have been working for a certain amount of time on detecting the potential of projects and ideas

VecMedical is part of the Catalan Health Technology

that doctors have but perhaps do not find an opportunity

cluster. We are establishing a collaborative innovation

to develop. They have technological needs that we may

group, looking to create link-up partnerships with

be able to assist with, for example making prototypes. We

Catalan institutions from a clinical, industrial and

will concretely begin to contribute to a certain amount of

technological standpoint. Research is strong in Catalonia

projects. Other opportunities arise when are collaborating

but few products emerge from these efforts. As such,

on clinical research projects as we are doing in Barcelona.

we are looking to potentiate and secure these areas

The collaboration is bidirectional. We are about to sign an

of opportunity. Spain’s bilateral relations with other

agreement that will allow us to start work soon. Here at

countries have allowed us to expand our market reach,

VecMedical we are conducting clinical trials in Barcelona,

inserting our products in countries such as Mexico.

when finished we will send this to the IMSS.

We are holding meetings with the IMSS innovation department to jointly develop projects that will benefit

Q: What benefits will this collaboration bring other than

both parties. We are also looking to secure a framework

the great volume of patients?

agreement with ISSSTE, working on clinical research

A: Firstly, it will complete the feedback process as patients

and developing solutions, services and products. There

in Mexico may present different symptoms than those in

are other ways in which VecMedical and the Catalan

Germany or other countries. Secondly, if this collaboration

Health Technology cluster can potentiate the global

happens, we will have information directly obtained

participation of Mexican players. We can help them enter

in Mexico and I believe access to the market from a

the European market, which we have already done with

regulatory point of view will be simpler as the registration

Brazilian companies.

with COFEPRIS will be simpler.

Q: What are the conditions of the Mexican market

Q: To what extent have you considered opening a

VecMedical is adapting to?

subsidiary here in Mexico?

A: Market conditions are general, not exclusive to Mexico.

A: For our more mature products, we have two or three

Each area in the implementation and development of

distributors and so it would not make sense to open a

technology possesses a particularity of the Mexican

subsidiary. There is already an underlying basic framework

environment. When VecMedical develops a new product,

in place and registered producers. For new products in

we try to do multi-country clinical trials whereby we work

development it is interesting for us to have control of the

not only in the clinic and hospital of Barcelona and with the

registration, particularly for respiratory products. In this

IMSS and ISSSTE in Mexico but also in Denmark and other

area it would interest us to have a branch or an affiliate

countries. This gives us more positive and constructive

here. We have begun talks with some advisers here to

feedback and allows us to offer a more robust product

study the possibility of beginning with a branch and then

when we bring it to market.

an affiliate.

311


| GLOSSARY A-C ACRONYM

FULL NAME

AMEIFAC

Asociación de Médicos Especialistas en la Industria Farmacéutica (Association of Medical Specialists in the Pharmaceutical Industry)

AMID

Asociación Mexicana de Industrias Innovadoras de Dispositivos Médicos (Mexican Association of Innovative Medical Device Industries)

AMIIF

Asociación Mexicana de Industrias de Investigación Farmacéutica (Mexican Association of Pharmaceutical Research Industry)

ANHP

Asociación Nacional de Hospitales Privados (Association of National Private Hospitals)

APEC

Asia-Pacific Economic Cooperation

API

Active Pharmaceutical Ingredients

BPCIA

Biosimilar Price Competition and Innovation Act

CANACINTRA Cámara Nacional de la Industria de Transformación (National Chamber of the Manufacturing Industry) CANIFARMA

Cámara Nacional de la Industria Farmacéutica (National Chamber of the Pharmaceutical Industry)

CAUSES

Catálogo Universal de Servicios de Salud (Universal Catalogue of Health Services)

CDMX

Mexico City

CENSIDA

Centro Nacional para la Prevención y el Control del VIH/SIDA (National Center for the Prevention and Control of HIV and AIDS)

CETIFARMA

Consejo de Ética y Transparencia de la Industria Farmacéutica (Council of Ethics and Transparency in the Pharmaceutical Industry)

CIDEFARMA

Centro de Investigación y Desarrollo Farmacéutico (Center for Pharmaceutical Research and Development)

CINVESTAV

Centro de Investigación y Estudios Avanzados (Center of Investigation and Advanced Studies)

COFEPRIS

Comisión Federal para la Protección contra Riesgos Sanitarios (Federal Commision for the Protection Against Sanitary Risks)

COMECYT

Consejo Mexiquense de Ciencia y Tecnología (State of Mexico’s Council for Science at Technology)

COMOP

Comité Mexicano para la Prevención de la Osteoporosis (Mexican Committee for the Prevention of Osteoporosis)

CONACYT

Consejo Nacional de Ciencia y Tecnología (National Council for Science and Technology)

CONADIS

Consejo Nacional para el Desarrollo y la Inclusión de las Personas con Discapacidad (National Council for the Development and Inclusion of Disabled People)

CONCAMIN

Confederación de Cámaras Industriales (Confederation of Industrial Chambers)


| GLOSSARY C-S COPARMEX

Confederación Patronal de la República Mexicana (Mexico’s Business Owners Confederation)

COSMEP

Código de Autorregulación y Ética Publicitaria de Productos del Cuidado Personal y del Hogar (Code of Autoregulation and Publicitary Ethics for Personal and Household Hygiene)

CRF

Case Report Forms

CRO

Contract Research Organization

CSG

Consejo de Salubridad General (General Health Board)

CT Scan

Computed Tomography Scan

CTMS

Clinical Trial Management System

EMA

European Medicines Agency

FDA

Food and Drug Administration

FUNSALUD

Fundación Mexicana para la Salud (Mexican Foundation for Health)

GCP

Good Clinical Practices

GMP

Good Manufacturing Practices

IIIFAC

Instituto de Investigación e Innovación Farmacéutica (Pharmaceutical Innovation and Research Institute)

IMPI

Instituto Mexicano de la Propiedad Intelectual (Mexican Institute of Intellectual Property)

IMSS

Instituto Mexicano del Seguro Social (Mexican Institute of Social Security)

INCAN

Instituto Nacional de Cancerología (National Insitute of Cancerology)

INSP

Instituto Nacional de Salud Pública (National Institute of Public Health)

IPN

Instituto Politécnico Nacional (National Polytechnic Institute)

ISAPS

International Society of Aesthetic Plastic Surgery

ISO

International Organization for Standardization

ISSSTE

Instituto de Seguridad y Servicios Sociales de los Trabajadores del Estado (Institute of Safety and Social Services for Federal Workers)

ITESM

Instituto Tecnológico y de Estudios Superiores de Monterrey (Technological Institute of Monterrey)

JCI

Joint Commission International

LAMMB

Laboratorio de Análisis de Moléculas y Medicamentos Biotecnológicos (National Laboratory for Production and Analysis of Biopharmaceuticals)

LATAM

Latin America

MRI

Magnetic Resonance Imaging

MTA

Medical Tourism Association

NCDs

Non-Communicable Diseases


| GLOSSARY N-Z NOM

Normas Oficiales Mexicanas (Mexican Official Norms)

NORMEX

Sociedad Mexicana de Normalización y Certificación (Mexican Society of Standardization and Certification)

OECD

Organisation for Economic Co-operation and Development

OEM

Original Equipment Manufacturers

OTC

Over the Counter Products

PAHO

Pan American Health Organization

PET Scan

Positron Emission Tomography Scan

PIPCCM

Programa Integral de Prevención y Control del Cáncer en México (Mexico Cancer Prevention and Control Program)

PPP

Public-Private Partnership

R&D

Research and Development

REDLARA

Red Latinoamericana de Reproducción Asistida (Latin American Network of Assisted Reproduction)

Rx

Prescription Drugs

SALUD

Secretaría de Salud (Ministry of Health)

SEDENA

Secretaría de Defensa Nacional (Ministry of National Defense)

SEMARNAT

Secretaría de Medio Ambiente y Recursos Naturales (Ministry of the Environment and Natural Resources)

SINGREM

Sistema Nacional de Gestión de Residuos de Envases y Medicamentos (National Waste Management System for Packaging and Drugs)

SMAES

Sociedad Mexicana de Arquitectos Especializados en Salud (Mexican Association of Specialized Healthcare Architects)

SMSP

Sociedad Mexicana de Salud Pública (Mexican Society of Public Health)

SOP

Standard Operating Procedure

TPP

Trans-Pacific Partnershp

UAM

Universidad Autónoma Metropolitana (Autonomous Metropolitan University)

UANL

Universidad Autómoma de Nuevo León (Autonomous University of Nuevo Leon)

UDEM

Universidad de Monterrey (University of Monterrey)

UNAM

Universidad Nacional Autónoma de México (National Autonomous University of Mexico)

UNICEF

United Nations Children’s Fund

WHF

World Heart Federation

WHO

World Health Organization


| ADVERTISING INDEX 6 TAPVS

183 Qually

36

ABC Hospitals

189 Olivares

52-53

Mayoly Spindler

194 AMIIF

62

Pierre Fabre

204 LEI

71 Janssen

212 MBE

75

217

IM Natural

88 Hetlabs

Pharma Tycsa

230

Sports World

96

Aspen Labs

248 BOMI

108

Farmacias GI

255 NTA

127 BioSkinco

260

World Courier

136

APE Editorial

268

World Stem Cells

154

R.H. Shipping

281

Tijuana Bariatrics

176

Grupo Bruluart

290 MBP


| INDEX A-I 1DOC3 165

Coral Dental Center 287

3M 113

CostaMed 285

ABC hospitals 48

Croda 196, 201

Accelerium 189

Deloitte 294

ACROM 20, 178, 190-191

Dentistar 286

Alandra Medical 132

Digitalizatxt 168-169

Alfa Wassermann 77

Distribuidora Levic 258

AMEIFAC 19, 28

Dräger 112

Amgen 74-75, 81, 196

Entimem 303

AMIIF 20-21, 44, 181, 309

EPIC CRO 186

Anti-Obesity Center 245

Farmacias GI 104

Apotex 95

Farmalisto 264

ASMED 59

Farmapiel 214, 218

Aspen Labs 97

FENIN 30

Astrum Salud 166-167

Fertility Center Cancun 278

Avinent 168

Fundación Carlos Slim 24-25, 148, 164

Bacher Zoppi 308

FUNSALUD 20, 22-23, 74

Baker & McKenzie 297

Galderma 214, 221

B. Braun Aesculap 31, 118

GE Capital 110-111

BioMérieux 146-147

GE Healthcare 110-111

BIOSKINCO 198

Glenmark 94

Boehringer Ingelheim 68, 253

Global Health Intelligence 50, 115, 172-173

BOMI de México 250-251

Greatbatch 119

Brudifarma 100, 252

Grisi 215, 222

Bupa Global Latin America 299

Grupo Body Systems 239

Cancun Oncology Center 276-277

Grupo Marzam 262-263

CANIPEC 8, 216-217, 214

Grupo Neolpharma 98

Canon 116-117

Grupo Vitalmex 310

CareFusion/Becton Dickinson 202-203

Hays 298

CDM Labs 214, 215, 220

Healthlinks 301

Centro de Oftalmología Monterrey 274-275

Heidrick & Struggles 304-305

Cetifarma 78-79

Hetlabs 92-93

Clínica de Mérida 57

Hogan Lovells 300

Cluster Ciudad de la Salud 272

Hospital Galenia 56, 276, 277

Cluster Tijuana EDC 130

Hospital General de México 46-47

CODY 58

Hospital San Angel Inn 55

COFEPRIS 8, 10-11, 19, 20, 21, 30, 35, 38, 42,

Hospital San José 284

43, 44, 59, 61, 65, 68, 69, 74, 81, 85, 87, 92, 93,

Hospitaria 51

95, 98, 99, 100, 104, 105, 117, 120, 121, 128, 129,

IBt 197, 205

131, 132, 143, 158, 169, 175, 178, 179, 180, 182, 184,

ICON 188

188, 189, 191, 196, 197, 198, 200, 202, 204, 207,

IIIFAC 80

217, 218, 220, 236, 237, 240, 243, 252, 253, 254,

IM Natural 215, 223

261, 274, 289, 294, 296, 300, 301, 302, 303, 311

IMS Health 92, 95, 156

COMOP 149

IMSS 8, 14, 20, 21, 24, 30, 31, 35, 38-39, 41, 42,

ConvaTec 122-123

44, 45, 56, 57, 66, 80, 93, 112, 121, 133, 138, 145,


| INDEX I-Z 146, 151, 153, 156, 159, 179, 181, 183, 184, 188, 190,

Providien 126-127

229, 257, 273, 295, 307, 311

PwC 159, 295

INCAN 8, 112, 135, 138, 140, 151, 156

QBD Consulting 158

INSP 9, 26-27, 138, 144-145, 149, 313

Qually 105

Infinite Clinical Research 178, 190

Quintana Roo Medical Travel Association 270

inVentiv Health 178, 185

RegenerAge 209

IREGA 279

R.H. Shipping 259

IVINSEMER 208

RM Pharma 179, 182-183

Janssen 66, 70-71, 81

SANAR 243

Kaloni 215, 224

Scantibodies 206

Laboratorios Keton 99

Minister of Health of Mexico City 12, 13, 42

Landsteiner Scientific 69

SEFOTUR 32

LEI 178, 179, 184

Seguro Popular 14, 15, 20, 35, 40-41, 42, 45,

Liomont 90-91, 256

46, 85, 138, 140, 144, 149, 153, 307, 310

Lundbeck 81, 200, 204

Sesderma 215, 219

Malvern Instruments 207

Siemens 114, 138, 150

Marken 265

SignuFarma 81

Mayoly Spindler 102

SINGREM 256

McKinsey & Company 292-293

SMC 138, 142

Medisi 129

Smile Train 160-161

Medtep 162-163

SMSP 18

Medtronic 120-121, 132

Sports World 238

Merz Pharma 215, 225

Swiss Hospital 54

Mexican Diabetes Association 172-173, 235,

SYNELOG 309

282

Takeda 76

Miroculus 138, 151

TAPVS 302

MyHeart 143

Terumo 128

Nestlé 22, 214, 221, 237

The Green Corner 242

Novag 103

Tijuana Bariatrics 8, 214, 227, 280-281

Novartis 65, 157, 165

UDEM 54, 272, 275

Novo Nordisk 72-73

UNAM 11, 12, 42, 44-45, 47, 70, 78, 90, 91, 92,

NTA 254-255

98, 142, 169, 180, 184, 197, 205

NYCE 131

Unicef 16, 148, 153, 170-171, 229, 234

OLIVARES 296

UROSUR 273

Omnilife 233, 240-241

ValidPro 253

Oriundo 306-307

VecMedical 311

Össur 81, 124-125

Ventura 133

Parque TecniA Universidad Anáhuac 32, 271

Videre 282

Pfizer 64, 81, 307

WHO 10, 14-15, 76, 91, 98, 142, 149, 151, 244,

Pharma Tycsa 257

294, 300, 303, 310

Pierre Fabre 66-67

World Bank 27, 122, 289

PPD 178, 180-181

World Courier 261

PRA Health Sciences 179, 187

World Stem Cells Clinic 199

PROBIOMED 84-85 Productos Medix 82, 236


| PHOTO CREDITS 4

© Mexico Tourism Board: Photo/Ricardo

77 MBP

Espinosa-reo

78 MBP

10 MBP

80 MBP

12 MBP

80 MBP

14 MBP

81 MBP

16 MBP

82

Productos Medix

17 Dräger

82

Productos Medix

18 SMSP

84 PROBIOMED

19 AMEIFAC

86

20 MBP

90 MBP

21

91 Liomont

Productos Medix

Productos Medix

22 MBP

92 MBP

23 Dräger

94 MBP

24

95 MBP

Fundación Carlos Slim

25 Raystormxc

97 MBP

26 INSP

98 MBP

27

99 MBP

World Bank

28 AMEIFAC

100 Brudifarma

29 ProMéxico

101

30 FENIN

102 MBP

31

B.Braun Aesculap

103 MBP

32

Parque TecniA

104 MBP

Pierre Fabre

32 SEFOTUR

105 MBP

34 Dräger

105 MBP

38 MBP

106 Dräger

39 Dräger

110 MBP

40 MBP

110 MBP

42 MBP

112 MBP

44 MBP

113 3M

45

114 MBP

Centro de Oftalmología Monterrey

46 MBP

115

48 MBP

116 MBP

51 MBP

118

54

119 MBP

Swiss Hospital

Global Health Intelligence B.Braun Aesculap

55 MBP

120 MBP

56 MBP

122 MBP

56 MBP

124 Össur

57 MBP

125 Össur

58 MBP

126 Providien

59 MBP

128 Terumo

60

129 Medisi

Boehringer Ingelheim

64 Pfizer

130

65 MBP

131 MBP

66 MBP

132

Alandra Medical

67

133

Ventura Medical Technologies

68 MBP

134

Novo Nordisk

69 MBP

139 Sesderma

70 MBP

140

Instituto Nacional de Cancerología

72

Novo Nordisk

140

Instituto Nacional de Cancerología

73

Novo Nordisk

Pierre Fabre

Clúster Tijuana EDC

141

World Stem Cells

74 Amgen

142

Sociedad Mexicana de Cardiología

76 Takeda

143 MBP


| PHOTO CREDITS 143 MBP

220 MBP

144 INSP

221 MBP

146 BioMérieux

222 MBP

149 MBP

223

150

224 Kaloni

Siemens Healthineers

IM Natural

151 MirOculus

225 MBP

152 MedTep

227

Tijuana Bariatrics

156

228

Sports World

IMS Health

157 Novartis

234 MBP

158 MBP

235

159 PwC

236 MBP

160 MBP

237 Nestlé

160 SmileTrain

238 MBP

160 MBP

239

161

240 Omnilife

World Stem Cells

Mexican Diabetes Association

Grupo Body Systems

162 MedTep

241 Omnilife

164 MBP

242 MBP

165 1DOC3

243 MBP

166 MBP

245 MBP

168 MBP

246 Medtronic

168 MBP

250 MBP

170 MBP

251

172

Mexican Diabetes Association

252 Brudifarma

172

Global Health Intelligence

253 MBP

iStock, ProMéxico

174 Galderma

253 MBP

180 MBP

254 MBP

180 MBP

256 MBP

182

257 MBP

RM Pharma

184 MBP

258

Distribuidora Levic

185

Inventiv Health

259

R.H. Shipping

186 MBP

261

World Courier

187 MBP

262

Grupo Marzam

188 MBP

264 MBP

189 Accelerium

265 MBP

190 MBP

266 SEFOTUR

192

270

Novo Nordisk

Quintana Roo Medical Travel Association

198 MBP

271 MBP

198 MBP

272 MBP

199

273 MBP

World Stem Cells

200 MBP

274

201 Croda

276 MBP

201 MBP

277

Cancun Oncology Center

202 MBP

278

Fertility Center Cancun

205 UNAM

279 IREGA

206 Scantibodies

280 MBP

207 MBP

282 MBP

208 MBP

283

Centro de Oftalmología Monterrey

209 RegenerAge

284

Hospital San José

210 Sesderma

285 CostaMed

216 MBP

286 Dentistar

218 MBP

287

219 Sesderma

288 Hays

Centro de Oftalmología Monterrey

Coral Dental Center


292

McKinsey & Company

303 MBP

294 MBP

304 MBP

295 PwC

305 MBP

296 MBP

306 MBP

297

308

Baker and Mckenzie

Bacher Zoppi

298 MBP

309 MBP

299 MBP

310 MBP

300 MBP

311 MBP

301 Healthlinks

312 Avinet

302 TAPVS

| CREDITS EDITORIAL MANAGER: Tomás Sarmiento

PUBLICATION COORDINATOR: Marta Aguilar

JOURNALIST & INDUSTRY ANALYST: Sophie Murten

PUBLICATION COORDINATOR: Johanna Cronin

JOURNALIST & INDUSTRY ANALYST: Alicia Arizpe

JUNIOR PUBLICATION COORDINATOR: Franco Romero

JOURNALIST & INDUSTRY ANALYST: Ricardo Ibarra

COMMERCIAL DIRECTOR: Jack Miller

JOURNALIST & INDUSTRY ANALYST: Luis Vargas DESIGN DIRECTOR: Marcos González EDITORIAL DIRECTOR: Vanessa Buendía

GRAPHIC DESIGNER: Ailette Córdova

ASSOCIATE EDITOR: Mario Di Simine

GRAPHIC DESIGNER: Vanessa Rocha

COLLABORATOR: Nadine Heir

WEB DEVELOPMENT: Arturo Madrazo

COLLABORATOR: Sara Warden COLLABORATOR: Brenda Salas COLLABORATOR: Alejandra Gómez COLLABORATOR: Gabriela Mastache DIRECTOR GENERAL: Jeroen Posma PUBLICATION ADMINISTRATOR: Alena Lipková ADMINISTRATIVE ASSISTANT: Rebeca Garduño CIRCULATION MANAGER: Ana Cristina Garantón

| PRINTED BY Foli, Negra Modelo # 4 Bodega A Fracc. Cervecería Modelo, Naucalpan Estado de México T:. 9159 2100





$199.00 ISBN 978-0-9968026-3-5

59999>

9 780996 802635


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