Earlier in 2020, PharmaBoardroom sat down with several key stakeholders in the Mexican healthcare and life sciences industry, from the leaders of multinational affiliates, start-up entrepreneurs, association heads, and key opinion leaders. Here, we round up three of their most talked about topics.
Government
One of the most talked-about issues in the Mexican life sciences industry is the healthcare reform set forth by President Andres Manuel Lopez Obrador (AMLO), overhauling the previous Seguro Popular system and centralising the procurement of medical supplies and medicines. The decisions taken by the government have drawn mixed opinions, from outrage over permitting unregulated emergency medicines to a positive outlook on the efficiency of the new system.
President AMLO has put health first. No one can argue with that
Cristobal Thompson, executive director of AMIIF, (Asociación Mexicana de Industrias de Investigación Farmacéutica), the association for research-based pharmaceutical companies in Mexico, spoke with a sense of optimism about the president’s actions and intentions: “President AMLO has put health first. No one can argue with that. We are happy that health is now at the top of the government agenda, and we have to recognize the fact that he instituted universal health coverage so quickly. The idea is that by integrating the existing social security institutions under the newly established INSABI, 20 million previously uninsured people could be integrated into the new system. As an industry, we all agree with that vision and the President has set expectations very high.”
Thompson continued to elaborate on the difficult task ahead of the government, “I believe there is a lot of goodwill in the administration and they are learning quickly. For instance, there was a misuse of funds in Seguro Popular so it is understandable that the government wants to centralize it. However, it is not easy to centrally manage the healthcare of 130 million people. Efficiency is a concern. But we have to applaud President AMLO’s aspirations. His actions reflect his incredible presidential majority of 53 percent and an overwhelming current public approval rating of nearly 70 percent!”
Other stakeholders admit they still doubt the stability of the new system, referred to as INSABI (El Instituto de Salud para el Bienestar – The Institute of Welfare). Rafael Gual Cosio, director general of industry association CANIFARMA elaborated, “There is a lot of uncertainty regarding the role of INSABI. Great promises have been made but the problem lies in the implementation. So far, it has replaced the previous public system of Seguro Popular, which we believe was functioning acceptably well, and today under INSABI, it is not clear what the rules of engagement are regarding the role of the state governments in healthcare provision for their citizens.”
Cosio contrasted the new system with the previous Seguro Popular system, “Previously, the state governments were in charge of providing health services to their own populations and Seguro Popular was the federal institution financing the states’ healthcare expenditures. Presently, the federal government has centralized the administration of all healthcare services but the hospitals, the personnel and all the related operations are still those of the states! Therefore, the role of the states is still unclear. In addition to that, the financial question is also unsettled because INSABI is supposed to provide universal coverage but very unfortunately, we do not have enough funds within the system to support free healthcare for all Mexicans.”
Juan de Villafranca, executive director of AMELAF (Asociacion Mexicana de Laboratorios Farmaceuticos) underscored the importance of collaboration between the pharma industry and the government during these uncertain times and the need to bring solutions to the table: “The most important thing is that we need to have clear rules. AMELAF is working very closely with government authorities to find solutions to the current healthcare challenges such as drug shortages. As an industry, we must bring solutions to the government. At the same time, we also have to be very clear in our position.”
Public
Working with the public sector comes with a fair share of risk due to policy shifts and procurement priorities. These risks can appear in the form of drug shortages, access issues, and reduced government expenditure.
Diego Ruiz, CEO of Eseotr3s Pharma warned of possible drug shortages and how his company is preparing to react, “Based on the current public procurement processes, we expect to continue to see shortages in the public sector. This means that we should be ready to provide the necessary products at very short notice and as cheaply as possible but in limited quantities according to each tender, as and when the government announces it. In 2019, this reactive strategy has been rather successful and we expect to continue it in 2020. This also means minimum investment in public sector projects since we cannot do longer-term planning.”
Another risk of working with the public sector, along with shifting policies, is the absence of planning. Marco Ruggiero, general manager of Chiesi Mexico spoke of unintended consequences of a lack of strategic planning, “Of course, in 2019, the external scenario changed with the new government policies. Therefore, within the public sector, we had many new changes, which in themselves are not the problem – the problem is the uncertainties generated by the absence of planning. Unfortunately, the public sector seems to be moving under the principle of ‘let’s change it and see what happens’. This is not the right strategy for the pharma industry because the lives of patients might be affected. A shortage of medicines could generate heavy consequences for patients.”
Total public investment in health is only at three percent of GDP compared to the OECD average of nine percent
Government investment in public healthcare has a heavy impact on pharma companies. Novartis Mexico country president Fernando Cruz expanded on his concerns about Mexico’s commitment to public health and how his company hopes to bring solutions: “As a whole, Mexico is underinvesting in health, with only around six percent of our GDP going to healthcare – and half of that is out-of-pocket, so total public investment in health is only at three percent of GDP compared to the OECD average of nine percent. When you consider that Mexico has a population of 140 million people, of which 90 percent rely on the public healthcare system, Mexico is a highly aspirational market in terms of developing models of partnership with the public healthcare system for long-term sustainability. This is a conundrum not only for Mexico but in most healthcare systems globally. Mexico currently enjoys a demographic bonus with a lot of youths but the society is ageing and we anticipate that 70 percent of the disease burden in the future will come from non-communicable diseases (NCDs). This burden will then be borne by a smaller population of young people. The industry and the system need to work together. In Mexico, Novartis is taking the lead in bringing the private and public sectors together.”
David López García of BioMarin identified access issues when obtaining drugs through public payers, “As a global leader in rare genetic therapies, we typically work with public payers in each country since orphan drugs typically require special funding. This is also the case in Mexico, where we are only present in the public sector. Unfortunately, even after the patients have been identified, the pathways for them to access these therapies can be very long. For instance, for a new patient to access an approved product through IMSS (Instituto Mexicano del Seguro Social, one of the public payers), there are 154 steps for them to complete!”
Years
Another key topic that surfaced in PharmaBoardroom’s interviews in Mexico was the idea of time, especially looking back over recent years in the country’s healthcare industry and the changes that some companies have made in order to stay ahead of the curve. David Lopez García, country manager of BioMarin Mexico – a company devoted to gene therapy for rare diseases – took a look back over his career to highlight the perspective he gained and the changes he has seen in the industry, “I have been working in the healthcare industry in Mexico for 20 years, so I have witnessed the establishment and end of Seguro Popular in 2003 and 2019 respectively. While the idea behind Seguro Popular to cover the healthcare expenses of Mexicans, particularly relating to catastrophic diseases, was good, there were problems with the day-to-day implementation. There was a significant lack of resources so eventually, some thresholds and limitations were put in place to limit healthcare spending, effectively prioritizing some patient groups over others.”
From the day a company submits its dossier to COFEPRIS for approval to the day that the approved drug is available to all patients in the public system is around 4.5 years – for a normal drug. The process for an orphan drug is even longer
García also alluded to time as the principal barrier to access for rare disease patients waiting for treatment, “Research from IQVIA has found that from the day a company submits its dossier to COFEPRIS for approval to the day that the approved drug is available to all patients in the public system is around 4.5 years – for a normal drug. The process for an orphan drug is even longer. This is a big challenge for patients with rare diseases in Mexico.”
David Kershenobich Stalnikowitz emphasized the changes the Salvador Zubirán National Institute of Medical Sciences and Nutrition (INCMNSZ) has undertaken in recent years in order to stay up to date with government priorities and pivot to meet the evolving needs of Mexican patients. As director general of the Institute, Stalnikowitz noted that “a very important initiative we have been working on in the past few years is the development of primary care, which is one of the government’s priorities. Previously, we already had some primary care initiatives such as influenza and Hepatitis B vaccines, but in the past few years, we have been introducing primary care initiatives across different departments within the Institute.”
Kershenobich Stalnikowitz continues, “For instance, within our integrated diabetes clinic, we have expanded our activities to now involve the families of our patients. The latest project, which we are still working on, is the development of a public restaurant through which we can organize several educational campaigns for the public. This focus on the development and subsequent promulgation of primary care initiatives and models has been a significant change within the Institute over the past few years… At the same time, we still need to continue to develop specialty care, which is also one of the Institute’s important functions. For instance, over the past few years, we have consolidated our liver transplant program.”
