Mexico strengthens regulatory measures
Mexico has the second largest pharmaceutical industry in Latin America, with average gross sales around $9 billion per year,
according to Kiffer. The R&D market in Mexico, like Brazil, corresponds to approximately 5% of the country's total gross sales,
Looking ahead, Mexico's annual growth rate for the pharmaceutical industry is projected to be 11.7% between 2009 and 2014,
and will likely reach close to $14.9 billion, according to BMI.
According to Kiffer, Mexico's pharmaceutical market plays a relevant role in Latin America because it is located in North
America and is closer to the US than any other Latin American country. The proximity allows Mexico to do business with the
US and use the logistics infrastructure available in the region, adds the researcher.
"Mexico has been developing its infrastructure and logistics for research, while good quality universities and [recently]
improved pharma regulations offer opportunities," says Kiffer.
The country's business environment has indeed become more competitive, according to IMS Health. The Mexican government, for
example, abolished requirements for pharmaceutical companies to establish a local plant in order to obtain import permissions.
As a result, public and private customers are no longer forced to purchase medicines from drug manufacturers that have plants
operating in the country.
In addition, according to Espicom Business Intelligence, the number of people accessing public healthcare in Mexico is expected
to increase as the country implements universal healthcare coverage. The change could slow down growth in the private pharmaceutical
sector, but will likely increase the sale of generic drugs. In fact, generic-drug spending is projected to comprise 7.5% (by
value) of the total drug market in Mexico by 2014, according to BMI.
To prepare for this growth, the country lowered its import tax rate and is supporting generic-drug company license deals with
multinational firms. The government is also collaborating more with the US FDA, including by simplifying authorizations for
imported products into Mexico. Additional improvements include the introduction of regulations aimed at controlling the quality
of generic drugs in the country.
Although Mexico is technically trailing behind other countries in Latin America with regard to the generic-drug sector, it
is expected to continue to outrank overall pharmaceutical markets in many other countries in the region.
Hellen Berger is a business correspondent based in São Paulo, Brazil.