The Report Company: What would you say have been the most important changes to the domestic pharmaceutical sector during the Calderon administration?

Dagoberto Cortes: I believe the biggest change has been in generic drugs. These are products that have received federal government support for years, when it was felt that they should have a wider distribution. They were proven to be effective, and of good quality. Eleven years ago, the Generic Drugs Law was published in the Official Journal of the Federation, which meant bioequivalency tests could be carried out on generics. This was the beginning of the change in mindset, because prior to that the view existed that these products were cheap because they weren’t effective or because there wasn’t a way of guaranteeing and registering them. In addition, because these were the drugs given for free in public health institutions, people thought that they weren’t the same as the branded drugs. With time, generics have gained the confidence of patients and physicians.

TRC: Why doesn’t COFEPRIS do the tests?

DC: COFEPRIS is a governmental regulatory agency. It doesn’t have the technological infrastructure to carry out these tests. COFEPRIS invites companies that have clinical pharmacology infrastructure and authorises their facilities so that bioequivalency tests can be carried out, with one condition: that there be no link with any pharmaceutical company in order to avoid favouritism. This provided a lot of certainty to physicians, patients and to end users. Because of this, the term “generic drug” has become a synonym for proven quality. This has meant that generics now have a greater market share. 11 years ago, generics didn’t even make up 1.5% of the private market. By the end of 2011, audits showed that generics now cover 52% of the market. In 11 years they have taken over half of the private market and 80% of the public market. It’s one of the great developments that have taken place in this sexenio.

TRC: What role has ANAFAM had in showing the market that cheap doesn’t necessarily mean low quality?

DC: The role of the association has been to serve as an intermediary for dialogue between the federal government, the healthcare institutions and the end consumers. This 52% of market coverage could have been even higher if a promotional strategy had been orchestrated in the mass media, talking about the advantages and benefits of generic drugs and their role in the treatment of chronic degenerative diseases.

Mexico’s population pyramid underwent a change in structure 20 years ago. Then, the base was made up of young people - 65% of the population was under 35. This pyramid has now begun to invert, and today 35% of the population is over 53. Because of that, chronic and degenerative diseases are becoming a bigger problem.

The epidemiology of the country has also changed. 20 years ago, the main health problems were respiratory and digestive infections. Now the main causes of death are arterial hypertension, diabetes, high cholesterol, cancer, and road traffic accidents. This has led to generics playing a bigger role, as when treatment becomes a problem because the patient can’t pay for drugs; generics offer quality at an accessible price.

Today, the members of our association make 61% of the products consumed in the public market, and around 30% of those consumed in the private market. Thus, Mexican companies have laid the foundations for the future of our country. Their qualities have put us at the forefront of innovation and health, which has resulted in increased life expectancy in our country. 40 years ago, the average life expectancy was 45 and today it’s 72. That’s the proof that all of these technological advances have given us a greater life expectancy.

TRC: Speaking of innovation, how are you working with universities and government bodies in terms of research?

DC: This will undoubtedly have to be a checkpoint with the new government, given that investment in technological research and development is well below the standards of other countries. In Mexico, 0.37% of GDP is invested in R&D. It’s a worrying figure which needs immediate attention, because out of the OECD countries we are ranked in the last places in investment in this area and that is very unfortunate. In the USA, 3.4% of GDP is invested in research. In Mexico there are talented researchers and the necessary infrastructure but no R&D program can be realised without government support. If there is no economic support, investors won’t have the confidence that tomorrow the project will be converted into a marketable product. Therefore it is important to create a link between academia and industry. There’s been a lack of support and incentives to develop a system which allows us to be at the forefront in research and development.

But even without the necessary support, in Latin America, it’s the Mexican pharmaceutical industry which dedicates the most resources to research. Almost half of ANAFAM’s members have programs in association with the leading universities and research centres in Mexico, in areas such as biotechnology. We’re also currently working with genomic medicine without having fiscal incentives, and without having anything that allows us to invest more economic resources, devote more time, and dedicate more researchers to it.

TRC: Biotechnology, and in particular biocomparables, are one of the most important parts of the sector. How important is research and manufacturing in this area?

DC: This is without a doubt the most important issue, given that the elderly population has increased and we’re seeing an increase in many metabolic disorders. Treatment with biotechnology products is essential for many illnesses such as cancer, diabetes, AIDS and hepatitis C. In Mexico, 80% of the people who use biotechnology products do so through the national health system.

If there is increasing demand for these products, it’s important that government institutions are more efficient in the management of their budgets, because they’ve never grown beyond the rate of annual inflation, so it’s difficult to imagine that they will be able to offer a service to more patients.

The strategy government institutions are using to increase healthcare coverage has been putting out public tenders for generics, which are now called biocomparables. In July 2009, in the Official Journal, a modification to article 222 of the Health Act was published, which refers to biotechnology products in Mexico. Our country has been the pioneer in the world in legislating on biotech products and biocomparables.

TRC: In your opinion, what opportunities are there for Mexican companies to join international operations?

DC: Today, Mexican companies have access to the international markets, but we need a public policy that gives e institutional support to a company that wants to export, so it receives the necessary chances to accomplish its goals. Exporting nowadays is difficult for Mexican companies due to the amount of paperwork that has to be filled out.

Fortunately, we have a government body called ProMexico which understands that Mexican companies need to export, and it provides a way for them to do so. In this country, we have quality control, talent, well-trained people, manufacturing infrastructure, but above all the know-how of how to work within the requirements of any other country.

Mexico has always had an interest in signing free trade agreements. This can be good or bad, but looking on the positive side, we believe that these represent great opportunities to have a presence elsewhere. Not just in Central and South America, but also in Europe, the Middle East, Asia and the USA.

TRC: From another perspective, with the free trade agreements, how worried are domestic companies about a potential wave of exports from places like China and India?

DC: This is of great concern. The Mexican industry has what it takes to meet the medication needs of the 112m people in our country, we can be self-sufficient. We cannot close the doors to international trade, provided it is selective, because often the doors have been thrown open indiscriminately to imports.

We have spoken with the various authorities to get them to understand the most simple of rules which exist in all bilateral agreements, which is “fairness and reciprocity”, which is to say, I open my doors to you, but you must open your doors to me with the same conditions.

TRC: How do you see the Mexican pharmaceutical landscape in the next five years?

DC: The market for generic products will continue to be consolidated because the country needs products at accessible prices that are above all affordable for the whole population. Very recently, according to official data, the Seguro Popular (popular insurance – a program which provides healthcare coverage) now covers 50% of the population. This program doesn’t buy branded and trademarked products, only generics and if the generics continue to be of quality and are at a competitive price, we will achieve universal healthcare coverage.

The Seguro Popular covers millions of Mexicans who now have access to quality products and to healthcare services, surgery and cancer treatments.