Mexico Health Review 2019 by Mexico Business Publishing

2019

â&#x20AC;&#x153;We will make Mexico achieve universal access to healthcare, in a non-segmented way and based on the fundamental pillars of equity, quality and safetyâ&#x20AC;? Jorge Alcocer Varela, Minister of Health

2019 The Mexican healthcare sector has been through a roller-coaster 2019. Budget cuts have limited public sector maneuverability and uncertainty has made many investors cautious regarding short-term expansion and investment plans. While the hurdles have been significant, the Mexican economy remains steady and the local market for pharmaceuticals and medical devices shows promise. The current administration led by President Andrés Manuel López Obrador positioned universal healthcare at the top of the agenda, along with the need to address the rise in chronic diseases and to counterattack corruption in the system.

Among the industry’s buzzwords and phrases at this time of change are Big Data, analytics, innovation and technology interoperability. As Industry 4.0 practices penetrate the health sector, one key hurdle stands in the way: Mexico’s fragmented system, which makes it difficult to share data and achieve the data integration that characterizes Industry 4.0.

Healthcare is also essential for the country’s economic growth. As the industry opens further to private investment, the opportunities are many. Both old and new companies are entering or expanding in the market, attracted by the country’s large population and its changing epidemiological profile, which will only increase the need for new healthcare services. Moreover, many are investing in innovative solutions or technologies to better identify existing challenges and develop comprehensive strategies to solve them, while optimizing resources and keeping bottom lines in the black.

Mexico Health Review 2019 is a comprehensive report on the state of the industry, the key developments that have shaped the past year and most importantly, a signpost for the direction in which this key sector is moving.

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TABLE OF CONTENTS

STATE OF THE INDUSTRY

MANUFACTURING & SERVICE PROVIDERS

HOSPITALS & CARE PROVIDERS

LOGISTICS & SUPPLY CHAIN

RESEARCH & INNOVATION

GENERICS & OTCs

PERSONAL CARE & WELLNESS

HEALTHCARE 4.0

LEGAL LANDSCAPE

MEDICAL DEVICES

FINANCIAL & SUPPORT SERVICES

PHARMACIES & LABORATORIES

LOOKING AHEAD

TALENT & BUSINESS DEVELOPMENT

Zocalo, Downtown Mexico City

STATE OF THE INDUSTRY

The uncertainty derived from the political and economic changes at both the national and international level continues to affect the Mexican healthcare sector, which is still awaiting the implementation of the present administration’s plans and the lines of action that will guide the sector’s development. The health system remains fragmented and high morbidity rates caused by diabetes, heart disease and obesity also remain a public health concern. However, as one of President López Obrador’s flagship projects, the creation of the National Health Institute for Welfare aims to provide care to the entire population to get a little closer to a universal health system.

Mexico Health Review 2019’s opening chapter will provide an overview of the main challenges the industry faced in the previous year and what actions government institutions, industry organizations and companies took to deal with the issues at hand. This section also analyzes the areas of opportunity within the Mexican healthcare market and the best strategies to foster the sector’s growth.

CHAPTER 1: STATE OF THE INDUSTRY

ANALYSIS: Year in Review

VIEW FROM THE TOP: Zoé Robledo, IMSS

VIEW FROM THE TOP: Mauricio Vila, Governor of Yucatan

VIEW FROM THE TOP: Ana Riquelme, AMID

VIEW FROM THE TOP: Oliva López, Minister of Health of Mexico City

VIEW FROM THE TOP: Cristóbal Thompson, AMIIF

VIEW FROM THE TOP: Marcos Pascual, ANAFARMEX

VIEW FROM THE TOP: Emilia López-Portillo, Monterrey Healthcare City Cluster

VIEW FROM THE TOP: Javier Potes, Consorcio Mexicano de Hospitales

VIEW FROM THE TOP: Eric Hagsater, FunSalud

VIEW FROM THE TOP: Viviana Linares, CFM

| ANALYSIS

YEAR IN REVIEW While Mexico’s chronic disease epidemic continues unabated, new hurdles have arisen. The administration change brought with it a new vision to increase access to healthcare that surprised many in the industry. As the sector adapts to the new environment, it should not forget that change brings opportunity

Mexico is the midst of an obesity epidemic that cost the

or looking for new alliances, many in the sector agree that

country MX$240 billion (US$12.43 billion) just in 2017 and

the key to adapting to these changes is innovation.

is now linked to the three main mortality causes in the country: heart disease, diabetes mellitus and malignant

HETEROGENEOUS MORBIDITY

tumors. Furthermore, the country has subdued but failed

One complex reality in Mexico is that it faces an

to vanquish an old foe: infectious diseases, such as measles,

epidemiological duality. “Mexico is an interesting market.

rubella, dengue, Chagas and tuberculosis, continue to affect

Part of it behaves as an emerging market and another as a

the poorest parts of the country.

mature one because the change in the population pyramid is more common to mature markets,” says Américo García,

This complex situation is what the new administration had

Director General of Mexico and Latin America at Apotex.

to contend with when it entered office in December 2018. President Andrés Manuel López Obrador campaigned on

Infectious diseases continue to affect millions of Mexicans. In

the promise of universal healthcare access, a complicated

2018, 24.5 million people suffered from an acute respiratory

issue that mystified previous administrations. “The

infection, 5.4 million from gut infections and 4.3 million

government should provide access to healthcare services to

from urinary infections, according to the General Direction

all, no matter their personal beliefs, socioeconomic status,

of Epidemiology. However, thanks to modern medicine

living conditions or ethnicity,” says Oliva López, Minister

patients can be cured of most of these diseases, which has

of Health of Mexico City (SEDESA). Throughout López

led to lower mortality rates stemming from this category of

Obrador’s early tenure, his administration has sought to

diseases. In 2017, the only infectious diseases to rank among

achieve this goal by eliminating unnecessary spending in

the Top 10 mortality causes in the country were influenza

many areas and addressing corruption,

and pneumonia. Together, these two

which he perceives as the major setback

diseases accounted for 21,892 deaths in

for every economic sector in the country. While the goals seem beneficial, their implementation, and the focus on austerity, has created confusion and uncertainty among players in the public and private sectors. Beyond the hit on

85 million

The number of people who are obese or overweight in Mexico

investment in healthcare, the austerity

2017, which was also several times fewer than deaths from chronic diseases. Heart disease, the leading cause of death that year, represented 141,619 deaths. However, modern medicine has also allowed individuals to live longer. Along with the widespread availability of

measures are proving a hinderance to delivering healthcare

processed foods, these factors have led to the growth

to those who need it. “About 60 percent of healthcare

of a different foe: obesity. Today, 72 percent of Mexico’s

services are provided by the public sector so budget cuts

population is either overweight or obese. The World Health

will have a deep impact. Moreover, demand continues to

Organization (WHO) estimates 85 million people are obese

grow alongside the population. These trends will impact

or overweight in Mexico. Obesity is a risk factor for many

the sector on two fronts: quality and wait times,” says

diseases and is linked to the three main causes of death in

Guillaume Corpart, Managing Director of Global Health

the country: heart disease, diabetes mellitus and malignant

Intelligence. The public sector also is Mexico’s largest buyer

tumors. These diseases are increasingly taking more lives

of medications and medical supplies, so budget reductions

and will continue to do so unless drastic changes are made.

hit these manufacturers and their supply chains. The country’s diverse economic and geographical It is obvious that the country’s healthcare sector will

distribution complicates the provision of healthcare

continue to experience change throughout the coming

services and plays a role in the epidemiological profile of

years. Under these circumstances, the sector is looking for

different regions in the country. The difference in disease

strategies to adapt and to continue growing. While some are

prevalence is fueled by the variation in risk factors that

investing in technology, analyzing new payment strategies

affect each population. “We arrived at the conclusion that

Obrador had the goal of completely reshaping the country

120

largest problems: corruption and irresponsible spending. For many sectors, including healthcare, these policies translated into significant budget cuts that have impacted care providers by limiting the number of medicines,

through the solution of what he considers to be Mexico’s

106.5

98.5

100

105.6

ANNUAL DEATHS CAUSED BY DIABETES IN MEXICO (thousand)

medical devices and equipment they can acquire. They

have also curtailed the number of doctors, nurses and 46.6

20 0

residents. By May 2019, healthcare professionals from the country’s major public institutions at 13 different states

26.8

14.6

had protested the lack of medical supplies and what they called unjustified firings. These problems only make the

1980

1990

2000

2010

2015

2016

2017

administration’s goals of increasing access to healthcare even harder.

Source: Mexican Federation of Diabetes and the Ministry of Health and INEGI

For that reason, some propose that an efficient provision of cervix cancer is more associated with poverty and limited

healthcare requires the support and collaboration of other

access to healthcare. Colon cancer, on the other hand, is

players besides the government. “Individuals will need an

heavily linked to obesity and overweight,” says Abelardo

increased number of healthcare services and current public

Meneses, Director General of INCan.

infrastructure has been surpassed by existing needs. This gap in services needs to be addressed both by public and private

DIFFERENT RISK, DIFFERENT STRATEGY

institutions to ensure access to quality healthcare services

To address Mexico’s complex epidemiological profile, the

by the entire population,” says Paulino Decanini, Executive

current administration wants to migrate to a comprehensive

President of SiSNova. This cooperation will be increasingly

healthcare system that understands the reality of the

necessary as healthcare costs continue to increase.

country. “Focusing on the population’s right to healthcare services forces us to go beyond medical treatment. Health

Unlike acute sickness, chronic diseases require medical

does not equal the absence of disease and should not be

attention and medication throughout the patient’s entire

the responsibility of healthcare providers only,” says López.

life. These costs add up. IMCO states that obesity-related

“Guaranteeing the population’s right to access healthcare

diseases like diabetes can cost between 73 and 87 percent

services requires an analysis of the social determinants or

of all healthcare expenses. The growth of these diseases will

conditions that generate well-being and allow people to have

place a heavy burden on the finances of the public sector,

a fulfilling and fruitful life as individuals, families and societies.”

which provides care for 61 million Mexicans. The sector is already strained for resources – Mexico is ranked second

Every administration enters office with a different vision of

among OECD countries in terms of the lowest investment in

how the country should be run. However, President López

healthcare. The shortages of medications, medical supplies,

HEALTHCARE INVESTMENT AS A PERCENTAGE OF GDP (2018) 20

— Average 15

Source: OECD

United States

Turkey

United Kingdom

Switzerland

Spain

Sweden

Slovenia

Slovak Republic

Poland

Portugal

Norway

New Zealand

Mexico

Netherlands

Lithuania

Luxembourg

Korea

Latvia

Japan

Italy

Israel

Ireland

Iceland

Hungary

Greece

Germany

France

Estonia

Finland

Denmark

Czech Republic

Chile

Canada

Austria

Belgium

Australia

| ANALYSIS doctors and other professionals translate into long wait

the public sector pays only for results. We are talking with

periods at public institutions and unfilled prescriptions.

local authorities to introduce these models, which forces us to ensure that the medications we sell benefit the patient,”

Medication shortages at public institutions are not expected

says Longoria.

to abate soon. The mid-2019 medication tender reduced

maximum prices by 8 percent, which will hurt the already

To provide as much medication as possible to a larger

small margins of bidders. Moreover, in a move that shocked

number of patients, public institutions have focused

the entire pharmaceutical industry in Mexico, the tender was

on the acquisition of generics, which can be up to 80

open to countries with which Mexico does not have free

percent less expensive that the patented medicine. In

trade agreements (FTAs). “These countries manage lower

2019, the federal administration budgeted MX$79.42

prices, which forces local manufacturers to lower their own

billion (US$4.16 billion) for the acquisition of medications,

prices, reducing their margins,” says Corpart. The tender also

according to SHCP. Between 2012 and 2018, COFEPRIS

had no bidders for 62 percent of products, which “will create

approved 590 generic registries to address 71 percent of

a shortage of medications at public institutions that will force

the most common mortality causes in Mexico. This strategy

patients to head to the private sector,” says Rafael Maciel,

saved public institutions MX$26.1 billion (US$1.37 billion),

President of the Mexican Association of Generics (AMEGI).

according to the former Commissioner of COFEPRIS, Julio Sánchez y Tépoz. Now, generics “amount to 86 percent

ROAD TO INTEGRATED HEALTH

of prescriptions in the public sector,” says AMEGI’s Maciel.

Different sectors of the healthcare industry can contribute

Due to their lower costs, generics have expanded to the

to increasing access to healthcare services, medications and

private sector and now, nine out of every 10 medications

supplies. A major concern for both patients and doctors

sold in the country are generics, according to data analytics

is the lack of access to innovative medications. This is a

firm IQVIA.

problem common to emerging economies. “In developed countries, about 10 percent of the population has access

This predilection for generics has allowed the country

to innovative medications. In emerging countries, these

to develop into the world’s 25th-ranked pharmaceutical

are only available to 1 percent of the population,” says

manufacturing industry. In 2017, the country’s production

Ana Longoria, President and Director General of Novartis

was valued at US$4.74 billion and is expected to reach

Mexico. Leaving patients without access to new treatments

US$9.48 billion by 2025, according to ANAFAM. Investing

creates significant problems for patients, who may receive

in generics will facilitate the administration’s goal of

a less-effective medication or no medication at all. While

increasing access to care while keeping budgets in check.

medicines can enter the Mexican market as soon as they are

Mexico’s budget for medication at public institutions totals

approved by COFEPRIS, this certification only makes them

MX$79.42 billion (US$4.16 billion) for 2019.

available at the private sector. Making a medicine available in the public sector requires a much longer process that

Another heavy expense in healthcare are medical devices,

often takes years and does not guarantee availability. Big

whose acquisition may pose a problem considering budget

Pharma aims to address this problem through innovative

cuts. To address the provision of care with smaller budgets,

payment methods that would allow the public sector to pay

technology developers are changing their approach to

not for the medication, but for positive outcomes only. “A

the healthcare sector. “Today, our focus has evolved from

way to fix this is through innovative access models in which

products and services to solutions. Instead of just focusing

MEXICO’S EXPENDITURE ON MEDICAL GOODS (MX$ billion) 400

360

288.3 270.1

280

300.3

292.6

290.5 255.8

240

200

328.4

321.6

320

2010

Source: OECD

2011

2012

2013

2014

2015

2016

2017

Anesthesia machine with monitor

on technology, this new approach has broadened our vision

to a population that can afford to pay for healthcare

by putting patients front and center and integrating our

but has been unable or uninterested in acquiring an

products and services to offer a holistic solution,” says

insurance product.

Carlos Jiménez, Director General of B. Braun Mexico. To address this problem, insurers are developing innovative Other developers have invested in technology to improve

solutions that target overlooked segments of the

efficiency and eliminate redundancies as a long-term

population. For instance, some companies are developing

strategy to keep costs down. For instance, a report from

less-expensive policies that address only one particular

McKinsey states that incorporating AI in healthcare can

disease. Another strategy is incorporating technology to

save companies US$113.7 billion when improving service

increase efficiency. The growing trend of mixing technology

operations and eliminate risks valued at US$23.5 billion.

and insurance, now called InsurTech, allows companies to

Technology can also be a tool for the administration’s goal

use data analytics, artificial intelligence, blockchain and

to increase access to healthcare services. “Technology can

machine learning to improve their operations and improve

allow greater access to specialists to more individuals,

patient retention. While this trend has not yet penetrated

which will be increasingly useful given the rise in chronic-

the Mexican insurance sector, insurers are increasingly

degenerative diseases,” says Marcos Pascual, Commercial

aware of its potential. “Even though the Mexican insurance

Director of ANAFARMEX.

industry has been very traditional and cautious to adopt changes, now it is understanding that digitalization could

Another area that could contribute to increasing

be a fast way to improve the relationship with the end

healthcare access is insurance. However, healthcare

consumer,” says Lara.

insurance has failed to penetrate the Mexican market due to its high costs. “Private health insurance is too expensive

While austerity policies will continue to curtail the

for most Mexicans,” says Eduardo Lara, Head of Health,

healthcare sector, millions of Mexicans will still require care.

Latin America at Reinsurance Group of America. For that

In that sense, cooperation with the private sector can play

reason, only 8.62 million people had a health insurance

an important role in increasing access. “We believe Mexico

policy in 2017, according to AMIS. There is, however, a

has major challenges regarding chronic-degenerative

significant area of opportunity for insurance products. In

diseases and disease transmission. However, we believe

2018, 52 percent of health expenditure was made by the

austerity does not have to be a barrier to achieving the

public sector, 44.5 percent was made out of pocket and

required quality standards in products,” says Ana Riquelme,

only 3.5 percent was made by private insurance. The high

Executive Director of the Mexican Association of Innovative

percentage of individuals who pay out of pocket points

Industries of Medical Devices (AMID).

| VIEW FROM THE TOP

OUT WITH THE OLD, IN WITH THE NEW ZOÉ ROBLEDO Director General of IMSS

Q: What are IMSS’ priorities in terms of health and healthcare?

to guarantee real health rights for all. To achieve this, we

A: Our main goals are to efficiently and effectively implement

will implement actions to increase affiliation and collection

expenditure, achieve better collection, fight corruption and

in proportion to the economically active population.

move toward universalizing medical services in Mexico together with other health institutions. The objective is that

Q: What problems will be solved through the “Agreement

nobody is left without the opportunity to exercise their right

to strengthen access to justice and social security for

to health. From IMSS’ side, we want medical units to operate

workers or their beneficiaries,” signed by STPS and IMSS?

at their maximum capacity for all levels of care, every day of

A: This agreement will allow joint reviews between the STPS

the week and on both shifts. This will allow us to grow our

and IMSS, so IMSS can access more information regarding

patient capacity without the need to build new medical units.

the relationship between workers and their employers.

Technology will be key in increasing access to healthcare.

In case of omitted information, IMSS will analyze the

IMSS will also launch a telephone medical consultation

company’s processes to determine the correct classification

service, home care and telemedicine. These elements will

for occupational risk insurance and the correct fees derived

be used to expand access to health facilities as they reduce

from it. We want to identify aggressive outsourcing

the need for visits and bed use by up to 20 percent.

schemes that under-declare salaries and thereby affect the contribution base. Finally, we want to have more reliable

IMSS’ directors are also visiting IMSS-Welfare’s rural hospitals

information regarding work-related accidents and other

with President López Obrador. These hospitals provide

useful statistical data.

primary and secondary-level medical care to the population without social security. Employing a preventive approach and

Q: What are IMSS’ major achievements to this day?

a comprehensive healthcare model based on medical care

A: Among the most important achievements is the significant

and community action will allow more than 13 million people

reduction in the mortality rate of women due to pregnancy

from remote communities in the country to receive treatment.

and the 50 percent reduction in the risk of death for children due to infectious diseases. We have also moved forward

Q: What are your main objectives as head of IMSS for the

with population changes. In recent years, services have

next six years?

been adapted to new conditions characterized by an aging

A: Historically, IMSS has always supported Mexico’s

population. PrevenIMSS was created to promote health and

population and we are proud to do our part, strengthening

timely detection of chronic diseases. However, we continue to

what works and has worked and returning to the institute’s

address other health matters at the same time. We improved

founding principle of social security. We want to guarantee

our primary healthcare model and reduced mortality due

that employees have access to quality health facilities,

to cervical-uterine and breast cancer. Vaccination has also

identifying areas of opportunity and evolving to face the

improved and we are seeing better results in reducing the

new realities transforming the country’s health landscape.

risk of dying from cardiovascular diseases.

We will promote a more inclusive IMSS and work every day with a very clear idea: guarantee medical care for all

In the area of transplants, we are the leading public

Mexicans. We must move from the idea of rights on paper

institution. IMSS’ transplant productivity grew by 97.5 percent over the past decade, from 1,728 transplants in 2008 to 3,412 in 2018. This has been possible thanks to the training

The Mexican Institute of Social Security (IMSS) is Mexico’s

of specialists through agreements with several hospitals

leading healthcare and social protection institution. It was

abroad, including Claude Bernard University in Lyon, the

founded in 1943 and combines research and medical practice,

Vall d’Hebrón Hospital in Barcelona, La Paz University

with the administration of social security and pensions

Hospital in Madrid and the Tokyo Pediatric Hospital.

VIEW FROM THE TOP |

YUCATAN A GROWING HUB FOR MEDICAL TOURISM MAURICIO VILA Governor of Yucatan

Q: The state of Yucatan has announced a near US$1 billion

Q: How does the health industry and medical tourism

private investment plan. How will the health sector benefit?

contribute to Yucatan’s economic development?

A: Part of the investment will be allocated to three hospitals

A: Medical tourism produces a significant financial spillover

that are being developed in the state. We expect this will

in the state. To maintain and improve the conditions

help enrich the sector’s offer in Yucatan and strengthen

offered to our visitors, medical tourism’s stakeholders are

the state’s natural vocation for medical tourism, as well as

increasingly working in a more articulated way to provide

endorse it as a leader in this sector in southeastern Mexico.

patients with the best experience.

The first of the investments will be from Winehealth, the

In addition to a wide offer of medical or aesthetic

health and sports corporation. A hospital center devoted to

procedures, this experience includes the support of

medical tourism with a domestic and global focus on sports

facilitators, gastronomy, wellness and culture, which leads

will be constructed through an estimated investment of

to a greater economic spillover, benefiting the entire value

MX$850 million (US$43.8 million). The center will be divided

chain. According to a 2018 Ministry of Health study, Yucatan

into four large units: medical assistance, sports, academic

is one of the few states with the human capital and the

activity and accommodations. This project will generate 800

required and appropriate infrastructure to deliver quality

direct jobs, of which 100 will be doctors. The second will be

services in the sector.

an investment of MX$900 million (US$46.4 million) from Faro del Mayab on a 15,000m2 land parcel. This expects to

Q: What are the priority areas for the state to strengthen

generate 200 direct jobs. The last investment, comes from

public health and its management?

EME Red Hospitalaria with MX$106 million (US$5.5 million),

A: In general terms, our health strategy is to strengthen

32 medical specialties and state-of-the art technology that

prevention, health education and timely disease detection.

will generate 1,300 indirect and direct jobs.

We are working to strengthen medical coverage at the level of primary care to increase medical accessibility. This

Q: What lines of action are being carried out by the Yucatan

government has also created the Médico a Domicilio and

government to maximize the potential of medical tourism?

24/7 Medical programs, designed to increase medical care

A: Yucatan is a great place to invest because of its high

for the vulnerable population.

economic growth rate and its position as the safest state in Mexico. Its geographical location also enables the state

With Médico a Domicilio we take care of older adults, people

to easily communicate with other regions. Yucatan is third

with disabilities, prostrate patients and pregnant women

place in economic growth and according to IMSS, it has the

in their homes. These people receive care through one of

third-lowest unemployment rate at 1.8 percent. The state also

our health brigades. We are present in 40 municipalities,

has the necessary infrastructure and services to exploit its

working for the benefit of families in 60,000 homes. The

potential in medical tourism. Yucatan is easy to access by air,

24/7 Medical program operates in 25 municipalities in the

with Houston and Panama two hours away, Miami 1 hour and

state, benefiting 112,208 people by providing them with

45 minutes away and Colombia three hours away. As a result,

complementary medical attention when the health centers

medical tourists from Central and South America could avoid

in their localities are closed.

flying to Houston or Miami and instead be treated in Yucatan at more affordable rates, with high-quality infrastructure and services. Yucatan has excellent potential for medical tourism,

Mauricio Vila has been Governor of the state of Yucatan since

given its floating population of Americans, Canadians, Cubans,

October 2018. He is a member of the PAN party and was

Colombians and Venezuelans, who make up the state’s

previously Deputy and Municipal President of Merida between

potential market of about 20,000 individuals.

2015 and 2018

| VIEW FROM THE TOP

BETTER DIALOGUE NECESSARY TO IMPROVE ACCESS TO MEDICAL DEVICES ANA RIQUELME Executive Director of AMID

Q: How does AMID contribute to the growth opportunities

exchange with decision-makers in the public sector is also

in the medical devices industry in Mexico?

necessary to understand the needs of authorities and the

A: The association was created 11 years ago to tackle the

sector. We are doing similar work with the Ministry of Finance,

regulatory challenges in Mexico. A significant moment was

pushing to create a differentiation between medication and

when Article 3.76 of Mexico’s Health Law was amended

medical devices in regulation. This differentiation may sound

to require all medical devices to submit for verification

simple, but it is necessary to ensure that mechanisms and

or approval every five years. Our association groups over

protocols for storage, distribution and commercialization are

8,000 entities with specific sanitary requirements, which

adjusted specifically for medical devices.

is quite a burden for sanitary authorities. The association was founded to create a dialogue with the authorities to

Q: How can the medical devices industry contribute to the

improve cooperation in this area. Now, we also work on

government’s austerity measures?

organizing consolidated purchases for medical devices.

A: We applaud the government’s austerity efforts and actions to combat corruption. At the same time, we believe

Q: What are the biggest challenges and opportunities for

Mexico has major challenges regarding chronic-degenerative

the sector in the near term?

diseases and disease transmission. However, we believe

A: The primary challenge for medical devices in Mexico is that

austerity does not have to be a barrier to achieving the

domestic consumption is much lower in comparison to other

required quality standards in products. Investment in medical

medical goods, such as medications. Low consumption means

technology could result in better attention to patients, better

not every patient has access to advanced technologies. Mexico

results in public health and a lower sanitary risk. We want

is the main exporter of medical devices in Latin American and

to be allies to the government to help them ease device

eighth worldwide. However, in domestic consumption we rank

purchases and to make the right choice of innovative

between 43 and 48 place. This means there is a big gap

products to ensure the well-being of the population.

between the fast development of the medical devices industry in the country and actual access for the general population.

Q: What actions and strategies does AMID implement to

Since 2016, our agenda has focused on three main goals:

promote innovation?

reaching the highest international standards for medical

A: Since 2016, we have been running an education

devices, working with decision-makers in the industry to

campaign to promote the benefits of medical devices

adopt the latest technology and collaborating with authorities

for people’s health. Equally, we aim to generate dialogue

to help them with tenders for purchases of medical devices.

between industry decision-makers and health professionals who treat the Mexican population. Cooperation is a very

Q: What is needed to increase safety in medical equipment?

important theme and we help strengthen it with a rigorous

A: The first step is to improve cooperation between private

code of conduct based on international standards. This

companies to increase access to medical devices. AMID wants

ensures that clients use technology that satisfies their needs

to accomplish this by working with other associations and

and that end results lead to the maximum benefit for all.

entities to create a united front. We support the General Health Council’s efforts to improve dialogue. More information

Q: What are AMID’s three main goals for the next two years? A: Our primary goal is to accompany the government in its efforts to fight corruption and we are fully available to

The Mexican Association of Innovative Medical Devices

collaborate in this area. This year, we are preparing a training

Industries (AMID) gathers global leaders in innovation of

course for more than 300 distributors and intermediaries who

medical devices and diagnostic systems to work toward the

are members of the association. We want to orient them in

advancement of health services in Mexico

AMID’s new ethics code, which is based on fighting corruption.

VIEW FROM THE TOP |

HEALTHCARE A FUNDAMENTAL HUMAN RIGHT OLIVA LÓPEZ Minister of Health of Mexico City

Q: How is your vision of a comprehensive healthcare system

at Your Home). Another project, Salud en tu Escuela (Health

shaping Mexico City Ministry of Health’s (SEDESA) policies?

at Your School), focuses on enforcing existing regulations that

A: Focusing on the population’s right to healthcare services

limit the advertising of junk food and sugary drinks at schools

forces us to go beyond medical treatment. Health does

and encourages the use of fresh, non-processed foods for

not equal the absence of disease and should not be the

students. Our model will continue to provide care to those who

responsibility of healthcare providers only. It is a much

need it but at its core, the model aims to promote preventive

broader concept. Guaranteeing the population’s right

measures from an early age to reduce the number of people

to access healthcare services requires an analysis of the

who need medical attention for a preventable disease.

social determinants or conditions that generate well-being and allow people to have a fulfilling and fruitful life as

SEDESA handles many different responsibilities, including

individuals, families and societies.

monitoring infectious outbreaks and organizing vaccination campaigns. We have also developed specific programs for

Our scope for healthcare is broad because it tackles

homeless people, inmates and immigrants. Our priorities in

every step between health determinants to provide

the short term include the timely supply of medicines and

medical attention when necessary, including medical care,

doctor availability. We must also ensure quality in healthcare

rehabilitation and companionship during the last stages of

services and that individuals participate in all stages of the

life through palliative care and support for a dignified death.

process, from prevention to palliative care. We are also

The healthcare system involves many players but the state is

spearheading sanitary regulation at a local level. Our model

responsible for guaranteeing healthcare for its citizens. The

for primary attention ensures it is universal, integral, cost-

government should provide access to healthcare services to

free, intercultural and decentralized. Our network comprises

all, no matter their personal beliefs, socioeconomic status,

210 health centers, 17 specialty clinics and 32 hospitals. This

living conditions or ethnicity. While some question whether

year, our budget is close to MX$10.6 billion (US$556 million)

we should provide healthcare to immigrants, healthcare is

and we manage about 30,000 employees.

a fundamental right and we have to provide it to everyone. Q: What role will the private sector and doctors at points Q: How is the ministry ensuring proper access to healthcare?

of sale play in the future of the healthcare system?

A: We are developing a plan to connect the capabilities of

A: Doctors at the point of sale address an existing need.

all federal ministries in charge of providing access to other

Mexico City has many private hospitals and clinics but those

health determinants, including access to a job, drinkable

services are not economically accessible for most of the

water, food, a place to live and a peaceful environment. All

population. Healthcare is a fundamental human right so

these determinants are necessary for a person’s well-being.

it cannot be subject to economic capabilities. However, we can create synergies in some cases. For instance, we

To bring everything together, we are introducing a system

are developing an agreement with a private hospital with

called Salud en tu Vida (Health in Your Life) that will provide

extremely specialized capabilities that are not available in

a holistic service for primary care. This system strives for

the public sector. This agreement will allow our patients to

social transformation through the use of state resources to

receive the care they need.

provide healthcare. The system will be based on a network of service providers that will adapt their actions to individual regions. Salud en tu Vida will offer specialized services for

Oliva López was appointed Minister of Health of Mexico City

individuals in different stages of life. It includes home visits

in December 2018. She has a master’s in social medicine from

from doctors, especially to seniors, terminal or handicapped

the Autonomous Metropolitan University (UAM) and a Ph.D. in

patients, under the program called Salud en tu Casa (Health

public health science from the National Institute of Public Health

| VIEW FROM THE TOP

R&D LEADS TO SUSTAINED, INCLUSIVE GROWTH CRISTÓBAL THOMPSON Executive Director of AMIIF

Q: What are AMIIF’s near-term priorities?

Q: How is AMIIF’s work in clinical research helping Mexico

A: AMIIF delimited a strategic plan in 2014 and though

reach the Top 10 in R&D globally?

we continue to make small adjustments, we have three

A: When AMIIF was created in 1950, life expectancy in

defined axes: boosting access to innovation, optimizing

the country was 49.7 years; today, we live, on average, for

the impact innovation has on social development and well-

75.4 years. This increase in life expectancy can be linked to

being and incorporating social issues into AMIIF’s agenda.

the impact of vaccinations, antibiotics and other types of

Creating more benefits for patients through pharmaceutical

medications. OECD-member countries normally have higher

innovation has been our priority but we have a debt to

health expenditures and a higher life expectancy of 80 years,

society that can only be met by incorporating social issues

such as Switzerland, Spain or Japan.

into our agenda. We believe there is a great opportunity to introduce more We are participating in one of the president’s flagship

innovation and foster the development of medicines in Mexico.

programs, Jóvenes Construyendo el Futuro (Young People

For instance, when a new cancer drug is approved by the

Building the Future), which targets people between 18 and

FDA, it takes COFEPRIS 56 months in average to approve it

29 years of age who were neither working nor studying.

for use in Mexico. Canadians take two and a half years, while

We are proud to say that 35 of the first 200 companies

the average for the OECD is 18 months. Being able to provide

that joined the program were AMIIF members. We believe

this early access is fundamental.

this is an exceptional initiative and we have even been recognized by CCE for the support and enthusiasm we

Q: What will be the government’s role in promoting

bring to the program.

clinical research? A: We hope public investment in health grows to 1 percent

We are also working on programs that improve access to

of GDP during this federal administration, as was promised

health services, exemplified by our work at the Esquipulas

during López Obrador’s campaign. Although we understand it

clinic. This is a primary attention facility that provides

will not be easy, it is important to do it and we hope to see this

services to the indigenous population in Chiapas. The idea

increase reflected in the next federal budget starting in 2020.

is to implement this successful experience of providing

Annually, the industry invests US$141 billion in clinical research.

medical attention to vulnerable populations in other areas

The Top 15 companies in the market invest around US$100

of the country. As part of CCE’s commitment to help the

billion of that amount. The industry still has the potential to

president tackle extreme poverty, we have also reached out

attract significant investment to the country. Moreover, every

to CONEVAL to analyze the places where this vulnerable

job generated in clinical research generates 4.4 indirect jobs,

population is located and the possible actions we could take

which means that this sector generates an economy in itself.

to eliminate the conditions that generate poverty. This is a

Every additional peso invested in clinical research generates

CCE initiative but we want to participate in areas where we

MX$1.67 in revenue. In Mexico, AMIIF’s members invest a little

can provide more support. It is challenging but we definitely

over US$300 million, which is a low number and even though

have to be a part of it, even though our participation might

we could double it, US$600 million would still be insufficient.

not be necessarily related to the pharmaceutical industry. Mexico needs to venture into research and attract more investment. To foster this, there are legislative changes we Research

could make as a country. For instance, Argentina just passed a

Industries (AMIIF) represents more than 60 national and

law that states that any clinical study petition is automatically

international pharmaceutical companies committed to the

approved if it has not been resolved after 30 days. Brazil is

development of new medicines and therapeutic solutions

also working to accelerate clinical studies.

The

Mexican

Association

Pharmaceutical

VIEW FROM THE TOP |

PHARMACIES AN INTEGRAL PART OF THE HEALTHCARE SYSTEM MARCOS PASCUAL Commercial Director of ANAFARMEX

Q: How is the pharmaceutical sector evolving following the

prescription medications. However, Mexican law forbids

change in federal administration and how are pharmacies

selling medications that are not regulated by the Federal

addressing these changes?

Health Law. The new administration should develop a

A: The entire healthcare ecosystem is going through a

regulation that allows for the creation of a competitive

transition period due to the change in federal administration.

environment between physical and online stores. Medicines,

While the healthcare problems present in Mexico during

due to their complexity, require specialized handling that

previous administrations continue, the new administration

can only be provided at pharmacies. All medications should

discovered new problems that were unaccounted for. The

be kept at specific temperatures and those who handle

federal government, through the Federal Superior Audit,

medications should be fully aware of their fragility and

discovered a misappropriation of MX$11 billion (US$577

proper care.

million) of healthcare funds by Seguro Popular and other healthcare service providers. As a result, Mexicoâ&#x20AC;&#x2122;s healthcare

Q: Between 60 and 70 pharmacies open every day. Which

system is being restructured.

pharmacy business model is the most successful? A: Pharmacies are a key player in medical attention, which

Mexican pharmaceutical companies are aware of the situation

has led to the continuous growth of pharmacy chains,

and are highly invested in the definition of these policy

such as Farmacias Benavides, Farmacias Guadalajara and

changes so the federal government can finish establishing

Farmacias del Ahorro, which together represent over MX$10

its acquisition strategy. In the mid-2019 tenders introduced by

billion (US$524 million) in sales and employ over 40,000

the federal government, about 68 percent of the medications

people. All independent pharmacies and pharmacy chains

had no bidders, leaving a significant gap of key medications

in Mexico generate jobs for over 400,000 individuals.

that will affect patients across the country. At this point, the

Pharmacy chains deliver the highest growth rates in Mexico.

federal government is aiming to develop its own distribution

Most of these pharmacies are built in major cities, including

networks, which is leading to uncertainty in the sector because

Mexico City and its metropolitan area, State of Mexico,

the government does not have the necessary infrastructure.

Guadalajara and Monterrey.

We expect pharmacies with doctors next to the point of sale, of which there are 18,000 in Mexico, to continue offering

Q: What trends are you seeing in the market and how can

primary attention. These doctors are writing over 400,000

pharmacies better support the healthcare system?

prescriptions per day and the number will continue growing.

A: The consumer now welcomes doctor consultations at the point of sale, which mostly focus on simple diseases,

Q: How is technology changing the landscape for pharmacies

such as the flu, headaches and stomach problems. We

and which problems and advantages is it generating?

are now heading toward the next stage. Telemedicine can

A: Technology will revolutionize medication distribution.

introduce specialized attention for patients by guiding general

At the moment, most authorities do not accept electronic

practitioners through the necessary procedures. Technology

prescriptions but we are pushing for this to change. Electronic

can allow greater access to specialists to more individuals,

clinical files must also be merged across pharmacies to create

which will be increasingly useful given the rise in chronic-

a single system that can be used by all doctors and points of

degenerative diseases.

sale. This system would provide valuable information to all doctors at the point of sale that would allow them to provide better treatment to their patients.

ANAFARMEX represents close to 15,000 pharmacies across Mexico and it has over 34 years of experience. It specializes

E-commerce platforms, such as Amazon, are also changing

in supporting small and medium pharmacies but it also

the pharmaceutical environment by selling both OTCs and

represents big pharmacy chains

| VIEW FROM THE TOP

COLLABORATION AMONG PLAYERS BOOSTS STATE HEALTHCARE STRENGTH EMILIA LĂ&#x201C;PEZ-PORTILLO Director General of Monterrey Healthcare City Cluster

Q: What opportunities do you see in Monterrey and in the

institutions, including their technologies and procedures, but

state of Nuevo Leon for health innovations?

not their doctors. However, they can help in sharing of good

A: The cluster wants to create synergies between different

practices between hospitals.

players in the sector. With Industry 4.0 taking hold, we are working on attracting startups and institutions to the

We are also working on including pharmaceutical companies

cluster that focus on this topic. We believe there are many

and laboratories that were isolated from the cluster. We

opportunities for innovation in prevention, early diagnosis and

have had a number of meetings to analyze how we can

preventive medicine schemes. There has also been an increase

work together and create a win-win situation. The idea is to

in the number of patient-monitoring apps and those focused

find a way to work together for consolidated purchases or

on helping people live a healthy life.

provide more benefits for hospitals belonging to the cluster. Having pharmaceutical members provides us with another

Q: What efforts is the cluster making to diversify its

differentiator and attracts more hospitals and members to

membership?

the cluster. At the same time, we believe laboratories and

A: We started as a small association for hospitals only.

pharmaceutical companies would greatly benefit from being

Competition between hospitals is very strong, so as a cluster

part of the cluster. Since they do a great deal of research

we need to be a neutral and transparent platform that is

and need to work with patients, hospitals are important allies.

equitable for everyone. But we felt that we were very limited,

These players are in different parts of the country, like Tijuana

which is why we are trying to integrate doctors as well. The

and Guadalajara, but we want to invite them to join the cluster

cluster made significant efforts to promote the strength of

nonetheless. When it comes to the supply chain, we are not limited by geography.

Monterrey Healthcare City Cluster is an association of public

While we are open to including new companies, the cluster

and private hospitals in Nuevo Leon, accredited by national and

is still divided on whether to invite insurance players. These

international organizations as well as the Ministry of Economy

companies have a delicate relationship with hospitals. Still, it

and Labor of Nuevo Leon

is important for them to operate on neutral ground.

VIEW FROM THE TOP |

ALLIANCES CAN HELP CREATE INTEGRATED HEALTH ECOSYSTEM JAVIER POTES Director General of Consorcio Mexicano de Hospitales (CMH)

Q: What strategies has CMH implemented to reach its

The first step we took toward implementing this platform

2025 goal of becoming the most important private health

was an agreement with Laboratorios MĂŠdicos El Chopo in

system in Mexico?

early 2019. With this agreement, we have a combined total

A: CMH provides the widest health coverage in the country.

of about 350 points of contact with patients. Anyone in

However, rather than remaining a group of hospitals, we

need of lab work during nonworking hours can call a joint

want to evolve into a health system where patients can

call center shared between El Chopo and CMH and if the

find a solution to all their health-related issues. The goal

office near that person is not open, access to our hospitals

is to prepare for the future and lighten the public sectorâ&#x20AC;&#x2122;s

is provided at a preferential price.

burden regarding chronic degenerative diseases. This is complicated because it implies that all players must start

Q: How else are CMHâ&#x20AC;&#x2122;s hospitals putting patients at the

working as a team, focusing their new healthcare business

center of their operations?

model towards the patient. At the same time, patients must

A: We see many patients migrating from the public to the

also take responsibility for their own health.

private sector. These patients are added to those we already have who pay out-of-pocket or through an insurance policy.

We have started analyzing how we can best provide

We are talking about a total of 25 million Mexicans, which

the services patients need, looking at different avenues

represents a financial challenge when ensuring all patients

toward easy, economic and fast accessibility. The big

have coverage for their health problems. Even though it

challenge is convincing all players to work together based

seems that this issue does not impact hospitals directly,

on information analysis and standardizing quality and

being able to afford healthcare is a central aspect of the

level of attention across hospitals and clinics. This involves

health ecosystem and the solution must be found among

everything from phone calls to a call center, access to

all players, not only patients.

mobile apps, access to medical appointments adjacent to pharmacies and hospitalization.

One of our priorities is to look for alliances with insurance companies. However, it is not easy, since the financial

Q: How can CMH work to improve healthcare access

sector has an operational trajectory that for many years

and quality?

has been focused on certain segments of the population.

A: Whenever a patient has a health problem, we need to

Insurers do not understand that mid and mid-low

be the first point of contact so we can obtain information

segments of the population have other characteristics

about the problem and start generating solutions. Doctors

and require other types of health plans and suppliers.

should have access to a single medical record they can

They are used to selling an elite product, at high costs and

share with specialists. Moreover, general doctors need to

high premiums. However, these solutions are constantly

have a list of specialists they can recommend to patients,

losing market share. We have been advancing in this

with preferential prices and according to the information

dialogue but we still have much work to do to make

gathered. Patients also need to understand that once they

companies understand the need for more private-sector

are registered in the system, their information automatically

penetration. We have already worked with GNP, Banorte

will be available to all specialists, who will be able to

and Seguros Atlas.

access background information and any other medical consultations the patient might have received. Similarly, patients can access their information from an app at all

Consorcio Mexicano de Hospitales is a group of 38 small and

times. We already have the technology and are in the

medium-sized hospitals distributed across 22 states. Together,

process of strengthening the necessary alliances to ensure

the hospitals have 1,200 beds, 6,000 doctors and care for

implementation.

125,000 patients

| VIEW FROM THE TOP

PREVENTION KEY TO A HEALTHIER POPULATION ERIC HAGSATER Vice President of FunSalud

Q: What are FunSalud’s main objectives?

improvements can be easily implemented. In Aguascalientes,

A: One of our major priorities is preventive care. Our health

we worked with a company with 600 employees to increase

system is primarily focused on curing people who are sick or

its vegetable offering during lunchtime by 30 percent. A

already showing symptoms of a health problem. Healthier

hundred employees also decided to voluntarily accept

lifestyles and early detection of health risks can help prevent

more limited portions. On average, participants lost 5kg

many diseases. Three months ago, the Lancet journal released

and some even lost 30kg. All of them told us how much

an article stating that the greatest cause of disease today

their life had improved, from interactions with their children

is bad eating habits, even more than tobacco, alcohol or

to enjoyment at work. Instead of companies seeing this as

accidents. Conditions related to our diet, such as overweight,

a cost, they should see it as an investment to a healthier

diabetes and high blood pressure, are health problems that

and more productive workforce.

have become increasingly common. If we do not stop this through preventive measures, we are not going to have

Q: What role can the government play in pushing companies

enough resources to treat patients in the future.

to introduce health incentives? A: The government has expressed interest in promoting

Genomics is another area where we see major opportunities.

preventive care. However, the public system is too disorganized

There is a great deal of technology out there, but it is

and seems primarily interested in simply spending money to

dispersed and there is a lack of cooperation between different

gain votes. I believe we can push this topic among companies

institutions and companies. We should come to an agreement

without the need for external incentives from the government.

so that the information we gather can be interpreted and used by all.

Numbers show good health is vital for productivity. AMIIF conducted an analysis of Guanajuato’s automotive industry

We are also working to establish alliances to boost healthcare

and found that absenteeism had led to an average 2

and prevention, one of which is with the Ministry of Agriculture.

percent loss in productivity. Additionally, findings showed a

Healthy practices cannot thrive when vegetables and other

further 7 percent loss due to people showing up for work

healthy products are not affordable for the consumer. Right

in an unhealthy state. Some companies, like PEMEX, have

now, the cheapest products tend to be carbohydrates, which

implemented economic incentives to promote weight loss

incentivizes an unhealthy diet.

among their employees, but I do not think salary incentives are enough to foster a change in culture. That is only achieved

Q: What steps have you taken to promote preventive care?

through positive word of mouth among employees.

A: FunSalud has established an agreement with CCE to improve employees’ eating habits and promote physical

Q: What is the best way for companies to implement health

exercise. Exercise does not necessarily mean jogging or

prevention strategies?

going to the gym, it can also be walking 10,000 steps or

A: To properly assess employee health, a company should

simply using the stairway instead of the elevator. These are

have an in-house doctor or at least an infirmary. Fundación

simple opportunities that can make people healthier. Even

Carlos Slim developed a methodology that allows companies

in companies with hundreds to thousands of employees,

to detect a person’s main health issues through a few simple questions and tests. The foundation trained over 90,000 people in the use of these methods and thanks to

The Mexican Health Foundation (FunSalud) contributes to

new technologies, these can be implemented at a low cost.

scientific and technological innovation in the health sector

Genetics, for example, indicate an employee’s predisposition

through lobbying for public policies, research promotion and

to certain diseases. This information can then be addressed

development of human resources strategies for companies

by health professionals to provide help.

VIEW FROM THE TOP |

PRODUCTION STRENGTH KEY TO ENSURE HEALTH VIVIANA LINARES Excecutive Director of the Mexican Pharmaceutical Council (CFM)

Q: What will be CFM's role in President López Obrador’s

A: APIs are a challenge because of their high dependence

plan for the pharmaceutical sector?

on economies of scale. Without a certain level of production,

A: The industry has grown at a significant rate of 6.9 percent

it is almost impossible to compete with more experienced

between 2017 and 2018. Overall, we see a solid outlook.

countries where there is large production of these

Mexican laboratories have understood the needs of both

substances. Over the years, India, China and South Korea

doctors and patients, continuously adapting their production

have implemented large-scale investments to become

to changing demand. The market is still diversifying, growing

international players in this sector. There are individual API

in number of actors and products. Pharmaceutical players

producers in Mexico, but they have to be selective about

are an important driver for quality employment, generating

what products they make.

more than 86,000 jobs and CFM associates account for over 12 percent of the total employment in the sector.

At CFM, we try to establish communication between industry authorities and research centers to align production goals

It is going to take some time to understand the intentions

and to overcome obstacles in substances procurement. The

and implications of President López Obrador’s policies.

industry needs commonly agreed purchasing mechanisms so

However, the health of the population and demand for

laboratories can have the confidence to invest. Nonetheless,

particular treatments depend on a greater context. All the

in Mexico there are very clear examples of strong products.

decisions taken in this industry are based on a long-term

We have innovated in vaccines, which has led to interesting

vision ranging from five to 20 years. The change in the

developments with potentially big impact. The only limitation

federal government is simply an extra ingredient in the mix.

is that the government is the only buyer. There are also many biosimilars, which have adapted to patients’ needs and grown

Q: What is your view on the government’s intention to

in production. Lastly, the country has produced significant

strengthen universal healthcare?

innovations in medical technology. These developments have

A: Ideally, we should live in a society where health is a

attracted attention and have incentivized exports to other

common service and treatments are readily available. If

Latin American countries, as well as the US and the EU.

the most vulnerable segments of the population can have access to free quality healthcare, that would be utopia by

Q: What other goals does CFM have for 2019?

any government’s standards. Although we focus mostly on

A: First, we think doctors need to regain recognition as crucial

the private market, we do our part in paving the road toward

agents in the population’s health. With so much information

universal healthcare. The government has signaled it wants

available on the internet, many patients have mistakenly taken

more transparency in the sector and our associates have

the decision to self-medicate, which is very risky. Particularly

responded by showing what their production is and what their

when it comes to specialized medication, doctors have the

sales are. Our objective remains to introduce quality and

right knowledge. People should go back to the dynamic of

fairly priced medications to the private market. Ultimately,

consulting a doctor and following their prescription. Our

this is geared toward the long-term ideal of increasing

second goal is to further strengthen COFEPRIS. This is

Mexico’s pharmaceutical production capacity. Prioritizing its

essential to provide laboratories with certainty in terms of

national industry can help a country secure its population’s

regulations and to maintain standards of quality in the industry.

health. Although many countries do not meet the necessary criteria to achieve this, Mexico does, thanks to the size of its population, its qualified workforce and innovative industry.

Mexican Pharmaceutical Council was created in the late 1990s. Its goal is to promote innovation in health sciences and to

Q: Last year you said increasing access to APIs was a way to

strengthen the competitiveness of the pharmaceutical industry

increase access to medication. Is this true also for Mexico?

in the country

Hospital Christus Murgueza, Monterrey, Nuevo Leon

HOSPITALS & CARE PROVIDERS

Hospitals, clinics and other health providers are the main points of contact with patients. Each of these players' mission is to tend to the health of Mexicans, has a value proposition geared toward a specific socioeconomic sector. In a scenario where the patientâ&#x20AC;&#x2122;s well-being is the main concern, hospitals, clinics and care providers are prepared to innovate and stand out in a highly competitive market. Demand for accessible services, state-of-the-art technology and a constant battle with price and cost-efficiency are some of the main challenges that care providers face. Patients, on the other hand, must contend with a saturated public health service and a limited offering for those without health insurance.

The Hospital and Care Providers chapter analyzes how care institutions, providers and doctors are evolving to address patientsâ&#x20AC;&#x2122; needs, maximizing resources, creating much-needed cost-efficiencies and improving access to healthcare.

CHAPTER 2: HOSPITALS & CARE PROVIDERS

INFOGRAPHIC: Hospitals and Care Providers

VIEW FROM THE TOP: Filiberto Álvarez, Centro Médico Dalinde

VIEW FROM THE TOP: Juan Galindo, Christus Muguerza

PROJECT SPOTLIGHT: Wellmedic Health Centers: Medical Tourism

Connecting Mexico’s Specialists to the World

VIEW FROM THE TOP: Rafael Caso, Ginequito

VIEW FROM THE TOP: Alejandro Gil, Centro Médico Puerta de Hierro

VIEW FROM THE TOP: Isaac Ochoa, Clinimed Medical Group

VIEW FROM THE TOP: Fernando Santiago, MAG Medical Group

INSIGHT: Fausto García, Hospital María José Roma

VIEW FROM THE TOP: Gustavo Fernández De Loyola, Grupo Torre Médica

VIEW FROM THE TOP: Alfredo Medina, Hospital Regional de Alta Especialidad de la Península

de Yucatán

VIEW FROM THE TOP: Sven Boes, TecSalud

PROJECT SPOTLIGHT: MAG Medical Group: Access to Healthcare Through

Technology, Personalized Attention

VIEW FROM THE TOP: Patricio González, Hospitaria

VIEW FROM THE TOP: David Kershenobich, INCMNSZ

VIEW FROM THE TOP: Luis Alberto Navarrete, Clínica de Mérida

VIEW FROM THE TOP: Miguel Castillo, Hospital Sedna

INSIGHT: Julieta Domínguez, Hospital DioMed

INSIGHT: Ricardo Cabello, HMG Hospital

VIEW FROM THE TOP: Joaquín Prieto, Hospital Multimédica Norte

INSIGHT: Francisco de Urioste, Sanatorio Durango

| HOSPITALS AND CARE PROVIDERS 0.5 Colima 0.5 Tlaxcala 0.7 Campeche 0.9 Baja California Sur

1.3 Nayarit 1.3 Aguascalientes

550

1.1 Chiapas 1.1 Durango

1.6 Morelos

Size of the sample analyzed

1.1 Oaxaca 1.3 Guerrero

1.6 Zacatecas

1.8 Michoacan

1.8 Yucatan

2.2 Coahuila

21 1. Baja California

3. Sonora

2.2 Hidalgo

4. Chihuahua

2.2 Quintana Roo

2. Baja California South

2.2 Sinaloa 8. Sinaloa

9. Durango

2.4% Tabasco

10. Zacatec

2.5% Queretaro

12. Nayarit

13. Jalisco

2.7% Puebla 3

14 Mexican hospitals have robotic surgery programs; 7 are public hospitals and 7 are private

2.7% Sonora

COLIMA

• 36 percent of hospitals in Mexico have electronic medical records (EMR)

3.3% San Luis Potosi

Number of hospitals

Note: The concentration and number of hospitals and clinics may vary depending on the source. This map was elaborated by crosschecking data from different sources.

3.5% Chihuahua

• 4,000 robotic surgeries have been performed in Mexico • The country has 15 active da Vinci surgical systems.

3.6% Guanajuato 3.8% Baja California

Concentration of hospitals (percentage)

19. Colima

Concentration of hospitals (percentage)

•

Average of hospitals and clinics per state:

8 of every 10 Mexicans have access to health services • The average waiting time for a medical consultation in the public sector is 30.2 minutes

16% Mexico City

According to estimates from the Ministry of Health, there are 4,449 hospitals in Mexico. The following map only considers a representative sample of 550 hospitals based on the cited sources to show a graphic representatioin of Mexico's hospital concentration.

9.8% Nuevo Leon

IMSS is the main health insurance provider in Mexico, covering 29.5 percent of the population 5. Coahuila

Only 40 percent of Mexicans have health insurance

6. Nuevo Leon

9 7. Tamaulipas

7.5% Jalisco

cas

11. San Luis Potosi

14. Aguascalientes

AGUASCALIENTES

15. Guanajuato

16. Queretaro

31. Yucatan

17. Hidalgo

3 18. Veracruz

23. Tlaxcala

21. State of 22. Mexico City Mexico

20. Michoacan

TLAXCALA

26. Morelos

24. Puebla

MEXICO CITY

32. Quintana Roo

30. Campeche

28. Tabasco

25. Guerrero

7 6

27. Oaxaca

29. Chiapas

MORELOS

4.2% Tamaulipas

5.8% Veracruz

6.7% State of Mexico

Source: Consorcio Mexicano de Hospitales, Asociación de Hospitales Privados, Ministry of Health, General Health Council, ISSSTE, Global Health Intelligence

| VIEW FROM THE TOP

STRENGTH IN THE FACE OF ADVERSITY FILIBERTO ÁLVAREZ Medical Director of Centro Médico Dalinde 28

Q: How has the Centro Médico Dalinde hospital evolved

of pocket. We also provide geriatrics services because we

and what is your area of specialization?

treat pensioners from different banks: Banamex, Bancomer,

A: Centro Médico Dalinde is a third-level specialty

HSBC and Santander. At the moment, we cannot increase

hospital. Our most important areas of specialization

the number of patients we receive due to our limited

are traumatology and orthopedics, although we also

infrastructure resulting from the earthquake damage but we

have cardiovascular surgery and a very large area of

are remodeling and expanding. The hospital is also building

geriatrics. In January 2014, the hospital celebrated the

another unit with 35 beds, which we hope will be finished

inauguration of its maternity and pediatrics wing, which

in two years.

greatly increased our capabilities. We developed several maternity packages for deliveries and C-sections that

Our first building turned 73 years old in 2019. Patients

also include different payment plans. In 2013, we assisted

prefer us because we treat them humanely. We are among

around 50 births per month. This number rose to 230

the top private hospitals for occupancy, commonly

before September 2017 but after the earthquake on Sept.

surpassing 80 percent. We have a total of 60 beds in

19 we had to reduce our number of maternity beds to

two buildings and medical attention is divided in three

strengthen other specialties. We now assist 110 births

functional areas: ambulatory procedures, emergencies and

per month.

hospitalizations.

Q: What is the hospital’s investment strategy and what role

Q: What must government organizations do to increase

does it play in increasing the facility’s competitiveness?

access to healthcare?

A: Centro Médico Dalinde invests significantly in imaging

A: The government needs to be more involved in the

and every three to five years we update our equipment

creation of academic programs at public universities

to the latest generation. The center recently invested in a

that address the needs of the healthcare sector. It is also

new 3T magnetic resonance imaging scanner to replace

necessary to unify curriculums among all universities. About

our older equipment We also have positron-emission

20,000 doctors graduate every year from Mexico’s many

tomography (PET) equipment, which is used primarily to

medical schools. However, these schools only have room to

detect cancer. The earthquake on Sept. 19, 2017, damaged

train 8,000 medical specialists, leaving a large number of

the infrastructure of our imaging wing and we are now

general practitioners without the possibility of specializing

reinforcing the buildings before introducing new equipment.

in any area. As a result, the 12,000 doctors who did not

Once reinforced, we will introduce more equipment,

become specialists often have to find employment in

including digital mammography equipment.

other sectors.

Q: What is your client profile and how are you working to

Almost 85 percent of morbidities can be classified as

expand your patient base?

“first level” of attention, another 12 percent as “second

A: We have two major client groups: out-of-pocket patients

level” of attention and the remaining 3 percent as

and users with an insurance plan. Eighty-three percent of

“third-level.” The first level of attention, provided most

our patients belong to the latter group and the rest pay out

commonly by IMSS and ISSSTE clinics, does not receive the necessary consideration from the government and has failed to generate positions for doctors. The solution

Centro Médico Dalinde was founded in 1946 and serves over

would be for the 12,000 graduates without a specialty

15,000 people per year. It is certified by the General Health

to be fully trained as general medical practitioners so

Council and ISO 9001-2015. Its medical units include cardiology,

they can provide care to the 85 percent of patients in

imaging, intensive care, surgery, gynecology and hemodialysis

primary care.

VIEW FROM THE TOP |

SOCIAL PROGRAM BRINGS HEALTHCARE TO THE ENTIRE POPULATION JUAN GALINDO Medical Director of Christus Muguerza 29

Q: What are Christus Muguerza’s strategies to reach as

Q: What are Christus Muguerza’s priorities in terms of

many people as possible?

research and innovation?

A: We are looking to grow our presence in other parts of the

A: At our headquarters in Monterrey, we have a center for

country. At the moment, we are very interested in Merida, a

excellence and innovation that falls under a separate entity

growing hub for health. A new hospital there would serve

within our company called Christus Health. This center’s

not just the Yucatan region but people from the whole

focus is on healthcare services that can be provided outside

southeast. This makes it an attractive location. Another

the hospital, like diagnostics and monitoring. This goes

part of our plan is to continue investing in smaller clinics

together with the opening of our first ambulatory clinic in

for more remote and marginalized communities. Clinics

Monterrey in July 2019.

of this kind are rapidly growing around the country but often without a comprehensive or well-thought out plan.

Last year, together with Skye Group, University of

We can assist them in building a sound infrastructure so

Monterrey and local tech partners, this center participated

they can thrive.

in the launch of a new initiative called Polaris HealthTech. The initiative looks to foster startups in the region

Q: Can you tell us more about your work with foundations

that provide innovative solutions for important health

to provide surgery to patients without resources?

problems.

A: We believe in the idea that the more you give, the more you receive. Therefore, as part of our social responsibility

Q: How has your work on an electronic patient

program, we have several campaigns in which we work

database advanced?

with nonprofit foundations. Generally, the foundation will

A: We have an electronic patient file system from Philips,

come to us with a proposal and we provide the facilities and

which has revolutionized the way we work. This platform

medical team. We are the only private healthcare provider

has allowed us to codify all patient information into a clear

in Mexico with a partnership with Operation Smile, an

system, pulling together a patient’s different conditions to

American charitable organization focused entirely on cleft/

create a panorama of their health situation. At the same

lip palate operations.

time, it considers the costs of our hospital operations. This results in fewer errors and smoother cooperation

Over the course of our five-year collaboration, we have

between different teams. Ultimately, it will also help us to

operated on more than 800 children for free. With the

read the health industry better because we can more easily

support of the International Children’s Heart Foundation,

analyze data.

we are also part of a campaign called Bombeando Milagros, through which we have provided surgery to

At the moment, the system is only available at our hospital

less privileged children who have been diagnosed with

in Saltillo but we intend to replicate the idea at each of our

heart problems.

hospitals over the next three to five years. Although we are still working with commercial partners to install the system,

At our clinics in Chihuahua, we operate on kids with spine

we hope that eventually we can run everything in-house and

problems and have worked with a renowned gynecologist

continuously adapt it to our needs.

to provide surgery to women with a range of issues associated with childbirth. We also offer services in several areas to underprivileged patients, foregoing an upfront

Christus Muguerza started operations in the city of Monterrey in

payment. Instead, we assess their economic situation and

1934 and later joined the CHRISTUS Health system in 2001. The

come up with a financial agreement that makes the medical

group has 11 hospitals, 4 ambulatory clinics and 14 outpatient

intervention possible.

medical centers as well as four social assistance clinics

| PROJECT SPOTLIGHT

WELLMEDIC HEALTH CENTERS: MEDICAL TOURISM CONNECTING MEXICO’S SPECIALISTS TO THE WORLD Wellmedic Health Centers is a pioneering co-working and networking platform for doctors. Its innovative and disruptive model is revolutionizing the health industry in Mexico, offering a complete empowerment platform for health and wellness practitioners that provides instruments and alternatives to physicians, psychologists, rehabilitators, nutritionists and dentists. The platform fosters their exponential growth as entrepreneurs in the health industry. Wellmedic Health Centers started operations in Monterrey, Nuevo Leon in 2016 with its first health center and today it has three units located in the most important areas of the state. In the next five years, Wellmedic Health Centers wants to have 30 locations across the country. Its fourth center is going to be inaugurated in Merida, Yucatan by the end of 2019. Wellmedic Health Centers’ growth will be supported by firstcontact units called Wellmedic CONNECT, located in strategic regions throughout the country. These telemedicine offices will help the company to promote the construction of Mexico’s biggest network of specialists, who can use Wellmedic Health Centers’ facilities wherever the company is present, including the new, international health cluster in Ciudad Mayakoba in Quintana Roo. This project will be the first medical tourism cluster in the Riviera Maya. It will include a medical building with operating and recovery rooms, a hotel for patient recovery and a health market to offer wellness services for the general public and tourists.

| VIEW FROM THE TOP

CONTINUOUS EDUCATION, CLINICAL BEST PRACTICES IMPROVE HEALTHCARE RAFAEL CASO Medical Director of Ginequito 32

Q: How does Ginequito ensure its services provide integral

and infant mortality rate. This is also a common problem

medical care for women and newborns?

nationwide. However, gyneco-obstetric practices and other

A: As a general hospital, Ginequito offers the finest

areas related to maternal and child health have improved

medical attention by complying with quality policies

over the years. Ginequito is part of a public-private initiative

through continuous revision of medical procedures. The

to promote best practices related to maternal and child

hospital is constantly modernizing according to the trends

health. As a womenâ&#x20AC;&#x2122;s health hospital, it is our responsibility

transforming the industry, including humanized childbirth.

and mission to encourage protocols that foster the adoption

It is essential to provide an atmosphere of warmth, safety

of best care practices in Nuevo Leon and Mexico in general.

and quality from attention to infrastructure. Health is not only the responsibility of hospitals. We think Ginequito also follows a teaching-hospital model and has

collaboration among other companies, institutes, insurers,

established important partnerships with universities and the

universities and organizations is essential to create

public sector. We are presently working with the University

maternal and child health expertise. Insurers, for example,

of Monterrey (UDEM) and government-led hospitals on a

are helping us to understand how to make our services

training program that will provide physicians with continuous

more efficient and accessible. The better communication

improvement. One of the best examples of how Ginequito

between the parties, the greater the likelihood of success

combines training and best practices to enhance quality

with procedures, which results in better patient care and a

was the creation of a manual devoted to training doctors,

cost-effective performance for the insurer and the hospital.

gynecologists and obstetricians. Q: How can telemedicine help provide remote Q: What makes Ginequito stand out from other hospitals

gynecological care?

in the northeast?

A: Technology is increasingly important to improve both

A: Ginequito has over 43 years of experience. The hospital

access and quality in healthcare. Regarding maternal and

began with a group of gynecologists who over the years have

child health, Ginequito is in the process of developing a

created an integral model of womenâ&#x20AC;&#x2122;s healthcare. The hospital

digital program that can be used via a mobile device to

offers specialist services that cover the well-being of women

improve the education of our doctors and other health

at different stages of their lives, from youth, through the

professionals. We are going to start our pilot tests with

reproductive stage and pregnancy, to old age. Ginequito even

topics related to pre-eclampsia and we hope we can expand

offers sub-specialty fields, such as gynecological oncology,

it to other issues in the future.

and works with institutions like the Human Conception Study Institute, which was the first fertility center in southern Mexico.

Q: What are Ginequitoâ&#x20AC;&#x2122;s growth and development expectations?

Q: How does Ginequito participate in lowering maternal

A: In the medium term, Ginequito would like to increase the

and infant mortality rates?

penetration of its services. It is vital to implement strategies

A: Despite being among the states with highest growth rates

that improve medical practices and that also keep the hospital

in the health sector, Nuevo Leon also has a high maternal

at the forefront of innovation in the field. We want to create an environment where mother and child feel safe. Another important challenge is how to grow our installed capacity

Ginequito provides health services in northeastern Mexico

to support Monterrey and other nearby cities. Ginequito will

and specializes in medical care for women and their families

continue being a point of reference not only for general and

in gynecology, pediatrics, orthopedics and traumatology,

specialized attention in the mother and child area, but also in

otorhinolaryngology, plastic surgery and laparoscopy

subspecialties that are seeing increasing demand.

VIEW FROM THE TOP |

MAYO CLINIC ALLIANCE HELPS SET NEW BAR FOR TREATMENT STANDARDS ALEJANDRO GIL CEO of Centro Médico Puerta de Hierro 33

Q: What is your specialization and how does it provide

Q: Only 40 organizations globally are allied with the

an added value to your business?

Mayo Clinic. How did you receive this accreditation and

A: Over the past 15 years,, we have developed five

what does it mean for the group?

hospitals. One has become a major center for ambulatory

A: The accreditation process took 14 months. This

surgery. We introduced this model to Mexico from the

involved an intense evaluation and audit of our entire

US and adapted it to the local market. The other four

operations. Certain key components were essential:

hospitals focus on five specializations that require

the focus on providing high-quality care to patients;

hospitalization and major surgeries: neuro, cardio,

the competitivity of our specializations; and our role in

orthopedic, ophthalmology and transplants. In the private

furthering research and education. Additionally, we are

sector, we are nationwide transplant leaders, completing

one of the only two hospitals that offer a seat on our

115 successful kidney transplants per year. The group is

board to the medical faculty at Tecnológico de Monterrey.

developing a network to manage transplants between

The cooperation with Tecnológico de Monterrey involves

hospitals, which entails procuring and distributing the

hiring alumni and maintaining a department for study

organs to where they are needed. This has allowed us

and research.

to transplant multiple organs from the same donor into patients at different hospitals. This year, we also secured

The alliance with the Mayo Clinic will allow us to share

an alliance with the Mayo Clinic in the US, making us the

clinical protocols and experiences between doctors. The

only hospital group in Mexico to have this credential. This

Mayo Clinic treats over 5 million patients a year and it

will help us raise our treatment standards to the highest

has access to immense amounts of information. Being

international levels.

able to combine our knowledge and experience will make treatment opportunities infinitely richer. The main benefit

Q: What is the main challenge facing the transplant

is for the patient; they will be able to access a Mayo Clinic

segment in Mexico, where the number of patients in need

expert for a second opinion at no cost.

of a transplant has increased sharply? A: The principal obstacle is cultural. Certain perceptions

Q: What does your association with the Mayo Clinic

inhibit individuals and families of potential donors from

mean in terms of medical tourism?

donating their organs. It is important to educate people

A: Several of our hospitals are in places that have large

and raise awareness about what they can do.

foreigner and expat communities. People from the US and Canada will recognize our relationship with the

Another issue is having the capability to transport the

Mayo Clinic as a guarantee for quality at a clinical and

organ fast enough. This means having good coordination

service level. We are also thinking of offering treatment

within and between hospitals. What often happens is that

and services to the Latin community residing in the US.

the organ is delayed at the originating hospital due to

People from this community often have family living

administrative and legal procedures. You can facilitate

here and may acquire any necessary medications or

communication in such a way that these procedures

treatments in Mexico. There is an opportunity to create

are processed faster. Internally, for example, we have

compatibility there.

dedicated a great deal of time in developing a team of doctors specifically for transplants. Every hospital has a team for liver transplants, for instance. There is a specific

Centro Médico Puerta de Hierro is a recognized medical

team for a specific organ in each hospital. Our alliance

institution in the western region of the country. It has 5 hospital

with the Mayo Clinic will allow us to share our mutual

units and its standards are recognized by the General Health

experiences and improve further in this field.

Council, the Ministry of Tourism and Ministry of Health

| VIEW FROM THE TOP

INTERNATIONALIZATION OFFERS QUALITY BOOST ISAAC OCHOA Founder and Chairman of Clinimed Medical Group 34

Q: What is Clinimed Medical Groupâ&#x20AC;&#x2122;s role in the promotion

service. We understand that no one wants to be at a clinic,

of medical tourism?

especially in a different country, so our goal is to understand

A: We want to offer a quality service for foreigners already in

how we can best help patients be on their way. Each patient is

the country. Helping patients feel comfortable and providing

assigned one specialized doctor and three nurses, as well as a

them with communication in their native tongue is a key

butler for their family. Despite being a primary care clinic, we

element of this process. Our staff is multilingual and capable

also have an epidemiology unit that generates statistics and

of responding to any urgent and primary care situation in

studies based on the information we collect. This provides us

seven languages. Beyond that, our goal is to be a medical

with a strict epidemiological surveillance that allows us to deal

concierge for our patients, regardless of their nationality.

with changes in the populationâ&#x20AC;&#x2122;s needs, while working in public

Our doctors specialize in urgent response and can provide

policies with the government and international agencies.

patients with the right treatment without them having to come to the clinic if there is no need.

We continuously invest in our personnel so patients know they will receive quality care from our doctors and nurses,

Q: What makes Clinimed Medical Group the go-to option,

who also speak their language. We work directly with 60

not only for foreigners but for all patients?

international insurers and we are trained to work with

A: Our business model is based on three pillars: compassion

all companies from any country, allowing us to be a true

and empathy, state-of-the-art technology and financial

international clinic in Mexico City. Our end goal is to offer

sustainability. We are a 100 percent Mexican company with

quality medical services for clients, especially in remote

an international mindset and we strive to offer a personalized

areas of the country where there might not be immediate access to a hospital or clinic. We have established partnerships with over 1,000 companies and with the

Clinimed Medical Group is an outpatient clinic focused on

government of Mexico City for its school accident program,

medical consultation and minimal invasion procedures for

treating approximately 50 kids monthly. We also collaborate

urgent and primary care. Its facilities include clinical laboratories,

with several international and nonprofit organizations on

CT scanner, ultrasound, X-ray and a rehabilitation center

different projects.

VIEW FROM THE TOP |

NORTHERN MEXICO CITY HOSPITAL SPREADS ITS WINGS FERNANDO SANTIAGO Director General of MAG Medical Group 35

Q: How does MAG Medical Group improve access to

relief for their hospitals and to reduce the number of

healthcare while maintaining success as a business?

postponed surgeries.

A: MAG Medical Group is 5 years old. The hospital specializes in general surgery, orthopedics and neurology

We are also part of the Medical Tourism Cluster of Mexico

but we still offer many other level 3 specialties and we

City, whose objective is to make it a priority for the federal

continue to provide emergency treatment. MAG Medical

government to develop a national program that attracts

Group is spearheading a new medical model in Mexico City.

foreigners seeking affordable medical attention.

There is a large gap between those with private insurance and those who are affiliated with the public sector and do

Mexico City has several disadvantages related to

not have access to specialized care. We have perfected a

medical tourism versus beach destinations but the city

way to provide this latter segment of the population with a

is one of the most important capitals in the world. An

level 3 hospital that is not excessively expensive. We have

appropriate strategy that attracts foreigners and reduces

also worked with insurers to offer more attractive policies.

the perception of insecurity in the city will allow medical

Our goal is to reach 3 percent of that population.

tourism to prosper. We want Mexico City to be the most important destination for medical tourism in Mexico, since

Q: What added value will MAG Medical Group’s new

the city has first-class doctors and the highest hospital

wing provide?

capacity in the country.

A: The new wing will significantly change the way we operate, as it will allow us to increase our capacity and the

Q: What alliances are necessary to ensure MAG Medical

services we offer. MAG Medical Group has 20 patient rooms

Group’s sustainable growth?

and three surgery rooms. The new wing will allow us to offer

A: We are working with Mexico’s largest insurers, including

over 83 beds in total, eight surgery rooms, one hemodynamic

GNP, AXA, Seguros Monterrey, Seguros Banorte and

room, 50 patient rooms, 15 cradles, 11 recovery rooms, six

Seguros Mapfre. About 70 percent of the patients MAG

emergency cubicles and a shock room, five adult intensive-

Medical Group receives are recommended by insurers.

care rooms and six neonatal intensive care rooms. The new

We offer insurers low reference prices that guarantee a

wing will also have an imaging unit that will provide X-rays,

return on investment. We are working with insurers who

ultrasound, tomography and resonance. We hope the new

are betting on our middle-income population model. We

wing will consolidate the hospital and allow us to open more

are also building alliances with laboratories and national

facilities in the country. Some of our doctors were wary that

suppliers to develop joint strategies that will allow us to

prices would increase with the construction of the new wing

open the new wing as soon as possible.

but our goal is to generate a mix of high and medium-priced services. We want our doctors to see MAG Medical Group as

Q: What can other hospitals learn from MAG Medical Group?

a reference of quality and not price.

A: That it is possible to provide healthcare services at affordable prices without neglecting quality and to generate

Q: How is MAG Medical Group working with federal

policies that benefit all players in the healthcare sector,

authorities to improve access to care?

including patients, doctors, brokers, hospitals and insurers.

A: MAG Medical Group participates in several forums with the authorities of the State of Mexico to address health regulation. We have agreements with public institutions

MAG Medical Group is a hospital in Mexico City with capabilities

to address blood supply and the transfer of patients.

for cardiology, plastic surgery, endocrinology and gynecology,

After the change in federal administration, we aim to

among many other areas. The hospital also offers laboratory

continue working alongside public institutions to provide

services, including X-rays, clinical analysis and ultrasound

| INSIGHT

NEW HEALTH MODEL BASED ON COLLABORATION FAUSTO GARCÍA Director General of Hospital María José Roma

Mexico’s epidemiological challenges and aging population are surpassing hospital infrastructure, gradually increasing the strain on health and social security systems, according to Fausto García, Director General of Hospital María José Roma. “Our country is no exception,” he says. “Greater life expectancy and a decrease in fertility will prompt the emergence of chronic-degenerative diseases and other conditions.” The UN’s World Population Prospects Report says the elderly population globally grew at a 1.5 percent annual rate until 2015. By 2050, the rate will be around 3.4 percent. Data from the National Commission for the Retirement Savings System (CONSAR) shows there is a similar trend in Mexico. Until 2015, the population aged 60 and over grew by more than 1.7 percent and for 2050, the rate will be close to 5.6 percent. Under such conditions, high out-of-pocket health spending and a growing population living in poverty conditions will have an impact on the growth of the health sector. García says around 20 percent of Hospital María José Roma’s patients come from insurance partnerships with MetLife, AXA, Banorte, BX+ and Seguros Monterrey. The remaining 80 percent comes from out-of-pocket patients. “It is very difficult to grow in these conditions because hospitals must increase employee salaries while maintaining stable prices, or risk impacting patients without the liquidity to afford them,” he says. “Increasing prices would cause the hospital to stagnate.” García believes the hospital’s development strategy provides greater opportunity to generate revenue before requiring price increases. “Providing more services will attract more clients,” he says. The hospital recently added hemodynamics, hemodialysis and topographies to its portfolio and its goal is to ramp up operations by boosting investment in state-of-theart technology and highly qualified professionals.

VIEW FROM THE TOP |

LOGISTICS METHODOLOGY REACHES HEALTHCARE GUSTAVO FERNÁNDEZ DE LOYOLA Former CEO of Grupo Torre Médica 37

Q: What results have you achieved in your plan to expand

maintaining our low-cost advantage. A low-cost, high-quality

to 10 hospitals and 20 clinics following the hub-and-

model will be essential to address any health issues in Mexico

spoke model?

in the future. That is the next growth barrier for hospital

A: In 2018, we focused on growing the capabilities of our

groups and where Grupo Torre Médica wants to participate.

existing facilities. Our offer grew from 35 to 63 beds in our two hospitals and we are in the process of opening our sixth

Q: What do you think hospitals and healthcare will be like

clinic in Mexico City, which will double our patient capacity.

in 20 to 30 years?

We hope to begin with our expansion process beyond Mexico

A: I think we will evolve in two ways. First, we will predict much

City in the second half of 2019.

sooner when a patient will need attention or will suffer from complications. Predictive technology will have a major impact

In Mexico City, we specialize in traumatology. Annually, we

in Mexico in the next 20 years. Second, once patients have

see over 100,000 patients, from those in simple accidents

a problem, technology will substitute medical and nursing

to patients requiring intensive care. We continue growing

staff. A machine will be able to diagnose many problems with

our patient capacity following our hub-and-spoke model.

greater precision than a doctor, as well as run blood tests and

We have changed the way we relate to our clients and have

imaging studies and correlate them with 10,000 similar cases

established associations with insurance companies to create

from patients in other parts of the world. Doctors will probably

different products to help patients. Rather than fostering a

not be substituted in the surgery room but when it comes to

traditional model where we charge insurance companies when

metabolic issues, a machine will have more information to

patients get to the hospital, we are creating joint programs

make a reliable diagnosis. However, it will take time before

to manage patient populations and lower risk collaboratively.

Mexico adopts these technologies.

We want to share with insurers the benefits of this strategy and also participate in the sale of insurance products. Hospital

Q: What are the main factors impeding the development of

and insurance companies tend to have an antagonistic

skilled professionals in areas like nursing or radiology?

relationship, so our goal is to change that and become allies.

A: Women are increasingly participating in other professions and becoming a nurse is not that attractive anymore. Since

Q: What role do new technologies, changes in user

there are fewer people studying to become nurses, we have

preferences and increasing medical expenses have in your

to provide incentives to attract more people to the profession.

strategy to meet patients’ demands?

Once they graduate, we have to pay them well and offer them

A: Patients are sometimes more informed about the different

incentives to grow in their field.

treatment options available. This is good, however, because it forces hospitals and doctors to update their offering

Regarding doctors, there are some specialties that are in

constantly, including new treatments, technologies and

greater demand than others. At the same time, students are

therapeutic techniques. High costs, on the other hand, remain

more attracted to certain areas than to others. There is an

a complication for patients who do not have the resources to

opportunity to offer positions to doctors of all specialties but

access new technologies.

it is difficult to convince them to move to cities with 300,000 inhabitants.

Q: What does Grupo Torre Médica do to counter these complications? A: Our hub-and-spoke model allows us to perform less-

Grupo Torre Médica is among the most important hospital

complicated procedures in clinics, where costs are lower and

groups in Mexico City, with two hospitals and six clinics, and

attention is faster than in a hospital. Having said that, we have

sixth in the entire country. It offers healthcare services under

improved our hospital system to treat patients faster, while

the hub-and-spoke model

| VIEW FROM THE TOP

UNIVERSAL HEALTHCARE EVEN AT HIGHLY SPECIALIZED LEVELS ALFREDO MEDINA Director General of Hospital Regional de Alta Especialidad de la Península de Yucatán (HRAEPY) 38

Q: How has HRAEPY’s mission evolved since its conception?

Our hospital focuses on tertiary care, which tends to

A: Our hospital’s primary mission is to meet the medical needs

be more demanding in terms of resources. Through our

of people who are vulnerable, socially and economically. This

cooperation with bodies like Seguro Popular, which will

mandate was established in a presidential decree 15 years

soon transform into Instituto Nacional de Salud para el

ago. Our hospital is now celebrating its 11th anniversary and

Bienestar (National Health Institute for Welfare), we can

we follow three main lines of action. First, our goal is to make

offer this expensive care to patients with few economic

medical treatments accessible to the entire population of

resources. However, we must continue looking for ways to

the Yucatan peninsula, covering Yucatan, Campeche and

be efficient in providing care to patients from all segments

Quintana Roo. We offer more than 40 medical specializations.

of the population. This will become especially relevant

Our teams consist of doctors, nurses, paramedics and

now that the Mexican population is aging and chronic

technicians. Second, we want to build a strong health

degenerative conditions are becoming more common.

workforce in the area. This means creating an educational space for professionals in medical specializations and imbuing

Q: What would you say are the main health challenges of the

them with the values of our institution. Our third line of action

Yucatan peninsula and how do you deal with these?

is medical and scientific research conducted by researchers

A: Our country’s epidemiological map is diverse. Diseases vary

at our institution to develop our own clinical studies.

because of different altitudes, climate and cultural factors. Here on the peninsula, we have a high prevalence of kidney

Q: How do you define a population that is economically

stone disease. This is the No. 1 condition in our hospital in

and socially vulnerable and how do you help them?

terms of medical attention and surgeries and if it is not treated

A: In practical terms, 90 percent of our patients do not

on time, it can cause irreversible renal damage and chronic

have access to social security. Through Seguro Popular’s

kidney failure. Should patients get to this point, this can lead

resources, we can provide them with healthcare. They

to other necessities, such as a renal transplant. Our urological

can also be referred to us through other institutions. We

department is experienced in the treatment of prostate cancer,

work with six socioeconomic categories and schemes of

another major cause of death in the country. Our hospital has

payment. One of them is zero, which means that the patient

a thorough program in oncology and cardiology and we aim

is exempt from payment. Categories two and three require

for cardiac surgeries to be minimally invasive. We also treat

limited fees that keep cost at a minimum so they do not

a wide range of chronic degenerative diseases that have a

become a significant financial burden for patients.

strong connection to lifestyle, nutrition and education.

Our hospital is working toward universalization of medical

Q: How does HRAEPY collaborate in the training of medical

services. This means we want to make healthcare as

professionals?

accessible as possible. One way to do this is through

A: We support five medical residencies and three more of

interinstitutional agreements, where we exchange medical

high specialization. Resident doctors learn from teachers and

services between institutions. Bigger players like IMSS and

experts and the programs are also open to doctors who wish

ISSSTE have signed agreements with us to treat patients

to acquire new skills or relearn particular aspects but are not

through coordinated collaboration.

necessarily in the process of obtaining their specialization. Our focus is to provide an integral approach to health. We have a special center where we simulate all kinds of health

Hospital Regional de Alta Especialidad de la Península de

procedures and surgeries. Here, doctors have the space

Yucatán (HRAEPY) is a public hospital based in Merida. Its

to build the necessary experience to become excellent

primary mission is to provide specialized treatments and tertiary

professionals who trust their own skills. We are the only

care to people with a vulnerable social and economic background

regional hospital with this kind of center.

VIEW FROM THE TOP |

UNIVERSITY ALLIANCES STRENGTHEN MEXICAN HEALTHCARE SVEN BOES CEO of Hospitals TecSalud 39

Q: What differentiates TecSalud’s model from other

of Tecnológico de Monterrey is a plus for every partner

hospitals and care providers in Mexico?

because they can see the impact our university and

A: One of our main differentiators is that we are the only

graduates have on our country and around the world.

academic medical center based in Mexico. This gives us

Given that we are a not for profit organization, we can

both the privilege and responsibility to transform healthcare

concentrate on patient care and safety without having to

through research, innovative teaching methods and the best

think of economic factors.

clinical practice. Q: What research areas is TecSalud prioritizing? Q: What is TecSalud’s capacity and what strategic alliances

A: At the TecSalud Research Department, we are moving

has it created to continue growing?

from traditional basic and clinical research into more

A: With more than 220 beds in our two teaching hospitals

innovative and international medical research. We have

and 1,500 physicians, TecSalud attended more than 70,000

seven strategic research groups. Those groups combine

patients in 2018. TecSalud has a diverse range of partnerships

academic and clinical researchers and are supported by

with the goal of transforming the health system as a whole.

our doctoral, master and undergraduate students, not just

An example of this is the international alliance with Houston

from our medical school and health sciences, but also by

Methodist Hospital, which has helped us to adopt international

students from the School of Engineering and the EGADE

practices. In Mexico, TecSalud has partnered with Hospital

Business School. These strategic research groups work on

ABC in Mexico City, Hospital Puerta de Hierro in Guadalajara,

innovative therapies and visual sciences, bioengineering

Hospital CIMA in Chihuahua, the National Institute of Medical

and regenerative medicine, cancer research, cardiovascular

Science and Nutrition Salvador Zubirán, the National Institute

and metabolomic medicine, bioinformatics for clinical

of Cardiology Ignacio Chavez and the National Institute of

diagnostics, human genetics, and metabolic diseases.

Oncology in Mexico City. For our graduate and medical residency programs, we have partnered with private and

Q: How can TecSalud’s research groups help reduce

public hospitals creating a multicenter rotation of students

Mexico’s disease burden?

and residents in the city of Monterrey. Our medical school

A: The topics on which our strategic research groups have

has partnered with various prestigious institutions in North

been working on are the main chronic conditions that affect

and South America, such as Pontifical Catholic University of

the Mexican population, such as heart disease, obesity,

Chile and Johns Hopkins Medicine International. In addition,

diabetes and cancer, among others. Our researchers work

we are working closely with the largest insurance companies,

through alliances with other universities and institutions in

medical suppliers and pharmaceutical companies in Mexico

Mexico and other divisions within Tecnológico de Monterrey

creating a new values-based practice for patients.

researching new ways to impact risk factors of disease that include social, economic and even environmental aspects.

Q: What difference does it make for your partners to work

We think that partnering with those who are working on

with a hospital backed up by Tecnológico de Monterrey?

the same lines of research and not duplicating efforts but

A: In Mexico, there are other healthcare providers that

complementing them, is the best way to develop concepts

are doing extraordinary work but TecSalud’s advantage

that can reduce the disease burden on the Mexican population.

is the capability to combine our clinical staff with faculty and researchers from our medical school. With our main hospitals in the city of Monterrey and the presence of

Tecnológico de Monterrey Health System (TecSalud) is a

our medical school in other cities, such as Guadalajara

growing medical academic center that integrates teaching,

and Mexico City, TecSalud is making an important impact

research and clinical services. It has two teaching hospitals in

on the lives of patients throughout Mexico. Being part

the city of Monterrey and three Medical Schools

| PROJECT SPOTLIGHT

MAG MEDICAL GROUP: ACCESS TO HEALTHCARE THROUGH TECHNOLOGY, PERSONALIZED ATTENTION Since its creation in 2013, MAG Medical Groupâ&#x20AC;&#x2122;s (MAG Medical) offering has been based on the provision of quality services for personalized and patient-centered care. Today, as part of its growth and expansion strategy, the company is increasing its installed capacity. MAG Medical believes the provision of hospital services should have quality and technology as priorities. That is why the company is introducing high-technology at a low cost in its solutions. This has allowed it to quickly penetrate the market and become a benchmark in low-cost health services, which has made insurers feel confident to work with the company. MAG Medical is strongly committed to investing in technology in the different areas of the hospital, which allows its medical community to have the best diagnosis and facilitate the provision of excellent medical care. MAG Medical is also focused on strengthening its participation in medical tourism, by having trained, bilingual staff and adequate facilities.

MAG Medical specializes in general surgery, orthopedics, gastroenterology, bariatrics, plastic surgery, neurology and obstetrics-gynecology One of MAG Medical's main concerns regarding its expansion project is how to grow its installed capacity without compromising its personalized service. However, the company considers its strategy is well-structured and the quality of its services will continue to position the hospital as a key player in the northern part of Mexico City. The hospital specializes in general surgery, orthopedics, gastroenterology, bariatrics, plastic surgery, neurology and obstetrics-gynecology. By December 2019, MAG Medicalâ&#x20AC;&#x2122;s new facilities will include six emergency cubicles and a crash room, 50 rooms (Jr. suites and standard), a short-stay unit, seven operating rooms, 11 recovery rooms, two endoscopy rooms, a hemodynamics room, a laboratory, a blood bank, magnetic resonance equipment, a CT scanner, X-rays, ultrasound equipment and a hemodialysis clinic. The hospital will also provide additional services such as valet and free parking, an auditorium, a cafeteria, a chapel and offices for doctors.

| VIEW FROM THE TOP

GROWTH FOCUSED ON PATIENTS, TREATMENT QUALITY PATRICIO GONZÁLEZ Director General of Hospitaria

Q: How has Hospitaria advanced in obtaining its ISO certification and improving its imaging capabilities? A: We have been working on a unique quality model to comply with ISO standards. Most hospitals tend to follow the General Health Council model and do not focus on ISO matters. In our case, more than obtaining the ISO certification, we are interested in implementing the organization’s methodology. We have already mapped out all the hospital’s processes. It was a really big challenge but it allowed us to have knowledge and control of all operations, following a standard methodology. This also means the hospital cannot implement different processes for existing procedures, unless they are for a new service or involve a completely new task. This focus on processes complements nicely the General Health Council’s approach, since it puts patient safety at the forefront. The General Health Council has international best practices but ISO incorporates more, forcing us to adopt them and go beyond the standard. Regarding the hospital’s imaging capabilities, we have improved our CT scan and resonance capabilities. We acquired a 1.5T MRI scanner that offers really good clarity. Our CT scanner was replaced by a 128-slice model, which puts us among the clinics with the best CT scan capabilities in the country. The 128-slice CT scanner offers top-notch quality, good imaging, less radiation and is effective for making a diagnosis. Doctors have noticed the improvement and they have started recommending Hospitaria to more patients.

Hospitaria opened its doors in 2012 in the northern area of Nuevo Leon. It has 50 beds, five operating rooms, an adult intensive-care unit, an intensive care unit, endoscopy, pediatrics and neonatal areas

VIEW FROM THE TOP |

RESEARCH THE BASIS OF PREVENTION, PROPER HEALTHCARE DAVID KERSHENOBICH Director General of INCMNSZ 43

Q: How has the Integral Attention Center for Diabetes Patients

population. The Research Support Network is the third axis,

(CAIPaDi) impacted the incidence of diabetes in Mexico?

together with INCMNSZ and UIEM, in the development of

A: As part of INCMNSZ, CAIPaDi provides comprehensive

cutting-edge research in relation to diabetes mellitus and its

care with the help of various specialists in ophthalmology,

complications. All three create the necessary conditions for

psychology, orthodontics and many other areas. The center

professionals from the biomedical and academic fields to

is also focused on newly diagnosed patients, meaning those

interact and offer solutions in the diagnosis, prevention and

who have been diagnosed with diabetes mellitus within

treatment of diseases.

the last five years. Over time, complications derived from diabetes increase and make treatments difficult, which is

Q: What is INCMNSZ’s approach to treating chronic

why it is more effective to target patients at early stages.

degenerative diseases through genomics and nutrition? A: Nutrition and genomics are key factors for the prevention

CAIPaDi’s focus is on adherence to treatment through a

of chronic degenerative diseases, such as diabetes. INCMNSZ

preventive and therapeutic approach. The center does not

works on identifying genes related to diabetes susceptibility

only treat diabetes but tries to prevent further complications.

and the metabolic-molecular conditions that can prevent

To help with this objective, INCMNSZ opened a Metabolic

contraction of the disease. Our approach combines genetics,

Disease Research Unit (UIEM) to generate knowledge on

nutrition and micronutrient studies to clarify all issues related

the pathophysiology of diabetes mellitus. The unit conducts

to diabetes. The institute also performs metabolomics studies

research projects at CAIPaDi regarding the most important

to know which genes establish a metabolic precondition to

conditions related to diabetes. Both UIEM and CAIPaDi work

diabetes to look for new ways of treating patients. There are

together as a clinical and metabolic research unit that links

other diseases and conditions with a genetic or epigenetic

prevention, diagnosis and treatment of diabetes mellitus.

component, such as fatty liver and bacterial resistance. INCMNSZ compares these to diabetes to determine if there

Q: What kind of partners supported the creation of UIEM?

is a difference in how different some people react genetically

A: UIEM wants to be recognized as a center of innovation

to the disease compared to others.

and academic excellence in the study of metabolic disorders. INCMNSZ has several collaborators and academic partners

Q: What genetic particularities impact the Mexican

but Tecnológico de Monterrey, in particular, collaborated

population’s propensity to develop nontransferable diseases?

in the creation of this new unit. Other universities, such

A: The human genome is divided according to ethnicities

as UNAM, have also joined the project due to its focus on

and Mexico is a mixture of Amerindian, Asia-Pacific and

research. INCMNSZ’s relationship with the best universities

European gene variations. This combination leads to greater

in the country is proof of the institution’s commitment to

or lesser susceptibility to the development of certain

healthcare, education and research on metabolic diseases.

diseases. Similarly, the possibility of harming the liver and other organs is different for each ethnicity. If other factors

Q: How important is the Research Support Network in

are added to these genetic conditions, such as food and

INCMNSZ’s research studies?

pollution, there is greater understanding on the population’s

A: The Research Support Network gathers different

susceptibility to certain diseases.

specialists and researchers from the INCMNSZ in the areas of bioinformatics, biostatistics, computational biology, molecular biology, genomics, flow cytometry and metabolomics, among

The National Institute of Medical Sciences and Nutrition

others, to support the institute in developing highly specialized

Salvador Zubirán (INCMNSZ) is one of the Ministry of Health’s

studies on physiopathology issues, such as metabolomics and

National Institutes of Health. It provides tertiary-level medical

genomic studies to find alleles of susceptibility in the Mexican

care to adults and specializes in nutrition and internal medicine

| VIEW FROM THE TOP

A HEALTHY POPULATION MEANS A STRONGER ECONOMY LUIS ALBERTO NAVARRETE Director General of Clínica de Mérida 44

Q: How does Clínica de Mérida work to continuously

A: Our patients primarily come from Yucatan, Campeche

improve its health services?

and Quintana Roo and in lesser numbers from other

A: Clínica de Mérida’s goal is to maintain the infrastructure

states or countries, such as the US and Belize. To provide

and resources to provide high-quality medical attention

more services and increase access to healthcare, we have

with the best services. We base our work on professional

opened centers for medical attention and branches for

competence, opportune medical attention, patient

laboratory services at key locations in the city. We also

safety and dignified treatment. In terms of professional

provide discounts for tests and studies and we disseminate

competence, our clinical and administrative teams are

information through social media like Facebook and Twitter

constantly updating their capabilities and knowledge.

and through flyers, radio and television.

Clínica de Mérida continuously looks for a way to improve wait times and other areas of medical attention.

Q: What mechanisms or incentives are required to stimulate collaboration between the public and private

We consider patient safety key to our operations. Although,

sectors to increase access to healthcare?

there is a certain degree of risk inherent in each step of the

A: The challenges for health institutions in Mexico are

healthcare process and adverse events may occur due to

related to globalization, demographic increases, economic

clinical practices, products, procedures or the system itself,

and political changes, the lifestyle of the population and

we carry out strict evaluations to make sure every visitor

technological developments. To improve the national

enters a safe environment. Lastly, we understand that a

health system, it is important to strive for equal access

humane approach provides the highest value in treatment.

to healthcare services for all segments of the population.

We strive to treat our patients and other visitors with

When the population is healthier, we will see better

dignity, respect and consideration.

economic performance and a better home life. The health system reform in Mexico is a continuous process that should

Q: What are your clinical priorities?

be focused on meeting our current needs.

A: Our utmost priority is providing opportune attention and efficacy in patient treatment. This is supported by the

Q: What are your three main objectives for 2019?

constant acquisition and modernization of our medical

A: We want to grow our infrastructure and equipment

equipment. Often, we will introduce equipment that is

to respond to market demands. Secondly, we should

the first of its kind in the southeast region of the country.

successfully adopt communication systems like INTRANET

Regarding our clinical priorities, we offer 36 specializations

and electronic clinical records. Lastly, we want to keep our

and eight sub-specializations. The most common

certifications, more specifically, Distintivo H, ISO 9001:2015

morbidities at our hospital are pneumonia and conditions

and that of the General Health Council. We also want to

that require surgery, be it general, ophthalmological,

renew our Distintivo M certification and obtain a Clean

aesthetic, orthopedic, otolaryngologic or urological.

Energy Certificate.

Q: Where do your patients come from and how are you

We also want to expand our network of specialists, so they

growing the hospital’s reach?

can respond to new diseases and conditions. The clinic is also aiming to be accredited as a teaching hospital for resident doctors and nurses. Regarding our laboratories, we

Clínica de Mérida is a key private hospital in the Yucatan

want to be certified in NMX-EC-15189-IMNC-2015 for quality

Peninsula. The hospital offers 36 specializations and eight

and competence and obtain a certification from the College

sub-specializations. It treats patients from the peninsula, other

of American Pathologists. In the future, we also want to

areas of Mexico and abroad

offer hydrotherapy and build a heliport at the hospital.

VIEW FROM THE TOP |

SPECIALIZATION DRIVES DIFFERENTIATION MIGUEL CASTILLO Director General of Hospital Sedna 45

Q: How have Hospital Sednaâ&#x20AC;&#x2122;s operations improved now

attention. The public sector has done a good job in the

that the hospital offers more specialty services to patients?

developing prevention campaigns. There have also been

A: We are consolidating as an integral hospital focused on

some advances in legislation regarding food with high sugar

high specialization. We have developed a well-established

and fat levels. But there needs to be a joint effort with the

transplant program with an interesting price scheme,

private sector.

which we call Fair Price, to increase accessibility to these procedures. We just performed our second kidney

As a hospital, we are just one link in the chain. This all goes

transplant under the Fair Price scheme.

along with the companyâ&#x20AC;&#x2122;s commitment to have fair prices in laboratory and imaging to make it easier for people to start

We are also growing in the neurosurgery area and in the next

generating this prevention culture. Insurance companies

couple of years we want to focus more on cardiovascular

can also play an important role, since payments related to

conditions. We have already developed a work plan that

chronic-degenerative diseases also impacts them. Inasmuch

includes the creation of a room for hemodynamic monitoring,

as they promote prevention programs among their clients,

a coronary care unit within our intensive care unit and an

they will reduce their costs while helping their clients have

advanced cardio-pulmonary diagnostic clinic. We are also

a healthier life.

about to open our blood bank. Q: How could homecare transform the hospital and Q: What is the hospital doing to address the advance of

clinical market?

chronic degenerative diseases?

A: In the future, hospitals will be focused solely on acute

A: We continue growing our base of specialists and

pathologies; primary attention will happen elsewhere.

subspecialists. The hospital staffs a total of 185 doctors, with

Moreover, if there are prevention and diagnostic areas

most between 35 to 40 years of age and with a strong practical

within the hospital, they will work independently from the

background. This helps because they have incorporated much

hospital. We expect this change will be boosted by the use

of the new technology and medical advances. We are also

of technology and devices such as wearables. Today, you

renovating our facilities. Although the hospital is only 12 years

can know if you are getting enough sleep hours or whether

old, there are areas that require renovation. We revamped

your heart rate is within the normal parameters. In fact,

all our surgery rooms in early 2019 and we are renewing our

doctors can remotely monitor a patientâ&#x20AC;&#x2122;s heartbeat or sugar

entire intensive care unit. We are expanding our facilities to

levels. In the future, this will be even more common. Such

attend more people with chronic degenerative conditions.

changes will generate a great deal of savings for people in general because they will no longer need to go to a

We are also working on issues related to diagnosis and

laboratory and pay for certain tests. Devices will generate

prevention. In Mexico, we need to start focusing more on

this data and doctors will be able to tell patients where

prevention. We already have renewal plans for our diagnostic

there is an anomaly. I expect big diagnostic companies

equipment. We expect to start with these changes in 2020,

will migrate toward a type of coexistence with wearables

beginning with our mammography equipment, MRI scanner

so self-diagnosis becomes more economical and faster

and other equipment currently in use.

without leaving medical expertise aside.

Q: How can health service providers better serve chronic degenerative disease patients?

Hospital Sedna is a private hospital based in Mexico City. Its

A: Communication regarding prevention is important;

services include emergency, intensive therapy, neonatology,

we need to create a culture of prevention. Mexicans tend

ambulatory surgery, endoscopic surgery, imaging, clinical

to wait until they have critical medical issues to look for

analysis laboratory and hemodialysis

| INSIGHT

PRIVATE HOSPITALS CAN DO MUCH MORE TO HELP THE PUBLIC SECTOR

“

There is great demand in the public sector for particular operations and not enough doctors or facilities” JULIETA DOMÍNGUEZ, Director General of Hospital DioMed

The private sector can still step in to target some deficiencies in public healthcare, says Julieta Domínguez, Director General of Hospital DioMed. “Private hospitals close at night and do not have full occupancy,” she says. “Stronger integration between both sectors could significantly benefit both sides.” Despite being categorized as a smaller health institution, Hospital DioMed has been able to provide high-quality surgeries to a diverse range of clients through a more flexible financial model. About 40 percent of clients pay out of pocket, 35 percent are insured and 25 percent of patients are covered by donations from foundations. Domínguez explains that the hospital’s goal is to find a payment solution together with the patient. Part of this strategy is to negotiate with insurers over packages and prices, and to develop workable solutions for people without the resources to access the private health system. “There is great demand in the public sector for particular operations and not enough doctors or facilities. Hospital DioMed could take some of that volume in exchange for sensible costs agreed with the government,” she says. Outsourcing these operations to private parties could end up saving public resources, but so far these kinds of agreements have met resistance. Among the reasons why Hospital DioMed is able to provide specific treatments is precisely because it is a smaller hospital. This allows it to run at a lower cost and target particular areas. The hospital maintains a 24-hour schedule and uses an app platform called Blue Code to coordinate emergency surgeries. “Blue Code allows the team to track each step in a patient’s journey and ensure everything is ready for surgery when they arrive to the hospital,” says Domínguez. Recently, the hospital started sharing this app service with other small hospitals and providing training in its use, a strategy that she says could also benefit the public sector.

INSIGHT |

HEALTH SECTOR MUST OPEN TO MORE HOLISTIC APPROACH RICARDO CABELLO Director General of HMG Hospital 47

To combat future challenges, health institutions must be

staff does not limit themselves to their own roles but partake

more open and seek collaboration both within their field

in a wider range of responsibilities. “Patients may receive

and out, according to Ricardo Cabello, Director of HMG

their medication from the doctor who performed their

Hospital. “Medicine can benefit from knowledge from other

surgery, which leads to more flexible and faster treatment.

fields, too,” he says.

Most activities are managed through an electronic platform that combines different types of information, including data

Seeking a broader approach to attack health problems

from the patient and the hospital alike,” he says.

has many advantages. Ultimately, the goal is to meet people’s needs, says Cabello. These needs are broader

Eliminating the strictness of traditional hospital rules

than pure health complications and they derive from a

can be taken a step further by inviting professionals

multitude of factors, making a holistic approach necessary

from other non-medical fields to contribute to providing

to introduce the knowledge of professionals from various

better healthcare, Cabello says. Collaboration of non-

institutions and specializations. “This bundles expertise

medical parties extends to the government and private

and resources, leading to a more effective and efficient

companies, such as tech startups, educational institutions

strategy,” says Cabello.

and people from all kinds of backgrounds. Improvement of healthcare processes can even be achieved through

HMG Hospital manages its holistic approach in different

the involvement of relatives in the healthcare process,

ways. The hospital has space for up to 150 consultations at

particularly at home. “With new less-invasive surgeries,

a time. However, about 1,400 doctors have the credentials

patients are likely to spend less time at the hospital and

to work at HMG Hospital, which means the facilities are

more time at home recovering. Using state-of-the-art

open to a much wider group of professionals who are not

monitoring techniques to maintain communication with the

necessarily based there. “This requires flexibility but also

doctor allows those around the patient to take on bigger

increases the value the hospital has to offer,” says Cabello.

responsibilities,” he says.

HMG Hospital has a strong reputation in neurological

Technology itself is proving disruptive in healthcare and

surgery, particularly in the area of epilepsy. This expertise

it will eventually change the infrastructure and role of

is showcased and shared at an annual event that takes place

hospitals. However, new methods including a better ability

at the institution with delegates from the US, Europe and

to bundle data and analyze health problems will only

the rest of Latin America. Although this kind of international

increase the effectiveness of dealing with health issues, as

interaction is not unique, it is an example of collaboration

well as maintain quality levels at a more affordable price,

that can strengthen healthcare on a bigger scale, according

according to Cabello.

to Cabello. The hospital has recently established a collaboration with Humanitas University, as well. Through

As chronic disease become more prevalent and Mexico’s

this joint venture, HMG Hospital will build a second building

population starts to age, the burden on healthcare services

that will expedite consultations and ease patient overnight

and providers will only get bigger. Cabello stresses

stays, while creating a space for students to complete their

that limiting the number of staff to what is absolutely

residencies.

necessary and increasing the flexibility of their roles is vital. “Evolution cannot be achieved without being open

Cabello highlights that less hierarchical and clustered work

to new technological advances and more input from those

could also lead to a more integral approach in healthcare.

outside the medical field,” he says. “Combining different

HMG Hospital has attempted to move away from a pyramid

disciplines to tackle major problems is a trend that is

structure to a more horizontal collaboration. This means the

gaining momentum worldwide.”

| VIEW FROM THE TOP

AFFORDABLE CARE PIQUES INSURER INTEREST JOAQUÍN PRIETO Director General of Hospital Multimédica Norte 48

Q: What are Hospital Multimédica Norte’s main

Q: What are the hospital’s investment priorities regarding

capabilities?

technology to provide specialized services in the area?

A: Hospital Multimédica Norte, located in Tlanepantla de

A: In early 2019, the hospital invested in the acquisition

Baz, State of Mexico, turned 22 years old in October 2018.

of a 64-slice tomography machine used for difficult and

It began operations with three beds and grew according to

highly specialized cardiology and oncology diagnostics.

the needs of the area. Between 2017 and 2018, the hospital

We also have hemodynamic equipment – unique to

expanded rapidly from 16 beds to 40 beds, and it now has

the area – used mainly with stroke patients, which has

a medical tower with 40 consultation rooms and more than

demonstrated highly positive results. This machine

60 doctors who provided an average of 30,000 medical

is used to treat problems related to acute myocardial

consultations in 2018 covering many medical specialties,

infarction and for angiology studies.

including gynecology, obstetrics, oncology, traumatology, dermatology, internal medicine and neurology.

We plan to continue investing in the acquisition of new equipment mainly for our surgery rooms, including

Hospital Multimédica Norte also has three intensive

equipment for anesthesia, monitors and operating tables.

therapy units and hosts new medical services such

The hospital has three surgery rooms and a delivery

as the International Heart Center, which provides

room. These are constantly modernized according to

different medical studies including clinical cardiology,

patient needs.

electrocardiograms, 24 and 48-hour Holter monitoring and heart rehabilitation. Our facility is certified by

Q: What alliances does the hospital have with insurers

the General Health Council and has a blood bank,

and what benefits do these partnerships bring?

clinical laboratory, ambulances, physical therapy and

A: The hospital used to focus mainly on uninsured

rehabilitation services.

individuals, which represented 60 percent of our patients, but many insurance companies approached us as we

Q: What were the reasons behind the hospital’s sudden

grew. Now we operate with almost all insurers, including

growth in 2017 and 2018?

Alliance, AXA Seguros, MetLife, Zurich, Mapfre and

A: Demand for medical services grew sharply in the

GNP Seguros. Between 60-70 percent of the patients

northwest of the metropolitan area, including the

we receive come from an insurance company. At this

Atizapan de Zaragoza, Cuautitlan Izcalli, Azcapotzalco

point, we are not working with public institutions and

and Gustavo A. Madero municipalities, as a growing

our alliances with insurers consist mainly of collective

number of people demand better medical services that

policies for corporate employees.

incorporate more technology, particularly in specialties such as internal medicine, pediatrics, surgery and

We work in a market niche that allows us to provide

gynecology. We operate in an area with few hospitals

competitive prices for both patients and insurance

and we have the infrastructure and technology to cater

companies. Until recently, insurance companies easily

to this demand given that most care providers in the

accepted expenses from major hospitals in the area

region are small clinics.

but they have started to heavily curtail this overhead. As a result, insurers have turned to us as we are one of the few larger hospitals in the area that can provide

Hospital Multimédica Norte will turn 23 years old in October

them the service they need at affordable prices. Our

2019. It has over 60 doctors covering 35 specialties. The

goal is to provide high-quality hospital services at good

hospital also has a clinical laboratory, an emergency room and

prices, which we can do both for uninsured patients and

three surgery rooms

insurance companies.

INSIGHT |

BATTLING C-SECTION EPIDEMIC THROUGH HUMANIZATION FRANCISCO DE URIOSTE Medical Director of Sanatorio Durango 49

Although humanized childbirth is widely recommended

Humanized patient treatment is at the core of Sanatorio

by the WHO, not all hospitals or countries have adopted

Durango’s value proposition, in addition to providing quality

this philosophy. Cesarean sections are more than a

service with proper medical infrastructure at affordable

common practice in Mexico, even when unnecessary, due

prices, De Urioste says. “We try to make the patient

to a lack of proper communication from hospitals and the

feel comfortable and safe at all times with a humanized

practices of insurers, according to Francisco De Urioste,

approach to healthcare and childbirth. We have become

Medical Director of Sanatorio Durango. “Insurers normally

a national icon for humanized childbirth and waterbirth.”

do not cover natural childbirth, only cesarean sections,” he says. “To guarantee coverage, parents simply choose

The WHO says there are approximately 140 million

the latter.”

childbirths per year globally. The moment of birth is a critical time for the survival of women and babies and

According to WHO, the cesarean phenomenon affects

Sanatorio Durango recognizes there are necessary elements

several countries in Latin America and the Caribbean. In

that can guarantee a humanized treatment before, during

fact, six of the 10 countries with the highest cesarean rates in the world are in this region. Data from the Ministry of Health show that at a national level, 45 out of every 100 births are performed by C-section. De Urioste adds that in most hospitals, 80 percent of all child deliveries are C-sections. Sanatorio Durango takes a different approach. “At our hospital, only 20 percent of the childbirths we assist are through caesarean section; 80 percent are natural births.” Sanatorio Durango opened its doors to the public 75 years ago. Even though the hospital has sought to grow

“

and after the child is delivered.

Only 20 percent of the childbirths we assist are through caesarean section; 80 percent are natural births” “A humanized birth is not defined by the moment the

its patient numbers by entering therapeutic areas like

baby is born; it must include creating a healthy and safe

cardiology, pediatrics and oncology and has become

environment for both the baby and the mother before and

specialized in areas that include coronary, endoscopy and

after the delivery,” says De Urioste. “This means giving birth

cardiovascular physiology, its focus remains gynecology

in a clinically and psychologically safe environment that

and childbirth.

minimizes risk factors at the beginning and during labor.”

At its start, the sanatorium participated on tenders to

Sanatorio Durango’s goal is to decrease the high incidence

provide health services to companies with a large worker

of deliveries by cesarean section in Mexico through

base. Over time, conditions in the health sector allowed the

education regarding humanized childbirth. The hospital

hospital to collaborate with private clients through insurers.

seeks to promote a positive experience during childbirth

Sanatorio Durango used to have access to banks, such as

and to keep couples informed as a fundamental part of its

Bancomer and Banco del Atlántico, as well as government

humanized treatment. “At Sanatorio Durango, childbirth

institutions like the National Lottery. Market conditions

focuses on the humane treatment of women and avoids

changed, however. Today, Sanatorio Durango works with

making women feel or be seen as a complement to

the vast majority of insurers in the country, serves the Metro

childbirth clinical practices,” says De Urioste. “We hope

workforce and is considered the top private hospital in the

this approach will persuade more women to choose

city for humanized childbirth.

natural labor.”

RESEARCH & INNOVATION

Research remains the fertile soil where Big Pharma companies plant the molecules that will become the medicines of tomorrow. R&D is the mechanism that guarantees the competitiveness of innovative pharmaceutical companies, although it continues to be a decades-long, multibillion-dollar bet with a small chance of a big payout. However, when the bet is successful, returns can reach tens of billions of dollars, making the sector an attractive investment for those who have long-term investment power. Mexico is already a key player in pharmaceutical manufacturing and exports, yet it remains a challenge to get innovative medicines into the hands of the local population. Despite solid regulations, well-trained researchers and a diverse and appealing population, very little clinical research is done in the country.

This chapter will analyze the opportunities and challenges for clinical research and innovative drug development. It will also highlight market opportunities for innovative medicines in a country that is increasingly leaning toward generics.

CHAPTER 3: RESEARCH & INNOVATION 53

ANALYSIS: As R&D Costs Increase, the Industry Must Find Innovative Ways to Bring Them Down

INFOGRAPHIC: Patent Expirations Loom Over Big Pharma

VIEW FROM THE TOP: Rodrigo Puga, Pfizer Mexico

VIEW FROM THE TOP: Ana Longoria, Novartis

VIEW FROM THE TOP: Andrés Bruzual, Roche Pharmaceuticals Mexico

VIEW FROM THE TOP: Alejandro Martín, Mayoly Spindler México and LATAM

VIEW FROM THE TOP: Marco Ruggiero, Chiesi México

COMPANY SPOTLIGHT: IGSA Medical: Challenging the Status Quo in Healthcare

VIEW FROM THE TOP: David López, BioMarin Pharmaceuticals

VIEW FROM THE TOP: Sonia Pérez, UDIBI

VIEW FROM THE TOP: Américo García, Apopharma

TECHNOLOGY SPOTLIGHT: Chiesi: Less Invasive Tech Defeats Old Enemy

VIEW FROM THE TOP: Javier Amtmann, Menarini

VIEW FROM THE TOP: Aude Boclé, Biocodex

VIEW FROM THE TOP: Mauricio Mendieta, Gedeon Richter México

VIEW FROM THE TOP: Vincenzo D’Elia, Laboratorios Alfasigma

TECHNOLOGY SPOTLIGHT: LEI: The Future of Medicine in Advanced Therapies

| ANALYSIS

AS R&D COSTS INCREASE, THE INDUSTRY MUST FIND INNOVATIVE WAYS TO BRING THEM DOWN R&D investment in life sciences continues unabated, leading to record-level pipelines for new medications. However, smaller returns on investment in R&D and a wave of patent expirations may dampen the steady growth of the global pharmaceutical industry

The stage is set to break records for innovative medications.

a therapy with greater success probabilities for this specific

In 2019, pharmaceutical pipelines across the globe included

population is chosen. This allows a more efficient treatment

16,181 new molecules undergoing preclinical or clinical trials

for the diseases they are facing,” says Andrés Bruzual, General

or in the approval and launch process. The number of small

Manager of Roche Pharmaceuticals Mexico.

companies with only one or two molecules in the pipeline is growing but the bulk of pharmaceutical investment in R&D has

Continuous discoveries in the fields of genomics, proteomics

been done by Big Pharma, with the 10 largest investors placing

and related fields have helped fuel medicinal personalization

almost US$80 billion into research. Worldwide pharmaceutical

along with the growing number of wearable devices and

and biotech R&D spending reached US$171 billion in 2018 and

the penetration of Big Data technologies that allow the

it is expected to climb to US$177 billion in 2019, according

constant collection of large amounts of information that can

to Deloitte. While not all molecules in the pipeline will make

measure the impact of a treatment in real time. While there

it to the market, this is the largest pipeline in the history of

are still great strides to be made before tailoring a medicine

the sector.

to the specific genome of a patient, the sector is advancing its capabilities to target specific genetic mutations. While

2018 was also a record-breaking year in the number of FDA

most are in clinical or preclinical stages, they are gradually

approvals, with 59 new molecular entities approved during the

making their way to the market. Personalized medicine is

year. Of these, 64 percent consisted of small molecules and

expected to represent US$87.7 billion by 2023, according

the rest biotechnological products. Highlights of the year’s

to Deloitte.

approvals include Onpattro from Alnyam Pharmaceutical, the first drug to act by RNA interference, and Luxturna by

While the potential to treat diseases that do not have a

Spark Therapeutics, the first in vivo gene therapy that treats

cure is attractive, personalization also represents a common

a specific genetic disorder to cure a specific kind of blindness.

challenge for both patients and the pharmaceutical industry: cost. IQVIA states that biotherapeutics can set

About 56 percent of the approved medications target rare

a patient back more than US$100,000 per treatment.

diseases, a significant leap from 2017’s 39 percent. As rare

Moreover, due to their high specialization, there are very

diseases affect a small segment of the population they had

few target patients. Once a patient is cured, there is no

been mainly overlooked by the pharmaceutical industry, which

continued flow of revenue for the manufacturer.

targeted blockbuster drugs for large patient populations that would result in significant revenues. The trend has shifted thanks to regulatory changes in the US, which hosts 48 percent of companies that perform pharmaceutical

TOP 10 PHARMACEUTICAL COMPANIES BY R&D INVESTMENT (2018) Company

Investment (US$ billion)

Percentage of Revenue

incentives to companies that invest in the development of

Roche

10.98

19.3

orphan drugs. As a result, more orphan drugs are expected

Johnson & Johnson

10.76

13.2

to enter the market, with 4,615 molecules in the pipeline at

MSD

9.75

23.0

various stages of development.

Novartis

9.1

17.5

Pfizer

8.0

14.9

PERSONALIZED MEDICINE

Sanofi

6.96

17.1

Another growing trend in the sector is the shift toward

Bristol-Myers Squibb

6.35

23.0

personalized or precision medicine, which are medicines

AstraZeneca

5.93

27.0

tailored to the needs of individual patients. “Personalized

Eli Lilly

5.31

22.5

medicine aims to bring the correct therapy to the correct

GSK

5.2

12.6

R&D, according to Pharmaprojects. The changes provided

selected population. Based on their genetic characteristics,

Source: FierceBiotech.

TOP 10 PHARMACEUTICAL COMPANIES BY REVENUE (2018) Company

Revenue (US$ billion)

YoY growth (percentage)

Pfizer

53.7

2.3

Roche

45.6

2.7

Johnson & Johnson

40.7

12.1

Sanofi

39.3

7.1

MSD

37.7

12.2

Novartis

34.9

5.8

AbbVie

32.8

16.2

Amgen

23.7

3.5

GSK

Bristol-Myers Squibb

22.6

8.7

Note: The listed revenue does not include revenue from other divisions within the company. Source: FierceBiotech.

required to perform clinical trials, get the medicine approved by regulators, create marketing campaigns and distribute it. The largest announced acquisition in the first half of 2019 was Bristol-Myers Squibb’s plan to buy Celgene for US$74 billion.

BARRIERS TO INNOVATION Once a new drug is approved, there is still a long way for it to access the market especially in emerging economies. “In developed countries, about 10 percent of the population has access to innovative medications. In emerging countries, these are only available to 1 percent of the population,” says Ana Longoria, President and Director General of Novartis Mexico. To enter the Mexican market, every drug requires COFEPRIS’s approval but this is only enough to be available in the private sector. Mexico’s public healthcare network provides care to 61 million of the country’s 129 million habitants and is the largest buyer of medications and medical supplies in the country.

HIGHER COSTS While the pipeline for new molecules is at a record high and

For an innovative medication, being available in the public

pharmaceutical investment continues strong, returns on R&D

sector is nothing short of an odyssey. After gaining COFEPRIS’

investment keep shrinking for Big Pharma due to a significant

seal of approval, a medication must be approved by the

increase in development costs. In 2010, the drug development

General Health Council followed by its addition to the basic

process cost about US$1.17 billion from the development of

list of the intended institution. As the public healthcare system

the medication to its launch to market. By 2018, this cost

is fragmented, the medication should go through individual

more than doubled to US$2.8 billion on average per every

approval processes for each different public institution, which

new treatment, according to Deloitte. The consulting firm

include IMSS, ISSSTE, PEMEX, SEDENA, SEMAR and others.

states the higher cost of pharmaceutical development has

However, being part of a public institution’s basic list does not

contributed to the shrinkage of returns on investment for new

guarantee availability for the general public as 96 percent of

products. While in 2010 a company could expect a 10.1 percent

medications acquired by the public sector are generics.

return on investment for a new molecule, by 2018 this number had decreased to 1.9 percent. The pharmaceutical sector is also facing a looming threat in the shape of patent expiration. This is a constant threat for the pharmaceutical sector as the end of patent protections leads

US$177 billion: global pharmaceutical R&D investment predicted for 2019

to the introduction of less expensive generics. IQVIA estimates that patent expirations will cost Big Pharma US$121 billion

While this is an effective cost-saving measure, it leaves many

between 2019 and 2023. The cure to this problem, however,

Mexicans without access to the medications they need. For

seems clear. “The only way to address the challenge from

that reason, pharmaceutical companies are increasingly

generics is through innovation,” says Vincenzo D’Elia, General

investing in the development of new market strategies that

Manager of Laboratorios Alfasigma. “When a company

allow greater access to innovative medicines. “A way to fix this

constantly develops new products with a differentiated value,

is through innovative access models in which the public sector

it will find a more effective way to compete in the market.”

pays only for results. We are talking with local authorities to introduce these models, which forces us to ensure that the

Innovation is not limited to the lab. Pharmaceutical companies

medications we sell benefit the patient,” says Longoria. “This

are increasingly investing in alternatives that streamline

will be increasingly important with the arrival of personalized

research efforts, including, but not limited to, artificial

medicine.”

intelligence, automation and machine learning. Big Pharma is also acquiring innovation through M&As. This process allows

Through innovation, new medicines may be able to find a

large pharmaceutical companies to avoid the costs of early

welcoming market in Mexico as the country’s rate of chronic

stage R&D, which also has a high rate of failure, and to bet

diseases related to obesity and aging continues to climb.

only on promising products developed by smaller companies.

“The combination of precision diagnostics and personalized

Unlike these smaller companies, once it has identified an

treatment will undoubtedly have a positive impact on Mexico’s

interesting target, Big Pharma can finance the large investment

most prevalent diseases,” says Bruzual.

| INFOGRAPHIC

PATENT EXPIRATIONS LOOM OVER BIG PHARMA

Innovation is at the core of every pharmaceutical

according to Deloitte. These investments are necessary

company’s success. With expiration for major blockbusters

as the cost to bring a new medicine to market can run

looming ahead, a strong pipeline of new products is

up to US$2.17 billion. The sector will face significant

key to sustaining growth. Globally, pharmaceutical and

challenges, as patent filings and the introduction of

biotech companies spent US$171 billion in R&D in 2018

generic alternatives are expected to cost the industry

and are expected to spend US$177 billion during 2019,

billions during the coming years.

MOLECULES APPROVED BY THE FDA IN 2019 (as of May 23, 2019)

VYNDAQEL

SUNOSI

MAYZENT Tafamidis Meglumine

Solriamfetol

Siponimod Excessive sleepiness in patients with narcolepsy

Relapse of multiple sclerosis

Heart disease (cardiomyopathy)

SKYRIZI

EGATEN

Risankizumabrzaa

Fascioliasis (parasitic infestation)

BALVERSA Advanced or metastatic bladder cancer

Plaque psoriasis in adults

Triclabendazole

Erdafitinib

DRUG NAME Active ingredient Approved use

TOP 15 DRUGS GLOBALLY IN 2018 Manufacturer Drug name

Sales (US$ billion)

AbbVie

Humira

Bristol-Myers Squibb and Pfizer

Eliquis

9.87

Celgene

Revlimid

9.69

Bristol-Myers Squibb and Ono Pharmaceutical

Opdivo

MSD

Keytruda

7.17

Amgen and Pfizer

Enbrel

7.13

19.94

THERAPEUTIC FOCUS OF MEDICINES APPROVED BY THE FDA IN 2018 Oncology

7.57

Infectious diseases

Herceptin

6.98

Avastin

6.85

Rituxan

6.75

Gastroenterology

Bayer and Johnson & Johnson

Xarelto

6.59

Pulmonary

Bayer and Regeneron Pharmaceuticals

Eylea

6.55

Roche

Johnson & Johnson and MSD Pfizer Janssen Biotech (Johnson & Johnson)

Remicade

5.91

Prevnar 13

5.8

Lyrica

5.16

Stelara

4.97 0

Hematology

Sources: TradeMap, ProMéxico, FDA, Genetic Engineering & Biotechnology News, DrugPatentWatch.

3 3

12 15

Neurology

Others

new therapies were approved by the FDA in 2018, breaking an all-time record

DRUG PATENTS EXPIRING IN 1H20 January

February

April

May

June

July

27th Vascepa Amarin Oharwms

8th Pomalyst Celgene

10th Qbrexza Dermira

4th Ablavar Lantheus Medcl

14th Qsymia Vivus

6th Vimovo Horizon

21st Juxtapid Aegerion

29th Aptivus Boehringer Ingelheim

16th Fortovase Hoffmann La Roche

17th Denavir Mylan Pharms

19th Vivitrol Alkermes

17th Xtoro Merlion Pharms

26th

21st

Drug name

Egrifta Theratechnologies

Gattex Kit Nps Pharms

Seller

new molecules were released on average per year between 2013 and 2018

CHALLENGES FOR BIG PHARMA:

CABLIVI

• Patent expirations, which IQVIA estimates will

Acquired thrombotic thrombocytopenic purpura

Romosozumabaqqg

Date

have an impact of US$121 billion due to losses of exclusivity between 2019 and 2023. • Lower returns from pharmaceutical innovation.

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Deloitte estimates that returns have fallen to their lowest levels in nine years: from 10.1 percent in 2010 to 1.9 percent in 2018.

EVENITY

Postmenopausal osteoporosis

JEUVEAU

Brexanolone

Temporary improvement in the appearance of glabellar lines

Postpartum depression

PrabotulinumtoxinAxvfs

ZULRESSO

It can cost up to US$2.17 billion to bring a new molecule to market, according to Deloitte MAIN MEDICINE IMPORTERS AND EXPORTERS Exports from Mexico (retail)

Imports to Mexico (retail)

25% US

23% India 23% Others 20% Germany 13% US 10% China 6% Canada 5% Belgium

25% Others 19% Germany 9% France 6% Switzerland 6% Canada 5% Italy 5% Spain

Global expenditure on medicine reached US$1.2 trillion in 2018 and will surpass US$1.5 trillion by 2023, according to IQVIA

IMPACT OF LOSSES OF EXCLUSIVITY (US$ billion) 0

2014

2015

-0.2

2016

-0.8

-5

2017

-1.2

2018

-1.6

2019*

-3.1

2020*

-5.2

-20 -25 -30

-13.3 -20.1

-20.5

-21.5

2022*

2023*

-1.7

-1.9

-3

-5.1

-10 -15

2021*

-14.9 -21.7

-22 -26.1

-21.8

Small molecules Biologics

-19.6 *Forecast

| VIEW FROM THE TOP

INVESTMENT NECESSARY TO ACCELERATE ACCESS TO MEDICATIONS RODRIGO PUGA President and Country Manager of Pfizer Mexico

Q: How will Pfizer's US$26 million investment at its Toluca

A: Genetic medicine will play a major role in our

plant accelerate the launching of new products in Mexico?

strategy, as a significant part of our efforts to discover

A: We are planning to improve our manufacturing plant to

new medications uses and new information about the

ensure that our products are manufactured using state-of-

human genome. Our scientists are modifying genes from

the-art technology. Our investment in clinical trials is directly

patients so their own bodies can fight diseases that have

linked to launching new molecules in the market. We have

no treatment. Genetic medicine and immunotherapy

roughly 30 clinical trials in Mexico with approximately 500

are becoming increasingly important in pharmaceutical

patients and we are collaborating with research centers across

research. The latter has led to the development of

the globe to generate data to bring these breakthroughs

immune-oncology, which aims to modify the immune

to the market. We are also investing in scientific projects

system to fight cancer cells without medication.

through Instituto Científico Pfizer (Pfizer Scientific Institute). In 2018, we established an alliance with INMEGEN to Pfizer’s new mission is to be able to launch innovative

strengthen research on the Mexican genome to develop

medicines that change patients’ lives at a faster pace. Patients

treatments specifically for the local population. Genetics

are at the center of everything we do and innovation is our

can change significantly from one area to the next. Our goal

driving force. We do not want medicines that are just a bit

is to use this alliance to understand the genome of local

different; we want to find breakthroughs that save patients’

populations. For the past 15 years, Pfizer’s Scientific Institute

lives. Innovation has characterized Pfizer for 170 years.

has allied with scientists and institutions to bring basic research to Mexico. We also work with local universities

Q: How is Pfizer adapting its R&D strategy to address

and the National Medicine Academy to recognize the best

existing and future healthcare problems?

medical students from all universities.

A: About 15 percent of Pfizer’s global profit – approximately US$8 billion – is used to fund R&D every year in many

Q: What are the main access barriers Pfizer has identified

therapeutic areas. At this point, we are focusing on those

in the Mexican market and how are you overcoming them?

diseases where we can generate significant scientific advances

A: Since January 2019, the company has been directed by

and on those that have been overlooked. We are investing

Albert Boula, who is reinforcing our position to put patients

in oncology, inflammation, immunology, new vaccines, rare

at the center and our focus on developing markets to look

diseases, antibiotics and cardiovascular diseases. One of our

for ways to make innovative medications more available to

products uses genetic modifications to cure hemophilia type

patients. We are becoming more creative in developing ways

A and B. We are also developing new antibiotics to combat

to increase access to healthcare, such as developing innovative

superbugs. Unchecked, antimicrobial resistance will kill more

payment schemes that will increase access by allowing public

people than cancer by 2050, at an estimated rate of 10 million

institutions to pay for results instead of products.

lives per year. Our goal is to launch 25 new therapies by 2025. Mexico has some of the greatest challenges in the region Q: What role will genetic medicine play in Pfizer’s pipeline

regarding the introduction of innovative medications. For

and how are you involving local institutions in this research?

every 100 medications registered in Mexico, only four reach the patients who need them. For instance, we have a product that treats metastatic breast cancer and doubles life expectancy.

Pfizer is one of the largest multinational biopharmaceutical

However, patients in the public system cannot access this

corporations in the world. It is headquartered in New York City

medication. Moreover, introducing innovative medicines

and in 2018, ranked 57th on Fortune’s list of the 500 largest US

to public institutions takes around five years. Mexico must

corporations by total revenue

recognize the benefits of increasing access to health.

VIEW FROM THE TOP |

INNOVATIVE PAYMENT MODELS CAN INCREASE ACCESS TO INNOVATIVE MEDICATIONS ANA LONGORIA President and Director General of Novartis

Q: How will Novartis’ US$20 million investment in Mexico

pays only for results. We are talking with local authorities

for 2019 be allocated?

to introduce these models, which forces us to ensure that

A: At the World Economic Forum, Novartis’ CEO met with

the medications we sell benefit the patient. This will be

Luz María de la Mora, Deputy Minister of Foreign Trade at

increasingly important with the arrival of personalized

the Ministry of Economy, and committed US$20 million to

medicine, which allows laboratories to tailor their products

Mexico. This sum is part of Novartis’ 2015 commitment to

to ensure they are useful for patients.

invest US$50 million in the country by 2020. At this point, we have invested over half of that promised amount. We expect

We have also made significant advances in our

to continue investing in the country as the pharmaceutical

transformation area, which focuses on how technologies

industry expands thanks to Mexico’s growing population.

like AI and social media can better support patients during their journey fighting a disease.

The investment will go to clinical research, an area with significant opportunities in Mexico. In 2018, Novartis invested

Q: How will Alcon’s spinoff help Novartis strengthen its

US$3.5 million to perform over 70 clinical trials in several

position in the pharmaceutical industry?

therapeutic areas in Mexico.

A: Alcon separated from Novartis on April 4, 2019. This will allow Alcon to strengthen its position in the ophthalmic

Novartis has only five Global Service Centers and we decided

products market and will allow Novartis to strengthen its

to install one in Mexico in 2015 because the country offers

commitment to certain therapeutic areas. From the division,

an excellent location, is cost-competitive and has many

we kept ophthalmologic medicines. We will focus on our

talented professionals. We have high expectations for this

medicine portfolio, as our pipeline has extremely interesting

center as it continues growing. We now perform several

products that will enter the market in the next few years.

operations here that were previously done in the US and other Latin American countries.

Q: How did Novartis help Centers of Excellence to improve treatment of diabetic patients?

Q: How is Novartis collaborating in the introduction of

A: These centers help health institutions with which we

innovative medicines to the Mexican market?

collaborate through the incorporation of best therapeutic

A: Novartis has one of the strongest pipelines in the industry,

practices, from opportune diagnosis to adherence to

which allows us to launch a large number of new products

treatment and support for the patient’s family. Often,

per year. We are increasingly focusing on oncology, mental

institutions have all the necessary tools for a successful

diseases and cardiology. Recent technological advances are

treatment plan but they do not know how to build one. In

allowing for the discovery of new medications at a faster

these cases, we help them to use their own tools to create

pace. Mexico’s regulatory system must adapt to the growing

effective protocols for the correct management of diabetic

number of new medications and we are developing new

patients. We identified several areas we can improve to

models to bring innovative medicines closer to the Mexican

make treatment more efficient and give patients what they

population.

truly need. We have replicated this model for patients with heart failure and have had great results.

In developed countries, about 10 percent of the population has access to innovative medications. In emerging countries, these are only available to 1 percent of the population.

Novartis has

The pharmaceutical industry has been unable to bring its

therapeutic areas, including neuroscience, oncology, respiratory

products closer to those who need them. A way to fix this is

diseases, dermatology and immunology. The company has 10

through innovative access models in which the public sector

potential blockbuster launches planned for the next years

multiple

research

laboratories

focused

VIEW FROM THE TOP |

BETTER DIAGNOSTIC METHODS HELP BUILD STRONGER PREVENTION PROGRAMS ANDRĂ&#x2030;S BRUZUAL General Manager of Roche Pharmaceuticals Mexico

Q: How is Roche Pharmaceuticals combining its diagnostics

development of new treatments are immunotherapies,

and pharmaceutical divisions to improve the prevention

which represent a change in the way we treat tumors. Our

and treatment of diseases?

treatments specifically cater to patients with the mutations

A: With significant advances in the last few decades, we are

PD-L1 and ALK positive.

now able to detect diseases at an opportune stage and offer more effective treatments. For 70 years, Roche has been

Q: How can Roche Pharmaceuticalâ&#x20AC;&#x2122;s cancer approach

developing therapies in areas where treatments did not exist.

support earlier diagnostics?

Our focus has always centered on offering a combination of

A: We have always been at the forefront of medical

the most advanced diagnoses and treatments to increase

education. The development of better diagnostics has

not just chances of survival, but also patients' quality of life.

led us to create programs and educational modules for health professionals. These have aided efforts to prevent

Q: How is Roche Pharmaceuticals innovating within the

and diagnose disease at an early stage. This is particularly

Mexican healthcare sector?

the case in the area of cancer, the third cause of death in

A: One of our companies is Foundation Medicine (FMI). This

Mexico. We have different prevention programs directed

foundation is focused on developing precision medicine. Using

at both doctors and patients, like Prohibido Rendirse and

advanced diagnostics, we can gather a specific picture of the

Respirar y Vivir. We are now launching a campaign that

patient and their condition. This allows us to develop medicine

will certify professionals in early detection of breast cancer

that is highly personalized to their profile. Oncology is an area

and reduce the time it takes to refer people to specialists.

where this has seen major growth. Using gene characteristics,

The promotion of health is a significant component of

one can create a therapy which is more likely to have a positive

opportune detection of cancer. Our work with diverse

response. Combining these diagnostics with a personalized

actors allows us to reach different social groups which can

treatment will undoubtedly lower the burden of the most

be targeted for early detection. The combination between

prevalent disease. Personalized treatment also focuses on

providing information to the population and providing

improving quality of life and reducing complications.

medical education to health professionals is the best way to prevent cancer amongst the Mexican population.

Q: What specific treatments does Roche Pharmaceuticals offer the market for cancer patients?

Q: What integral mechanisms need to be implemented to

A: Our portfolio of therapies contains 14 different

increase access to innovative medications in Mexico and

medications against cancer and various types of tumors.

what role will your company play in their generation?

These medications help treat over 1 million people worldwide

A: At Roche Mexico, we focus on helping the population have

every year. We have been innovating in Mexico for over 70

access to the best solutions in health and the benefits that

years and this has allowed us to make major advances to

a complete and innovative treatment can bring. We think

tackle chronic-degenerative diseases such as breast, cervical,

our role should not be limited to developing therapeutic

ovarian, colon and lung cancers, as well as rheumatic arthritis

solutions but also commit fully to ensure patients have

and various other diseases of lower prevalence but major

equal access to diagnosis and treatment. We need to work

impact, such as hemophilia and multiples sclerosis.

from our respective position to meet common goals.

Due to our investment and research, which last year was close to US$11 billion worldwide and around MX$220

Roche Pharmaceuticals is the largest biotech company in

million in Mexico, we reached a new goal with the arrival

the world, specialized in drug development for oncology,

of four new innovative molecules for distinct conditions,

immunology,

including two for the treatment of lung cancer. Part of this

neurosciences

infectious

diseases,

ophthalmology

and

| VIEW FROM THE TOP

PROBIOTIC PIONEER SEES A FUTURE IN GASTROENTEROLOGY ALEJANDRO MARTÍN Director General of Mayoly Spindler México and LATAM

Q: How do Mayoly Spindler’s Mexico operations contribute

by the National Institute of Medical Science and Nutrition

to its global activities?

Salvador Zubirán discovered that many Mexicans take

A: Mayoly Spindler is a French group composed of 30

probiotics without any knowledge of what they are for.

companies that focus on manufacturing, dermocosmetics and pharmaceuticals. In Mexico, we focus on pharmaceutical

Q: How ready are doctors to prescribe probiotics?

operations related to gastroenterology and we work with

A: Probiotics are classified as food supplements, so it was a

a distributor for the sale of dermocosmetics. Our Mexico

challenge to get doctors to prescribe them. We conducted

offices manage all our activities in Latin America. In 2019, we

a marketing study with Mexican opinion leaders and asked if

will enter Guatemala and launch Probiolog IBS in Colombia,

it was a problem that these products were classified as food

Peru and Ecuador. We are also present in Argentina and

supplements. The doctors in the survey were not concerned

the Andean region. Mexico has a large number of adults,

about labeling as long as the product was backed by scientific

to whom most of our products are directed; however, the

evidence. Before launching Iprikene, which treats diarrhea, we

population’s purchasing power is low. For that reason, in

visited gastro-pediatricians, of whom there are very few in

Mexico we focus on volume sales at a lower price, while in

Mexico, to ask them about their concerns. Today, it is the

France we prioritize price over volume.

most prescribed product for diarrhea. Probiolog, a diarrhea treatment that we introduced in Mexico in 2018, is fortified

Q: How has Mayoly Spindler influenced Mexico’s healthcare

with zinc and meets international standards.

sector and practices? A: We are pioneers in the use of probiotics in Mexico and

Q: Which new products will Mayorly Spindler introduce

have the largest probiotic portfolio in the country. Ten years

to Mexico in the near term and how is the market for

ago, we saw a commercial opportunity here and launched

gastroenterology products changing?

the country’s first probiotic, which was a treatment for

A: We are also innovating in product packaging by

diarrhea. Together, our products target 35 percent of

introducing probiotics that do not need to be encapsulated

the most common gastroenterological diseases. In 2018,

or dissolved in water and can instead be consumed on their

we launched a product that treats metabolic syndrome,

own, which increases patient adherence. The Mexican market

another for diarrhea and one for constipation.

has slightly decreased by units while increasing in price. The gastrointestinal segment is behaving similarly, although price

Q: How would you describe the penetration of probiotics

growth is small. During 2018, we climbed the market rankings

in Mexico?

by four positions in the gastrointestinal segment in terms

A: A market study of probiotics that we conducted in Mexico

of units to 47th place; we rose six positions in value to 54th.

showed that about 30 percent of the population requests a

During the 12 months preceding December 2018, the overall

probiotic from their gastroenterologist, especially in cases

market of gastroenterological products represented 390

of irritable bowel syndrome, gastritis and gastroenteritis.

billion units, for a total of MX$417.4 billion, of which Mayoly

Most probiotics in the market focus on diarrhea, so we

Spindler sold 126 million units.

are targeting other gastroenterological diseases. We are generating a culture of probiotics. A survey conducted

Due to several economic factors, the only countries to report positive sales in 2018 were France and Mexico, which is Mayoly Spindler’s most profitable market and in which we hold a 10.2

Mayoly Spindler is a French company founded in 1909 with

percent share. The company has always grown more than

a presence in over 70 countries. Its fields of expertise include

the market for gastroenterological products; for example,

pharmaceuticals, dermocosmetics, gastroenterology, contract

between 2017 and 2018 the market grew by 8.4 percent but

development and manufacturing

Mayoly Spindler grew by 22 percent.

VIEW FROM THE TOP |

FOCUS SHOULD BE ON TOTAL TREATMENT COST NOT DRUG COST MARCO RUGGIERO General Manager of Chiesi México

Q: How is the company advancing with its neonatology

Q: What have been Chiesi’s major successes and challenges

and respiratory solutions?

in COPD treatments?

A: We closed 2018 with a 25 percent growth, mainly driven

A: We have an innovative triple-treatment therapy for

by our special neonatology care line CUROSURF. After 15

COPD, which we launched across the entire American

years, this product still grew at a 17 percent rate in 2018

continent, and first in Mexico. This was a major source of

compared to 2017. This has allowed us to further penetrate

pride for us but also for our Mexican partners in hospitals

the Mexican market and to persuade doctors to use our

and clinics. One of the main issues related to COPD is the

treatment for premature babies affected by respiratory

lack of awareness about the disease, which often results in

distress syndrome. This treatment has helped save countless

misdiagnosis. Doctors continue to prescribe dated single-

lives and ensured that babies have a chance to have normal

agent drugs that can provide relief during the moment of

lives after their premature birth.

crisis but that do not address the inflammatory chronic nature of the disease. In other cases, patients are given

Q: How do you intend to grow beyond your position as the

antibiotics, which are completely unsuitable. To counter

third-largest pharmaceutical player in the respiratory field?

these misconceptions, we have our own program to raise

A: Our respiratory line enjoyed rapid growth of 36 percent

awareness of the disease. This includes an alliance with

in 2018. Having launched our first product in Mexico in

two pharmacy chains where information is provided

2013, we are doing quite well. Yet, there is still a great deal

through consults with patients. Unfortunately, just as with

of room for improvement and to strengthen our position

CUROSURF, our COPD treatment has not been included in

compared to larger competitors like GSK and AstraZeneca.

IMSS’ registry and remains inaccessible to a large portion

We will continue to invest and expand our staff presence

of the population.

in the country. Q: How important is it for Chiesi to expand its portfolio in In the area of neonatology, one major barrier is that our

new treatment areas?

treatment CUROSURF has not been included in IMSS’

A: Part of our strategy for the last five years has been to

medication registry, which is the largest public health

create a third pillar in our product offering focused on rare

insurance institution in the country but still has the

diseases. Hopefully, the regulatory process in Mexico will

very strong conviction that it should buy the cheapest

enable us to bring it to the market as soon as possible.

medications. Our treatment may have a higher price but

There are no therapies in Mexico for something like Leber’s

ultimately, because of its greater effectiveness, is actually

Hereditary Optic Neuropathy. Therefore, it is in the patients’

going to reduce costs across the whole treatment course.

interest to increase access to these treatments. Although

Considering only the cost of the medicine is wrong.

the patient group with rare diseases is limited, it is society’s

Treatments should count the number of medicinal packages

duty to look after them. More often than not, these patients

needed for the duration of the treatment, as well as costs

are neglected by medical institutions, the government and

related to the patient’s journey toward improvement. IMSS’

pharmaceutical companies. This particular treatment can

new board should come to the realization that real savings

completely cure this condition. Even if there are only 500

cannot be achieved through procurement but through an

people who need it, it is still worth it.

integral analysis of the total cost of treatment. Right now, the institute is effectively buying the wrong product and spending more than they should. Unfortunately, there is

Chiesi Group is a pharmaceutical manufacturer founded

no indication that there will be a change in direction. As a

in Italy in 1935. It is present around the world through 26

result, some of the most innovative therapies are still only

subsidiaries, three manufacturing plants, five R&D centers and

accessible through private healthcare.

direct distribution in over 60 countries

| COMPANY SPOTLIGHT

IGSA MEDICAL: CHALLENGING THE STATUS QUO IN HEALTHCARE Timely and comprehensive patient care is the central axis for improving quality of life. IGSA Medical focuses on providing comprehensive health solutions through the construction of hospital infrastructure, equipment, operation of comprehensive medical services and nonmedical services. All its services are geared toward quality and warmth of service, with care regulated by the most stringent national and international standards that guarantee the patient a dignified experience and improvement. In nearly 10 years of operation, the company has accomplished a multifaceted approach and established a strategy to treat chronic renal failure patients based on training for employees, creation of multidisciplinary teams and inclusion of patients’ families as key components. Employee training has enabled IGSA Medical to contribute to community development and to place certified experts at the service of patients and their families. Together with highly renowned educational organizations and the Ministry of Labor and Public Welfare, the company has developed an ideal breeding ground for doctors, nurses, social workers, nutritionists, psychologists and administrative employees, with the sole purpose of providing integral attention to the patient, from a physical, mental and social perspective. In addition to complying with an inclusion protocol, all newly admitted collaborators are part of teams with different academic profiles and experiences to provide a holistic treatment to patients. Participation of families is also key to ensuring a positive environment for patients because they are the ones who accompany, assist and ensure treatments are followed. IGSA Medical has developed several events to incorporate the patients’ community and to provide training for patients, their families and others close to them to improve the patient’s quality of life. This holistic approach is supported by technology and inhouse developments for patient registration and surveillance, process automation at critical points and database development. IGSA Medical’s philosophy has allowed the company to build a presence in 14 hemodialysis hospitals in Mexico to help in the care of patients with chronic kidney disease, serving more than 1,200 patients monthly through more than 15,000 renal replacement therapies.

| VIEW FROM THE TOP

CENTRALIZED BUYING ALLOWS BETTER OVERSIGHT DAVID LĂ&#x201C;PEZ Country Manager of BioMarin Pharmaceuticals

Q: Last year, BioMarin was expecting to win approval for

A: There are two main pillars. One is neonatal testing.

Vizimim, a treatment for Morquio A Syndrome. Where does

Recently, the director of IMSS signaled it would widen the

the application stand?

different conditions tested after birth. Which diseases is

A: Last time we spoke, we were still in the application

still not clear. Currently, there is also an initiative in the

process for inclusion of this medicine on the coverage

Senate that is proposing to include a list of metabolic,

schemes of health insurance agencies. The big state

genetic rare diseases in this test. The earlier diseases are

agencies, IMSS and Seguro Popular, cover the majority of

detected the better chances of prognosis and a better

the population. For the past nine years these institutions

life for the patient. The public sector has understood

have been very closed, not accepting a single new orphan

this and has created different programs. In this case,

drug medication. NGOs and doctors themselves have

there have been strong examples of good cooperation

applied pressure to accelerate the approval of treatments,

between laboratories that are providing their services to

simply because they see the potential of these new

the government.

medicines and treatments. In 2018, we were very happy to receive the approval from Seguro Popular for our product.

The second pillar is education. At medical school there is

It was a significant event. The key was to work closely with

still a lack of attention to rare diseases. Many doctors do

the government to create a strategic alliance to combat

not know how to diagnose and manage these diseases.

this syndrome. Unfortunately, with IMSS our approval

This means it can take years before a person receives the

process continues.

right treatment, which often requires a multidisciplinary team of caregivers.

Q: What is your view of centralized acquisition of medications, particularly for insurance companies?

Q: What integral mechanisms need to be implemented to

A: The health sector does not have a fixed protocol for

increase access to innovative medicine in Mexico?

this. IMSS has been doing large-scale centralized buys of

A: One of the ways this is happening is that pharmaceutical

medication for a long time and they have a mechanism

companies are meeting with insurance companies to

for this. Personally, I think centralized buying is smart

propose projects. These include not just a medication, but

because it reduces unaccounted losses. In the past,

a whole service. Insurance companies can invest in these

funds would be designated to the states to buy the

projects. One way you can offer a risk-shared product is if

necessary resources. However, large amounts of money

you agree to a plan where the payer only covers medication

disappeared. Doing it centrally will allow better oversight.

if it works. The government can certainly be an ally with

Equally, the individual health providers will not have to

the pharmaceutical industry. Innovation brings better

take charge of buying, which will allow them to focus on

treatments that can reduce the overall burden on the health

their other operations.

budget over the longer term.

Q: It is estimated that 8 million Mexicans live with some

Q: What are your main goals for the medium term

rare disease. How can the private and public sectors

in Mexico?

improve diagnosis and treatment of rare diseases?

A: One is to continue soliciting IMSS to get Vizimim approved. We will continue working with Seguro Popular to implement the treatment and improve the process for

BioMarin Pharmaceuticals is a US biotechnology company and

patients and providers. Of course, we also have other

a world leader in developing and commercializing innovative

products waiting to be launched. Lastly, we will aim to

biopharmaceuticals for rare genetic diseases. It has offices in

optimize diagnosis and treatment by providing better

North America, South America, Asia and Europe

training to specialists.

VIEW FROM THE TOP |

MEXICAN RESEARCH INSTITUTE AIMS TO BECOME A PLATFORM FOR NATIONAL R&D SONIA PĂ&#x2030;REZ Executive Director of UDIBI

Q: What are the main research lines carried out by UDIBI?

clinical trials with them but now the institutions themselves

What are the instituteâ&#x20AC;&#x2122;s most mature products?

are interested in testing our products.

A: UDIBI has three main development axes: new projects from Transferon, innovation in antibody research with

Q: What are the main capabilities of UDIBIâ&#x20AC;&#x2122;s antibody

new targets and services to the pharmaceutical industry.

research unit?

Transferon is a blood product extracted from cells and

A: Our antibody research unit has partnered with US

one of our goals is to obtain it through synthetic means.

Global Bio to develop platforms and libraries for antibody

It is formed by a very complex mixture of peptides, so

discovery. What distinguishes this platform is that it is made

we are elucidating its composition using peptide analysis

up of 200 Mexican researchers. This platform allowed us

techniques. We are also selecting the molecules with

to offer our research services to international laboratories,

greater biological activity to develop new products for the

mainly in the US, and we are planning to offer services of

treatment of tumors, infections and hypersensitivities. We

this kind in Mexico.

are now conducting tests to identify new therapeutic uses for Transferon, which will give us time to develop these

We are developing a chikungunya antigen to develop

new peptides.

antibodies for passive therapy and diagnostics and antibodies for tumor necrosis factor (TNF). We also perform

Q: What were the main challenges in the development of

discovery on demand for the US, where they send us the

Transferon?

targets and we develop antibodies for them. One of these

A: One of the main problems was that its nature as a

was launched with the Trudeau Institute.

complex mixture of peptides clashed with old analytical techniques to study medications. Not too long ago, most

Q: What are the main barriers to the development of

medications were small molecules that followed traditional

Mexican R&D?

pharmacodynamics and pharmacokinetics in order to be

A: There are many barriers. The first is the lack of a legal

evaluated by a regulatory entity. The generation of complex

framework that facilitates this process. Second, there is a

molecules represented a challenge for pharmacists,

lack of knowledge among academic researchers about how

manufacturers and regulators, who had to develop new

to develop and launch a product to the market. Another

ways of dealing with these drugs. Complex molecules

large problem researchers face in Mexico is dealing with the

behave differently from small molecules and will exhibit

complex process to acquire materials for their research, since

completely different pharmacodynamics and behavior

getting an approval to buy a product can take up to three

in the human body. They are also harder to track and

months and the logistics to reach a research center can take

quantify. For that reason, it was necessary to develop new

45 days. There have been numerous federal initiatives to

guidelines that addressed these medications. Transferon is

streamline our supply chain but they have not been successful.

a mixture of peptides and for that reason its behavior was

Importing products is extremely complex as there are many

not perfectly understood until the appropriate techniques

intermediaries and customs issues but these problems have

were developed to characterize it.

a greater impact on public research institutions, while private companies have managed to control them.

Q: What have been the main challenges in getting the medical community to accept products of this type? A: Many in the medical community have been extremely

UDIBI is a research and support laboratory for biochemical

open to new treatments and therapies, making it easier for

companies that also has capabilities as an authorized third party.

us to conduct clinical trials. Interestingly, we previously had

The center studies antibodies and performs bio-compatibility

to work hard to convince doctors to allow us to carry out

tests and biological and physicochemical characterization

VIEW FROM THE TOP |

MEXICO GATEWAY FOR LATIN AMERICA EXPANSION AMÉRICO GARCÍA Latin America Managing Director of Apopharma

Q: What was the motivation to create Apopharma and

In doing so, we were able to benefit many patients with

what market niches will this new division fill?

musculoskeletal affections.

A: Although generic medicines are growing in Mexico, patients in the country still prefer branded products, accounting

Q: Why was Mexico chosen as the base for Apopharma

for more than 70 percent of the market. Given the nature

over other countries?

of the Mexican health system, the private market in the

A: Apopharma has presence with innovative medications

country is mainly out of pocket. Additionally, an important

in other countries, but in Mexico the company is piloting a

part of the population prefers to seek private healthcare,

new strategy to reach patients and physicians with branded

which leads doctors to look for efficient, high quality and

products in selected specialty segments. The same products

higher cost-benefit ratio therapeutic alternatives. Apotex

that we are introducing into Mexico are being used in millions

has a comprehensive product portfolio that makes it highly

of prescriptions in Canada, the US and Europe but under a

competitive and allow patients to receive top-quality products.

different commercial strategy. Mexico is a dynamic market where brands are relevant for patients and physicians.

Apopharma, Apotex’s prescription division, is an opportunity

Leveraging on this, and with the company’s commitment and

to diversify the presence of the company in Mexico and

flexibility to serve the specificity of this market, Apotex dared

expand our reach into new channels contributing to Mexico’s

to move out of its comfort zone to bring fine medicines first

health alternatives. Apopharma strives to provide products

to Mexican patients, and to the rest of Latin America once

that meet international quality standards and have been

the strategy penetrates throughout the region.

certified in different parts of the globe, including US, Canada and Mexico, at the best cost. Moreover, our products

Q: What therapeutic areas does Apopharma cover and

have been endorsed by health authorities such as the

what are some of the medications included in its portfolio?

European Medicines Agency (EMA), FDA, Health Canada

A: Today Apopharma is present in three segments: central

and COFEPRIS in Mexico. All of the previously mentioned

nervous system (CNS), analgesia and lipid lowering

aspects enabled Apopharma to be launched in Mexico in

medications. Some of the drugs we are introducing are for

2018. Ever since that moment, we have offered one of the

treating depression, anxiety, Attention Deficit Disorder (ADD),

most complete product portfolios in central nervous system

Alzheimer’s, Parkinson’s, neuropathic pain, lipid-lowering,

(CNS), analgesia and starting in 2019, cardiology.

chronic and acute pain, amongst others. Along important brands such as Periamid, Ansdepcan, Filcos, Minofedral and

Q: What does Apopharma represent for Apotex in terms

Exotrima, Apopharma’s star medicine is Menural, prescribed

of profits and investment?

for different types of dementia. Menural contains the active

A: We are at an early stage of introducing Apopharma in

ingredient Memantine for Alzheimer’s. What makes Menural

the market. Apopharma in Mexico and Latin America still

and all our medicines different from other players is that

presents the opportunity to expand and penetrate other

they are endorsed and certified by the most important and

segments where the company has not been present yet.

strict health regulatory agencies worldwide. Our significant

Without any doubt, this represents a great success for

investment in R&D has enabled us to have a positive impact

Apotex which can proudly say that it provides physicians

on patient’s quality of life for more than 20 years.

and patients a wide variety of globally commercialized products. Currently, we are seeing the results of an investigative collaboration between Mexico and Canada

Apopharma is part of Apotex. It is an innovative drug company

in different therapeutic areas. This has allowed us to

focused on developing and commercializing products for

accomplish diverse goals such as being the first company to

patients with debilitating and life-threatening diseases where

launch Filcos (Etoricoxib) just after the patent had expired.

treatment options are limited or do not exist

| TECHNOLOGY SPOTLIGHT

CHIESI: LESS INVASIVE TECH DEFEATS OLD ENEMY Respiratory Distress Syndrome (RDS) is a breathing disorder that affects mainly premature infants, which leads to breathing problems and often deficiency of pulmonary surfactant that does not permit the expansion of the alveoli for proper gas exchange. Delays in treating it can cause severe damage mainly to the lungs or the brain. RDS was a death sentence 50 years ago as there was neither technology nor medicines to treat it. In the 1980s,Tore Curstedt and Bengt Robertson developed a natural drug composed of porcine lung phospholipids for premature infants named CUROSURF. This medicine quickly expanded across the globe thanks to Chiesi’s involvement. Neonatal mortality was greatly lowered through the development of a technique to reduce damage caused by providing the newborn with endotracheal intubation and mechanical ventilation, which Chiesi has also incorporated in its solutions. This technique is called INtubation-SURfactantExtubation (INSURE). INSURE’s success sparked interest to renew non-invasive techniques to administer surfactant, such as the development of very thin endotracheal catheters to reduce damage to the airway. This led to the development of less invasive surfactant administration (LISA) and minimally invasive surfactant therapy (MIST) techniques, which together have greatly contributed to decreasing premature infant mortality. This has also been supported by the use of nasal continuous positive airway pressure (CPAP). Research continues on surfactants’ physiology and on the development of new management and application techniques that reduce the impact on the newborn. These include the development of new fogging devices, such as perforated vibratory membranes that can atomize surfactants and deliver them by nebulization, greatly improving the application of the nebulized aerosol, providing greater control of droplet size and reducing side effects. The ultimate objective is to develop truly non-invasive techniques. Initial studies of these procedures in newborns have decreased the need for intubation and surfactant redosing by up to 50 percent. Founded in 1935, Chiesi is an Italian company that specializes in the research, development and production of medicines for respiratory, neonatological and cardiovascular diseases. It now distributes its products in more than 80 countries and entered Mexico in 2006 with CUROSURF, a treatment for RDS.

| VIEW FROM THE TOP

PATIENT CENTRICITY IS CHANGING PHARMACEUTICAL INDUSTRY JAVIER AMTMANN Director General of the Board of Menarini

Q: What are the potential opportunities for a

creating a product development plan supported not only by

pharmaceutical like Menarini in the Mexican market?

the research centers we have in Italy, but also through our

A: The aging population and the increase of

business partners to generate high value-added solutions.

noncommunicable diseases have opened up an opportunity

Our next step will be to expand our research centers in

for growth for us. Menarini has based its strategies on the

the region.

local prevalent illnesses and the opinions of doctors to meet patients’ treatment needs. In December 2018, we obtained

Q: In Spain, the Menarini Group launched the Sherpas20

the registration for a patented cardiovascular product

project to develop a digital health training program. What

with Daiichi-Sankyo. We hope to launch this product by

benefits could this program offer to Mexico?

the end of 2019. In the gastro segment, Menarini launched

A: It is a project designed specifically for Spain that has

a probiotic treatment for irritable bowel syndrome. The

resulted in many benefits for health professionals and

treatment has been very well-received.

patients. The strategies for Spain and for Mexico are different, however, because they are markets with different

Q: How is the patient-centric model applied across the

conditions, especially in terms of the digital environment.

Menarini value chain?

What we seek through this type of project is to strengthen

A: Our philosophy is to provide solutions that benefit the

Menarini’s link with doctors, to understand their needs

patient and extend this result to the entire health ecosystem.

and to strengthen their relation with patients. In the case

Menarini’s strategy is to focus on certain market segments,

of Mexico, we are just beginning to establish these links and to increase our presence in the market. In the future, we will introduce similar projects to Mexico and they will

Menarini is an Italian pharmaceutical company with three

have to adapt to the needs of the country. Menarini also

business divisions: Menarini Ricerche, Menarini Biotech and

sees interesting potential in introducing these projects in

Menarini Diagnostics. It works in five therapeutic areas: pain,

other markets, such as Peru, Ecuador and Colombia, to

cardiovascular, respiratory, dermatology and digestive

strengthen our presence in Latin America.

Liomont oral liquids' manufacturing plant

VIEW FROM THE TOP |

GENERATING PARTNERSHIPS TO BOOST NUTRITION AND PROBIOTICS AUDE BOCLÉ General Manager of Biocodex

Q: How does Biocodex’s offering differ in Mexico and how

consideration. We are aware of the challenges that Mexico

has that helped you build your presence in the country?

faces in terms of chronic and serious diseases and, considering

A: Until 2018, Biocodex mainly marketed one pharmaceutical

our microbiota focus, the best way we can tackle these issues

product called Floratil, which has been in the market for 25

is through prevention and education. Nutricia's specialized

years. This has given us the credibility of a growing company

nutrition line suits this objective as an adapted nutrition in

that delivers on the promises of its products. The scientific

early age can positively impact a patient's life.

research behind Floratil makes it a unique probiotic in the market regarding effects and benefits, ensuring safety and

Floratil not only allows to treat gastrointestinal issues but

quality. Biocodex will complement its microbiota offer with a

also has preventive actions. In the second half of 2019, we

new offer of probiotics food supplement. Besides its portfolio

will also launch a new probiotic-based food supplement

of microbiota brands, Biocodex is proposing a unique platform

line focused on well-being and prevention. Among those

of communication through its Biocodex Microbiota Institute to

products, CYSTALIA will focus on prevention of cystitis in

inform and educate both patients and healthcare professionals

women and DIFESIA will strengthen the immune system to

on microbiota.

prevent infections. We will launch this line globally, which is a key moment for Biocodex because it will fuel our mission to

Q: What is the company’s strategy to develop its business

develop our leadership in the microbiota area. The products

inorganically?

will be distributed worldwide and the only difference might

A: Biocodex recently signed an alliance with Nutricia, Danone's

be the name of the products given regulatory constraints.

specialized nutrition branch, to distribute and promote its infant formula range. This line of nutritional products and baby

Q: How would you rank research in Mexico regarding

formulas benefit of over 120 years of research in nutrition

microbiota?

and 40 years of research in breast milk. Our goal with this

A: For a couple of years, microbiota has become one of

partnership is to evolve from a mono-product status to a

the fastest growing areas of medical research worldwide.

more visible and larger operation that represents a very good

The scientific community recently discovered that

business opportunity, since we are entering a market that is

microbiota could be considered another organ of the

now ten times larger than the probiotic one.

human body as it can influence physiological functions outside the gastrointestinal system such as neurological,

At Biocodex we are convinced that nutrition during the first

metabolic or immune functions. We have realized R&D

thousand days of life is a key factor for growth, development

is highly active in Mexico and that microbiota is also an

and the microbiota. That is why we are now interested in

area of particular interest among researchers. Biocodex

offering options that fulfill the nutritional needs of all children.

Microbiota Foundation’s goal is to promote research in

In this purpose, Nutricia portfolio perfectly fits the microbiota

microbiota around the world. To achieve this objective,

focus of Biocodex. Nutricia and Biocodex both have a similar

Biocodex Group has been providing grants to researchers

long-term vision for the development of their operations and

in all countries where it directly operates. In September

footprint in Mexico.

2018, we celebrated the first grant in Mexico offered to a team of scientists in Michoacan.

Q: How do you tropicalize your strategies to the needs of the local market? A: Biocodex has a global strategy that integrates local

Biocodex is an international pharmaceutical company with

constraints, priorities, strategies and environmental

expertise in probiotics for the gastroenterology area. It has

conditions. The decisions we make at our headquarters

gathered momentum in the microbiota area, diversifying its

are locally implemented, taking all those aspects into

portfolio to now offer microbiota healthcare solutions

| VIEW FROM THE TOP

CERTAINTY NEEDED TO SPUR INVESTMENT FOR DRUG DEVELOPMENT MAURICIO MENDIETA Managing Director of Gedeon Richter México

Q: How has the company progressed in its goals to boost

often five months. We had to make clear to the government

its presence in women’s healthcare and consolidate a

that we are not offering a medication but a treatment of a

business unit focused on biosimilars?

whole other class. We can offer a product that is not only

A: Three years ago, there were three players in the women’s

better but reduces the need for surgery by 40 percent. We

health segment and now there are 12. That is aggressive

are reorienting the entire model of treating symptomatic

growth. It is very important to define what we want to

uterine fibroids in Mexico.

be as a company. We want to be a pharmaceutical that provides specialized treatments in the area of gynecology.

Q: What opportunities exist to make Mexico a clinical

Gedeon Richter works with 6,000 gynecologists across the

research hub and what business opportunities would result

country. Our competitors’ coverage ranges from 6,500 to

if that becomes a reality?

120,000 doctors. Our differentiator is that 90 percent of

A: Thirteen percent of our global sales returns every year

our doctors are gynecologists and not a mixture of different

is invested in R&D. In Europe, we have three biotechnology

specializations.

plants. In Mexico, R&D is not our immediate priority due to bureaucratic hurdles. At CONACYT, researchers are driven

Our goal is clear. We will continue expanding our portfolio,

by the number of publications they produce. There are

introducing added-value products and working with

other institutes that are dedicating efforts to development

specialized doctors. In the private sector, the goal is to

but approval processes are slow. Ten years ago, 50 percent

consolidate a presence in all therapeutic areas of women’s

of the investment in research was tax deductible. That is no

health. In the public sector, we are focused on contraception

longer the case. We certainly see potential in Mexico as a

and introducing the uterine fibroid treatment Esmya.

research and innovation location for us but industrywide,

Overall, we have 10 products pertaining to women’s health

there needs to be more support.

and will launch two more this year. Q: How is the political climate impacting the sector? Q: What is the difference between public and private

A: The reality is that there is a great deal of uncertainty

sector clients?

related to investing in Mexico. There is uncertainty about

A: These involve very distinct mechanisms. The private

López Obrador. I think the administration has good

market follows supply and demand. With respect to the

intentions but it does not have the necessary background

government, there are two scenarios. One is to operate in a

or expertise. Economic growth in 2019 was projected last

therapeutic area that is already established. The other is to

year to be 2.5 percent, now that has been lowered to 1.3

launch something that is entirely new in the market. In this

percent, or even lower. In the pharmaceutical industry,

second scenario, we need to convince the government that

growth below 3 percent can be debilitating. The growth

the treatment will be beneficial. This can take time: we have

basically comes with the rise of prices and units, not due

been working with the government for over a year to get

to investments. if you look at Latin America, 80 percent

Esmya introduced. Today in Mexico, women with a uterine

of the market for women’s health is in Mexico. If you look

fibroid condition receive treatment with medication while

at performance, Mexico could easily be the 10 th or 12th-

waiting for surgery. The waiting time for an operation is

largest market worldwide. But you need certainty, and this is missing. Overall, the dynamic is changing. Before, IMSS and the Ministry of Health worked together. Now,

Gedeon Richter is the largest pharmaceutical manufacturer in

it is IMSS as a single bloc. There is no certainty as to

Hungary and it specializes in gynecology drug developments.

whether the government will approve new products soon,

It is present in more than 38 countries with five manufacturing

because COFEPRIS is delaying approvals for new entrants

facilities, 29 representative offices and 38 sales subsidiaries

at the moment.

VIEW FROM THE TOP |

R&D INVESTMENT KEY TO COMPETITIVENESS VINCENZO D’ELIA General Manager of Laboratorios Alfasigma

Q: How does Alfasigma differentiate itself in Mexico and

A: Alfasigma was one of the first laboratories to be affiliate

where are its key business focuses?

with this program that now has more than 219 companies

A : We a re a n I t a l i a n co m p a ny s p e c i a l i ze d i n

participating. Through this program, Alfasigma is making

gastroenterology that aspires to develop on a global scale.

a commitment to offer job training and monetary support

Our differentiating factor is to ensure strong compliance

in collaboration with the government to young people

and to sell highly distinctive products. Today, if a company

who are starting their professional experience. It is a very

does not offer a differentiated product, it is going to find

interesting program and all companies should participate

it difficult to compete. Alfasigma’s business focus and

to contribute to the country’s talent development.

products will remain on primary care, although we do not discard the possibility of entering specialized care in

Q: How are generic medicines impacting your longer-

the future.

term strategy for Mexico? A: The only way to address the challenge from generics is

Q: Alfasigma is present in North America. What role will

through innovation. When a company constantly develops

Mexico play in expanding throughout the Americas?

new products that have a high differentiated value, it will

A: The next step is to consolidate the company in other

find a more effective way to compete in the market. The

Latin American countries. Alfasigma’s international division

day an innovative medicine company stops investing in

has a department for the Americas region, which stretches

innovation will be the start of the end for that company.

from the US to Patagonia, Argentina. The company is

Alfasigma does everything necessary to continue being

evaluating market conditions and the best way to strengthen

efficient and innovative in the market. We launch new

its presence in the region, whether through a subsidiary

products constantly.

or through a licensing deal. There are many attractive markets in Latin America where Alfasigma does not have

On the flip side of the coin, the government should invest

a significant participation but this will change. When that

in the necessary medicines and elements to contribute to

happens, Alfasigma will introduce its four therapeutic areas

the healthcare needs of its population. It is absurd that a

to all the countries in which it expands.

country like Mexico with its high potential and one of the top world economies has limited access to innovation.

Q: How important is R&D for Alfasigma and what are the

The starting point is to make people see that innovation

company’s research priorities?

is not an expenditure but an investment for the long-term.

A: Scientific research is one of the engines of development

Fortunately, the administration of López Obrador has

for Alfasigma. We want to continue innovating and

shown positive interest in investing in innovative products.

introducing new products to remain competitive and

Our pipeline does not include products that address

economically sustainable. Alfasigma is the result of a merger

Mexico’s epidemiological changes but that does not mean

between three Italian companies, Alfa Wasserman, Sigma-

our business development area is not considering it. If

Tau and Biofutura. This merger increased our investment

agreements and market conditions suggest that investing

in R&D, product innovation and business development,

in other therapeutic areas is good for the company, then it

while also providing a further investment to improve the

will look to introduce new products to its pipeline.

company’s manufacturing facilities. Alfasigma will continue to focus its R&D investment in gastroenterology. Laboratorios Alfasigma is the result of the merger between

Q: What benefits does Alfasigma expect from participating

ALFA Wassermann and Sigma-TAU, two of Italy’s most important

in the Jóvenes Construyendo el Futuro (Young People

pharmaceutical groups, along with Biofutura. It specializes in

Building the Future) program?

gastroenterology, rheumatology and cardiometabolics

| TECHNOLOGY SPOTLIGHT

LEI: THE FUTURE OF MEDICINE IN ADVANCED THERAPIES The horizons of medicine are defined by the possibilities brought by new therapeutic resources to attack diseases that have yet to be treated successfully. Gene therapy, cell therapy, tissue engineering and their combinations are collectively known as advanced therapies. Laboratorios de Especialidades Inmunolรณgicas (LEI) provides its services as a third party authorized by COFEPRIS. Since 1991, LEI has held a distinctive catalog of the most innovative market research tools and solutions, driven by requests from its customers. Advanced therapies have emerged to treat acute lymphoblastic leukemia in children with CART cells, including three-dimensional biological impressions to restore patient mobility. New opportunities, however, bring fresh difficulties. Entry to this market is restricted either by the absence of the definition of health regulation or by ignorance and insufficient interpretation of regulations, which can jeopardize the effect of sophisticated therapies on patients. LEI helps its clients navigate sanitary regulation. Its technological management model, supported by consolidated tools for the development and quality control of advanced therapies, resulted in LEI winning the 2018 National Prize for Technology and Innovation. With state-of-the-art infrastructure and a mature quality-management system, LEI meets international performance standards, leading its customers through the path of local and global health regulation.

GENERICS & OTCs

Nine out of 10 medicines sold in the country are generics. This market represents 53 percent of the total drug industry in Mexico. Because of its impact on human health, the pharmaceutical industry is one of the most controlled industries in the country and the world. Big Pharma companies are throwing their weight into the generics market, which could hamper the efforts of smaller manufacturers. This situation could also be fueled by the ratification of USMCA and a possible extension on patent protection periods for biotechnological medicines.

This chapter will analyze the challenges generics and OTC industries face in the Mexican market. It will also consider the complexities of the international market and how those affect the pharmaceutical industry. Through interviews with leaders and decision-makers, this chapter will clarify the opportunities for different players in the sector, from local to international manufacturers.

CHAPTER 4: GENERICS & OTCs

ANALYSIS: Generics Present Both Opportunities and Challenges

INFOGRAPHIC: Mexico’s Manufacturing Companies Grow Alongside Generics

VIEW FROM THE TOP: Gurulinga Konanur, Hetero Mexico

VIEW FROM THE TOP: Américo García, Apotex

VIEW FROM THE TOP: Rafael Maciel, AMEGI

VIEW FROM THE TOP: Alfredo Rimoch, Laboratorios Liomont

VIEW FROM THE TOP: Esteban Abad, Glenmark

VIEW FROM THE TOP: Juan José Aguirre, Grupo Bruluart

INSIGHT: José Díaz, Micro Pharmaceuticals México

VIEW FROM THE TOP: Anne Engerant, RB

ROUNDTABLE: How are You Differentiating Your Products in a Cost-Driven Market?

| ANALYSIS

GENERICS PRESENT BOTH OPPORTUNITIES AND CHALLENGES Generics are always an attractive alternative for those who need medication at accessible prices, be they individuals or healthcare systems. Their popularity has spurred a global generics market that was worth US$244.5 billion in 2017, according to Research and Markets

That is the case in Mexico, which has become an attractive

BIG OPPORTUNITIES, BIGGER CHALLENGES

market for generics manufacturers thanks to government

Another type of products that have significant potential in the

efforts to increase access to medications. During President

market are biosimilars. “Biosimilars are expected to change

Peña Nieto’s administration, COFEPRIS approved 590 generic

the industry and they have brought significant advantages

registries to address 71 percent of the most common mortality

to those countries in Europe and the Americas that have

causes in the country. In mid-2018, former Commissioner of

adopted them,” says Américo García, Managing Director

COFEPRIS Julio Sanchez y Tepoz stated that this strategy

Latin America of Apotex. Unlike small molecules that can

saved public institutions MX$26.1 billion (US$1.37 billion) and

be fully replicated, making the patented medication and the

allowed them to increase the number of acquired medications

generic equal in every way, biological molecules are much

from 4.4 million units to 24.9 million units per month.

larger, complex and cannot be fully replicated because they are produced by living organisms. For that reason,

The impact of generic medications extends beyond the

regulators have established a different set of requirements

public sector. “Previous administrations have invested in

for biosimilars: while a biosimilar cannot be exactly the same

generics, which amount to 86 percent of prescriptions in the

as the biotechnological drug, it must be highly similar in purity,

public sector. This has resulted in significant changes to the

molecular structure, bioactivity, safety and potency.

entire market, including public and private institutions and pharmacy chains,” says Rafael Maciel, President of the Mexican

Due to their nature, biosimilars are harder to research and

Association of Generics (AMEGI).

manufacture than generics. Moreover, there are complex patent processes stopping the commercialization of

Generics have also left their mark on the private sector,

biosimilars even after the patent has expired. For instance,

creating competition and opportunities. “The generics market

AbbVie’s Humira, which was the world’s best-selling

has grown exponentially in Mexico and Latin America due

medication in 2018 and earned its manufacturer US$19.9

to low prices and a boost from pharmacies. There are solid

billion that year, had three FDA-approved biosimilars by early

opportunities, particularly in the branded generics segment,”

2019. However, none are commercially available in the US or

says Esteban Abad, Vice President and Head of Upper Latin

Mexico and the situation is not expected to change soon.

America at Glenmark. Now, nine out of every 10 medications

In fact, according to the Initiative for Medicines, Access &

sold in the country are generics, according to IQVIA. While

Knowledge, AbbVie has filed 274 patents in the US for Humira,

their sales volume has quickly surpassed that of patented

49 percent of them after Humira’s first patent expired in 2014.

medications, generics represent only 53 percent of the

These patents can increase Humira’s market exclusivity until

medicines market by value because of their lower cost. Higher

2037, much longer than the original patent’s protected 20

investment in generics could bring even further savings. The

years counting from 1994.

Federal Commission of Economic Competition (COFECE) states that Mexicans would save MX$2.55 billion (US$133

A similar situation has occurred with several other biosimilars.

million) per year if penetration of generics doubled.

“[Biosimilars] have failed to enter many regions, such as the

GLOBAL MEDICINE SPENDING PROJECTION (2022) Original brands

Non-original brands

Unbranded

Other

Percentage

Value US$ billion

Global

1,415-1,445

Developed economies

915-945

Pharmerging economies*

345-375

Rest of the World

125-155

Source: IQVIA. *IQVIA defined Pharmerging markets as the 21 countries with less than US$30,000 GDP per capita and a five-year aggregate growth of over US$1 billion. These countries are: Algeria, Argentina, Bangladesh, Brazil, Chile, China, Colombia, Egypt, India, Indonesia, Kazakhstan, Mexico, Nigeria, Pakistan, Philippines, Poland, Russia, Saudi Arabia, South Africa, Turkey and Vietnam.

US, which has extremely high barriers for their introduction.

LOCATION OF PHARMACEUTICAL COMPANIES

The story is similar in Mexico,” says García. Not all markets are

32% Mexico City 20% Jalisco 9.5% State of Mexico 38.5% Other

the same. After Humira’s patent in Europe expired in October 2018, four manufacturers were quick to introduce their generic version in the region. But in Mexico, their approval might be more complex thanks to recent changes introduced to the yet-to-be-ratified USMCA that extend the protections for the clinical data of biotechnological products. This move was greatly frowned upon by the local pharmaceutical industry. “We have been working alongside generics associations from the US and Canada to fight against these extra 10 years of

Source: INEGI

data protection. This extension will lead to longer wait periods for patients to access biosimilars and will maintain higher

Director of ANAFARMEX. For comparison, IMSS provided

prices in the market,” says Maciel.

between 180,000 and 185,000 daily consultations, said Patrick Devlyn, President of the Health Commission at the Business

Despite the challenges that have complicated the entrance of

Coordinating Council, to El Universal in mid-2019.

biosimilars to Mexico, many see opportunities ahead. National and international pharmaceuticals, including Neolpharma,

Generics are expected to continue growing and penetrating

Liomont, Probiomed, Sandoz, Amgen, Pisa Farmacéutica and

the Mexican market. “The country’s economic conditions do

Silanes, are investing in the development of biosimilars for the

not allow people access to patented products but for those

local market. The development and introduction of biosimilars

with enough purchasing power, branded generics represent

to the local healthcare system can bring savings to patients

significant savings in out-of-pocket spending,” says Abad.

who pay out of pocket and to the public healthcare system.

MADE IN MEXICO LOCAL STRENGTH

Mexico is gradually becoming a generics manufacturing

Mexico is the second-largest pharmaceutical market in Latin

powerhouse. The country now ranks as the 25th-largest

America and the 12 in the world. The Mexican public sector,

manufacturer in the world with a production valued at US$4.74

which includes IMSS, ISSSTE, PEMEX, SEDENA, SEMAR

billion in 2017, according to ProMéxico. The country now has

and others, is the country’s largest buyer of medications. In

795 pharmaceutical companies, according to INEGI, most of

2019 the Federal Administration budgeted MX$79.42 billion

them clustered in three states: Mexico City, Jalisco and State of

(US$4.16 billion) for the acquisition of medications, according

Mexico. The sector now represents 1.4 percent of the country’s

to SHCP. Public institutions are heavily reliant on generics

manufacturing GDP. Moreover, Mexican production of generics

to provide care to the millions of people they care for. As

is expected to increase and reach a value of US$9.48 billion

Maciel says, generics and biosimilars “amount to 86 percent

by 2025, according to ANAFAM.

of prescriptions in the public sector.” Moreover, Mexico has the lowest expenditure in healthcare out of all 35 OECD countries

There are bumps on the road, however. First, “the linkage

at a total of only US$1,080 annually per person. A significant

process for patents is extremely unclear and inefficient,”

percentage of that expenditure is made out of pocket by

explains Maciel. The second is the USMCA’s additional 10-

patients without access to social security. The country has the

year protection for data on biotechnological products, which

second-highest out-of-pocket costs out of all OECD countries,

may delay the introduction of biosimilars. Finally, the latest

which is 41 percent of the country’s health expenditure.

medication tender held in June 2019 which reduced prices by 8 percent and separated distribution from manufacturing.

These conditions have created a fructiferous environment

The tender was heavily criticized for accepting bids

for generic, less-expensive medications. Many of these are

from Asian countries, as local manufacturers claim that

available at the growing number of pharmacy chains, such

those products are less expensive but follow unethical

as Farmacias del Ahorro, Farmacias Similares, Farmacias

manufacturing practices.

Benavides, Farmacias Guadalajara and Farmacias San Pablo, among many others. “Farmacy chains offer generics at very

While there are challenges, there are also opportunities for

competitive prices. Moreover, they offer free doctor’s visits,”

generics. For instance, during this tender “62 percent of the

says Maciel. Pharmacies at the point of sale now surpass

product keys were deserted, which will create a shortage of

IMSS, Mexico’s largest public healthcare service provider, in

medications at public institutions that will force patients to

the number of daily doctor’s consultations. “These doctors are

head to the private sector,” says Maciel. Mexico’s growing

writing over 400,000 prescriptions per day and the number

population will need a large number of medicines, especially

will continue growing,” says Marcos Pascual, Commercial

as people get older and waistlines keep increasing.

| INFOGRAPHIC

MEXICO’S MANUFACTURING COMPANIES GROW ALONGSIDE GENERICS Mexico has a strong medicine manufacturing arm that supplies

medicine market’s value. Medicine production is expected to

the entire country and exports to other parts of the Americas.

continue growing but as the public sector opens tenders to

About 95 percent of manufactured medicines are generics

countries that do not have FTAs with Mexico and offer lower

and can cost up to 80 percent less than their patented variant.

prices, manufacturers are looking to increase exports and

However, these products represent only 53 percent of the

sales to the private sector to continue growing.

MEXICO'S PHARMACEUTICAL MARKET (US$ billion)

Expenditure on medication between 2012 and 2018

15.9

9.48

Value the generics market is expected to reach by 2025

4.74

Pharmaceutical production in 2017

76% Medicines 16% Medical supplies 8% Laboratory supplies

-28.6% 0.4%

PERCENTAGE OF MARKET EXPENSES BY TYPE OF PRODUCT (2017)

53% Patented medicines 47% Generic medicines

IMSS AND ISSSTE’S MAIN MEDICATION SUPPLIERS THROUGH TENDERS (2012-2018) 0

100

Pharmaceutical sales in 2017

4.41

35.2% Grupo Fármacos

2.4% Laboratorios de Biológicos

11.6% Farmacéuticos Maypo 11.4% Distribuidora Internacional 5% Ralca 5% Comercializadora de

2.3% Compañía Internacional

2.9% Savi Distribuciones

20.5% Others

Especializados

Budget for medication in 2019

4.16

Value of the generics market in 2015

3.33

Productos Institucionales

y Reactivos Médica

2.1% Comercializadora Pentamed

1.6% Vitasanitas

The sector represents 1.4 percent of Mexico’s manufacturing GDP

DISTRIBUTION OF PHARMACEUTICAL BUSINESSES

25th

leading pharmaceutical exporter

3% Nuevo León

largest pharmaceutical market in Latin America

largest pharmaceutical market in the world

21% Jalisco

5% Puebla

10% State of Mexico

Source: ProMéxico, CIEP, COFECE, COFEPRIS, SHCP and ANAFAM

29% Mexico City

4% Morelos

TIMELINE FOR THE INTRODUCTION OF A GENERIC MEDICINE TO THE MARKET

First “generic” sanitary registration

16 months

Patent expires

First market launch of the generic medication

10 months

-10

-20 -25 -30

12 months

• Generics

-28.6%

-15

-23.2%

Market penetration

-5

-20.6%

Price variation*

21.4%

1.3%

12.7%

6 months

2.5%

8.3%

0.4%

GENERICS AFTER PATENT EXPIRATION

• Patents

95 percent of medicines manufactured in Mexico are generics

24 months

*The baseline price is the cost of the patent medication one month after its release

COST DIFFERENCE BETWEEN PATENT AND GENERIC DRUGS IN MEXICO (percentage)

MAIN PHARMACEUTICAL EXPORT DESTINATIONS

51 Others

Infectious

Neurological

70 Pulmonary

39 Oncologic

55 Endocrinology

64 Cardiovascular disease

Diabetes

MEXICO’S PHARMACEUTICAL EXPORTS

73%

Retail medicines

10%

Wadding, gauze and bandage

Antivenom and vaccines

Pharmaceutical product and preparations

Others

100

46.3% Other 6.7% Colombia 10.3% Panama

36.7% US 0

Mexico has 795 pharmaceutical businesses

| VIEW FROM THE TOP

PROMISING FUTURE FOR APIS AND BIOSIMILARS GURULINGA KONANUR Director General of Hetero Mexico

Q: How has Hetero Group used its position as a global

generic manufacturers are entering the market, which is

powerhouse in retroviral medication to penetrate the

beneficial for us in terms of API sales.

Mexican market? A: Pharmaceutical businesses always require a long-term

Q: Mexico has a strong generics market but how competitive

vision. In 2018, Hetero Mexico consolidated its raw materials

is the market for APIs?

segment with excellent results, which led us to introduce

A: There are few API manufacturers in Mexico. As a result, we

more products to the Mexican market. Globally, Hetero is

hold strong ground in Mexico. The quality of a medication

very strong in the retroviral segment although this was

relies entirely on the quality of the API. Developing an

not fully developed in Mexico until 2017. During the past

API requires significantly more investment in R&D than in

couple of years, we have greatly strengthened our retroviral

manufacturing of the finished product. We invest heavily in

portfolio and now we have the lionâ&#x20AC;&#x2122;s share of the market

R&D and we often begin planning them over 10 years before

in active pharmaceutical ingredients (API) in Mexico. This

they go off patent. This help us to offer products to clients at

market is extremely competitive and especially with many

a much advanced or early stages of product development. We

patents expiring, there is an increased penetration of

see the biggest competition coming from Asian companies

generic alternatives. Until 2017, the retroviral market was

that offer their products at a low price, but lack in offering

partly monopolized by patented medications but patent

great services and speed to reach the market. Hetero has a

expirations have opened the market for many generic

500ha chemical complex in Vizag, India that manufactures

companies. As a result, we expect our market share to

24/7, which allows us to offer a high volume of high-quality

continue growing in Mexico.

products at affordable costs.

Q: What are your expectations for growth in the

Q: What new products will Hetero Mexico introduce to the

retroviral market?

Mexican market in 2019?

A: Thanks to their affordable cost, generics increase access

A: We will focus on products that go off patent, including

to life-saving medications. Recently, some areas in Mexico

retroviral, oncologic and, cardiometabolic solutions. The latter

saw shortages of HIV medication and companies were

is a significant market area in Mexico and Hetero Mexico can

unprepared to address the demand for the medication once

introduce top-quality products at affordable prices. We offer

patents expired. Generics manufacturers must always be

more than 305 different products but our strategy is to focus

prepared to produce medications as soon as this happens.

on specialty, high-tech niches.

Otherwise, they lose time, which can cost them potential business. The market for retroviral medications is expected

Q: What are Hetero Mexicoâ&#x20AC;&#x2122;s growth expectations in the

to grow in volume. As innovative drugs go off patent, costs

coming years?

are lowered thanks to the introduction of generics, which

A: The pharmaceutical industry has been holding back due

allows public institutions to buy more products for the same

to the climate of uncertainty that permeates the country.

amount of funds. We also expect the market to grow in the

However, we expect Hetero Mexico will continue growing

private sector as more individuals start buying generics

thanks to patent expirations. We expect to grow as long as

due to availability of medication at affordable prices. More

the government does not change existing manufacturing and importing regulations. Our main competition used to be Chinese companies due to their low prices. However,

Hetero is an Indian generics manufacturer present in over 126

we have seen that the country is facing issues concerning

countries. It specializes in antiretroviral therapy drugs for HIV/

environmental regulations that forced the closure of several

AIDS treatment. Hetero has over 25 years of experience in the

manufacturing plants. Meanwhile, Indian manufacturing, which

sale of APIs, generics and biosimilars

follows strong good manufacturing practices, is booming.

VIEW FROM THE TOP |

BIOSIMILARS AN OPPORTUNITY TO TRANSFORM THE PHARMACEUTICAL MARKET AMÉRICO GARCÍA Director General of Mexico and Latin America at Apotex

Q: How has Apotex advanced in growing its chronic

system is to increase public investment. It is not possible to

degenerative diseases portfolio?

achieve healthcare for all by reducing the budget.

A: We maintain our efforts to penetrate the market for central nervous diseases medications, which has not been

Q: What trends are affecting the generics and biosimilars

easy. Doctors in this area perceive us as newcomers so it has

industry worldwide and in Mexico?

been hard to convince them to use our medications. This

A: Biosimilars are expected to change the industry and they

year, we will focus on strengthening our portfolio. We also

have brought significant advantages to those countries

launched a new division in Mexico called “cardio-analgesic”

in Europe and the Americas that have adopted them. We

that handles both cardiology and analgesic products.

launched a biosimilar in Canada that resulted in significant savings to its healthcare system. However, these products

Q: Considering Mexico’s epidemiological profile and

have failed to enter many regions, such as the US, which has

the change in the population pyramid, what business

extremely high barriers for the introduction of biosimilars.

opportunities do you see in the coming years for Apotex?

The story is similar in Mexico. While some products have been

A: Mexico is an interesting market. Part of it behaves as an

approved, their registration takes a very long time. We are

emerging market and another as a mature one because

in a transition period for the regulation and acceptance of

the change in the population pyramid is more common

biosimilars. Generics, on the other hand, are growing at an

to mature markets. As Mexicans live longer, they are

accelerated pace. A trend we see in the Latin American market

much more prone to chronic neurodegenerative diseases,

is the consolidation of pharmacy chains, which later release

which will undoubtedly increase, along with diabetes

their own branded generics. This is destroying independent

and cardiometabolic diseases. At the same time, there is

pharmacies and generating oligopolies. For instance, Chile

a significant poverty rate in the country. This segment of

has three large pharmacy chains that control most of that

the population is more sensitive to acute diseases, such as

market. We are beginning to see this phenomenon in Mexico

dengue. As a result, Apotex has invested in products for both

and we have to prevent it to avoid the death of independent

markets through the generation of specialized strategies.

pharmacies, which will eventually hurt patients.

Q: How is Apotex contributing to the administration’s goal

Q: What are Apotex’s main goals for 2019 and what are your

to increase access to medications?

expectations for the future of the pharmaceutical industry?

A: Universal healthcare coverage should be the ultimate

A: Over the past five years, we have positioned Apotex in the

goal of any healthcare system. However, this will be hard

Mexican market and doubled our sales. In the short term, my

to achieve with the current state of the Mexican healthcare

goal is to double the size of the company again, following

system. It is necessary to develop a long-term strategy that

our quality commitments to continue benefiting patients.

operates no matter which party is leading the country. The

To do so, we will focus on incorporating other therapeutic

former administration made an effort to increase patient

areas, exploring new market niches, growing the areas

interchangeability among public institutions, which was a

where we are strong and creating a closer relationship with

good first step. It would also be convenient to merge public

our current clients. In the future, we want to see Mexican

healthcare institutions, which will be a complex and long-

institutions strengthened and rule of law continued.

term process that must be done in a sustainable way. The current administration has greatly reduced the budget

Apotex manufactures and commercializes generic and

for several areas in the healthcare sector. Among OECD

innovative drugs in more than 115 countries. It has over 1,100

countries, Mexico is among the lowest investors in healthcare

active projects that represent more than 500 molecules in

as a percentage of GDP, so the only solution to improve the

50 countries

| VIEW FROM THE TOP

LOWER COSTS LEAD TO BOOMING GROWTH FOR GENERICS RAFAEL MACIEL President of AMEGI

Q: How can generics become a tool to support access to healthcare services in Mexico? A: Generics and biosimilars have brought significant savings to patients. Previous administrations have invested in generics, which amount to 86 percent of prescriptions in the public sector. This has resulted in significant changes to the entire market. Generics have also gained significant strength in the private market, especially as recent public tenders have bought fewer products than the population needs. Tenders for 62 percent of the products were deserted, which will create a shortage of medications at public institutions that will force patients to head to the private sector. Q: What regulatory changes would AMEGI like to see? A: We are lobbying on two fronts. The first is with COFEPRIS and IMPI because the linkage process for patents is extremely unclear and inefficient, which has hurt the local pharmaceutical industry. Through linkage, many patent protections have been extended for two extra years. The existing regulations of both institutions are not explicit for manufacturers and although they offered changes, we have not seen this to date. The second is through proposals sent to the Senate and the Chamber of Deputies to explain the linkage process and propose better alternatives that can be applied in a more efficient and transparent way. Our objective as an association aligns with the presidentâ&#x20AC;&#x2122;s goal to increase access to healthcare services and safe, quality medicines.

The Mexican Association of Generics (AMEGI) is a private organization created in 2002 to represent the interests of six generic manufacturers operating in Mexico: Allen, Apotex, Hormona Laboratorios, Randall Laboratorios and TEVA

VIEW FROM THE TOP |

MEXICAN PHARMACEUTICALS DEMAND GOVERNMENT SUPPORT ALFREDO RIMOCH Director General of Laboratorios Liomont

Q: What is the reach of Laboratorios Liomontâ&#x20AC;&#x2122;s core business?

have gotten more complicated for participating companies.

A: We are active in various areas of the market, with our core

During the tender approvals in October 2018, we had a lot

business being branded generics. In this area, we are market

of prime material and finished products lined up, but the

leaders for a number of products. We also offer a diverse line

government recently stopped buying these products. What

of OTCs. We provide internationally-recognized brands and

alarmed us in the last tenders was that reference prices

participate in several markets in Central and South America.

had lowered to such a level that in most cases they were

We are also active in the European market, where we have

unattainable due to production costs. I think there needs to be

been approved by EMA and have a presence in Spain,

more understanding from the new administration regarding

Portugal and Italy. Similarly, we have been audited and

increased manufacturing costs due to stronger regulations.

verified by the FDA in the US, where we sell OTC products. The government keeps insisting on more investment for Apart from generics, we have built state-of-the-art facilities

quality control but at the same time, it expects prices to

for the production of biosimilars and are also working on

go down. This could make the entry of foreign producers

the development of vaccines. In Mexico, we have the rights

more unfair if they do not adhere to the same regulatory

to manufacture and distribute a recombinant vaccine for

standards for manufacturing. We are strongly committed

influenza that is unique in the world.

to Mexicoâ&#x20AC;&#x2122;s well-being and industrial development. The public sector should have a primary role in strengthening

Q: Laboratorios Liomont has inaugurated a new plant for

Mexican research and Mexican companies to ensure future

sterile and recombinant products in Ocoyoacac, Mexico

accessibility to high-quality treatments.

State. What does this mean for the company? A: Laboratorios Liomont has taken significant steps in

Q: What is the status of new-product approvals?

biotechnology. We just finished constructing this state-of-the-

A: At the moment, COFEPRIS is a black box. We have products

art plant with the latest technology for sterile products. While

ready and have applied for inclusion into the national registry, but

still subject to approvals, we have already started doing the

we still do not have a response. Officially, It can take between

technology transfer for fill and finish of recombinant products.

one to six months before you get a reply from the commission,

We are strong believers in collaboration with academic bodies

even if the product meets all the necessary requirements. We

in Mexico and other countries. One example of this is our

have been in some processes for over a year but do not know

work with UNAMâ&#x20AC;&#x2122;s biotechnology institute. In Cuajimalpa, we

their status yet. Especially when companies are expecting to

also built a biotechnology plant that will produce monoclonal

enter markets where patents have expired, delays in approvals

antibodies, which will then be turned into finished sterile

only help multinationals maintain a monopoly over certain

products at the Ocoyoacac site. The latter has been designed

treatments, which increases barriers and costs for the general

and built to manufacture large volumes of biosimilars and

population. Also, we lack a regulatory process that promotes

recombinant vaccines using the latest technologies based on

innovation. CONACYT is not supporting R&D in the industry, so

isolators. Biotechnological medications produced at this plant

our collaboration with the council no longer exists. Sadly, this is

will offer vital alternatives for the Mexican population. Having

pushing prestigious researchers to move to other countries to

these alternatives available will also make it possible for the

continue their work there.

government to make significant savings in its buying schemes. Q: Do you feel the government needs to take a more active

Laboratorios Liomont is a Mexican pharmaceutical company that

stand in supporting Mexican pharmaceutical companies?

has been developing, producing and marketing branded generics

A: In terms of volume, the government has traditionally been

for a diverse range of applications for over 80 years. The company

a major buyer of our products. Since the last elections, things

is present in Central and South America, Europe and the US

| VIEW FROM THE TOP

BRANDED GENERICS COULD UNDERPIN UNIVERSAL ACCESS TO HEALTHCARE ESTEBAN ABAD Vice President and Head of Upper Latin America at Glenmark

Q: What benefits can Glenmark bring to Mexican clients

more profitable to specialize in pneumology, dermatology

and how does it offering differentiates from other local

and oncology.

and international manufacturers? A: Glenmark’s biggest differentiator against other Indian

Glenmark has a different portfolio for each country,

companies in Latin America is that all its executives

depending on the market’s opportunity areas. It has

are local and come from Big Pharma companies.

experienced rapid growth, particularly in pneumological

Glenmark aspires to be a Big Pharma company and is

medicine, and penetration has been favorable thanks to

strengthening its operations through pharma know-how

the differentiation of Glenmark’s products. Since branded

and experience. Initially, the company wanted to cover

generics companies offer very similar products in large

different therapeutic areas in Latin America but it was

markets like Mexico, Glenmark believes the best strategy is to offer highly differentiated products at affordable prices. Our flagship product, Misdapre Rac, is the combination of

Glenmark is headquartered in Mumbai, India, and was founded in

two drugs (Montelukast and Levocetirizine) that already

1977 as a manufacturer of generic drugs and active pharmaceutical

exist in the market but no other company has them

ingredients. In 2009, the company arrived to Mexico focusing on

together. Our other differentiated product is Nebzmart,

pneumology, oncology and dermatology

which is a portable nebulizer.

VIEW FROM THE TOP |

COMPETITION FORCES SMALLER PLAYERS TO UP THEIR SERVICE GAME JUAN JOSĂ&#x2030; AGUIRRE Commercial Director of Grupo Bruluart

Q: How have you advanced in your goal to increase sales

products, including patented medications. We have

of paracetamol and diclofenac?

also increased the number of campaigns we run to raise

A: We are still focused on the international market.

awareness about health and nutrition.

Unfortunately, we are just exporting small volumes through distributors in a few Latin American countries. We have

Q: What is your view on lengthening licenses for patents

not been able to get big contracts for generics, yet. We

and the inherent risk of creating monopolies and raising

will have meetings throughout 2019 with associations of

medicinal costs?

distributors in South America. The US is also a priority for

A: Twenty years is enough time for pharmaceutical

us, even though we might face some challenges in terms

companies to recover their investment and gain resources

of logistics. We would also like to export our products to

to develop new medicines. Efforts to lengthen these

Southeast Asia.

patent licenses have impacted us directly and indirectly in terms of costs. Pressure has also elevated standards in the

Q: What are your views on overuse of antibiotics, painkillers

generics market in management of stocks and distribution.

and anti-inflammatory medication in Mexico?

It is a delicate balance and there must be an incentive for

A: I do not necessarily see this trend leading to a reduction

development and the recovery of investment. But we

in effectiveness or more resistance in the body. What I

must also ensure that medications are affordable for the

see is that people often use these medications in wrong

population. In the US, development of new medications is

dosages and for conditions for which they might not be

supported by a financing mechanism covered by insurance

intended. This makes the treatment less effective. This

agencies. But this is not easy to recreate in Latin America

problem is mainly rooted in the fact that Mexicans have

where spending on medication is largely out-of-pocket and

a tendency to make medical decisions without consulting

insurance coverage for medication is minimal.

a doctor. People have a fever or a headache and take pills. They continue to self-medicate, with 70 percent of

Q: What are your expectations regarding out-of-pocket

medication used this way. Having doctors at the point

expenditure?

of sale has been an effective way to mitigate this issue.

A: In the short term, the current restructuring of national

Pharmacy clients can now consult a doctor for a small

health institutions will lead to higher out-of-pocket

fee and receive a professional diagnosis. The prescription

spending. Even though we have had a new government

does not have to be a new medication of some innovative

for over six months, institutions are a bit paralyzed still. The

molecule. It can be paracetamol but at a better dosage and

government is trying to restructure its purchasing processes

with indications of use.

and this will be reflected in many people who formerly went through Seguro Social and ISSSTE now having to spend

Q: What are your strategies to remain competitive against

their own money on medication. Institutions will eventually

large pharmacy chains?

start operations again, but it will take time and there will

A: Competition is inevitable. On the one hand, it has

be a great deal of uncertainty in the meantime. We do

a positive effect because it forces smaller pharmacies

not know whether the model the government wants to

to level up their service. Before, clients had only one

introduce will work or not and the information is still limited.

pharmacy in their neighborhood. It could be good or bad, but it was the only option. Now there are two or three and competition has gone up. It has forced us to

Grupo Bruluart is a Mexican group specialized in generics. It has

make changes too. We diversified our portfolio, offering

four divisions: Bruluagsa, a medicine laboratory; IM Bruluart a

new products in areas such as food supplements and

medication manufacturer; Brudifarma, a distributor and logistics

prevention. People will now find more specialized

operator and Farmacias Gi, a pharmacy chain

Liomont robotized warehouse, Ocoyoacac, State of Mexico

INSIGHT |

HIGHLY DIFERENTIATED PRODUCTS FOR MARKET COMPETITIVENESS JOSÉ DÍAZ Executive Director of Micro Pharmaceuticals México

Data sciences company IQVIA estimates there are

Díaz believes the emerging business opportunities in

approximately 50 generics companies competing in

the private sector are partly a result of public policy

the Mexican market, all of them actively working to

changes and partly thanks to the country’s economic

attract consumers looking for lower prices. “Under these

environment. “Given the current purchasing policies,

circumstances, product differentiation becomes imperative

growth opportunities in the public sector remain

to remain ahead,” says José Díaz, Executive Director of

uncertain,” he says. The country, nonetheless, represents

Micro Pharmaceuticals México.

an important market for international companies. “Mexico is an important country and we are here to stay,” Díaz says.

Micro Pharmaceuticals started in 1973 as a generics company based in India and today, its products are present in 60 countries, including Mexico through a subsidiary known as Micro Pharmaceuticals México (Micromex) that focuses on anti-infectives, cardiovascular products, antihistamines and nervous system therapies. The company is recognized by different regulatory authorities across the world, including ANVISA in Brazil, TGA in Australia, MHRA in the UK, FDA in the US and COFEPRIS in Mexico. Accreditation by several regulatory agencies has given added value to the company’s products. “Our headquarters exports to heavily-regulated countries. We prioritize good manufacturing practices to not lose our certifications,” says

“We will maintain our price and high-quality policies to

“

compete with reasonable results.”

The constant price war and the sector’s sustained and relevant market growth have increased the attractiveness of participating in the private sector”

Díaz. The same generic products that are sold in Mexico, are sold in all countries where Micro Pharmaceuticals has

Although the generics industry will remain a strong ally

a presence. “This forces us to have a single production

for the government, Díaz says public policies need to

process for all customers.”

promote quality in medicines. “Health authorities should put more weight on the quality of medicines and see

A single manufacturing chain also has its challenges as

price as a second priority. Savings in purchasing cannot

market opportunities and regulations differ from one

supersede quality because people’s health is at stake,”

country to another. Since the 1990s, the Mexican government

says Díaz.

has chosen to incentivize the generics market in the country because the purchase of these medicines represents up to

Public policies need to reflect that health comes first,

80 percent savings in medicines, according to COFEPRIS.

Díaz adds. Increasing the quality requirements for generic

However, Micro Pharmaceuticals México believes the private

products would result in greater benefits for patients.

sector also is presenting increasing opportunities for the

Moreover, Díaz foresees opportunities for high-quality

generics market. “The constant price war and the sector’s

differentiated generics. “Our branded generics are well-

sustained and relevant market growth have increased the

positioned in the market and the final consumer is

attractiveness of participating in the private sector,” says

increasingly choosing them over other options,” he says.

Díaz. However, growing market participation should not be

However, patient education could have a stronger role in

the goal. “The objective should be a quality competition,

helping people to be aware of their purchase decisions. “If

where companies work to manufacture products that

COFEPRIS would send information to the final consumer on

ensure the fastest recovery, with the least side effects at

the importance of quality in generics, then patients would

an affordable price.”

be better informed when making their purchasing decision.”

| VIEW FROM THE TOP

PAVING THE WAY FOR A HEALTHY SEX LIFE ANNE ENGERANT Senior Vice President and General Manager LATAM Health of RB

Q: How is Mead Johnson Nutrition performing after being

recommended for young babies. We are very proud to have

acquired by RB?

launched sugarless variants of products like ChocoMilk or

A: After the acquisition of Mead Johnson Nutrition in May

Cal-C-Tose, which offer a healthier choice and we hope will

2017, we created two separate divisions. One is home hygiene

contribute to reducing diabetes and obesity among children.

and the other is health, which includes Mead Johnson’s portfolio of nutrition, our OTC brands and our sexual well-

Regarding our OTC portfolio, our strategy is to introduce better

being products. I have been responsible for the health

molecules to Mexico to develop our brands and increase our

division in Latin America since January 2018. It is always

market share. We launched Graneodin F, introducing a new

a journey to integrate and create a new business structure

molecule Flurbiprofen that will work along with benzocaine,

due to the implications in terms of culture, data systems and

which was the traditional molecule we used in Mexico. We also

ways of working. 2018 was a positive year and even though

launched ibuprofen products to complement our paracetamol

some brands were suffering from a lack of focus after this

product lineup Tempra and the equivalent of our Gaviscon

integration, we grew close to a double-digit rate.

technology Picot, marketed under the name of Picot Adv.

In the area of baby nutrition, rather than breast milk, we

Q: What strategies are you implementing to eliminate the

consider that our true competition are bad nutrition

stigma around the use of condoms?

practices. There is a billboard campaign that focuses on

A: Mexico is one of the worst countries in the world in

the dangers of giving alcohol to infants but there are other

terms of teenage pregnancies and unfortunately condom

substances like coffee, soda or even cow’s milk that are not

use is not yet at the level we can find in other countries. The previous administration spent a large amount of resources to promote the use of condoms but the usage

Reckitt Benckiser (RB) is a British consumer goods manufacturer

rate has remained stable since 2015. Changing habits is

that participates in segments that include home care, hygiene

not easy. There is only so much we can do as a brand,

and health. The company is present in over 60 countries through

which means we have to work in partnership with the

brands like Durex, Mucinex, Nurofen and Scholl

government, customers and other industry players.

ROUNDTABLE | Stronger regulations concerning generics production, along with high costs of patent medications, have led to a boom in the Mexican generics market, which is the largest in the medications segment in terms of sales volume. While the market for generics is expected to continue growing, challenges are also on the horizon, especially considering that customers are increasingly looking for the lowest available price. Mexico Health Review spoke with healthcare leaders and experts to get their opinion on how to differentiate in a price-driven environment.

HOW ARE YOU DIFFERENTIATING YOUR PRODUCTS IN A COST-DRIVEN MARKET? 95

There are few API manufacturers in Mexico. As a result, we hold strong ground in Mexico. The quality of a medication relies entirely on the quality of the API. Developing an API requires significantly more investment in R&D than in manufacturing of the finished product. We invest heavily in R&D and we often begin planning them over 10 years before they go off patent. This helps us to offer products to clients at a much more advanced or early stage of product development. We see the biggest competition coming from Asian companies that offer their products at a low price, but they lack great services and speed to reach the market. Hetero has a 500ha

GURULINGA KONANUR Director General of Hetero Mexico

chemical complex in Vizag, India that manufactures 24/7, which allows us to offer a high volume of high-quality products at affordable costs.

Regarding our OTC portfolio, our strategy is to introduce better molecules to Mexico to develop our brands and increase our market share. We launched Graneodin F, introducing a new molecule Flurbiprofen that will work along with benzocaine, which was the traditional molecule we used in Mexico. We also launched ibuprofen products to complement our paracetamol product lineup Tempra and the equivalent of our Gaviscon technology Picot, marketed under the name of Picot Adv.

ANNE ENGERANT Senior Vice President and General Manager LATAM Health of RB

Mexico is an interesting market. Part of it behaves as an emerging market, while another as a mature one since the change in the population pyramid is more common to mature markets. As Mexicans live longer, they are much more prone to chronic neurodegenerative diseases, which will undoubtedly increase along with diabetes and cardiometabolic diseases. At the same time, there is a significant poverty rate in the country. This segment of the population is more sensitive to acute diseases, such as dengue. Apotex has invested in products for both markets through the generation of specialized strategies.

AMÉRICO GARCÍA Director General of Mexico and Latin America at Apotex

Fujifilm SonoSite X-Porte ultrasound system

HEALTHCARE 4.0

Digitalization of the health sector began with the most fundamental elements, such as the introduction of medical devices and then moved to more complex solutions that integrated technological advances like Big Data, AI, augmented reality, virtual reality and IoT. The next challenge for the industry is to communicate the various technologies that a business uses at various care levels and to help the company interact with other important industry players. While the development of new technologies is advancing at an accelerated rate and increasing frequency of implementation, regulation is also becoming a factor to take into account. However, there is no doubt that Healthcare 4.0 is here to stay.

This chapter shines a light on the trends that are transforming the health industry and the untapped opportunities that will continue to shape it. The chapter also presents the greatest concerns for those companies that seek to adopt new technologies and the recommendations that experts make regarding their management.

CHAPTER 5: HEALTHCARE 4.0

100

ANALYSIS: Technology: Transforming and Disrupting the Care Ecosystem

102

VIEW FROM THE TOP: Xavier Valdez, IQVIA

103

INSIGHT: Antonio Carrasco, PLM Latina

104

ROUNDTABLE: How is Your Company Disrupting Healthcare Practices?

105

INSIGHT: Alberto Wicker, Signufarma

106

VIEW FROM THE TOP: Elie Haibi, Ominé

107

VIEW FROM THE TOP: Morgan Guerra, Previta

108

VIEW FROM THE TOP: Javier Guadarrama, Health and Benefits, a Grupo Promass Company

109

VIEW FROM THE TOP: Guillaume Corpart, Global Health Intelligence

110

INSIGHT: Jorge Camargo, Ecaresoft

111

VIEW FROM THE TOP: Charles Nader, Doc.com

111

VIEW FROM THE TOP: Carlos Escalante, Pen Healthcare (Punto Pen)

| ANALYSIS

TECHNOLOGY: TRANSFORMING AND DISRUPTING THE CARE ECOSYSTEM The transformation of the health field began with its digitalization and automation. Healthcare 4.0 employs much more complex and advanced technologies, including Big Data, augmented and virtual reality, chatbots and IoT, and will eventually virtualize multiple levels of care, connect devices and move to Personalized Medicine

100

Technology is revolutionizing healthcare, from the patient’s

successfully incorporated technology and information

home to the operating room, reshaping the healthcare

systems into their diagnostic practices.” In comparison,

landscape and creating a paradigm shift away from hospitals

other markets behave differently in the number of players

and institutions to be delivered virtually through telemedicine.

that accept and how these interact with each other. “In the

With this shift, services are being tailored to individuals rather

US, for instance, care is provided in a ‘closed’ system where

than being designed based on statistical averages. “Using

tests, primary, secondary and tertiary care are supplied by

advanced diagnostics, we can gather a specific picture of the

a single provider,” Nieto says. “In Mexico, a patient receives

patient and their condition. This allows us to develop medicine

primary care from one provider, testing from a different one

that is highly personalized to their profile,” says Andrés

and secondary or tertiary care with yet a different provider,

Bruzual, General Manager of Roche Pharmaceuticals Mexico.

which we call an ‘open’ system.” Therefore, the sum of the rules of interaction, the number of players and the dynamics

Although digitalization is impacting all health fields, the speed

of the market directly affect the level of digitalization and the

with which players adapt varies greatly. “The healthcare sector

adoption of technologies for industries.

is indubitably migrating toward digitalization and technology but each player is moving at its own pace,” says Miguel Nieto,

Insufficient diffusion of new technologies, according to a

President of Latin American Region of Carestream. The

report on Digital Technology Diffusion 2018 by the OECD,

purpose of digitalization is also different for each stakeholder,

has been cited as one possible reason for weak productivity

with some seeing it as an individual process and others as a

performance over the past two decades. The international

collaborative process. “We see a mixture of different systems

organization recommends the promotion of market incentives

as each player uses the best one for their own purposes. While

that reinforce adoption of digital technologies and public

some are investing in technology and are implementing

policies that foster the adaptation of technologies, market

software that favor interconnection with other systems, the

access, fair competition and efficient reallocation of labor

result is a complex hybrid,” Nieto says.

and capital.

The development of a country’s economy and markets

SECURITY CONCERNS

plays an important role in the degree of digitalization

The security of data and information has become a topic

and transformation of its health industry. Nieto says that

of great importance in recent years as the 21st century has

“developed markets, such as Europe and the US, have

become a witness to historic data breaches and hacks. The most recent hack involved the bank Capital One, which

DIGITAL ADOPTION PER ECONOMIC SECTOR

suffered a breach that impacted more than 100 million people,

Agriculture, forestry and fishing

compromising information such as social security numbers,

Food products, beverages and tobacco

bank account numbers, addresses, credit scores and more.

Accommodation and food service activities

Other attacks include the epic breach at Yahoo in 2013 that

Chemicals and chemical products

compromised the data of 3 billion people, First America

Pharmaceutical products

Financial Corporation’s exposure of 900 million sensitive

Human health activities

customer files in 2019 and the well-known case of Facebook’s

Residential care and social work activities

data breach of more than 540 million users’ records and social

Electrical equipment

networks.

Wholesale and retail trade, repair Finance and insurance

Different sectors of the economy have been victims of data

Scientific research and development

breaches and hacks, including the health sector. According

IT and other information services

to the 2019 Annual Breach Barometer Report, more than 31 million patient records had already been breached in

Level of Adoption

Low

Medium-low

Medium-high

Source: OECD: Measuring the Digital Transformation 2019

High

the first half of 2019, with hacking causing the majority of security incidents and breaching the most patient records.

TITLE: GLOBAL INDUSTRY RANKING BASED

GLOBAL INDUSTRY RANKING BASED ON THE USE OF ON THE USE OF AI (2018) AI (2018)

health sector is the management of health information or healthcare analytics that could improve the industry and

Healthcare

care services. “Improving communication can help the health

Mining and minerals

industry understand more deeply not only the dynamics of communication between health professionals and patients,

Telecom

but also to provide complementary solutions that spread

Retail

throughout the industry,” says Antonio Carrasco, Director

Insurance

General of PLM Latina.

Banking Public Service

Information generated through IT can also be turned into

Manufacturing

valuable information that can be used by both the private and public sectors. “Information can be gathered and used to

CPG

understand epidemiological trends in a country, so a company

IT/Tech/EHT

can know if an epidemic is on the horizon,” says Carrasco. The

Oil and Gas

global healthcare analytics market was estimated at US$7.04

Chemicals

billion in 2016 and is expected to total US$53.65 billion by 2025, according to a study by Grand View Research.

Metals 0

15 Javier Guadarrama, Director General of Health and Benefits, a

Source: Accenture Healthcare Survey 2018

Grupo Promass company, says the impact from data analytics Mexico ranks third for most cyberattacks in the world, just

on health services has sweeping potential. “Information allows

behind the US and UK, according to a 2018 Lockton México

a company to understand the main uses for phone-assisted

report that states that the estimated loss as a consequence

medical care, what diseases are more frequent, what are the

of cyberattacks in the country totaled US$7.7 billion in 2017.

main reasons why people call, most common age group, peak hours and the locations where these services are demanded.”

International standards govern the confidentiality of data and information, as well as the systems that process it. ISO

GLOBAL HEALTH GLOBAL HEALTHDATA DATAINCIDENTS INCIDENTS AND AND BREACHES 27001 is a Standard for Information Security Management BREACHES BY 2018 BY 2018 (PER TYPE) Systems that allows organizations to assess risk and apply the

44.22% Hacking 28.09% Insider 14.34% Loss/Theft 13.26% Unknown

necessary controls to mitigate or eliminate them.

ANALYTICAL FUTURE The evolution of the health industry due to technology has gone through different processes, from Industry 1.0 to today’s iteration, Industry 4.0, which connects the IoT to manufacturing techniques, allowing systems to share information, analyze it and use it to guide intelligent

Source: 2019 Annual Breach Barometer Report

actions. Among the opportunities of 4.0 technology in the

TOP 5 GLOBAL RISKS IN TERMS OF LIKELIHOOD Rank/Year

2015

2016

2017

2018

2019

Interstate conflict with regional consequences

Extreme weather events

Large-scale involuntary migration

Natural disasters

Failure of climatechange mitigation and adaptation

Failure of national governance

Failure of climatechange mitigation and adaptation

Major natural disasters

Cyberattacks

Natural disasters

State collapse or crisis

Interstate conflict with regional consequences

Large-scale terrorist attacks

Data fraud or theft

High structural unemployment or underemployment

Massive incident of data fraud/theft

Failure of climatechange mitigation and adaptation

Cyberattacks

Source: World Economic Forum: Global Risk Report 2019

101

| VIEW FROM THE TOP

MEDICAL RECORDS ARE PATH TO SECTOR OPTIMIZATION XAVIER VALDEZ Regional Manager for Real World Analytics and Services of IQVIA

102

Q: How does IQVIA view R&D in Mexico?

The company has invested heavily in OCE and as part

A: At a corporate level, this is a fundamental area for the

of our Latin American hub, Mexico is fundamental in our

company because it helps us identify future releases and

approach to technology and analysis. We already have

to work more efficiently with clients depending on their

multinational clients using OCE in Mexico and we have

therapeutic focus. Locally, however, R&D has not evolved

more projects in the pipeline that we hope to consolidate

significantly. Our main focus has been to take advantage of

in the midterm.

global studies and research to prove a productâ&#x20AC;&#x2122;s efficacy. That being said, we do see a great opportunity for R&D to

As the healthcare sector evolves, we see a dire need

grow in Mexico. The country hosts institutions with global

for data integration between different industry players.

prestige that work to the highest standards. At the same

The government wants to make changes to how Seguro

time, we have a large patient population that is diverse

Popular operates but it may not have a clear idea of

enough to cover the different treatments we analyze.

what it means to have medical records at a national level without being dependent of a particular institution. Cloud

The main area of opportunity in the country is accelerating

implementations are essential for this to work and to

the time it takes for protocols to be approved, together

conduct efficient research related to the best treatments

with increased certifications for hospitals and training of

for each patient.

doctors. We estimate approximately US$6 billion is invested globally in clinical research annually yet Mexico receives

Q: How is your focus on data access impacting the

only US$200-300 million. If we could attract more of these

evolution of the OCE platform and the development of

resources, doctors would benefit from better training and

other platforms?

patients would have access to innovative treatments.

A: We are merging OCE with our doctor database. We have information related to doctorsâ&#x20AC;&#x2122; areas of expertise,

Q: How is IQVIA taking advantage of Industry 4.0

hospitals where they work and other variables that allow

advances and what long-term impact are you expecting

for segmentation based on contact preferences. This

in the healthcare sector?

helps us create directed campaigns based on a specific

A: We are still betting on technology and the development

treatment or an area where we want to promote a certain

of new solutions to improve our sales force. Our customer

solution. After we receive information back from doctors,

relationship management solution, called OCE, gives us

we can use that to strengthen our algorithms and further

greater control of our promotional strategy with clients

boost our campaigns depending on how doctors build their

and stakeholders through an omnichannel platform and

treatments or the information they wish to receive.

helps us achieve close data integration within the different areas of the company. Big Data is a key element in our

Data access is also a priority to generate databases that

solution. This provides results based on solid analysis of

help us draw conclusions about treatments and their

the information we offer to clients and that we receive

efficacy. At the beginning of 2018, we released a platform

as feedback from them. From this, we can then execute

called Oncology Dynamics where we gather data from

appropriate business strategies.

250 oncologists on patients, types of cancer, treatments and how patients are responding to them. Although our database is small, it is already yielding interesting results

IQVIA is a US multinational based in Durham, North Carolina.

related to treatment use and efficacy, as well as how

With a network of more than 50,000 employees, it delivers

doctors are treating complications related to a specific

human data science to the health information technologies

disease. We collected the first batch of data in March 2018

and clinical research industries

and we have been adding to that with quarterly reports.

INSIGHT |

PREVENTION THROUGH PUBLIC‑PRIVATE COLLABORATION ANTONIO CARRASCO Director General of PLM Latina

Despite the availability of technology in Mexico,

its product because its device was aimed at a very

organizational weakness is hampering the country’s

small group of patients with erectile dysfunction,” says

digitalization, particularly in healthcare, says Antonio

Carrasco. PLM’s experience working in the health sector

Carrasco, Director General of PLM Latina. “The main

in various therapeutic areas helped this company to

obstacle to technological transformation is not

better target medical specialists who could reach the

technology but how the private and public health

patients who would benefit from this product. “After a

sectors in Mexico are organized. Technologies exist in

patient undergoes a series of pharmaceutical processes

the country; what is needed is to improve infrastructure

to treat their erectile dysfunction, they become a

and interoperability,” he says.

candidate to use this medical device. PLM guided the company in better marketing its product and looked for

PLM Latina, a leading health sciences technology

strategies to approach men with severe cases of erectile

company, specializes in business intelligence and digital

dysfunction,” he says.

marketing solutions through IT. According to an article by the Regenstrief Institute and published by the American

Digital tools like Big Data can also strengthen the medical

Journal of Medical Sciences, the real value of information

care provided to patients. Carrasco believes this means

technology lies in extracting value from the chaos of

that “patients not only have access to technologies but

information, which is PLM’s goal. “PLM Latina’s added

also to knowledge that improves the whole process

value is its ability to transform information into valuable

of their care, integrally involving the entire health

knowledge for companies,” says Carrasco.

ecosystem.” The information generated through IT can then generate valuable information for companies.

At the macro level, the first step is to change the thrust of

“Information can be gathered and used to understand

the health sector and focus more on prevention, explains

epidemiological trends in a country, so a company can

Carrasco. “In general, we must focus on the prevention of

know if an epidemic is on the horizon, for example. This

chronic degenerative diseases through the collaboration

allows the Ministry of Health and the private sector to

of the public and private sectors.” At the micro level,

be ready.” He adds that real-time delivery of information

Carrasco says that it is necessary to pay more attention

is a difference-maker. “The added value of the Big Data

to the relationship between the doctor and the patient.

generated by PLM is that companies receive information in real time. This makes a considerable difference for our

For that reason, he believes that digital tools and

customers compared to other service providers. PLM

PLM solutions can help doctors better understand

does not need days to generate valuable knowledge.”

this relationship and spread the benefits throughout the health ecosystem. “We believe that improving

PLM is a strong advocate of the patient-centric model,

communication can help the health industry understand

which is a goal in all its solutions, as well as infusing

more deeply not only the dynamics of communication

its offerings with rigorous management of quality data.

between health professionals and patients, but also to

Carrasco explains that PLM’s Big Data philosophy is

provide complementary solutions that spread throughout

focused on the four V’s: velocity, variety, volume and

the industry.”

veracity. “This approach has helped PLM to handle large numbers of clinical decisions made by physicians

Carrasco highlights a PLM client to illustrate his point.

in relation to the pharmaceutical and medical devices

The medical devices company needed to promote

sectors and to understand the needs of health

a urological product to the market and to medical

professionals in Mexico, with the patient as the central

specialists. “This company faced difficulties in positioning

focus,” he says.

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| ROUNDTABLE

HOW IS YOUR COMPANY DISRUPTING HEALTHCARE PRACTICES?

Technology is increasingly penetrating every economic sector and healthcare is no exception. Its defenders are looking to integrated healthcare solutions that connect every aspect of care, from the moment the patient is admitted to remote at-home follow-ups. Technology is advancing rapidly, raising the issue of laws and public regulators’ capacity to maintain pace. With the introduction of Big Data, privacy issues are also in the spotlight. But there is little doubt that Healthcare 4.0 is here to stay, altering the delivery and tracking of treatments, measuring results and encouraging proactivity in a prevention-first paradigm.

104

We are still betting on technology and the development of new solutions to improve our sales force. Our customer relationship management solution, called OCE, gives us greater control of our promotional strategy with clients and stakeholders through an omnichannel platform and helps us achieve close data integration within the different areas of the company. Big Data is a key element in our solution. This provides results based on solid analysis of the information we offer to clients and that we receive as

XAVIER VALDEZ

feedback from them. From this, we can then execute appropriate business strategies.

Regional Manager for Real World Analytics and Services of IQVIA

Disruption in healthcare will be broad and will come in different ways. We hope to be among the first lines of attack regarding education. For example, the overuse of antibiotics is now a big problem. Through our platform, we can provide the right information and advice to a patient regarding next steps and whether antibiotics are truly necessary. Ignorance is a major problem and auto-medication is the cause of many deaths. It is important for patients to consult with someone who has the

CHARLES NADER Co-founder of Doc.com

expertise and authority to prescribe medication. Perhaps in the future, artificial intelligence will be able to make those decisions for the doctor but we are not there yet.

Health and Benefits’ telemedicine solution provides primary care to the population, which represents over 80 percent of the demand for health services. The remaining cases are referred to health institutions that can treat them appropriately. We have agreements with the main healthcare providers across the country, benefiting all our affiliated patients. When an operator detects the need to direct the patient to another level of care, we make the appointment with a specialist. In case of an emergency, we

JAVIER GUADARRAMA Director General of Health and Benefits, a Grupo Promass company

request an ambulance to transfer the patient to a hospital, follow up on the patient’s arrival at the hospital and then follow up again at the end of their care.

INSIGHT |

PATIENT ADHERENCE THROUGH PERSONALIZED SERVICES ALBERTO WICKER CEO of Signufarma

Low patient adherence to medication regimes raises healthcare

department that studies the main treatment abandonment

costs and reduces the efficacy of the healthcare system as a

causes to develop contingency plans, emotional support

whole, says Alberto Wicker, CEO of Signufarma. Yet, neither

lines and coaching. We also provide support to the patient’s

the public nor private sector is seriously addressing the issue.

family. No one is truly prepared to address a degenerative, chronic disease so our goal is to support them,” says Wicker.

While great efforts are being made to bring doctors, hospitals and medications closer to a larger number of people, all these

To measure adherence, Signufarma developed software

measures fail if patients do not take their medicine. “We

that monitors all steps of the patient’s journey and

believe in the efficacy of medications and that the significant

can predict points at which a patient might abandon

investment behind them will lead to a positive effect for the

treatment. “In these instances, we follow up with them

patient,” says Wicker. “But whatever benefits patient could

directly so this can be avoided. For instance, if a patient

get from their medications will be lost if patients skip them.”

misses a programed diagnostic test, an alarm flares up in our system and we contact them directly.” To achieve its

Low patient adherence is a significant problem. The journal

goals, Signufarma created numerous alliances with retailers,

US Pharmacy reports that about 50 percent of US patients

clinical laboratories, doctors and hospitals. The company

taking medication for chronic ailments fail to adhere to

also uses social media to monitor patients and track their

treatment. Moreover, the failure to adhere to treatment

experience. As Wicker says, by knowing a patient’s wishes,

accounts for up to 50 percent of all treatment failures and

Signufarma can personalize its solutions. “During the past

leads to 25 percent of hospitalizations in the US. Wicker

few years we have used information from social networks

believes that addressing low patient adherence is a simple

and our own platforms to ensure that our solutions are

strategy that will benefit patients, healthcare systems and

convenient, accessible and liked by patients. Every patient

medicine manufacturers.

is different so we are implementing mass customization to adapt our solutions to each patient,” he says.

Signufarma is a service provider for effective patient support programs that has worked in healthcare sector for

The results speak for themselves, Wicker says, pointing to

25 years. The company specializes in support programs

oncology as an example; the company’s software helped

that help patients adhere to their treatment and it also

patient adherence increase to 94-95 percent. “We have

develops software to distribute pharmaceuticals to patients

also built formulas that allow us to measure the patient’s

and programs to measure the quality of life of patients.

response to treatment and measure the treatments’ ROI.

Signufarma has worked with Roche, Amgen, Bristol Meyers

We also helped pharmaceutical companies to optimize their

Squibb, Novo Nordisk, Shire and AstraZeneca, among

resourcing by helping them identify the areas that need

others, on developing programs to monitor medication

more attention, for instance by educating patients.”

use for many conditions, including rheumatoid arthritis, oncological and rare diseases. Signufarma operates in

Signufarma began operations with treatments for

Mexico and several countries in Central America, Colombia,

hypertension and hypercholesterolemia but gradually

Ecuador and Peru, where it introduced programs that closely

expanded into areas in which it believes it could have a

monitor patient experience and allows the company to offer

greater impact, such as medical specializations. “Eighty

several benefits specific to the patient’s therapeutic needs.

percent of our operations addresses medical specializations and the rest are geared to general medicine. However,

“We monitor patient’s adherence to treatment in the

this is about to change as the pharmaceutical sector is

manner the patient prefers: phone, text messages, personal

increasingly aware that it has to strengthen its brands to

visits or social media. We have also developed a psychology

assure a return on investment.”

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| VIEW FROM THE TOP

PATIENT HISTORY AT A GLANCE FOR BETTER TREATMENT ELIE HAIBI Co-founder of Ominé

106

Q: What needs is Ominé seeking to address in the

Besides providing details on patient records, the Ominé

health sector?

platform also allows communication between doctors of

A: Compared to sectors such as banking and insurance, the

different specialties: the care team. Using a virtual space,

healthcare industry is still lagging in terms of digitalization;

they will be able to share their advice and perspective,

information is not yet properly valued. Many hospitals and

which means decisions will not be based solely on the

other healthcare institutions still function in the traditional

knowledge of a single person but complemented and

way, following a physical paper bureaucracy. These players

validated by their peers. The result will be a more unified

have the means to go digital but face a cultural obstacle.

and aligned care strategy that will lead to better results

People have difficulty understanding that healthcare can

and fewer errors.

be translated into electronic data because they perceive healthcare as only the immediate clinical examination and

Patients and their family are left with a considerable part of

the personal attention the patient receives. Yet, technology

the care process and they often have to make a wide range

can improve even these aspects of care.

of decisions, from nutrition to scheduling labs, without the proper guidance or training and without anyone to ask when

We want to take the industry beyond paperless operations.

they need an answer between two medical appointments.

In the public sector, for instance, doctors dedicate 15-20 minutes for every appointment but most consults end up

Q: What other benefits can Ominé provide to the

being five to 10 minutes. The reason is the large line of

healthcare sector?

patients waiting outside. Because doctors do not have

A: Even the most prestigious Mexican hospitals suffer due

access to the patient’s full medical records, they also need

to a lack of coordination, which translates to operational

to spend time asking questions before they can address the

errors, prescription errors and mistakes in dosage and

symptoms. This forces them to make important decisions

administration of medications. Medical services without

based on incomplete information. Access to an electronic

good coordination and information are simply a disaster.

database would allow doctors to check the patient’s history

In the US alone, between 200 and 400 people die every

at a glance and make the right decisions. As a result, patients

day due to poor quality care, as well as negligence. Digital

would receive better treatments and doctors would have

platforms provide all the necessary information throughout

some of the burden lifted off their shoulders. In general, the

the care process to ensure appropriate decisions are made.

care process lacks information that is timely, up-to-date and relevant to each activity, impacting both care professionals

Although the biggest problem is one of management and

and patients. We want to address that issue.

operational quality, in many cases, bad decisions are made simply because health professionals do not have access to

Q: How can Ominé improve the experience of both patients

the patient’s complete record. A complete analysis of the

and medical professionals?

patient’s history can elucidate problems that would not be

A: Digital transformation is not our goal but the means

visible through a simple examination of symptoms. A good

to an end. The goal is ensuring a better experience for all

example of this would be chronic diseases like diabetes. A

parties through greater efficiency and higher care quality.

one-time test of glucose levels is never going to provide the full picture. This patient’s health is not a photo; it is like a video that shows an evolution in glucose levels in

Ominé is a patient-centric healthcare information platform

relation to physical activity and nutrition. It is hard to give

that seeks to impact the quality of care and deliver value to

accurate advice based on incomplete information and not

patients, doctors, hospitals and healthcare personnel through

every doctor is an expert in diabetes. In most cases, patients

digital transformation

with diabetes are treated by general practitioners.

VIEW FROM THE TOP |

INTEGRATED SYSTEM PROMISES SAVINGS FOR PATIENTS, PAYERS MORGAN GUERRA CEO of Previta

Q: How does Previta use technology to improve health

A: The first step is to convince the payer about the solution

practices?

and the return on investment they will receive. Then,

A: Previta developed e-HealthTracker, a population health

we must convince patients and their families that the

platform that provides a wide range of services designed

technology can help them. Being diagnosed with a chronic

to monitor and support patients in all stages of a disease.

disease is often a shock to patients.

It can be adapted to follow many conditions, including diabetes, cardiac and immune diseases as well as the side

The third step is to get doctors to buy and see this

effects related to other issues like tobacco consumption,

monitoring services as an ally. The appropriate treatment

hypertension and diabetes.

of these patients requires collaboration among different specialists, laboratories, hospitals and the payer, whether

We can measure a person’s risk factors to help prevent

a public or private institution. While some may believe

obesity, diabetes and hypertension. If this person already

that these systems can only be used in major cities,

suffers a disease, through remote patient monitoring we

that is not true, thanks to the widespread availability of

avoid complications.

smartphones and 3G that allows technology to be used even in rural areas.

Q: How does Previta’s technology benefit patients? A: Our most complete service is Victoria, a home-

Q: How do the Mexican healthcare sector and private

monitoring kit for people with heart failure. This disease is

entities benefit from this system?

much more expensive for healthcare systems than cancer

A: The incorporation of remote patient monitoring into

since patients often survive for a longer period, although

the healthcare system following international standards

with a low quality of life and with numerous hospitalizations.

leads to stronger prevention strategies that would benefit

Victoria provides health devices to measure and monitor

the patient’s health and provide long-term savings for the

patients, turning their homes into a “virtual hospital.”

payer. Our products allow patients to improve their quality of life, which reduces unnecessary hospital expenses. For

Our contact center receives and evaluates this information

instance, about every six months, patients with heart failure

daily and if a deviation from normal ranges is detected, the

usually suffer a decompensation that normally would lead

health coach at the contact center notifies the patient’s

to a week of hospitalization.

cardiologist. Victoria has been highly effective in saving these patients from the need for hospitalization.

These hospitalizations are very expensive for the insurer. By monitoring the patient’s vital signs, we can detect

Victoria consists of a scale, a barometer and a heart monitor

decompensation early in the incident and channel

fully integrated into a tablet. Health data is automatically

the patient to their cardiologist before they require

recorded and stored in the cloud so it can be shared

hospitalization. With proper care and an adjustment of the

with the patient’s doctor. Moreover, if the patient skips

medication, it is possible to prevent hospitalization, which

a measurement for any reason the equipment sends a

results in significant savings for the payer and better care

reminder to their phone or to a relative or physician. While

for the patient.

the different equipment that composes Victoria is sourced from around the world, the system that brings it together was developed in Mexico by Previta.

Previta is a Mexican developer of software systems related to the remote monitoring of patients and consulting-room management.

Q: What are the main challenges when convincing payers

It also focuses on prevention of diabetes and related diseases

to use this system?

through a wellness platform and medical checkups

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| VIEW FROM THE TOP

TELEMEDICINE THE FUTURE TO BETTER, GREATER HEALTH ACCESS JAVIER GUADARRAMA Director General of Health and Benefits, a Grupo Promass Company

108

Q: How does Health and Benefits (H&B) use information

we offer, such as psychological, nutritional, medical and

and communication technologies to bring healthcare

dental solutions. For example, previously H&B used a third-

services closer to the population?

party application to provide teleconference consultations

A: H&B pioneered the use of information technology and

but the company developed its own digital tool for that.

communications (TIC) to provide healthcare services to the

Our services are offered all across the country and in

Mexican population. We have been offering our services

the near future, we expect to expand our services to

for over 15 years and our affiliates account for more than

Central America.

20 million people across the country. H&B uses telephonic assistance services and in the past year we are happy to

Q: What are the main needs your technology solves

share that we have not had a single incident and our quality

for clients?

surveys demonstrate satisfaction among our affiliates. Our

A: Mainly we provide primary medical care to our members,

latest survey, conducted by the Social Security Institute and

but also nutritional and psychological support. The

involving 2 million people, confirmed a 94 percent rate of

psychological care service is a very successful niche and it is

satisfaction and positions Health and Benefits as a strong

growing rapidly because patients feel more secure in having

telemedicine services company.

a conversation when it is not face to face. Phone assistance provides patients with a greater facility to express how they

When we launched telephonic medical assistance, the

feel and what they think. This allows people who live with

company discovered that the majority of patients wrongly

a mental illness to feel more involved in their health and

believed doctors had the appropriate training to provide

to have access to comprehensive care. Another example

nutritional and psychological advice. H&B saw this as an

of the benefits of our technology is a device that takes

opportunity and opened a new area to offer specialized

blood pressure and glucose levels in real time and sends

nutritional and psychological services. Nutrition is an

the data to the cloud via Bluetooth to be recorded in the

integral element of an individualâ&#x20AC;&#x2122;s overall health. H&B

patientâ&#x20AC;&#x2122;s clinical record. This tool promotes greater control

uses the same technological mechanisms and customized

for the patient but also gives the doctor the facility to follow

service to provide nutritional and psychological assistance,

up. All our solutions are based on international health

reinforced with a digital platform named TeleSalud where

recommendations, which gives our digital platform the

patients can register their weight, size and height to receive

added value of portability. This means patients own their

information about body mass and suggest a goal they

electronic file and have the power to decide with whom

must reach.

and how to care for their health.

Q: How does H&B provide its customers with an added

Q: With a clinical information base of 20 million people,

value beyond digitalization?

what opportunities does H&B see in Big Data?

A: Our core added value is in promoting change. H&B

A: H&B is certified in ISO 270001 to protect all information. It

motivates its patients to take co-responsibility in the

also adheres to ethical and privacy standards. The company

management of their health. We have extended our digital

knows medical information can be sensitive and it is careful

platform, called TeleSalud, to encompass all the services

when using it. We have over 15 years of experience that has provided the company with a great deal of information but also with the necessary expertise to manage it. We

Health and Benefits specializes in providing solutions and

are integrating this information to identify business

management services for the health sector through a network

opportunities and develop the appropriate technologies

of doctors, hospitals, laboratories, pharmacies, optical clinic

that can continue bringing access to healthcare closer to

and specialized clinics

the population.

VIEW FROM THE TOP |

DISRUPTING HEALTHCARE TO EMPOWER PATIENTS GUILLAUME CORPART Managing Director of Global Health Intelligence

Q: What trends are transforming the healthcare industry

hospitals are much larger, with an average of 120 beds,

in Mexico?

while private hospitals are much smaller with only around

A: This is a year of changes and the industry has to prepare

17 beds per hospital. Having so many small hospitals affects

for them. All our clients are wary of the changes in the sector.

the countryâ&#x20AC;&#x2122;s overall potential for investment in healthcare

Companies working mainly with the public healthcare sector

and technology.

have been hit by recent tenders, which opened the doors to countries with which Mexico has no FTAs. These countries

We are seeing a growing number of smaller hospitals

manage lower prices, which forces local manufacturers to

that focus on a select number of medical procedures and

lower their own prices, reducing their margins. The public

often focus on ambulatory surgery. These were created to

healthcare sector has also halved its budget. This is a blow

address the needs of the middle class, as many individuals

to local manufacturers of pharmaceutical and medical

are willing to pay to gain access to private healthcare but

supplies, which are now looking for ways to optimize their

they cannot afford larger hospitals such as Hospital Ă ngeles

production to reduce manufacturing costs.

or Hospital ABC.

Companies that sell mainly to the private sector will not be

Q: What benefits does the trend toward ambulatory

as affected. For that reason, many manufacturers will try

services bring to patients and the healthcare system?

to increase their focus on the private sector, specifically in

A: About 60 percent of healthcare services are provided

small and medium-sized hospitals.

by the public sector so budget cuts will have a deep impact. Moreover, demand continues to grow alongside

Q: How is Global Health Intelligence helping companies

the population. These trends will impact the sector

adapt to the changes in the market?

on two fronts: quality and wait times. Mexicans have a

A: Many companies will have to change how they measure

significant problem accessing quality healthcare services

themselves against competitors to increase their market

at the moment they need it. For instance, people with a

participation. This will be increasingly important now that

cardiovascular disease cannot wait six months to address

public tenders have been opened to other countries. To

their problem.

support our clients, we are developing a series of products tailored to different companies based on their size and

Under these circumstances, ambulatory surgery plays an

market participation. During 2019, we have refined our

important role as it streamlines surgical services, allowing

ShareScope tool, which allows companies to measure and

hospitals to treat more patients and to provide quality

track their position in the market.

services. Leaving a patient to recover in the hospital is a bad use of resources because the bed, doctors and nurses

Q: What market insights has the company identified

cannot focus on another patient. Letting patients recover

through its platform HospiScope?

at home and helping them leave the hospital as soon as

A: The number of beds is an important indicator of the

possible allows for a more efficient use of resources. Without

size of a hospital in terms of patients and of its capabilities

ambulatory surgery, the healthcare system would be unable

to invest in technology. A hospital with less than 20 beds

to provide care to the growing population.

does not have the ability nor the financial capability to acquire sophisticated diagnostics equipment, which usually amounts to over US$500,000. Developed economies like

Global Health Intelligence conducts market research to provide

the US and Europe have an average hospital size of 160

strategic data on health infrastructure in emerging Latin

beds. In Latin America, the average is 45 beds and Mexican

American and Asian markets. The company offers four main

hospitals have an average of 50 beds. Public Mexican

services: HospiScope, ShareScope, In-Scope and SurgiScope

109

| INSIGHT

ADAPTING TECHNOLOGY TO THE NEEDS, LIMITATIONS OF EVERY CLIENT JORGE CAMARGO Co-CEO and Co-founder of Ecaresoft

110

Developing solutions to increase productivity and efficiency

must be on maintaining the level of care and the safety of

in healthcare goes beyond just introducing new technology.

operations. “Automating administrative processes allows

Systems must adapt to clients of all sizes and sometimes

the hospital to lower costly hours and invest in other areas,

even keep some of the old ways of doing things, says

both in terms of attention to patients and distribution of

Jorge Camargo, Co-CEO and Co-founder of Ecaresoft.

financial resources.”

“To democratize technological solutions is to make them accessible to all clients,” he says.

Most patients go to the doctor, then undergo several laboratory tests that are sent by email to the patient who

According to Camargo, health clinics with under 20 beds,

has to send them by email to the doctor. “This is not a

which comprise a large portion of health providers in the

particularly efficient model,” says Camargo. With a digital

country, have not been able to adopt solutions to improve

platform, results could be registered in the patient’s file

their businesses and will struggle to do so in the next few

immediately by either the patient or the laboratory. “The

years. Reasons for this are the average costs of investing in

same platform can be used to plan consultations, update

advanced technological systems, as well as their complexity.

a patient’s medical history and receive prescriptions from

“There is a lack of incentives for this transformation in

the doctor, all processes that normally take time from the

Mexico,” he says.

patient and the hospital staff.” Administrative changes do

“

To democratize technological solutions is to make them accessible to all clients”

not have to involve “super-intelligent algorithms,” says Camargo. Sometimes, paper is the easiest solution. “In the short term, paper may not be too bad for certain tasks. However, the problem is when certain activities accumulate.” Ecaresoft wants to eliminate those peaks without creating a barrier between the doctor and patient. “Doctors must not end up looking more at a screen than caring for the patient,” he says.

The solution is to find more flexible technology models that

Camargo mentions WhatsApp as a simple example to

can adapt to clients’ needs and conditions, which can also

maintain contact between patients and doctors. Digital

be rapidly implemented and require minimal training. Big

communication channels even allow doctors to treat patients

hospitals have a larger budget and often feel a greater need

when they are available. “The patient can send a picture or a

to organize their operations more efficiently because of

video and the doctor can then respond 20 minutes later with

their complexity. Small clinics have less staff but are already

instructions. This can eliminate the need for clinical visits,” he

dealing with technical limitations, says Camargo. “The kind

says. There is also great potential for insurance companies

of improvements that digital platforms can introduce, such

to offer their plans digitally. “Currently, inefficiency in the

as automating administration and improving communication

provision of insurance policies is a key factor behind rising

between the patient and doctor, can greatly improve health

prices and thus a barrier for insurance penetration in Mexico,”

services at these small institutions.”

says Camargo. Ultimately, technology is flexible and it can be adopted as a whole or in parts, depending on the needs

Productivity in the health sector is hard to define, however.

of the company. Tools can be combined and adapted to

In other industries, such as agriculture and manufacturing,

each company’s budget and requirements, increasing access

results can be easily measured in numbers. “In healthcare,

and reducing the financial burden. Regardless, “the benefits

it is not as simple as saying we are increasing the number

of technology outweigh the initial investment required to

of surgeries from 10 to 15,” says Camargo. The focus, then,

implement it,” says Camargo.

VIEW FROM THE TOP |

DIGITALIZATION: ROAD TO HEALTH ACCESS CHARLES NADER Co-Founder of Doc.com

Q: How is your company disrupting healthcare practices

Efficiency is also lacking in the health sector. Hospitals are

and what will this mean for the long-term future of

overburdened and, in many cases, receive people who should

healthcare?

not be there. This affects people who do need hospital

A: Disruption in healthcare will be broad and will come in

care. With our app, many people can receive healthcare

different ways. We hope to be among the first lines of attack

without having to go to a hospital or even without having an

regarding education. For example, the overuse of antibiotics

insurance policy. We are not claiming that we are going to

is now a big problem. Through our platform, we can provide

solve every health problem, but our system can help patients

the right information and advice to a patient regarding next

make better choices. The data we gain from our customers

steps and whether antibiotics are truly necessary. Ignorance

allow us to better analyze what is happening in the sector.

is a major problem and auto-medication is the cause of many deaths. It is important for patients to consult with someone who has the expertise and authority to prescribe

Doc.com is a Mexican online platform that allows patients to

medication. Perhaps in the future, artificial intelligence will

consult doctors and receive advice, referrals and prescriptions.

be able to make those decisions for the doctor but we are

The platform is available in 24 countries in the Americas and is

not there yet.

expanding to Europe, Africa and Asia

VIEW FROM THE TOP |

TECHNOLOGY AS A CATALYST FOR OPTIMAL PERFORMANCE CARLOS ESCALANTE CEO and Founder of Pen Healthcare (Punto Pen)

Q: Who are Pen Healthcare’s clients in the health sector?

Q: Pen Healthcare offers a wide array of technological

A: In the private sector we work with pharmaceutical

solutions and services. How does the company and its

companies developing patient support programs (PSP)

products make a difference in Mexican healthcare?

and with insurance companies in offering disease

A: We go beyond offering health information systems and

management programs and case management. For

services to clients; we offer solutions that are helping to

the public sector, we provide electronic health records

transform the future of Mexican healthcare. The long-term

(EHR), epidemiology platforms, health assistance

goal is to create integrated healthcare networks. We work

by telemedicine services and communication and

hand-in-hand with other companies and government entities

engagement strategies. Our most powerful tool is

to build data interoperability between all healthcare parties.

the PHENM (Personal Health Engagement Network Management). It is a platform we use with diabetes and hypertension patients through which we have achieved

Pen Healthcare has provided digital marketing solutions to

above 60 percent of patient control, thus significantly

pharmaceutical companies and public and private service

reduced complications. We achieve this through patient

institutions for 20 years. It has four services: Health Systems,

empowerment and treatment adherence.

Health Engagement, Health Assistance and Health Innovation

111

DrĂ¤ger transfer monitor for IC unit

MEDICAL DEVICES

Mexico is the No. 1 exporter of medical devices in Latin America with more than 40 production plants and participation in 75 medical specialties. However, many Mexicans still do not have access to these products. The rapid technological development in the medical devices sector creates possibilities for collecting and analyzing enormous amounts of information to create tailored alternatives for healthcare suppliers and payers. While beneficial, this also increases vulnerability to cyberattacks. Nonetheless, it is expected that the impact of technologies, such as autonomous surgical robots, 3D printers, assisted surgeries with augmented reality, artificial intelligence, biostamps and ultrasound therapies, will revolutionize the future of prevention, diagnostics, treatment and patient care.

Medical Devices shares the perspective of key industry players regarding the trends, challenges and opportunities that will revolutionize the medical devices industry and how different players will participate in this new scene.

113

CHAPTER 6: MEDICAL DEVICES

116

ANALYSIS: Technology Key to Better, Greater Access to Healthcare

118

INFOGRAPHIC: Medical Devices Production and Exports on the Rise

120

VIEW FROM THE TOP: Alejandro Paolini, Siemens Healthineers Mesoamerica 115

121

VIEW FROM THE TOP: Pablo Bufano, Dräger México

122

VIEW FROM THE TOP: Miguel Nieto, Carestream

123

VIEW FROM THE TOP: Enrique Giraud, Fujifilm México

124

Javier Giraud, Fujifilm México

VIEW FROM THE TOP: Juan Pablo Solis, Becton Dickinson Mexico,

Central America and the Caribbean

125

VIEW FROM THE TOP: César Carrasco, Philips Mexico

126

VIEW FROM THE TOP: Jesús Huerta, DiaSorin

127

VIEW FROM THE TOP: Marcio Mazon, Getinge Latin America

128

VIEW FROM THE TOP: Alejandro Von Mohr, Atramat

129

VIEW FROM THE TOP: Carlos Jiménez, B. Braun Mexico

130

TECHNOLOGY SPOTLIGHT: Atramat: 50 Years of Suturing Quality

132

VIEW FROM THE TOP: Roger Brownrigg, Johnson & Johnson Medical Devices México

133

VIEW FROM THE TOP: Juan Dovarganes, Arroba Ingeniería

134

VIEW FROM THE TOP: Rodrigo Díaz de Vivar, Roche Diabetes Care México

135

VIEW FROM THE TOP: Miguel Soto, Mindray Medical México

136

VIEW FROM THE TOP: Germán García, Smith & Nephew

137

VIEW FROM THE TOP: Mauricio Valero, Linet Group in Mexico

138

INSIGHT: José Ramón Velasco, Essity Medical Solutions Mexico

139

VIEW FROM THE TOP: Luis Garduño, Art-Técnica

| ANALYSIS

TECHNOLOGY KEY TO BETTER, GREATER ACCESS TO HEALTHCARE Technology is a disruptor that more often than not introduces positive change. But new technologies often also translate to higher initial costs, making it necessary for hospitals and developers to work together to develop solutions that will result in long-term savings Mexico has built a strong medical devices industry that

range of products ranging from sutures to implants and

meets the needs of its population and exports products

diagnostic equipment, both for treatment and diagnosis.

to major markets worldwide. The country is the eighth-

116

largest exporter of medical devices in the world and No. 1

A number of factors play into the country’s favor when it

in Latin America, according to the Mexican Association of

comes to the manufacturing industry, including a young

Innovative Industries of Medical Devices (AMID). In 2017,

and well-educated workforce, a strong manufacturing

the country’s medical devices production was valued at

arm and close proximity to the largest market for

US$13.81 billion and exports at US$9.39 billion, according

healthcare products. The US is Mexico’s largest buyer

to ProMéxico.

of exports in the medical devices sector, which speaks to the untapped opportunities in the region. “Mexico is

“Mexico is already an important player in the medical

exporting more than 90 percent of its products to the US,

equipment industry,” says Pablo Bufano, Managing Director

which obviously means the country is not looking at the

of Dräger México. Despite the lofty standing, the medical

rest of the Americas. That is an aspect to correct if Mexico

devices manufacturing sector represents only 0.21 percent

wants to be relevant in Latin America,” says Bufano.

of the country’s GDP, according to AMID, a figure that illustrates the industry’s significant potential. The medical

While the medical devices industry only represents a

devices sector was valued at US$403 billion in 2017,

small part of Mexico’s GDP, its importance goes beyond

according to EvaluateMedTech, and it is expected to be

economics. Medical devices can play a key role in the

worth US$522 billion by 2022. The country’s main exports

entire healthcare system, explains AMID, due to their role

are odontological, surgical and medical instruments.

in the diagnosis, treatment, prevention and monitoring of a disease. As the number of chronic diseases related

The International Medical Device Regulation Forum

to aging and obesity shows no sign of abating, the

(IMDRF) defines a medical device as any “instrument,

healthcare system will face an ever-growing burden to

apparatus, implement, machine, appliance, implant, reagent

provide healthcare for these growing number of patients.

for in vitro use, software, material or other similar or related

As a result, an integral approach to healthcare through

article” that can be used for the treatment, diagnosis,

every stage of the disease will be necessary to approach

prevention, monitoring of injuries or diseases. It also refers

this problem. Medical devices can play a key role at many

to tools that replace anatomy or a physiological process,

stages of the problem.

controls conception or provides information related to the human body. These characteristics point to a broad

GLOBAL SALES OF MEDICAL DEVICES (US$ BILLION) GLOBAL SALES OF MEDICAL DEVICES (US$ billion) 600

TRENDS Due to its value, the healthcare industry has become increasingly attractive for major technology developers such as Google Ventures, Microsoft, Apple and Amazon. The availability of data that can be used for detection, prevention or treatment is another factor. Deloitte

550

states that a third of the world’s data is generated in the healthcare industry and technology companies can use

500

this data for a broad range of applications. For instance,

450

Google’s DeepMind Health uses AI for the development of solutions that offer better and faster detection of

400

diseases and their treatment. In July 2019, the company 350 300

announced a technology that uses AI to predict acute kidney injury up to 48 hours before it happens, giving 2015 2016

2017 2018* 2019* 2020* 2021* 2022*

Source: EvaluateMedTech. *Projected

doctors a significant head-start to address this lifethreatening disease.

POTENTIAL SAVINGS THROUGH

POTENTIAL SAVINGS THROUGH THE IMPLEMENTATION THE IMPLEMENTATION OF AI OF AI (US$ billion)

a limit to the reach of such solutions. “We cannot build a

Service operations

hospital in every town in the country. There is not enough

Marketing and sales

money to build so many projects or to properly equip them. Similarly, there are not enough doctors and nurses

Risk

to work in every municipality,” says Roger Brownrigg,

Supply chain

Vice President Regional of Johnson & Johnson Medical Devices México.

Other Finance

Under these circumstances, technology can be of great help. “Technology can allow greater access to specialists

HR Source: McKinsey

kind have greatly contributed to increased access, there is

100

120

to more individuals, which will be increasingly useful given the rise in chronic-degenerative diseases,” says Marcos Pascual, Commercial Director of ANAFARMEX. During

The use of AI in healthcare appears to be taking off with

past years, telemedicine, meaning health at a distance

a growing number of companies perceiving its potential.

through information and communication technologies,

The AI for healthcare market is expected to be valued at

has been gaining strength in the country thanks to efforts

US$6.6 billion by 2021, according to BGV. This technology

from both the public and private sectors. To oversee the

has gradually made its way to Mexico. For instance, late

use of telemedicine in the country, the Ministry of Health

in 2018, Fujifilm Medical System allied with South Korea’s

created the National Center of Technological Excellence

Lunic and Mexico’s Salud Digna to implement a pilot

in Health, which now employs 4,300 specialists in many

project that will place five of Fujifilm’s picture archiving

areas to provide care for over 3 million people who may

and communications systems, known as PACS, equipped

live too far away from a hospital.

with the company’s AI technology in Salud Digna’s clinics. The equipment will be used by about 20 radiologists

SMALLER BUDGETS

who will provide feedback to evaluate the equipment’s

While technological solutions are gradually penetrating

worklist prioritization features in a real-life setting.

the Mexican market, there are challenges to overcome, including the country’s low investment in healthcare. “In

The project’s ultimate goal is to optimize the productivity

general, in Mexico, we spend very little on health services

of radiologists. “Our goal is to have a positive impact on

and a lot on the administrative side of healthcare,” says

the work of radiologists in three ways: helping them to

Carlos Jiménez, Director General of B. Braun Mexico.

prioritize patients, streamlining information through Big

Moreover, the budget cuts implemented by the federal

Data applications and developing more precise imaging

administration’s austerity goals have hurt healthcare

solutions that require only one take to avoid radiation

spending at many public healthcare institutions across

overexposure,” says Javier Giraud, Medical Systems Vice

the country, leading to a shortage of medications, doctors

President at Fujifilm México.

and medical supplies.

Besides improving many areas of healthcare, technology

To address these smaller budgets, many companies

can help to address some of Mexico’s most pressing

are changing their approach to the healthcare sector.

problems and support strategies to increase access.

“Today, our focus has evolved from products and services

“Mexico has a limited doctor base, which makes it an

to solutions. Instead of just focusing on technology, this

ideal candidate to use AI to grow and improve clinical

new approach has broadened our vision by putting

diagnostics at health institutions,” says Giraud. Mexico has

patients front and center and integrating our products

only 2.4 doctors per 1,000 habitants, less than the OECD

and services to offer a holistic solution,” says Brownrigg.

average of 3.4. Moreover, most doctors in the country are clustered around the major metropolitan areas of Mexico

The adoption of integral solutions for many areas of

City, Guadalajara and Monterrey, forcing patients in rural

healthcare can be a useful strategy to address Mexico’s

areas to travel long distances to visit a specialist.

growing healthcare problems brought about by the rising rate of chronic diseases. Within these strategies,

Many efforts have been made from public and private

medical devices can play a pivotal role thanks to their

organizations to increase access in rural areas. For

versatile use across healthcare. “The idea is to create

example, Grupo México’s Dr. Vagón uses a train to bring

a more integral environment that considers prevention,

specialists and diagnostics and treatment equipment to

diagnosis, treatment, rehabilitation and reincorporation

rural communities in 24 states. While initiatives of this

to normal life,” says Brownrigg.

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| INFOGRAPHIC

MEDICAL DEVICES PRODUCTION AND EXPORTS ON THE RISE

118

Mexico has climbed the ranks to become a manufacturing hub

Mexico had almost 2,500 medical devices manufacturers in

for medical devices. The country is now the eighth-largest

2017, producing US$13.81 billion worth of products. The sector

exporter of medical devices and the No. 1 exporter of medical

is expected to maintain the 7.9 percent annual growth rate it

devices in Latin America and the largest supplier to the US.

has enjoyed for the past 10 years.

Mexico is the eighthlargest exporter of medical devices in the world and No. 1 in Latin America

MEXICO'S EXPORTS (US$ billion) AND FOREIGN INVESTMENT IN MEDICAL DEVICES (US$ million) 10

400 350

300 250

200 4

150 100

2 0

50 2013

Exports

2014

2015

2016

2017

Foreign investment

Mexico registered 2,494 medical devices businesses in 2017, most of them located in Mexico City, State of Mexico, Baja California, Morelos, Jalisco, Sonora, Chihuahua, Coahuila, Nuevo Leon and Tamaulipas.

Mexico is the No. 1 supplier of medical devices to the US

Production of medical devices represented

US$13.81 billion

and exports amounted to

US$9.39 billion in 2017

MEDTECH, ARTIFICIAL INTELLIGENCE AND INTERNET OF MEDICAL THINGS (IoMT)

ADVANTAGES AND DISADVANTAGES OF IoMT Advantages

Disadvantages

Accessibility

Security vulnerabilities

Low costs per patient

High initial cost

Higher efficiency

Lack of standardization across systems

The Internet of Medical Things, referring to the interconnectivity of medical devices to collect and analyze data, was valued at US$41 billion in 2017 by MarketsandMarkets and is expected to rise to US$158 billion by 2022.

VALUE OF IoMT MARKET IN 2017 AND 2022 (US$ billion)

60 PATIENT'S POTENTIAL ACCEPTANCE OF AN AI ASSISTANT

Medical Devices Systems and Software

Cancer treatment advisor Doctor replacement

Technology

Blood sample tester

Services

2017

119

Customized fitness support

2022

Heart rate monitor

Mexico exports medical devices mainly to the US, Italy, Germany and France

Health coach Diabetes monitor 80

MAIN MEDICAL SUPPLY DISTRIBUTORS FOR PUBLIC INSTITUTIONS BETWEEN 2012-2018 (MX$ million) Supplier

Amount

Percentage

Dentilab

3,094.2

9.6

Distribuidora Internacional de Medicamentos y Equipo Medico

1,984.3

6.1

Galia Textil

1,689.7

5.2

Selecciones Médicas del Centro

1,056.5

3.3

Diagnoquim

916.6

2.8

Degasa

904.2

2.8

Grupo Fármacos Especializados

733.2

2.3

Especialistas en Esterilización y Envase

697

2.2

Juama

683.4

2.1

Becton Dickinson

653.6

Others

19,852.7

61.6

MANUFACTURING COSTS OF MEDICAL DEVICES COMPARED TO THE US (percentage)

-15

Canada

Netherlands

Italy

Australia

-10

-20 Mexico

Source: ProMéxico, Global Trade Atlas, HIS, FDI Markets, INEGI, SE, KPMG, PwC

France

Germany

Japan

-5

-25

| VIEW FROM THE TOP

DEMOGRAPHIC CHANGES IMPACT TECH DEVELOPMENT ALEJANDRO PAOLINI General Manager of Siemens Healthineers Mesoamerica

120

Q: How is Siemens Healthineers shaping the future of the

private investment in healthcare, otherwise, the gap will not

medical imaging and diagnostics segments in Mexico?

be filled. The increasing aging and growing population, as

A: We are convinced that innovation and technology are

well as the prevalence of chronic-degenerative diseases

the keys to optimizing global healthcare systems and fully

are making healthcare a priority worldwide. Mexico should

improving care for all people. For more than a century,

not be an exception. Besides innovation, we need to create

Siemens Healthineers has pushed the boundaries of medical

new partnerships and business models that offer clinical,

technology with a broad solutions portfolio. Our digital

operational and financial advantages for our customers.

technologies enable healthcare providers to increase the value of their journey while expanding precision medicine,

Q: How will Siemens Healthineers’ ACUSON Sequoia

thus transforming care delivery and improving patient

change diagnostic practices in Mexico?

experience. We are working closely with different players

A: Mexico has the second-highest OECD obesity incidence

from the healthcare sector to find new opportunities and

among adults at 33 percent of the total population. However,

introduce new business models that can improve the quality

this problem does not only affect Mexico but more than

of healthcare in Mexico.

600 million people around the world. Imaging patients with different sizes and characteristics is normally a challenge.

We are also introducing new technologies to the country:

Siemens Healthineers designed the new ACUSON Sequoia to

our ACUSON Sequoia ultrasound and our Biomatrix MRI.

adapt to the bioacoustics variations of each patient, including

ACUSON Sequoia is a remarkably fast, fully focused B-mode

tissue density, stiffness and absorption. This platform has

imaging system with no degradation of near-field or far-field

unique features that allow up to 40cm of penetration with

resolution. Biomatrix, on the other hand, is an innovative

high-resolution images, reducing the need to repeat scans,

and exclusive technology that automatically adapts to

unclear diagnoses and contributing to more confident results.

the patient’s anatomical and physiological characteristics. Biomatrix’s sensors capture respiratory and head motions,

Q: How is digitalization changing healthcare practices and

boosting consistency in the images and helping the user to

how can it be implemented in Mexico’s fractured system?

select the optimal exam strategy. This combination ensures

A: Digitalization in the healthcare sector is already a reality.

high-quality results.

AI, Big Data and healthcare analytics have improved operations and management of laboratories and hospitals

Q: What are the challenges and opportunities in the market

and have benefited the patient, allowing faster and more

given the goals of the federal administration to increase

accurate diagnostics with more personalized and less

healthcare services?

invasive treatments.

A: It is very important to focus on improving healthcare in the country. Mexico invests around 6 percent of its GPD

In Mexico, we can use digitalization to improve the patient

in healthcare, while developed countries invest 9 percent

experience, prioritizing complex cases that require more

or more. There is much to be improved — infrastructure,

attention and avoiding unnecessary interventions. For

hospitals, equipment and systems — so Mexicans can access

example, data analytics can be implemented to prevent

quality healthcare. There is also a great need to increase

diseases and to determine the patient pathway. It is possible to use digitalization to increase efficiency, productivity and improve healthcare processes. Information is the

Siemens Healthineers has over 170 years of experience and

main engine for AI and in Mexico we have a lot of it.

18,000 patents registered worldwide. Its portfolio includes

Unfortunately, much of it is fragmented. It is vital to

medical imaging, laboratory diagnosis and advanced therapies,

integrate and standardize this data if we want to develop

technological and digital solutions

a national AI policy.

VIEW FROM THE TOP |

EFFECTIVE COMMUNICATION IMPROVES EFFICIENCY IN OPERATING ROOMS PABLO BUFANO Managing Director of Dräger México

Q: What are the main challenges of competing in the

financial solutions that will help them to access our

market for operating rooms?

solutions. In addition, we are working on offering diplomas

A: The main priority is the patient’s safety and well-being.

or certifications to medical professionals who receive our

This means always having sanitized equipment and allowing

training. The idea is to strengthen hospital teams. Lastly,

the doctor to access as much information about the patient

we are working on integrating all our services into one

as possible. Ensuring all this information is synchronized and

system. We want to improve communication between

updated in real time is very important. We put significant

different medical teams and equipment through a central

emphasis on creating a protocol and a coded language

station that can bring together all data. We have been

to feed our system with information that the doctor and

working with 50 companies from all over the world

operating room staff can control. This increases efficiency

to develop a common language that allows different

during the procedures, given that no unnecessary actions

equipment brands to communicate effortlessly. The

are taken due to misunderstandings.

protocol has already been approved and Dräger intends to launch its first product in 2019.

Q: What differentiates Dräger México from its local and international competitors?

Q: What do you think Mexico needs to become a hub of

A: Since 1889, we have specialized in acute care and now

medical device manufacturing and capitalize its presence

offer integrated solutions that support our customers to

in the American region?

improve clinical outcomes through constant innovation.

A: Mexico is already a very important player in the medical

Regarding client relations, we provide staff training and

equipment industry. It moves between eighth and 10th place

equipment maintenance to ensure our solutions are used to

worldwide as a global exporter and more than 150,000

the best of their capabilities. Our goal is to do our training

people work in this industry. Exporting more than 90

state by state; we want to talk to all governments and

percent of its products to the US, obviously that means

determine the particular needs of each. After that, we can

that the country is not looking at the rest of the Americas

find a way to bring most of the doctors in for special days

and perhaps that is an aspect to correct if Mexico wants to

of training, including lectures and demonstrations.

be relevant in Latin America.

The medical sector in Mexico is focused on saving the

Q: How does Dräger México provide a solid platform of

patient. However, we are taking this one step further by

innovation that helps to anticipate the needs and to exceed

creating solutions that help the patient to recover faster.

the expectations of its customers?

Our technology’s success rate also depends on the skills of

A: Being a family business has allowed Dräger to allocate

health professionals, which is the main reason behind the

an important part of its profits, much more than our

training we offer. We are even holding events at universities

competitors, to R&D issues. We are essentially an innovative

to work directly with medical students. Our goal is to

company and that has led us to always be at the forefront of

integrate these events into academic plans, which could

technology. Our focus is on really understanding the needs

have a long-lasting impact on the health sector in Mexico.

of our customers, their pains and how we, as Dräger, can help them to solve those problems.

Q: What are Dräger México’s main goals for the coming years? A: We are focusing to increase our share in the private

Dräger is a German company specialized in medical technology

sector and have redefined our priorities with key accounts

and safety. Its products and solutions target hospitals, fire

to meet their needs. We also want to work with small and

departments, emergency services companies, government

medium-sized hospitals for which we have developed

agencies, mining and other industries

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| VIEW FROM THE TOP

STILL A LONG WAY TO A FULLY DIGITALIZED COUNTRY MIGUEL NIETO President LAR of Carestream

122

Q: How is Carestream contributing to increasing access to

Q: How will digitalization transform diagnostic practices in

healthcare services?

the medium to long term?

A: Carestream provides imaging solutions for many

A: Incorporating technologies into diagnostic practices goes

applications including medical, dental and industrial.

beyond acquiring technology and helping users become

In the healthcare sector, our service portfolio includes

proficient in it; it implies a change in the structure of the

radiologic printing, diagnostic equipment and Health Care

healthcare system. Developed markets, such as Europe

Information Systems (HCIS). Our portfolio allows us to

and the US, have successfully incorporated technology and

provide comprehensive care from the simplest to the most

information systems into their diagnostic practices. In the US,

complicated procedures in the public and private sector. We

for instance, care is provided in a “closed” system where tests,

also provide supplies for every type of imaging technology.

primary, secondary and tertiary care are supplied by a single

We can provide film for laboratories that conduct tests, or

provider. In Mexico, a patient receives primary care from one

even cloud services and AI systems for companies with highly

provider, testing from a different one and secondary or tertiary

sophisticated systems. Technology is a medium for clinics and

care with yet a different provider, which we call an “open”

hospitals to provide better care for patients. As we work with

system. Because of this, digitizing information becomes

radiation, we need to ensure that our solutions provide the

harder as it requires the coordinated participation of many

highest quality standards for image quality in diagnostics,

different players instead of just one.

while minimizing the patient’s exposure to radiation as much as possible. It is also important to maintain low costs for both

The healthcare sector is indubitably migrating toward

the public and private sectors, since the former watches its

digitalization and technology but each player is moving at

finances to stay within budget while the latter does so to

its own pace. We see a mixture of different systems as each

ensure profitability.

player uses the best one for their own purposes. While some are investing in technology and are implementing software

Q: Carestream’s business model changed in 2018 from a

that favor interconnection with other systems, the result is a

centralized to a customer-focused approach. How did this

complex hybrid.

impact Carestream’s services? A: Carestream has clients all over the world and our offices

Q: Compared to the private sector, how ready is the public

are divided among five regions: the US and Canada, Europe

sphere to adopt digitalization practices?

and Africa, Asia-Pacific, China and Latin America. In July

A: Both the public and private sectors are ready for

2018, Carestream hired a new CEO who pointed out that the

digitalization. The public sector is now introducing

centralized model might not equally benefit all those regions.

interesting proposals to improve its internal efficiency

For that reason, we decided to get closer to clients by making

and create synergies through technology adoption. For

our offices more efficient and assertive. The objective of this

instance, one of Mexico’s largest challenges is addressing

strategy is to make us a more agile and customer-oriented

its radiologist shortage, as the country only has about

company with a strong culture and values. It will put us in

5,000 certified radiologists. This is a very small number for

a better position to tackle opportunities for growth in the

Mexico’s large population and most work only in the largest

markets where we participate.

cities. The public sector hopes technology will increase the reach of these and other services that heavily rely on infrastructure and specialists. Clinics in rural areas might

Carestream is a global provider of medical dental imaging

have X-ray equipment but not a local radiologist. Using

and IT solutions, X-ray imaging systems for non-destructive

technology, it is possible for the clinic to send the patient’s

testing and advanced materials for precision films and

tests to a team of radiologists who can send the results back

electronic markets

through the cloud.

VIEW FROM THE TOP |

MEXICO A KEY PARTNER IN MEDICAL DEVICES DEVELOPMENT Enrique Giraud Managing Director of Fujifilm México

Javier Giraud Medical Systems Vice President at Fujifilm México

Q: Why should healthcare companies consider Fujifilm as

imaging device built in collaboration with the University of

their ideal imageology provider?

Guadalajara, which uses 2.5W tubes, unlike conventional

JG: Fujifilm’s value lies in doing things better or differently,

equipment that require tubes between 32-62W. With

offering more and better services at a lower cost. Our

our equipment, patients are less exposed to radiation

operations are based on innovation, which is reflected

and physicians do not compromise the quality of their

in how the company develops its technology and in how

diagnosis. Our third solution, Fujifilm FCR, was designed

it goes beyond commercializing products to providing

in collaboration with mammography doctors to improve

innovative solutions.

breast cancer diagnosis in Latin America. Fujifilm FCR identifies microscopic abnormalities in the breast with

Sometimes it is not necessary to improve the quality of

a single image, allowing for faster detection and early

diagnostic technology but to put quality equipment in the

treatment, if necessary.

hands of clients, especially for the public sector in Mexico. Our global presence allows us to be in touch with current

Q: What led Fujifilm México to collaborate with Lunit and

trends in the healthcare sector and to adapt our offering

Salud Digna on the AI Pilot Project?

accordingly. For example, we know that in Japan home care

JG: Mexico has a limited doctor base, which makes it an

is preferred, which means there is a need for diagnostic

ideal candidate to use artificial intelligence (AI) to grow

devices with greater portability.

and improve clinical diagnostics at health institutions. The AI Pilot Project does not seek to substitute doctors but to

EG: Fujifilm has Open Innovation Hubs all around the world

be a collaborative tool so they can make better and faster

to be close to people developing new technologies. Our

decisions.

experience in different sectors and the interoperability of our products are both core strengths for the company.

Our goal is to have a positive impact on the work of

Today, almost all television screens have Fujifilm accessories

radiologists in three ways: helping them to prioritize

and most all cameras include our color supplements; our

patients, streamlining information through Big Data

solutions transcend the industries they were created for.

applications and developing more precise imaging solutions that require only one take to avoid radiation overexposure.

Q: How has Fujifilm Advanced Research Laboratories

AI will help doctors shorten the time needed for reporting

boosted the company’s technology development process

and diagnosis by 30-40 percent, allowing for more efficient

since its establishment in 2006?

appointments and a higher volume of patients.

EG: Fujifilm wants to develop smaller and portable highquality products with a low level of radiation. Fujifilm invests

EG: Salud Digna is one of Fujifilm’s main partners in Mexico

US$4 million in R&D daily. This constant cash flow, together

because of its radiological offering and sizeable volume of

with several acquisitions of companies that are not only

patients covered through 100 branches across the country.

profitable but that contribute with technological value, are

Access to so many people helps us generate representative

key to Fujifilm’s ongoing product development. We can

data for the entire country, which makes our AI systems

innovate more quickly and think outside the box, unlike

much better.

other companies that tend to react more slowly to change. JG: In Mexico, the company has developed three products

Fujifilm is a multinational company recognized as the world

for the healthcare sector. The first was a digitizer called

largest image and photography company. It has over 75 years of

Prima designed 10 years ago to cater to low-demand

experience in the healthcare sector and other technologically-

hospital groups. The second product was a medical

advanced industries

123

| VIEW FROM THE TOP

ACQUISITION BOOSTS MARKET PRESENCE JUAN PABLO SOLIS Vice President and General Manager of Becton Dickinson (BD) Mexico, Central America and the Caribbean

124

Q: How would you describe the performance of BD’s

Our plants in Mexico manufacture for all of BD’s divisions,

diabetes management products in Mexico?

both for local consumption and exports worldwide. Our

A: In 2018, BD grew significantly thanks to the acquisition of

manufacturing in Mexico has given the company a deeper

Bard, a company with a strong presence in the Mexican market.

reach into key markets around the world. It also allows us

Bard has a large portfolio for surgical interventions, such as

to react to changes in demand in these growing markets.

peripheral stents to manage complications like diabetic foot.

Alongside Asia-Pacific, Latin America has excellent growth

These stents open narrow blood vessels, allowing the flow of

potential for medical devices and having a manufacturing

blood to the foot and can help patients avoid amputations

hub in Mexico is a competitive advantage for us in the region.

in cases of diabetic foot. In addition, with our BD Diabetes care business, we are leading the insulin injection effort and

Q: How is BD adapting its product offering to the needs

providing patients with a wide range of solutions.

of the Mexican market? A: We approach public healthcare institutions in every country

Q: How is the acquisition of Bard impacting BD’s operations

in Latin America to understand their needs and priorities.

and benefiting your clients?

In Mexico, we are closely following the introduction of the

A: We can now offer clients more comprehensive solutions.

National Development Plan and any changes to public

Before the acquisition, BD focused mainly on diagnostics

healthcare policies, which are now heavily focused on

and medical treatment but now we incorporate surgical

prevention and cost containment related to chronic diseases.

solutions. Bard also has many oncological products and is

Mexico must learn to manage these diseases in a timely fashion

a leader in supplies for biopsies of soft tissue, such as for

or its infrastructure will be insufficient to handle the demand.

breast and prostate cancer. The acquisition also allowed

We are participating in campaigns to increase awareness of

us to enter the hernia repair market through the sale of

the dangers of diabetes and we also offer solutions for the

surgical meshes for the abdomen, groin and intestines.

opportune diagnosis of cancer, such as flow cytometers to diagnose leukemia and lymphoma. We offer institutions a

BD’s solutions also complement Bard’s. For instance, we

series of solutions that provide complete patient care, from

manufacture ChloraPrep, a formulation with a solution of

diagnosis to treatment.

chlorhexidine gluconate and isopropyl alcohol that is used to prepare the skin before a surgical intervention. It can be used

Q: How can BD and other companies support the development

alongside Bard’s surgical products. The acquisition allowed

of best practices in the science and medical sectors?

us to generate surgical kits that include the formulation, the

A: BD participated in the second Week of Good Regulatory

mesh and anything else a surgeon may need.

Practices alongside COFEPRIS, addressing a topic of major importance for Mexico: antimicrobial resistance, which

Q: How is your investment in Cuautitlan an added

is causing millions of deaths worldwide. BD is boosting

advantage to continue growing in the region?

awareness of this growing problem through a campaign

A: BD sees Mexico as a manufacturing hub. We have 10 plants

called Resistant Fighter that promotes responsible antibiotic

and 16,000 employees, which means we have the largest

use in foodstuffs, water treatment plans and crop fields. BD

medical devices manufacturing capabilities in the country.

can also contribute in the diagnosis of bacteria resistant to antibiotics. Managing antimicrobial resistance will require the collaboration of many players. Meat producers can help by

health

reducing the antibiotics doses they use in animals for human

technology company focused on IV devices for drug

consumption. The general public can help by avoiding self-

administration, cancer diagnosis, diabetes treatment and

medication and doctors can make the appropriate tests

cellular research

before prescribing a medication.

Becton

Dickinson is

US-based

international

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REDUCED COSTS THROUGH STATE-OF-THE-ART TECHNOLOGY CÉSAR CARRASCO Country General Manager of Philips Mexico

Q: What progress has Philips Mexico made in transforming

This configuration gives the system an extra degree of

its business toward an integrated health model?

freedom with a new arm mounted to its ceiling for greater

A: Besides migrating from a concept of selling products

flexibility of movements and approaches. It requires less

to offering technological solutions in healthcare, Philips

space compared to the Flexmove configuration, synchronized

Mexico’s transformation has been supported by the launch

movement between the flat detector and the collimators and

of different products and platforms that today are successfully

rotation/angulation oriented to the patient.

participating in the market. The main goal is to offer solutions focused on digital patholgy to improve productivity.

Q: How can Philips Mexico improve doctors’ experience and satisfaction?

Azurion was another product launched in Mexico in 2018. It

A: The combination of state-of-the-art technology and highly

will become the next generation platform for image-guided

innovative software creates the perfect environment for health

therapy. This technology will help users perform medical

professionals to take advantage of Philips’ developments.

operations rapidly and securely. Its software, ConnectOS, was

Combined with the medical expertise of physicians, nurses,

specifically designed for the Azurion intervention space to

engineers and other experts, these characteristics support the

enable several experts to work simultaneously. Philips Mexico

decision-making process to enhance diagnosis.

seeks to launch more alternatives during 2019 to continue with its transformation.

Q: How can Philips Mexico’s technology help increase access to healthcare?

Q: What new solutions will Philips Mexico launch in the

A: Standardization and system unification would enable

short term?

effective resource classification and would make it easier to

A: Future products will be launched following three priorities:

identify areas of opportunity. Philips Mexico’s technology can

increasing and improving healthcare access, improving the

help the public sector to fulfill its commitment to achieve

doctor’s experience and satisfaction while using Philip’s

universal access to healthcare by combining technology

technology and lowering operating costs. Philips Mexico

and platforms that enable effective, transparent and secure

has recently launched a product called Philips MR Ingenia

management of the health ecosystem.

Ambition 1.5T, which is 100 percent digital and can operate with a small volume of helium thanks to its revolutionary and

Due to saturation, between 40 and 60 percent of all patients

fully sealed BlueSeal magnet. Philips MR Ingenia Ambition

seeking primary care end up being referred to other levels

1.5T needs only 7L of helium, while other devices require up to

of attention. This results in the unnecessary saturation of

250L. This translates to faster maintenance of only 15 minutes

other care levels. Philips intends to solve the saturation issue

and reduces the device’s noise by 70 percent. It also helps

through a telemedicine platform that helps reduce this issue

hospitals reduce imaging time by 50 percent as Philips MR

by 50 percent. The next step in addressing this problem

Ingenia Ambition 1.5T can scan a complete body in about

could be to compile information coming from this platform

30 minutes.

to have an integrated health informatics solution including electronic medical records (EMR) that can help a hospital’s

Another innovative launch is the new Philips Incisive CT

administrative and clinical areas analyze trends.

that helps healthcare providers to manage operating costs and focus on optimizing patient care. With its first “Lifetime Tube” warranty, Philips will replace Incisive X-ray tubes, a key

Philips Mexico is the local branch of Dutch company Royal

component in any CT system, at no additional cost throughout

Philips. The company has diversified technologies that focus

the life of the system. This year we are also releasing a new

on improving people’s quality of life through innovation in

configuration of the Philips Azurion 7 platform called Flexarm.

healthcare

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| VIEW FROM THE TOP

R&D: THE PATH TO OPPORTUNITIES BEYOND AUTOMATION JESÚS HUERTA Country Manager Mexico and Latin America of DiaSorin

126

Q: How does DiaSorin improve the health and quality of

make it a great solution for blood banks and laboratory

people’s lives through its diagnostics products and what

tests. DiaSorin has a portfolio of over 120 tests. Its goal is

makes DiaSorin different from the competition?

to make a business and health impact on tests for special

A: Our core objective is to improve the health and quality

infectious diseases and MeToo tests, as well as, oncology,

of people’s lives by providing quality diagnostic products

endocrinology, bone and mineral areas.

for early detection of clinical diseases. DiaSorin’s focus is always on the patient. To that end, the company emphasizes

Q: How is DiaSorin positioned in Mexico and what

a humanistic view among its employees, which then

are you doing to increase your positioning in the

translates as a benefit for its customers and end users.

diagnostics industry? A: DiaSorin has a strong international position in the

As a multinational company, our vocation is to always

field of immunology. Within this niche, we specialize in

use science to promote greater benefits for society and

special infectious diseases, which has made us a very

the industry. We also want to have a positive impact on

attractive player for the Mexican market. We are the No.

the environment. For example, our Liason XL product, a

1 manufacturing devices company for infectious diseases,

chemiluminescence analyzer that has been on the market

such as Torch, Zika, Chikungunya and also in the area

for about four to five years, is differentiated by having a

of vitamin D, for which we are the gold standard. The

higher speed than other similar products, a load capacity

company invests a sizable percentage of its revenue in R&D

of up to 25 integral tests and disposable tips to eliminate

so that it can launch eight or nine new biomarkers every

residue, unlike other products on the market. These qualities

year. This helps DiaSorin maintain its position as a leader in innovation, to the extent that it is highly unlikely that our competitors, even together, could match the quantity

DiaSorin is a multinational diagnostic group specialized

and quality of our biomarkers. Our core business is in two

has

niches: immunology for laboratories and the blood bank

subsidiaries and distributors worldwide in the US, Ireland, the

market. In recent years, DiaSorin has positioned with 25

UK, Germany, South Africa, Mexico, Canada, Brazil and more

percent of the blood bank segment.

immunodiagnostic

and

molecular

solutions.

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PARTNERSHIPS BETWEEN TECHNOLOGY DEVELOPERS, HOSPITALS IMPROVE CARE MARCIO MAZON President of Getinge Latin America

Q: How does Getinge differentiate from other medical

Q: What is Getinge’s strategy to ensure it meets its

devices companies in the Mexican market?

clients’ needs?

A: Getinge is a global provider of innovative solutions for

A: Our goal is to go beyond equipping a hospital with

operating rooms, intensive-care units, sterile reprocessing,

medical devices; we want to create value for the hospital

cardiovascular procedures and life science companies

through our solutions. Technology must reduce costs,

such as pharmaceuticals and research labs. It was founded

increase efficiency and, at the end of the day, save lives.

in 1904 in Sweden, which gives us over 100 years of

We work as a team with hospitals, implementing solutions

experience. In 2018, the company made US$2.59 billion in

while sharing the risks and successes. Connectivity plays a

profit. We have more than 10,000 employees and 25,000

significant role in what we do, as well.

customers in more than 135 countries across the globe. Our vision is to become the world’s most respected med-tech

We recently partnered with a European hospital to develop

company and our key differentiator is true understanding

a solution to help surgeons performing cardiac surgery. This

about our customers’ challenges to provide innovative

solution uses artificial intelligence to compare the patient’s

products and solutions that enable better patient outcomes

data with those of the thousands of patients that came before

while enhancing health economics.

to help the doctor make a decision on the patient’s care.

Q: What are the strongest areas in your Mexico portfolio?

Q: Which areas will Getinge focus on in the short term in

A: Our core in Mexico is providing solutions for operating

the Mexican and Latin American markets?

rooms and intensive care units. Around 10 percent

A: Besides our solutions for operating rooms, intensive

of our local operations focus on the sale of products

care, sterilization and cardiovascular procedures, we will

for companies in the life sciences sector, including

focus on delivering first-grade aftersales support. One of

pharmaceutical laboratories. Our main customers are top

the initiatives is to increase connectivity of our current

and mid-range hospitals in the private and public sector

installed base. The goal is to check if the instrument is

and pharmaceutical companies. We see significant growth

working properly, to anticipate failures and to provide

opportunities in the Mexican life sciences sector due to

remote solutions. If it is not possible to solve the problem

the large number of pharmaceutical companies operating

remotely, this can at least provide data to our technicians so

in the country.

they are prepared to service the unit during their first visit.

Our solutions for operating rooms are also popular in

Latin American countries are fast-growing markets and

Mexico. Our goal is to help hospitals get the most out

behave differently from well-developed countries. One of

of their operating rooms, making sure the equipment is

our goals is to increase our presence through products

used to full capacity. We provide a variety of services and

developed for these fast-paced markets. We want to do

equipment to ensure surgical procedures go according

more than sell medical equipment; we want to provide an

to plan. We offer surgical tables, lights, and software to

integral solution to the customer. For that reason, we create

improve hospitals’ efficiency. Another strong area in Mexico

partnerships with customers to develop their solutions. Our

is intensive care, where our goal is to improve clinical

main goal is to save lives by improving care practices.

outcomes and reduce medical stays. We have innovative life support solutions, including ventilators for patients with acute medical conditions and neonatal patients. We

Getinge is a global provider of innovative solutions for

also have strong presence in devices for cardiovascular

operating rooms, intensive-care units, sterile reprocessing,

procedures offering innovative extracorporeal life support

cardiovascular procedures and life science companies and

and intra-aortic balloon counterpulsation.

institutions

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| VIEW FROM THE TOP

SURGERY, SUTURE SOLUTIONS SURPASS SECTOR’S STANDARDS ALEJANDRO VON MOHR Director General of Atramat

128

Q: How is Atramat renewing its portfolio and how do

the price requirements while maintaining the high quality

these products benefit patients?

of the products.

A: 2019 is a very special year for Atramat as we are opening a new branch in our portfolio for anesthetics. We

Q: How has the market received the company’s new

also have a new manufacturing plant in Mexico scheduled

suture with antibacterial coating?

for the end of 2019. Our partners in Turkey have patented

A: This product was launched at the end of 2018 and

several designs and products that are backed by years

received a great reception. Due to its characteristics,

of research, which reduce the risk of infection for a more

it is more expensive than some alternatives but those

tailored and technological approach to healthcare for

who have invested in it have seen positive results. Under

all patients in North and South America. This venture

appropriate asepsis conditions in surgery rooms, sutures

will also help us to provide a complete line of high-

of this type would not be necessary. But on occasion,

quality respiratory circuits aimed at providing the best

procedures fail, especially in open, lengthy or extensive

life support for intensive care, whether at a hospital

surgeries where the patient is subject to potential

or at home.

contaminants for a much longer period of time. In such circumstances, these sutures can help to reduce the

Q: How would you describe the potential demand for

possibility of an infection.

breathing and anesthetic circuits? A: According to our estimates, demand for this circuits is

Q: How is Atramat innovating in the suture market and

on the rise with more than 5 million surgeries in Mexico

what are some of your recent contributions to the sector?

alone. Of those, 70 percent use general anesthesia, which

A: Technological advances for sutures go beyond new

requires a complete circuit for the patient. With these

polymers with different absorption types. We are

numbers, the forecast for sales and use of these circuits

launching a barbed suture based on a monofilament

justify strong investment and development.

structure with a series of barbs stemming from its center. These sutures have a needle at each end, which means

Q: How have changes in public tenders affected Atramat?

closing the wound is done from the center outward. Once

A: IMSS’ 2019 medical devices tender differed from

the suture has been applied, both ends are pulled, causing

previous iterations because sutures and many other

the barbs to hook into the tissue. This procedure halves

device purchases were open to international companies.

the length of the surgery and promotes less scarring.

Moreover, the tender specified a maximum 6 percent price

These barbed sutures have applications in orthopedic

increase in Mexican pesos. While most of our products

and plastic surgeries.

are manufactured in Mexico, our overhead surpassed 6 percent by far due to increases in the minimum wage, a

Q: What infrastructure investments is Atramat planning

more expensive dollar and higher costs for some of our

to improve its operations in Mexico?

raw materials due to higher oil prices. We made great

A: The first is to open our own sterilization plant for the 90

efforts to lower our prices for these tenders and we did

percent of our products that are sterilized using ethylene

win them, so we are now facing the challenge of meeting

oxide. This project is part of our vertical integration strategy to strengthen our presence in Mexico and Latin America. By allowing us to control our sterilization

Atramat is one of the world’s largest suppliers of surgical

process, this plant will increase our sterilization speed, thus

sutures. The company has over 50 years of experience. It

optimizing our services and helping us to manufacture

belongs to Internacional Farmacéutica and its products

more products at lower production costs. This plant will

are sold in over 80 countries

be operational by the second half 2019.

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PATIENTS: MARKETING TARGET TO GROW HOMECARE RESULTS CARLOS JIMĂ&#x2030;NEZ Director General of B. Braun Mexico

Q: What are your strategies and priorities for the coming

even though it is our smallest division. We have seen

years as the new head of B. Braun Mexico?

good results and have good expectations in chronic

A: In 2018, we started a consolidation process that we

wound care. Diabetic patients, for example, have many

have yet to complete. In the past, we operated through

problems related to chronic wounds. There is also

two separate entities but we decided to act instead as B.

significant demand for colostomy bags and ostomies

Braun Mexico under a single leadership. This strategy is

and incontinence products. Incontinence is a growing

client-focused and oriented toward patients and health

segment, although patients are reluctant to wear diapers.

professionals, assigning only one executive per client for

To address this, we are providing other devices that

all B. Braunâ&#x20AC;&#x2122;s solutions. The company has 5,000 product

are used at procedures that can be performed at an

lines, around 120,000 SKUs and in the commercial area

ambulatory center or even during a medical consultation.

we have over 200 people. Our new strategy gives clients

We have not released these last three product lines in

a single point of contact with the company, which avoids

Mexico, but we are already very active in wound care.

having to translate our internal complexity to clients. Q: What strategies are you implementing to market B. Q: How is B. Braun adapting to the homecare trend

Braun products not only in the private but also in the

and what other trends could impact the medical

public sector?

devices sector?

A: We are waiting for the details of how the universal

A: The homecare market is growing and will gain

health system will work in the country. An increase in the

importance in Mexico and the rest of the world. Although

number of people with access to health services is truly

it is an important part of the patientâ&#x20AC;&#x2122;s care, homecare is

favorable. What we would need to review is how this is

not a substitute for specialized care centers. We need

going to be financed, because the idea has always been

to have a combination of ambulatory attention and

to keep costs low. I hope the government can deliver on

homecare. But the latter, at the moment, is restricted

its promise to increase GDP expenditure in health from

because it has to be paid out of pocket and is not

6 percent to 8 percent. We understand that the public

reimbursed by any insurance company.

budget is undergoing a period of reorganization, so I hope that after this phase we will see more investment in 2020.

Another issue that is hindering homecare is that for nonOTC medical devices, the law prohibits direct advertising.

In general, in Mexico we spend very little on health

This is a topic that we need to review to see if the

services and a lot on the administrative side of

scheme can be opened somehow so that homecare can

healthcare. A universal health system could solve this

go accompanied by mass communication. This could be

but the government must take the necessary steps in

regulated by COFEPRIS or any other entity, as long as we

that direction. For instance, for homecare, we could hire

can target marketing campaigns toward patients.

nurses and provide companion services, but for that we need to know what will be the homecare system that

Q: Which B. Braun division has enjoyed the best

social security will finance so we can prepare adequate

performance in the country?

solutions.

A: We have four divisions: Aesculap, which is related to patient chirurgical care; Hospital Care, focused on hospital supplies for patient care; Avitum, that focuses

B. Braun Mexico is a subsidiary of the international B. Braun

on hemodialysis and Out Patient Market, the division

Group, one of the leading providers of healthcare products and

dedicated to homecare. So far, Out Patient Market

services in the world with 180 years of experience. Its products

has delivered the largest, scoring double-digit rates,

include devices for general surgery and cardiothoracic surgery

129

| TECHNOLOGY SPOTLIGHT

130

ATRAMAT: 50 YEARS OF SUTURING QUALITY Fifty years ago, Internacional FarmacĂŠutica and its Atramat brand were consolidated, focusing on the production of surgical sutures to reduce tissue trauma. Atramat was also a pioneer in packaging innovation that would ensure that surgical sutures are kept in perfect condition until they are used by surgeons. Today, Atramat is a global brand recognized for having one of the most complete portfolios of surgical sutures. It is used by surgeons around the world to close thousands of wounds daily, with absorbable and non-absorbable materials coated with antibacterial and strands with fixation systems that facilitate aesthetic wound closure. Over the past decade, we have extended our portfolio of medical devices inspired by the trust that surgeons put in our products. In collaboration with some of the world's finest producers, we are adding a full line for minimally invasive spinal implants, anesthesia and ventilation circuits for wound closure to our product portfolio. Atramat is also developing new devices to continue expanding its portfolio. Our involvement in the worldwide medical devices industry is increasingly strong and is based on the need to maintain a quality culture supported by our certifications, including ISO13485: 2016, CE mark and MDSAP. We are convinced that our success is the result of a combination of leadership, innovation, technology, quality and passion to offer safe products for patients.

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| VIEW FROM THE TOP

MEDICAL DEVICES NEEDED TO BOOST ACCESS, HOME CARE ROGER BROWNRIGG Vice President Regional of Johnson & Johnson Medical Devices México

132

Q: How has Johnson & Johnson evolved to make its

Q: How can the private and public sectors work together

offering stand out in the market?

to increase healthcare access in remote and hard-to-

A: Around 10 years ago, our medical devices division

access areas?

focused on the product itself. The premise was to

A: We cannot build a hospital in every town in the country.

differentiate ourselves by developing products that were

There is not enough money to build so many projects or

faster, reduced bleeding or helped the patient recover

to properly equip them. Similarly, there are not enough

faster. Today, our focus has evolved from products

doctors and nurses to work in every municipality. This

and services to solutions. Instead of just focusing on

means we need to start using different technologies and

technology, this new approach has broadened our vision

work on a collaboration strategy.

by putting patients front and center and integrating our products and services to offer a holistic solution.

An example is using the existing private sector infrastructure to provide better public health services.

Talking about solutions also forces us to consider all

We are working on a project with the Ministry of Health of

players and elements that impact the health ecosystem

Coahuila to address cases of morbid obesity in the state.

and how different actors can share risks and benefits.

By drawing from our experience working with other local

The idea is to create a more integral environment that

ministries of health and specialized centers, we helped

considers prevention, diagnosis, treatment, rehabilitation

the Ministry of Health of Coahuila generate an integral

and reincorporation to normal life. We do not only

plan for treating these patients.

focus on the operational part of the business; we have a responsibility to listen and generate solutions for

Q: What opportunities has Johnson & Johnson identified

the future.

in medical devices for homecare and how can they contribute to boost prevention?

Q: What elements should be taken into consideration to

A: Hospitals should be for people with critical conditions.

ensure universal health access in the country?

We are making a lot of changes in our portfolio and even

A: The definition of access changes depending on how

though we have not necessarily made efforts to venture

you ask. According to some, access entails free medicine

in this type of care, we have tried to reduce surgeries

for everyone, which generates the dilemma of how to

in hospitals. There are many surgeries that could be

ensure free and universal availability. However, when

ambulatory, but that requires quality devices and proper

talking about access, we also need to consider quality,

protocols. Recently, we have also started selling our line

the patient’s clinical outcome and patient satisfaction.

of glucose monitors, which is No. 1 in the Mexican market.

Quality always needs to be part of the overall health ecosystem; it cannot be negotiated neither for medicines

Q: What are Johnson & Johnson’s main goals for 2019?

nor medical devices. A patient’s clinical result must

A: There is a great deal of uncertainty in the sector due

always be analyzed according to that patient’s lifestyle,

to the changes the government wants to make. Although

considering economic costs and the responsible use of

many of them are good, the administration should not

technology.

move forward without knowing how the changes will be implemented. We do not know how the year will end, but we have a responsibility to participate in the debate

Johnson & Johnson Medical Devices Companies has over a

regarding what is the best health system for the country

century of expertise tackling pressing healthcare challenges

to provide access to quality and affordable care. Our

and collaborating in creating new standards of care in surgery,

commitment to Mexico is to reach more patients and

orthopedics, vision and interventional solutions

restore more lives.

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ENGINEERING COMPANY SEIZES MARKET OPPORTUNITY JUAN DOVARGANES CEO of Arroba Ingeniería

Q: Why did Arroba Ingeniería decide to direct its efforts

become simply unaffordable. Arroba Ingeniería, therefore,

to neonatal care technologies?

decided to develop and manufacture technology for most

A: Arroba Ingeniería was created in the early 1990s

premature babies at affordable prices. The company’s

by a group of biomedical engineering graduates from

goal is to democratize healthcare and to make access to

Universidad Iberoamericana who thought the health

quality medical attention a right for everyone.

sector would be greatly improved by technological advances in medical devices. Most medical devices in

Q: Which export markets could be attractive for your

Mexico are provided by foreign manufacturers, mostly

products and why?

American and European. Designing and manufacturing

A: Bolivia, Peru, Colombia and Ecuador are the most

these devices in Mexico seemed promising for Arroba

attractive markets to begin with. However, we believe our

Ingeniería.

products are perfect for any country, especially in the emerging segment. Latin American countries have a lot

In 1992, the company identified an opportunity to provide

in common with one another and we think targeting this

incubator maintenance services to various IMSS hospitals,

region first is the most appropriate strategy.

but the original parts needed were no longer available because American producers had discontinued them.

Exporting is always a challenge because we need to

Arroba Ingeniería developed and manufactured its first

understand the commercial and regulatory differences

digital controllers to serve these clients. These controllers

between Mexico and other markets. We are looking

allowed maintenance of a broad infant incubator base at

for commercial partners in different Latin American

a low cost. Our growing expertise in this sector led us to

locations. We predict we will be exporting our devices

our current focus on neonatal care devices.

by 4Q19 or 1Q20.

Q: How can Arroba Ingeniería provide an added value to

Q: How will the development of the global incubator

its clients, when compared to its competitors?

market impact Mexico?

A: Arroba Ingeniería offers two lines of incubators, radiant

A: Mexico has an open economy that allows us to trade

warmers and phototherapy lamps. The first line is based

with several international markets, which gives us the

on progressive technological development and has

opportunity to, on the one hand, access supplies and

diverse functions, options and accessories to cover the

components from different developed countries, such as

requirements of highly specialized hospitals with neonatal

the US, the EU and even China. On the other hand, it

intensive-care units (NICU). In these units, devices must

opens the door to offer our products to a wide range of

be able to control temperature, oxygen and humidity and

countries with similar characteristics to ours. Additionally,

monitor physiological variables such as oxygen saturation

we have a young population, with many talented

and pulse rate. Due to their complexity, incubators are also

engineers and technicians. With the right focus, they

operated by highly specialized personnel. Considering

can create technologically outstanding and high-quality

that between 5 and 15 percent of births in Mexico are

products that may give us the chance to participate in

premature, Arroba Ingeniería developed a specialized and

the international market.

affordable line for this segment. This line can be used by 90 percent of the babies born between weeks 32 and 37. Arroba

Ingeniería is

Mexican

engineering

company

Medical care is growing in sophistication, complexity

specialized in the development of medical devices. It is

and cost. Hospital investment in technology is extremely

designing a solution to diagnose children’s vulnerability to

high and in the long term, access to healthcare could

diabetes

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| VIEW FROM THE TOP

THE FUTURE IS IN HEALTH SOLUTIONS RODRIGO DÍAZ DE VIVAR Subregional Head of Management Center Latin America North and Country Manager of Roche Diabetes Care México

134

Q: How does Roche Diabetes Care ensure the highest

Q: What mechanism could help reduce the country’s

innovation and quality in its products?

diabetes burden?

A: Roche Diabetes Care is transforming from being a provider

A: Beyond encouraging technology penetration in the market,

of individual products to generating a value proposition

the main focus should be on providing proper information

based on services. Although Roche Diabetes Care has offered

about health management through technology. It is important

for many years hardware solutions of medical devices to both

that professionals in charge of people’s health have constant

the public and private sectors, today it combines this with

training on how to make the most of technology. The best

integrated and tailor-made health management software.

technology is that with well-known benefits and that is used

This implies personal disease management based on our

to its full capacity. Roche Diabetes Care continually supports

three pillars: hardware, such as glucometers; digital tools,

health professionals, including doctors, nurses, technicians

such as the mySugr app and a digital platform for health

and other experts in knowing how to use these devices to

professionals and payers to manage the patient.

ensure maximum benefits.

Diabetes is a disease that has an extended social context.

Digital platforms are also important to support healthcare, as

Through these services, patients have integral control of their

these provide appropriate, orderly and transparent patient

health, from their nutrition, exercise and education regarding

management with efficient follow-up. Similarly, value-added

their treatment and its management.

services, such as nutritional and lifestyle support are as important as an individual performing regular glucose checks.

Q: What incentives or mechanisms would increase innovation

Health is a topic that covers different aspects of a person’s

in medical devices for diabetes management?

life, which is why health solutions must be comprehensive.

A: Diabetes in Mexico is a severe disease with a prevalence of 13 to 14 percent in a population of about 130 million people.

Q: What are Roche Diabetes Care’s plans for the near term?

This means there are almost 15 million people living with

A: Traditionally, Roche Diabetes Care has had a strong

diabetes. More than half of the people are not diagnosed

focus on the commercialization of medical devices, such

and of those diagnosed, only 5 percent are undergoing

as glucometers, test strips and capillary devices. Starting

treatment.

in 2019, as part of our goal of offering a comprehensive health solution to patients with diabetes, the company is

Roche Diabetes Care has now brought a new pilot product

launching several new solutions in the market. The first is an

to the Mexican market called SugarView. The idea of this

insulin pump called Accu-Chek Combo, which integrates a

product is to measure sugar levels without a medical

microinfuser, a measurer and software in a discreet and safe

device and through an intelligent photograph of a test

piece of equipment.

strip with a blood sample. A pilot test is being done with 1,000 patients and Mexico has become an important

In mid-2018, Roche began working on introducing a product

ally for the company. This product is designed to be a

called Eversense, the first implantable sensor for six-month

much more effective, less invasive and more cost-efficient

use. Eversense is indicated for the continuous measurement

solution for patients.

of glucose levels in interstitial fluid in adults through a removable transmitter and a smartphone application. With this system, patients can improve management of their

Roche Diabetes Care , under the brand Accu-Chek, creates

diabetes and glucose levels. The Eversense app allows the

value by providing integrated solutions to monitor glucose

user to check glucose concentrations in real time and see

levels, deliver insulin and track and contextualize relevant data

how levels are evolving. It also stores data and shares it in the

points to contribute to a successful therapy

cloud so it can be accessed by care providers.

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OPEN MARKET NECESSARY TO BOOST COMPETITIVENESS MIGUEL SOTO General Manager of Mindray Medical México

Q: What are Mindray Medical’s strongest areas in the

Q: How is Mindray Medical México growing its penetration

Mexican market?

in the public sector and with public-sector clients?

A: Mindray Medical México began operations developing

A: The public sector follows an integration scheme as there

patient monitoring and life support devices, followed by

is no single company that can provide the entire portfolio

ultrasound equipment and IVD lines. In Mexico, our main

of products the sector needs. At the same time, the rules of

strength is in the patient monitoring and life support

the game favor the industry over the patient. Government

(PMLS) subsector, which is valued at US$500 million in

organizations are ordered by law to open tenders to foreign

the country. Demand for these products is high but there

suppliers, but public institutions, such as IMSS and ISSSTE,

are few sellers because development of this technology

are unable to buy products from countries that do not have

has a high entry cost. Our PLMS products are often bought

FTAs with Mexico. This puts some countries in a better

by new hospitals and in fewer cases, to replace existing

position to trade with Mexico. Regulations should be revised

equipment in the public sector. At this point, our PMLS

to allow other countries to offer better deals to public

products hold 12 percent of the market in the public sector.

institutions and provide patients with better technologies.

Q: How is Mindray Medical México expanding its other

Q: How does Mindray Medical balance technology

business lines among potential clients?

development with its cost-containment strategy?

A: We sell less ultrasound equipment than PMLS systems.

A: At Mindray Medical, we understand that we will become

Hospitals may require a monitor for every other bed but

competitive in the international market through quality

their imaging departments often require only a handful

and innovation. Our products are now fully focused on the

of ultrasound equipment. Our ultrasound products are

needs of the end user. We study the market and develop our

targeted toward the many imaging and diagnostic centers

products accordingly. Mindray Medical has been in Mexico for

instead of hospitals or clinics. Most laboratories operate as

11 years. To consider bringing manufacturing and technology

chains, where franchises collect all samples and send them

development operations to the country, Mexico would need

to a central laboratory to be processed. Our goal is to place

to ensure certainty in its regulatory and economic framework.

Mindray Medical equipment in these central laboratories. At

The country is now the No. 1 exporter of medical devices in

this point, we have 18 percent of the market for ultrasound

Latin America thanks to the support and innovative efforts

equipment in private sector laboratories. We are developing

from the public and private sectors.

our supply chain to increase our penetration in this segment. Mindray Medical México also provides laboratory equipment

Q: How will Mindray Medical make a difference in the

for chemical analysis, hematology and immunology, the

Mexican medical devices industry?

latter having the most potential in the Mexican market.

A: The medical devices industry traditionally launches a product every six to 10 years. On the contrary, Mindray

Q: How does Mindray Medical México help doctors improve

Medical, and Chinese companies in general, offer around six

diagnostics and make better treatment decisions?

different new products per year. We are changing paradigms

A: Mindray Medical México is a challenger of the status

in the market. The medical devices sector is often slow to

quo and operates based on three axes: quality, technology

change but it is increasingly adapting to new work models.

and low cost. We use simple, accessible and user-friendly technologies that allow medical professionals to make better use of their time and to focus on what is most important:

Mindray is a Chinese manufacturer of medical devices for

the patient. Moreover, due to its Chinese roots, Mindray

patient monitoring and life support, in vitro diagnostics and

Medical was created following strong cost-containment

medical imaging systems. It was founded in 1991, has presence

principles to adhere to local cultures and needs.

in 39 countries and 31 offices in China

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| VIEW FROM THE TOP

TECH INVESTMENT BRINGS SUPERIOR LONG-TERM SAVINGS GERMÁN GARCÍA LATAM AWM Regional Director at Smith & Nephew

136

Q: Smith & Nephew’s 2018 results show the company

in the Mexican market, such as the low penetration of

performed better in emerging markets than in other more

medical device and a fragmented health system that

established regions. Where does Mexico fit in?

hinders growth of the medical devices segment due to

A: Mature markets like Europe and the US are growing at

issues like access.

a 2-3 percent rate annually, in comparison to emerging markets with rates of 15 percent. Approximately 17

The company has three core business units: orthopedics,

percent of Smith & Nephew’s global revenue comes from

traumatology and wound care. The latter is the unit with

developing markets.

the least penetration in the country. Public institutions prioritize price over efficiency, so public hospitals tend to

The main driver behind this growth is the size of the

use dressing, alcohol and basic products. Smith & Nephew,

population in these regions, coupled with the low

on the other hand, manufactures products with greater

penetration of medical care, which makes new medicines

innovation and technology that in the long run are more

more attractive than in more mature markets. Compared to

efficient for treating wounds. Smith & Nephew wants to

other Latin American countries, Mexico still has one of the

increase the use of its products in Mexico so more people

lowest rates in terms of health coverage and penetration

can have access to state-of-the-art technology.

of medical devices. In comparison, Colombia has universal healthcare and 98 percent of its population has access to

Q: What are the reasons behind the low penetration of wound

medical devices.

care devices in Mexico? A: The limited use of advanced medical devices for wound

Q: What opportunities and obstacles does Smith & Nephew

care in public hospitals has made private hospitals and

expect from the merger between Seguro Popular and IMSS,

pharmacies the strongest points of sale for these devices.

in terms of penetration of medical devices?

When a patient arrives at a public health institution, normally it

A: Most opportunities will come from people affiliated

lacks advanced dressings and the patient is asked to purchase

with Seguro Popular who will now have increased

them at the pharmacy. Only those patients who can afford it

access to surgeries, treatments and other therapies. The

have access to wound care technology. The impact becomes

disadvantage is the lack of infrastructure because there

more evident when hospitals have nosocomial infections,

are not enough facilities to care for the 50 million people

longer patient hospitalizations and higher medical expenses.

registered with Seguro Popular. This merger will require a huge investment in infrastructure and health expenditure,

Q: How have Smith & Nephew’s R&D operations improved

which could represent over 6 percent of the national GDP.

after centralizing them under a single president of Global R&D?

Q: Smith & Nephew’s 2018 results also state the company

A: Our goal is to grow efficiency and minimize expenditures.

wants to “reach the full potential of its portfolio.” What

This is also a proactive strategy to bring technology closer

does this mean and how do you plan to reach that goal?

to the population in developing markets with a reduced

A: Smith & Nephew wants to properly distribute its entire

income and high out-of-pocket healthcare expenses. Smith

portfolio across the country. However, there are constraints

& Nephew wants to become the ideal solution for those midtier segments looking for high-quality products at an affordable price. For example, the company launched a total

Smith & Nephew was founded in 1856 as a pharmacy in England.

knee prosthesis called ANTHEM that employs an advanced

Now, the company is present in more than 90 countries and it

femoral and tibial anatomic design to promote improved

is the world’s largest producer of arthroscopy products and the

anatomic implants fit for midtier patients in emerging

second-largest manufacturer of advanced wound-care products

markets and Europe.

VIEW FROM THE TOP |

HOSPITAL BEDS CRITICAL MEDICAL DEVICES MAURICIO VALERO Managing Director of Linet Group in Mexico

Q: What will be the main challenges for the healthcare

worked together for more than twenty years. In 2016, Linet

sector in the coming years and how is Linet Group

Group expanded its business with the acquisition of a majority

addressing these?

stake in BORCAD Medical to complement Linet Group’s and

A: Mexico and other countries in Latin America are

Wissner-Boserhoff’s portfolio of nursing beds and geriatric

experiencing a rapid change in their demographic pyramid,

furniture with gynecology, neonatal and dialysis chairs.

forcing healthcare institutions to adapt to the needs of an aging population. By 2030, Mexico is expected to have 10

Q: Why did Linet Group choose Mexico to establish a

million adults over 65 years of age, which represents a 370

corporate office and how has that impacted your operations

percent increase compared to the 2.7 million registered in

in the country?

2018. The country has approximately 4,000 hospitals, 3,000

A: Linet Group focused for many years on the European

of which are managed privately while the rest fall under

market and only expanded to other continents after

government jurisdiction. Yet, public hospitals from IMSS,

opening an office in the US. Mexico was Linet Group’s

Seguro Popular, ISSSTE and other public institutions serve

second office in the Americas, which was a natural step

the vast majority of the population. Linet Group’s strategy

due to the country’s geographic location that allowed the

to tackle the public sector is based on offering quality beds

company to capture more clients and serve the Andean

at an affordable price.

region. Linet Group later decided to open its Brazil office in Sao Paulo to target Latin America, another in Dubai to

Linet Group is one of the Top 4 largest bed manufacturers

tackle the Middle East and one more in Australia. Linet

worldwide, which allows the company to offer more cost-

Group’s goal is to be present in strategic countries and

efficient proposals than its competitors. The company’s

to have indirect representation in over 100 countries.

priority at the moment is to be the leader in the Americas,

Linet Group is one of four hospital-bed manufacturers

with growth centered on the chronic care and nursing home

worldwide with the capacity to supply any market and

segments. We also want to continue developing consciousness

the know-how to develop global products.

about the importance of bed maintenance, since these are key medical devices and not just common furniture.

Q: How has your international experience helped you understand the Mexican industry?

Q: What is Linet Group’s perspective regarding the merger

A: Contrary to common belief, the Mexican health system, its

between Seguro Popular and IMSS?

health-related processes and the way products and services

A: Rather than a change, this represents a simplification of

are purchased to provide medical care are more similar to

the healthcare system in Mexico. This merger will create a

Turkey, for example, than to the US or Brazil. The US has no

more simplified way of managing resources and it will avoid

federal or state health providers, only private companies;

redundancies between IMSS, ISSSTE and Seguro Popular

Brazil’s commercial policies are conservative and oriented

since Mexicans can be affiliated to one or more of these

toward protectionism, posing several obstacles to foreign

institutions. Universal access to healthcare will allow the public

investment. Like Mexico, Turkey and Chile have a more open

health sector to use any available resources to address the

approach and have actively promoted the participation of

needs of the population. Afterward, it will be easier to identify

international companies through public tenders.

in which processes the private sector can collaborate. Q: How has Linet Group’s relationship with Wissner-Boserhoff

Linet Group is a major European manufacturer of hospital

impacted the company’s operations?

and nursing beds. The company’s portfolio includes solutions

A: Linet Group was born from the collaboration between the

designed for intensive care, regular in-bed treatment and beds

Wissner-Bosserhoff Group and the Linet Group, which have

for nursing homes and long-term care facilities

137

| INSIGHT

QUALITY MEDICAL DEVICES NECESSARY TO IMPROVE CARE JOSÉ RAMÓN VELASCO General Manager of Essity Medical Solutions Mexico

138

While some clients still have a price-oriented vision, a

patients the opportunity to continue their treatment

comprehensive cost-benefit analysis ultimately can be

in the comfort of their own home, which is a growing

better in the long term, says José Ramón Velasco, General

trend especially in the out-of-pocket sector. “Wound

Manager of Essity Medical Solutions Mexico (Essity).

care products are transforming for home care purposes.

“By promoting faster healing, patients can more easily

The sector is evolving to give patients more control and

recover and leave the hospital sooner. As a result, public

empower them to treat wounds by themselves at home.”

and private hospitals spend less and provide better care,” says Velasco.

Essity’s education efforts are also aimed at the general public. “About 70 percent of Mexicans are at risk from

Essity is a global leader in hygiene and health products

chronic venous insufficiency (CVI) and most are unaware

that manages a broad range of popular brands including

of it,” says Velasco. CVI is a medical condition where

TENA, Regio and Saba. In 2017, the company acquired a

leg veins become damaged, which makes blood flow

health business that focuses on wound care, compression

backwards and prevents it from reaching the heart. The

therapy and orthopedics. Essity has introduced these

condition is exacerbated by age and sedentarism.

three divisions to the Mexican market as part of its strategy to improve care through prevention. “Mexico

To tackle this disorder, Essity’s compression therapy

has an opportunity to improve its prevention culture. The

division developed JOBST compression socks, which

use of medical devices as prevention mechanisms could

improve blood flow and reduce swelling. “We are also

address the problem at its roots. It is necessary to change

raising awareness among the general public of the

this culture to develop a model that fights diseases more

benefits of these products and where they can acquire

effectively,” says Velasco.

them. There is a misconception regarding compression socks as some believe they are used only by seniors,

In its wound care division, Essity offers acute and

which is not the case. Compression socks can be used

advanced products. The latter are specialized, high-

by younger people who exercise and want to remain

technology solutions that promote faster healing and also

healthy,” he says. The company also developed a sports

control infections. Essity provides an integral solution

line of compression socks called JOBST Sport, which

that addresses every stage of wound healing. Its portfolio

was introduced to Mexico in late 2018 to support sports

includes surgical tapes, dressings, foams with ultra-

enthusiasts.

absorption and DACC technologies for infections. Velasco warns that while these products bring many benefits to

The company’s positive reception in the Mexican market

patients, doctors and nurses often do not know they exist.

has led it to develop an ambitious growth plan. “We want to grow at a double-digit rate for the next five years and

To address this, the company is strongly investing in

for each of our product lines to grow at least twice in

training for healthcare professionals. “To position our

terms of market rate,” says Velasco.

Advanced Wound Care products, we have to invest in educating the market. We are working alongside the

The company plans to strengthen its three sales channels:

Permanent Nursing Commission to develop a robust

public and private hospitals, retail and pharmacies and

education strategy to spread the word on the benefits

e-commerce. Essity will continue to prioritize education.

of using these technologies,” he adds.

“We believe it is the industry’s job to raise awareness of what these products can bring to the sector and how they

Essity also wants to empower patients and help them

can bring a positive cost-benefit balance for public and

to better manage their own care. The company offers

private health institutions,” says Velasco.

VIEW FROM THE TOP |

AWARENESS NEEDED TO GROW MANUFACTURING QUALITY LUIS GARDUÑO Partner and CEO of Art-Técnica

Q: What can Art-Técnica offer its clients that its

A: There needs to be greater awareness regarding

competitors cannot?

the importance of quality in biomedical engineering.

A: We have three priorities: quality, technology and a

When manufacturers emphasize quality, standards rise

strong ethical profile. Our solutions allow for medical

accordingly. At the same time, there should be a stricter

equipment that delivers quality for both patients and

regulatory framework that forces companies to work in

doctors. Our people and the brands we manage —

line with international guidelines. That would help the

including Fluke Biomedical and Raysafe — must be

market take the next step toward competitiveness and

oriented to offer the best possible solution in the market.

specialization.

At the same time, considering that the Mexican market is not that mature in terms of regulations, we strive to

Q: Once enforced, how will USMCA impact the medical-

follow an ethical business model that makes quality our

devices sector?

top priority, thus providing an advantage to our clients.

A: On the one hand, the agreement will strengthen the US economy, which will lead to devaluation of the peso

Q: What strategies have you implemented to showcase

and higher prices, given that most pieces of equipment

the advantages of brands like Fluke Biomedical

are priced in dollars. On the other hand, USMCA will also

and Raysafe?

homologate certain manufacturing standards across the

A: We work in a niche market targeting biomedical

region, which will help Mexico adapt its regulations to

engineers, which means that good references are

meet international quality standards. The challenge for

essential to grow our business. To get these, we rely

SMEs in the sector will be to develop their workforce’s

on the high quality of our product portfolio and the

competencies to ensure efficient results. One of our

advanced qualifications of our personnel, all of whom are

priorities is to look for forums and similar avenues

experienced enough to get any international certification

that provide us the opportunity to participate in the

available. We are certifying our personnel and processes

development of standardized regulations and their

with the Mexican Certification Entity and our goal is to

implementation.

become a reference in medical equipment manufacturing and the development of biomedical engineering in Mexico

Q: What are your priorities for Art-Técnica in the

and Latin America, as well as an enabler of quality in the

near future?

day-to-day operations of hospitals and clinics.

A: We see the healthcare market growing in Mexico and Latin America. This will spur the participation of

Our goal is to establish close relationships with quality

more project integrators and these are Art-Técnica’s

equipment-manufacturers. Consequently, we have seen

targets. These players are in charge of finding the right

greater dynamism regarding local manufacturing, which

suppliers to build and ramp up the operations of any

has opened the door for Art-Técnica to offer its products

new healthcare facility. Integrators make their decisions

as a way to ensure optimal functionality. We play a key

based on quality and price and, as managers of different

role in helping local companies grow their competitiveness

brands in the biomedical engineering subsector, we can

and work under international standards, which allows

help them effectively identify the best suppliers.

them to expand their client base beyond Mexico’s borders. Once they incorporate the latest technologies, they can standardize their processes to reduce production costs.

Art-Técnica is a Mexican metrology company that offers products and services to biomedical and clinical engineers.

Q: How can the market become mature enough to

The company represents brands like Fluke Biomedical and

compete with other international medical-devices hubs?

Raysafe

139

PHARMACIES &Â LABORATORIES

Pharmacies, along with other sales channels, are the main point of access to medicines for patients. In recent years, other players with digital platforms and technologies have entered the market, which has generated greater competition and the need for differentiation. Traditional pharmacies seek to incorporate technological solutions to their operations and at the same time new players seek to offer increasingly innovative solutions. Meanwhile, the clinical analysis market is gaining strength in the country with the growth of chronic-degenerative diseases, making laboratories an important ally in boosting prevention and providing timely diagnoses.

Pharmacies & Retail evaluates business opportunities through interviews focused on the primary sales points for drugs, such as pharmacies, big supermarkets and new players to the medicine retail industry. The chapter shows how clinical laboratory leaders see the sectorâ&#x20AC;&#x2122;s involvement in enhancing public health through prevention, as well as the difficulties and possibilities for expanding to other regions of the country.

141

CHAPTER 7: PHARMACIES & LABORATORIES

144

ANALYSIS: New Business Models Put Pharmacies in New Role

145

INFOGRAPHIC: Pharmacy and Supermarket Opportunities to Improve Healthcare

146

VIEW FROM THE TOP: Macedonio Garza, Farmacias Benavides

148

VIEW FROM THE TOP: Miguel Reyes, Farmacias Purex

149

VIEW FROM THE TOP: Guillermo Martorell, Grupo RFP

150

VIEW FROM THE TOP: Ricardo Martí, Walmex

151

INSIGHT: Christian Vega, HEB Mexico

152

INSIGHT: Raúl Caballero, Farmacias Especializadas ProbeMedic

153

VIEW FROM THE TOP: Francisco Cantú, Fármacos Proasse

154

INSIGHT: Emiliano Hernandez Laos, Knaou

155

VIEW FROM THE TOP: José Carlos Pérez y Pérez, Grupo Diagnóstico Proa

156

VIEW FROM THE TOP: Mario Sicilia, Laboratorio Médico Polanco

157

VIEW FROM THE TOP: María de la Paz, Laboratorios Clínicos de Mérida

Daniel Duarte, Laboratorios Clínicos de Mérida

158

INSIGHT: Oswaldo Basto, Quimialab

159

VIEW FROM THE TOP: Raúl Solís, Laboratorios Diagnóstica

161

ROUNDTABLE: How is Your Company Revolutionizing Medication Distribution?

143

| ANALYSIS

NEW BUSINESS MODELS PUT PHARMACIES IN NEW ROLE Pharmacies are moving away from being simple points of sale for health supplies with a focus on medicine preparation to include logistics, clinics, education and research functions aimed at patient safety, as well as the rational use of medications Pharmacies started as drug preparation centers but they

Central America (Walmex), for example, operates in over

have evolved to become an integral component of health

648 stores across six countries in the region: Costa Rica,

access. Two trends are responsible for the transformation,

El Salvador, Guatemala, Honduras, Nicaragua and Mexico.

according to ANAFARMEX: digitalization and the concept

“Walmex receives over 5 million clients per day, which

of well-being.

provides a great opportunity to increase access to health,” says Ricardo Martí, Commercial Director Pharmacy, Health

144

The first, technology, has provided a path to different

and New Businesses of Walmart, Bodega Aurrera, Superama

business models that give the patient more freedom while

and Sam’s Club.

allowing pharmacies to expand their services. More is on the way, say industry leaders like Emiliano Hernandez, Co-

PREVENTION

founder of Mexican pharmacy startup Knaou. “Without a

Mexico’s aging population poses another dilemma, and

doubt, technology will change the Mexican pharmacy sector

many see prevention as the cure. An aging population is

as it has changed other sectors such as retail.”

a challenge for the public health system because there are more and more elderly patients with many multimorbidities,

Hernandez adds that new technologies can address gaps

such as cardiovascular diseases, cancer, chronic kidney

in healthcare services. Knaou, for example, provides a

disease and diabetes, according to the article The Aging

subscription-based system that facilitates medication

population: A challenge for public health, published by

delivery. “People do not want to leave their homes and they

the Colombian Journal of Anesthesiology. Mario Sicilia,

do not want to spend time traveling to pharmacies or other

Commercial Director of Laboratorio Médico Polanco, is

stores for the products they need,” he says.

among those who believe the burden on Mexico’s public health management will only worsen. “At this point, public

Existing technologies and emerging applications that

healthcare services are unable to provide care to their

give patients greater control of their well-being also act

affiliates with their current budget and this situation will only

as bridges of communication between the patient and

worsen as chronic diseases become more prevalent,” he says.

the pharmacy, says Francisco Cantú, Director General of Fármacos Proasse. He says that apps can help remind

WHO recommends that governments around the world

patients when to take their medications and the information

increase prevention strategies to reduce health costs.

those patients feed into the system helps the pharmacy

Globally, WHO estimates that 35 million deaths occur each

know how advanced they are in their treatment. This would

year due to noncommunicable diseases. About 15.8 million,

allow a pharmacy “to contact patients and let them know

or 40 percent, are preventable, premature deaths from heart

when their prescription needs refilling. They could then

attacks, strokes, diabetes or asthma.

program the delivery of the medicine.” Clinical laboratories can play a key role in improving Perhaps the biggest change in the pharmacy landscape over

diagnoses while helping to create a prevention culture in

the past decade is the increase in pharmacy-adjacent clinics.

Mexico. “It is necessary to transform our healthcare system

According to the Ministry of Health, every month, more than

into one based on prevention. In this mission, clinical

10.6 million people in Mexico visit these clinics at a cost of

diagnostic laboratories, alongside genetic testing, can play a

between MX$20 (US$1.02) and MX$50 (US$2.54). Just 10

pivotal role,” José Carlos Pérez y Pérez, Executive President

years ago, there were 2,956 offices of this type. Today, there

of Grupo Diagnóstico Proa.

are 16,000 across the country. Laboratorio Médico Polanco’s Sicilia adds that a focus on But it is not just pharmacy chains. Retailers have also

prevention and early diagnosis can be a cost-efficient health

moved into the health space, helping to expand access

mechanism: “It is just a matter of running the numbers to

to care by taking advantage of the traffic through their

conclude that it is less expensive to prevent a disease than

stores and proximity to patients. Walmart of Mexico and

to provide care for the sick.”

INFOGRAPHIC |

PHARMACY AND SUPERMARKET OPPORTUNITIES TO IMPROVE HEALTHCARE According to COFEPRIS, more than 10.6 million people go

option for the Mexican population. Supermarkets are also

to pharmacy-adjacent clinics (PACs) every month. Today,

becoming an increasingly strong players in the health

there are more than 16,000 PACs throughout the country.

sector through in-house clinics and partnerships with large

Consultations at a price between MX$20 and MX$50 (US$1-

pharmacy chains, which opens the door to more competition

2.50) turned PACs into an accessible and popular health

in the pharmacy and medication distribution sector.

l Tota

pharmacies certifi ed

Certified

Non-certified

in pharmacies 80%

Ind ies epe % ndent pharmac 60

NATIONAL PERCENTAGE OF CERTIFIED PHARMACY-ADJACENT CLINICS (PACs) 2017

NUMBER OF PHARMACISTS AND PHARMACIES PER 10,000 INHABITANTS GLOBALLY 2018

Americas Europe Middle East Africa Southeast

C ha

25 %

% 40

In Mexico, 53 percent of the more than 28,000 pharmacies follow the PAC model

6 5

Asia

% 75

2 0%

Western Pacific

Global

average

Failing to give notice to authorities

No designated areas or interrogation and physical

of infectious-contagious diseases outbreaks

examination

3 2 1

No designated areas for storing clinical files

No functional sink

MAIN REASONS WHY PACs ARE NOT CERTIFIED IN MEXICO

No access for elderly or disabled patients

with soap and disposable towels

Pharmacists Pharmacies

Failing to offer public information about the doctor in charge of the clinic

TOP GLOBAL RETAIL COMPANIES BY REVENUE 2019 Company Walmart Stores Costco Wholesale Corporation

Dominant operational format

Number of countries of operation

Hypermarket/Supercenter/Superstore

Cash & Carry/Warehouse Club

The Kroger Co. Amazon.com Schwarz Group

Supermarket

Non-store

Discount Store

The Home Depot

Home Improvement

Walgreens Boots Alliance*

Drugstore/Pharmacy

Discount Store

Drugstore/Pharmacy

Hypermarket/Supercenter/Superstore

Aldi Einkauf GmbH & Co. oHG CVS Health Corporation* Tesco PLC

* Only two 100 percent health-related companies on the list

Sources: COFEPRIS, Deloitte, Statista, International Pharmaceutical Federation (FIP)

145

| VIEW FROM THE TOP

PRODUCT DIFFERENTIATION, AVAILABILITY AND DIGITALIZATION TO CONQUER MEXICAN MARKET MACEDONIO GARZA Director General of Farmacias Benavides

146

Q: How is Farmacias Benavides strengthening its

toward a model of health and primary medical attention.

presence in areas with insufficient health coverage?

This will allow us to become a point of reference for our

A: Our expansion process continues in markets where

clients. In addition to home delivery services, we are

we have not had a strong presence, primarily in the

remodeling our pharmacies to have a homogenous brand

central region of the country. Besides inaugurating new

presence.

locations, we are strengthening our brand presence with complementary services, such as home delivery and

Over the past 12 months, we converted and remodeled

primary medical attention, at points of sale. Over the

437 pharmacies. We have also taken advantage of the

past 12 months, we have opened 100 new business units

fact that we have access to all leading brands from the

in markets where we did not have a presence.

Walgreens Boots Alliance. In 2018, we introduced our generics brand ALMUS. So far, we have released 117

Q: How is Farmacias Benavides transforming its business

products through ALMUS and we expect to double

model to become not only a point of sale but of wellness?

that number in the coming 12 months. ALMUS is

A: We have created partnerships with players in the

already a reference in Europe and complies with all

digital arena and e-commerce platforms such as Rappi

international quality standards, which makes our offering

and Cornershop. We started collaborating with both

unique for those clients looking for alternatives to

companies in the first half of 2019 and our expectation

commercial brands.

is that these ventures will help us become more accessible to clients that demand digital purchases and

We are also introducing high-quality generic products

home delivery services. Improving medicine availability

through the Farmacias Benavides brand. We have

is among our main priorities, and it is a truly complex

73 Farmacias Benavides products, mostly focused

problem. In Mexico, recent studies show that a patient

on vitamins and medicines for acute conditions that

often needs to visit more than two pharmacies to fill a

complement the rest of our offering.

prescription. We have worked to ensure that Farmacias Benavides is the sales point where patients can find all

Q: How will you balance your operations between

their prescribed medications. We have made significant

digitally-driven solutions and traditional point-of-sale

investments to improve product availability at all our

operations?

locations by understanding consumer demand. We also

A: Many of our pharmacies are located in rural populations

are forming alliances with logistics experts to improve

and suburban regions where internet solutions do not

deliveries and to comply with customer expectations.

play a predominant role. Still, we continue working with both strategies to ensure we are as convenient as possible

Q: How are technological innovations impacting

for our consumers in markets where players like Rappi

Farmacias Benavidesâ&#x20AC;&#x2122; business?

and Cornershop are present, while maintaining a strong

A: We have been in the Mexican market for 102 years. We

customer-service approach in areas where clients favor

continue to strengthen our value proposition to stand

the traditional visit to the pharmacy.

out from the traditional transactional pharmacy, moving The market will evolve eventually but it is still early for us to declare a great digital transformation, especially Farmacias Benavides has over 100 years of experience and is

since most of our transactions are still done through

one of the largest pharmacy chains in Mexico. The company

the traditional pharmacy model. However, we remain

was acquired by Walgreens Boots Alliance in 2014 and has 1,174

attentive to changes in legislation that will permit the

points of sale in 24 states

use of electronic prescriptions.

Q: How is Farmacias Benavides’ business transformation impacting the country’s overall health ecosystem? A: We still see potential to grow organically in the Mexican market. A significant part of the market has been left unattended and we can offer an alternative in those markets where we are not present yet. On the other hand, we continue improving our value proposition through modernization and homogenous presentation of our brand. Our investment plan includes building an additional 100 pharmacy-adjacent medical offices, which is a fundamental convenience for our clients and patients. We offer medical consultations at around 50 percent of our locations, which means these new 100 offices will help us to complement our services. Q: What other partnerships or alliances is Farmacias Benavides developing to improve its operations? A: As members of the Walgreens Boots Alliance (WBA), we are exploring other complementary business alternatives with global WBA partners that we will eventually communicate and that are mainly aimed at increasing the available solutions in health and well-being. We also developed a partnership with FedEx, which we are in the process of deploying throughout the country. This alliance is intended to replicate our relationship with the company in the US, which allows patients to use our stores to send and receive packages nationally at convenient prices. In some cases, our locations are even more convenient than FedEx’s. This alliance is an important enabler because e-commerce players will be able to use Farmacias Benavides as a last-mile service to deliver their products. Farmacias Benavides is getting involved in financial services, as well. We are creating alliances with different players so clients can have the opportunity to pay for public services and make other types of financial transactions. We already have more than 200 available payments, which complements our value offering and increases the convenience of our locations at a national level. Q: What are Farmacias Benavides’ main three goals for 2019-2020? A: We want to continue with the incorporation of products of exclusive brands from the Walgreens Boots Alliance that might be attractive for the Mexican market. Our second goal would be to conclude the transformation of our sales points to ensure the same value proposition and physical appearance at all our locations. Finally, we want to become the reference point when it comes to filling prescriptions.

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| VIEW FROM THE TOP

REGIONAL SPECIALIZATION SECURES SUCCESS MIGUEL REYES General Manager of Farmacias Purex

148

Q: How relevant is the role of Mexican pharmacies in

Q: What mechanisms or strategies could the private and

providing quality pharmaceutical and health services?

public sectors implement to reduce medication sales on the

A: It is all about training and sharing knowledge on new

black market?

medications, new protocols and new information regarding

A: There is a need for mechanisms to verify the source of the

health conditions. We maintain good communication

medication, which must also be applied at a digital level for

and relationships with laboratories that study conditions

e-commerce. At the end of the day, consumers want to know

and develop new products. In our training programs for

that their medication is safe and comes from a well-regulated

employees, we ensure we are up to date with the newest

point of sale.

releases in the field. At the same time, we are implementing a service protocol that addresses all interactions between the

Q: How has your business strategy evolved in response to the

employee and the patient, including welcoming the customer,

growing number of e-commerce companies and startups?

asking their name, and even giving advice on savings they can

A: We do not have an e-commerce platform but we are

make with particular purchases. It is always about finding new

working on it. Platforms like Amazon are growing rapidly

openings to improve your service.

and other sectors, such as clothing and retail, have integrated them much faster. We are looking at a way to enter a

Q: How would you describe the general status of medicine

collaboration with delivery service Rappi. The company is

sales in Mexico?

strong in the food-delivery sector and it is already working

A: The market is very competitive. With chronic diseases like

with pharmacies, such as San Pablo. This kind of collaboration

diabetes on the rise, consumption also is increasing. Many

offers a great opportunity to reach our clients.

people are looking to treat and cure their conditions. Large chains, such as Benavides, Guadalajara and Ahorro, have many

Q: Which new services would you highlight as game-

points of sale in comparison with independent pharmacies

changers in the market?

with a more local reach. Every local pharmacy is competing

A: I think one of the important areas of interest is psychological

with a big national network. This is challenging because their

well-being. We know right now that the rhythm of life in big

volume of business can never reach that of large chains. We

cities can affect peopleâ&#x20AC;&#x2122;s mental health. This is an area where

are a medium-sized player with 40 points of sale and are

we can provide answers through consultations and follow-

pushing to compete with bigger players.

ups. Elements such as workplace pressures and fast-paced activities are related to conditions like gastritis and many

Big networks can maintain slightly lower prices for certain

mental issues. It would be good to have a program to guide

medications, with a difference of two or three pesos. But one

people, giving advice and working toward prevention.

of our main differentiators is our service and the quality of our people. Another is how we provide for the specific needs of

Q: What are Farmacias Purexâ&#x20AC;&#x2122;s main goals for 2019?

each patient. We always work to get the patient the particular

A: Our plan for the second half of 2019 is to open four or

medication they want. If we do not have it, we can order it.

five new pharmacies in Victoria, Tamaulipas and Piedras

Building a personal relationship and being there for them is

Negras, Coahuila. We are not moving to other regions. We

very important.

participate in a pharmacy association in which each chain has agreed to focus on a particular geographical zone and we have decided to respect the areas of other members. We are

Farmacias Purex has been in northeastern Mexico for over 50

present in Tamaulipas, Coahuila and Nuevo Leon. We also have

years. The company has a network of pharmacies in Nuevo

a pharmacy in Mexico City, but this for subrogation reasons.

Leon, Tamaulipas and Coahuila and is exploring the possibility

We also plan to remodel our pharmacies to create a pleasant

of developing a mobile app for delivery services

environment and to provide excellent service.

VIEW FROM THE TOP |

USING ELECTRONIC PLATFORMS TO BRING SERVICE TO NEW LEVEL GUILLERMO MARTORELL Director General of Grupo RFP

Q: Grupo RFP launched a digital platform for the

people in Mexico do not have access to banking services.

pharmaceutical sector. How is this platform performing?

We should be offering alternative payment methods

A: The platform is now in its trial period. Scotiabank initially

because not everything should be done with bank cards

authorized it and provided the opportunity. It was built

or cash. We are launching a project soon where we will

and administered by a company called We Company in

introduce a card that is not tied to a bank and offers credit

a strategic alliance with us. AXA, Santander and Banrural

to clients to buy medication. The service will be very simple.

have now joined too. The goal of the platform is to make

Patients will not have to wait for a bill or wonder what these

health services more efficient by allowing the patient

bills mean. You will be able to have insight into your credit,

electronic access to all kinds of services. The platform

and either have a debit or credit card model. People will

will include insurance agencies, diagnostic laboratories,

need to pay off the credit after a week, but they will not

doctors and a network of pharmacies. We have a project

have to consult banking services. This will help people get

mounted on the platform called AIRE (Smart Electronic

more access.

Recipe Management), which manages all these players in relation to our patient. As we advance, we will get more

Q: What are Grupo RFPâ&#x20AC;&#x2122;s top goals for 2019?

and more players involved. At least in the private sector, the

A: This year, we are looking to employ new resources to

whole country will be integrated. This will drastically reduce

regain organic growth. In terms of openings, we are not

the time between providing a diagnosis and handing the

finished with the consolidation processes we pursued

medication to the patient. This will have a positive impact on

last year and we hope to open new locations across the

both the quality and the costs of the service for the client.

country in 2019. We will be doing this in areas where we already operate and not in new areas. These areas are

Q: How is Grupo RFP working to increase its attractiveness

Bajio, Colima, Michoacan, San Luis Potosi, the metropolitan

in terms of electronic sales and delivery of medicines?

area of Mexico City, Puebla, Veracruz, Tabasco and

A: From a regulatory point of view, there are still certain

Chiapas. We are also working toward incorporating new

products that are controlled or specialized to such a

networks. At the moment, small groups of pharmacies

degree that they need to be administered by a person

around the country are suffering from competition

and cannot be bought on the internet. If you can receive

with larger groups. We can work together to provide

the required attention by a doctor through the cloud and

the benefits of economies of scale, and achieve higher

get an electronic recipe, then even these medications can

rentability. Ultimately, a certain type of acquisition will

be delivered to your house directly. The authorities will

have to happen. It is important for us to maintain a regional

ultimately have to give permission for this. To increase our

identity for these pharmacies. The back-office operations

own attractiveness, we want to provide a bigger service

are standardized for all pharmacies but the front-office

than just medicine delivery. It is important that we help

image should remain specific to the region. We are also

patients with orientation, providing them with the right

appealing to a sense of nostalgia and the relationship

information through the different phases of their treatment.

people have with their pharmacy. They are going to the

This is particularly relevant when it comes to chronic

pharmacy where their parents and grandparents went, and

diseases. It is also something which we continue to focus

where their kids will go in the future.

on at our pharmacies. Q: How is Grupo RFP helping to increase access to

Grupo Regional de Farmacias Productivas (RFP) is a group of

healthcare and medicine across the country?

pharmacy chains that includes Farmatodo, Nosarco, Farmacia

A: The majority of medication is still acquired through

de Dios, San Francisco de AsĂs, Santa Cruz, Farmacentro,

consultations with doctors and health professionals. Many

Union and G&M

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| VIEW FROM THE TOP

OMMNICHANEL STRATEGY INCREASES ACCESS TO HEALTHCARE RICARDO MARTÍ Commercial Director Pharmacy, Health and New Businesses of Walmart, Bodega Aurrera, Superama and Sam’s Club

150

Q: How does Walmex help increase access to healthcare?

represent savings of 20 to 80 percent. Walmart offers more

A: Our goal is to improve the quality of life of Mexican and

than medications; we offer everything related to health, from

Central American families. Walmex is operating in over 648

nutritious foodstuffs to exercise tools, which are often key

cities in six countries: Costa Rica, El Salvador, Guatemala,

to addressing obesity-related diseases that are increasingly

Honduras, Mexico and Nicaragua. Our infrastructure covers

common among the Mexican population.

the needs of 85 percent of the population of the regions where we operate and we made sure to be only 10 minutes

Q: How does Walmart guarantee the quality of the

away from our clients’ homes. Walmex receives over 5

medications it provides?

million clients per day, which provides a great opportunity

A: Our brand Medimart has become a reference point in

to increase access to health. Our strategy for the healthcare

the pharmaceutical industry. It covers a wide variety of

sector follows five pillars: growth, omnichannel, productivity,

products, from OTCs to specialized medications for many

agility and people & culture.

diseases. This brand follows strict quality guidelines from production to the moment medications are sold. We ensure

Our goal is that patients can access the medications they

that the labs that manufacture our brands adhere to all

need using the channel and payment method of their choice.

existing COFEPRIS regulations.

We are constantly innovating to open new sales channels for our clients and to develop end-to-end strategies that

Q: How does Walmex differentiate form other points of

ensure that the product is available as fast as possible. All

sale in the competitive generics market?

our decisions are focused on the patient. For us, speaking

A: Our differentiation is in our value proposition: making

about health means speaking about well-being, so we treat

health available to everyone. There is a Walmart 10 minutes

these topics together. We want our patients to perceive us

away from 85 percent of the population because our goal is

as experts in our field so they can trust us.

to be close to anyone who needs our products. Healthcare should not be linked to income. For that reason, we want

Q: What is Walmart’s approach to healthcare provision?

to offer a diverse portfolio of products that range in price

A: We approach access to health from different perspectives.

so everyone can afford them.

The first is physical access, which we handle through our over 2,400 points of sale in Mexico where we distribute OTC

Q: How is Walmex introducing new technological trends

analgesics, anti-flu agents and vitamins, among many others.

such as Big Data to improve its operations?

Of those stores, 1,370 also sell prescription medication

A: A trend we are seeing in the market is data mining as

and 340 have a doctor’s office. The second perspective is

the more information we have about patients, the better

economic. We all know that medicines are expensive due

service we can provide them. We are extremely careful in

to the high costs to research and develop new products.

our operations to ensure our client’s privacy is protected.

However, we try to negotiate better prices with laboratories

New technologies are increasing connectivity among systems

to be able to offer our clients the best available price. We also

and among people. Smart watches can communicate with

decided to develop our own brand of generic medications,

smartphones, which in turn can convey information to doctors

which are just as effective as patented medicines but

on the patient’s health. Doctors can analyze this information to make immediate decisions and recommendations to their patients. Technology is opening the door to many

Walmex (Walmart de México y Centroamérica) , part of

opportunities. We are seeing that pharmacies are increasingly

Walmart Inc., operates retail stores in 648 cities in Costa Rica,

developing an omnichannel strategy for sales to allow clients

El Salvador, Guatemala, Honduras, Mexico and Nicaragua. It

to buy their medicines in any way they prefer, either through

also has 26 distribution centers

apps, online or at stores.

INSIGHT |

SUPERMARKETS BECOMING KEY PLAYERS IN PHARMA MARKET Supermarkets are increasingly benefiting from their appeal as accessible shopping destinations to grow sales of pharmaceutical and healthy lifestyle products. “Supermarkets are naturally a one-stop destination where the whole family can find the products they need,” says Christian Vega, Commercial Vice President of HEB Mexico. Rather than take an extra trip to the pharmacy, shoppers can find all the products they need at the same place

“

We identify the best foods and superfoods and complement eating habits with vitamins and supplements to create a complete wellness lifestyle” Christian Vega, Commercial Vice President of HEB Mexico

they buy their weekly groceries, making supermarkets important players in the pharmaceutical sector. With presence in a number of Mexican cities, HEB has its own products and services in what it refers to as its ”Health

Another benefit that supermarkets may be able to

System.” This includes the same catalogue of medicines

offer is better prices. “Our generics catalog can save

that clients would find at conventional pharmacy chains,

customers up to 50 percent in terms of price.” The appeal

including specialized medicine.

of generics is particularly strong in Mexico, where many people prioritize price over quality or brand recognition.

To build a broader profile, HEB Health System also offers

Considering that supermarkets offer a more diversified

products such as dermatological cosmetics, nutritional

portfolio beyond the pharmaceutical area, they have

and sanitary products for babies and a range of products

more flexibility to offer discounts on pharmaceutical

for healthy living. Service is provided not by regular

products by dividing margins among different products.

supermarket staff but a team of in-house doctors, pharmaceutical professionals and lifestyle advisers who

Some pharmacies have the advantage of buying products

follow rigorous programs to be up to date in terms of

through their supply chain from producers who belong to

common diseases and treatments, according to Vega.

their own group. “We work to get better costs from our vendors to have a highly competitive price compared to

“HEB Health System even has optical services and a loyalty

other pharmacies, supermarkets or traditional medication

program for customers with chronic conditions. At the

distributors,” says Vega.

moment, HEB is the only supermarket that offers the seasonal flu shot in winter,” he says.

Supermarkets like HEB investing in teams of professional staff with expertise that goes beyond simple medical

Vega points at the healthy lifestyle segment as an

indications is likely to make these actors a stronger

opportunity to have an advantageous value proposition

force in the pharmaceutical market. Apart from having

over its competition. Supermarkets have greater access to

their own pharmaceutical products, supermarkets could

information on customer food and beverage preferences

also venture into potential partnerships with existing

and can adjust their products accordingly. “We identify

pharmacy chains. This would provide market expertise,

the best foods and superfoods and complement eating

improved purchasing strategies and name recognition,

habits with vitamins and supplements to create a

which are among the main advantages that supermarkets

complete wellness lifestyle,” says Vega. Personal care can

have over traditional medication retailers, as Vega

combine supplements, cosmetics products and food and

highlights.

beverages with customers’ wishes for natural ingredients with less or no added chemicals.

However, Vega points to the need for constant innovation and the importance of embracing new digital solutions

HEB is aiming to build a prevention mindset among its

to retain this advantageous position. “Our greatest

customers so they can develop a self-care attitude. Vega

challenges are to start working on new sales trends

points out that customers do not have to be sick to get

by adopting new technologies through omni-channel

advice from a health professional. Through its e-commerce

strategies, innovative projects within our stores and our

platform, the company hopes to anticipate sales trends

digital platform and the opening of our first supply center

and create an extra channel to reach its customers.

for e-commerce,” says Vega.

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| INSIGHT

DIGITALIZATION MAKES ITS WAY TO THE PHARMACY SECTOR

“

The industry is constantly evolving, which means we must either innovate or die” RAÚL CABALLERO, Director General of Farmacias Especializadas ProbeMedic

152

treatments online. This service is provided at a national level without additional cost, regardless of the product. To deliver its products, the company works with all major parcel delivery services. When dealing with hardto-reach areas, Caballero says “ProbeMedic always tries to have one of its collaborators deliver the product directly.” Infrastructure and climate conditions are two major challenges for home deliveries, but the company’s

Pharmacies and pharmaceutical suppliers in Mexico are

relationships with larger parcel services proves an

facing rapid changes. On the one hand, larger pharmacy

advantage.

chains are pushing out smaller independent branches. On the other, the digital marketplace is making consumers

Due to greater consumer consciousness of environmental

pickier in their product choices and how they want them

i s s u e s , P ro b e M e d i c h a s a l s o a d o p te d a m o re

to be delivered. “The industry is constantly evolving,

environmentally friendly stance, which has resulted in

which means we must either innovate or die,” says Raúl

adopting biodegradable packaging for a range of its

Caballero, Director General of Farmacias Especializadas

medications.

ProbeMedic (ProbeMedic). In the area of social responsibility, the company founded Aside from product diversity, customer demands have

a group called Socio Enfermerías to provide services

had a wider impact on companies like ProbeMedic.

to patients that go beyond medications. One group of

The company’s mission is to provide highly specialized

employees helps patients to prepare the paperwork

medical products that sometimes cannot be found at

needed for insurance companies, banks and hospitals.

regular sales points, including drugs, patented medicines,

Another area offers nutritional and psychological

medical equipment and supplies.

support. “One activity here is free yoga classes for people who suffer from cancer and multiples sclerosis,” says

ProbeMedic works with distributors, pharmacies, hospitals

Caballero.

and banks and has its own points of sale to sell directly to patients. The company started in 2011 with a strategy

From a commercial standpoint, ProbeMedic’s goal is

specifically focused on insurance agencies and banks,

to always continue growing, according to Caballero.

which still represent most of its operations. Eventually,

However, doing this by adopting technologies can

ProbeMedic broadened its services to hospitals and

increase access to health services. ProbeMedic’s strategy

its own points of sale. Today, it has nine locations, five

is also in line with the President López Obrador's

in Monterrey and the rest in Mexico City, Guadalajara,

administration’s plan to make healthcare more accessible

Puebla and Tijuana.

to the vast majority of the population. The challenge in the adoption of these technologies will be to maintain

Due to its specialized profile, ProbeMedic’s portfolio

the quality of service that traditionally comes through

could seem high-end but according to Caballero, the

personal contact between the healthcare professional

company maintains strong relationships with the country’s

and the patient.

most important laboratories to provide products at a competitive price.

Some companies are already trying to bridge this gap by offering video calls and chat services to connect

Customer service is another essential factor in staying

healthcare professionals with patients over large

competitive in an increasingly crowded market. Caballero

distances. However, it is precisely Mexico’s challenge

highlights ProbeMedic’s unique approach to patients as

of having a large remote population that is pushing

an advantage of being a family-owned business. The

technology forward. There is no doubt that private sector

company offers loyalty programs and other special offers

innovation will continue to play a role in transforming

and has developed technological solutions, including

healthcare, says Caballero. “The idea is to always benefit

an app that allows homebound patients to order their

the patient.”

VIEW FROM THE TOP |

ATTENTION, CLIENT SERVICE MAKE A DIFFERENCE FRANCISCO CANTÚ Director General of Fármacos Proasse

Q: How do you expect the traditional pharmacy model to

insurance companies in Mexico and we expect to keep

change as a result of technology and digitalization?

growing alongside these players over the next years. Our main

A: Technology will play a fundamental role because it

competitive advantage is that we are a company that is close

will help bring us closer to potential clients. We believe

to its clients and is always catering to their needs. We offer

the implementation of apps will be key, by helping us to

a differentiated service and provide a faster response to any

anticipate product demand more easily. This will help

request. In addition, our approach with clients is more direct.

us to adapt and provide better service, improving client satisfaction. Patients with chronic-degenerative diseases,

Q: How viable is it to have medicines with THC components in

diabetes or hypertension, in particular, could see a healthy

the Mexican market and will specialized pharmacies become

benefit because their medication does not change

the sales points for these medications?

over time.

A: We would have to analyze it just like any other medication. As with many other commercialized products, the main

We can easily use technology that is already available and

problem is the dependence that it might generate and its

adapt it so it becomes a useful tool for both the patient and

long-term effects. A well-regulated and supervised market

us. An example could be an app that consistently reminds

could be the ideal option for the commercialization of a

patients when to take their medications. Through these

product that is important and helpful for certain illnesses, such

reminders, patients would feed information into the app,

as epilepsy. These medications can have a positive impact but

letting us know how advanced they are in their treatment.

the market needs to be structured correctly.

At the same time, we would be able to contact patients and let them know when their prescription needs refilling. They

Although specialized pharmacies could be points of sale,

could then program the delivery of the medicine.

I believe these products should be commercialized as hospital products to ensure controlled distribution. However,

The information generated from the app could have several

this decision should come after a detailed analysis of the

uses, not only for us but also for insurance companies, which

risks the product might entail. Like any other medicine,

would greatly benefit from real-time information on patient

these products would need to be manufactured by a

behavior. For instance, a diabetic patient needs to follow

laboratory, guaranteeing that they comply with protocols

a rigorous and continuous treatment. It is in the insurance

and regulations.

company’s interest to help patients follow their treatment correctly, given that this lowers risks and potential costs.

Q: What are Fármacos Proasse’s goals for 2019 and 2020?

We could generate interesting synergies with insurance

A: We want to continue growing as a company. Besides

companies by finding elements that could motivate patients

Monterrey, we already have a pharmacy for local service in

to follow their treatment correctly.

Guadalajara and are expecting to open another one in Mexico City. We are analyzing the possibility of venturing into cities

Q: With which insurers does Fármacos Proasse work and

such as Mexicali, Hermosillo, Chihuahua, Merida or Torreon.

what are your expectations regarding these alliances?

However, before expanding anywhere, we need to consolidate

A: Our company is focused on providing services to

our position in Guadalajara and Mexico City.

insurance companies. It is a market niche in which we have always been, with these companies representing about 60 percent of our clients. The other 40 percent is made up of

Fármacos Proasse is a Mexican company dedicated to the

hospitals. These two niches are important for us and we

commercialization of highly-specialized medications, as well as

have generated alliances in both segments. In 2018 and 2019,

traditional pharmaceutical products. It distributes its products

we consolidated alliances with some of the most important

among hospitals, clinics, companies, individuals and pharmacies

153

| INSIGHT

TECHNOLOGICAL APPROACH ALSO BENEFITS THOSE WHO AVOID TECHNOLOGY EMILIANO HERNANDEZ LAOS Co-founder of Knaou

E-commerce is a fast and convenient alternative for buying

retirement homes. Now, it is looking to enter niche markets

almost anything, but online sales of medicine have yet to

with few specialists, such as infectiology and hematology.

catch on in Mexico. Emiliano Hernandez Laos, Co-founder of 154

Mexican pharmacy startup Knaou, believes change is on the

The company’s objective is to create loyalty among its

way thanks to technology. “Without a doubt, technology

client base. “Our alliances with doctors, pharmaceutical and

will change the Mexican pharmaceutical sector as it has

insurance companies help convince our clients to try our

changed other sectors such as retail.”

solutions. After that, our customer service and smart prices convince them to stay. Loyalty is essential for online sales.”

Hernandez Laos adds that new technologies can address

The challenge, Hernandez Laos says, is to attract patients

gaps in healthcare services, starting with a subscription-

to the platform. “The most important KPI in online sales is

based system like Knaou’s that facilitates medication

conversion, which measures the percentage of people that

delivery. “People do not want to leave their homes and

enter the page form the ones that actually buy in it. Pet

they do not want to spend time traveling to pharmacies or

stores have the highest conversion rate at 14 percent but the

other stores for the products they need,” he says.

conversion rate for online pharmacies is only 2 percent. Higher client loyalty means higher ROI on advertisement.”

Technological tools have significant potential in the healthcare sector that goes well beyond home delivery

Knaou hopes to improve the platform’s conversion rate in

of medicines. “Technology can impact every aspect of

2019, boosting it above every other online pharmacy. To

the health value chain. For example, it allows doctors to

do so, the company will focus on creating a personalized

remotely monitor their patient’s health and their adherence

experience for each chronic condition and implementing

to the medication. It also lets clients review and analyze the

state-of-the-art technologies. He adds that platform’s

characteristics of the medication they use to give better

simplicity is an advantage. “Patients fill in the registration

feedback to pharmaceutical companies.”

form just once or load it directly from one of the online prescription software programs in the market and then

Knaou operates as an online pharmacy selling a wide variety

receive their medication every month, which is more

of patented and generic medications from brands such as

convenient that buying it themselves when needed. This

Eli-Lilly, Johnson & Johnson, Sanofi, Beckman, Chinoin,

feature has proven popular with our clients.”

Novartis, Roche, Janssen and Pfizer. Its business model also aims to create lifelong links with patients. “We are using our

The company has 1,000 products on its webpage but if

platform to provide a better service to chronic patients with

patients do not find the medication they need in the catalog,

high-ticket conditions like osteoporosis, cancer and geriatric

the company can often find it for them since it has access

needs. Platforms like ours permit closer monitoring of the

to over 20,000 products. Knaou’s portfolio was created

patient and allow us to offer a personalized service that

through alliances with distributors but it wants to go a step

caters to the patient’s preferences,” says Hernandez Laos.

further and work directly with pharmaceutical companies and target specific conditions. Although Knaou works mainly

Knaou’s subscription system automatically monitors and

with geriatric institutions and private firms, the company has

delivers medications to patients. Hernandez Laos explains

ambitious expansion plans. The startup wants to continue

that patients, or their relatives, can simply upload their

investing in technology and in software development.

prescriptions and the system will automatically calculate

“Although we do have great prices, we are not a discount

the amount of medication the patient needs per month and

pharmacy. Our value proposition is based on technology and

deliver it a couple of days before the previous batch runs

customer care. We are collaborating with allies like Prescrypto

out. Knaou began operations in January 2019 working with

to eventually offer a fully digital ecosystem.”

VIEW FROM THE TOP |

LAB EYES NATIONWIDE EXPANSION JOSÉ CARLOS PÉREZ Y PÉREZ Executive President of Grupo Diagnóstico Proa

Q: How did Grupo Diagnóstico Proa’s business strategy

Q: Temasek and LIV Capital acquired 32 percent of Grupo

evolve to make it one of the largest players among clinical

Diagnóstico Proa’s assets. What does this acquisition mean

laboratories?

for the company’s growth and local operations?

A: Laboratorio Médico del Chopo, which would later

A: Among 25 venture capital firms, we chose those that

become Grupo Diagnóstico Proa, turned 70 in September

best understood Grupo Diagnóstico Proa’s long-term plan:

2018. The company grew under three pillars: placing

to expand throughout Mexico. We predict that the market

patients and their doctors at the center of its business

will eventually consolidate into six to eight large players

strategy, bringing services closer to the patient’s home

based on economies of scale, instead of the over 9,000

and providing accessible prices. We started as a single

small laboratories that exist now. The alliance with Temasek

laboratory and now we have over 280 franchises.

and LIV Capital will give us the capital to continue growing and expand our reach to the rest of the country. If the

From the start, the laboratory’s goal was to be a one-

conditions are right, Grupo Diagnóstico Proa will launch

stop service provider for the most common tests required

an IPO. We plan to continue opening offices in the states

by doctors to save patients the need to visit multiple

where we currently have no presence, preferably through

locations. The laboratory also incorporated radiology

an association or the acquisition a local laboratory chain.

services. Rather than expand the existing location, we

But if this is not possible, we are always prepared to open

opened different branches to be closer to patients’ homes.

a new branch.

Q: What role does Grupo Diagnóstico Proa play in

Q: What new services is the group developing to address

Mexico’s healthcare system and in increasing access to

Mexico’s changing medical needs?

healthcare?

A: From the start, Grupo Diagnóstico Proa focused on

A: We have two clients: doctors and patients. The first

diabetics. First with glucose tests; then the glucose

are those who request the tests and the second are those

tolerance curve, which requires the introduction of

who require them. Doctors diagnose and interpret the

glucose and measuring its digestion hourly, and lastly with

tests and we are the physician’s partners throughout the

hemoglobin glycosylate tests. This last one allows more

entire treatment. We are constantly organizing events

precise monitoring of blood glucose. We also have a 72-hour

and training sessions for doctors. We also have medical

blood test, which connects a small monitor that continuously

representatives who visit doctors on a monthly basis to

measures the patient’s blood glucose over three days.

collect their questions and to provide them with more information on existing tests.

The group has strong capabilities in diagnostics and radiology, for which we are the largest group in Mexico

Providing healthcare for all Mexicans is a challenge so big

with over 1,160 assets such as 27 MRI systems, 57 computed

that it can only be addressed through joint efforts from

tomographers, 3 PET/CT, 183 ultrasounds, 182 general XR

all healthcare players. Our healthcare system is based on

equipment, 82 mammography equipment and more than

curing diseases instead of maintaining health through

600 other multi-purpose systems including densitometry,

prevention. It is necessary for the public and private sectors

cardiology and colposcopy.

to jointly develop a platform that allows the exchange of information, for instance through an electronic clinical file. Allowing individuals to have access through the cloud to

Grupo Diagnóstico Proa , founded in 1948, owns several

all their medical data and to bring it to any institution the

diagnostics chains, including Laboratorio Médico del Chopo,

patient desires will allow care providers to increase the

Imagenus, Care Diagnostics and Acceso Salud. The group has

reach of their services and provide care to more people.

over 3,500 employees

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| VIEW FROM THE TOP

PREVENTION BENEFITS PATIENTS, LABORATORIES AND THE HEALTHCARE SYSTEM MARIO SICILIA Director General of Laboratorio Médico Polanco

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Q: How does Laboratorio Médico Polanco (LMP)

government from MX$3,000 (US$158) to MX$5,000 (US$263)

differentiate itself from other laboratories that offer

per year. Treating a stage 3 diabetic costs the government

similar services?

MX$380,000 (US$19,195) per year. Prevention strategies can

A: Most laboratories offer a similar portfolio of tests.

result in great savings and they should be prioritized in the

Differentiation is mostly achieved through branding and

following years, resulting in significant market growth.

franchise location. Most patients do not see quality as a differentiator as they believe tests from different laboratories

Q: What role should prevention take in the development of

will give equal results. Some labs have differentiated

sustainable strategies for the healthcare system?

themselves by offering lower prices due to their high volume

A: Prevention should be key in the government’s strategy

of samples. Others have found differentiation by presenting

to treat diseases. While COFEPRIS, under former Minister

themselves as premium services, mainly relying on customer

of Health Mikel Arriola, began implementing prevention

experience. While we do offer groups of tests to identify

strategies to control healthcare costs in the long term, these

specific diseases or for different segments of the population,

policies have now changed because their results are neither

these have not yet worked as a differentiator. Our main

immediate nor easy to observe.

opportunity will be the introduction of many innovative tests being developed in other countries, which have allowed for

In Nuevo Leon, the previous administration created a program

prevention strategies for certain diseases, including diabetes,

where IMSS contributions would be reduced if employees

obesity, hypertension and cancer. We are also selling testing

subscribed to prevention programs. The objective of this

services to hospitals through referrals and in this segment,

program was for institutions to develop their own prevention

quality is an important differentiator. The quality of our tests

strategy to reduce the incidence of future diseases, especially

is supported by the College of American Pathologies.

diabetes, obesity, hypertension and some types of cancer. Agreements of this type will bring significant benefits to the

Our differentiator should be innovation but there is still a long

public sector and to diagnostics laboratories but they have

way to go to achieve this. There are two ways to innovate. The

not been popular because their results were not easy to see.

first is through the type of tests that a lab can offer to the market. The second is through the way laboratories interact

Q: How can the clinical laboratory industry grow in terms

with the patient, for instance by delivering results at home

of presence and volume of tests?

or allowing their doctors easy access to the patient’s results.

A: The clinical laboratory sector in Mexico is worth about MX$30 billion (US$1.57 billion), not including the expenses of

Q: How is LMP investing in state-of-the-art technology to

the public sector. About a third of these services are provided

improve healthcare outcomes?

by hospitals and the rest through the many franchises of clinical

A: Our laboratories are an intermediary between technology

laboratories. The industry has two significant opportunities for

and patients. LMP, for instance, has exclusivity for a diabetes

growth: coverage and density. There are many areas in Mexico

test that allows us to diagnose prediabetes. We are investing in

that still do not have access to qualified clinical laboratories.

a wide variety of solutions that result in high ROIC for patients

It is also necessary to develop and enforce regulation that

and institutions. For example, treating a prediabetic costs the

holds clinical laboratories to higher standards of quality. Poor clinical studies may mislead doctors and patients and cause diseases to go unattended for longer periods, leading to

Laboratorio Médico Polanco has 29 years of experience

medical complications that can increase the overall cost of

providing

portfolio

treatment. Blood tests are much more standard, but they do

now includes clinical analysis, parasitology, immunology,

require certified processing centers that follow best practices

hematology, microbiology, clinical chemistry and cytology

to ensure reliability of test results.

laboratory

and

X-ray

services.

Its

VIEW FROM THE TOP |

REGIONAL EXPERIENCE PROVIDES ADVANTAGEOUS POSITION María de la Paz Director General of Laboratorios Clínicos de Mérida

Daniel Duarte General Manager of Laboratorios Clínicos de Mérida

Q: What strategies have you implemented to differentiate

Q: How do you deal with growing competition in the

from other laboratories?

Yucatan area?

DD: We have gained significant experience since we opened

DD: Many large laboratories have operations in this region,

in 1975. We were the first to start using automation and

such as Laboratorio Médico Polanco, Laboratorio Medico

implemented a special system for clinical laboratories.

del Chopo, Salud Digna and Star Médica. To remain

These steps, and retaining people who are excellent at what

competitive, we must be 100 percent reliable. We always

they do, have helped us grow. Our main differentiator is the

run quality-control tests before running client tests. Time

quality of service offered by our personnel to every patient.

efficiency is also a huge advantage we can offer. All our operations are in the region, so we do not have to send

Q: Why did the company choose to offer testing at home?

things to other places in the country.

MP: At-home testing has an obvious benefit for those who are less mobile, such as the elderly and those who have

We have been in Yucatan for a long time and that has

recently had surgery or have been in an accident. However,

allowed us to build many local relationships. However, if

many people have started requesting to have their blood

a competitor can offer a better service for a lower price,

taken at home instead of the laboratory despite not being

then obviously clients will go to them. Therefore, we must

impaired in any way. We schedule an appointment and

always continue to strengthen our operations and reach out

always ensure we send someone who is experienced in the

to potential clients. Our plan is to contact local universities

required procedure. After taking the sample, we run tests

and demonstrate who we are and what we do. As a result,

at the laboratory and then provide the results by email.

doctors graduating from university will know our brand. In terms of service, we always aim to provide a pleasant

Q: Where do most of your patients come from?

experience. This means tests should be carried out with

Are they private or have they been referred by an

little waiting time and those running the test should always

insurance company?

have an ear to listen to the patient so they feel cared for.

DD: Our client base is highly diversified. About 50 percent of our clients come from companies with which we

Q: How does Laboratorios Clínicos de Mérida contribute

have agreements. This includes insurance agencies and

to strengthening prevention strategies?

manufacturers. Our main insurance partner is AXA, but

DD: We have been doing campaigns for many years now,

we work with all companies. The other 50 percent of our

targeting men, women and the elderly. The goal is to detect

client portfolio includes people who know us or have been

diseases at an early stage. There has to be a change in

recommended by doctors.

mindset so people undergo checkups before they actually have symptoms. At least once a year, we organize public

Q: What strategies are helping you to grow your

activities where we talk about particular diseases and

client base?

conditions. We also work with the Red Cross to provide

MP: On the clinical side, we are introducing new

tests at very low fees. Ultimately, prevention and early

types of equipment and tests, including ultrasound,

detection are far better options for people, not just in terms

X-rays, spirometry and electrocardiograms. These new

of health but costs of treatment, too.

technologies also allow us to be more of a diagnostics center as opposed to just a clinical laboratory. In terms of reaching the general public, we advertise in places where

Laboratorios Clínicos de Mérida offers its services to individual

we expect to find potential clients. We have also visited

clients, insurers and other companies. It participates in several

colleges and associations where doctors come to us and

health checkup campaigns and works with foundations such as

talk about what we offer.

FundHepa and the Red Cross

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| INSIGHT

SUCCESS IS ALL ABOUT QUALITY NOT QUANTITY

“ 158

Public policy is limited. You can promote clinical testing for the population but public chains are not necessarily going to offer testing that is trustworthy and of high quality” Oswaldo Basto, Medical Director of Quimialab

Some large pharmacy chains also provide services in clinical analysis but I do not consider them high-quality alternatives.” Quality in medical laboratories becomes even more relevant considering the high-profile Merida has been cultivating in terms of medical services. High-tech medical services, as well as advanced medical treatments offered in the region have helped in the creation of a medical tourism industry, which creates more opportunities to reach new clients, according to Basto. “People come from Tabasco, Campeche and even Belize to get treated at Hospital Faro del Mayab and Clínica Mérida,” he says. Medical tourism has helped Quimialab to grow its client

Growth in the Merida area has led to an increase in

portfolio, but Basto says the company has a strong

medical laboratory offerings and related services in the

focus on private clients and is trying to venture into

region. This has forced local players to compete with

the corporate and institutional arena. “Penetrating this

larger laboratory chains, says Oswaldo Basto, Medical

market is not necessarily easy. We have to find the best

Director of Quimialab. “Growth in Merida has attracted

communication channels. Many companies see laboratory

laboratories from the center of the country, such as

analysis for their employees as a significant investment.”

Laboratorio Médico Polanco and Laboratorio Médico del Chopo.”

Every client has different needs, which is why Quimialab has made significant efforts to diversify its portfolio. “Our

Quimialab, a laboratory for clinical analysis based in

clients range from an antidoping agency to a security

Merida that offers services to individual clients and

company. Right now, we only work with small companies.

companies, is making personalized service its key

We are trying to target larger players and manufacturers

differentiator against new competitors entering the

with local presence and more than 200 employees, like

market. “Service is the most important factor and it must

Bimbo, Pepsico and La Costeña.”

be personalized for every client. All companies can do the same in terms of promotions and pricing, but the care

While Quimialab has a strong foothold in the local market

and attention we offer is unique,” says Basto.

providing laboratory services to different segments of the population, Basto says the industry still needs more

Given its local reach, Basto says Quimialab has created

coordinated efforts to guarantee access to quality

a strong bond with the local community, which has

healthcare in early diagnosis and prevention. “Public

helped the company in terms of recommendations. “Our

policy is limited. You can promote clinical testing for

reputation has spread through word of mouth and we

the population but public chains are not necessarily

are often recommended by locals.” Even though the

going to offer testing that is trustworthy and of high

arrival of new players spurs competition in the local

quality.” An example of this situation is that there are no

market, Quimialab is not focusing entirely on competing

specific efforts to support labs to meet quality standards,

with large chains. “We do not necessarily see them as

Basto adds.

competition because they are still setting up operations in the region. These laboratories are well-known in central

Still, Basto remains confident about Quimialab’s

Mexico but not here. Having said that, their reputation

capabilities and continues working on generating growth

increases as more people migrate to the southeast.”

for the coming years through alliances. “We will build our brand through various platforms to reach as many

Regardless of their popularity, Basto says that quality is a

customers as possible. We are working on agreements

decisive factor in terms of competition. “We are certified

with insurance agency Allianz, the American travel

by PACAL and have our own internal certifications.

company Quality Travel and the Mexico City-based

We only use reagents of the highest quality, as well.

company Telemédico.”

VIEW FROM THE TOP |

STRENGTH IN A DIVERSIFIED PORTFOLIO RAÚL SOLÍS Administrative Director of Laboratorios Diagnóstica

Q: What strategies have you implemented to remain a

We have advanced equipment for conducting highly reliable

leader in clinical analysis in southern Mexico?

tests. One of these is Atellica, made by Siemens, but our

A: We are regulated by various quality standards, including

equipment comes mainly from European suppliers.

ISO 9000. We constantly search for ways to improve, both

159

from a clinical and administrative perspective. We are based

Tests must be precise to reduce the amount of active

in Villahermosa but our services reach the whole central and

ingredient wasted. Small laboratories that do not have access

southern region of the country. We are active in Tabasco,

to this equipment need to have large volumes of samples to

Campeche, Quintana Roo, Yucatan, Chiapas and part of

make their operations efficient. Without a certain number of

Veracruz. We are not physically present in all these states

patients, you have to throw your active ingredient away.

with a laboratory of our own but we work with various local laboratories. Our testing facilities are in Villahermosa,

Q: How are innovations in technology and artificial

Merida and Queretaro. In Mexico City, we are in negotiations

intelligence impacting laboratory operations?

to offer our services to a hospital and we have a presence

A: Advanced analytical testing equipment like ours allows

in Guadalajara but under a different name, also carrying

us to test and gain the precise information that doctors

out the administrative management of a laboratory there.

need. They also generate large amounts of data that provide

We are also looking at potential opportunities in the north.

new insights into a patient’s health. Knowing where patients come from and what tests they undertake is also useful in

Our main differentiator is service. Anyone can compete in

determining what next steps we should take to grow our

terms of price. We want to offer a high-speed service, so

business across the region.

people with urgent situations can be helped quickly. We also have advanced equipment for accurate and rapid testing.

Generally, service operations have become much more dependent on digital platforms. Our website has been

Q: What is your most popular service from your biochemical

updated over the last two years and is now a portal for

and immunological analysis and genetic testing portfolios?

accessing test results. However, we have also been looking

A: Generally, routine packages of complete checkups are

at possibly sharing test results with clients through

the most common. These include a number of biometric

alternative digital platforms, such as WhatsApp.

indicators. You do not have to be sick to take these tests. We also offer specialized testing and if other laboratories do not

Q: How do you think laboratories can participate in

have the required equipment, they ask us to conduct their

prevention strategies?

tests. We offer DNA tests for example. We have a specific

A: Doctors recognized the importance of testing for early

test where blood is taken and we can determine the patient’s

detection but were not walking the walk. People in general

ancestry. People can find out what parts of the world they

find it unnecessary. In Mexico and Latin America, the culture

come from. This test is quite popular and can also be used

of selfcare is lacking. People think they are all going to be fine

as an indicator of genetic predisposition to certain diseases.

and grow old, so they do not even contract insurance. You do not have to be sick to go to a laboratory and have a checkup.

Q: How did you become a service provider for smaller

Prevention is always the better option.

laboratories? A: We started operations in 1993 by working with a clinic in Villahermosa. Doctors were helpful in providing feedback on

Laboratorios Diagnóstica is based in Villahermosa, with

our operations, which was ideal, considering we were new

laboratories for clinical analysis also in Merida and Queretaro.

to the health sector. As we grew, we established our own

Besides conducting tests for its own clients, the company also

laboratories and began to explore collaborations with others.

serves other labs

Supermarket pharmacy

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ROUNDTABLE | New sales channels for medications like retail stores and online platforms are forcing traditional pharmacies to innovate to stand out and maintain their market share. This phenomenon is also leading new entrants to take an increasingly important and comprehensive role in healthcare, boosted by doctors at pharmacy-adjacent clinics available for consultations and to prescribe medications. Mexico Health Review spoke with pharmacies and retail leaders to understand how their companies are differentiating from other points of sale and innovating in

HOW IS YOUR COMPANY REVOLUTIONIZING MEDICATION DISTRIBUTION?

providing care.

Our infrastructure covers the needs of 85 percent of the population in the regions

161

where we operate. We have made sure to be only 10 minutes away from our clients’ homes. Walmex receives over 5 million clients per day, which provides a great opportunity to increase access to health. Our strategy for the healthcare sector follows five pillars: growth, omnichannel, productivity, agility and people’s culture. We are constantly innovating to open new sales channels for our clients and to develop end-to-end strategies that ensure that the product is available as fast as possible. All our decisions are focused on the patient. For us, speaking about health means speaking about well-being, so we treat these topics together. We want our patients to perceive us as experts in our field so they can trust us.

RICARDO MARTÍ Commercial Director Pharmacy, Health and New Businesses of Walmart, Bodega Aurrera, Superama and Sam’s Club

We have created partnerships with players in the digital arena and e-commerce platforms such as Rappi and Cornershop. We started collaborating with both companies in the first half of 2019 and our expectation is that these ventures will help us become more accessible to clients that demand digital purchases and homedelivery services. Improving medicine availability is among our main priorities and it is a truly complex problem. In Mexico, recent studies show that a patient often needs to visit more than two pharmacies to fill a prescription. We have worked to ensure that Farmacias Benavides is the sales point where patients can find all their prescribed medications. We have made significant investments to improve product availability at

MACEDONIO GARZA Director General of Farmacias Benavides

all our locations by understanding consumer demand. We also are forming alliances with logistics experts to improve deliveries and to comply with customer expectations.

Many people in Mexico do not have access to banking services. We should be offering alternative payment methods because not every transaction should be done with bank cards or cash. We are launching a project soon where we will introduce a card that is not tied to a bank and offers credit to clients to buy medication. The service will be very simple. Patients will be able to have insight into their credit and either have a debit or credit card model. People will need to pay off the credit after a week, but they will not have to use banking services. This will help people get more access.

GUILLERMO MARTORELL Director General of Grupo RFP

LEI Libra labeling machine

MANUFACTURING & SERVICE PROVIDERS

The elimination of a requirement that forced foreign drug manufacturers to build a plant in Mexico if they wanted to sell to the local market and the adoption of generics gave local manufacturers room for growth. International companies still see Mexico as an attractive manufacturing destination thanks to its low-cost labor and strict regulations. The pharmaceutical manufacturing sector has grown at an accelerated pace but challenges in recent years led to a gradual reduction in medication production. Companies face the constant challenge of improving and validating best practices, which are of the utmost importance to remain competitive in the business and an obligation for those that aspire to have a worldwide presence.

Manufacturing and Service Providers analyzes local capabilities for medication production in the country. Through the voice of supply chain participants in the medical devices and pharmaceutical sectors, this chapter discusses the challenges these companies face and how they influence other industrial sectors.

163

CHAPTER 8: MANUFACTURING & SERVICE PROVIDERS

166

INSIGHT: Philippe Fournet-Fayard, Eolis América Latina

167

VIEW FROM THE TOP: Gerardo Torres-Saptien, Grupo Rasch

168

VIEW FROM THE TOP: Madjid Quali, Vaisala México and

Vaisala Industrial Measurements Division

169

VIEW FROM THE TOP: Jaime Cervantes, Vitalmex

170

VIEW FROM THE TOP: Héctor Tijerina, SELCI

171

VIEW FROM THE TOP: Nadia Rodríguez, Malvern Panalytical

172

PROJECT SPOTLIGHT: Getinge: Reinforcing High‑Quality Education

174

VIEW FROM THE TOP: Franklin Feller, Valtria Engineering

175

VIEW FROM THE TOP: Pablo Pérez Gay, Rossbach México

176

VIEW FROM THE TOP: Ander Gentry, Gamma Biolabs

177

VIEW FROM THE TOP: Jorge Faugier, Indukern México

178

VIEW FROM THE TOP: César Rodarte, ARQmedyca

179

VIEW FROM THE TOP: Miguel Velázquez, Grupo Empresarial MDF

180

VIEW FROM THE TOP: Patricia Zurita, Eurotrials, a CTI Company

181

VIEW FROM THE TOP: Enrique Garza, CAPSU-GAMA

182

VIEW FROM THE TOP: Alonzo Autrey, DVA Mexicana

183

VIEW FROM THE TOP: Anil Andrade, ACG Group

184

VIEW FROM THE TOP: Melissa Rosales, RM Pharma

185

INSIGHT: Karen Hahn, ICON

186

VIEW FROM THE TOP: Arturo Rodríguez, INFINITE

187

VIEW FROM THE TOP: José Luis Jacques, Lavartex

165

| INSIGHT

TECHNOLOGY MANAGEMENT CAN TURN SPENDING INTO INVESTMENT PHILIPPE FOURNET-FAYARD CEO and General Manager of Eolis América Latina

166

Many companies see technology as an expense and

health-related facilities. “Pharmaceutical companies have

not an investment, which makes them minimize its

implemented these systems the most, but in recent years

importance. “Unlike other expenses companies make,

other segments, such as hospitals and laboratories, are

technology is usually seen as unnecessary or postponable

becoming interested in well-designed HVAC systems,”

unless there is an immediate flaw that must be corrected,”

says Fournet-Fayard.

says Philippe Fournet-Fayard, CEO and General Manager of Eolis América Latina.

The main reason, according to ASHE Health Facilities, is that these systems help control hygiene and temperature

The difference between technology being an expense or

systems that are key in the health sector, in addition to

an investment lies in how the company manages its IT and

reducing energy consumption. “Hospitals are interested

IT budget. Eolis América Latina, an air treatment systems

in reducing nosocomial diseases. Meanwhile, laboratories

specialist for industrial processes, believes investing in

want to ensure their tests are not contaminated or

environmental control systems contributes to generating

altered,” says Fournet-Fayard.

greater productivity and safety in products and operations. “Expenditures that result in improvements

To maximize the benefits of HVAC systems, it is critical

are always solid investments,” says Fournet-Fayard.

to choose the correct one according to the needs of the company. “No company is the same; it is important to

Technology budgets, according to Deloitte, can lead

have customized technology that is consistent with the

companies from value preservation to value creation

company’s size, location, climate and even goals in terms

by driving business growth and operational efficiencies.

of production and energy efficiency,” says Fournet-Fayard.

However, greater spending on technology does not

Characterizing these variables can be the difference

necessarily translate into greater value creation.

between wasting resources and making a good investment.

Fournet-Fayard says that rather than investing in the

“For example, if the purpose of the system is to control

latest technology, companies must look for systems that

nosocomial infections, metrics to analyze should be the

improve results, delivery times and processes. Within the

number of infections and its main drivers,” he says.

different technological areas in which pharmaceutical companies can invest, HVAC systems are among the

To choose the best technology, a company requires the

most important.

help of an expert who knows the systems and the needs of the companies in the sector. Eolis América Latina’s 50

HVAC systems, according to the World Health

years of experience and a highly qualified work team can

Organization (WHO), play a key role in preventing

offer that. “Over the years, we have remained industry

contamination, cross-contamination and other critical

leaders because we know how to build solutions for

aspects that pharmaceuticals should consider while

each client, not only in health but in textile and industrial

manufacturing drugs. “What can be measured, can be

facilities as well,” says Fournet-Fayard.

improved. By having better control of the environment surrounding a pharmaceutical production, the company

Eolis América Latina’s goals are focused on creating

is investing not only in technology but efficiency and

solutions that include a combination of great technology

product safety,” says Fournet-Fayard.

and experienced professionals. The best way to do that is through the workforce, according to Fournet-Fayard.

E nv i ro n m e n t a l c o n t ro l i s n o t o n l y u s e f u l f o r

“We already have state-of-the-art technology, so Eolis

pharmaceutical companies. Temperature, humidity and

América Latina will keep betting on training its people to

air movement management can be used to optimize other

maximize value and reliability for our customers,” he says.

VIEW FROM THE TOP |

QUALITY HEALTHCARE MEANS CLEAN HEALTHCARE GERARDO TORRES-SAPTIEN General Manager of Grupo Rasch

Q: How important is pharma in your operations and how

still dying from infections. We provide special services

have you grown your position in this market?

to battle biocontamination and prevent this, which

A: About 85 percent of our business is geared toward

could also help hospitals save millions by implementing

pharma and it is the industry that has helped us reach

our system. 167

our current market position. First, we introduced process equipment and gradually, demand grew for more diverse

Q: How committed has the public sector been in terms of

products and services. We also realized there was a need

increasing quality in hospitals?

to provide our staff with specialized technical training.

A: Some private hospitals have invested significantly in

We have a system of certifications that, besides helping

creating safe working environments but the problem is

our staff provide a better service, generated loyalty and

still considerable in the public sector. The government

a sense of commitment among our people. Our goal is to

is focused on increasing accessibility to medication and

provide a highly professional service, while maintaining a

treatment but it should also invest in making hospitals safer.

personal and effective connection between our employees

We are concerned about the distribution of resources in

and our clients.

hospitals, especially since there is no door to knock on to offer technological innovation due to misconceived financial

Q: Of the different services and equipment you provide, which is most in demand? A: We were pioneers in Mexico in providing clean rooms as a prefabricated module, which opened a whole new market niche. We design these in Europe through our alliance with Belgium’s Clean Room Consulting Engineering. However, our operations in Mexico are run by Mexican engineers and adapted specifically for Mexican and Latin American clients. We offer packages for clean room solutions with

priorities.

Grupo Rasch designs prefabricated clean room modules in partnership with Belgium’s Clean Room Consulting Engineering

different specifications but all of them have the same level of quality. Our punches division is also an attractive and

Q: What are your growth expectations and main goals

unique selection in our portfolio.

for 2020? A: We want to maintain steady growth and to develop our

Q: What opportunities do you see to grow your presence

staff’s capabilities. We also want to explore new markets

in the market?

where our solutions can offer an added value. This includes

A: There are is a big difference between laboratories and

increasing our exports, which are still small. Regarding

hospitals. Mexican laboratories have the highest standards

our other business verticals, there have been limitations

in the world and in fact, Europeans and Americans coming

in some of them. In the automotive industry, for example,

to visit them are often impressed by how advanced they are.

only big companies are investing in new plants at the

The hospital field, however, still faces significant challenges

moment. However, these processes are cyclical and new

in terms of standardization. Providing good healthcare

opportunities will always come up.

cannot be just about providing medication and treatment; there needs to be a complete system controlled within a safe environment.

Grupo Rasch helps health companies ensure the efficiency of quality management systems. Its services include sales of

Hospitals in Mexico are regulated but guidelines are not

European machinery, preventive and corrective maintenance,

as strict as on the laboratories and many people are

sale of spare parts and clean-room services

| VIEW FROM THE TOP

ACCURATE MEASUREMENT MEANS HIGH-QUALITY PRODUCTS MADJID QUALI Country Manager of Vaisala MĂŠxico and LAM Regional Director of Vaisala Industrial Measurements Division

168

Q: How is Vaisala positioned in the Mexican market and

Q: What companies will benefit from Vaisala's radio

what type of customer does it usually work with?

frequency communication network VaiNet?

A: The life sciences sector has been one of our focuses

A: Vaisala started its business in Continuous Monitoring

globally since the beginning of our controlled environment

Systems (CMS) when we acquired the logger company Veritec

business, and Mexico is no exception. Vaisala specializes in

Instruments in 2010, and with this purchase made a decisive

developing products for improving safety, efficiency and

move into the CMS business. Since then, we have invested

decision-making through environmental measurements

heavily in improving the view link offering, and in developing

and related services. The industry here maintains high

new products for the CMS line. One of our launches is our

standards with strong regulations, which means Vaisala

own RF communication network called VaiNet to allow

has a lot of added value to provide. Both international and

unprecedented ranges (over 100m) in wireless communication

national companies have been our clients in Mexico for a

over a private sensor network. A typical installation would

long time. Our well-known brand provides unique solutions

be monitoring temperature and humidity in a manufacturing

in all segments of the life science sector.

facility or storage area for pharmaceutical products or medical devices. This data can then also be used by a regulatory

Q: How does Vaisalaâ&#x20AC;&#x2122; s offering add value to its clients?

authority to validate that conditions set out in the norms are

A: Our typical customers manufacture, store or distribute

being met.

expensive assets that are sensitive to environmental conditions, such as temperature, humidity and pressure.

Q: How would Vaisala describe the state of measurement

Our products and systems offer ways to measure these

solutions in Mexicoâ&#x20AC;&#x2122;s health sector?

conditions and control them with a high degree of accuracy

A: A country with a large population and a geographical

and reliability. In addition, they are easy to use and provide

location near the largest market in the world is an attractive

a beneficial cost of ownership. These factors are crucial in a

place for many pharmaceutical companies. Therefore, it is

technology-dense and highly-regulated industry.

not a surprise to see Mexico hosting almost all of the largest pharmaceuticals in the world. A great deal of effort has gone

Vaisala has pioneered innovative measurement solutions

into improving local processes as local regulations have

for over 80 years. We started in weather measurement

become more rigorous and export has many requirements.

when our founder, Vilho Vaisala, invented the operating

However, significant investments need to be made for more

principles of radiosonde technology for high-altitude

accurate and reliable measurement technologies to ensure

weather measurement. In the 1970s, we moved into

the integrity and safety of the products. The combined,

industrial measurements when we invented the modern

coordinated effort of the different entities related to the sector

way of measuring humidity with a capacitive hygrometer.

is critical in this mission.

We are a truly global institution that believes in the value of accurate measurement in solving the important

Q: Considering technologies like AI and Big Data, what

problems of our day. We invest more than 13 percent of

do you think measurement systems will look like in

sales in R&D, with more than 22 percent of our people

the long run?

dedicated to this area.

A: Real-time monitoring, data management and communication have been part of the design of many of our devices and systems. Following the trend of more

Vaisala specializes in the development, manufacturing and

comprehensive solutions, sensors will be even more reliable,

sale of products and services for environmental and industrial

adding flexible capabilities to be connected to a wider data

measurements. It offers measurement instruments for humidity,

control system. This will enable operators and users to take

temperature, barometric pressure, moisture, CO2 and more

faster and more precise actions.

VIEW FROM THE TOP |

PUBLIC-PRIVATE PARTICIPATION NEEDED TO BOOST HEALTHCARE JAIME CERVANTES CEO of Vitalmex

Q: How do Vitalmexâ&#x20AC;&#x2122;s certifications make a difference for

and applying technology and innovation to counter the

customers who hire the companyâ&#x20AC;&#x2122;s services?

lack of good administration. Apart from cutting costs,

A: In the health sector, we often talk about the state

information is also an important factor. Mexico does not

of hospitals and the infrastructure, but not about the

have a strong national registry to adequately channel

human factor. At Vitalmex, we invest significant resources

resources to patients. Without this information, we are

into creating the best working conditions because we

going to continue making errors in health administration.

understand that a companyâ&#x20AC;&#x2122;s workforce is its main asset

There is also the problem of corruption and resources

in an industry focused on offering services.

being wasted instead of being invested in patients.

We hope that treating employees well translates to better

Q: You employ an articulated service model. What is

care for patients. We try to share this with the industry

the difference with the integral model and how can the

through robust integrity and compliance standards,

industry apply this model universally?

hoping that these will eventually be the norm. The

A: An integral model is based on packages that group

government has already started to shift the industry

laboratories, analysis, surgery and other activities. In

toward this mindset with its Plan de Bienestar (Plan for

the articulated service model, as we call it, companies

Well-being) by evaluating companies based on their

focus on services and providing patients the best care

values and how they treat employees, patients and all

throughout their treatment. This means building the

other partners.

know-how to define what technology and logistics the patient needs at all times. Building this approach requires

Q: What benefits does your system provide to the

investment, however, to develop the right teams and

healthcare industry?

facilities to make this happen.

A: Vitalmex combines its knowledge, equipment, personnel and other key elements to deliver not only

Q: How is Vitalmex helping bridge the gap between the

health products but also an added-value service through

public and private sectors?

our consultancy that helps customers solve their

A: We formulated a five-year plan to help the government

needs regarding inputs and clinical management. We

create a model that allows better coexistence between

understand that patients want to receive the best service,

the public and private sector. We have understood that

which demands accessibility and a fair price.

this country does not need more hospitals. The existing infrastructure is underused, which mainly comes from a

Today, however, healthcare prices are fragmented. In

lack of cooperation between the public and the private

Mexico, it takes seven steps to bring a product to the

sector. Many private hospitals are practically empty. If the

market, without taking distribution into account. This

government and private industry come to an agreement,

represents between 15 and 40 percent of the price of any

we can avoid building hospitals and making unnecessary

new product. Logistics, meanwhile, contribute another

investments. We can standardize patient care through

45 percent to the final price. These costs lead to patients

contracts, and providers like Vitalmex can work efficiently

paying way more than the original cost of manufacturing

between institutions to cut costs.

the new medicine. Our country does not have the financial capacity to carry this burden, so we need to re-organize costs within the public sector.

Vitalmex sells, rents and loans medical equipment to hospitals and health centers. It also provides services such as consultancy

The key benefits we provide are efficiency, removing

on how to solve problems related to supply chain management,

unnecessary expenses related to intermediary processes

as well as medical and technical training

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| VIEW FROM THE TOP

MEXICO WILL NOT MANAGE WITHOUT INNOVATION HÉCTOR TIJERINA Sales Director of SELCI

170

Q: What are the main benefits and added value your

budgets of US$100,000 per piece of equipment. Although

company provides compared to other equipment

we are based in Guadalajara, our clients are spread across

providers?

the country. We operate through sales representatives and

A: We participate in industries like pharma, chemicals

sub-distributors but we are already looking at Mexico

and food and beverages, offering an integral solution

City as our next office destination. We are focusing on

that includes the technology from the different firms we

increasing our presence there, but it is not easy. The

represent. All our equipment partners are global leaders

macroeconomic climate does not favor large investments

in their own area. In addition to having a team with a

at the moment and we need to find specialized people

high level of expertise, we also try to provide equipment

who know our products.

and services at a good price and with a strong aftersales approach. Although we may not be the largest equipment

Q: What opportunities do you see for Mexico to advance

distributor in Mexico, we have a significant presence in the

as a technology and innovation hub?

field of analytics through the Japanese brand HORIBA,

A: Over the past 25 years, technology development

which has 70 years of experience in the market.

has blossomed in Mexico. However, there is still a lack of awareness regarding the implementation and

SELCI’s main target clients are companies with budgets of at least US$100,000 per piece of equipment

enforcement of manufacturing regulations, both in

HORIBA is the world’s third-largest company focused

education to raising awareness on how technological and

on analytics equipment and has trademark technologies

scientific innovations advance. There should be a focus

for identifying and characterizing particle sizes through

on boosting research and innovation toward patented

methods like laser dispersion. Particle size is important

products from a private and public standpoint, lest we

in many industrial processes because it reveals the

want to remain dependent on our relationship with other

properties of a substance and how it will aggregate or

countries for years to come. Mexico is simply not going

react. HORIBA’s technology can test particles regardless

to manage without innovation and its own patents.

of their state, whether solid, emulsified or any other.

Countries like Korea have developed an investment

terms of quality and ethics. When new products are developed without proper standards or quality controls, companies simply choose not to adhere to nonmandatory constraints. The central issue is education, ranging from traditional

strategy focused on R&D and now they are important Q: How does SELCI manage its sales strategy and what

players in this area.

are your growth plans regarding sales and distribution? A: We work with laboratory directors, scientists involved

Q: What are your main priorities for 2019?

in research and quality control and technology directors.

A: We want to consolidate another year of contracts, to

On average, our clients are medium-sized companies with

fulfill the expectations of our providers and to potentially open a new office in Mexico City. There are hindering factors that could impact the development of our

Servicios Especializados para Laboratorios Clínicos e

operations, including the dollar-peso exchange rate, the

Industriales (SELCI) is a Mexican company founded in

political climate between Mexico and the US and changes

1993 that provides equipment for laboratories, as well as

in incentive packages and tax schemes in both countries.

installation and aftersales service

However, we will continue looking for new opportunities.

VIEW FROM THE TOP |

QUALITY CONTROL LEADS TO HIGHER PRODUCTIVITY NADIA RODRÍGUEZ Pharmaceutical Business Manager of Malvern Panalytical

Q: What impact has the merger between Malvern

Q: What is Mexico’s contribution to the company’s

Instruments and Panalytical had on the country’s health-

global goals?

related operations?

A: Our presence here is primarily focused on growing our

A: Malvern Panalytical was formed through the merger of

position and brand in Mexico. We are already well-known

these two companies as well as two smaller companies

in the area of particle-size measurement but that is not the

named ASD and Claisse on Jan. 1, 2017. Before the merger,

case for our entire portfolio. Mexico is a door to the rest of

Malvern and Panalytical already worked together in

Latin America and if our strategy proves successful here, we

overlapping industries. However, there was an opportunity

can expand to other countries in the region.

to create something that would offer more options to clients and provide the advantage of cross-sales. The merger

Q: Malvern Panalytical participates in various conferences,

combined the expertise of Malvern in the pharmaceutical

forums and workshops. What is your goal with these outlets?

arena with Panalytical’s portfolio of analytical equipment for

A: We try to show that our company is more than just

various sectors. The result is a more integrated and diverse

a product. We invite people to learn about material

line of solutions.

characterization and how it can be performed. Ultimately, we are a group of experts with a lot of experience in the

Q: How do your solutions help pharmaceutical companies

pharmaceutical field. We often bring specialists over from

in their manufacturing operations?

the US and the UK to share their knowledge. We also take

A: The pharmaceutical industry is known for its strict

these opportunities to build closer relationships with our

regulations and standards set by different authorities.

current and potential clients.

These requirements define the form, size and composition of medication to ensure quality is maintained. Malvern

Q: What are Malvern Panalytical’s growth expectations for

Panalytical’s products allow clients to conduct accurate

the coming year?

analysis of their industrial processes at various stages. This

A: Our goal is to achieve 10-15 percent growth. We want to

helps them deliver better products and increase productivity.

penetrate the market with the newest technology. Apart from our leading market products, we also want to push

Q: How is your client portfolio divided locally and

areas such as heavy metal analyses. If we can secure two

international and what challenges do you face in Mexico?

or three projects in this area, we can use this experience

A: Half of our clients are Mexican companies and the

as a reference for the future. Some technologies are still

other half are international pharmaceutical corporations.

awaiting certification from authorities, which is an obstacle

International clients are more familiar with our solutions but

to building our brand in the market. Last year, we had a

the local industry is a bit more complicated. Many smaller

small dip in growth because several of our pharmaceutical

Mexican companies have limited budgets and often have

projects were canceled or stalled. The underlying reason was

their analytical work done by third parties or by universities.

the current political uncertainty. We expect this will improve

We believe investing in equipment like ours can provide

as the situation stabilizes. The pharmaceutical industry is

a great deal of added value in the long term. However,

one of the pillars of the Mexican economy and will continue

entering this segment remains a challenge.

to offer great potential.

In Mexico, about 75 percent of the products we sell are from Malvern’s product line. We are trying to increase the share of

Malvern Panalytical is a leading provider of scientific instruments

Panalytical equipment, which is more centered on elemental

used to measure elemental concentrations, crystallographic

analysis. In the area of medical devices, we are relatively

structure, molecular structure, remote sensing, rheology,

small but do offer some highly specialized technology.

particle size, particle shape, particle concentration and more

171

| PROJECT SPOTLIGHT

172

GETINGE: REINFORCING HIGH‑QUALITY EDUCATION In July 2015, former President Enrique Peña Nieto announced the creation of the Naval University, which aimed to efficiently regulate and coordinate in a single organization all graduate and technical schools and training centers managed by the Navy. Getinge was one of the partners selected to collaborate in making this project a reality. Getinge is a global provider of innovative solutions for operating rooms, intensive care units, sterilization departments and life science companies and institutions. Based on its firsthand experience and close partnerships with clinical experts, healthcare professionals and medical technology specialists, the company strives to improve people’s lives. With more than 110 years of experience manufacturing medical equipment and medical devices, Getinge has developed technology and new ways to provide better care for patients and help healthcare professionals in their daily work. The company integrates passion and technology to improve efficiency and focus on what is important: the patients. Changing from mock to functional machines was one of the improvements that helped make the Naval University project such a success. At the Naval University’s Health Sciences Center (CENCIS), students are able to develop the skills they need to comply with medical standards and experience real-life work, whether they are studying to become a nurse, a surgeon or any other clinical profession. Among other equipment, Getinge provided steam sterilizers for five different sterilization areas, along with automated washer disinfectors, surgical lights, ventilators and operating tables.

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CLEAN ROOMS ESSENTIAL FOR PHARMACEUTICAL QUALITY, PURITY FRANKLIN FELLER General Manager of Valtria Engineering

174

Q: How is Valtria Engineering contributing to the

room is tailored to the client’s needs, addressing concerns of

healthcare sector?

temperature and humidity, among others. We are developing

A: Valtria Engineering designs clean rooms and air purifying

a system that refrigerates more efficiently using equipment

systems for hospitals, dermatological and cosmetics

from Europe that employ compressors that generate less

companies, food producers, automotive companies and

friction. Frictionless equipment generates less heat and can

pharmaceuticals, among many others. However, reception of

be used at much higher speeds of up to 40,000rpm, while

these products varies widely by sector. Dermatological and

normal compressors operate at a range of 2,000-4,000rpm.

cosmetics companies are sometimes reluctant to invest in this

This reduces electricity use by 30 to 40 percent, which is a

technology, which can sometimes result in the contamination

significant savings considering the high amount of energy

of their products from fungi and other particles. Many hospitals

compressors require.

have also proven reluctant to incorporate this technology. The sector that invests the most in clean air is the pharmaceutical

Q: What are the main benefits of using clean rooms at

industry, which is why 80-90 percent of our sales are oriented

hospitals and clinics?

to this market. Strong regulations concerning pharmaceuticals

A: Introducing laminar air flow to purify the air that enters

production enforced by COFEPRIS have led companies to

high-risk hospital rooms helps to reduce the number of

invest in the highest safety standards to ensure all products

infections, especially in high-risk areas such as surgery rooms

meet established quality and purity requirements.

during heart and eye procedures. Some networks, such as Hospital Angeles and Hospital ABC, have already incorporated

Q: What are the main concerns of a pharmaceutical company

these technologies at some facilities.

when installing a clean room? A: The key concerns include maintaining stable temperatures,

Q: What are the entry barriers preventing wider acceptance

relative humidity conditions and a differential pressure

of this technology in the hospital sector?

between rooms. All pharmaceutical plants must monitor these

A: High costs to install laminar air flow equipment has made

conditions according to local regulations, including NOM-059

hospitals reluctant to install this technology despite the

that specifies the need for a system to continuously monitor

benefits they can bring to patients. Other countries have

differential pressure between rooms to avoid contamination

been much more welcoming of this technology but Mexico

from one room to the other. Plant compressors also require

might need additional incentives to introduce it, such as

continuous maintenance to avoid cross contamination. Valtria

policy changes. Not all hospitals need this type of equipment,

Engineering keeps close track of equipment maintenance. If

however, only those that perform high-risk operations.

filters are not changed regularly, for example, the system’s efficiency diminishes.

What

are

Va l t r i a

Engineering’s

growth

expectations for 2019? Q: What new products is Valtria Engineering introducing to

A: Valtria Engineering is growing significantly in the

the pharmaceutical sector?

pharmaceutical sector. The company is present in Argentina,

A: Valtria Engineering imports and integrates different

Spain, Switzerland and Finland. In Mexico, we have offices

components for the construction of its clean rooms. Every

in Mexico City and Guadalajara and hold approximately 5-10 percent of the market for clean rooms. We have aggressive growth plans for the near future, having recently started a

Valtria Engineering has over 15 years of experience in the design

project with PISA Farmacéutica, one of the largest medication

and installation of clean rooms and other critical areas for

manufacturers in the country. In 2019, we expect to double or

pharmaceutical and high-technology industries. The company

triple our market participation in the pharmaceutical sector

has installed 150,000m2 of clean rooms in 15 countries

and to develop our presence in other sectors as well.

VIEW FROM THE TOP |

COFEPRIS DEMANDING STRICTER PRODUCTION STANDARDS PABLO PÉREZ GAY Industrial Director of Rossbach México

Q: What advantages does Rossbach offer to its Mexican

its location. This gives far more control and improves response

clients as a distributor of precision instruments?

times in case there are problems.

A: Above all, we offer expertise. For the past 50 years, we have built significant know-how and what I call “know-who.”

There is a fundamental difference between waiting for

Knowing a lot of people in the public and private sectors

something to happen and preventing something from

means we can provide a channel for our clients to build their

happening. For example, if temperatures change rapidly at

presence in the Mexican market. I see Rossbach as an embassy

a plant due to weather fluctuations, production can waver.

that acts as a representative for companies abroad.

We have had clients that were losing up to 30 percent of their production on bad days before they started working

Q: How relevant is the health sector for your current

with us. Our data provides a detailed overview of risk factors

operations?

and ensures companies can better anticipate changes in

A: Our relationship with the health sector is largely in the

working conditions. More importantly, however, is that

industrial area. We work with pharmaceutical companies,

these technologies have a real impact on the health sector’s

offering our solutions for monitoring all kinds of environmental

evolution. Ensuring medicines are produced and stored under

and climatic conditions at industrial plants. Our products in

the right conditions is vital for patient safety. COFEPRIS is

this area are practically all from Vaisala, although we include

also becoming stricter in its standards and their enforcement,

other brands in certain projects.

demanding more conditions be measured and reported. This is making our solutions increasingly necessary.

Companies that seek our services tend to have two demands: meeting quality standards and regulations and increasing

Q: How have your solutions been received in the health

operational efficiency to cut costs. In many cases, to meet

market and what opportunities do you see for further growth?

a norm, a company chooses to use traditional methods to

A: We have had positive experiences with large pharmaceutical

measure quality standards. This means buying their own

companies. We have also helped smaller companies to meet

measurement equipment and having someone periodically

FDA regulatory demands so that they can export to the US.

download information manually to write a report. However,

We have a strong interest in Mexican producers of generic

this takes time and manual labor, which means extra resources

medications. The opportunity in the generics market is huge,

and money, and it does not provide continuous access to

especially in Latin America, and we should work together to

information. Our solutions, on the other hand, provide real-

strengthen this sector.

time data of all the critical points defined by the company at the click of a button. The system can include indicators of all

In the area of refrigerated transport and distribution, we

types and alarms when limits are breached. Even though the

have come to an agreement with Lufthansa to monitor its

initial investment may be higher, it will cut costs in the long

distribution center in Mexico. In climate-controlled operations,

term, save time and offer far better data.

you need to be able to track factors like humidity and temperature every single minute. Our systems allow Lufthansa

Q: What do you see as the more pressing need in terms of

to monitor cargo from the moment it leaves a client’s plant in

monitoring devices?

Germany until it reaches its final destination in Mexico.

A: The technology already exists. What is necessary right now is to raise awareness of the need for these products. Many pharmaceutical companies have their headquarters in the US

Rossbach México was the first factory for precision instruments

or a European country but build their production plants in

in Mexico. It is an exclusive distribution partner of Vaisala, SATEL

different parts of the world. Our monitoring systems allow

and Kipp & Zonen and has solutions for the life sciences, electrical

these companies to track conditions at any plant regardless of

equipment, mining, communications and solar radiation industries

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| VIEW FROM THE TOP

STERILIZATION VITAL IN SAVING LIVES ANDER GENTRY Director General and Co-Founder of Gamma Biolabs

176

Q: For which type of sterilization process are your

Q: What advantages do you get from your work with local

biological indicators in highest demand?

suppliers?

A: Our biological indicators are used to test whether

A: We believe in Mexico’s producers and the national human

something has been properly sterilized. They are mostly

talent. As a result, most of our supplies come from local

used in steam sterilization but demand for dry heat

producers. This allows us to work closely with them to make

sterilization is also growing.

changes and improve our products, while lowering costs and improving logistics.

We are the only producers of biological indicators in Mexico. This provides us advantages in terms of fast and

Q: What are your views on the state of the industry

high-quality supply. We also provide training services to

regarding sterilization and its importance for overall

our clients, teaching the right skills to get the most out of

operations?

our products.

A: In the pharmaceutical industry, standards are generally higher. Hospitals and clinics, however, often only buy our

Q: Who are Gamma Biolabs’ main clients and how are they

products so they can fulfill the norms set by COFEPRIS. A

divided between the public and private sectors?

robust sterilization policy is necessary to prevent infections

A: Our main clients are in the pharmaceutical industry;

and disease that could occur as a result of equipment and

they are the most important users of biological indicators.

device contamination.

Other clients are hospitals, dental clinics and diagnostic and research laboratories. Overall, we have more than 300

Q: What are Gamma Biolabs’ main goals for the near term?

clients spread across the country that we support through

A: We are doing research on two different products in

our offices in Guadalajara and Mexico City.

the area of sterilization. Our goal is to launch these in late June or early July 2020. In terms of clients, we are looking to target bigger players, including multinationals.

Gamma Biolabs is a Mexican company that produces

We want to export to more countries, especially in Latin

technology to monitor sterilization processes. Its solutions

America and Europe. The company already has an office

include mini incubators, moist and dry heat and ethylene oxide

in the Netherlands, which is focusing on entering the

biological indicators

European markets.

VIEW FROM THE TOP |

ADDED VALUE PRODUCTS KEY FOR GROWTH JORGE FAUGIER Director General of Indukern México

Q: What was Mexico’s contribution to Indukern’s 8 percent

from last year’s delays will probably lead to marginal net

global growth in 2018?

growth for the industry in 2019.

A: Indukern will turn 20 years old in Mexico in 2020. Our profits in Mexico amount to about US$100 million per

Q: What added value does Indukern offer its clients in the

year, which represents between 10 and 12 percent of

pharmaceutical industry?

Indukern’s global profits. Over the past few years, Indukern’s

A: As the world’s largest pharmaceutical manufacturer, Tapi

operations in Mexico have grown at a double-digit rate,

gives us a significant amount of information regarding the

which is much faster than the average of the industry. Our

future of the market, such as patents that will expire in the

two largest offices in Latin America are Brazil and Mexico,

coming years and new products that will become increasingly

which are also the two largest markets in the region. While

available to the industry. As a result, we can guide clients on

Brazil’s offices are older than Mexico’s, both countries make

which products they can start manufacturing today to launch

almost the same profit.

in the market in three to five years. Indukern has evolved from a distributor to a guide for our client’s growth and

The pharmaceutical sector represents 18 percent of our

portfolio development. Moreover, our large inventory, which

global profit. In Mexico, our pharmaceutical division sells

can only be maintained through a strong financial arm, also

active pharmaceutical ingredients (API), excipients and

gives us significant flexibility to help our clients.

will start with intermediates for both generic and patented medication manufacturers. We are exclusive distributors

When suggesting action plans to our clients, we analyze

and representatives of Tapi, Teva’s active pharmaceutical

both patents that will expire and the potential market. For

ingredients division, which is the largest manufacturer

that reason, I always recommend that clients share as much

and distributor of generic APIs worldwide. Our main

information as possible with us. The more information we

clients are generics manufacturers, such as Bausch Health,

have regarding their future plans, the better we can interact

Laboratorios Silanes and Laboratorios Sophia, but we have

with them.

approximately 50 active clients in this division. Q: Which new product lines will Indukern launch to the Q: What are the main changes affecting Mexican

market in the short term?

pharmaceutical manufacturing?

A: The product line that will grow the most in the

A: Our strength resides in our local inventory, which gives us

coming years is specialized products, mainly oncological,

speed and flexibility to adapt to market changes. We follow

antibiotics, some herbal extracts and finished products such

our client’s sales forecasts while managing the risks related to

as supplements. Other products that will grow in Mexico

changes in the market. This year, our products remained longer

are those that treat the country’s most prevalent diseases,

in stock as clients delayed their acquisitions and lowered their

including diabetes and cardiovascular illnesses. During 2019,

sales forecasts. Pharmaceutical manufacturers have slowed

we will focus on incorporating added-value products and

production during the past year due to the change in federal

lines that complement our current portfolio. Finally, we will

administration, which introduced uncertainty into the market.

explore the sale of final generic products through Kern Pharma, Indukern’s manufacturing arm for final products.

While the private healthcare sector has maintained a steady pace, the public sector represents much larger sales of medications and medical supplies. Public tenders

Indukern is a chemical distributor focused on raw materials for

were partially paused in 2018 and were reactivated in 2019.

the pharmaceutical, chemical, food and veterinary sectors. Its

Thanks to the tenders in mid-2019, we expect the latter half

pharmaceutical division includes fentalines from Kern Pharma,

of the year will be much more active. However, the impact

Fersina, Huvepharma, TEVA (Tapi) and others

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| VIEW FROM THE TOP

TECHNOLOGY TRANSFORMING HOSPITAL INFRASTRUCTURE CÉSAR RODARTE Director General of ARQmedyca

178

Q: How does ARQmedyca differentiate from other

and the required cabling. Remote monitoring is making

architecture firms?

distance healthcare increasingly possible, which means

A: Our core business is in developing, designing, remodeling

hospitals are going to have fewer overnight patients as

and constructing overnight stay-and ambulatory hospitals.

they go home to rehabilitate. This is further stimulated

We meet with our commercial suppliers before executing

through less invasive surgical procedures that are more

a project, working with them to ensure our plans come

accurate through better technology. In the area of artificial

together. Besides the architectural component, we also

intelligence, we see a growing ability of smart computers

help clients oversee the financial side of their investment

to make decisions regarding treatments by simply entering

to determine when they can expect a return on their project

the patient’s data. We have a client with a network of 300

and to give them control over their spending.

doctors who conduct patient consults via telemedicine. Doctors can now do part of their work without ever seeing

Virtual reality is changing the patient experience at hospitals and at their own homes

the patient. Virtual reality experiences are also starting to prove their worth in providing patients a more pleasant experience during treatment in hospitals and at home. Through telemedicine, the doctor can see what the patient is doing

We also have broad expertise on regulatory frameworks.

allows doctors to give patients real-time instructions for

Before we start a project, we guarantee that it will be

their own rehabilitation. All these technological changes

approved by COFEPRIS and we help clients understand

demand a transformation of hospital infrastructure.

what they need to do to comply with regulations. We offer training courses pertaining to the norms and standards of

Q: What is ARQmedyca’s strategy to attract new clients?

the industry and certify anyone that takes them.

A: Most leads come from recommendations of existing clients. About 90 percent of our business remains in the

Q: What changes have you observed in hospitals today?

private sector. We certainly see opportunities to increase

A: Rapid changes in technology are having a big impact

cooperation with public bodies, especially considering

on the health sector. Hospitals of the future will become

the actions the government is taking to put IMSS, Seguro

service centers where you will see a symbiosis between

Popular and the Ministry of Health under the same roof.

humans, machines and IT. Doctors will increasingly spend

This is going to help increase competition in the health

their time in research and preventive healthcare as opposed

sector as a whole.

to purely curative care. Robots are increasingly doing the surgical work while doctors control them through interfaces

In terms of the technological developments happening in

that feed them the whole picture of the patient’s status.

the health sector, I see an opportunity for the private sector to step in and fulfill projects in the public arena. This will be

We are already creating special designs for operating

aided by increased public spending on health.

theaters that allow for these new forms of technology Q: What are your top goals for 2019? A: Right now, we are strongly focused on increasing our ARQmedyca is an architecture firm specialized in projects for

level of research. We are performing research projects

the development, construction and remodeling of clinics and

for patients to have a better experience and a better

hospitals. It provides services such as design, architectural

rehabilitation during the stay at the hospital, focusing

planning and management for the health sector

mostly on environmental psychology.

VIEW FROM THE TOP |

PUBLIC-PRIVATE ALLIANCES COULD FIX HEALTH INFRASTRUCTURE MIGUEL VELÁZQUEZ CEO of Grupo Empresarial MDF

Q: What are the main constrains when building hospitals

that have been converted into clinics and often, they are

and clinics in Mexico?

not interested in modernizing.

A: One major constraint is funding. Hospitals have limited access to the financial sector, since they are seen as a risky

The private sector and the government should work together

investment due to the large amount of cash payments they

to gradually upgrade these small clinics. We can start with

receive. Mexicans do not have a culture of insurance, partly

surgery facilities and then move on to diagnostics and overall

because it remains too expensive. Hospitals have to generate

hospital services. These projects can take five to six years

bills without names, leading to poor financial management

but would increase productivity greatly. In April 2019, the

that reduces a business’ credibility. The financial sector does

Ministry of Health released a list of hospitals considered white

work with several large hospital groups and very small clinics

elephants. In Oaxaca, 52 hospitals were built at a budget

but it is more reserved with medium-sized institutions that

of MX$200 million (US$10.2 million) for each and they are

have between 20 and 60 beds. Small clinics generally need

no longer in operation. Once the government completes

a much smaller amount of money for construction projects

the construction project, it hands the hospital over to the

– between MX$3 million (US$150,000) and MX$5 million

ministry, which does not have the budget to run it nor to

(US$260,000). For a medium-sized group this is not enough

offer competitive salaries. Hospitals are normally built due to

because these groups require loans of between MX$50

election promises but they are not part of an effective long-

million (US$2.6 million) and MX$80 million (US$4.1 million).

term health strategy based on industrywide coordination.

Q: What strategies has Grupo MDF implemented to

Q: Which countries could serve as an example for Mexico

increase efficiency in construction and reduce costs?

to improve its healthcare system?

A: We are focusing on making our whole operating strategy

A: Chile has implemented telemedicine as a way to provide

more efficient to reduce construction costs. With software,

health services in remote areas. The five health clusters

for example, we traditionally designed our models using

in that country also offer training to recently graduated

AutoCAD, which allows drawing in 2D and modeling in 3D.

doctors, sending them to clinics in remote areas, which

Now, we are training our people to use a process called

offers them significant field experience. In exchange,

Building Information Modeling (BIM). This software allows

doctors can come back after three years and study the

you to design, build, define construction materials and

specialty of their choice fully paid by the government.

resolve all problems that arise after the design phase, all the way to the maintenance of the building. We expect

Chile has also established an agreement called 25-25-25 that

to launch our first project using BIM in 2019. We hope it

forces every new administration to propose 25 new hospital

will make our operations more efficient by increasing

projects of different sizes, start the construction of those

the accuracy of our inventory. We can now see exactly

projects and complete any outstanding projects regarding

how much we need of a certain product and order the

the 25 hospitals proposed by the previous government. This

precise amount. Additionally, we can determine the exact

initiative offers continuity, which allows parties from both the

specifications of the material, allowing us to improve the

public and private spheres to understand where the sector is

construction process and to drive down the cost for the

going and how they can better tune their strategies.

client by up to 20-25 percent. Q: What role does infrastructure play in improving

Grupo Empresarial MDF specializes in the construction of

healthcare access?

hospitals, clinics and laboratories. It offers services, such as

A: Most small clinics in rural areas do not have the right

management of construction sanitary permits, medicinal licenses,

facilities to receive patients. Many are simply former houses

advertising permits, architectural and topographic surveying

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REGULATION KEY TO UNLOCKING CLINICAL TRIAL POTENTIAL PATRICIA ZURITA Country Director Mexico of Eurotrials, a CTI Company

180

Q: How has the acquisition by CTI Clinical Trial and Consulting

Having said that, Mexico has a large number of researchers

Services changed Eurotrials’ operations in Mexico?

who have worked for many years in the sector. Many started

A: The acquisition gave Eurotrials a broader footprint, opening

in public institutions and then opened their own research

the doors to the Americas, Asia, Europe and Oceania. It also

centers, which are now performing their own clinical trials.

diversifies our service portfolio to include development and

These centers are fully staffed with specialized doctors and

strategy, clinical services, research, life-cycle support and real-

experts in clinical trials. We are looking for research centers

world evidence and late-phase research. CTI has 20 years of

with fully dedicated professionals who have that kind of

experience as a multinational company providing services to

expertise.

18 of the 20 largest pharmaceutical companies in the world. We are now following all of CTI’s standards and procedures.

Q: How can CROs help to increase access to healthcare services in Mexico?

In Mexico, we are focusing on two areas. The first is

A: Clinical trials provide a way for patients to access innovative

epidemiological and real-world evidence studies, both of

medicines before they are available in the market. This is

which are in high demand by the pharmaceutical industry.

especially important in Mexico because the registration

The second is rare diseases, a CTI specialization. Our studies in

process for innovative treatments is too long, so patients

both areas are feasible in Mexico thanks to the country’s large

do not have timely access to the medications they need.

population, which proves an advantage when researching rare

It is necessary for the government to develop strategies to

diseases as the number of patients is usually quite small in

support access to clinical trials and to see them through.

other regions. Eurotrials has worked with treatments for Fabry

Some measures have already been implemented, such as the

disease and lysosomal diseases in Mexico. In 2019, we plan to

development of Habilitated Units for Preapproval Support

develop several projects addressing diseases common to the

(UHAP), which review all documentation and preapprove

country, such as type 2 diabetes.

research protocols before they are analyzed by COFEPRIS.

Q: How would you describe Mexico’s local capabilities for

It is also necessary to speed up the implementation of clinical

clinical trials and what is Eurotrials looking for in the research

trials at public institutions like IMSS and ISSSTE, as this would

centers it partners with?

give a broader number of patients access to medications and

A: It is necessary to change regulations concerning approval

it would make these more affordable. Long approval times

times both for clinical trials and for registration of new

and delays in the process add up and increase the final cost

medications. Mexico has efficient approval times on paper

of the medication for the patient. Shorter trial periods would

but regulations are not consistently applied and delays are

allow Mexico to compete globally with major players and to

common. Long and sometimes unpredictable processes leave

reduce the final cost of medications. IMSS, AMIIF, CANIFARMA

Mexico as a second choice for pharmaceutical companies

and ACROM are searching for ways to speed up approvals.

that prefer Eastern European countries, where times are shorter and trials are less expensive. These countries have

Clinical trials also train physicians and hospital researchers in

the disadvantage of having a much smaller population than

methodologies and standards that have proven to be useful

Mexico, making recruitment harder.

in establishing processes and improving organization in institutions and researchers’ own initiatives. This is important for Mexico to grow into the new trends of collaborative

Eurotrials, a CTI Company , is a CRO that specializes in clinical

research where public institutions and other industry

and translational research in the areas of rheumatology,

participants design common projects and share knowledge to

ophthalmology, oncology, rare diseases, cardiology and others.

solve society problems that span from unmet medical needs

The company was acquired by CTI in 2017

to rare diseases or pathologies.

VIEW FROM THE TOP |

HIGH INVESTMENT IN TECHNOLOGY NEEDED TO ENCAPSULATE MARKET ENRIQUE GARZA CEO of CAPSU-GAMA

Q: What challenges is CAPSU-GAMA facing to expand its

Moreover, food supplements face weaker regulatory

share in the capsule market?

restrictions so manufacturers prefer lower-quality alternatives

A: CAPSU-GAMA represents ACG Group’s high-tech capsule

that are produced at a lower cost. The food supplement

and packaging equipment. ACG Group is one of the two

market is also more artisanal, with many processes being done

largest capsule distributors worldwide. There are very few

by hand or using old machinery, unlike the pharmaceutical

suppliers in the capsule market, even on a global scale. While

industry, which invests heavily in technology so its processes

capsules may seem simple, they require a complex engineering

are automated.

process and technology so it is very hard for new companies to enter and succeed in this market niche. To manufacture capsules, it is necessary to have significant experience in the sector and a large initial investment. Manufacturing capsules is an expensive process with a slow return on investment. Before the introduction of ACG Group products, our

The Mexican pharmaceutical industry requires 10 billion capsules per year

competition had a monopoly in the Mexican market for 30 years. Penetrating this market requires hard work because it

Q: Where is the sector heading in terms of technological

sometimes can take up to three years for a client to switch

development?

to our technology. However, clients are now prioritizing the

A: There are many opportunities for high-tech capsules. For

quality of the product over its price so we expect that they

instance, three new methods are gradually permeating the

will continue to switch to our products. We expect to grow at

market. The first is capsule filling for solids that must be

a steady pace and capture about 20 percent of the market.

inhaled, which can have applications for respiratory diseases. These capsules are put in place and then broken so the patient

Q: What specific benefits would you highlight regarding ACG

can breathe in the medicine. The second are extended-

Group’s capsules?

release capsules. Normal capsules dissolve in 15 minutes

A: ACG Group began operations producing capsules manually

but some medicines cause stomach problems if absorbed

and, over many years of research, developed the technology

by the stomach. For that reason, some medicines, such as

and processes it has today. Quality is the main advantage of

Omeprazole, are packed in micro-pellets, which take longer

our capsules but CAPSU-GAMA also offers clients two types

to dissolve and thus their impact on the stomach lining is

of tech support services. The first analyzes the performance

smaller. Other capsules that take even longer to dissolve can

of equipment to improve production processes. The second

safely travel to the intestine.

concerns the capsules’ design and filling. Large pharmaceutical manufacturers in Mexico, such as Sanfer, Pfizer and Sanofi, buy

The third application are liquids in hard gelatin capsules. Soft

their capsules from us but they fill them in-house because they

capsules are often used to pack liquids and hard capsules

need absolute control of the filling process.

for solids. However, some liquids cannot be packed in soft capsules due to their chemical composition so a technology

Q: What is CAPSU-GAMA’s share in the food

was developed to pack these medicines into hard capsules.

supplements market? A: In Mexico, the food supplement market is very small in comparison to the US, representing about 10-15 percent of

CAPSU-GAMA distributes ACG Group’s empty, hard capsules

the capsule market versus about 30 percent in the US. For

of vegetable origin, which also have kosher and halal

that reason, our operations in Mexico are mainly focused on

certifications. It also provides encapsulating machinery and

the pharmaceutical sector.

services for drug manufacturers

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| VIEW FROM THE TOP

GENERICS GREENFIELD FOR STRONG NATIONAL PRODUCTION ALONZO AUTREY Managing Director of DVA Mexicana

182

Q: What is DVA Mexicana’s greatest contribution to the

participation in the market, generics manufacturers have

Mexican pharmaceutical industry?

also been noticed by the current government, which

A: We supply raw materials for the pharmaceutical

is highly interested in strengthening pharmaceutical

industry that range from active ingredients to excipients

production at a national level.

and medicine coatings. The latter are produced in a special plant recently approved by COFEPRIS, which sets

Many generics laboratories come to us to work on new

us apart from our competitors. We are a company with

projects, create new formulas and register new products

a broad portfolio that responds to patients’ needs and

in the market. New products are constantly being

can adapt its solutions in terms of quantity, color and

launched, which has generated healthy competition and

conditions of use.

provides a strong opportunity for our company. Each year we work on more than 100 new developments with

We also participate in other chemical-based industries

generics clients.

and in the food sector. Our approach to all our operations is the same and we sometimes manufacture products for

Q: What are your short-term goals and what will be

several industries at the same facility. Therefore, these

Mexico’s role in your development strategy?

uphold the same standards stipulated by our company

A: We have a strong research team that is always looking

and by regulators like COFEPRIS.

to develop new solutions that can open new opportunities with potential clients. Currently, we have a patent planned

Q: How relevant are best practices and quality standards

for production at our plant in Mexico. Our intention is

in Mexico’s pharmaceutical industry?

to work with our clients to develop medicine at a good

A: When companies have good business practices that

price and we hope to start exporting to the US by 2021.

are internationally recognized, it does not matter where they produce. A company with strict standards will introduce those to every country where it establishes operations. Some of our clients say they find COFEPRIS very strict in its audits and inspections and in some cases, companies have had to pause production for six to 12 months. This is a challenge for every company looking to enter this sector in Mexico. Q: What has made Mexico such an attractive destination for generics manufacturers? A: The reason is that design and development of generic medications can take place in Mexico. Meanwhile, most international companies that produce patented products do so in their home country. Because of their significant

DVA Mexicana is a German raw materials supplier for the pharmaceutical, food, industrial chemicals and crop protection

industries.

employees in Mexico

The

company

has

around

750

VIEW FROM THE TOP |

PRECISE DOSAGES, ACCESSIBLE COSTS REQUIRE SPECIFIC CAPSULE SOLUTIONS ANIL ANDRADE Director General of ACG Group

Q: Why should ACG Group be considered the ideal partner

quality norms. We like to work with pharmaceutical companies

for pharmaceutical companies that seek integrated

in Mexico because we know they do things right.

solutions for manufacturing? A: When ACG started over 60 years ago, the owners

At first, we faced the challenge of being unknown in the

decided to focus primarily on the healthcare industry.

market. We had to develop a marketing program to raise

Every product and service we have developed has been

awareness of our brand and convince customers to try our

specifically designed for the pharmaceutical industry, which

products. Over the last five years, we have grown substantially

means we have gained significant expertise in capsule

and customers have seen we are a serious company to work

manufacturing and drug processing equipment. We also

with. We have the resources and are here to stay. We work

cooperate closely with pharmaceutical producers to meet

with local partners to provide technical support and maintain

their specific requirements and regulatory standards.

equipment for our products. We definitely see Mexico as a market with major growth potential, which is why we have a

There are a lot of mergers and acquisitions in this industry

quite aggressive plan for 2020. Because of our proximity, we

but we remain true to ourselves as a third-generation

know products developed in the US will find their way into

family-owned company. We are professionally managed

Mexico for manufacturing. Equally, Mexican pharmaceutical

by a group of CEOs, but we are a private company. Because

companies are introducing new products to the market. We

of this, we put almost all our revenue back into the company

can be ideal partners for them.

to generate new innovative products and services. Q: How does ACG Group help to reduce counterfeit Q: What strategies does ACG Group follow to meet its

medicine production?

clients requirements?

A: This is a global problem that we have been able to address

A: Many customers come to us with a specific problem. Our

in several ways. For example, we have the capability to

R&D department designs specialty capsules and the machines

develop intricate prints on capsules that include up to four

needed to make them. One of our areas of expertise is liquid-

different colors and cannot be duplicated by counterfeiters

filled capsules. Another is inhalation capsules for people

because of the complexity. We also create special capsules

with COPD, asthma or lung infections. Given the global

and packaging technology for customers and duplicating

trend toward animal-free products, especially for dietary

the molds is truly complicated.

and vitamin supplements, we developed a vegetable-based capsule that works just as well as gelatin. A few years ago,

Counterfeit products often do not look at the intricacies of

we designed an award-winning special blister package for

the packaging. We have a special company in our group

a medication used to treat basic diseases in Africa, where

that is focused on inspection, tracking and verification. This

humidity and temperature were rendering regular packages

allows us to go to existing pharmaceutical companies and

ineffective. We also developed the machine to make the

rebuild their processing and packaging equipment so they

package and kept the product cost-effective.

can add certain characteristics, such as barcoding and batch aggregation. We collaborated on hundreds of product lines

Q: What does the Mexican market mean for ACG Group?

and have since brought this technology to other markets.

A: We started working in Mexico five or six years ago. We saw it as a large and well-developed market with a great deal of potential. We have since introduced a number of encapsulation

ACG Group is a supplier of integrated manufacturing solutions for

machines, tableting machines, blister material for packaging

the pharmaceutical industry. Its varied range of products includes

and capsules. Customers in Mexico are knowledgeable and

capsules, films, foils, machines for encapsulation, tableting, tablet

there is a strong culture of compliance with regulations and

coating, blister packing, cartoning and fluid bed processors

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LONG-TERM VIEW CAN HELP REVAMP CLINICAL RESEARCH MELISSA ROSALES Director General of RM Pharma

184

Q: Last year, RM Pharma announced the creation of an

requires attention in Mexico. RM Pharma specializes

association in Mexico to promote research in the country.

in rheumatology, immunology, pediatrics, respiratory

What are the latest developments?

and chronic degenerative diseases and we are starting

A: The Associated Centers for Excellence in Clinical

with gastroenterology and urology protocols. Because

Research (SAIC) is up and running. RM Pharma and SAIC’s

of this, we have no immediate plans to participate in

other founding members are inviting more research

the oncological area. The company focuses on chronic

centers to join. The association’s goal is to help research

degenerative diseases because its study will be key for

centers develop a more holistic view of clinical research.

future generations due to the aging population. RM

RM Pharma’s focus will be to help companies organize

Pharma has developed a clinical research group that

their talent, their processes and other aspects related

collaborates with IMSS to accelerate administrative

to research. SAIC is now also a member of the Research

processes for pharmaceutical companies with processes

Commission of CANIFARMA.

such as CRF and also provides coordination of research services.

Q: What advantages and disadvantages does RM Pharma see in ending multiplicity of lanes?

Q: Volunteer recruitment is key to developing a clinical

A: Authorities analyzed this concept for years. The idea

research industry. What is RM Pharma’s approach and

was that those protocols previously approved by foreign

how can this area be improved in Mexico?

regulatory agencies, such as the FDA or EMA, were not

A: In the US, volunteers receive financial compensation

required to pass a COFEPRIS review. This simplification

for participating in clinical research, while in Mexico,

represents a reduction in approval times of up to one

pharmaceutical companies only pay for travel and food

month, which makes the industry more competitive.

expenses. If a similar remuneration were applied in Mexico, we would run the risk of receiving more volunteers than

The real challenge for COFEPRIS is to ensure it has the

could be accepted and they probably would not meet

necessary human resources to carry out this initiative since

the necessary criteria to participate. I believe that the

at present the team designed to review the protocols is

dynamics of not contributing economically should

small, which delays the process. If COFEPRIS’ idea is

continue unless it is a Phase I project, which requires

harmonized and implemented efficiently, attraction of

volunteers for a longer period of time.

projects from Europe and other markets could grow. There are many laboratories that seek to do research in Latin

Rather than monetary incentives, education is key.

America but until now these companies have not found

Volunteering for a clinical research study gives patients

the channels that facilitate these opportunities.

options to treat their illness and help eliminate from society the stigma that volunteers are guinea pigs.

Q: Why is RM Pharma’s focus on rheumatology and does

In the case of volunteers who collaborate with RM

it have any interest in moving into areas like oncology?

Pharma, word-of-mouth is used to encourage patients

A: Oncology is a focus for the authorities because

to become clinical research volunteers. In the near future,

it is an industry trend but it is not the only area that

we plan to provide more structure to this network and carry out a program called Ambassadors for Health in which volunteers themselves promote volunteerism.

RM Pharma is dedicated to phase I-IV clinical research studies,

In exchange, they can obtain discounts for laboratory

medical services, services to the pharmaceutic industry and

studies, medications and medical assistance. The purpose

CROs. The company specializes in therapeutic areas such as

is to promote healthcare and encourage people to

cardiology, dermatology and general medicine

participate in clinical research.

INSIGHT |

CLINICAL TRIALS BLOOM THROUGH PUBLIC-PRIVATE COLLABORATION KAREN HAHN Director of Global Program Management at ICON

The high investment needed to develop new medicines is

signing contracts between both parties. “We were aware that

leading pharmaceuticals into emerging economies like Mexico.

public institutions had good doctors but we had no access

Thanks to its lower costs for clinical trials and excellent

to them due to the many barriers we faced to sign public-

physicians and researchers, the country will become an even

private contracts,” she says. “Now that contracts are finalized,

more attractive investment destination, according to Karen Hahn, Director of Global Program Management at ICON, fueled as well by collaboration between the private sector and public healthcare institutions. “Pharmaceutical companies are looking for ways to offset costs,” says Hahn. “Mexico’s lower costs for clinical trials outweigh the attractive conditions offered by other countries.” Medicines must follow a long and costly road from molecule discovery to commercialization. A 2018 study by the Tufts Center for the Study of Drug Development calculated the cost for drug development at US$1.2 billion. Headquartered

“

everything else will fall in line.”

Mexico’s lower costs for clinical trials outweigh the attractive conditions offered by other countries”

ICON has signed contracts with IMSS and other healthcare

in Ireland, ICON is a multinational CRO whose goal is to

institutions to perform clinical trials. Although doctors

accelerate the development of medicines and medical

from public institutions often have no experience in these

devices, thus reducing this cost. The company employs over

studies, Hahn points out that institutions are often open to

13,250 people in 38 countries and specializes in oncology,

provide as much training as necessary to their physicians. The

CNS, internal medicine, infectious diseases, gastrointestinal,

expectation is for these collaborations to strengthen, thanks in

women’s health and rare diseases.

part to renewed interest from the federal government under President López Obrador.

Hahn says ICON is betting on Mexico as a key part of its development strategy for Latin America. “At this point,

The one possible hurdle is regulatory delays that could set the

Mexico and Brazil are the most important countries in Latin

sector back. “CROs need continuity in regulatory processes

America for the company. Studies that would previously go

to avoid a slowdown in approval times,” says Hahn. ICON is

to Colombia, Peru and Chile are now going to Mexico, Brazil

opening new business areas at its offices in Mexico City to

and Argentina,” she says. Beyond the low cost for clinical

prepare for increased demand for its services, one of which

trials, Hahn explains that interest in Mexico also is increasing

is focused on data management, which it expects will bring

because of the country’s excellent physician pool and large

an added value to clients. “Our goal in the short term will

prospective patient population. Moreover, companies are

be to continue strengthening our business areas and prove

seeing potential for increasingly specialized tests. “We see a

to our headquarters that they were worthy investments.”

growing interest in more specialized areas, such as PVSS and

The company is also partnering with ACROM in offering

project management,” says Hahn.

courses to keep clients updated on the latest changes in regulation. During 2018, ICON participated as a lecturer

Collaboration between CROs and public healthcare institutions

during a pharmacovigilance training program for CROs and

will be the key to untap the country’s clinical trial potential.

pharmaceutical companies organized by ACROM. “While the

CROs have targeted the public sector due to the latter’s large

sector is already knowledgeable regarding pharmacovigilance

patient population. Although there have been efforts from

procedures, these change continuously so companies must

the private sector to align to the needs of public institutions,

remain updated at all times,” says Hahn. “We will push to make

the challenge, according to Hahn, has been finalizing and

this an annual course and keep CRO employees up to date.”

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| VIEW FROM THE TOP

PHARMACOECONOMIC STUDIES GUARANTEE BETTER ACCESS TO MEDICINES ARTURO RODRÍGUEZ CEO of INFINITE

186

Q: Why should small biotechnological developers consider

Q: What is INFINITE’s approach to evaluating the efficiency

INFINITE the ideal clinical research partner?

of a pharmacological study?

A: As a small, flexible and adaptable company that works

A: We use an integrated approach that considers all variables

according to the needs of these types of developers,

throughout the treatment and the drug’s success rate after

we provide greater chances of success for our partners.

the patient has been treated. For example, with oncological

Developers are not affected by administrative processes

medicines, we evaluate how long the patient was hospitalized,

derived from dealing with a more complex CRO, which allows

how many sessions they went through, the side effects that

the client to focus only on the development of their molecule.

appeared and other general indicators to determine the cost

INFINITE also is specialized in integral clinical operation

of each variable. Meanwhile, a study for a diabetic treatment

strategies and gives support to small and medium companies

considers the drug’s ability to keep the disease under control

with shoestring budgets for investment.

for a certain period of time, as well as the cost of all the related diseases that may appear as a side effect of the treatment,

One of our current projects is with a developer of a vaccine-

such as circulatory problems, diabetic foot or more complex

related to allergic reactions. We help this client look for

metabolic issues.

potential users of its medicines in Mexico and we also collaborate in finding the appropriate primary and secondary

Q: How can the federal government benefit from medical

packaging solutions to carry out randomization processes. In

research to provide better access to healthcare?

collaboration with UNAM and hospital partners, INFINITE also

A: The clinical research sector attracts foreign investment

helped the company find qualified researchers. Today, we have

which helps generate jobs and opportunities for both people

completed 80 percent of the project and the client is satisfied

and businesses. We want to help the government understand

with our performance.

how this can benefit the public healthcare sector and the entire health value chain, while also supporting its goal

Q: How can pharmacoeconomic studies increase access to

toward universal healthcare access. Clinical research gives

healthcare in Mexico?

patients access to new treatments for free; yet, Mexico only

A: Pharmacoeconomic studies help to evaluate a new

contributes 1 percent of the world’s clinical research projects.

drug’s cost-effectiveness and to provide tools to make the

If the country were to attract another 1 percent of the world

best decision when selecting drugs and clinical devices for

available market, that could represent up to US$200 million

patients. Previously, clinical research only considered drug

in added clinical research investment.

safety and efficacy, but economic factors are now included to ensure product cost-effectiveness, thus guaranteeing entry

Q: How will INFINITE’s rebranding strategy impact your

to the basic tables of public institutions.

position in the market? A: In the beginning, we enjoyed a certain advantage in the

Previously, companies developed pharmacoeconomic studies

country and in Latin America because we were one of the few

when the product was ready to enter the market. Nowadays,

companies that gave big CROs legal representation. This made

it is necessary to perform these at an early stage to evaluate

it easy for clients to identify us. Now that we have expanded

the cost-benefit of research products.

our reach to international operations, we have found other companies that have very similar acronyms to ours. Our goal is to stand out in the market, which is why we decided to

INFINITE is a 100 percent Mexican institution with 15 years of

rebrand ourselves as INFINITE on our 17th anniversary on May

experience in clinical research in Latin America. Its services

16, 2019. This implies revamping our public image and the way

include clinical study monitoring from phase II to phase IV and

we interact with new market conditions. We need to cater to

medicine registration for institutional basic lists

young innovators in charge of the decision-making processes.

VIEW FROM THE TOP |

TECHNOLOGY A KEY FACTOR TO ENSURE CLEAN, SAFE OPERATIONS JOSÉ LUIS JACQUES Director General of Lavartex

Q: How much does the healthcare sector contribute to

arrive safely and hygienically clean and/or sterilized to

Lavartex’s business?

their destination. Lavartex is the leader in clean products

A: Lavartex has three divisions: healthcare, hospitality and

for hospitals thanks to these practices and we see it as

the recently launched industrial uniforms area. Healthcare

our responsibility to continue promoting the best safety

is our largest division now, followed by hospitality.

standards throughout our entire distribution chain. To do

The industrial uniforms division focuses mainly on the

so, we invest in training and certifications for our personnel

automotive, aerospace, pharmaceutical, foodstuffs and

to ensure they follow standard procedures. We also monitor

chemical sectors.

our suppliers and only work with those we can confirm adhere to high safety standards.

We provide services in 29 states. We are only missing Sonora, Baja California and Baja California Sur, which we

Q: What technology investments set Lavartex apart from

expect to enter by 2021. We are happy to work with service-

its competition?

oriented hospitals that aim to provide the best care possible

A: While our oldest plant is 97 years old, we continuously

to their patients. Our services ensure that products arrive

invest in state-of-the art equipment to increase our

either hygienically clean or completely sterilized to the

productivity and quality of service. In 2018, we expanded

hospital.

our plant in Tlaxcala that now incorporates equipment comparable to that of European facilities. We are

Q: What are the main gaps Lavartex has identified in

beginning to invest in the use of robots at our plants and

Mexico’s hospitals and how do these influence your

in the digitalization of our systems, mainly at the point of

operations?

delivery and in operational controls to improve customer

A: Mexico still lacks the necessary healthcare infrastructure

experience. We are planning to incorporate a radio-

to care for its large population. There is a wide gap between

frequency identification (RFID) microchip in all fabrics,

the services provided by the private and the public sectors.

which will greatly facilitate inventory control. At this point,

Moreover, the quality of service in public institutions can

35 percent of our CAPEX covers innovation in software and

vary widely depending on the institution. Some federal

hardware to improve our processes.

hospitals have standards equal to those in private hospitals while some state institutions have large deficits in services

Q: Why is technological investment so important to Lavartex?

and supplies, especially at the primary care level.

A: We are gradually incorporating technology into our services and processes. Companies that do not adapt will

From the beginning, Lavartex’s goal has been to provide

disappear. Few of our competitors are investing in this switch

high-quality services comparable to those of first-rate

because most are following labor practices developed in

hospitals across the globe, regardless of whether clients are

the 1970s. Mexico is still a labor-intensive country but many

in the public or private sector. Very few private hospitals in

industries, including automotive, aerospace and healthcare,

Mexico hold a Joint Commission International certification,

are gradually incorporating more technology. If we do not

but each day more and more are moving in that direction.

perform this switch alongside them, we will be unable to work with them.

Q: How is Lavartex investing in technology to guarantee it provides high-quality services? A: Lavartex has three core principles: safety, honesty and

Lavartex, founded in 1922, is a leading provider of specialized

discipline. Our safety practices extend throughout our

textile

entire operation, from our clients to our employees. We

services for hospitals, hotels, restaurants, sports clubs and

aim to prevent all work accidents and ensure that products

manufacturing facilities

washing

solutions.

offers

world-class

integral

187

LOGISTICS & SUPPLYÂ CHAIN

Not too long ago, many healthcare organizations viewed logistics as an afterthought; they considered it as simply a way to stock products well enough to avoid shortages and overages. Today, the supply chain is seen as a key element to ensure the efficiency of processes, resources and employees that work in harmony to provide secure treatments and services to the patient. Globally, the sector is perceiving an increasing demand for home-based healthcare, temperaturesensitive pharmaceuticals and tailor-made logistics services. While logistics are further complicated in Mexico due to infrastructure and safety concerns, operators are increasingly betting on technology and training to improve their practices.

This chapter analyzes, from interviews with distributors, logistics operators and other key players, how technologies have become a mechanism to address the challenges and opportunities of delivering products in a timely and secure manner.

189

CHAPTER 9: LOGISTICS & SUPPLY CHAIN

192

VIEW FROM THE TOP: Víctor Soto, Distribuidora Levic

193

VIEW FROM THE TOP: José Alberto Peña, Grupo Marzam Healthcare Distribution

195

VIEW FROM THE TOP: Patrick Troop, Pharma Tycsa

196

VIEW FROM THE TOP: Alejandra Groff, GMMC

197

VIEW FROM THE TOP: Bernd Schreiber, Multivac Mexico

Jesús Garcia, Multivac

198

PROJECT SPOTLIGHT: Levic: Bringing Health to the Population

200

VIEW FROM THE TOP: Ana María Pedroza, MedPrimex

201

VIEW FROM THE TOP: Eduardo Trueba, ETrueba Distribuciones Farmacéuticas

202

VIEW FROM THE TOP: Alberto Barella, EMP

204

VIEW FROM THE TOP: Gretel Lozano, LG Distribuciones

205

VIEW FROM THE TOP: Rodolfo Camargo, El Crisol

206

VIEW FROM THE TOP: Eduardo Tapia, DHL

207

VIEW FROM THE TOP: Eric Delgado, Grupo Sicamsa

208

VIEW FROM THE TOP: Karl McDermott, Morpheus.Network

209

INSIGHT: Francisco Cruz, Hubble Logistics México

210

INSIGHT: Alesio Bereciartu, OCASA

211

INSIGHT: Ildefonso Vázquez, IVG Group

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| VIEW FROM THE TOP

COMMON STRATEGY NEEDED TO INCREASE ACCESS TO MEDICATIONS VĂ?CTOR SOTO Director General of Distribuidora Levic

192

Q: Approximately 80 percent of the medications you sell

Q: How does Levic guarantee fast delivery of products

are generics and 20 percent are patented. How will the new

given the particular challenges of the region, including

distribution center in Vallejo impact your product portfolios?

security and infrastructure?

A: With our new distribution center in Vallejo, we will be

A: Our logistical operation is highly effective in reaching

able to grow our portfolio to more than 10,000 different

clients every day in every corner of the country. If there

products. These will include almost all available generic

is a contingency due to a security issue, we send the

medications in the market and will create an opportunity

order again after a 24-hour window to ensure the client

to broaden our offer of patented medications, OTCs and

receives the order. Highway security incidents represent

formulas. Everything is part of our objective to provide

losses of close to MX$10 million (US$510,000) yearly. We

more health resources to the population. In the short

try to minimize them with 24-hour monitoring through

term, we are aiming for sales of about 50 percent generics

satellite tracking of all our units, as well as guards on

and 50 percent patented medicines in terms of value. In

particular routes.

units, this translates to 75 percent generic medications and 25 percent patented products and others.

Q: What would you identify as the main challenge in the pharmaceutical industry in Mexico?

Highway security incidents represent losses of close to MX$10 million (US$510,000) yearly

A: There is a need for a strategy between the

Q: How might technology transform the medicine

Q: Last year, you mentioned Distribuidora Levic was

distribution sector in the long term?

expecting to grow 70 percent in the next five years.

A: Distribuidora Levic is a 100 percent Mexican

What actions are you taking to accomplish growth?

company with a strong commitment to providing safe,

A: Our growth in 2019 will only be 3 percent below what

quality medicines and medical supplies to people with

we expected. We believe the cause was weaker national

the objective of increasing access to healthcare and

economy. This will improve in 2020 when all the changes

improving the populationâ&#x20AC;&#x2122;s quality of life. Our new

we are seeing reach a level of maturity. We will continue

distribution center in Vallejo, Mexico City, is making

to look for new clients and markets, expanding our

efforts to automate its processes and we expect it to

portfolio and improving our service. At the moment, we

be up and running in November. Automation will not

do not have a solid projection of growth for the next five

lead to a complete transformation, but it will improve

years due to the current economic landscape. However,

the speed, efficiency and precision in which sorting is

we hope to grow at a double-digit rate annually over the

carried out, which will be reflected in better service for

next two years.

pharmaceutical industry and the government that allows greater access to medications and other health-related resources for the population, while at the same time stimulating development of the industry to generate jobs and to boost the economy.

the population. Q: What are your three main goals for 2019-2020? A: The first will be to start full operations at our Distribuidora Levic is a leader in storage, distribution and

new distribution plant: the CEDIS project in Vallejo.

sale of medicines in Mexico. It has a commercial alliance with

Secondly, we want to extend our portfolio to increase

150 national and transnational production laboratories and

our competitiveness in the market. Lastly, we want to

commercializes more than 5,000 pharmaceutical products

maintain our double-digit growth.

VIEW FROM THE TOP |

MEXICO’S OLDEST DISTRIBUTOR OF MEDICATIONS LOOKS TO THE FUTURE JOSÉ ALBERTO PEÑA Director General of Grupo Marzam Healthcare Distribution

Q: What results has Grupo Marzam obtained from its

service to our own group companies instead of to other

diversification strategy in its sales channels and product

companies. The center will allow us to increase our efficiency

offering?

and assure the optimal handling of our stock. It was the

A: We began seeing good results from this strategy in 2018,

creation of this center that led us to question our internal

mostly in sales to the private sector where we developed

operations to address whether they could be improved. This

several channels, including independent, regional and

is the time for us to change.

national chain pharmacies, self-service stores, private hospitals and insurers. Moreover, we are diversifying our

Q: How will Marzam use technological trends to improve

client base to incorporate the public sector, which now

its operations?

represents 4 percent of our sales. Our channels in this

A: For the past two years, we have been developing a

sector are consolidated tenders, decentralized hospitals

technological roadmap that we will follow for the next five

and state healthcare systems, among others. Grupo Marzam

years. This roadmap let us identify the company’s needs

also diversified its product offering from prescription

and how to implement new solutions without paralyzing

medications to now include consumer, hygiene and beauty

our operations. Technology has to improve our operations,

products, generics and medical supplies and devices. All

not become an obstacle for business. Technology is allowing

these different sectors are now growing steadily. In 2018, the

us to make our operations safer, faster and more dynamic

company’s objective was to ensure that our growth remained

while being fully focused on clients. Technology evolves on a

sustainable for the long term.

daily basis but we are well-positioned for these changes. For instance, our entire sales force manages orders through their

Q: How is Grupo Marzam contributing to the development

smartphones. They also have access to stock information

of a patient-centric model?

online and in cities where we have a distribution center, we

A: While we do not interact directly with patients, we want

can offer same-day delivery in some cases. In the worst-

to create links with those that do, including government,

case scenario, the product is delivered the following day.

private pharmacies, hospitals and insurers. We want to

Previously, it took us between four to five days to release a

position ourselves as the best business partner for those

credit line for a pharmacy. Now it takes us two hours.

who treat patients by ensuring efficiency, good service and dynamism. We are now analyzing our logistics platform to

Q: How can the technology you are introducing into your

see if the way we work is the best solution for our clients

practices be used to predict market changes?

as most of it was designed 15-20 years ago. The market,

A: Close monitoring of changes in the market may allow

our commercial partners and consumers have changed.

us to predict which medications specific areas might need,

Technology is playing an increasing role in logistics and it

based on data from that same year. We use this information

is necessary to take that into account when analyzing our

internally to determine how much of a product’s stock should

internal operations to see whether we need to change. We

be allocated to a specific location. So far, we are using last

have to decide how we should change in the coming years

year’s data to estimate the following year’s stock but we

to address the needs of the future. For instance, in some

want our estimates to be in line with current market needs,

Mexican regions where we have distribution centers, business

not last year’s.

has changed enormously and we are discovering that these centers are not in the best location to meet current and future market needs.

Grupo Marzam Healthcare Distribution, created in 1934, is now the oldest distributor of medications in Mexico. The company

Our new distribution center in Lerma is different from the

has 11 distribution centers and 43 regional centers with 16,000

previous 10 as it was developed with the goal of providing

clients in the public and private sectors

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VIEW FROM THE TOP |

GOOD MIXING PRACTICES IMPROVE TREATMENT EFFECTIVENESS PATRICK TROOP Managing Director of Pharma Tycsa

Q: How has Pharma Tycsaâ&#x20AC;&#x2122;s Clinical Breast Integral Service

national laboratories. Pharma Tycsa is an attractive partner

evolved since 2016?

for laboratories because it can guarantee product safety

A: COFEPRIS establishes the minimum requirements for

and ensure patients receive their treatments in optimal

preparation and dispensing of nutritional and medicinal

conditions. Most oncological treatments require a controlled

sterile mixtures in NOM-249. At the moment, there are 25

temperature environment and cold chain logistics. Pharma

mixing centers that comply with COFEPRISâ&#x20AC;&#x2122; regulations in

Tycsa is involved in the whole process, ensuring appropriate

four states and 19 belong to the same company. This means

treatment transportation as well as optimal conditions

most health institutions are mixing components outside the

for mixing the compound. Our philosophy is that safety

norm, threatening patient safety, especially among those

involves everything from manufacturing, transportation and

receiving oncological treatment.

mixing to the moment of application.

Pharma Tycsa created a service to improve compounding

Q: What are the advantages of a laboratory working with

practices through the construction of mixing centers in

a compounding center?

facilities providing oncological treatments. The company

A: The final stage of the treatment chain takes place at

started providing this service at breast cancer clinics but

infusion centers where patients receive chemotherapy,

today caters to all oncological areas. Our compounding

for example. Pharma Tycsa created a new service that

centers ensure compliance with safety standards to lower

efficiently connects laboratories with infusion centers

contamination risks and increase treatment effectiveness.

through compounding centers. Though infusion centers have

In most cases, patients with cancer die from side effects

standards regulated by COFEPRIS, Pharma Tycsa observed

and not precisely from cancer. Thanks to our solution, we

that most do not comply with regulations related to the

can guarantee patients are not exposed to contamination

mixing of treatments. Through its new solution, Pharma

that could be fatal.

Tycsa ensures regulatory continuity, safety and treatment effectiveness from the laboratory to the infusion center.

Q: What recommendations would you give to health authorities regarding the low concentration of mixing centers?

Q: What are Pharma Tycsaâ&#x20AC;&#x2122;s growth expectations for 2019?

A: The Mexican norm is more demanding than most

A: In 2016, Pharma Tycsa achieved its goal of incorporating

international regulations. The first step should be to align

its services at oncological hospitals and expanding its

the Mexican norm with international standards and, secondly,

clinical Pharmacy Integral Service, a process that continued

to incentivize the use of hard data to evaluate existing

in 2017. For 2018-2019 the company has three main goals:

compounding centers homogeneously. This would provide

promotion and construction of compounding centers across

greater certainty regarding the performance of all mixing

the country, development of health attention schemes for

centers and a more measurable improvement opportunity

chronic degenerative diseases and consolidation of our

for each. For example, Pharma Tycsa built and equipped its

traditional treatment distribution channels for the public

laboratory in four months but going through the regulatory

sector. Pharma Tycsa is also working individually and with

red tape took two years. Working with international

laboratories in the development of treatments for diabetes,

standards, objective and not subjective indicators, could

hypertension and obesity.

simplify this process without compromising quality and help provide patients with better and safer oncological treatments. Pharma Tycsa is a distribution, marketing, representation and

Q: Why is Pharma Tycsa the ideal partner for laboratories?

project development company focused on pharmaceutical

A: Around 60 percent of our sales focus on multinational

products.

laboratories while the remaining 40 percent are oriented to

laboratories and wholesalers to support its services

The

company

has

strategic

relationships

with

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| VIEW FROM THE TOP

INTEGRATING EQUIPMENT TO GENERATE NEW FUNCTIONS ALEJANDRA GROFF Director General of GMMC

Q: How is GMMC evolving its value proposition to adapt to

are increasingly aware of the benefits of acquiring high-quality

the sector’s changing needs?

supplies; they are educating themselves and switching out

A: We are working with many different brands, such as

low-priced products for better equipment.

Welch Allyn and Schiller, to integrate different equipment 196

into a single system that gathers all available information to

Q: What are the main challenges when training professionals

provide new functionality. GMMC is also working with doctors

to use GMMC’s solutions?

to develop projects that allow them to provide care in rural

A: Unlike younger generations, older doctors have been slow

areas. Over the past six years our goal has been to provide

to incorporate technology into their day-to-day practices,

remote diagnostics. It is not easy, but we hope that Hill-

although they are open to learning. However, we have found

Rom’s acquisition of two brands we distribute, Welch Allyn

that nurses are more reluctant to accept anything that takes

and Montara, will facilitate this by allowing the generation of

them out of their comfort zone, so we have to work much

a broader product line. We are working with manufacturers

harder to convince them to use the system.

to develop comprehensive solutions that we can offer to doctors and clinics. The old sales model that involved the

Q: How did GMMC tailor its product portfolio to address

sale of equipment no longer works; it is now necessary to offer

current market needs?

clients internal solutions that directly address their problems.

A: GMMC started operating with the goal of importing products from medium and small-sized companies that did

Q: How has your business model evolved and what role do

not have a budget to hire their own distributor in Mexico. In

integrated solutions play in it?

the beginning, we were three partners that handled products

A: We are focusing more on subleasing the equipment and

from around the world but our product portfolio was too

providing comprehensive services. The goal of these services

diverse and we felt it was better for the business that the

is to incorporate technology into daily operations so that

three of us separated.

doctors, hospitals and clinics can offer patients all the tests they require from the moment they are diagnosed and during

Although we now all operate individually, our close connection

their rehabilitation. Seventy percent of our sales are directed

allows us to easily purchase products from regions we do not

to the private sector.

normally manage. Our product line is still too big; to continue growing, our goal is to refine our product portfolio and

Q: What benefits do hospitals and doctors get from acquiring

acquire new products only in areas related to cardiology and

your solutions?

diagnosis. We will also increase our online presence and focus

A: Many hospitals are seeing the benefits of integrating all

on our existing customer base instead of looking for new ones.

information into a single system, which automatically stores it in the patient’s clinical file. Compiling this information

Q: How is the market for medical devices different from one

reduces errors and provides a cleaner and more precise file

region to another and how does this impact your sales?

compared to the previous method. This technology allows

A: Demand for our products varies depending on the region.

doctors to reduce their margins of error and gives all medical

For instance, we have had trouble entering Merida’s market

professionals more time to devote to other matters. Hospitals

because it is common for businesses in the city to import medications from Miami. Although this market is challenging, we will continue our push to expand into the Southeast. The

GMMC Mexico is a medical devices and solutions provider

north of the country has been much more welcoming to

for the diagnosis and emergency segments. The company

foreign products with the exception of Baja California, which

distributes brands such as Welch Allyn, Huntleight and

receives few products and at exorbitant prices due to local

Schiller

import and export taxes.

VIEW FROM THE TOP |

TRANSFORMING PACKAGING SOLUTIONS THROUGH TECHNOLOGY Bernd Schreiber CEO and Executive Director of Multivac Mexico

Jesús Garcia Manager of the Medical and Industrial Division of Mexico, Central America and the Caribbean of Multivac

Q: How is Multivac adapting its value proposition to the

BS: Industry 4.0 is here to stay. Even though Mexico has a

evolving needs of the medical industry?

large and capable workforce, companies face significant

BS: Multivac’s goal is to grow by offering more than packaging

turnover that could be solved through automation. In terms

solutions. We offer complete packaging systems that

of processes, it is now necessary to monitor every single

incorporate robots, X-ray equipment and thermoforming

package individually, which generates large amounts of

machines, as well as packaging materials that can meet the

information that must be processed. Multivac is also working

extremely demanding requirements of the medical industry

on improving efficiency in the production and distribution

in terms of certifications. We are also implementing Industry

of medical products. Our machines are able to self-diagnose

4.0 practices and investing in technology to use cloud data

and monitor when manufactured pieces fall outside of the

to remotely diagnose equipment and increase manufacturing

specified production parameters and send an alert when

capabilities. This will help reduce human error.

equipment repairs are necessary. This increases equipment efficiency and raises production output by 15-20 percent.

JG: The goal of Multivac’s medical area is to provide quality products and reduce risks. Recalls are a major problem in

JG: The FDA introduced a regulation concerning Unique

the pharmaceutical sector and 50 percent of these are due

Device Identification (UDI) in 2012 that is still under revision.

to product packaging. We work with clients to develop a

Previous packaging strategies included lot numbers for

strategy that addresses every step along the way, developing

a large number of products. UDI identifies each individual

tailored approaches according to the conditions in which the

product and provides comprehensive information related

product should be packaged.

to when and where the product was produced, packaged, sterilized and stored. This traceability is essential for quality

Q: What are Multivac’s main contributions to the medical

control. We are creating a cloud database with packaging

sector and which companies are its main clients?

specifications for every product we work with. This will help us

JG: We have global contracts with the largest medical devices

consider the different needs of each manufacturer and adapt

companies in the world, including Johnson & Johnson and

our equipment automatically to the packaging materials

Medtronic and with Mexican manufacturers. Multivac has

that products use. This data bank was created using real

installed distribution centers in strategic areas, including

information obtained from tests with clients.

Tijuana, Nogales, Chihuahua, Ciudad Juarez, Guadalajara, the Bajio and Mexico City, to supply these companies. In the

Q: What new products has the company introduced to the

pharmaceutical industry, we provide secondary packaging;

Mexican market?

in the medical industry, we deliver primary packaging. Our

JG: We recently introduced an innovative packaging

equipment for the pharmaceutical sector focuses more on

product called SNAPSIL. What differentiates this product

automation and control than on packaging, while for medical

is its “snap” opening mechanism. To open a glass ampoule,

devices we offer a complete portfolio.

pressure is applied, which could lead to cuts or small pieces of glass falling into the product. SNAPSIL is made of

BS: We manufacture over 1,200 thermoforming machines

plastic, avoiding these risks and making the product much

per year. Multivac was formerly classified as a thermoforming

easier to open.

company but it has invested strongly in the acquisition of new companies. It now incorporates labeling machines, X-rays, robots and other equipment.

Multivac is a Germany-based company specialized in packing solutions for the medical and foodstuffs industries. Its solutions

Q: What are the advantages of incorporating Industry 4.0

can be used in semiautomatic and automatic packing systems

practices in Multivac’s operations?

for medical and pharmaceutical products

197

| PROJECT SPOTLIGHT

198

DISTRIBUIDORA LEVIC: BRINGING HEALTH TO THE POPULATION With more than 18 years of experience as a leader in medicine storage, distribution and sales, Levic is a strong partner to independent pharmacies, distributors, clinics, hospitals, government agencies and health professionals. The company’s vision is to be the No. 1 pharmaceutical distributor, while ensuring the greater good for employees and society. The company strives to meet market requirements with highquality products at the best possible price under a framework of respect, equality, commitment, honesty and loyalty. With eight warehouses spanning 64,639m3, Levic covers 100 percent of the country’s territory and offers a portfolio of more than 4,500 products, including bioequivalent, transnational and patented medicines, healing material and more. To continue providing solutions to clients, Levic inaugurated its Robotized Distribution Center Vallejo (CEDIS). The new CEDIS is integrated with automated mechanisms and processes that provide Levic with better control, logistics and improved services for customers. CEDIS Vallejo is the company’s first robotized corporate unit and, along with its other distribution centers in Tultitlan, Tlahuac, Veracruz, Tabasco, Chiapas, Queretaro, Michoacan, Leon, Jalisco, Puebla, Monterrey, Tijuana and Merida, will help the company meet its clients’ demands. The new center will commercialize more than 5,000 high-end technology products. Structurally, it has a capacity of 8,100m2 where thousands of strategically ordered products can be handled and stored without difficulty for active and efficient distribution throughout the country.

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| VIEW FROM THE TOP

INVESTMENT IN PREVENTION MEANS LESS EXPENDITURE FOR TREATMENTS ANA MARÍA PEDROZA Director General of MedPrimex

200

Q: What is MedPrimex’s most successful venture in Mexico,

Awareness is important not only for early detection of cancer

considering its diverse product portfolio?

but for prevention. There is a great deal of ignorance regarding

A: OC-Auto FIT is, without a doubt, our strongest product.

the benefits of a good diet in preventing cancer and the fact

It is an immunochemical colorectal cancer screening test,

that smoking increases the likelihood of colon cancer. We work

meaning an improved fecal occult blood test. We started

closely with the Ichy & Santy Foundation for early detection of

developing this product six years ago, recognizing that a

cancer to disseminate knowledge regarding prevention and

clinical test for colorectal cancer (CRC) could save lives

early detection of CRC with OC-Auto FIT, especially among

through prevention. At MedPrimex, we believe prevention

vulnerable segments of the population.

is the starting point to proper healthcare and a way to make expenditure in this sector much more efficient. Treating a

Q: How does MedPrimex use genetics in relation to diet and

patient with CRC costs the government over MX$1.5 million

the potential to reduce the probability of getting cancer?

(US$78,000) a year, while a MedPrimex test to detect CRC

A: Our ADNnutriControl program uses genetics to help

costs less than MX$1,000 (US$52).

patients lose weight, improve their quality of life and eat healthier. It is a genetically-customized program that

CRC is the third-most frequently diagnosed cancer in

tests genetic variations to determine how a person’s

the world and screening has proven effective for early

body responds to certain nutrients and food ingredients,

detection. MedPrimex purchased a state-of-the-art

thus providing insight into how to eat appropriately. This

analyzer that is 99 percent sensitive and 99 percent

program helps people lose weight 2.5 times faster without

specific to provide the most reliable results in the market.

affecting nutrition. Genes are the blueprint of our body and

Some of the advantages of OC-Auto FIT are that it is

understanding how they work can help prevent diseases

noninvasive, samples can be collected in the privacy of a

like obesity, which in 80 percent of the cases is related to a

person’s home, it detects lesions throughout the length

genetic predisposition. Unfortunately, penetration of genetic

of the large bowel, requires no bowel preparation and is

testing is still very low in Mexico because it is not affordable

very affordable.

for everyone. Prices average MX$30,000 (US$1,560), which means these tests are only available to upper-income

Q: Who can benefit the most from MedPrimex’s OC-Auto

households.

FIT and how have you worked to raise awareness on the importance of CRC testing?

Q: What alliances has MedPrimex formed to better market

A: OC-Auto FIT is best-suited for people over 25 years

its solutions?

old who have a family history of cancer. Otherwise, it is

A: We work with a network of allies, such as Dr. José María

recommended for 45-year-old patients or older. Statistically

Remes of the Autonomous University of Veracruz, to develop

speaking, of every 1,000 people who take our CRC test, 25

treatments. In cancer detection we work with Seguro Popular

need to follow up with a colonoscopy and only seven test

of Hidalgo and for early colonoscopies we have an alliance

positive. OC-Auto FIT’s reliability stems from its ability to

with Clínica Gástrica, INCAN and other health institutions.

distinguish occult blood from blood derived from raw foods

We have provided OC-Auto FIT to Seguro Popular for

and color from vegetables such as beets or red sodas.

some years. Our goal now is to collaborate with ISSSTE and IMSS. We are lobbying with the authorities, representatives, Congress and other high-ranking officials to make CRC

MedPrimex is a 100 percent Mexican supplier of medical

screenings a priority for healthcare. To ensure success, we

equipment and disease prevention and detection systems. The

are building a network of doctors to spread the word about

company’s products include a FIT Test for Food Sensitivity,

the importance of CRC testing and the advantages of our

ADNnutriControl, ADNhealthControl and OC-Auto FIT

OC-Auto FIT.

VIEW FROM THE TOP |

MARKET SATURATION SPURS NEW BUSINESS STRATEGY EDUARDO TRUEBA Director General of ETrueba Distribuciones Farmacéuticas

Q: What makes ETrueba Distribuciones Farmacéuticas

the necessary regulations and norms, which is one of

different from other companies that offer similar

the reasons why banks come flocking to us with credit

services?

proposals. We also have the advantage of being well-

A: Much has changed in the 60 years we have been in

established and having significant market experience,

the industry. My grandfather, who was a pharmacologist,

which gives us the opportunity to guide others in

cooked and prepared his own medicine. As years

tender processes. However, due to the current political

passed, he started distributing medicine from national

reality, we are not really focusing on the public sector.

laboratories to clients. My father developed our supplier

Furthermore, we are not interested in hospitals, public

catalog and always tried to find new ways to distribute

or private, because it is a niche that is already saturated.

products.

Private companies are more suitable for our current business model.

Ten years ago, our place in the distribution chain changed. Pharmacies started to manage the whole supply chain

Q: What is your strategy for expansion and growth in

and to effectively skip the middleman by dealing directly

the country?

with laboratories. These chains were much bigger players

A: We would like to attract a greater number of clients and

and had access to a lot of capital. This forced us to find

grow the volume of products supplied. Our operations are

new market niches by expanding our catalog and type of

spread across Yucatan, Campeche and Quintana Roo and

clients. We moved to a B2B model and stopped supplying

we still have much potential for growth. There is a great

doctors, pharmacies and clinics. Instead, we focused on

deal of work to do to consolidate this area. This will keep

companies that are not necessarily in the health sector

us busy for the foreseeable future. If we decide to expand

but do have internal health services. This move suited

beyond these states, it would be to Veracruz or Chiapas.

our strength of providing integrated solutions. Our clients require consistent deliveries, steady prices and

Q: What are your main three near-term goals?

efficient billing mechanisms. Our mission remains to

A: We have seen average annual growth of 25 percent

understand our clients’ needs and try to cover them in

in revenue since 2017. Despite not being directly hit by

every single way.

economic challenges, some of our clients do feel the impact. This year, we want to grow at least at the same

Q: What are the strongest products in your portfolio?

rate as last year and become the prime supplier for

A: We handle generics, patented products, healing

our clients. We also want to be seen as a trustworthy

material and medical equipment. Every one of these

partner for hospitals, pharmaceutical companies and the

has a different margin. My philosophy is to solve clients’

government. In terms of territory, we want to consolidate

problems and that means providing whatever product

our operations in the Yucatan peninsula or the Southeast.

they need. About 50 percent of our distribution focuses

As a company that provides health products, our

on medication and 50 percent on medical equipment and

obligation remains to the person who will receive the

healing materials.

medicine or treatment, which is why we strive to meet all regulatory norms and maintain our ethical standards.

Q: What is your relationship with the public side of the industry? A: Working with the government used to be fairly easy

ETrueba Distribuciones Farmacéuticas is a leader in the

until a year ago. Now, tender requirements have become

distribution and supply of medicines, medical supplies,

too complex. ETrueba Distribuciones Farmacéuticas

diagnostics and high-quality equipment for companies in the

has a solid history and a healthy record. We meet all

public and private health sectors of the Mexican southeast

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| VIEW FROM THE TOP

A SOLUTION FOR EVERY BUDGET ALBERTO BARELLA General Manager of EMP

Q: What role does Fujifilm play in your strategies?

and repairs for these machines are more costly and take

A: We are one of the eight Fujifilm equipment distributors

more time.

in Mexico and we are present in Oaxaca, Chiapas, Tabasco,

202

Campeche, Yucatan and Quintana Roo. We have our

Q: How would you describe the market for medical

corporate offices in Merida and have been here for 15

equipment in the southeast?

years. We also have an office in Chiapas in Tuxtla Gutierrez

A: The southeast is the poorest zone in our country

and want to open an office in Oaxaca. Most of our sales

and if there is no investment from the government in

are for imaging equipment, followed by endoscopy and

health, it will lead to a vicious circle. Prices of health

clinical analysis equipment for laboratories. We handle

services remain low because people would not be able to

the equipment installation and maintenance and we have

afford otherwise. This forces hospitals with imaging and

more service engineers than sales agents. This means

radiology departments to look for cheaper equipment

that customers can expect their equipment will be well-

to get an easier return on their investment, which often

maintained and that if there is a problem, we can help

means buying second-hand or refurbished machines.

quickly and with the right expertise.

There is a large market for this kind of equipment in the southeast.

MEDICAL DEVICE CONSUMPTION IN MEXICO MEDICAL DEVICE CONSUMPTION IN MEXICO FROM FROM 2016 TO 2020(MILLIONS) 2016 TO 2020 (US$ million)

There are signs that the market is maturing, however.

12,500

When new technologies become common in health services in the center and north of the country, people eventually start asking for them in the south. An example is mammography. In the southeast, from 2015 to 2018,

12,000

the number of breast cancer diagnoses doubled, which means more scans were necessary. Unfortunately, many hospitals and clinics continue to use dated analog

11,500

technology.

11,000

There is an overall lack of tools that in other countries 2016*

2017*

2018*

2019*

2020*

*Forescast Source: Statista

are considered basic. In some cases, it is because they cost too much to acquire, in other cases, doctors simply do not know them. An example is breast tomosynthesis, which is a 3D X-ray imaging technique that allows you to

Fujifilm equipment is robust and technologically

detect breast cancer at an early stage. But this requires

advanced. Other brands offer equipment that is often

digital equipment with advanced technology. Last year

a combination of hardware and software from different

we sold six machines with this capability. We organized

companies. This can cause malfunctions and makes the

a state congress for gynecology in Merida where we

equipment more complex to use. In addition, maintenance

introduced one of these machines to demonstrate its capabilities to doctors and raise awareness about the newest technology in the market.

Equipos MĂŠdicos Peninsulares (EMP) is a Mexican distributor of medical equipment, predominantly of Fujifilm, in the south

Q: Who are your main clients?

and southeast of the country. The company is in the process of

A: We supply to all types of clients and to anyone

becoming a distributor for GE and other brands

that has a need for the technology we offer. Our main

clients are hospitals with imaging services or an imaging department. We have a team for each type of machine, including refurbished equipment. Regarding the latter,

TOP 10 GLOBAL MEDICAL DEVICES COMPANIES 1. Johnson & Jonhson

the initial investment is going to be less but it is likely

2. GE Healthcare

to last a third of a new machine’s lifetime. We always

3. Medtronic

offer new equipment first, but clients often choose refurbished options. We work with both the private and public sectors at a rate of 60-40. Our operations are

4. Baxter International 5. Siemens Healthcare

supported by Fujifilm, which sends its own specialists

6. Phillips Healthcare

to accompany us during client visits. This is particularly

7. Cardinal Health

common for larger and more complex projects. Fujifilm also supports our participation in conferences. These are important opportunities to spread brand awareness and showcase the abilities of this high-end technology.

8. Covidien 9. Abbott Labs 10. Stryker Source: ProMéxico 2017

Q: What opportunities do you see in the clinical analysis niche? A: We mostly cater to medium and small-sized

Q: What are your growth expectations and what are your

laboratories, since we do not have solutions for large

main goals for 2019 and 2020?

clients. We are in the process of signing a contract with

A: We reached growth of 35 percent in 2017 and 2018.

GE, which will open this door to us. We are going to

For 2019, we have projected growth of 25 percent,

be the company’s official distributor in the southeast.

although early numbers show we might surpass our initial

We have already supplied material for them in the past

expectations. By including GE equipment this year, we

but we will start distributing larger equipment meant for

aim to become recognized distributors in the Mexican

tomography, resonance scans and others tests. GE offers

market. By 2020, we want to return to growth of 35

good quality and a competitive price. We will focus on

percent, minimum. In the meantime, we will continue

being distributors for these two manufacturers and build

to strengthen our services to ensure all our clients’

our portfolio with their solutions.

needs are met.

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TRUST ESSENTIAL FOR A SUCCESFUL DISTRIBUTION NETWORK GRETEL LOZANO General Manager of LG Distribuciones

204

Q: How are LG Distribuciones’ activities divided between its

A: Our main challenge is keeping the product in the right

different business verticals?

conditions throughout the entire process. Our cargo normally

A: Our focus is mostly on industrial activities, particularly in

needs refrigeration and using dry ice to cool the products

the food sector. Pork producer Keken and poultry producer

can be challenging over long distances. These climate

Bachoco are among our biggest clients. One of our flagship

requirements also imply higher transportation costs, which is

products in this sector is testing material for salmonella, but

an extra hurdle when trying to maintain competitive prices.

we also work with hospitals and other health institutions,

In terms of routes, road and weather conditions can cause

such as the Ministry of Health of Quintana Roo. Our products

delays, as well as customs. We need to be flexible and always

include medical devices, glassware and reagents. Our goal

anticipate potential problems. Sometimes we even need to

is to position ourselves as the best distributors among a

negotiate delivery times with our clients, which we can afford

strong field of competitors. Clients want discipline and

since we have relationships based on mutual trust. Our policy

certainty of delivery. We work according to COFEPRIS and its

is to immediately return to the supplier any product that

requirements, constantly implementing protocols to properly

arrives in an unsatisfactory state.

verify compliance to any new regulation. Q: What is LG Distribuciones’ participation in the

LG Distribuciones has presence in Veracruz, Campeche, Yucatan, Quintana Roo and Chiapas

health sector? A: We have several partners in the health sector. One is Heisecke, which produces rapid-testing devices, such as pregnancy tests. Although foodstuffs are 70 percent of our business, safe products and good testing material is essential for public health in this sector. We also work with regional milk producers and distillers. Our strength is not necessarily

Q: What territory do your operations cover and where would

hospitals, because there is a high level of competition there

you like to expand?

and some distributors offer better prices in this niche. Having

A: Our network stretches from Veracruz to Campeche,

said that, we do want to strengthen our collaboration with

Yucatan, Quintana Roo and Chiapas. We are not exporting

the Ministry of Health of Quintana Roo. We also want to start

to other countries but do have a presence in Guatemala. We

working with IMSS and ISSSTE and are analyzing if we can

are looking at possibly moving further south, toward Belize.

meet their fast-delivery requirements.

Our expansion plans depend on market opportunities. We are conducting market studies on the alimentary industry,

Q: What would be your three main goals for 2019?

particularly linked to our clients Keken and Bachoko.

A: Right now, we do not have a strong sales force. With only

We certainly want to grow our portfolio and number of

three sales agents and over 250 clients, we are constantly

clients, as well.

working to catch up with our backlog. Our growth has truly surprised us, after having tripled our client portfolio in six

Q: What are the main challenges you have found in product

years. We will continue working to be considered the first

distribution?

option among clients and suppliers. In terms of territorial expansion, we want to cover the whole southeast part of the country in five to six years. It is worth mentioning that our

LG Distribuciones is a distribution company based in Merida,

growth has only been possible thanks to the immense support

Yucatan. It supplies consumables and equipment to about 250

of our partner suppliers. They have helped us with lines of

clients spread across the country’s southeastern states. It supplies

credit, consistent schedules of delivery and general trust in

laboratories, hospitals and other health institutions

our ability to do our job.

VIEW FROM THE TOP |

E-COMMERCE STRATEGY OPENS DOOR TO NATIONAL, INTERNATIONAL MARKETS RODOLFO CAMARGO Director General of El Crisol

Q: How has El Crisol’s modernization and restructuration

pushing and as businesses, we have to understand it as an

process advanced since 2018?

investment and research opportunity.

A: We opened three new offices in Guadalajara, Torreon and Merida. We have also been preparing to start exporting to

Q: How is El Crisol including sustainability in its products?

the Caribbean and Central and South America. In terms of

A: Our last-generation products use state-of-the-art

new projects, we are in the preliminary stage of developing

technology that considers environmental sustainability. For

a new distribution center. We have already bought the land

instance, our ultra-freezers have the best energy efficiency

and we expect it to be the largest investment the company

in the market. They can go as low as -86°C and use gases

has made. The distribution center will occupy 2ha and we

that are completely innocuous to the environment. These

are already analyzing the needed investment in technology

types of freezers are used to store mother cells or umbilical

and the logistics processes we will need to implement to

cords, which means that once the sample is there, the

serve the domestic and the export markets.

equipment must stay on at all times.

We have transformed our logistics operations completely

We also have a strong focus on durability, so even though

and increased the amount of direct shipping we handle. We

we cannot provide the most economical products, we do

are also building an e-commerce platform to strengthen

provide those with the highest quality. This is a key part

our domestic and export operations, which we expect

in sustainability as well, since nonworking equipment

to be ready by 2020. The platform will allow clients to

becomes just more waste. The equipment manufacturers

analyze inventory levels and order online. For international

we work with are also using recyclable packaging solutions

clients, it will help to see purchases in US dollars and check

for their products and we are following their example.

product availability. Q: What potential clients would you like to attract? Regarding our offering, we launched a new product

A: Our client profile depends heavily on where our new

catalogue with around 1,000 new products in February

commercial branches will be located. In Guadalajara, we

2019. We have organized an intense marketing campaign

focus on pharmaceutical companies, veterinary companies,

to position El Crisol as a supplier for laboratories in the

the food and beverages industry and also the automotive

pharmaceutical, petrochemical, mining and educational

industry. The Torreon office will focus on the mining and

sectors, to name a few. Throughout 2019, we expect

metal-mechanics industries, food and beverages and also

to continue positioning the brand as the leader in lab

water treatment facilities. In Merida, we believe the food and

equipment in Mexico. The year will be challenging due to

beverages industry, as well as water treatment facilities, will

new NOMs being implemented but El Crisol has confidence

offer a significant opportunity. The research arena is also an

in the industry and will continue investing in Mexico.

interesting market, since many research facilities, such as the Scientific Research Center of Yucatan (CICY), CINVESTAV

Q: What trends will impact the medical devices sector in

and UNAM’s research centers, are located in the area.

the coming years?

Teaching activities will also be a strong commercial focus

A: Though nanotechnology has been used in medical

for all our branches.

devices for some years now, I believe the industry will continue advancing in this direction. Making devices smaller and easier to manage and operate is a must. However,

El Crisol is a Mexican company with 57 years of experience in

there will also be a move toward making medical devices

the commercialization and distribution of laboratory equipment

environmentally sustainable. This is part of the social and

for different industries. It has offices in Mexico City, Puebla,

environmental responsibility that new generations are

Queretaro, San Luis Potosi and Monterrey, among others

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COLD CHAIN A GROWING PRIORITY FOR LIFE SCIENCES EDUARDO TAPIA Director of Life Science and Healthcare at DHL

206

Q: How does DHL improve its clients’ supply chains in the

Q: How is DHL supporting Mexican hospitals to manage

life sciences sector?

their own logistics?

A: DHL invests in the generation of solutions specific to

A: DHL provides logistics services to a major hospital in

our client’s needs. The company analyzes its clients’ supply

Mexico. In this case, we receive, administer and redistribute

chains to identify areas that can be improved in terms of

the products from many medical device suppliers,

efficiency or service. Our goal is to find ways to add value

improving the hospital’s inventory processes. We are

to their supply chain and to work together with clients

seeing an increasing number of hospitals willing to partner

to develop better strategies to deliver the medication or

with logistics operators to take advantage of the latter’s

medical device to the patient. For instance, some clients in

platforms, systems, infrastructure and experience.

Mexico have asked us for strategies to reach their diabetic patients faster. In these cases, we are improving and

Q: How does DHL offer added value to manufacturers of

developing e-commerce platforms that allow us to deliver

biotechnological products and APIs?

the medication as soon as the diabetic patient needs it.

A: The market for biotechnological products has grown significantly in Mexico and all these players look for logistics

DHL Supply Chain Mexico has 100,000m 2 exclusively

companies that offer solid controlled-temperature solutions.

adapted for pharmaceutical products and medical devices.

These clients know that DHL already has experience in the

The company has over 20 years of experience in this

management of these products. We provide clients with the

sector, through which it gained significant knowledge

entire solution and equipment they need to safely transport

in the pharmaceutical, medical devices, diagnostics and

the product to the patient.

animal health. Mexico is the seventh-largest market for DHL Supply Chain’s pharmaceutical division. We have

Q: What are the three main goals for the life sciences

over 60,000m with controlled temperature, which is

division and your growth expectations for the coming year?

essential for the pharmaceutical sector. We ensure that

A: We will continue growing alongside our clients. We are

these rooms adhere to the highest standards of quality

already strong in the sector but we want to strengthen our

thanks to the almost 1,000 employees that specialize in

medical devices division and create more alliances with local

the life sciences area.

manufacturers. In the past couple years, we have focused

on animal health, for which we now have solid operations. Q: What investments has DHL Supply Chain made to continue improving its services for the life sciences sector?

During 2018, we increased our investment in the life

A: In 2018, we developed areas in our warehouses to wash

sciences sector by 70 percent, especially to strengthen

surgical instruments. These areas, which are located in

our cold-chain capabilities. We will continue investing in

warehouses close to hospitals, receive medical devices

infrastructure and training and continue improving our

and washing them so doctors can use them right away.

processes for the proper handling of medications. We

Our objective is to help clients take advantage of the

will also invest in the development of platforms to allow

infrastructure capabilities of a logistics operator to bring

us to have a greater amount of real-time information

products closer to customers.

with which to make decisions. We are investing heavily in IoT principles, which will allow us to provide more information to clients on the status of their products on

DHL is an integrated logistics company founded in 1969 in San

the road. We can also provide them with a comprehensive

Francisco. In 2002 it became part of the Deutsche Post Group.

analysis of their logistics and commercial strategy. This

It offers logistic solutions for the life sciences and healthcare

information will allow clients to make better-informed

sector through transportation, products and solutions services

decisions.

VIEW FROM THE TOP |

URGENCY A MUST IN HEALTH LOGISTICS ERIC DELGADO Director General of Grupo Sicamsa

Q: Grupo Sicamsa is 100 percent focused on pharmaceutical

restaurants and instead focus on the airport infrastructure.

logistics. How does this approach benefit your clients?

The Mexico City International Airport (AICM) is built to sell

A: Grupo Sicamsa’s approach to health logistics is to handle

things to people. There was a project a couple of years ago

deliveries based on the time and day the customer needs

that aimed to solve this problem but it was not completed.

it and not according to our own handling times. The health

The idea was to remove the hangar area in front of Terminal

sector requires available logistics services at any time and

1 to extend track 5 500m to the right, which would allow

day because people’s health cannot wait. Grupo Sicamsa

the airport to have simultaneous clearings and landings. This

works seven days a week, 365 days a year and it can reach

expansion could double the airport’s capacity and make it

any destination, from state capitals to secondary cities and

comply with international standards. It would also help to

municipalities. When Grupo Sicamsa works with a client, it

provide 24/7 transportation services for people who need

offers an integral solution that leads to companies growing

to move from one terminal to the other. Increasing AICM’s

their reach and business volume thanks to our availability and

operating hours to fulfill a 24/7 service would mean that

capabilities. As a result, some of our clients have grown in

airlines would not have to not pay for service extensions and

secondary and tertiary cities just as much as in primary cities.

consequently improve flight prices for passengers.

The company works with the 30 percent of the market that

Q: How could the government establish fair competition that

large companies neglect. In the public sector, Grupo Sicamsa is

allows small and medium-sized logistics operators to boost

bidding on a tender for epidemiological logistics for IMSS and

their market share?

on another with the National Blood Transfusion Center that

A: The conditions established by government dependencies

has been our client for over five years. In the private sector,

should promote fair competition among all companies within

Grupo Sicamsa handles 80 percent of Laboratorio Médico

the logistics ecosystem. However, there are many cases of

Polanco’s requests. Its other clients include Laboratorios

unfair competition that are neither monitored nor punished.

Médica Sur, Laboratorios Ruiz, Hospital Ángeles and Hospital

It would be good, in addition to López Obrador fighting

Universitario.

corruption, to also focus on providing fair and transparent conditions for all companies. International logistic operators

Grupo Sicamsa recognized that companies and government

have many incentives and monopolize the market with small

dependencies were unsatisfied with the service offered by

and medium operators having no chance to compete. In

our competitors due to long delivery times, bureaucratic

other countries like the US, national logistics operators have

processes and inconsistent traceability of their packages. To

priority over their international counterparts to ensure the

counter this, we offer a simple, tailor-made, transparent and

country is protected against bioterrorism. The government

traceable process. If something happens and Grupo Sicamsa

could make big companies develop their own airlines and

cannot deliver in the expected time, it communicates with

small and medium operators could occupy the space that this

the client and looks for the best way to deliver the package

would open with third-party carriers. At the same time, airlines

as soon as possible. The entire process is transparent for

should be more open and flexible to distributing their cargo

the client. Also, Sicamsa’s philosophy is to consider all its

services and avoid giving over 90 percent of their space to

deliveries as if they were subject to a life-or-death outcome.

international companies.

Q: What infrastructure strategy at Mexico City’s International Airport could help boost the logistics sector in Mexico?

Grupo

A: One of the main issues is that individuals are treated

complementing its clients’ supply chain and ensuring the

like clients and not like passengers. Other airports around

correct collection, distribution and delivery of products at a

the world have a limited number of duty-free shops and

national and international scale

Sicamsa is

logistics

company

specialized

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EMERGING TECHNOLOGY WILL TRANSFORM INDUSTRY KARL MCDERMOTT Global Head of Business Development at Morpheus.Network

Q: As a developer of a supply chain platform based on

bowl. Technology allows the improvement of processes, not

blockchain tech, how would you describe the disruptive

by displacing people but by empowering them to create

nature of this technology?

an added value.

A: Blockchain has the same transformative power the 208

internet had in the early 1990s. Just like our lives changed

Q: How has your partnership with Cubic strengthened

thanks to the internet, processes will be revolutionized

your operations and what other alliances have you

through automation and blockchain implementations.

established to boost your position in the market?

This technology offers a unique way of connecting and

A: Cubic follows a warehousing-as-a-service business

storing data, so people can trust it is not hackable and it

model. The company is employing underutilized space

can be used to connect businesses. It is important to note,

at company warehouses and selling it to third parties

however, that the idea of a universal registry of information

that need to grow their operations. Especially in Mexico

for business is actually referred to as distributed ledger

City, there is a need for warehousing space because no

technology (DLT). Blockchain refers more to crypto science

new facilities are being built. Cubic took advantage of

and dealing with investments, while DLT seeks to apply a

this need to build a solution that could help both clients

similar methodology to improve corporate processes.

and those companies with extra space at their facilities. Aside from Cubic, we have several global partnerships

Q: What opportunities can be found in supply chain

and collaborations to promote business transformation

optimization?

through DLT implementations. We are connected with

A: The pharma industry faces the challenge of rapidly

1,600 banks through the SWIFT network and we have

growing operations. Although the general industry is

alliances with 100 carriers. We are members of the Trusted

growing at a 6 percent rate, cold chain operations are

IoT Alliance along with companies like Bosch and Cisco

increasing at a 12 percent rate. In this sector, we are trying

and we participate in the Blockchain in Transport Alliance

to implement a safe and secure supply chain that ensures

and in the Enterprise Ethereum Alliance. All three of

products are transported from the manufacturerâ&#x20AC;&#x2122;s facilities

these alliances are international forums where innovative

to the end customer, be it a hospital or a pharmacy, by a

companies try to set fixed standards regarding new

3PL or transportation company that measures and controls

technologies that other companies can adopt.

temperature at all stages of the process. Q: What are your growth expectations for Morpheus. Q: How would you rate Mexicoâ&#x20AC;&#x2122;s position as a logistics hub?

Network and what role will Mexico play in your

A: From a global perspective, the way Mexico interacts in a

development strategy?

global supply chain is not so different from what happens

A: In 2018, we globally focused on developing experience

in other countries like Russia, Canada, the US or Argentina.

in sectors such as automotive, pharma and the food

The biggest area of opportunity to improve logistics

chain. For 2019, we are looking at strengthening our

processes in Mexico is to focus on activities where there

offering for exports and industries like oil and gas. The

is human intervention. Since there is a huge talent pool in

first six months of the year will be dedicated to building

the country, at times there are too many hands on the same

our platform, while the following will focus on creating a revenue-generating model by testing our solution and building a commercial strategy. We are also working on a

Morpheus.Network is a global developer of a full-service supply

beta program called Morpheus.Ambassadors where early

chain platform based on blockchain technology and an integrated

DLT adopters can register to become official promoters

cryptocurrency payment system. The company has partnerships

of our solutions. We have partners in Mexico, Argentina,

with leading software developers and global carriers

Russia, Holland, Australia and even Nigeria.

INSIGHT |

TAILOR-MADE LOGISTICS FOR THE PHARMACEUTICAL INDUSTRY AT A COMPETITIVE COST FRANCISCO CRUZ Director of Hubble Logistics México

The complex pharmaceutical supply chain can be a

costs are not only hit by inflation but also constant increases

challenge for inexperienced logistics operators, which in

in fuel prices, rising tolls, maintenance and insurance policies.

turn can lead to higher operational costs, says Francisco

Contracts and fares with clients are negotiated on a year

Cruz, Director of Hubble Logistics México, which banks on

basis and any unexpected operational expense such as fuel

its historical ties to give it an advantage. “Providing services

surcharge has to be absorbed by the operator.” As a logistics

tailored to the demands of the pharmaceutical industry is

company based in Mexico City, traffic jams are another

not easy, laboratories battle to find 3PLs that will follow

significant issue. “Traffic jams in large cities put pressure

the sector’s standards to the letter at a competitive cost,”

on the transport system, generating logistic problems for

he says. “Hubble Logistics was built on the foundations of

those working within these urban centers.”

an older family company from which we gained significant experience and strategic alliances.”

Cruz explains that the transportation industry in Mexico faces big challenges such as insecurity, high taxes,

Hubble Logistics, launched in 2014, is a Mexican logistics

transport fleet renovation and high fuel prices. “I believe

operator specializing in the pharmaceutical industry. Cruz

the sector could use some governmental incentives for

says success in the sector is determined by quality of delivery.

small and medium companies. Tax breaks could work as

“For a retail company distribution is key, especially for the

an escape valve, since many expenses that are essential

pharmaceutical industry where some products demand

for the operation add in costs and are nontax deductible;

specific conditions in order to preserve their properties

this could also impact on employment generation.” To

during distribution.” He adds that Hubble Logistics’ function

address this matter, Hubble Logistics is an associate of the

is to become an extension of the laboratory for the proper

Consejo Nacional de Ejecutivos en Logística y Cadena de

management and conservation of inputs in both operational

Suministro (ConaLog), a nonprofit organization seeking

and normative aspects.

to boost integration, development and competitiveness within the logistic community in Mexico.

Compliance with existing regulations is another key to success, including NOM-059, which dictates the set of

Insecurity in Mexico is a particular threat that the company

measures that must be adopted in a systematic manner,

takes seriously, employing security elements during

in order to guarantee that medicines have the quality

transportation and maintaining good communications

required for the use to which they are intended. “Our

with the police. “Our fleet is equipped with several security

fleet incorporates temperature monitoring systems to

mechanisms and we also train our staff in safety protocols

demonstrate that the cold chain is being maintained

which allow them to react properly against danger

throughout the trip,” Cruz says.

situations. We are also allied with local and federal police to monitor the status of the vehicles in case a situation

Hubble Logistics initially provided services for Grupo

presents itself.”

Neolpharma but now works with many other laboratories, including Grupo Valeant, Bausch Health México, Laboratorios

Since its launch, Hubble Logistics has done well in Mexico’s

Andrómaco and Medix. It transports both raw materials and

pharmaceutical market. It grew by 35 percent in 2018 in

finished products to pharmaceutical companies, hospitals,

terms of volume of deliveries and expects 30 percent

pharmacies, medical representatives and distribution

growth in 2019 due to market opportunities. “Mexico

centers. The company delivers mainly in central and south

produces around 2 billion units of medicine per year; 10

east Mexico but has the capacity to work across the country.

percent of these medications expire in the same year of

However, farther destinations are becoming more expensive

distribution due to displacement problems in the national

due to the increase in tolls and fuel prices. “Our operational

territory,” Cruz says.

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| INSIGHT

PUBLIC SECTOR A GREENFIELD FOR LOGISTICS SERVICES ALESIO BERECIARTU Commercial Director of the Healthcare Business Unit Latin America at OCASA

210

The size and complexity of the Mexican public health

For Bereciartu, OCASA’s success lies not only in its expertise

system offers a significant opportunity for technology and

but also in its human capital. “Most of our personnel comes

know-how transfer from players in the private sector, says

from the pharmaceutical industry and we train all our

Alesio Bereciartu, Commercial Director of the Healthcare

collaborators in the same processes and standards as any

Business Unit Latin America at OCASA. “The Mexican public

other player in the pharma industry. We have implemented all

health sector is in need of better logistics services and could

the procedures and protocols needed and have standardized

greatly benefit from the transfer of technology, quality and

all our services and processes in all regions where we

know-how coming from the private to the public sector.”

are present.” Thanks to this approach, the company has succeeded when competing for critical logistics tasks against

OCASA, an Argentinian company with more than 35

other logistics providers in the health sector. “Many important

years of experience in the market and presence in the

laboratories trust their high-volume samples to larger

US, Europe, India and Latin America, provides solutions

companies but depend on us to manage clinical research

for e-commerce and general logistics, but has developed

samples that require more detailed attention,” he says.

significant expertise in the health segment. “We understand the particular logistics needs of the health industry. We

While expertise is one of OCASA’s success drivers,

have the speed that the pharmaceutical industry requires,

Bereciartu says technology also plays a key role when

as well as the needed expertise to support clinical research

ensuring that every client requirement is met on time and

and other types of activities.”

effectively. “We have a control center that keeps tabs on all our vehicles and units and that can detect any anomaly or

OCASA’s expertise translates to the three business lines in

delay in the delivery of the products.” Its automated online

which the company has ventured within the health sector.

platform also allows OCASA to manage all information

One is the collection of biological samples for clinical trials in

regarding shipments and cargo with low margins of errors,

Latin American countries to be shipped to central labs, mostly

says Bereciartu. “We have to constantly adapt and update

in the US. “We have developed an operational structure for

our system to make it more precise and more robust. It is

sample collection from several Latin American countries that

what the market demands.”

are mostly used for clinical trials. Almost 80 percent of the samples collected go to the US and the rest are sent to cities

Although Mexico has been receptive to OCASA’s

like Mexico City or Buenos Aires,” says Bereciartu.

commercial offering, Bereciartu says the country has a series of complexities and particularities that have made the

Another business niche in which OCASA participates

company’s tasks challenging at times. “Infrastructure and

is logistics for hospitals and clinics, although Bereciartu

security are important topics for us. In many regions where

says that in Mexico, the company is still growing its

there are neither resources nor infrastructure, it is a big

participation to what it has in other countries. “It is hard

challenge to have an operation that flows easily. Sometimes,

to make a comparison with other countries, since we

it is also hard to find people available to perform last-

have different commercial strategies, according to the

mile deliveries in these places,” he says. When it comes

particular conditions of each country. We have a stronger

to regulatory conditions, Bereciartu says the country’s

presence in this business niche in Argentina than in Mexico.

public institutions tend to be bureaucratic because of

However, this does not mean that our operations in Mexico

their size. Still, Mexico offers significant opportunity areas

are less important.” Bereciartu says OCASA’s offering is

for a company like OCASA. “The country has a growing

complemented by its third business line, which focuses on

population, along with a developed hospital infrastructure.

warehousing and distribution services for medical devices

Moreover, its health system allows the participation of third-

companies.

party players for certain tasks,” he says.

INSIGHT |

MINIMIZING RISK THROUGH PROPER DEVICE ACQUISITION, SELECTION ILDEFONSO VÁZQUEZ President of IVG Group

Companies in the life sciences industry, such as

Customization by Cleverism. To meet these expectations,

pharmaceuticals, clinical laboratories and others, are faced

IVG Group focuses on two primary strategies: purchasing

with the task of choosing the most appropriate medical

advice and support from the different companies in the

devices to ensure high-quality patient care, efficiency in

group. “IVG Group has experts in the different areas in which

research and development processes and overall scientific

we participate to provide support to clients in a specialized

and technological competitiveness. “Choosing the wrong

and effective manner,” says Vázquez. “The experience and

device can generate economic losses, but the most serious

services of the companies within the group contribute to the

thing is that it can impact the final consumer: the patient,”

solutions we provide to each of our customers.”

says Ildefonso Vázquez, President of Grupo IVG. For example, if a pharmaceutical company is looking for When customized solutions are developed, it is possible

laboratory equipment, one or more of the companies

to satisfy the needs of different types of companies and

in IVG Group can participate in creating an added-value

more importantly, minimize and eliminate the risk associated

solution. “In these cases, IVG Comercializadora is in charge

with the management of medical devices. “Customers not

of finding the right device, while DEBBIOM participates

only choose equipment because of the brand but because

with its knowledge in biochemistry and bioavailability in

of the applications and solutions they can cover with that

the national market,” says Vázquez. IVG Group also advises

solution,” says Vazquez.

the customer when purchasing any product. “Besides letting customers test the devices before buying them, IVG Group

IVG Group offers its clients complementary services to

is responsible for training the company’s staff in the proper

get to know laboratory and analysis equipment before

use of the equipment and reagents and provides continuous

buying it. “Although the equipment is not tailor-made, our

aftersales support,” he says. “In the end, our group not

comprehensive services allow the equipment to be adapted

only sells equipment and offers services, but it assists

to meet the client’s needs,” says Vázquez. Customizing a

companies in the selection and acquisition of appropriate

product to the needs of a certain group can take mass

devices for specific procedures. It also aids these companies

production to another level and even lower the per-unit

throughout the frequently troublesome process of getting

cost for the customer, according to a Report on Mass

used to actually operating the equipment.”

Liomont blister machine

211

INMEGEN, Mexico City

TALENT & BUSINESS DEVELOPMENT

Among the many challenges the healthcare sector faces, there is a growing need for trained professionals. Most health professionals are found in the countryâ&#x20AC;&#x2122;s most-developed states, including Mexico City, Jalisco and Nuevo Leon, while lessdeveloped states face staff shortages to cover patientsâ&#x20AC;&#x2122; demands. Properly training talent requires combined efforts from multiple fronts, including universities, the government, recruiters and the industry. All participants must identify exactly where the gaps are and what programs are best suited to generate the needed skills for a specific region.

This chapter provides an overview of the talent deficit in terms of both skills and numbers faced by the healthcare sector and how industry entities are working to address this issue. Universities, institutions and education-related companies also share their perspective on the glaring deficits in healthcare education plans and what mechanisms that could help to improve the sectorâ&#x20AC;&#x2122;s talent development.

213

CHAPTER 10: TALENT & BUSINESS DEVELOPMENT

216

VIEW FROM THE TOP: German Fajardo, UNAM

217

VIEW FROM THE TOP: José Mustre De León, CINVESTAV

218

TECHNOLOGY SPOTLIGHT: Dräger: Lung Protection and Ventilation Strategy

220

VIEW FROM THE TOP: Eduardo García Luna, UDEM

221

INSIGHT: Tomás Barrientos, Anáhuac University

222

VIEW FROM THE TOP: Miguel Ángel Celis, INNN

223

VIEW FROM THE TOP: Abelardo Meneses, INCan

224

PROJECT SPOTLIGHT: Centro Médico Puerta de Hierro: an Enduring Alliance

226

VIEW FROM THE TOP: Herbert Bravo, SOMIB

227

VIEW FROM THE TOP: Luis Alonso Herrera, INMEGEN

228

INSIGHT: Gregorio Quintero, SMEO

229

INSIGHT: Pedro Gutiérrez-Fajardo, ANCAM

230

INSIGHT: Gabriel Alvarado, KRONOS

231

VIEW FROM THE TOP: Pedro Vera, Intersistemas

232

VIEW FROM THE TOP: Fausto Hernández, VALID

233

INSIGHT: Guillermo Bilbao, PA Consulting Mexico

235

ROUNDTABLE: How are You Contributing to Addressing the Need for Doctors and Specialists?

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| VIEW FROM THE TOP

CLOSE COLLABORATION FOR IMPROVED HEALTHCARE ACCESS GERMAN FAJARDO Director of the UNAM School of Health Sciences

216

Q: What kind of health professional does UNAM’s School of

Q: What is the best strategy for an academic-industrial alliance

Health Sciences aim to graduate?

to ensure proper talent training to meet the challenges of a

A: UNAM seeks to graduate students who can become good

growing and rapidly changing health landscape?

general physicians and who can enter a graduate program or

A: A continuous, solid collaboration between industry and

focus on a specialty in the near future. However, due to the

academia is necessary to ensure both sides are aware of how

diversity of majors the school offers, there is no unique profile

many doctors the country requires, what type of specialists

of graduates. For example, professionals graduated from the

and where they should be posted. Universities should have

Basic Biomedical Research program will most likely dedicate

closer communication with the Ministry of Labor and Social

their life to research and will move toward graduate studies.

Security (STPS), the Ministry of Health and the key industry

Meanwhile, someone majoring in Forensic Sciences will be

players that participate in developing Mexico’s human capital.

more likely to contribute to Mexico’s public safety. Also, UNAM

At the moment, the School of Health Sciences prioritizes

offers a Plan of Combined Studies in Medicine, Bachelor’s and

its alliances with health sector authorities, rather than with

Doctorate (PECEM), which allows students to complete their

the industry. Our goal is to change that in the short to

undergraduate studies in six years and start with a Ph.D. in

medium term to provide students with better employment

their second year. PECEM allows students to complete their

opportunities in their fields.

major and a doctorate in medicine in 10 years. Q: How can UNAM collaborate in promoting a preventive Q: Former Minister of Health Armando Ahued says the lack

health model?

of specialists in Mexico is an ongoing problem. How are

A: Each federal administration modifies the National Health

universities addressing this issue?

Plan every six years and always emphasizes primary care.

A: Rather than a lack of specialists, I think doctors are badly

The main problem with most approaches is that they try

distributed. On average, there are two to three doctors per

to implement a health model mostly focused on the center

1,000 inhabitants. However, in cases like Mexico City, the

of the country. Instead, there should be proper incentives,

concentration of doctors can be three times higher than in

training and benefits for all health professionals across the

other regions.

country. People also must get used to going to the doctor for prevention and check-ups and not only for healing and

This disparity should be addressed not only by universities

treatment. This requires an effort from all players in the sector

but also through the National Health System. Around 8,000

to change the paradigms of medical attention and lifestyle.

doctors graduate from a specialty in Mexico every year but the available university placements are determined based

Q: What are UNAM’s Health of Science Faculty’s main

on the vacancies in hospitals instead of the actual needs

achievements?

of the national population. Ideally, the government should

A: Our most recent achievement was the approval of a new

have a way of organizing the country’s local and national

major in nutrition by the faculty’s technical council. The faculty

health needs to have a clear idea of how many doctors and

believes this program will be key to counter the high level of

specialists are required by state, which would make it easier

obesity in Mexico through its focus on research and public

to distribute them.

policy. The faculty will also receive a new PET/CT machine in May 2019, which will be the most modern in the country and will be available to the entire Mexican population. In the

The National Autonomous University of Mexico (UNAM) is the

coming months, the faculty will also open a unit for electron

largest and most important public university in Mexico and Latin

microscopy, with three state-of-the-art microscopes available

America. The Health Sciences School offers programs in areas

to anyone who requires it, both at the university and in

such as forensic sciences and physiotherapy

the country.

VIEW FROM THE TOP |

BASIC RESEARCH A PILLAR FOR HEALTHCARE JOSÉ MUSTRE DE LEÓN Director General of CINVESTAV

Q: How can greater investment in research change the

working with Neolpharma in the development of two new

local healthcare sector?

medications. However, our relationship with these players

A: Basic research is essential for the development

could be stronger.

of many economic sectors but it is often discounted because its effects are not seen immediately. However,

Q: How can public research help alleviate Mexico’s

delaying investment in basic research will lead us to

epidemiological burden?

fall behind other economies and might worsen current

A: A research group at CINVESTAV’s Genomics Center in

healthcare problems or create new ones. CINVESTAV has

Irapuato is studying genomic traits in ancestry to identify

tried to maintain a constant investment flow in research

genetic markers that make Mexicans prone to certain

and even to compensate for the lost resources that were

diseases. Mexicans have a mixture of South European and

once given to us by the federal government. We do not

indigenous ancestry, so treatments developed for other

want any of our research projects to stop.

populations may affect Mexicans differently. This research group has the largest genomic database of indigenous

Q: How is CINVESTAV directly contributing to the

American population, from Canada to Argentina, in the

improvement of healthcare in Mexico?

world. Due to the size of this project, federal funding

A: We have two key projects. The first has a strong social

was insufficient so it is also being funded by England

impact in that it focuses on the development of a vaccine

and the EU.

for Chagas disease, which is not a priority for developed economies. This project has received an annual stipend

Q: What is the status of CINVESTAV’s Center for

from the Carlos Slim Foundation of MX$10 million

Aging Research?

(US$52,604) for the past four years, which the company

A: In 2018, we finalized the construction of the center and

just renewed for the coming four years. We are close to

we are now working to obtain all necessary certifications.

clinical trials and continuing this project is essential for

The center has allied with several international institutes,

the population.

including the University of Barcelona and the Max Planck Institute for Biology of Aging. However, the Center for

The second project focuses on several analgesic properties

Aging Research is being financed by a joint fund between

of stem cells. In March 2019, we signed an agreement with

Mexico City and CONACYT and the latter is reconsidering

a South Korean company to commercialize these cells

several projects that it had supported in previous years,

and cell growth factors in the Asian country for analgesic

so we are uncertain whether they will continue to fund

and dermatological purposes.

the center.

How

has

C I N V E S TAV ’ s

relationship

with

Our goal for 2019 is to finish the Center for Aging

pharmaceutical companies evolved?

Research’s certification processes, to focus on the

A: We need a strong collaboration with other players

commercial aspects of the stem cell project and to lead

to ensure researchers have direct contact with the

our research projects into the creation of commercial

immediate medical needs of the population. CINVESTAV

solutions.

achieves this through several associations with public and private hospitals, which we aim to reinforce. Many of our graduates are already working in the healthcare

The Center for Research and Advanced Studies (CINVESTAV)

sector and in hospitals within the Ministry of Health’s

is a Mexican public institution dedicated to the development of

network. Alliances with pharmaceutical companies are

science, technology and education at the graduate level. Up to

extremely important for the center. For instance, we are

30 percent of CINVESTAV’s research is in the healthcare sector

217

| TECHNOLOGY SPOTLIGHT

218

DRÄGER: LUNG PROTECTION AND VENTILATION STRATEGY Dräger has released v.1.12 of the PulmoVista 500® TIE (electrical impedance tomography) software with which it incorporates new lung viewing options that facilitate ventilation and lung protection. With PulmoVista 500®, health professionals can visualize regional distribution of air in the lungs non-invasively, in real time and from the head. Among its benefits, PulmoVista 500® offers complete visualization of the ventilation cycle in real time. It allows users to observe the cycle continuously and directly in various lung regions, which facilitates the development of personalized treatment. The system can also achieve a ventilation strategy that provides lung protection, optimal adjustments of PEEP and tidal volume. PulmoVista 500® allows an evaluation of the regional ventilation distribution and the changes that occur in the lung volumes at the end of expiration. The user can see the effects of therapeutic maneuvers and monitor results over time. With this information, health professionals can determine the best possible distribution of air in the lungs and remain informed about the effects that certain disorders, such as atelectasis, hyperdistention, air trapping, pleural effusion or ventilation, may have on breathing. Users of PulmoVista 500® can monitor lung function for up to 24 hours straight, directly at the patient’s bedside. To do this, a flexible silicone belt with 16 electrodes around the patient’s chest is easily placed and connected to the system to avoid invasive or stressful maneuvers, ionizing radiation or having to transfer the patient to another specialized room.

PulmoVista 500® allows lung function monitoring for 24 hours straight PulmoVista 500® also generates regional and global impedance parameters and curves in real time. It provides a view of the trends of ventilation distribution and changes in lung volumes at the end of expiration, which allows the user to compare the current state of the lungs with historical data. Its Diagnostic view facilitates a practical analysis of the distribution of ventilation, changes in regional distensibility (CW, CL) and delays in regional ventilation (RVD), so it is especially useful when evaluating therapeutic interventions, such as PEEP tests.

219

| VIEW FROM THE TOP

COLLABORATION WILL ELUCIDATE THE FUTURE OF HEALTH EDUARDO GARCÍA LUNA Vice Chancellor of Health Sciences at UDEM

220

Q: What is the mission of UDEM’s health program?

Using the knowledge and tools from each field allows

A: We offer a wide range of health-related programs,

us to attack a problem from many different sides.

including medicine, odontology, nutrition, psychology

Personalized medicine provides a good example of how

and nursing. Our vision is to graduate professionals who

a multidisciplinary approach can be used. We factor in

can adapt to continuous change in their field. UDEM

many aspects of an individual’s life and determine the

graduates should be up to date with every development

potentials risks when making a diagnosis.

and be able to learn and unlearn things. At the same time, they should gain the skills to treat patients in a

In the field of pharmacology, there is a shift toward

professional and respectful manner. These values are

creating medications and treatments that are more

applicable to every single discipline in this field.

specified to the individual and their particular health profile. This is aided by our increasing knowledge

Q: How is UDEM adapting to Mexico’s changing

regarding genetics and how that is enriching our ability

demographics?

to predict health risks.

A: We offer specializations focused on elderly people, like geriatric medicine and gerontological psychology.

Q: What alliances do you have with other institutions to

We also adapt to current developments by updating our

confront future health challenges?

programs. Demographic changes and environmental

A: We have strong links with both the public and private

factors have had a significant impact on the current

sector. Our relationships range from educational programs

state of health. Some illnesses have become much more

to internships for our students. A major highlight of this

common and we may start seeing completely new ones

collaboration is Polaris HealthTech Center. We founded

in the future. Illnesses related to diet, environmental

this together with Sistema de Salud Christus Muguerza

contamination and chronic stress are characteristic of

and the technology entity Skye Group with the aim

these times. We have yet to develop all the tools to

of creating a growing space for health startups. This

confront these challenges because understanding what

project is part of the goal to make Nuevo Leon a hub for

causes these ailments is not just a question of biology;

health tech.

causes are cultural, social and economic too. This also applies to how each person experiences their sickness.

This center can offer support in many different ways, not

How do they deal with it emotionally and where do

just bringing together expertise but also with elements

they find support? In this context, an individual’s social

such as financing and logistical support. Our goal is to

situation is very relevant.

confront major issues that affect large portions of the population. We believe a strong focus on technology is the

Q: How do you intend to tackle the increasing complexity

only way we can prepare for the challenges of the future.

of diseases? A: It is important to take a multidisciplinary view that

Q: How do you foresee your health programs evolving?

brings together different fields. This is reflected in the

A: We need to be continuously evolving, visualizing what

wide range of programs we offer at our university.

health could look like in the future. Who knows what hospitals will look like in the future? Will they be bigger or smaller? Evolution means taking a wider picture of health

The University of Monterrey (UDEM) is a private educational

that includes education and prevention, while we continue

institution accredited by the Southern Association of Colleges

to build networks between institutions and professionals.

and Schools Commission on Colleges. It participated in the

The more parties involved, both nationally and globally,

creation of the health startup incubator Polaris HealthTech Center

the more we can achieve.

INSIGHT |

PYMESAS, THE LINK BETWEEN ACADEMIA AND BUSINESS OPPORTUNITIES TOMÁS BARRIENTOS Director of the School of Health Sciences at Anáhuac University

Smaller companies could hold the key to universal

The opportunities that Anáhuac University has recognized

healthcare access, says Tomás Barrientos, Director of the

based on studies and analyses of SMEs in the health sciences

Faculty of Health Sciences at Anáhuac University, which is

are diverse. “These include 19 academic areas but we found

developing a project to address the issue. “We want SMEs

that primary care, nutrition, dentistry, physical therapy and

to act as providers of services that are indispensable to the

nursing occupy the top places,” says Barrientos. The university

National Health System and at the same time help society

plans to use PYMESAS to develop projects with business

to implement a new concept of health services to combat

models that contribute holistically to the health needs of the

some of the flaws in the system,” he says.

population.

The program, in cooperation with the Direction and

According to CONDUSEF, SMEs generate 72 percent of

Administration of Health Institutions (DAIS), seeks to

employment and 52 percent of Mexico’s GDP. Innovative

develop Small and Medium-sized Associated Health

SMEs can contribute in those areas where the government

Companies (PYMESAS) that also contribute to improving

and large companies have come up short. “SMEs can fill the

the employability of the faculty’s students. “Anahuac

social gap and encourage the creation of new associations

University wants to maximize our students’ employment

that introduce technologies and assistance services to the

opportunities through the Anáhuac University Health

field of healthcare in the areas of Primary Health Care (PHC)

System (SUSA) and PYMESAS,” says Barrientos. The

and Advanced Health Care (AAS),” Barrientos says.

project is supported by the university’s business incubator in collaboration with the Anáhuac Business

However, the goal is not only to increase universal access

Development Institute (IDEA) and its business accelerator

to services but also to create a network of companies that

IDEARSE-Anáhuac.

contribute to Anáhuac University’s health mission. “The project envisions that the specialized PYMESAS created

The ecosystem to support the development of health-

through the incubator and accelerator have a permanent link

oriented SMEs, according to Barrientos’ book David and

with the SUSA to provide advice and supervision of business

Goliath, is the SUSA. In the book’s biblical metaphor,

plans and operations,” says Barrientos.

David represents Anáhuac University’s efforts to bring health closer to the population and Goliath represents the

The university also has implemented a strategic plan to

obstacles facing the health system in Mexico.

achieve its health access targets. In 2018, according to the Diagnostic Study of the Right to Health by CONEVAL, around

Barrientos explains that “SUSA aims to link the faculty

19.1 million people in Mexico do not have access to health

with business institutions in the field of health — national

services. INEGI’s 2015 survey revealed that most affiliates were

and international, public and private — as a strategy

concentrated in the Seguro Popular (a terminated entity)

to promote opportunities for graduates to put their

with 49.9 percent, followed by IMSS with 39.2 percent. The

knowledge into practice, generate employment sources

government has made universal access a priority.

and give back to society.” He continues: “SUSA wants to strengthen the weakness of the health system with good

“The strategic lines of the 2016-2020 strategy are based on

people and SMEs.”

seven main points that seek to strengthen the comprehensive education of the student, its integration with the Anáhuac

Each year, 350-400 students graduate from the Faculty

community, strategic linkage with the productive and social

of Health Sciences at Anáhuac University, which is among

sectors, internationalization and research with social impact

the Top 3 universities in Mexico, according to the QS World

to develop the student, as well as increase healthcare access,”

University Rankings 2019.

says Barrientos.

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| VIEW FROM THE TOP

GREATER ATTENTION NEEDED FOR MENTAL DISEASES IN ALL AGES MIGUEL ÁNGEL CELIS Director of INNN

Q: What are the main neurological diseases affecting the

most common disease worldwide and causes the

Mexican population?

highest number of work absences. Depression reduces

A: Mexico’s healthcare system faces the challenge

productivity and leads people to withdraw from society.

of dealing with more complex diseases. The main

It also places a significant toll on families and society.

neurological ailments affecting Mexicans are related to

Depression sometimes even leads to suicide.

aging. Mexico’s population changed due to a smaller 222

number of births and a growing survival rate. During

Q: How is the institute contributing to the collective

the 1960s, life expectancy was 57 years. By 2016, life

knowledge regarding mental diseases?

expectancy had grown to 75.2 years thanks to better

A: The institute actively researches the many factors

sanitation and a decrease in child and maternal mortality.

influencing the aging process of the nervous system and the consequences of a slowdown in communication

Today, Mexico’s main mortality causes for adults over

among neurons. We are studying the long-term effects

60 years of age are related to cardiovascular diseases,

of air, water and soil pollution in neural networks and

which are heavily linked to strokes. For every three deaths

premature cell death, also known as apoptosis. The

from myocardial infarction, there is one from stroke.

institute also performs basic research and one of our main

Aging also causes cognitive deterioration and may lead

lines is autoimmune diseases, such as multiple sclerosis.

to mental diseases such as Alzheimer’s, a degenerative

When an infection occurs, the body generates antibodies

condition that will become increasingly common as

to fight it and information on the pathogen is stored by

the population ages. While not lethal, Alzheimer’s has

the immunological system. However, the system can make

significant repercussions for a patient’s and their family’s

mistakes and damage the host’s cells.

quality of life. Multiple sclerosis is the most non-traumatic disabling Epilepsy affects nearly 2 percent of the Mexican

disease affecting young adults. Moreover, we are seeing an

population. Its incidence and prevalence may be higher

increase in the prevalence of this disease. Pharmaceutical

than in well developed countries due to endemic

companies developed many treatments that control the

infections like neurocysticercosis, higher incidence of

disease, as there is no cure, but these medications are

injuries related to motor vehicle accidents and birth,

highly expensive and public health institutions are facing

as well as lack of access to appropriate diagnosis

a challenge in affording them.

and treatment. Epilepsy is also associated to physical and psychological comorbidities, affecting education

Q: Why should doctors choose the National Institute of

and working abilities. Poor control of the disease can

Neurology and Neurosurgery Manuel Velasco Suárez to

lead to premature deaths either by status epilepticus,

complete their specialization?

unintentional injuries or suicide.

A: The best neurologists in Mexico are trained at this one-of-a-kind institute. Doctors want to complete their

Meanwhile, the most common mental health disorder

specialization here as the institute has a large number

among young individuals is depression, which is the

of patients. We receive many interested doctors from both public and private institutions in Mexico and abroad. About 25 percent of our residents come from Central

The National Institute of Neurology and Neurosurgery

and South America. Our goal is to compete with the

Manuel Velasco Suárez (INNN) is a national health institute

best institutions in the US. Every year, 100 specialists in

managed by the Ministry of Health. It is located in Mexico

neurology, neurosurgery and psychiatry graduate from

City and provides care through innovation

the institute.

VIEW FROM THE TOP |

RISK FACTOR DETECTION A SHARED RESPONSIBILITY ABELARDO MENESES Director General of INCan

Q: How has the National Cancer Registry project advanced

such as breast cancer in the north and cervix cancer in

and what are its next steps?

the south. Colon cancer, meanwhile, is surging across

A: The National Cancer Registry was approved by all the

the country.

necessary parties and became part of the general Health Law in 2017. So far, we have implemented this registry in

When analyzing the factors that could be behind this

seven cities, including Merida, Campeche, La Paz, Tijuana,

distribution, we see that the eating habits and lifestyle of

Acapulco and Sonora. There are many factors that impact

people in the north are very similar to those in the US,

our decision on whether a city can be part of the registry.

while in the south we see there is less access to health

One is collaboration with the local government. We make it

services. Given these conditions, we have arrived at the

a priority to generate a link between the federal, state and

conclusion that cervix cancer is more associated with

municipal governments and the local Ministry of Health.

poverty and limited access to healthcare. Colon cancer, on

Since the health system is fragmented, we have to look

the other hand, is heavily linked to obesity and overweight.

for ways to foster collaboration between all the involved

Around 71 percent of the population in Mexico is obese or

institutions so there can be information exchange. The role

overweight, which is why we see colon cancer spiking in

of local health ministers is key as they are the ones who put

all states. Thyroid cancer has surged to fourth place and

us in touch with the directors of local IMSS, ISSSTE, army

is also associated with obesity. Lung cancer is the fifth-

and private hospitals.

most common cancer because of tabaco and exposure to wood smoke. Ovary cancer is also among the most

When a city is chosen to participate in the registry, it has

common cancers.

to provide all the information related to every cancer case it has registered and there has to be a follow-up to every

Q: How does INCan and MD Anderson collaborate in

diagnosed case. Afterward, the information is compared

cancer-related programs and what are the priorities of

with the information registered by INEGI regarding cancer

this collaboration?

mortality, so we can provide estimates regarding how many

A: We are a sister institution of MD Anderson. We share

new cases are appearing and the mortality in each city.

programs related to prevention, early diagnosis and public policies. We also have resident exchanges, which allow for

We always choose cities, rather than states, and those cities

training that can later be applied at INCan. However, we

must have the needed infrastructure for cancer treatment.

mostly collaborate in research. We established agreements

When cities do not have this, patients are diagnosed locally

with MD Anderson to replicate their studies so we can

but then leave to be treated in other places, so we lose

compare US and Mexico pathologies and share this

their follow-up. That is why we include cities that have all

experience. Our goal is to explore the causes of certain

the resources for patient management. Through constant

diseases in both countries and determine risk factors. For

follow-up, we can register the type of tumor, its localization

instance, in Anglo-Saxon countries, the percentage of

and we try to establish risk factors related to is appearance.

women under 40 years old with breast cancer is around 7

This helps us to understand whether cancer develops in the

percent, while in Mexico it is 15 percent. We want to know

same way throughout country and its response to certain

the reasons behind this variation.

factors, customs, eating habits and lifestyles. Q: What is the general cancer map in Mexico?

The National Cancer Institute (INCan) specializes in the

A: Cancer distribution remains more or less the same, with

treatment of different types of cancer. It is part of an integrated

a prevalence of breast, prostate and colon cancer. In certain

system of 12 hospitals that provide highly specialized services

states there are some cancer types that are above average,

and perform basic and clinical research

223

| PROJECT SPOTLIGHT

224

CENTRO MÉDICO PUERTA DE HIERRO: AN ENDURING ALLIANCE Centro Médico Puerta de Hierro joined Mayo Clinic Care Network in February 2019. This is a select group of autonomous healthcare providers working together to improve patient management for the benefit of society. With this new alliance, Centro Médico Puerta de Hierro’s medical community has timely access to evidence-based medical opinions on diagnosis and treatment alternatives from Mayo Clinic staff physicians. That way, patients secure high-quality healthcare at no additional cost. Centro Médico Puerta de Hierro became the first member of Mayo Clinic Care Network in western Mexico. Centro Médico Puerta de Hierro is a tertiary-care hospital group with five hospitals and other clinics in the Guadalajara metropolitan area and the states of Colima and Nayarit. These hospitals offer 30 specialties, including transplant surgery, cardiology and neurosurgery.

Centro Médico Puerta de Hierro is the only member of the Mayo Clinic Care Network in western Mexico Centro Médico Puerta de Hierro also has access to a specialized tool called Ask Mayo Expert. This is a database created by Mayo Clinic experts that integrates guidelines, treatment recommendations and patient referral systems for use where medical care is provided. It takes advantage of electronic consultations, known as e-Consults, which allow doctors to interact with Mayo Clinic specialists to get their opinion regarding specific cases. Mayo Clinic also provides electronic meetings or e-Boards. These are live video conferences that allow doctors to review and discuss the management of complex cases with a multidisciplinary team of Mayo Clinic specialists and other doctors around the world, affiliated to the Mayo Clinic Care Network. Patients at Centro Médico Puerta de Hierro enjoy the benefit of Mayo Clinic Care Network’s expertise. This network shares best practices among members in order to achieve clinical, operational and commercial objectives. Physicians and allied healthcare personnel are also able to access the Mayo Clinic Library, including all educational products, as well as opportunities for professional growth and programs for continuing medical education.

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| VIEW FROM THE TOP

HEALTH MINISTRY RECOGNITION ESSENTIAL FOR BIO ENGINEERS HERBERT BRAVO 226

President of SOMIB

Q: Which industries are seeing the greatest demand for biomedical engineers and what challenges do you face? A: Biomedical engineers are active in every industry. They have a strong presence in the hospital sector where they hold both executive and operational roles and many work for the government and the wider public sector. The last commissioner of Seguro Popular was trained in our field. There also are many biomedical engineers in commerce, particularly in businesses that produce medical devices. We also have a strong presence in academic research. In the hospital sector alone, there is demand for 3,000 biomedical engineers. There are now about 50 educational institutions in Mexico that offer a degree in biomedical engineering or similar programs. One problem is that the Ministry of Health does not yet recognize the profession as a category in the medical field. This is a barrier to more investment and expansion of educational programs. Private hospitals have strong networks of biomedical engineers but many public hospitals do not open up enough places for our professionals. Q: What are your goals for 2019 and 2020? A: The first step is to get the profession of biomedical engineer classified properly among medical professions by the Ministry of Health. This is essential to strengthen our participation and contributions in the field.

The Mexican Society of Biomedical Engineering (SOMIB) has contributed to the professional and scientific development of biomedical engineering since 1978. Today, it is the largest organization of biomedical engineers in Mexico and Latin America

VIEW FROM THE TOP |

BETTER KNOWLEDGE LEADS TO BETTER RESOURCE DISTRIBUTION LUIS ALONSO HERRERA Director General of INMEGEN

Q: How will your background as the Director of Research

assumes all individuals are equal. Results, therefore, are not

of INCan influence your work as head of INMEGEN?

proportional to the amount of resources spent. Allocating

A: At the institute, I was in charge of restructuring the

resources on high-risk groups can be much more effective.

research direction. I established priorities using research studies to better comprehend the state of cancer in Mexico.

Q: What first steps are you taking for this project?

At INMEGEN, we are conceiving a similar project with a

A: First, we have to build networks. We will start with other

broader focus. We want to examine the risk factors for

national health institutes focused on cancer, cardiology,

diseases among different population groups. To do this, we

neurology, psychiatry and public health. Except for the

need to collect information from all fields: clinical, genomic,

Institute of Public Health, they all treat patients and have

cultural and economic. We want to use all the available

a vast amount of epidemiological information. Afterward,

information and if it does not exist, we want to collect it, not

we can continue with other institutions, including private

just for cancer but for all chronic diseases that are a major

hospitals. We will then see how our sample evolves.

economic burden on Mexico’s health system. The initial participation of the industry is essential. All our Our country is huge and environmentally and culturally

projects must follow a strategic plan in economic terms.

diverse. Both factors significantly impact our epidemiology.

How is it going to be sustainable? Alliances with the private

Due to its ethnic diversity, the Mexican population displays

sector will be necessary. Private institutions can greatly

different genetic markers. At INMEGEN, we want to draw a

benefit from research too because they would learn about

picture that helps us better understand our health.

the health of their patients, employees or clients. The challenge will lie in maintaining continuity with the same

Q: How will you develop your sample group for this project?

groups of people so we follow their health evolution.

A: We are thinking of using captive populations of healthy people; for example, those who are working at particular

Q: How is INMEGEN raising awareness regarding the

companies. Through interviews and tests, we will probably

importance of genomic research?

encounter some people who have already developed certain

A: We have been working hard on communication. We

conditions. However, our goal is to find people who are at risk

have to show the worth of doing research and generating

of developing a disease in a few years. We will follow their

knowledge and demonstrate their impact on a patient’s

health over time. The government has implemented many

quality of life. Results can help us change our behaviors,

programs focused on timely detection, but many of them have

stimulate innovation and maximize the value of our

overlooked the wide range of variables we want to examine. It

resources in preventing expensive chronic conditions. The

will be an expensive and ambitious project, but in five years,

message must be shared through the media and other

we will see the first results.

means, but it must be done in a simple language that can be understood by everyone. Academic involvement is also

Q: How can you use this information to develop strategies

crucial. Universities and students should be the first to

to attack health risks?

understand the value of genomic testing, the technology

A: We basically want to make a diagnosis of the entire

involved and its real potential.

population. By categorizing the population into different types and levels of risk, the health sector will be able to devise prevention strategies better. For example, the health sector

The National Institute of Genomic Medicine (INMEGEN) leads

has mechanisms already in place to detect and prevent the

Mexico’s efforts in genomic medicine research and trains

development of lung, colon and cervical cancer. However,

future geneticists and doctors. The institute has a broad range

those mechanisms target the population in a way that

of research lines, from cancer genomics to proteomics

227

| INSIGHT

MORE ONCOLOGISTS NEEDED TO KEEP CANCER IN CHECK

“

The country needs to allocate resources to cancer treatment. Resources for health services are not very high and there is no specific amount destined for cancer” GREGORIO QUINTERO, President of SMEO

“The problem is that by centralizing this specialty, we are reaching a saturation point that forces oncologists to work as general surgeons rather than as oncologists.” SMEO plays a vital role in not only generating information about cancer in Mexico, but also disseminating that information among patients, doctors and government entities. The society works closely with government officials to generate public policy based on available scientific and medical research. SMEO has also identified a need for prevention and early detection in Mexico to lower the number of deaths by cancer. “Prevention and early detection are crucial in

228

Since 1960, cancer has quickly climbed the ranks to

training programs for residents and oncologists. There are

become one of the top three causes of death in the country.

certain cancers that can be prevented in one way or another

According to Gregorio Quintero, President of the Mexican

or that can be detected early, improving the chances of

Oncology Society (SMEO), more investment is needed to

recovery,” explains Quintero. “SMEO participates in several

prevent this disease from taking more lives. “The country

academic events where we always cover topics focused on

needs to allocate resources to cancer treatment. Resources

early detection.” This issue needs to be part of the national

for health services are not very high and there is no specific

public policy and SMEO is working with other associations,

amount destined for cancer,” explains Quintero.

the Senate and other entities to convince the government to allocate resources for early detection of different types

In Mexico, the Ministry of Finance allocates funds on a

of cancers like breast or prostate.

yearly basis to the health sector, dividing these into five subfunctions: community service provision, personal

Although there are many areas of opportunity to provide the

services provision, generation of health resources, health

attention that cancer patients need, Quintero says technology

governance and social protection. But although most of

can help bridge the information gap. “In terms of information

the budget goes to IMSS and ISSSTE, it is nowhere near

access and availability, having Big Data and information

enough to cover cancer patients. “This is especially true

available for everyone to access is important.” Yet, for this to

with innovative treatments that can be more expensive,”

work, Quintero says the entire country needs to be connected

Quintero says.

and have access to information. In Mexico, telemedicine works for general consultations or to get the opinion from

Another red flag SMEO has identified is the lack of

an oncologist at a clinic where there is no oncologist available.

oncologists and the fact they are mostly concentrated

But for the actual treatment of cancer patients, there needs

in Mexico’s largest cities, leaving many without access

to be an oncologist in residence, especially since medications

to treatment. “The country has a lack of oncologists per

and treatments evolve at a very fast rate. “Accessibility is

inhabitants and most are centralized in Mexico City and other

necessary in all regions across the country,” he says.

large cities. For this to change, we require more hospital infrastructure,” says Quintero. Increasing the number of

SMEO has worked directly with many researchers and

oncologists requires more medical schools and hospitals

oncologists in Mexico who participate in research activities.

to be established across the country. SMEO has also created

However, there is no consolidated research system. The

international alliances with North American and European

society has also made efforts to form cooperation groups

organizations. The society has mutual collaboration

so research can be done among different hospitals. “Our

agreements that allow the exchange of members, as well

magazine also plays an important role in promoting research

as agreements with pharmaceutical companies to provide

efforts and the results of cooperating groups,” he says. “We

training for residents and oncologists.

are in the process of indexing the magazine into MEDLINE. If we succeed, we would be the first Mexican oncology

A lack of jobs in nonmetropolitan areas is another reason

magazine indexed and one of the few Latin American

behind the lack of oncologists per inhabitants in the country.

magazines on the platform.”

INSIGHT |

EMPHASIZING A HOLISTIC APPROACH TO PREVENTION PEDRO GUTIÉRREZ-FAJARDO President of the National Association of Cardiologists in Mexico (ANCAM)

Although cardiologists can work to prevent heart

their routine checkups, specialists can detect risk factors

diseases, the most effective strategy to decrease

related to heart disease early and direct patients to a

incidences would be to follow a holistic approach where

cardiologist.”

all doctors and specialists collaborate in identifying risk factors, says Pedro Gutiérrez-Fajardo, President

With children, however, ANCAM’s strategy is completely

of the National Association of Cardiologists in Mexico

different since the risks they face change completely. “An

(ANCAM). “We need to prioritize prevention. It is the

obese child will become a hypertensive patient at an early

easiest and most economical way to get the best medical

age, which increases the possibility of experiencing a heart

results,” he says.

attack earlier. This situation, when replicated, generates a heavier strain on the national health system,” says Gutiérrez-

ANCAM has a 35-year history and Gutiérrez-Fajardo says

Fajardo. However, with children, there also is an increased

that in that time, the association has consolidated by

opportunity for effective communication. “Children are very

maintaining an open and inclusive approach toward its

receptive, so we want to develop an educational program

members. “ANCAM hosts graduates from 28 cardiology

that focuses on the creation of healthy habits, such as

schools in the country. We have also worked to establish

eating healthy food, hydrating, exercising and sleeping well.

collaboration agreements with different national

We hope to not only educate children but to educate their

cardiology societies and international institutions, such as

parents, as well.”

the American College of Cardiology, the American Heart Association, the American Society of Echocardiography

For Gutiérrez-Fajardo, prevention goes beyond the medical

and the European Society of Cardiology, to maintain a

sphere, impacting directly on the country’s development.

constant influx of information,” he says.

“Health, education and economic development go hand in hand. There is no point in having a young population with

The association focuses on constantly providing updated

high productivity potential if it is sick. Rather than being

information to cardiologists and also shares this data with

an asset for the economy they can become a strain on the

other specialists. “We organize regional events where

health system,” he says.

we invite doctors and nurses from areas like emergency and intensive care, endocrinology and gynecology,” he

Besides its own campaigns, ANCAM also has reached out

says. The holistic approach the association is taking is

to the public sector to collaborate in the creation of public

rooted in a single idea: prevention. However, the hardest

policies that prioritize prevention at an early age. “We

part to making this approach successful is boosting

are trying to work with the Chamber of Deputies to bring

understanding among the general population regarding

forward a proposal to engage in this topic more seriously.”

the importance of prevention and how to minimize risk

Gutiérrez -Fajardo suggests the prohibition of junk food in

factors, according to Gutiérrez-Fajardo.

schools and in areas surrounding them. “It is a matter of providing education and healthy options from an early age,

Although ANCAM uses social media to deliver concrete

but we need to work alongside the public sector.”

and understandable information regarding prevention of heart disease to the general population, Gutiérrez-Fajardo

While this collaboration solidifies, ANCAM will continue

says there are priority groups in which the association

working to strengthen its alliances and collaboration

needs to focus, with children, young adults and women

agreements with other institutions to keep promoting

among the most important. “There are more women dying

healthy habits and services among the general population.

of heart disease than of breast cancer. We are joining

“The important thing is to continue working on education,”

forces with gynecologists, so whenever women go for

says Gutiérrez-Fajardo.

229

| INSIGHT

WORKPLACE MANAGEMENT KEY TO SUSTAINABLE PRODUCTIVITY GABRIEL ALVARADO Latin America Vice President and General Manager of KRONOS

230

Mexico’s young and qualified labor has attracted many

Kronos’ software also helps managers address work

international investors, but if this workforce is not

absenteeism by shifting employees to the areas where they

managed properly, particularly in terms of absenteeism,

are necessary. While this may seem simple, as a company

productivity suffers, says Gabriel Alvarado, Latin America

becomes larger its logistics become increasingly complex.

Vice President and General Manager of Kronos. “Downtime,

“We worked with a company that had a significant problem

even for a single minute, can cost companies thousands

with work absenteeism. This company also had problems with

of dollars.”

unions because employees were granted a series of benefits but there was no system in place to address whether specific

Work absenteeism cuts the productivity of Mexican

benefits, such as one Friday afternoon free per month or

companies by 31.4 percent, according to the Society

a series of discounts, had been already granted to specific

for Human Resource Management (SHRM). Moreover,

employees. This led to union complaints of unfilled services,

the organization states that only 30 percent of Mexican

while the company’s records indicated that the services had

companies have substitute workers to fill these absences.

been provided. Our system allowed us to easily track which

Preparing for absences and adapting to them are essential

benefits were actually being used by the employees and gave

to maintain a high level of productivity.

us a picture of all the benefits used and by which workers.”

“

Downtime, even for a single minute, can cost companies thousands of dollars”

Kronos has developed solutions for companies of all sizes. Its Workforce Central platform has over 30,000 clients worldwide, according to Alvarado, while its Workforce Ready software was created exclusively for SMEs. “We are focusing on human capital management for SMEs, especially on properly assigning work hours and payment.” Kronos also allied with SAP for the development of a platform called SuccessFactors, which administrates and develops talent.

Kronos is a multinational developer of talent-management and HR solutions for the manufacturing, health, IT, retail,

Kronos will continue to invest in technology to stay at the

banking, aerospace and distribution industries, among

forefront of the HR management sector. “We developed a

others. The company’s solutions allow businesses in many

solution called Workforce Dimensions, which uses AI and

industries to optimize the use of their personnel and their

machine learning to empower employees to exchange work

time in order to increase productivity. “Our goal is to help

information and even switch shifts among themselves,”

companies acquire and manage the appropriate workforce

says Alvarado. Moreover, the AI collects information from

for a company’s specific needs. Our software allows

employees and managers and makes recommendations

managers to create diverse scenarios for their employees

based on the needs of the workplace.

in order to find the one that best enhances productivity,” says Alvarado.

High productivity and performance will continue to be priorities for Kronos in Mexico and the world. The

The company focuses on work optimization, which tackles

company is more than a solutions developer; its goal is to

the proper use of time. “While discipline related to entry

support companies throughout their journey toward high

and exit hours is an important matter for many companies,

productivity and performance, says Alvarado. “Kronos

few actually monitor their employee’s performance during

believes that workforce management is a journey, which

work hours,” explains Alvarado. “Our software also tracks

begins with the installation of a platform that must evolve

employees’ individual performance and hours worked.”

along with the workforce.”

VIEW FROM THE TOP |

RELIABLE DATA KEEPS TALENT UPDATED PEDRO VERA Partner and Director General of Intersistemas

Q: What is the greatest added value that Intersistemas

Q: What channels do you use to reach your target audience?

can offer its clients?

A: We publish close to 2,000 pages of medical and healthcare

A: We do not market our products blindly. We build a tailor-

content every month, written by a network of 600 authors

made communications strategy around our clients’ needs

who are leaders in the healthcare sector, half of them Mexican

based on our content and service offering so they can

and the other half employed by internationally renowned

reach their desired audience. Intersistemas has a number

companies. All our content is based on hard evidence,

of business units, one of which is focused on B2B relations

balanced among topics and without any commercial

where we work with companies in a variety of industries,

bias, which has helped us grow for the past 49 years and

including pharma, banking, insurance and food and

position Intersistemas as a reliable source of information.

beverages. Our other unit reaches out directly to doctors

This vision helped us become exclusive representatives

before they graduate and is dedicated to building platforms

of the New England Journal of Medicine, one of the most

for continuing education. Our goal is to provide doctors in

important medical publications in the world. We also work

every specialty with the best tools and up-to-date content

with institutions like the American Academy of Pediatrics

from reliable sources to help in their day-to-day activities.

and the American Academy of Family Physicians. Once we generate content, we lean on the pharmaceutical industry

All our units have demonstrated positive growth, although

to distribute it physically and digitally. We are supported by

ICAS has been the most aggressive. ICAS, our Employee

leading pharmaceutical laboratories, which gives us an entry

Assistance Programs division, gives people access to

point to doctors in all fields. Our sources speak for themselves

emotional support and psychological help programs

and laboratories know they are contributing to an ongoing

24/7. This division also provides nutritional assistance,

education effort. To complement this offering, we have our

legal consulting and helps clients manage government

own distribution channel called Medikatálogo, which reaches

paperwork. Because everything is done in-house, we can

doctors directly, especially those in remote areas.

guarantee the quality of our services. Client confidentiality is one of our priorities and we are certifying our personnel

Q: What is the main benefit that companies can get from

in ISO-27001, an international standard on data security.

using Intersistemas’ B2B products and services? A: Our main focus is to ensure the well-being of our clients’

Q: What flagship project showcases the capabilities of

employees according to a holistic approach. Following

Intersistemas’ offering?

our culture of prevention, it does no good for a doctor to

A: After medical students graduate as general doctors, they

prescribe a medicine to someone if the person does not

need to pass the National Exam for Applicants to Medical

understand what is wrong with them or how they can solve

Residencies if they want to specialize. However, out of

their issue. Through our Bienestar Total platform, our clients’

50,000 applicants, only 5,000 can access postgraduate

employees can access material that promotes a healthier

studies and some fields are more popular than others.

lifestyle, which in turn creates a good-will relationship between them and their employer. We have organized really

We developed an educational platform called Exarmed

successful campaigns for quitting smoking, losing weight

to help students prepare for the exam. They can even sit

and promoting more nutritious eating habits at companies.

for a simulated test. Exarmed also highlights the topics applicants need to work on and how their knowledge compares to students from other institutions. Our

Intersistemas is an editorial group focused on the publication

solution has benefited thousands of students, which

of books, magazines and educational programs for the medical

motivate us to keep developing platforms oriented to

and healthcare sectors. It covers 18 specialties through articles

continued education.

written by 600 opinion leaders

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| VIEW FROM THE TOP

GUIDANCE TO NAVIGATE EVOLVING HEALTH STANDARDS FAUSTO HERNĂ NDEZ Director of VALID

232

Q: How does VALID distinguish itself when offering its

A: The main obstacle facing the health industry is

validation services?

finding employees who are trained in all matters related

A: VALID is focused on becoming the ideal adviser to

to regulation, especially for cold chain logistics. If the

those clients that want to strengthen their regulatory

logistics provider, including the driver, is not fully trained

compliance in the health industry. Health standards in

on the cold chain, there is a risk that some products will

Mexico are constantly evolving and companies in the

be damaged. The lack of training also impacts the final

sector often require advice to stay up to date.

consumer.

For example, when the Ministry of Health published NOM-

For example, if the logistics operator in charge of

059, it did so to introduce better international practices

delivering medicine to a hospital does not know about

in the production of drugs under the Pharmaceutical

cold chain logistics, it can put the hospital at risk and

Inspection Cooperation Scheme (PICS). Companies need

affect the health of patients. The lack of training could

to know and understand this NOM. VALID is fully up-

be catastrophic for all people involved. VALID specializes

to-speed on this and other regulatory changes and can

in training health professionals on regulatory issues such

provide support to national and international companies,

as ISO, international GAMPs, ICH and PICS guidelines.

facilitate their access to the market, comply with regulations and provide them with greater commercial

Q: What success stories has VALID had thanks to these

value for their products and services.

initiatives? A: Gerresheimer, a primary packing glass company based

Q: Considering the growth of the medical devices sector

in Queretaro; the pharmaceutical company Synthon,

in Mexico, are there any plans to expand your services

in Guadalajara; and Power Ice, a cold chain materials

to this niche?

supplier, are among the successful cases of companies

A: For a long time, most of our main clients were national

that thanks to our consulting services are seeing a change

and international pharmaceutical companies but this has

in their performance. Overall, there have been many

changed in recent years and two segments in particular

successes related to VALIDâ&#x20AC;&#x2122;s collaborations with both

have been growing in Mexico: medical devices and third-

national and international clients.

party logistics (3PL). Mexico is the largest provider of medical devices in Latin America and there has been

Q: With which regulatory entities is VALID connected

an increase in the number of companies that require

and what actions do you take to strengthen your

our services in this area. 3PL companies require more

relationship with them?

support related to quality systems, cold chain validation

A: We are connected with COFEPRIS but we also regularly

and personnel qualification.

attend forums presented by CANIFARMA, Mexico's National College of Pharmaceutical Chemists Biologists

Q: Which of VALID's services for the pharmaceutical

(CNQFBs) and the Mexican Association of Professionals

and medical devices sectors are in greatest demand and

in Sanitary Regulation of the Industry of Medical Supplies

what added value do these solutions provide?

for Health (AMEPRES). At these forums, we receive feedback from the regulatory

VALID is a consultancy that offers validation services to

authorities to understand how regulations are trending

companies in the pharmaceutical and medical devices sectors.

in Mexico. It is also a way to keep in touch with other

Its team includes chemical engineers, computing technicians

companies, associations and entities that are relevant

and mechatronics engineers

to the industry.

INSIGHT |

DATA ANALYTICS INCREASE EFFICIENCY, REDUCE COSTS GUILLERMO BILBAO Director of PA Consulting Mexico

A growing and aging population that suffers more from

aware that it is much more expensive to treat a disease than

chronic diseases is increasing demand on the Mexican health

to prevent it.”

sector and technology can help, says Guillermo Bilbao, Country Manager and Director of PA Consulting Mexico.

Mexico has numerous medical facilities but few adhere to

“Using data, harnessing the right technology and organizing

higher standards of care. According to Bilbao, Mexico has

care around patients are key guiding principles to handle

over 7,500 hospitals but only 341 are certified. “Patients and

current demand with limited resources, he says.

hospitals in Mexico could benefit from a certification program that directly evaluates their performance and addresses areas

PA Consulting is a London-based firm that provides

to improve,” he says. While other countries have successfully

management, technology and innovation services in many

implemented programs of this kind and benefit from its

sectors, including energy and utilities, consumer goods,

results, Mexico has fallen behind.

financial services, government and healthcare. The firm has built a strong presence in Mexico in the oil and gas industry

PA Consulting is now supporting a public institution in what

and is now veering toward healthcare through a collaboration

Bilbao expects to be a fruitful collaboration with the Mexican

with public institutions. “We want to support the public sector

healthcare sector. The firm expects to present and implement

with the design and implementation of a distinct shift in the

the first favorable results in the sector in 2020. “Eventually,

market,” says Bilbao.

we will be able to work in Mexico on everything from strategy to implementation in the healthcare sector. For instance, we

The firm is investing in a value-based healthcare proposition

have significant experience in large, consolidated sales from

of achieving a quality, personalized and preventive health

our work with the UK’s healthcare system.”

system, explains Bilbao. One of the pillars on which the company relies is the use of data. “Modern devices used at hospitals generate a large amount of information. However, this information is not used properly because users often do not have the knowledge, experience or analytical abilities to fully take advantage of it,” he says. Using information properly can uncover areas of improvement and reduce operational costs by targeting care much more effectively. “Hospitals collect large amounts of information every minute but that information is not being taken advantage of. We use dark data as an analytical approach to help our clients become more data-driven. Rethinking the questions that we need data to answer allows to properly gauge the patient’s experience and improve it.” Bilbao explains that while many hospitals invest in state-of-theart equipment, they often do not fully exploit the technology’s capabilities, which will become increasingly necessary in the coming years. “Budget cuts in public healthcare will make efficiency crucial.” Moreover, using data effectively will allow for the creation of personalized treatments or prevention plans for patients. “Doctors and healthcare providers are fully

233

HRAEPY, Merida, Yucatan

234

ROUNDTABLE | Among the many challenges the healthcare sector faces, there is a growing need for trained professionals. The problem is expected to become even more pronounced as the population ages and gains weight. The country needs to train and attract the necessary talent to achieve its health goals. However, training requires combined efforts from multiple fronts, including universities, the government, recruiters and private companies. Mexico Health Review interviewed the top universities in Mexico and other talent experts to understand where the gaps are and what

HOW ARE YOU CONTRIBUTING TO ADDRESSING THE NEED FOR DOCTORS AND SPECIALISTS?

programs are best suited to generate the needed skills for up-and-coming health professionals.

Rather than a lack of specialists, I think doctors are badly distributed. On average, there are two to three doctors per 1,000 inhabitants. However, in cases like Mexico City, the concentration of doctors can be three times higher than in other regions. This 235

disparity should be addressed not only by universities but also through the National Health System. Around 8,000 doctors graduate from a specialty in Mexico every year but the available university placements are determined based on hospitals’ vacancies instead of the actual needs of the national population. Ideally, the government should have a way of organizing the country’s local and national health needs to have a clear idea of how many doctors and specialists are required by state, which would

GERMAN FAJARDO Director of the UNAM School of Health Sciences

make it easier to distribute them.

Mexico does not train enough specialists in neurology to address the needs of its population. The country has only 10 training centers for neurosurgery and about 13 for neurology. Moreover, specialists are often unable to work outside the largest cities in Mexico: Mexico City, Guadalajara and Monterrey. We are betting on telemedicine to increase access to care. We provide several online training courses for health professionals. The institute has 16 rooms equipped for telemedicine and two videoconference rooms thanks to a MX$20 million (US$1.04 million) donation from the Public Charity Administration.

MIGUEL ÁNGEL CELIS Director of INNN

In Mexico, there are around 347,000 doctors. However, only around 2,195 are specialized in cancer management. According to estimates, there should be 20 medical oncologists for every million inhabitants. This means that Mexico has only one-fifth of the required number. There are around 164 medical schools in the country and until three years ago, only 10 percent included oncology in their syllabus, even though cancer is the third-leading cause of death in the country. INCan has taken on the task of talking with the deans and faculty directors of these universities to introduce oncology to their curricula. So far, we have signed a collaboration agreement with 50 medical schools to strengthen their oncology programs. Our goal is for all medical schools to have oncology programs within five years.

ABELARDO MENESES Director General of INCan

PERSONAL CARE &Â WELLNESS

With Mexicoâ&#x20AC;&#x2122;s unabated obesity epidemic, many are exhorting individuals to take their health in their own hands. However, this requires a comprehensive approach that involves not just individuals but product and service providers from many areas that are often overlooked, including physical activity and skin, eye and dental care. Globally, the wellness economy has experienced steady growth, achieving a market value of US$4.2 trillion. People are considering wellness as a concept that involves different aspects of their lives, such as personal care, beauty, anti-aging concerns, real estate and even the workplace. Wellness trends are migrating from a nutrition and exercise dynamic, to a more comprehensive lifestyle concept.

This chapter takes a in-depth look at the companies catering to this segment of the healthcare industry, what they are doing to foster proactive approaches to healthcare and wellness and how they are helping to shape trends that are changing the countryâ&#x20AC;&#x2122;s health dynamic.

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CHAPTER 11: PERSONAL CARE & WELLNESS

240

ANALYSIS: Mexico a Leading Player in Global Wellness Economy

242

VIEW FROM THE TOP: Juan Carlos Muñoz, Banorte

243

VIEW FROM THE TOP: Sandrine Dupriez, Laboratorios Expanscience Mexico

244

VIEW FROM THE TOP: Patrick Devlyn, Grupo Devlyn

245

VIEW FROM THE TOP: Pablo Cruz, Hospital de la Luz

246

VIEW FROM THE TOP: Ignacio Castañón, Alcon Mexico

247

INSIGHT: Enrique Graue-Hernández, Instituto de Oftalmología Fundación Conde de Valenciana

247

VIEW FROM THE TOP: Rubén Flores, Ópticas de Máxima Visión

248

INSIGHT: Frank Rosengaus, Ultimate Médica

249

VIEW FROM THE TOP: Roberto Esses, Gympass Mexico

250

VIEW FROM THE TOP: Alejandro López, IM Natural

251

VIEW FROM THE TOP: Magdalena Ferreira-Lamas, Avon

252

INSIGHT: Antonio Cruz, Kurago Biotek

253

VIEW FROM THE TOP: Alfonso Ventura, APEC

239

| ANALYSIS

MEXICO A LEADING PLAYER IN GLOBAL WELLNESS ECONOMY Mexico is Latin America’s leading destination for wellness tourism, with 18.7 million total travelers who spent US$12.8 billion in the country. Globally, Mexico ranks 11th in terms of wellness tourism. The potential growth opportunities in the country are attracting top wellness chains, making Mexico a leading player in the segment The global wellness industry grew from a US$3.7 trillion

As Mexico continues to grow its skin care market, there

market in 2015 to US$4.2 trillion in 2017, according to the

remains a great deal of opportunity. Dupriez highlights

Global Institute of Wellness. Today, the industry represents

the country’s environmental and climatic conditions that

5.3 percent of global economic output and Mexico

make it necessary to use sunscreen, but the use of these

increasingly is playing a leading role in the sector.

products remains low. “Due to the increase in pollution, the skin requires more dedicated care. In Mexico, sunscreen

240

Greater awareness of personal health, appearance and

is not yet as widely used as it should be,” says Dupriez.

well-being are fueling the industry’s growth, along with

Mexico needs to transform its skin-culture since sunscreen

technological advances that improve access to information.

and other products should not only be used when people

According to an Arizona State University report, the

are directly exposed to the sun but as a daily protection.

variety of wellness apps and mobile health monitors

“In Colombia, these products are used three times more

are empowering individuals to monitor and analyze

than in Mexico. This is an area where there is still much to

key indicators like heart rate and activity and stress

do. People should start using sunscreen every day, not just

levels. “Today, many people use the internet to look for

at the beach,” she says.

more information about their health and find innovative treatments,” says Sandrine Dupriez, Director General of

The market for men is another area of opportunity as social

Laboratorios Expanscience Mexico.

conventions are broken about skin and makeup. IM Natural is among the company’s targeting this demographic. “We

Globally, Mexico is tapping into the wellness trend to

launched a line for men four months ago. The products

become the No. 1 destination for wellness tourism in Latin

that have been most successful in this market are

America and No. 11 overall, according to the Global Institute

moisturizing and shaving creams, and products for beards

of Wellness. Skin and visual care are among the leading

and mustaches,” says López. The company is undergoing

segments fueling growth in the country. “The cosmetics

a knowledge development phase but in the near future it

industry develops indispensable goods. Both men and

will be launching more products, he adds.

women use these treatments to enhance their physical appearance and to consequently feel better in terms of self-care and self-esteem,” says Alejandro López, Director General of IM Natural.

MARKET PERCENTAGE BY PERSONAL CARE SECTOR CATEGORY

The Mexican market is expected to continue growing above the world average over the next few years. According to CANIPEC, approximately 20 percent of the US$10 billion personal care market belongs to skin care products. The value of the Mexican visual market totals US$35 million, according to Coopervision, and it has the potential to growth to US$200 million in the next five years.

SKIN CARE The global skin care market is valued at US$141.3 billion and it is expected to hit an estimated value of US$180.3 billion by 2024, according to Statista. The driving factors behind this growth, according to Euromonitor International, is a growing consciousness regarding health, appearance and well-being.

20% Skin care Hair care 20% Shower 14% Fragrances Oral care 13% Make-up and

Make-up and cosmetics cosmetics

Oral care 8% Fragrances Shower 7% Skin care

7% Deodorants Baby care 5% Sets/kits 4% Male shaving Solar protection 1% Solar protection Depilatories 1% Depilatories Male shaving .35% Sets/kits Baby care

Source: CANIPEC and Euromonitor International

Hair care

Deodorants

FORECAST FOR THE GLOBAL SKIN CARE MARKET (US$ billion)

134.5 120

2018

155.8

148.3

140

141.3

160

163.5

171.7

180.3

180

GLOBAL KEY WELLNESS SECTORS AND MARKET VALUE (2017) 1. Personal Care, Beauty and Anti-Aging (US$1,083 billion) 2. Healthy Eating, Nutrition and Weight Loss (US$702 billion) 3. Wellness Tourism (US$639 billion) 4. Fitness and Mind-Body (US$595 billion) 5. Preventive and Personalized Medicine and Public Health (US$575 billion) 6. Traditional and Complementary Medicine (US$360 billion)

2019* 2020* 2021* 2022* 2023* 2024*

Source: Statista 2019

*Forecast

Euromonitor International expects the cosmetics industry in Mexico to enjoy annual growth of 11 percent through 2019. Among the most valuable brands in the industry are

7. Wellness Lifestyle Real Estate (US$134 billion) 8. Spa Economy (US$119 billion) 9. Thermal/Mineral Springs (US$56 billion) 10. Workplace Wellness (US$48 billion) Source: Global Wellness Institute

241

Johnson’s, which is the flagship brand for Johnson & Johnson, Gillette, L’Oreal, Pantene and Nivea. However, global brands

Other international organizations like the World Economic

recognize that the Mexican market has its peculiarities and

Forum have stated that vision problems should be considered

requires tailor-made products. “We see interesting trends

an easily solvable public health issue that could result in an

among Mexican women, who focus on internal and external

almost immediate change in a country’s productivity.

beauty,” says Magdalena Ferreira-Lamas, Vice President and General Manager for the Group of North Latin American

Awareness is key, says Alfonso Ventura, Director General

Markets (NoLA) of Avon. The company launched a new

of The Association to Prevent Blindness in Mexico (APEC).

brand of makeup called MARK, with new colors, such as

“About eight out of 10 people could have their eyesight

brown, violet and blue. “These are designed to offer a choice

problems resolved if they went to see an ophthalmologist,”

for women of all walks of life and ages. The brand adapts

he says. Collaboration between different visual health

well to the taste of Mexican woman, giving a wide variety of

players could have an almost immediate impact on society,

options for everyday use,” says Ferreira-Lamas.

adds Patrick Devlyn, Director General of Grupo Devlyn. “If the government, companies and the ophthalmological and

A rising concern regarding skin problems is another factor

optical sectors work together, there can be a favorable and

fueling the skin care products industry. The National Institute

almost immediate impact on society.”

of Cancer (INCan) reported skin cancer as the second-most frequent type of cancer in Mexico. Each year, 16,000 new

Devlyn adds that the solution is often a simple one. He says

cases of skin cancer are diagnosed in the country with the

that visual healthcare as “a public health issue becomes

WHO arguing that an absence of a preventative culture is a

solvable through a pair of well-graduated and affordable

contributing factor. The use of products that protect against

glasses, creating a significant impact on various segments

UV exposure could help and these products are also stronger

of society.” Glasses in comparison to treating other

than ever. “Years ago, people would wear sunscreen with

diseases are affordable and easy to provide. “The cost of

SPF protection 12. Today, the minimum is SPF 30, while SPF

frame or contact lenses is minimal when compared to the

50 has become the most-used product,” says Dupriez. “UV

productivity and engagement benefits that people can get

protection levels have gone up to offer better protection.”

from them,” says Devlyn.

VISUAL HEALTH

Companies and nongovernmental institutions also are

WHO’s Universal Eye Health: A global action plan 2014-

working together to reduce eye impairments that cannot

2019 report estimates there are 285 million visually impaired

be resolved by glasses and which involve surgery, such as

people worldwide, of which 39 million are blind, while 80

cataracts. “There is still a lot to do in terms of visual health

percent of all causes of visual impairment are preventable

in Mexico,” says Ventura. “One condition closely linked

or curable. The international organization has emphasized

to blindness is diabetes, which is a growing problem in

that efficient and available eye care facilities are essential

our population. While cataracts are the primary cause of

to efficiently control blindness, including visual impairment.

reversible blindness in this country,” he says.

| VIEW FROM THE TOP

SUPPORT FOR A HEALTHY LIFESTYLE JUAN CARLOS MUÑOZ Health System Director of Banorte

Q: What is Banorte’s approach to healthcare and how

cost. The goal is to generate changes in lifestyle and

do employees benefit as a result?

habits that will have a positive impact on health over

A: Traditionally, companies go to third-party insurers to

the long term. To complement this program, we are also

manage their employees’ healthcare. We are one of the

installing gyms at our offices that employees can use six

few corporations that administer healthcare services

days a week at a reduced rate.

internally. The main advantage this offers is that we can 242

design the program’s structure ourselves and set our own

Q: How has Banorte Salud impacted Banorte’s workforce?

standards.

A: This is a long-term project and it is hard to measure its immediate effects, unlike a change in benefits such as a

Our approach is based on two elements. First, Seguros

salary increase. Having good health, however, is ultimately

Banorte, which covers our employees’ major medical

worth much more. We want the people at Banorte to feel

expenses with special offers and conditions. Second,

that we care for them. This generates a sense of belonging,

we offer a health service called Banorte Salud, which

which indirectly attracts new talent and boosts retention.

provides consultations to employees by our own health

Having access to healthcare also reduces stress among

professionals. All employees have access to this program,

employees, hopefully making them happier to work for us.

which means we do not discriminate based on position within the company or health status.

Q: What are Banorte Salud’s goals for 2019 and 2020? A: Qualitatively, we want to provide our health program

Other insurance agencies can lose clients due to

to all employees across the country. Of course, this

competition over services and prices. We do everything

introduces logistical challenges. In very remote places,

to ensure all our employees receive equal high-quality

it can take a person two hours to get to the nearest

healthcare. Outside our offices, we decide which hospitals

facility for a consultation. In these cases, we are looking

and clinics we work with and regularly change them when

at providing telemedicine services.

we feel there are better options. We also work with several specialized clinics. For example, in Monterrey we now

As people begin to live a healthier lifestyle, we hope to

work with a clinic that is focused specifically on cancer.

see less sickness. We have quantitative indicators that show how much our health services are used. These

Q: What are Banorte Salud’s core strategies to improve

include things such as number of visits and number of

employee health?

hospitalizations. Our goal is to bring these indicators down

A: The central component of this health network is

over the next couple of years. This could also be translated

called Vive Sano, Vive Banorte. This is a tool that allows

into economic indicators, by seeing how much a person

employees and their family members to keep track

produced before and after being part of the program.

of their health status. We have our own doctors who can perform screenings at regular intervals. We also

Over the longer term, having a program that can track

have nutritionists and physiotherapists who provide

people’s health and provide them with continuous

personalized treatment. All these services are at no extra

guidance will no doubt lead to less costly healthcare as serious conditions are avoided. In the end, we will have healthier employees at a lower cost for the company.

Banorte is one of the few companies in Mexico that offers in-

Of course, we also need to take into account inflation

house healthcare services to employees through an innovative

in medicine prices over the years. Financing good

approach called Banorte Salud. This service uses in-house

healthcare at a reasonable price will continue to be a

screenings and consults to help employees change their habits

challenge.

VIEW FROM THE TOP |

SKIN CARE GRADUALLY GAINS A FOLLOWING SANDRINE DUPRIEZ Director General of Laboratorios Expanscience Mexico

Q: How have you advanced with the company's target to

baby skin care offers products for all skin types: normal

reach MX$500 million in national sales by 2020?

skin, dry skin and atopic skin. Skin care for babies is

A: Our goal of growing annual sales to MX$500 million

important and fortunately parents are starting to realize

(US$26 million) by 2020 remains the same. This growth

this. In past years, we have raised awareness about skin

will come through both of our business units: our dermo-

care with our team of beauty advisers. They are present

cosmetics line Mustela and our pharmaceutical product

in pharmacies and other points of sales to help parents

line for treating osteoarthritis. The Mustela brand is well-

choose the best skin care for their babies. Key opinion

recognized, which means that the expected growth can

leaders who have experience with our products can also

be achieved. Our treatments for osteoarthritis are more

recommend specific routines to parents.

recognized by healthcare providers every year. Part of our strategy for this line is to strengthen the triangular

Q: How do initiatives like the Better Living Program

relationship between doctors, patients and Laboratorios

contribute to your corporate social responsibility vision?

Expanscience Mexico. In most cases, a doctor prescribes

A: Since April 2018, Laboratoires Expanscience and its brands

the medication and accompanies the patient.

have been certified as B Corp, an international label awarded to companies that develop and operate their activities with a

Today, many people use the internet to look for more

positive impact on society and the environment. Laboratoires

information about their health and find innovative

Expanscience is the first pharmaceutical and dermo-cosmetic

treatments. We have therefore launched an awareness

laboratory in the world to join the B Corp movement. Our

program called Vivir sin Dolor (To Live without Pain),

Better Living Program goes along with our Corporate Social

in which we provide information about osteoarthritis

Responsibility (CSR) policy, which we voluntarily adopted in

symptoms and treatment options, as well as a directory

2004 when we signed up to the UN Global Compact. Besides

of doctors that can help patients with this disease. This

working to improve employee conditions, the program

is helping people to detect symptoms earlier and to take

includes many initiatives for communities.

the right steps to start treating the condition. To ensure the best results, it is important that patients consult their

Locally, we bring support to various social and educational

doctors and complete the whole treatment.

initiatives in Mexico. We provide mentoring to two target groups: female entrepreneurs and high-performing university

Q : Why a re s a l e s o f s k i n p ro d u c t s e n j oy i n g

students. The first program is called Victoria 147 and it

worldwide growth?

provides support to women that want to start their own

A: Due to the increase in pollution, the skin requires a

business or bring it to a higher level. The other mentoring

more dedicated care. In Mexico, sunscreen is not yet as

program is called Talentum. Every year, 60 university

widely used as it should be. In Colombia, these products

students are selected from less favored backgrounds to

are used three times more than in Mexico. This is an area

receive personal guidance on building leadership skills and

where there is still much to do. People should start using

gaining confidence. We accompany these students for six

sunscreen every day, not just at the beach. Also, to be

months and provide shadow practices to give them the

efficient, sunscreen must be applied at least 20 minutes

opportunity of a professional experience.

before sun exposure. UV protection levels have gone up to offer a better protection. Laboratorios Expanscience Mexico is the Mexican branch

Years ago, people would wear sunscreen with SPF

of Laboratoires Expanscience, a French pharmaceutical and

protection 12. Today, the minimum is SPF 30, while SPF

dermo cosmetic laboratory that manufactures innovative

50 has become the most-used product. Our portfolio of

products for skin care and osteoarthritis

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| VIEW FROM THE TOP

BETTER EYESIGHT CLEARS PATH TO PRODUCTIVITY PATRICK DEVLYN Director General of Grupo Devlyn

244

Q: How do you expect operations to change now that the

80 percent of all cases of treatable blindness globally can

Devlyn family has repurchased the company and how will

be resolved with a pair of glasses. Therefore, a public health

this impact your clients and partners?

issue becomes solvable through a pair of well-graduated and

A: The repurchase was the result of a cycle coming to an

affordable glasses, creating a significant impact on various

end with our partner investment fund. We merged with this

segments of society. With children or young people, better

fund to strengthen our position and serve the market in a

sight translates to improved school performance and greater

more competitive way. Our goal now is to consolidate the

engagement in education. Meanwhile, people already working

company with a medium and long-term vision focused on our

can benefit from greater productivity and fewer mistakes. The

brands: Devlyn Optics, Optimart, Clínicas, Vetro and Poyssa.

cost of frame or contact lenses is minimal when compared to

We also want to strengthen ties with our business partners

the productivity and engagement benefits that people can

in department stores and with international brands, such as

get from them.

Ray-Ban, Vogue, Carrera, Lacoste, Carolina Herrera, Michael Kors and Prada.

Q: What strategies is Grupo Devlyn implementing to compete against retail giants like Amazon?

Q: How is Devyln approaching its goal of modernization?

A: Competition can come from different sectors, which means

A: Besides strengthening our business relationships, our

we must be aware of what companies such as Amazon and

strategy is focused on better customer service. However,

Walmart are doing. Our first priority is to make sure we know

the priority is not to open more stores but to improve how

our customers better than anyone, while prioritizing quality

existing venues serve customers. What got us to where we

and service through a personalized experience. Innovation

are now will not keep us there because consumers are not

is another key element in our differentiation strategy. We

the same as they were 15 years ago. Both the market and

create new experiences for the client by employing innovative

the consumer have evolved, creating new challenges. Grupo

technologies and new distribution channels that make it easier

Devlyn must modernize its service by bringing clients closer

for our customers to contact us.

to our opticians to provide quality ophthalmological exams, access to the best products and proper eye care. Grupo

Q: What role do you want Grupo Devlyn to play in the retail

Devlyn will operate through an omnichannel communications

sector in Mexico?

system, allowing clients to contact our stores in the way that

A: Grupo Devlyn’s priority for 2019 is to better serve its

best suits them.

customers and business partners in all segments where it participates. Secondly, we want to work more quickly

Q: According to the World Economic Forum, sight problems

in bringing together the elements and strategies that will

should be considered a public health matter because of their

exponentially improve our brand positioning and presence

impact on productivity. What is Grupo Devlyn’s perspective?

in the market.

A: In collaboration with the Business Coordinating Council (CCE) and other partners like CANIFARMA, Funsalud and the

Q: What recommendations would Grupo Devlyn make to the

Mexican Hospital Consortium, Grupo Devlyn can strengthen

government to properly address eye health?

public policies geared toward prevention. Approximately

A: If the government, companies and the ophthalmological and optical sectors work together, there can be a favorable and almost immediate impact on society. At Grupo Devlyn,

Grupo Devlyn is the largest optical group in Mexico with over

we believe eye health should be a priority in the national

75 years of experience in the retail market. It specializes in

healthcare plan and we can and are willing to collaborate

optometric and ophthalmic solutions and wholesale of optical

with the government to ensure spending on eye health results

products. It has over 1,000 optical shops in Latin America

in a cost-efficient investment.

VIEW FROM THE TOP |

SUSTAINABLE BUSINESS AND CARE MODEL FOR OCULAR HEALTH PABLO CRUZ Director General of Hospital de la Luz

Q: How does Hospital de la Luz improve healthcare

Q: The hospital has two modalities of coverage: intramural

practices and access to ocular care?

and extramural. What is the target population of each and

A: Hospital de la Luz is the oldest visual health hospital

what services are offered?

in Mexico and Latin America and it has been improving

A: About 87 percent of our target population is found in

access to ocular care in the country for many years. We

the Metropolitan Mexico City area. Given that Hospital de la

have also trained many of the professionals in the sector.

Luz and its rehabilitation center are located in Mexico City,

The hospital has developed new areas, such as the Integral

most of our patients from the city and the suburban areas

Attention Center for Visual Disability (CADIVI) and its

are treated under the intramural modality. The extramural

Biomedical Research Center, and has been certified by

modality is applied for visual health campaigns conducted

the Council of General Health for international standards.

once a year for other states, including Chiapas, Oaxaca, Michoacan, Guerrero, Veracruz, State of Mexico and Puebla.

Regarding access to ocular health, Hospital de la Luz has steadily improved its facilities and capacity to increase the

In terms of expanding our services through more hospitals,

number of patients it attends. For example, in 2012 the

we do not believe that is the best strategy for the Hospital

hospital performed 164,039 medical consultations, 63,438

de la Luz. While we understand that there are people who

hospital services and 1,056 rehabilitation services. In 2018,

need our services, we are also aware that it would require

we conducted 199,141 medical consultations and provided

an increase in our capacity. Such action would also affect

110,656 hospital services and 2,024 rehabilitation services.

our residency program, complicating the interoperability

This is the result of two main factors: the hospital's new

residents enjoy between our facilities. An average resident

General Management area and the use of IT technologies

sees 32 patients a day and attends classes from 9am to

that have enabled a greater number of people to gain

2pm. Increasing the number of facilities without boosting

access to our services.

the number of doctors and residents would complicate our efficiency. The hospital prefers to continue operating using

Q: How is the hospital ensuring it is a financially

the same modalities as it does now.

sustainable organization? A: Though in the past we received donations from different

Q: What are your expectations for the new hospital in

companies and foundations, getting funds has become

Iztacalco?

difficult in recent years. It is in our interest to find new

A: We conducted a variety of demographic and marketing

companies that want to contribute to bringing ocular

studies to analyze and determine our next location.

health closer to the most vulnerable populations in Mexico.

Iztacalco has a target population of 5.5 million people and

Hospital de la Luz recently purchased land to construct

high demand for the services we offer. We believe most of

a hospital in Iztacalco, Mexico City, and is looking for

the people who visit our Tacabalera facility from Iztacalco,

companies to donate construction material and money

Nezahualcoyotl, Chalco and other close delegations will

to develop this new facility. However, the hospital does not

prefer to our new facility. The hospital hopes that this new

depend entirely on donations to operate on a daily basis.

location will give people from other parts of the city a closer

As a private assistance institution, the hospital operates

and viable option to care for their visual health.

with a economy of scale scheme to cover the expenses of its daily surgeries, medical and administrative salaries and more. In addition, the hospital also receives an income

Hospital de la Luz has more than 140 years of experience

from eight donated properties located in San Pedro de

attending visual health in Mexico. The hospital is certified by

los Pinos, the city center and the Roma neighborhoods,

the Council of General Health for international standards and

among others.

performs nearly 1,000 ophthalmological services a day

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| VIEW FROM THE TOP

EDUCATION NEEDED TO DISPELL MYTHS ABOUT VISION IGNACIO CASTAÑÓN General Manager of Alcon Mexico

Q: What actions is Alcon taking to strengthen its presence

technology. One example of a product developed internally

in the surgical and contact lenses markets?

is our preloaded intraocular lens named Acrysof. This system

A: The market has enjoyed double-digit growth since 2017,

allows the doctor to insert a lens directly from a packaged

mainly thanks to a greater understanding of cataracts and

container. Because there is no need to submerge the lens

how they can be treated. Also, we are collaborating with

in liquid first and then inject it, less handling is needed and

the leading ophthalmic institutions to drive awareness

the doctor has to do a smaller insertion cut.

on this problem. For instance, the Association to Prevent 246

Blindness in Mexico (APEC) created a successful campaign

The result is a safer and faster procedure. An example of

called Adiós Catarata that we have supported. We held our

technology we acquired externally is a 3D camera that can

own awareness initiatives working together with hospitals,

be attached to the doctor’s microscope to project an image

universities, schools and NGOs. The topic has seen more

on a screen. We acquired this technology two years ago and

press and other media coverage, as well. As a result, more

recently launched it.

people have sought medical attention. While this has created a window of opportunity for our business, the most

Q: Do you train doctors and other health professionals to

significant benefit has been for people who undergo surgery

use these technologies?

and enjoy a substantial improvement in their quality of life.

A: Yes, we are always working on training doctors and optometrists. When we move to our new headquarters

We have had significant success in the contact lenses

in Geneva, Switzerland, we will have a special center

market, too. One of our strategies to reach new customers

for training these health professionals. We will teach

and create awareness was to set up stands at big events

optometrists everything about contact lenses: how they

where people could be checked and receive a diagnosis

are applied and the different types for different conditions.

from an optometrist.

We will also train doctors to use our new technologies. We offer the same level of technology as in the US

Q: How does Alcon differentiate from other companies

and Germany, which presents great opportunities for

offering similar products?

ophthalmologists in this country.

A: After our spin-off, we became the only company worldwide that is 100 percent dedicated to vision and eye

Q: How will demographic shifts and conditions like

care. We are market leaders in all countries where we are

obesity and diabetes impact Mexicans’ visual health?

present. Innovation is our core driver, which is also one of

A: Diabetes has a direct impact on vision. As the incidence

the main reasons why we separated from Novartis. The

of diabetes rises, we will see more retinal diseases. I am

type of research our products require is different, and

not sure if we will need new forms of treatments to deal

being independent allows us to respond faster to our

with these emerging diseases.

client’s needs. Q: How would Alcon like to close 2019? Our innovation strategy is both organic and inorganic

A: Our main mission for 2019 is to grow in the market. We

through the acquisition of other companies with promising

will be launching more products in Mexico in the short term. One is for dry eye, a condition that affects over 350 million people worldwide. In terms of competition, we are

Alcon is a global leader in eye care and it is dedicated to

not over-preoccupied; being the biggest company has

help people see better. The company manufactures surgical

certain advantages. We will reach more patients, be able

and pharmaceutical vision-care products. Alcon Mexico has

to provide more attention to medical professionals and

been in the market for over 40 years

generally see more commercial success.

INSIGHT |

EXPANDING EYE-CARE REACH ENRIQUE GRAUE-HERNÁNDEZ Director of Cornea and Refractive Surgery and Board Member at Instituto de Oftalmología Fundación Conde de Valenciana

Sight issues should be considered public health problems

Despite the importance of visual health, there are two

because of their negative impact on the productivity not only

important elements hindering the segment’s development:

of those affected but also of those around them, says Enrique

lack of access to health services and lack of a health and

Graue-Hernández, Director of Cornea and Refractive Surgery

prevention culture regarding eyesight. As a 43-year-old

and a Board Member at Instituto de Oftalmología Fundación

nonprofit private assistance institution (IAP) specialized

Conde de Valenciana. “Sight is what allows people to connect

in treating sight conditions, Instituto de Oftalmología

to the world, to interact with it and to be productive. People

Fundación Conde de Valenciana has made a significant effort

with impaired sight impact their entire surroundings.”

to reach communities that traditionally are underserved. “We have tried to reach places that do not have ophthalmology

According to Graue-Hernández, sight issues can have

services," says Graue-Hernández. At the same time,

a significant and negative impact on communities with

improving the lack of a health and prevention culture

limited resources. “Especially in small towns where a

is a work in progress that requires the entire industry’s

person’s role might have a larger impact on the community,

participation. “Eyesight issues are as important as any heart

impaired sight or blindness might lead to detriments in the

or lung affliction, which means people need to take care of

community’s development.”

their eyes as much as they care for their other organs.”

VIEW FROM THE TOP |

VISUAL HEALTH AN OVERLOOKED FACTOR IN PRODUCTIVITY RUBÉN FLORES Director General of Ópticas de Máxima Visión

Q: How does poor visual health affect businesses and how

Q: How is Ópticas de Máxima Visión's business model

can you help them address this problem?

innovating optical stores?

A: The World Economic Forum stated that vision problems

A: Our business model targets other companies. We are

must be considered a matter of public health and that 80

an optician for businesses that provides the exact same

percent of all visual problems can be solved with glasses.

benefits as others opticians, albeit with a free door-to-

For instance, some individuals spend their office hours

door delivery service. In our visits to clients, we bring every

nursing a headache caused by poor vision, which decreases

necessary tool and even sample glasses to the client for

overall productivity.

them to choose from. Moreover, we finance the acquisition of our products at no added cost.

We work directly with the HR and medical departments of companies. We offer tests for their employees at no cost and with no commitment to buy. However, we provide

Ópticas de Máxima Visión is focused on improving visual health

a clinical file to the company’s management, which the

and has over 13 years of experience. It seeks to be a different kind

company doctor can use to incentivize employees to buy

of optical center with an innovative approach. It commercializes

glasses if they need them for their position.

glasses brands such as Levis, Reebok and Ray-Ban

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| INSIGHT

NONINVASIVE PROCEDURES BOOST COSMETIC TREATMENTS FRANK ROSENGAUS Medical Director of Ultimate Médica

For plastic surgery procedures to become commonplace,

these procedures go wrong,” says Rosengaus. Social media

there needs to be a cultural shift that allows people to talk

has played a key role in making bad procedures go viral. “In

freely about it, says Frank Rosengaus, Medical Director of

Mexico, there is a great deal of fear regarding lip procedures

Ultimate Médica. “In other countries, cosmetic interventions

because of cases in the US where treatment results were not

have become a sort of social event. Everybody talks about

ideal. We spend a lot of time explaining to people that these

them openly. However, in Mexico we have a cultural barrier.”

negative results are less than 1 percent of the total treatments.” Controlling the negative consequences of these procedures

248

Hoping to take advantage of the expected boom in cosmetic

might be difficult at times but Rosengaus says that adequate

surgery specified by the International Society of Aesthetic

enforcement of existing regulations can go a long way.

Plastic Surgery (ISAPS), Ultimate Médica specialized in

“Governments are being more careful when defining who can

noninvasive aesthetic treatments and cosmetic plastic

do what. Whoever wants to perform these procedures needs

surgery. ISAPS ranks Mexico fourth in terms of its expectations

to prove that they have the proper training and the necessary

regarding cosmetic treatment volume concentration. However,

certifications,” he says. Mexico has proper regulations; the

Ultimate Médica has not seen these hopes come to fruition.

problem is enforcing them correctly, according to Rosengaus.

“In other countries, aesthetic procedures have proliferated thanks to a cultural change. South Korea has become a mecca

Technological improvements and making procedures easier

for plastic procedures, particularly Seoul as it attracts medical

could also provide a big boost to cosmetic procedures.

tourism from other Asian countries.” However, this change in

Although new technologies can be more expensive as they

South Korea did not come easy, says Rosengaus. “Important

penetrate the market, they become cheaper. “Cosmetic

popular icons started talking freely about the subject, which

procedures are becoming more affordable; they are

changed society’s perception.”

standardized and commoditized, which helps the market grow,” says Rosengaus. Noninvasive procedures will be the

Though a cultural change is necessary, it is also important to

main drivers for growth in this market, he adds. “People do

address the perceptions that people have about cosmetic

not want to spend time and money in recovery. They want

procedures. “We need to limit the effects that exist when

procedures to be painless, fast, reliable and inexpensive.”

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ENHANCED WELLNESS CAN BEGIN IN THE WORKPLACE ROBERTO ESSES Country Manager of Gympass Mexico

Q: What are the main advantages gyms get from allying

to revolutionize how inactive employees engage in

with Gympass?

physical activity, driving lasting behavioral change. We

A: Gympass is the best way to attract corporate users. We

will continue to offer universal access for all employees

understand companies have many needs and nuances, which

across client corporations to engage in a physical activity

makes closing deals with them difficult for individual gym

program that drives employee engagement, improves

owners or managers. That is why we have a dedicated team

individual performance, attracts the best talent and enables

focused on this, while our partner gyms and studios focus on

business success. 249

providing their best service and retaining their new users. We are able to create a win-win partnership because companies

We also want to identify continuous opportunities with

invest in the Gympass program while we provide a large influx

gyms and new partners to accelerate the fitness industry’s

of new corporate members who benefit from attractive prices.

growth, resulting in new active users for our global fitness

Therefore, our fitness partners benefit from more users and

partners. When it comes to technology, we want to make

increased revenue through expanded corporate penetration.

major enhancements to our product and technology for

Approximately 1.4 billion people worldwide, equivalent to 28

a more personalized user experience, making it easy and

percent of the population, are inactive and we are focused

motivational for employees to become active. We are also

on these people. According to an internal study, 67 percent

improving customer experience by enhancing our portals,

of Gympassers in Mexico were not members of any gyms or

dashboards and user insights. Gympass will also invest

studios before enrolling in one of our plans, which means we

in new initiatives to attract new talent, as well as retain

increased the size of the market as a whole.

the highest quality people within our team. Lastly, this investment will fuel our expansion into new geographic

Q: How is Gympass increasing awareness of the importance

locations on the Gympass roadmap.

of fitness among its corporate users? A: According to WHO, physical inactivity is the fourth-

Q: How can a healthcare model that fosters prevention

leading risk factor for mortality. In 2018, it launched the

benefit Mexicans?

Global Action Plan on Physical Activity (GAPPA), a plan

A: ‘Prevention is better than a cure’ is a well-known saying.

to help countries scale up policy actions to promote

The truth is that preventing diseases is healthier, and much

physical activity. Gympass was invited to join one of these

cheaper, than curing them later. We have already noticed

multisectoral workstreams. This group has held a few

this among some of our clients who affirm that there needs

meetings already and will meet again in 2H19. The objective

to be a holistic approach to well-being, integrating mental,

is to discuss how we can help increase levels of physical

emotional and physical health. We decided to focus on

activity globally. Everyone knows exercising is good but

corporations because we believe companies are in a unique

almost no one does it. Why? We have learned that it is

position to foster prevention by encouraging a more active

because there are several emotional and physical barriers

lifestyle. Companies have massive reach, influence and

that make it hard for people to become active.

credibility with their employees and they can also create a social context in which good experiences are shared within

Q: How will Gympass’ recently raised US$300 million in

the company.

funding influence the company’s expansion plans? A: This funding will bring expanded benefits to global clients, users and fitness partners across our three-

Gympass is a global network that groups gyms and academies

sided marketplace through companies, gym partners,

under one membership and single platform. It is present in

technology, people and expansion. We want to double

7,960 cities and has 500 gyms and sport centers with more

down our approach as a B2B benefit, helping our clients

than 899 physical activities and classes registered

| VIEW FROM THE TOP

THE IMPORTANCE OF WELL‑DEVELOPED CHANNELS FOR COSMETICS ALEJANDRO LÓPEZ Director General of IM Natural

Q: What are the main challenges IM Natural is encountering

US, Guatemala, Colombia, Australia, Ecuador and Spain, to

given the country’s economic and political landscape?

which we ship around 5 percent of our total production.

A: The cosmetics industry develops indispensable goods.

250

Both men and women use these treatments to enhance

Q: What products do you manufacture for other brands?

their physical appearance and to consequently feel better

A: We both manage and are direct distributors of some

in terms of self-care and self-esteem. The industry is in

product licenses for other brands like Hello Kitty and Hot

a latent state like other economic and industrial activities

Wheels for children, and Chivas and America for soccer fans.

in the country due to the existing uncertainty resulting

We are working toward the acquisition of more licenses as they

from the new administration’s public policies. The industry

have become an interesting development for our company.

is experiencing an economic deceleration rather than a recession. Our sales have decreased and the entire

Our distribution channels are well-established and attractive

cosmetics sector is contracting. This economic situation

for foreign companies because they are aware of our reach.

is a detriment to our providers because lower production

This distribution is carried out through supermarkets like

represents diminished demand for supplies and raw

Walmart, Chedraui and pharmacies like Benavides. Our clients

materials. This situation eventually transforms into a cycle

know that they will be able to reach their market through

and we need greater trust in the government to handle

our products. Despite managing the makeup segment, we

public policy more efficiently.

have also been managing other markets for drugstores and naturist retail for almost 30 years. Department stores like

While our most important market is self-service stores,

Liverpool and Palacio de Hierro are also have us on their radar,

they are also suffering from this economic deceleration

even though they are not our primary market.

and decreased demand. We need to restructure our sales strategy to find new ways of negotiating with our main

Q: What role will online distribution channels play in your

clients. We must also focus on adjusting our company’s

business in the short term?

industrial engineering to manage our expenses.

A: These channels will grow in importance by helping us create product awareness and reaching our final consumer.

Q: How has your company expanded its sales channels?

While we benefit from word of mouth, one of our plans is

A: We are expanding our exports and our manufacturing

to enhance our marketing efforts despite the tradition of

process. Final consumer purchases have been affected

cutting expenses in an economic crisis. We need people to

and regardless of our business plan, we have been forced

know our product more than ever.

to accelerate the processes for finding new distribution channels apart from those impacted by the economic

Q: What are your plans for targeting men?

uncertainty. We manufacture and brand products for

A: We launched a line for men four months ago. The

other clients aside from our own brand. Exports are also

products that have been most successful in this market

important for us because the Mexican banking system takes

are moisturizing and shaving creams, and products for

this kind of business activity into account when making

beards and mustaches. Our company is now undergoing a

certainty assessments. Our main foreign markets are the

knowledge development phase so we will probably wait to see the public’s reaction before launching another product. Overall, our company’s most important product is eyelash

IM Natural is Mexican manufacturer of innovative products for

mascara. Our brand is categorized as one of the most

the cosmetic and naturist industry for the care and integral

important mascara brands despite not being distributed

beautification of the body. It manufactures makeup, skincare,

in the market’s niche points alongside L’Oréal, Maybelline

hair care and body care products

and MAC.

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FEMALE EMPOWERMENT DRIVES COMPANY SUCCESS MAGDALENA FERREIRA-LAMAS Vice President and General Manager for the Group of North Latin American Markets (NoLA) of Avon

Q: What makes Avon’s business model so successful in the

emerging ingredients for hair care. For example, we launched

Mexican market?

a shampoo with Chili extract, specifically for Mexico.

A: We started with a few products and only a small number of representatives and now, 90 percent of our beauty

We also try to offer affordable prices. One example is the

products enjoy a leading position in the Mexican market.

second edition of Avon Life, a premium quality fragrance

When people think about beauty, they think about Avon.

launched in an alliance with KENZO. Though the average

But our company is not just about beauty, it also stands

retail price of such a product is MX$1,200 (US$63.2), we can

for empowering women. For over 130 years, our model

offer a fragrance of the same quality at MX$500 (US$26.3).

has been to sell products through independent female representatives, which has been very successful in Latin

Q: How is Avon’s philosophy of “Beauty with a Purpose”

America. Having a conversation with another person about

reflected throughout its value chain?

beauty and tips is very effective among Latin women.

A: Last year, we tested the work climate at our plant in

We give our representatives training but allow them to

Celaya. Approximately 92 percent of the people declared

follow their own business path. Making their own choices

that they were very proud to work for Avon, which

and giving them their own income has transformed their

shows the level of commitment our people have with the

lives. Today, female empowerment is fashionable in every

company. Thanks to our empowering business model,

company. For us it has always been our purpose.

people at every level of the company feel like they have an impact on society. Many of our representatives do not have

Q: What role has your plant in Celaya played in growing

a higher education and did not have access to an income.

your presence in Mexico?

Their love for the job translates into quality and dedication.

A: At our Celaya plant we manufacture products for skin

We do have elements we need to improve. However, we

care, body wellness, makeup and fragrances. It is the second-

continue to work on the journey of these representatives,

most important plant in the world for Avon. These products

always adapting to new opportunities and challenges.

are exported to different countries in Latin America. We still develop our products at our site in Suffern, New York.

Q: Avon supports causes related to breast cancer and

However, we recently inaugurated an R&D laboratory in

domestic violence against women. How have these causes

Celaya. It will focus on developing products based on local

been addressed in Mexico?

market dynamics, trends and consumer preferences. The

A: We have an active role in preventive action against

team will develop and test products to ensure they meet

breast cancer among the Mexican population. In our

Avon’s safety and quality standards, while also meeting

brochures and videos, we always include topics related

the Mexican consumer’s expectations and desired benefits.

to our foundations and how people can offer their support. We participate in events in Mexico City and the Bajio

Q: How have you adapted your offering to trends in the

and we have made frequent donations to organizations

beauty market?

involved in this area. We also approach young breast

A: We see interesting trends among Mexican women, who

cancer survivors who get the opportunity to be mothers

focus on internal and external beauty. Makeup boosts

despite their treatments.

confidence and remains very fashionable. In 2017, we launched a new brand of makeup called MARK, with new colors, such as brown, violet and blue. These are designed

Avon is the fifth-largest beauty company in the world with

to offer a choice for women of all walks of life and ages. The

more than 130 years of experience and 63 years in Mexico.

brand adapts well to the taste of Mexican woman, giving

Avon’s recognized products and brands include: ANEW, Avon

a wide variety of options for everyday use. There are also

Color, Avon Care, Skin so Soft and Advance Techniques

251

| INSIGHT

POSITIONING BIOTECH FOR WELLNESS ANTONIO CRUZ CEO of Kurago Biotek

A growing segment of the population is favoring natural

The challenge that functional food companies face in Mexico

alternatives that promise to increase overall wellness and

lies in being able to explain in a simple way what it entails. “It

health over traditional pharmaceuticals, says Antonio Cruz,

is a very complex topic with many layers,” Cruz says. Although

CEO of Kurago Biotek. “We are developing food fermenting

the functional foods trend in Mexico remains a small niche,

agents for different types of products, such as smoothies,

Cruz says that Sanfer has become its largest client. “We

juices or jelly. The idea is to offer natural, regional and seasonal

expect functional products to become the unit within Sanfer’s

foods that stray from traditional pharmacology.”

structure that starts to gain ground in the health prevention

252

and wellness area.” Kurago Biotek, a Mexican biotechnology company that strives to improve health and nutrition through functional foods and

While pharmaceutical companies have yet to embrace this

innovation in the field of beneficial bacteria, has been in the

trend in Mexico, Cruz says that academia has taken the lead

market since 2004. In 2017, COFEPRIS finally recognized the

and is constantly developing research in this area. UNAM,

unique niche in which it operates, says Cruz. “The category

Tecnológico de Monterrey, University of Guadalajara, the

of functional foods, in which we operate, is not regulated in

Metropolitan Autonomous University, the National Polytechnic

Mexico as it is in other places like Japan or Europe. However,

Institute, the CIATEJ Jalisco and the Research Center for

in 2017, after several attempts, we were able to convince

Alimentation and Development (CIAD) are involved in related

COFEPRIS to open a new category of biotechnological foods

research and are cooperating with Kurago Biotek.

that encompasses non-alcoholic ferments. That is where we have accommodated our last four products.”

Cruz acknowledges that there is still a long way to go for its products to reach mass consumption, but the integration

Although functional foods are still in the process of

of the wellness concept in stores such as Sanborns and

gaining traction with Mexican consumers, Cruz says that

Farmacias San Pablo is helping the company to market its

pharmaceutical companies in Europe are taking advantage

products more effectively. “Farmacias San Pablo is developing

of the growing number of people who do not like taking

a new format for preventive health and wellness in which it will

antibiotics and look for a preventive way to restore their

display products that are oriented toward nutrition but that

health to add new categories to their product portfolio. “It

have a technological value. Sanborns is launching a similar

is becoming more common for pharmaceuticals to generate

project and Farmacias del Ahorro is also in the process of

new divisions such as medical nutrition,” he says.

generating a similar scheme.”

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FIGHTING BLINDNESS THROUGH CONSTANT INVESTMENT ALFONSO VENTURA Director General of APEC

Q: How have APEC’s operations evolved in Mexico?

Q: How would you describe the general status of visual

A: We are a nonprofit, privately-run organization focused

health in Mexico?

on eye care. Our mission is to help those who have limited

A: There is still a lot to do in terms of visual health in

resources to gain access to the best treatments. We

Mexico. One condition closely linked to blindness is

founded APEC, Hospital de la Ceguera in Mexico City 101

diabetes, which is a growing problem in our population.

years ago and its operations can be divided according to

Our biggest priority is to give as many people as possible

three pillars. The first is clinical care. We offer approximately

access to eye care and treatment. About eight out of 10

230,000 consultations a year, conduct 160,000 diagnostic

people could have their eyesight problems resolved if

studies and complete 11,000 surgeries. We seek to have the

they went to see an ophthalmologist.

most advanced technology. Our second pillar is education. We are a teaching hospital, meaning we are a place where

Cataracts are the primary cause of reversible blindness

the next generation of ophthalmologists is trained in 13

in this country. Two years ago, to mark our 100-year

different specializations. The last pillar is research. We have

anniversary, we took action to drastically reduce the

a center where we work to develop the science of visual

costs of our cataract treatments. We reinforced this effort

health and contribute to new technological development.

through a campaign called Adiós Catarata (Goodbye

Combining these three pillars, we are an institution by

Cataract), which set specific targets regarding the

society for society with a mission to improve visual health

number of surgeries we want to do. We have also decided

in this country.

to open new clinics for the first time in our history to bring care closer to our patients. We are starting in

Q: What is the course structure as a teaching hospital and

Mexico City and gradually moving on to other states. We

what role is technology playing?

also have been working with partners to make 2020 the

A: We teach three years of ophthalmology, followed by

year in which every Mexican goes to the ophthalmologist

one or two years of specialization in a particular area. Our

at least once.

training focuses on providing students with the skills to diagnose and treat patients effectively. Over their five-year

Q: What are APEC’s main goals for 2019-2020?

experience, we hope students develop strong social values

A: We are working on opening the first pediatric clinic for

and implement them in their own career. Because of our

retinal treatment in Latin America at our hospital. This

long history, a large percentage of ophthalmologists in this

will ensure that 2,000 children a year receive treatment

country received training at our hospital. Many still have

to cure their blindness from doctors who went abroad

strong ties to us and many have continued to work at our

to receive special training. The second goal is to open

hospital.

our first clinics in new locations to cover each area in Mexico City. Our mission will always be to provide the

We invest in the newest technology to give our doctors the

best ophthalmological care to people with the fewest

best tools. We now have the ability to use 3D visualization

resources. This will require continuous investment to

technology for retina operations. We are also looking at

make our treatments accessible and keep them at the

data analytics and artificial intelligence to improve our

highest standards.

diagnostic process. Knowledge in healthcare is constantly changing, so we must be mindful of what is happening around us and seek proper partnerships. We have exchange

The Association to Prevent Blindness in Mexico (APEC) offers

programs with world-class institutions, such as the Florida-

patients with limited economic resources medical and surgical

based Bascom Palmer Eye Institute, to foster a continuous

ophthalmological care of the highest quality. The association also

exchange of expertise.

organizes campaigns to raise awareness about visual health

253

LEGAL LANDSCAPE

New governments strive to introduce new ideas and tackle what they perceive as gaps or weaknesses in the regulatory framework. With the advent of the LĂłpez Obrador administration, the health sector has witnessed the revocation of cannabis permits, the re-organization of the medicine supply chain, openness to international companies to participate in tenders and other legal changes that are pushing companies to find new ways to do business while discovering new opportunities to tackle. As these changes consolidate, national and international companies will require solid understanding of the regulatory environment that only legislative experts can provide.

This chapter will analyze the coming changes in the regulatory landscape and what companies must do to adapt. Lawyers, consultants and authorized third parties explain what this environment entails and how companies can benefit, especially if they ground their strategies in deep knowledge regarding the countryâ&#x20AC;&#x2122;s regulations.

255

CHAPTER 12: LEGAL LANDSCAPE

258

VIEW FROM THE TOP: Ignacio García-Tellez, KPMG in Mexico

259

VIEW FROM THE TOP: Ernesto Algaba, Hogan Lovells in Mexico

260

Fausto Ávila, KPMG in Mexico

Cecilia Stahlhut, Hogan Lovells in Mexico

VIEW FROM THE TOP: Bernardo Martínez-Negrete, Galicia Abogados

Lisandro Herrera, Galicia Abogados

261

VIEW FROM THE TOP: Fernando Becerril, Becerril, Coca & Becerril

262

VIEW FROM THE TOP: María Del Mar Deza, ATP

263

VIEW FROM THE TOP: Alejandro Luna, Olivares

264

VIEW FROM THE TOP: Laura Padierna, LEI

265

VIEW FROM THE TOP: Jaime Castro, BPF Part of QbD Group

266

VIEW FROM THE TOP: Carlos Pérez, NYCE

267

INSIGHT: José Alarcón, Anáhuac University

268

VIEW FROM THE TOP: Martha Valadez, TAAP

269

ROUNDTABLE: What are the Main Changes You Expect in the Regulatory Framework?

257

| VIEW FROM THE TOP

INDUSTRY CHANGES DEMAND NEW CORPORATE STRATEGIES Ignacio García-Tellez Director of the Health Sector at KPMG in Mexico

258

Fausto Ávila Audit Partner Specialist in the Health Sector at KPMG in Mexico

Q: How is KPMG helping its clients navigate the challenges

are increasing in incidence. This will continue to be an

and trends in the health industry?

important factor in the state of public health. Although

IG: KPMG in Mexico has a global network of advisers

it is unfortunate that there is a prevalence of such

and success stories around the world that supports

complex diseases in Mexico, this opens the door for the

organizations. We can provide information and consulting

pharmaceutical sector to develop increasingly innovative

on best practices that have led to strengthening health

therapies that improve people’s quality of life. We see an

systems worldwide. KPMG in Mexico has generated

opportunity to improve hospitals and clinics that already

solutions that help in terms of strategies, compliance,

have a staff, equipment and facilities of the highest quality.

administrative-legal issues and advice on analytical data

Opportunities will increase as different sectors generate

models to streamline supply chain processes.

incentives to attract investment. KPMG sees the greatest growth potential in the hospital sector, especially with the

FA: Another important issue for the health sector is

boom in medical tourism.

pharmacovigilance, which is in the process of changing due to the new structure for consolidated purchases. Players in

IG: The insurance sector is another area of opportunity

the pharmaceutical sector will have to redefine their roles

for the health industry. In conversations with KPMG, some

to ensure that medicinal safety is not affected.

companies have emphasized the need to generate more efficient and transparent payment models regarding

Q: How does KPMG support its customers in the process

hospital services and competitive fees with other providers

of launching new products?

such as laboratories. Considering that health expenditures

IG: KPMG assesses the company’s situation, analyzes the

are on the rise, the insurance sector will continue to be a key

population that it is planning to reach and understands

element to guarantee access to health services in Mexico.

the public policy contexts, trade risks and corporate goals.

We believe that in the coming years, insurance will become

Afterward, a detailed analysis on the available products in

a priority sector and a source of great investment attraction.

the market and the organization’s own portfolio is performed, highlighting how the new product will compete against similar

Q: What are your views on the development of the

solutions in terms of price. Over several sessions, KPMG and

pharmaceutical and medical devices sectors?

the company define an access and commercial strategy for

IG: Previously, sales in the pharmaceutical industry were

the product, considering the technical, scientific, corporate,

managed by distributors but companies must now

marketing and legal aspects that surround its release. In the

think about having direct contact with the government.

end, we deliver a report that companies can use to effectively

Meanwhile, data analysis within supply chain operations

communicate the value proposition of the new product.

is becoming a key competitive tool in a pharmaceutical company’s ability to determine which products should

Q: What are the challenges and opportunities that KPMG

be released to the market. It has become increasingly

sees for companies in the healthcare sector?

important for pharmaceutical companies to know what,

FA: The country’s epidemiological transition allows us to

where and when to sell to address patients’ needs.

know which diseases are more prevalent and those that FA: Regarding medical and pharmaceutical devices, it is vital for companies to have executives who are capable KPMG is a global network of professional services firms providing

of interacting with different players in the health sector.

audit, tax and advisory services in more than 153 countries and

Companies need professionals who know the technical,

territories across the world. It has over 207,000 people working in

commercial and scientific language and who have the ability

member firms and it belongs to the top 4 global consulting firms

to generate advertising with both private and public parties.

VIEW FROM THE TOP |

BIG DATA AMONG COMING GAME CHANGERS

Ernesto Algaba Partner of the Life Sciences Practice at Hogan Lovells in Mexico

Cecilia Stahlhut Senior Associate of the Life Sciences Practice at Hogan Lovells in Mexico

Q: Which trends has Hogan Lovells identified in the

CS: COFEPRIS is fully aware of the sale of counterfeit

Mexican healthcare sector?

drugs through social networks but the council needs more

EA: We have observed several trends, challenges

resources to deal with these problems. It is also necessary

and opportunities generated by the current business

to sensitize the general population about the risks of these

environment and the change of administration. There

medicines.

have also been changes in innovation within the industry and in the business of companies in the sector. Some

Food supplements also need to be addressed. These

trends that are widening are digital health, personalized

products are very popular among Mexicans but better

medicine and regenerative medicines.

surveillance is needed to guarantee their safety and efficacy. In Mexican culture, traditional medicine is based on herbal

For instance, sharing information through different public

medicines so Mexicans often accept herbal supplements

and private institutions that use Big Data will allow the

that, may offer no guarantees to consumers in many cases,

development of new access models for medicines, public

as they are not sufficiently regulated.

policies and will eventually change the sectorâ&#x20AC;&#x2122;s legal framework.

Q: How is Hogan Lovells capitalizing on its 70 years of experience to help his clients address regulatory challenges?

CS: The use of Big Data could even allow a better use of

EA: Our clients are now accompanied by specialists who

public funds. Proper use of the electronic clinical file will

guide them through each process. A period of change and

shorten wait times and reduce costs related to doctor

uncertainty is looming and, although we cannot predict what

visits. Technology is being used to simplify care in many

is coming, we do know in which areas our clients will need

different ways, from providing direct care through an app

help. Our role has changed in recent years. We must be highly

to personalized medicine. However, the more technology

proactive in the added-value services we provide our clients,

advances, the more we fall behind in regulation. For instance,

as that will allow them to achieve their objectives within the

regulation created four years ago no longer covers current

legal framework.

technology. It will be a challenge for the new administration to create a legal framework for these new technologies.

CS: The new administration has expressed its intention to reduce the budget for healthcare, adding that the

Another important trend that will impact the healthcare

pharmaceutical industry must reduce the cost of medicines.

sector in the following months is the discussion regarding

This decision is part of the administrationâ&#x20AC;&#x2122;s strategy to

the regulation of Cannabis and its use in Mexico.

eventually provide free medicine to the population. This period will introduce challenges to the Mexican pharmaceutical sector

Q: What regulatory changes would you recommend

as it will be affected by the extension of copyright protection

to reduce the prevalence and impact of counterfeit

for biotechnological medicines and the incorporation of new

medicines?

players. Taking into account this scenario, the industry should

EA: This is an issue that must be addressed by all

look for new opportunities, such as cannabis products and

members of the supply chain. It is also necessary that

high-end products, services and technologies.

the federal government makes this issue a priority, since black-market medications place the general population at risk. While regulation concerning counterfeit medicine

Hogan Lovells is an international law firm with over 40 offices

is clear, we need better enforcement through proper

and more than 2,800 lawyers around the world. The firm

coordination of sanitary, customs and other authorities

specializes in several different industries, including aerospace,

at all levels: city, state and federal.

automotive, consumer goods, life sciences and real estate

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SUPPORTING PHARMACEUTICAL COMPANIES IN AN UNCERTAIN CLIMATE Bernardo MartĂnez-Negrete Partner at Galicia Abogados

260

Lisandro Herrera Associate at Galicia Abogados

Q: How ready are the market and regulators for the

Q: With the current sociopolitical challenges, what concerns

potential legalization of cannabis products for medical

do pharmaceutical companies have and how is Galicia

and industrial applications?

Abogados supporting them?

BM: The proposed regulatory changes concerning

BM: The main concern is legal certainty. Every company that

marijuana remain in the initial stages but we believe its

works with the public sector requests legal agreements to be

legalization, both for recreational and medical uses, will

honored, especially for long-term contracts. The government

move forward because the party that backed the initiative

is a key player in the acquisition of healthcare products.

has a majority in Congress. Many foreign companies from

Given this new governmentâ&#x20AC;&#x2122;s tendency to revisit or re-open

countries where marijuana is legal are already showing

long-term contracts, we are assisting clients in understanding

interest in this market and looking for ways to enter

their legal alternatives and protections in case of changes in

Mexico to eventually commercialize their products.

laws or early termination of such contracts.

The challenge is to establish public policy concerning marijuana use because its legalization will require the

LH: The new administration says that strengthening local

creation of awareness programs related to risks and

manufacturing is a goal but it is unclear how it plans to do

addiction.

that. The industry does not want to return to the days when international companies had to establish a manufacturing

LH: Its legalization will lead to a larger offer of

facility in the country. This is problematic for international

pharmaceutical products containing cannabis, which will

companies because the supply system has changed and

create direct competition with current pharmaceuticals.

international companies manufacture a product in one or

Their entrance into the market will mean more options

two facilities for the rest of the world.

for patients. Cannabis products now fall into the psychotropics and narcotics categories in the General

Q: Considering the uncertain climate permeating Mexican

Law of Health.

industries, how do you expect the health market to behave in the short term?

Q: The new USMCA proposes increasing the timeline of

LH: The industry will continue growing in line with the

intellectual protection for biotechnological products.

demand for medication related to epidemiological trends,

What ramifications will this have if implemented?

such as the diabetes and obesity epidemics. As a result,

LH: The current text of NAFTA 1994 states at least five

government programs that address these issues must

years of protection for clinical data, including biological

continue, although we are uncertain of what shape these

products; the text of USMCA increases this time to 10

programs will take.

years. This is a benefit for the original manufacturer to compensate for the great investment made to develop

BM: We do not expect changes in pharmaceutical sales

a new medicine. The scope of protection is not new, it

to the private sector as it is diverse with a broad range of

has been there since 1994, therefore there should be no

consumers. This sector will continue along its current path as

relevant impact on the local industry, since companies

long as regulations concerning pricing, sanitary registration

will have to continue generating their own clinical data.

and import regulations do not change. In fact, the private market might continue growing as the population gets older because more medical services are required as people age.

Galicia Abogados is a Mexican law firm founded in 1994. In

However, the uncertain climate is causing Mexican sovereign

healthcare, it works with pharmaceuticals and medical devices

debt to become more expensive, which may eventually

companies and specializes in M&A, regulations for the sale,

create a shortage in the federal expenditures budget and,

publicity and distribution of generics and patented medications

therefore, an impact in sales to the public sector.

VIEW FROM THE TOP |

ENFORCE INTELLECTUAL PROPERTY RIGHTS TO CREATE ECONOMY OF INTANGIBLES FERNANDO BECERRIL Former President of the Mexican Association for the Protection of Intellectual Property (AMPPI) and Partner and President of Becerril, Coca & Becerril

Q: As the former President of AMPPI, what professional

Q: What is the profile of the entrepreneurs that Nivel 72

profile would you say AMPPI is looking for to gain a

likes to work with?

comprehensive view of the country’s needs?

A: We have not defined a specific profile. If we were to work

A: What AMPPI has been looking for is to diversify its

to a profile, many companies would be left out. However,

membership to get closer to the industry related to

we do have some minimum requirements. We conduct a

intellectual property. Almost all of AMPPI's members are

technological evaluation, and in some cases, we even take

lawyers from different firms that are also consultants on

on some of the risk while in others, we help them obtain

intellectual property, but we have few company lawyers.

public funds. We look for projects that are scalable and

Including company lawyers gives us a broader vision in

viable or that we perceive as interesting.

terms of what intellectual property is. Traditionally, we view intellectual property from a lawyers’ perspective

Q: What are the main challenges regarding intellectual

but the industry as a whole analyzes the topic as it

property protection in the pharmaceutical industry?

relates to protecting rights and obtaining a better return

A: The persistent challenge in the pharmaceutical industry is

on investment. By broadening our membership profile,

how to enforce intellectual property rights in Mexico. While

we broaden our vision and can start working on how to

companies might hold the patent for their products, the

approach the topic not only from the side of protection

moment there is an illegitimate use of a patent, it is very hard

but also from the side of profitability and generation

to demand protection of rights. We have seen a reduction

of economic benefits as a result of all these innovative

in the number of patent applications in Mexico from the

processes in R&D. This means that we analyze intellectual

pharmaceutical industry, which is the result of the perception

property not only from the legal protection side, but as

that it is hard to enforce intellectual property rights.

an intangible asset to generate business. There is a persistent idea that the violation of intellectual Q: How does Becerril, Coca & Becerril contribute to

property rights only happens with movies and music. While

achieving AMPPI’s vision?

it is true that piracy impacts many industries, pirated health

A: We have worked with the industry for several years. In

products can be fatal. Medicines and food supplements in

2018, we acquired a civil law firm that expanded our offering

unregulated and informal businesses put people at risk and,

beyond intellectual property to include corporate, civil,

unfortunately, there is no real and clear action to combat

commercial and family law. Also, three years ago we founded

these activities.

a company called Nivel 72, which provides support and assistance specifically to newly-created businesses. Nivel

Another topic that has come up recently is related to

72 accompanies new businesses throughout the strategic

pharmaceutical products. There is talk of modifying patents

planning stages, including the definition of a business plan.

and limiting the protection for certain pharmaceutical patents

In the entrepreneurial ecosystem, entrepreneurs have a

to make them more easily available to the population. We

great deal of enthusiasm but lack operational fundamentals.

have to be careful not to disrupt what we have achieved in

The idea is to help entrepreneurs direct their focus so they

terms of protection of intellectual property rights, particularly

can create a profitable and sustainable business.

in the health sector.

In some cases, we have supported our clients in the commercialization process for their technology. We have

Becerril, Coca & Becerril is a Mexican law firm established

a technology transfer office certified by CONACYT and we

in 1969. The firm specializes in intellectual property and

have helped many companies with the process of requesting

provides consultancy services for patent applications for the

and implementing public funds to generate results.

pharmaceutical, chemical and electrical sectors, among others

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SOLUTIONS THAT FIT CLIENT NEEDS MARĂ?A DEL MAR DEZA Former Director General of ATP

Q: What are the advantages of working with an authorized

Nutritional supplements are subjected to the most

third party in advertising?

advertising restrictions and those companies that try to

A: The main added value we offer is our consulting service.

regulate their advertising are frustrated by the limitations

We are not part of the government; we are a private

of what their advertising can and cannot include. It is a

company working on solutions for our clients. We work

problem for COFEPRIS and the industry.

according to the needs of our customers, advising them

262

on what they can and cannot include in their advertising

Q: What could be done to improve advertising regulations?

to ensure that they communicate correctly and efficiently

A: An anonymous reporting system allows those who detect

the information they want to deliver about their products

deceptive advertising to report it to COFEPRIS but that is

or services.

not enough given the volume of advertising. COFEPRIS would need a huge team to supervise all the publicity

Q: Last year, you highlighted a lack of information regarding

from the 16 segments it regulates. As a result, authorized

advertising processes. How does ATP see the situation now?

third parties become the support that COFEPRIS needs to

A: The process is improving but there are still obstacles

regulate advertising and allows the authorities to focus on

that limit its acceleration. One problem is the lack of

other regulatory matters.

knowledge related to compliance with good advertising practices. Companies believe that if they have not been

This year, we received a spike in requests for our services

fined by COFEPRIS they are not obliged to regulate their

from beauty clinics that had been notified by COFEPRIS.

advertising.

When we reviewed the announcements, we realized that the clinics could not back up their advertising claims. There are aspects of advertising regulation that could be improved

AutorizaciĂłn de Terceros en Publicidad (ATP) is certified by

through synchronization with other countries because

COFEPRIS to assist in the control of advertising of medicinal

when companies arrive to Mexico they must undo their

goods. It provides consulting on medical devices, supplements

previous advertising and create new campaigns, which is

beauty services and procedures, health services and medicines

very expensive.

VIEW FROM THE TOP |

INSURING IP THROUGH TRADE TREATIES ALEJANDRO LUNA Partner litigation and Life Sciences Co-chair at Olivares

Q: How did Olivares enter the life sciences field and in what

the obligation to recognize data package exclusivity

areas does it operate specifically?

for over 25 years. However, there were no local laws or

A: Olivares was one of the first law firms in Mexico to have a

regulations in Mexico put in place to recognize and enforce

team fully focused on the life-sciences sector. This department

these rights. Therefore, innovators were bound to file

grew thanks to our experience in IP litigation, especially in

legal actions to obtain the recognition of data package

the enforcement of pharmaceutical patents. Furthermore,

exclusivity of innovative products. The implementation

there was a need to explore venues other than traditional IP

of the new IP rights would benefit all stakeholders in the

proceedings to address actions such as removing infringing

pharmaceutical industry.

and substandard products from the market. This required expertise in the legal framework of pharmaceutical approvals.

The IP law must be amended to create a venue of civil

We are pioneers in several topics, such as patent term

remedies for the violation of patents and trademarks,

corrections of linked patents, invalid actions against marketing

instead of having to wait for a final decision of infringement

approvals that violate the Health Law and regulations, and

proceedings. There are suggestions to provide jurisdiction

regulatory or data package exclusivity.

to the Mexican Patent and Trademark Office (IMPI) so that they can award damages. This will not work because as an

Q: How can the industry protect itself against COFEPRIS’

administrative agency, IMPI’s authority will be questioned

delays in approvals?

when awarding damages. Instead, jurisdiction should be

A: For many years, delays were not a matter of concern in

provided to the Mexican Civil Courts, both federal or local,

Mexico and we expect that during the current administration

to analyze the violation of IP rights and award damages.

they will also not be an issue. However, there are some legal grounds and actions we can use to encourage authorities

Q: How will the proposed modification to the Mexican

to comply with the terms provided in the law, international

Health Law to reduce the scope of the linkage system for

standards and treaties. There are international treaties, such as

pharmaceutical patents affect the pharmaceutical sector?

the USMCA, CPTPP and the Free Trade Agreement between

A: This proposal aims to limit a patent to its active

Mexico and the European Union, which establish compensation

pharmaceutical ingredient (API) and is a significant step

mechanisms for unreasonable delays in regulatory approvals.

backward in IP protection. Moreover, it is anti-constitutional

Regardless of any current or future policy, Mexico has a strong

and breaches international agreements, especially CPTPP.

legal framework for investment, innovation and production.

Regulations cannot be limited to one patent per product as

International treaties will lead to changes in local law that will

the proposal suggests. The patent linkage system has proven

make Mexico even more attractive for innovative companies.

to act as a deterrent to potential patent infractions. It is not a barrier to generics. Mexican negotiators fought for the patent

Q: What are the pharmaceutical industry’s main challenges

linkage system during the negotiation of CPTPP and USMCA,

regarding the regulatory and IP legal framework?

and this recent reform proposal aims to erase all these efforts.

A: Based on the recent international treaties, there are many

Improvements in the patent linkage system could include

commitments made by the Mexican government to improve

assigning rights and obligations to interested parties, which

IP rights, for example the package of pharmaceutical

are the patent owners and generics manufacturers.

patents. The most significant areas are patentable subject matter, regulatory protection, patent linkage and the compensation of patent terms.

Olivares is an intellectual property (IP) law firm that works with some of the world’s biggest brands. It specializes in areas such as

The main challenge will now be to implement those

patents, trademarks, copyright, IP and civil litigation, regulatory,

commitments in the domestic laws. NAFTA included

administrative and constitutional law

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FOSTERING INNOVATION THROUGH TRAINING LAURA PADIERNA Director of the Biological Applications Business Unit at LEI

264

Q: What makes LEI the ideal partner for a company

Q: What actions is LEI taking to strengthen the knowledge

that wants to launch a product and needs to conduct

of its researchers and other professionals within its team?

specialized studies?

A: LEI has a rigorous training program that includes formal

A: Our company has the ability to adapt its services to cover

exchanges with universities to study masterâ&#x20AC;&#x2122;s or doctorate

the necessities of the client. We add value through our logistics

degrees. At the same time, every leader in a particular field

infrastructure, experience and knowledge of international and

will choose the areas that require further training to maintain

national norms. We always put our client at the center of our

the latest standards. We also conduct impact studies in

processes. An important characteristic of our company is that

collaboration with universities, specifically because we value

we have a highly skilled team with expertise in diverse fields.

the asset of scientific understanding from a business point of view. Those who participate in these programs attend

Q: LEI was created to offer technological solutions to

conferences, collaborate on the publication of articles and

pharmaceutical and biotechnical companies. What are the

acquire corresponding degrees. We always encourage our

main challenges these companies encounter in Mexico?

employees to participate in courses, events and conferences

A: An important challenge is to unify the sector and have

in their respective fields to ensure that they stay up to date

a stronger voice to express the needs of the sector to

with the latest developments. One of our strengths is how we

relevant authorities. The conflicts of interest that exist among

translate this new knowledge into the further improvement

decision-making entities also need to be resolved. However,

of our services and the creation of new services.

we are pleased to see that COFEPRIS is taking action in this area. Conversely, there are many companies in Mexico

Q: Which recent developments in the field of

that are not making significant investments or taking risks to

pharmaceutics and biotechnology have presented the

develop new products, which are also aggravated by conflicts

most opportunities for LEI?

of interest. There needs to be an accurate analysis of how the

A: One of the products of our collaboration with universities

T-MEC negotiations are going to affect the manufacturing

and companies was a cellular therapy for the treatment of

of generic medications and biocomparables; for example,

laminitis in horses. There is no effective treatment for this

in the area of patent expiration of innovative medications.

disease, other than palliative medications that temporarily ease the symptoms. Our proposal is a therapy that lessens the

Q: What is LEIâ&#x20AC;&#x2122;s most recent success story in Mexico?

symptoms by about 80 percent. With three applications, the

A: In 2017, after the earthquake in Mexico City, there was

horse can return to an active life without suffering pain. With

an urgent need for a medication used to treat tetanus. At

the help of partner suppliers, the proposal was developed by

the time, trials were being carried out on animals. Given

Mexican scientists who used our installations to optimize it.

the urgency, we developed a method that was able to compare the medication against a standard to determine

Q: What are the main international trends that are changing

its effectiveness. The development and validation were

the pharmaceutical and biotechnological industry?

reached in a shorter period than usually required to

A: There are advanced therapies including gene therapy,

complete animal testing, allowing the medication to reach

cellular therapy, tissue engineering and combinations of

those affected by the earthquake.

these. These are more personalized and do not have as many secondary adverse effects as traditional treatments. In the area of development and quality control of cosmetics, medical

Laboratorios de Especialidades InmunolĂłgicas (LEI) is an

devices and medications, we are seeing the substitution

authorized third-party company that offers innovative studies

of animal testing with in vitro methods. We are looking at

on quality control, specialized studies, stability protocols,

increasing the use of organoids for the testing of medications

veterinarian services, clinical analysis, R&D and more

that are in development.

VIEW FROM THE TOP |

REGULATORY PARALYSIS HINDERS TECHNOLOGY ADOPTION JAIME CASTRO Director General of BPF Part of QbD Group

Q: What trends does BPF, Part of QbD Group, perceive in

not work. We need to evaluate the risks of the technology

the health sector and what regulatory concerns could arise

used by startups and it might even be necessary to put

from these trends?

more controls at a technical level to ensure the quality

A: We are witnessing technology trends such as AI, virtual

of the products these startups are producing. However,

reality, nanotechnology and additive technology, as well as

putting up regulatory barriers only discourages the

Advanced Therapy Medicinal Products (ATMP). CONACYT

development of new technologies.

has an area in Guadalajara in charge of developing these new therapies and so far, it has delivered good results.

Regulatory changes must be accompanied by a long-

Effective ATMP research could pave the way for the

term country vision. Technology is always one step ahead

implementation of other technologies in the country related

of current processes and regulations, so new rules must

to biotechnology and genetics therapy, among others.

encourage technology development. CONACYTâ&#x20AC;&#x2122;s budget cuts make no sense because of that very reason.

QbD Group is leading the charge in the research of these new technologies, especially in ATMPs. We have developed

Q: How has the industry reacted to changes in regulations

a partnership with Antleron, a company that specializes in

and what can the government do to boost certainty

the development of gene therapy and microprocesses for

among investors?

these therapies. Our partnership focuses on Cell by Design

A: The way in which many government policies have been

(CbD), a cloud-based software platform that facilitates

conducted has hindered the needed certainty for the

scalable, cost effective and sustainable ATMP process

creation of new businesses, employment and investment.

development and disruptive capsules that work as micro

We have seen cases such as pharmaceutical vetoes,

factories that produce genetically-manipulated cells. Being

which have not been cleared, while public declarations in

a genetics-based therapy, patients have a cell-generating

newspapers without any evidence have generated losses

capsule specifically designed for them. By using CbD, it is

for companies and has led to an uncertain environment.

possible to build a design space of the process and product and to apply cheaper parametric releases compatible with

At the same time, COFEPRIS is semi-paralyzed and its

Industry 4.0 standards, including remote monitoring and

authorities have gone back and forth with some changes

control and efficient data capturing and storage. This way

that have not convinced everyone in the industry. During

of working facilitates process automation and allows for

past administrations, COFEPRIS had managed to create

the implementation of machine learning methods and

an image and strength that transcended the local market,

predictive modelling. We are exploring the possibility

garnering praise internationally. This helped to position

of introducing these new technologies to Mexico, either

Mexico as a reference point in healthcare, particularly

through a partnership with a local player or directly as

in Latin America. However, these latest changes have

new players.

put Mexicoâ&#x20AC;&#x2122;s leadership position at risk, especially since there is no clear public policy of where we are going as

Q: What should be the balance in terms of regulation for

a country. Having said that, I hope things will take a turn

startups and for established companies?

for the better in the coming months.

A: The country lacks a long-term vision that makes technology the cornerstone for industry growth in pharma, and in healthcare in general. There are very few technology-

BPF Part of QbD Group , is a Mexican and multinational

based health startups in Mexico and unfortunately, the

consultancy company that works on validation and good

government and regulations have always treated them as if

practices for the healthcare sector, particularly in pharmaceutical,

they were larger and consolidated companies, which does

medical devices, logistics and biotechnological areas

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THIRD PARTIES CAN ALLEVIATE PRESSURE ON GOVERNMENT CARLOS PĂ&#x2030;REZ Director General of NYCE

Q: As an authorized third party, what is your relationship with

reputation of integrity is very important. There have instances

government regulators?

in the past been where we have encountered bad practices

A: We interact with many government regulators, although the

during our inspections, such as falsification of certifications or

particular body depends on the sector. In health, COFEPRIS

cheating during tests. The Mexican Accreditation Entity has

acts both as a regulator and as an inspection unit and we

a specific area that monitors and addresses these practices.

have operated according to its rules for many years. In some

266

areas, they remain the only authorized body for certifications.

Q: How are your operations distributed across the country?

We hope the government will soon open up these areas to

A: We have established branch offices in Mexico City, Tijuana,

authorized third parties.

Ciudad Juarez, Monterrey and Guadalajara in line with our clientsâ&#x20AC;&#x2122; demands. We are now looking at the southeast. In

Q: How could new government policies help NYCE broaden

Cancun, we already have a small presence that caters to

its service scope?

the tourist industry. We inspect hotels, restaurants and

A: Due to the restrictions the government places on third

other service establishments. If we were to start inspecting

parties, it is hard for companies like us to grow beyond their

and certifying pharmacies, we would need to shape our

niche. Luckily, we are part of a bigger group with different

infrastructure beyond just offices. In that way, we could cover

business lines. It is my understanding that this government

the whole country.

wants to make its spending more efficient. This could be an opportunity for the private sector to take on more duties

Q: What effect do quality control and vigilance have on the

that have been traditionally assigned to the government. We

pharmaceutical industry?

have the team, the facilities and the experience to expand

A: COFEPRIS has made a good effort to open up the market

in various areas. COFEPRIS has opened up several areas to

and attract more players. It has stimulated more production of

smaller new players, although not all private parties. This has

medicines and greater product diversity, which has increased

limited competition, which I consider a wrong approach.

medicine access for the entire population.

Private parties can do more professional and elaborate work.

Pharmaceutical is a strong sector. It continues to innovate,

We can broaden our portfolio to new factories, plants and

introducing new technologies, equipment and plants,

laboratories in all kinds of industries. We could even audit our

which means it also requires continuous inspection and

own competitors in the industry. Moreover, many pharmacy

recertification. Maintaining high-quality controls helps the

networks are in the process of expanding but only COFEPRIS

whole industry advance, allowing it to capitalize on the

is authorized to inspect these companies.

potential to export to international markets.

Q: How do you handle the potential conflict of interest that

Q: What are your growth expectations for authorized third

arises from having other commercial operations?

parties in the next 18 months?

A: It is important to maintain full impartiality in our work. For

A: There are already several players in our line of work; I am

this reason, we will never produce any products in areas where

not sure if there is space for more. Most authorized third

we also conduct inspections. In this business, upholding a

parties cover around 1-2 percent of the market. We are on the larger side, with approximately 3 percent of the market. This year, our goal is to grow 20 percent in size and increase

NYCE is one of the largest authorized third parties in Mexico.

our penetration by 2 percent. We have seen favorable signs

It supports companies in the certification of electronics,

in 1Q19 toward reaching this goal and we are certain that even

medicines, medical devices and food labels. NYCE has

though we will not become the biggest player, we will further

operated as a verification unit for 21 years

strengthen our position.

INSIGHT |

THE SIX FACES OF HEALTHCARE JOSÉ ALARCÓN Associate Professor Leadership in Healthcare Institutions at Anáhuac University

The Ministry of Health wants to compensate the lack

issues that are challenging the health sector. In this

of health coverage at public institutions and provide

analysis, the way the government sets its objectives and

healthcare access to those not affiliated with an existing

how it measures them will be key to ensure the health

program. However, in analyzing the government’s

system’s success. “Qualitative objectives are as important

proposal, José Alarcón, Associate Professor Leadership

as quantitative objectives because these show how long

in Healthcare Institutions at Anáhuac University, sees two

people are living and what their quality of life is like

main problems that could complicate the success of the

during those years,” he says.

initiative. President López Obrador ’s National Health Plan “Currently, around 20 million people have no access to

establishes a series of objectives to contemplate the

health services. So, the first challenge for this government

health of Mexicans in a more comprehensive manner,

is to locate these people and then discover what is the

establishing a preventive approach and considering

best way to affiliate them with its new program,” says

indicators such as socioeconomic deficiencies, nutrition

Alarcón. The second challenge is the health budget,

and physical activity, which would be in line with the

which appears to be insufficient to cover the cost of

proposed Cube of Health analysis. “It is a more integral

adding 20 million new affiliates to the system. “Today, 49

health model than before,” says Alarcón.

percent of the affiliates consume more than 60 percent of the health budget, so adding more people could become

In addition to having indicators to measure objectives and

financially critical,” says Alarcón. If IMSS’ per capita

being aware of the challenges ahead, Alarcón believes it

expenditure of MX$5,860 (US$307) is multiplied by 20

is important for the government to follow certain steps

million new affiliates, it would result in an extra budget

and take care of its processes to ensure success. “The

requirement of about MX$120 billion (US$6.3 billion). This

first step is to have transparency and a clear idea of

is added to the cost to cover existing affiliates, which

the current state of the infrastructure and conditions in

totals more than MX$397 billion (US$20.8 billion), while

public health,” he says. “The next part of the process is to

the current budget for healthcare services is MX$602

create a public-private network of healthcare providers to

billion (US$31.5 billion).

maximize coverage in Mexico. If successful, people would be able to go to any public health institution two or three

Alarcón emphasizes the importance of combining

years after the network’s implementation.”

qualitative and quantitative indicators to understand how healthcare services are performing among the population

Once the healthcare network is open to the entire

by applying the innovative Online Analytical Processing

population, the government’s focus could move from

(OLAP) cube, which performs complex multidimensional

infrastructure to healthcare provision. “The immediate

analysis of data. In this case, it would be a Cube of Health.

objectives would be to increase healthcare quality and

“The idea is to use the Cube of Health to understand

coverage, while implementing a patient-centric approach

the six dimensions that affect healthcare in Mexico and

to make sure Mexicans have an integral model of attention.

how the public sector can reach its goal of universal

If the government understands that the health system

healthcare.

is a multidimensional matter, as illustrated by the Cube of Health analysis, then it will achieve or at least move

The cube shows and explains how the health system is a

toward universal access to healthcare,” Alarcón says.

multidimensional matter that requires various solutions

“A holistic approach to healthcare can provide multiple

from different angles,” he says. The Cube of Health could

and integral solutions that will eventually lead Mexico to

help the government and the industry understand the

achieve a system like that in most developed countries.”

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CONSIDERATION OF COMPANY CIRCUMSTANCES CAN HELP IMPROVE PUBLICITY REGULATION MARTHA VALADEZ Director General of TAAP

268

Q: How have authorized third parties in advertising

Q: What is TAAP’s strategy to succeed in the industry?

impacted the health industry and its patients?

A: TAAP works with companies of all sizes. However, the

A: When COFEPRIS opened the door for authorized third

secret behind TAAP’s success is targeting small companies

parties to participate in advertising-related topics, it eased

and entrepreneurs that cannot afford expensive solutions. The

authorization procedures for the entire industry. The industry

company believes young people are going to be major game-

relied on COFEPRIS to do all procedures and review all

changers in the health sector; we are supporting entrepreneurs

documentation. If a company missed a document or had

by providing tailor-made services. TAAP reaches potential

an error, it had to start the process from scratch. Authorized

customers through forums, events and expos, as well as

third parties have become the middle point between the

through social media. However, the company has found that

industry and COFEPRIS by allowing companies to review

the concept of authorized third parties is still incipient and

their procedures and ensure everything is in order. The main

many people are unaware of the regulatory procedures that

advantage of hiring an authorized third party is that all the

must be followed in the health sector.

procedures can be done online, helping save money and time. Q: María del Mar Meza, Director General of ATP, told us Q: How does TAAP differentiate from other authorized

COFEPRIS should implement fines depending on the size

third parties in advertising?

of the company. How would this affect small companies?

A: TAAP offers personalized attention and tailor-made

A: The General Health Law establishes that fines in advertising

solutions. The company reviews each project from the

should be based on the circumstances of the fault. So, before

very beginning when contacted by a client and has a team

issuing an infraction, the law considers the socioeconomic

fully trained in health services and medical devices. Most

condition of the infracted, probability of recidivism and the

of our clients are in the health industry, in comparison to

circumstances in which the infraction happened. However,

other authorized parties that have a stronger presence in

it is true that authorities need to improve their evaluation

the alcoholic beverages and food industry.

of socioeconomic conditions because most of the times they apply the same fine to all, regardless of the size of

Q: What are your priorities as new Director General of TAAP?

the company. In that case, a big company does not see a

A: TAAP’s priority is to focus on providing the best customer

big impact on its budget, but for small companies and

service. The company wants to continue improving its

entrepreneurs this could mean bankruptcy.

services based on official quality regulations and will complement its service with an ISO Certification in 2020.

Q: What are TAAP’s growth plans for the near future?

The certification is going to make TAAP an even more

A: During 2019, the company would like to position TAAP

trusted and quality-oriented authorized third party. Today,

as an authorized third party specialized in health services

TAAP has a high-security vault that it uses to safeguard its

and in 2020 to achieve the ISO certification. This would

clients’ information; this technical area is fully isolated and

increase trust among clients and bolster our strength in

entrance is only permitted by fingerprint scan. Moreover, all

the market.

our certifiers are forbidden to access any type of technology and their computers lack USB ports and Wi-Fi connection.

More companies have reached out to us to seek advice on how to make the best out of the current uncertainty. TAAP is helping companies to navigate the procedures

Tercero Autorizado Como Auxiliar en el Control Sanitario de

with COFEPRIS and the industry. The biggest opportunity

la Publicidad (TAAP) is an authorized third party focused on

for TAAP are those pharmaceutical companies whose

sanitary advertising. The company offers services to the health

regulatory departments would normally collaborate

and beauty sector and food and beverages, among others

with COFEPRIS.

ROUNDTABLE | 2018 was a year of change in Mexico due to federal and state elections. A new government is implementing changes at all levels as newly appointed representatives take charge to achieve their objectives in healthcare. During this period, national and international companies will require a solid understanding of the regulatory environment, which only legislative experts can provide. Mexico Health Review spoke with lawyers, legal experts and consultants on the coming changes in the regulatory landscape and what companies must do to adapt to them.

WHAT ARE THE MAIN CHANGES YOU EXPECT IN THE REGULATORY FRAMEWORK?

Several factors impact the local healthcare environment. Changes have been made to public tenders of pharmaceuticals, imposing new requirements that do not encompass the health and the pharmaceutical industry systems in Mexico. For instance, the Mexican government now forces participants to have marketing authorization, which means only the manufacturer and not the licensee or distributor

269

may participate in the public tender. Most manufacturing companies do not have the infrastructure to participate in the tenders themselves, causing shortages and uncertainty in tender processes. There is also a fear that players from countries with no free trade agreement with Mexico will enter the bidding process with products

ALEJANDRO LUNA Partner litigation and Life Sciences Co-chair at Olivares

that may not fulfill regulatory standards. The public and private sector must work together for tenders to run smoothly and to ensure universal coverage.

Companies must be fully aware of the regulatory and economic changes in Mexico brought by the new administration and the new USMCA so they can react accordingly. This is a challenging time but also one of many opportunities for businesses. USMCA will extend copyright protection for biotechnological medications, which will impact biosimilars. Considering Mexico’s economy and its small budget for healthcare, these changes in patent law might have an impact on the health sector’s budget. The president is already developing a strategy to negotiate and pay for medicines. Hogan Lovells can capitalize on its experience to support clients as business models become increasingly complex, but also in the launching of innovative medications, M&A,

ERNESTO ALGABA Partner of the Life and Sciences Practice at Hogan Lovells BSTL

compliance and foreign trade.

The country’s epidemiological transition allows us to know which diseases are more prevalent and those that are increasing in incidence. This will continue to be an important factor in the state of public health, together with the need for the industry to contribute with more products and services. Although it is unfortunate that there is prevalence of such complex diseases in Mexico, this opens the door for the pharmaceutical sector to develop increasingly innovative therapies that improve people’s quality of life. We see an opportunity to improve hospitals and clinics that already have a staff, equipment and facilities of the highest quality. Opportunities will arise as different sectors generate incentives to attract investment. KPMG sees the greatest growth potential in the hospital sector, especially with the boom in medical tourism.

FAUSTO AVILA Audit Partner Specialist in the Health Sector at KPMG in Mexico

Hospitaria Hospital, Monterrey, Nuevo Leon

FINANCIAL & SUPPORT SERVICES

Increasing access to care remains one of the biggest challenges for the Mexican healthcare sector. Millions of individuals still have no access to the national health system and many face long wait periods and long distances to travel to reach the nearest clinic. Mexicans must also contend with a several-year delay between the launch of an innovative product and its arrival to the local market. Insurance companies and other financial entities see a burgeoning opportunity to make inroads in a country that traditionally spurns coverage. These players are also embracing their role in protecting those who have fallen through the cracks of healthcare coverage.

Financial & Support Services analyzes strategies to increase access to care through insurance and other financial methods. It will focus on how companies and their leaders are speeding up access to care by financially supporting the development and growth of healthcare companies and, with it, providing more people with access to healthcare.

271

CHAPTER 13: FINANCIAL & SUPPORT SERVICES

274

ANALYSIS: Public-private Alliances Increase Access to Healthcare

276

VIEW FROM THE TOP: Eduardo Lara, Reinsurance Group of America

277

VIEW FROM THE TOP: Luk Vanderstede, Bupa Global Latin America

278

VIEW FROM THE TOP: Juan Pablo González, Plan Seguro

279

VIEW FROM THE TOP: Pedro Pacheco, Prevem Seguros

280

VIEW FROM THE TOP: Paulino Decanini, SiSNova

281

VIEW FROM THE TOP: Steven López, Pacific Prime

282

VIEW FROM THE TOP: Raúl Jacobo, CHG-Meridian México

283

INSIGHT: Fernando de Obeso, Salud Fácil

284

VIEW FROM THE TOP: César Valle, IDOM

285

VIEW FROM THE TOP: Roy Bateman, Trifermed

286

VIEW FROM THE TOP: Liliana Mora, Síoltalife

287

VIEW FROM THE TOP: Leonardo Alves, Plan Wealth Management

289

VIEW FROM THE TOP: Ximena Hernández, Novostrategia

273

| ANALYSIS

PUBLIC-PRIVATE ALLIANCES INCREASE ACCESS TO HEALTHCARE The growing rate of chronic diseases affecting Mexicans will increase healthcare costs both for patients and the healthcare system. Under these circumstances, innovative cooperation strategies between the public and private sectors can be key to guarantee access to healthcare services Mexico holds the dubious honor of having the second-lowest

This problem will only worsen as Mexico’s population ages

investment in healthcare as a percentage of its GDP among

due to the growth of chronic diseases. The current overweight

OECD countries. The country spent just 5.5 percent of its GDP

and obesity epidemic, for example, affects 72 percent of the

in 2018 on healthcare, combining the efforts of both public

population and individuals are beginning to gain weight

and private healthcare institutions, according to the OECD.

earlier. Today, IMCO says one out of every three Mexican

This percentage has remained unchanged since 2016 and is

children and teenagers is overweight. Obesity is linked to

the lowest investment for the entire decade, even though the

several chronic diseases including diabetes, cardiovascular

population and its health problems continue to increase.

diseases and several types of cancer. Altogether, these three diseases were responsible for almost half of the annual deaths in Mexico in 2017. As a chronic disease is a lifelong issue, it

has steadily increased since 2010. That year, every Mexican

places a huge burden on the patients’ pocketbook, their family

was estimated to spend MX$6,988 in healthcare according to

and the healthcare sector. In 2017, treating obesity-related

the OECD. By 2018, that number had increased to MX$10,410,

diseases cost MX$240 billion (US$12.43 billion) and this figure

led mainly by out-of-pocket costs, which are also the second-

is expected to increase to MX$273 billion (US$14.14 billion) by

highest out of all OECD members. The reason is that about

2023, according to the Ministry of Health.

68 million Mexicans do not have social security, which leaves them unable to access public healthcare services and forces

The country is also facing a population shift. Modern medicine

them to head to private institutions and pay out of pocket. In

has reduced infant mortality rates and deaths from infectious

2018, the Mexican Association of Insurance Institutions (AMIS)

diseases, allowing individuals to live longer. In 1970, only 5.6

explained that 52 percent of health expenditure is made by

percent of the population surpassed 60 years of age. In 2017,

the public sector and the rest is paid out of pocket and by

this number nearly doubled to 10.5 percent. This complicates

private insurance.

finances for the healthcare sector because healthcare expenses increase sharply with age. In its Focus on Health

“The worst way to finance healthcare is out of pocket because

Spending report, the OECD explained that healthcare costs

this only makes healthcare services more expensive,” says

increase steadily as an individual ages but rise sharply after

Eduardo Lara, Head of Health, Latin America at Reinsurance

55 years of age. The organization states that those between

Group of America. A low investment in public healthcare has

65 to 69 years of age can represent from 10 to 16 percent

led to long wait times for medical attention and medication

of all healthcare costs, while those over 85 years old can

shortages at public hospitals. This, in turn, has led many to

represent from 15 to 67 percent of these costs depending

turn to private alternatives to finance healthcare services and

on the country.

medications. As a result, a growing number of seniors might impact the

GRAPH TITLE PER CAPITA EXPENDITURE ON HEALTH (MX$ thousand) 10 9.05

8.86

8.21

8.19

7.91

7.23

8 6

retirement systems are collapsing. In Japan, the system almost and the government does not have the money to take care of them,” says Leonardo Alves, CEO of Plan Wealth Management. While the private healthcare sector may help, only 4 percent of those over 60 years of age have a major health expenses policy, according to AMIS.

PRIVATE ALTERNATIVES

2 0

finances of an entire economy. “In developed countries, collapsed last year. There are simply too many elderly people

6.98

274

Conversely, the country’s per capita expenditure on healthcare

To fill gaps in public healthcare services many individuals are turning to the private sector. However, most of those 2010

Source: OECD

2011

2012

2013

2014

2015

2016

who do so prefer to pay out of pocket for every procedure

and very few invest in an insurance policy because they

MAIN CAUSES OF DEATH IN MEXICO (2017)

consider it to be too expensive. “Private health insurance is too expensive for most Mexicans, so these products often target medium and high-economic population segments: A, B and C+,” says Lara. While the value of the healthcare insurance market increased by 63 percent between 2000 and 2017, the growth in coverage is significantly smaller at 34 percent,

Cause

Total

Percentage

Heart disease

141,619

20.1

Diabetes

106,525

15.2

Malignant tumor

84,142

12.0

Liver disease

38,833

5.5

Accident

36,215

5.2

Cerebrovascular disease

35,248

5.0

according to AMIS. “Insurance penetration in Mexico is

Homicide

32,079

4.6

below 7 percent due to the lack of flexibility of the current

Chronic lung disease

22,954

3.3

product offering,” says Paulino Decanini, Executive President

Influenza and pneumonia

21,892

3.1

of SiSNova. In 2017, there were only 8.62 million people with

Renal insufficiency

13,167

1.9

health insurance, according to AMIS. Of those, 6.04 million

Source: INEGI

had an individual policy and the rest had a collective policy from work or family.

INSURTECH A growing trend that is slowly penetrating local

The problem holding private insurance back may be an

insurance companies is InsurTech, defined as the use

incorrect approach to the Mexican market. “We believe

of technological tools to increase efficiency and reduce

there are serious problems with the business model of many

costs of insurance operations. An increasing number of

insurers, which offer complex products that do not properly

developers are beginning to turn to the development of

address the underlying morbidity of the insured population,”

these solutions. For instance, Willis Towers Watson says

says Decanini. In Mexico, 44.5 percent of healthcare costs are

the field had received US$1.41 billion in investment just in

paid out of pocket and only 3.5 percent are paid by private

the second quarter of 2019, a 273 percent increase over

insurance, according to AMIS, which points to a significant

the same quarter in 2018.

percentage of the population that can and needs to pay for healthcare but has not found a product that addresses their

InsurTech allows companies to use data analytics, artificial

needs. “Many companies have shown interest in targeting

intelligence, blockchain and machine learning to reduce

the C and C- segments but they have not developed specific

risks for both policyholders and insurers. Moreover,

solutions that meet the needs and budgets of such segments

InsurTech platforms can be used to transform customer

yet,” says Lara.

engagement and eventually increase patient retention. These technologies can also be complemented through

Mexico has two types of healthcare insurance: major medical

the use of wearables and mobile health apps to collect

expenses and healthcare service coverage. “The former

critical data that can help a patient identify a disease

is associated with accidents and severe diseases whereas

or make lifestyle changes. This information can also be

health plans also include preventive healthcare,” says Juan

analyzed by insurers to create specialized products that

Pablo González, CFO of Plan Seguro. Healthcare coverage is

better address the needs of specific patient populations.

comprised of 97.4 percent major medical expenses and 2.6 percent of healthcare service coverage, according to AMIS.

While the benefits are many, Mexican insurers have been

Since the insurance penetration rate has kept steady for the

slow to adopt InsurTech practices. “Even though the

past few years, some insurers have developed alternatives that

Mexican insurance industry has been very traditional

sacrifice the number of covered diseases to reduce costs. For

and cautious to adopt changes, now it is understanding

instance, several insurers, including Mapfre, Prevem Seguros,

that digitalization could be a fast way to improve the

Sura and Inbursa Seguros, have introduced insurance policies

relationship with the end consumer,” says Lara.

exclusively for cancer. As Mexico’s population increases in number, age and Others call for a restructuring of the insurance sector. “The

weight, existing gaps in the healthcare systems will

key to effective health insurance is not just paying the

only grow wider. For that reason, innovative strategies

medical expenses covered but to make this sustainable, while

implemented by both the public and private sectors

managing the type and quality of treatments received by the

to finance healthcare services will be necessary to

patient, as well as their cost. To perform all these activities,

continue providing efficient access to services and

insurers require better health management services, provider

medication. “No sector can do this alone; alliances are

network infrastructure, cost-management processes and

vital for complementing and supporting each other,” says

specialized IT systems,” says Decanini.

Decanini.

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| VIEW FROM THE TOP

HEALTHCARE EXPERIENCE TRANSLATES TO BETTER INSURANCE MODELS EDUARDO LARA Head of Health, Latin America at Reinsurance Group of America

276

Q: How can Reinsurance Group of America (RGA) collaborate

Q: How can insurance companies better address the

with the public sector to innovate Mexicoâ&#x20AC;&#x2122;s healthcare system?

needs of the Mexican population?

A: Private health insurance companies should adapt to the

A: We believe there are serious problems with the business

local healthcare system in every single country. Those with

model of many insurers, which offer complex products

a strong public offering, such as the UK or Canada, do not

that do not properly address the underlying morbidity

require private health insurance products, because their

of the insured population. In addition, companies face

public healthcare systems are comprehensive, so insurers

complications in balancing complex regulation, financing,

must only fill certain gaps, such as coverage for medicines

service provision and product integration, the latter

or dental and optometry services that are not included in the

referring to how companies bring together financing and

public catalog. RGA wants to improve Mexicoâ&#x20AC;&#x2122;s healthcare

delivery of healthcare services.

system by introducing affordable products for the middle and middle-low income classes. Since total expenditure in

In Mexico, insurers act mainly as financers and do not

healthcare accounts for 6.5 percent of national GDP and

have the accurate focus to reflect that. Financers are

49 percent of that comes from private expenditure and

supposed to provide the financial resources to pay for a

considering that 92 percent of such private healthcare

medical covered incident. However, the key to effective

spending is out-of-pocket, this means that 2.93 percent of

health insurance is not just paying the medical expenses

Mexicoâ&#x20AC;&#x2122;s GDP is linked to out-of-pocket healthcare expenses.

covered but to make this sustainable, while managing the

Therefore, we need to create affordable and comprehensive

type and quality of treatments received by the patient, as

health insurance products. The worst way to finance

well as their cost. To perform all these activities, insurers

healthcare is out-of-pocket, as this only makes healthcare

require better health management services, provider

services more expensive.

network infrastructure, cost-management processes and specialized IT systems.

Although reinsurance companies do not work directly with the final user, RGA has developed strategies to

Q: How can insurers increase their profitability in the

go beyond the common reinsurer practice and ensure

healthcare sector?

companies are providing the products needed by the

A: Hospital bills for insured patients tend to be higher

market. Only 8 percent of the private health expenditure

than those for the uninsured, even after having the same

in Mexico is paid by insurers, since most Mexicans prefer

medical procedure. Uninsured patients always ask for an

to visit pharmacy-sponsored doctors or wait as long as

itemized bill and address with the physician and/or the

necessary to receive an appointment at public systems

hospital any irregularities related to items that were not

before paying for private insurance, which is why we

used or requested. Moreover, these clients can negotiate

are betting on specialized and affordable products that

a discount with the doctor or the hospital. Insurers, on

target specific ailments. We do not believe that a single

the other hand, are not negotiating with providers in the

company has all the answers but we can use our global

right way and incentives between financers and providers

experience to replicate successful implementations from

are not aligned, so bills remain higher, which is reflected

other markets, such as South Africa and Southeast Asia.

in larger premiums. The lack of true partnerships and mutual understanding

Reinsurance Group of America is the only global reinsurance

between financers and healthcare providers may also lead

company with a predominant focus on life and health

to abuse, waste and fraud in the use of medical services.

reinsurance solutions. It has offices in the US, Mexico, Brazil,

In the US, these three elements represent approximately

the Middle East, North and South Africa, China and Italy

30 percent of the total cost of an insurance premium.

VIEW FROM THE TOP |

INSURANCE AS INVESTMENT NOT EXPENSE LUK VANDERSTEDE Director General Mexico of Bupa Global Latin America

Q: Besides Blue Cross Blue Shield Association (BCBSA),

company, the idea is to have a controlled accident rate.

what other alliances have helped secure your foothold in

Clients who use their policy have firsthand experience of

the Mexican insurance segment?

our customer service, which also makes retention easier. The

A: Bupa formed a partnership with BCBSA resulting in a

challenge is with those clients who have not suffered any

joint venture named Highway to Health. The project allows

eventuality. We need to be in constant communication with

BCBSA’s clients to access medical insurance coverage across

these clients to retain them, conveying the message that

the world, while Bupa Global clients get medical coverage in

we help them achieve longer, happier and healthier lives.

the US. This is good news for our Mexican clients since most of international accidents involving Mexicans happen in the US.

Through Círculo de Bienestar Bupa (CBB), we help our clients and distributors to have a healthy lifestyle and we

Our local team for health and benefits has developed many

also participate in health-related events across the region,

other productive alliances, particularly with hospitals. We

such as the recent PGA Tour Latinoamérica golf tournament

are working hard to differentiate and increase our offering.

Bupa Match Play in Cancun and our Uber campaign in

We have solid partnerships with Grupo Ángeles and ABC

Mexico “Bienestar en el Camino.”

but we want our clients to have more options because more options lead to more variety inside and outside the country.

We also work to update our policies, focusing on topics

An example is our alliance with American Express. The profile

such as mental health. For instance, Bupa Global UK is

of many American Express clients, their lifestyle and needs fit

including certain conditions related to burnout in some

well with our offering. Another alliance is with Actinver, which

of its policies and the idea is to gradually bring this to

for the past three years has been an important intermediate

Mexico. Today, our coverage includes certain therapies for

channel to grow our client base.

Alzheimer and Down Syndrome but we want our clients to know that our policies are enriched by topics that touch

Q: How is Bupa using technology to improve its services?

upon productivity, such as mental health.

A: In Mexico, we need to work on digitalization but we have to analyze the regulation that allows us to do that. There are

Products offered by Bupa Global are investments, rather

many things that could be done, but when trying to apply

than expenses. However, in Mexico insurance is still seen

them to specific situations and following local regulations,

as an expense. It is important to see our products as

they cannot be implemented smoothly. An example is the

investments in the sense that clients can have access to

figure of the intermediator. Around 10 years ago, people

a network of more than 1.2 million healthcare providers,

used to say that insurance agents were bound to disappear.

even in the US.

However, I believe intermediators will always exist because at the moment of acquiring an insurance policy, people need

Q: What are Bupa Global’s main goals for Mexico in 2019?

assessment regarding the investment they are making. Also,

A: We are striving for healthy growth. We do not target the

the Latin American culture likes the human element, which

mass market, which is why our long-term goal is to be the

makes an intermediary necessary. Moreover, technology

most admired company in the premium medical expenses

has yet to develop the proper capabilities to evaluate the

segment in the next few years.

conditions under which an insurance policy should be drafted. Q: How is Bupa Global improving customer engagement and

Bupa Global Latin America provides international health

client retention?

insurance (IPMI), local health insurance (PMI) and travel insurance

A: If clients are happy, feel safe and know that their investment

for individuals and corporate customers as part of Bupa, a

is guaranteed, then retention is easy. For any insurance

prominent company with activities in different healthcare areas

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| VIEW FROM THE TOP

PREVENTION: BASIS OF GOOD HEALTHCARE JUAN PABLO GONZÁLEZ CFO of Plan Seguro

Q: How does Plan Seguro differentiate from other companies

benefit from technological innovations through increased

offering similar insurance services?

efficiency by trimming costs and ultimately lowering product

A: Since we do not have any other verticals, we need to be

prices. Today, we have an insured base of 130,000 clients and

self-sufficient in healthcare. Over the past 22 years we have

cover almost the entire country through a network of more

been meticulous in our operations, which has led to a more

than 4,000 doctors and 500 hospitals.

efficient operation with fewer errors. At the same time, rather

278

than focusing on price, we bet on higher quality products and

Q: How would you envision a public-private partnership

services. In the Mexican market there is a distinction between

to improve the insurance sector in Mexico?

major medical expenses and what is more broadly classified as

A: In other successful international models, such as

health insurance. The former is associated with accidents and

the Netherlands’, this partnership was designed by the

severe diseases whereas health plans also include preventive

government and the private sector working together. The

healthcare. Companies authorized to offer this wider range of

former pushed for strong social incentives but it had to

health products and services need to be certified as Insurance

find an economically viable model regulated by clear rules.

Institutions Specialized in Healthcare (ISES); Plan Seguro was

What the Netherlands’ government did was assign 100

the first company in Mexico to receive this distinction.

percent of the healthcare insurance to the private sector and forced every citizen to acquire a basic health insurance

Q: How can combining traditional and preventive insurance

package. Citizens can then choose to contract additional

models alleviate Mexico’s disease burden?

coverage. Another successful case is Chile, where citizens

A: Our approach has a long-term impact on the health of

have the choice to have a private plan or a government

the population. However, if people do not consider their

plan. In this case, the government invited private hospitals

health as part of their life plan, it will be difficult to effect real

and health providers to collaborate in public-offered plans.

change in terms of promoting preventive insurance models,

The problem we have in Mexico is that there is no such

especially considering that only 25 percent of the population

cooperation between the government and the industry.

has insurance coverage. Part of our strategy is to make people think about their future.

Q: What is the best way to prevent further rises in the price of insurance policies and boost penetration in the

Q: What role will digitalization play in providing better

Mexican market?

healthcare?

A: Insurers must ensure clients do not end up paying

A: Traditional insurance products are too complex and tend

for inefficiencies or errors in the operation of the policy.

to be mediated through a broker and a specialist insurance

However, the health of the population is the main factor

agent. We think this model is going to continue for the time

that determines the price of healthcare in Mexico. Chronic

being. Making a product more accessible through an app

diseases like diabetes, heart diseases and orthopedic

would require simpler and more automatic processes. There

conditions have now become the main cause for

is definitely a demand to adapt and become more flexible, but

expenditure among insurers and costs for such treatments

there are people who may not necessarily have access to the

have seen steep increases in Mexico. To reduce the impact

technology required to use such a tool. For now, we mostly

of health trends on insurance prices, it is important to develop flexible products and services. Portfolios should be able to adapt to target groups with different health

Plan Seguro is an insurance company specialized in health

risks, they should be managed easily and adapt to changing

plans. It has over 20 years of experience and a network of more

circumstances. However, we must also exercise caution

than 4,000 doctors, 500 hospitals, 65 medical coordinators,

to avoid reaching the point where there is not sufficient

more than 4,000 service providers and 21 commercial offices

coverage for the client.

VIEW FROM THE TOP |

COMPREHENSIVE APPROACH TO INSURANCE THROUGH CAREFUL ASSESSMENT PEDRO PACHECO Director General of Prevem Seguros

Q: How does the company differentiate from other insurers

whether companies have the financial capabilities to cover

focusing on major medical expenses and personal accidents?

their claims. However, there have been few promotional

A: We are part of Grupo Valore, a group of four insurance

efforts from the authorities regarding the benefits of

companies that specialize in different market niches: GMX

Solvencia II. The market needs to raise awareness about

specializes in property and liability, ANA in car insurance,

the costs of out-of-pocket healthcare expenses, especially

Argos in life insurance and Prevem Seguros in health

when dealing with catastrophic diseases such as cancer.

insurance. This strategy allows us to provide agile and comprehensive services for each situation and to generate

An area of opportunity for the government would be to

synergies to provide better services.

complement social security services with private insurance products. The government has to balance its budget and

Without a doubt, medical insurance is one of the most complex

provide care for its citizens. A growing problem is providing

products in the sector due to the many variables it considers.

care to seniors, who have higher healthcare expenses.

However, we are convinced that through appropriate risk

Collaboration between public and private care providers,

selection, we can benefit both our clients and investors. Up

for instance through the development and implementation

until the insured turns 50 years old, our policies are similar to

of specialized insurance policies, would greatly alleviate the

those of our competition. From that point on, all our insured

burden on the public sectorâ&#x20AC;&#x2122;s finances.

take an exhaustive medical exam that gives us significant information on how to better provide care for them. After this

Q: What will be the role of technology in Prevem Segurosâ&#x20AC;&#x2122;

test, we do not expect any surprises regarding future health

practices?

issues because we have a comprehensive medical profile.

A: InsurTech products are already part of the market and we

This generates transparency for us and for the insured and

must be ready to deal with these new initiatives. However,

helps the latter fully understand the policies and benefits they

medical insurance is extremely complex and acquiring

receive. We want to position ourselves as an honest company

a product requires the guidance of a professional. Fully

through appropriate risk selection.

understanding a medical insurance product is hard; we believe that at this stage, the public will continue to acquire

Our strategy has borne fruit and we now have about 6,000

these products from agents or brokers.

insured in our family plan and about 40,000 insured in group plans. Once they pass the initial filter, our insured usually do

Q: How can the industry address the lack of insurance agents

not switch insurance companies. We also have few complaints

to target the Mexican population?

with the National Commission for the Protection and Defense

A: The sector has strong career development potential. For

of Users of Financial Services (CONDUSEF). Our model relies

insurance agents, this is a business opportunity that does not

strongly on prevention, which is why every year we gift some

require a high initial investment. It is a well-paying position

selected clients with a basic checkup. The results are not

where the agent is solely responsible for their own income.

shared with us; they are for our insured to be aware of their

Moreover, this profession carries a strong social component

health. Our vision is to strengthen our insured base as we aim

because it requires providing care and preserving health.

to prove that this model allows for cost control.

Agents must be aware that these activities benefit families.

Q: What recommendations would you give the government to boost growth in the insurance sector?

Prevem Seguros is one of the four companies in Grupo

A: The Solvencia II policy implemented in 2009 led to

Valore. Prevem Seguros focuses on health insurance and has

significant changes in the insurance sector. The goal of this

over 40,000 clients in its group plans and 6,000 clients in

policy is to ensure users are protected and to inform them of

family plans

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INTEGRAL CARE STRATEGY LEADS TO TRIPLE-DIGIT GROWTH PAULINO DECANINI Executive President of SiSNova

Q: The insurance sector showed moderate growth in

implementation of early detection schemes and

2018. How did SiSNova perform in that same year?

prevention strategies. This integral service allows us

A: While the Mexican insurance sector grew at a 10

to participate in every stage of our clients’ life to help

percent pace in 2018, SiSNova grew at a triple-digit rate.

them stave off serious diseases. We have collaborative

We are now close to 237,000 insured individuals, 20

agreements with most hospitals, pharmacy chains and

percent of whom never had an insurance product before.

other suppliers of medications to ensure the quality of our services.

Our rapid development is thanks to the attention we place 280

on patient needs and our ability to respond quickly when

Q: What strategies is SiSNova implementing to promote

they need to use their coverage. We prioritize attention

a prevention culture among its insured population?

to our clients over any other administrative or financial

A: This is challenging because at this point, Mexico lacks a

concern. There are still challenges ahead but we expect to

prevention culture. We have been developing and testing

continue growing in the coming years above the market

several strategies to incentivize our insured population

rate. In 2019, our goal is to consolidate our position as an

to adopt a healthier lifestyle and undertake prevention

industry leader by developing functional strategies that

strategies. These vary widely between individuals

benefit the insured and to provide excellent services to

depending on their age, gender, socioeconomic status

ensure our patients and their families receive the best

and the commitment that clients and their employers have

medical care. Our main goal is to transform the Mexican

toward adopting these practices. There is no universal

healthcare industry.

strategy to convince individuals of the importance of adhering to these policies. We need to develop tailored

Q: What advantages does SiSNova offer when compared

strategies for each case.

to traditional insurance products? A: We offer a comprehensive solution that meets all the

Results of these prevention schemes ultimately depend

medical needs of the insured individual. Traditional major

on the individual, especially with problems of obesity,

medical insurance policies provide financial protection

sedentarism, tobacco use and alcoholism. It is necessary

to avoid the decapitalization of individuals and their

to increase awareness about the importance of looking

families after a disease or an accident. These policies

after one’s health. To do that, it is necessary to accompany

require individuals to pay a co-insurance and a deductible

the individual through their entire life.

every time the policy is used. Moreover, they only become active once the individual surpasses an established

Q: What role can technology play in establishing a

minimum payment, which often means that they only

prevention culture?

provide care for catastrophic diseases, leaving a gap in

A : Te c h n o l o g y i s a u s e f u l to o l b u t s u cce ss f u l

healthcare services for primary care.

implementation depends on how willing the patient is to use it. While new technologies can automatically monitor

SiSNova’s goal is to protect more than the individual’s

a patient’s health condition, they are worthless if patients

finances; we also care for their health through the

do not integrate them into their daily life. Insurance companies are increasingly incorporating technology into their monitoring practices but it is still not a priority for

SiSNova is a Mexican company that aims to change

clients. The patient’s main concern is for the insurance to

insurance in the country by providing policies and services

work when it needs to, which means our priority should

to individuals who do not have access to the private

also be to remain close to the individual and cover their

healthcare system

basic healthcare needs.

VIEW FROM THE TOP |

TECHNOLOGY, GLOBAL KNOWLEDGE KEY TO BETTER INSURANCE PENETRATION STEVEN LÓPEZ Head of Operations LATAM at Pacific Prime

Q: What makes Pacific Prime the ideal adviser for

Global, Allianz Worldwide Care, Cigna Global, Aetna,

companies in Mexico?

AXA, MSH and Ping’An. Unlike other players that get

A: Pacific Prime is an insurance adviser that offers local

more bureaucratic as they evolve from a midsize to an

insurance solutions and a wide range of health plans

international operation, our fast and efficient services

for individuals, families and enterprises all around the

allow us to work with the biggest companies around

world. In Mexico, the company specializes in major and

the world, together with our centralized operations to

minor medical expenses, although we cover other niches

provide better customer service.

like business and life insurance. While Pacific Prime has a global and scalable model, better than Asia, Mexico

Q: How can having a health plan translate to

offered the ideal platform to first cover the entire country

improvements in an international school plan for

and then expand into other countries in the region.

business development?

Mexico, Brazil and the US are our main market targets

A : I n te r n at i o n a l s c h o o l s wo r k d i f fe re n t l y t h a n

in the Americas but Mexico is going to be the central

companies. They have different holiday schemes and

subsidiary for Pacific Prime on the continent.

the characteristics of a professor as an employee are also very particular. Other insurers tend to generalize

Q: What differentiated benefits do you offer in Mexico

international schools and treat them as any other

compared to local brokers?

company with employees. In comparison, Pacific Prime

A: The main differentiator is that Pacific Prime has a

has a clear understanding of how schools work, their

global reach, while local brokers have a more limited

academic calendar, dynamics, holidays, budgets and

scope. Mexican brokers might know a lot about the

more. The greatest added value for any school that

market but normally they only have local reach and lack

wants to hire Pacific Prime’s services is that we know

the knowledge to operate outside the country. Pacific

how their business works and our solutions will contribute

Prime offers insurance to over 3,000 companies including

to enhancing their development.

many multinationals, SMEs and international schools, the latter being our main target and the main source of

Q: What makes Pacific Prime the best option for expats

our revenue.

in Mexico? A: Originally, Pacific Prime emerged as a solution for

Pacific Prime’s completely digital model and our global

expats who required insurance services, so the company

presence are what makes a difference for our clients.

has relevant expertise in offering comprehensive

Through its digital platform and specialized sales team,

international health policies to this segment in Mexico

the company is able to reach the medium and high

and anywhere else in the world. As economies grow

socioeconomic segments in Mexico. All our products are

stronger and global migration increases, there is a greater

designed to compete in the international market, which

demand for insurance companies to address international

is why the products are marketed to reach clients with a

needs. Pacific Prime will continue to be the best option

higher purchasing power. Mexico is among the countries

for those expats who need portable, flexible and tailor-

with the most expensive private treatment, which makes

made policies.

our offering highly attractive for the national population. Q: Besides Bupa Global, what other international and

Pacific Prime is a leading international employee benefits

national partners do you have in Mexico?

agency with more than 500,000 clients worldwide. The company

A: Pacific Prime has partnerships with over 40 companies

has offices in Hong Kong, Singapore, Shanghai, Beijing, Dubai,

around the world, the most representative being Bupa

Bangkok, London, Los Angeles and Mexico City

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UNDERSTAND THE CLIENT BEFORE PROPOSING SOLUTIONS RAÚL JACOBO Health Manager of CHG-Meridian México

Q: How does CHG-Meridian differentiate from other

This requires a lot of time and allows for less flexibility.

consulting firms in the sector?

In the health sector, we are clearly seeing an increasing

A: CHG-Meridian is a German company focused on

overlap between medical and technical teams. Doctors will

providing solutions in four areas: IT, car fleets, industry and

increasingly require technical knowledge of software. We

healthcare. In the latter, we help to create flexible models

know how this works and can offer solutions that support

so hospitals and other industry players have the best tools

this new dynamic.

to provide added value to their clients. Besides hospitals,

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our clients include pharmaceutical companies and clinical

Q: How do you think consulting services will evolve in the

laboratories. Our consulting solutions can focus on better

healthcare sector?

and faster service or new technology to make processes

A: There is a generalized lack of understanding of

more efficient and cost-effective.

healthcare players among consulting companies. There is greater need for teams that can better analyze a client’s

We provide flexible models so clients can free up their

context and more closely match the specific client profile.

resources for new investments. We also provide advice on

Normally, a client has to adapt to what a consultant can

where to allocate these resources. Our goal is to build long-

offer according to budget. We take the opposite approach.

term relationships with clients. We do not come in for one

We try to understand how the client operates, working on

project to walk away with a big sum of money. Our sustained

the assumption that most assets in a hospital should not be

commitments have allowed us to develop know-how in

consuming significant resources. With the latest technology

state-of-the-art technology. We are helping a hospital revise

and analytics, we can help to reduce our clients’ financial

its investment in a new project for oncological care. We are

burden and free up space for new investment.

structuring the investment scheme, determining what tools are necessary and designing the right teams to run the projects.

Consulting companies will increasingly focus on a specific niche and we are already doing that. We are experts in

Q: How does the company bring technology closer to

remodeling the dynamic between assets and costs. Our

its clients?

ultimate goal is to be top of mind for CEOs and CFOs

A: We use a digital platform called TESMA, which gives

when there is a need to revisit cost structures. Given this

clients access to a detailed overview of the equipment in

specialized vision, we are not entirely against working with

the project. The system can be accessed from anywhere and

other consultants to offer an integral service to clients.

provides insight into elements from both CHG-Meridian and the client. As a result, clients can see where their assets are

Q: What are CHG-Meridian’s main goals in healthcare

located geographically, where the costs are centralized and

for 2019?

how much the company pays on equipment and buildings,

A: We want to be an important player and point of reference

among other factors. This shines a light on finances and

in restructuring and asset financing. Our main target will

also allows a faster resolution of problems. The system

be hospitals, pharmaceuticals and private laboratories. To

also makes it easier to produce reports. In many cases, our

attract them, we will need to showcase the particular vision

clients previously created reports using Microsoft Excel.

we offer. In geographical terms, we are active in 25 countries. In the Americas we are present in Canada, the US, Mexico and Brazil and we work with companies with activities in

CHG-Meridian has 40 years of experience in consulting and

multiple countries. In Mexico, we are working with more local

leasing services for IT companies, industrial players, automotive

companies because there are not many international players.

companies and the healthcare sector. In the latter, the company

Regarding our own suppliers, we do not work through

offers solutions to efficiently manage investments

exclusivity. If there are two vendors, the client can choose.

INSIGHT |

LEASING AN OPTION TO MODERNIZE EQUIPMENT FERNANDO DE OBESO Director General of Salud Fácil

New technologies and advanced medical devices have

Given that Salud Fácil’s core is leasing and providing credits

improved diagnostics and increased treatment options

to patients, the company does not force clients to use a

but for small clinics and hospitals, modernization that

specific brand or model. “Usually, when the client gets to

offers a wider array of solutions for patients represents

us, they already know the brand and model they want and

an additional financial strain, says Fernando de Obeso,

have a notion of the price. Our job is to facilitate leasing and

Director General of Salud Fácil. “Most large hospital groups

we offer transparency throughout the entire process,” says

work in partnership with banking institutions and do not

de Obeso. As part of its commitment to provide access to

face challenges in obtaining financing for acquiring new

new technologies to hospitals, clinics and patients, Salud

diagnostic and treatment technologies. However, small

Fácil signed an alliance with Boston Scientific. “The main

hospitals and clinics have a hard time accessing these

purpose of this alliance is to find a way to make new and

funds,” he says.

innovative equipment accessible to patients. We are aware that there are new technologies that can be used to treat

Salud Fácil has taken on the task of providing leasing

diseases and that the public health system in the country

options for medical equipment so that small clinics now

is limited when offering support to companies, so the goal

have that option. “We believe that the biggest opportunity

of this alliance is to give smaller clinics and patients access

lies in small and medium-sized clinics and hospitals in the

to the latest technologies in an affordable way.”

country. Our bet is that through our leasing options, they will want to modernize their equipment and thus improve

The company started operating in 2013. It started offering

their quality and offer new services.”

leasing services three years ago and the area now represent 70 percent of its business activity. However, de

The Mexican company is dedicated to financing any type

Obeso believes growth opportunities in the short term will

of medical equipment to doctors and hospitals in addition

come from financing for patients rather than for medical

to offering financing to individuals for surgeries, treatment

equipment. “It appears that subrogated private services will

or other medical necessities. It has developed the needed

disappear, which means people will have to pay more for

expertise in the sector to position as a competitive

certain services at private hospitals. In these cases, credit

alternative to larger financial institutions, de Obeso says.

will be a good alternative.”

“Leasing operations are more complex than credit itself because they involve different risk variables. However, our

Should subrogated services in private hospitals disappear,

advantage is that we can offer personalized solutions to our

and considering that Mexico has around one-third of the

clients, which is something a banking institution cannot do.”

health infrastructure it needs, growth opportunities for Salud Fácil would multiply, according to de Obeso. The company

Backed by national and international investors, de Obeso

has an open scheme to work with all hospitals, providing the

says Salud Fácil offers competitive interest rates when

needed flexibility to meet patient requirements.

compared with other financing options. “Although all our international investors are investment funds, we also have

Although Salud Fácil is only physically present in Mexico

national private individuals who invest in our operations.”

City and Guadalajara, de Obeso says technology will

Salud Fácil has attracted such attention mainly because

increase coverage to the entire country for both patients

of the social impact the company has. “Many investment

and hospitals looking for leasing alternatives. He is confident

funds have a mandate to invest in projects with social

that even though the company does not have plans to open

impact. Moreover, they have to diversify their portfolio

new offices, it will continue experiencing significant growth.

and the health sector offers attractive opportunities in the

“We want to double our operations in the coming years in

country,” he says.

terms of leased equipment and patients.”

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SPANISH GIANT MAKES MEXICO ITS SPEARHEAD FOR HEALTHCARE DIVISION CÉSAR VALLE Director General of IDOM

Q: What is IDOM’s value proposition for the health sector?

Farmacias Benavides and Farmacias Guadalajara, all of

A: IDOM is a professional services company. Over

them with very specific logistics needs.

many years, we have built strong capabilities in hospital infrastructure, mainly in the design and project

Q: What is IDOM’s strategy to increase its penetration in

management of hospitals. As of 2018, IDOM had

the private healthcare sector?

participated in the construction of 80 clinics and hospitals

A: We have developed several strategies. The first is

around the world.

through our work with industry associations, such as Funsalud, the Business Coordinating Council, CANIFARMA,

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The company also has a manufacturing/logistics division

AMIIF and the Mexican Hospital Council (CMH). We are

that has worked closely with the pharmaceutical and

also participating in industry events and work very closely

medical devices segments. We also have an active

with universities, NGOs and other industry participants.

consultancy area, which has closely worked with public health departments, mainly in Spain, Mexico and Colombia.

Q: What logistics advantages do manufacturing

Considering our previous experience, we decided to

companies and pharmaceutical retailers get from allying

launch a division specialized in healthcare services, which

with IDOM?

combines our capabilities with a team of professionals with

A: IDOM supports two crucial operational aspects of

medical, biomedical and pharmaceutical backgrounds.

manufacturing companies: manufacturing and logistics. No company describes its logistics or manufacturing

Q: What main services will this division deliver to both

processes as perfect, so opportunities to work always

the public and private sectors?

arise. The interest of pharmaceutical retailers lies in

A: This division is operational and we are already

their warehouses, which often require automation and

developing projects alongside the Inter-American

optimization processes. There is little competition in this

Development Bank and Banobras. In the future, we

sector, since there are few Mexican companies with the

will work with both the public and private healthcare

capacity to offer integral services.

sectors. In the former, we will focus on the development of public policies and the incorporation of technology

Q: Which areas should the new federal government

and equipment. Our clients will be mostly public and

prioritize in terms of public policy and how does IDOM

governmental institutions, such as IMSS, ISSSTE and the

plan to support the administration?

Ministry of Health.

A: There are several recurrent topics in healthcare, such as providing universal access and more affordable

In the private sector, we will focus on pharmaceutical

medications to those who need them. I believe public

and medical devices, which will require management

policy should focus on the integration and optimization

consulting, logistics and manufacturing services. We also

of services, which would have an impact in the short-term.

plan to work with private hospital groups and insurers. Another interesting industry in Mexico is pharmaceutical

The sector needs to develop stronger planning strategies

retail, with pharmacy chains such as Farmacias del Ahorro,

for public infrastructure developments; several institutions develop their own infrastructure projects independently and these buildings often are underused due to poor

IDOM is an international consultancy with several divisions

planning. The construction of this type of infrastructure

specialized in energy, telecommunications, water, transport

requires a large investment but operation and maintenance

and cities. Its consulting arm manages logistics services,

are often left unfunded, making these hospitals or clinics

management systems, strategic consulting and supply chain

inoperative in a very short time.

VIEW FROM THE TOP |

LINKING NATIONAL, INTERNATIONAL SUPPLIERS FOR BUSINESS DEVELOPMENT ROY BATEMAN Honorary President at Trifermed

Q: How does Trifermed contribute to Mexicoâ&#x20AC;&#x2122;s

Q: What main barriers to access do foreign companies run

healthcare sector?

into when seeking to enter the Mexican market?

A: We have two business approaches: portfolio development

A: The most common barrier is getting products approved,

and partnership development. The portfolio business

and COFEPRIS is aware of this. COFEPRIS is a sophisticated

approach targets companies already established in one or

organization and has adapted its processes to the needs of

several markets that want to grow organically within that

the Mexican population. It is now considering accelerating the

region. We help them find products to incorporate into their

approval of generic products to increase access and keep up

portfolio after canvasing the companyâ&#x20AC;&#x2122;s existing product

with the innovative products the market needs.

offering to fully understand how the company operates. We then establish the companyâ&#x20AC;&#x2122;s product requirements and look

Mexico also has challenges that are not present in other parts

for international partners that can supply them.

of the world. In some parts of Europe and Canada, for instance, medical assistance is administered by the government and

In the partnership development model, a client, often a small

a significant number of available products are sold through

or midsized company, has an asset that it wants to export to

a reimbursement system that does not exist in Mexico. The

other parts of the world but it lacks the necessary financial

challenge is to explain to foreign companies how the Mexican

resources. For instance, we successfully helped a company

market works. When a company wants to bring a product to

in Holland that had a diabetes product it wanted to bring

market, it must consider not only prices, but also regulations.

into Mexico.

Some companies believe that understanding US or European regulations is enough to obtain an approval in the Mexican

Q: What are the main market opportunities for Trifermed

market but that is not the case.

in Mexico? A: We are seeing growth potential in several product areas,

Q: What are the specifics of your main services for the

including generics. Many companies, for example, are looking

Mexican market?

for more specialized generics for oncology. Other new areas

A: We work closely with those clients that want to enter the

include nucleic acid therapeutics, protein therapeutics,

Mexican market, validating their business model and helping

bioelectronics and wearables. Some Big Pharma companies

them understand how the market works. We do not provide

are already developing comprehensive solutions. For instance,

market research but we consult with local companies to see

companies with products for chronic degenerative diseases

which one might be a good match for our client. In this way

such as cancer combine them with diagnostic products to

we have helped foreign companies find partners in Mexico.

offer a comprehensive solution to the doctor and the patient. We also work with Mexican companies to help them move Another area that is attracting attention is the genetic

export their products. One example is Laboratorios Armstrong,

mapping of diseases. In the next few years, patients will

which we helped to export its product for head lice called

start receiving medicines according to their genetic profile.

Herklin to the US. In this case, we found a partner in California

Personalized medicine is still far away but it is important for

that specialized in importing Latin American products for the

companies to start thinking about it because it will play a

Hispanic population in the US.

fundamental role in the future. Rare diseases are another area of interest. Trifermed specializes in corporate and business development

The combination of research and genetic mapping can allow

for healthcare solutions. It has been involved in the market

doctors to better understand how rare diseases function in a

launch of 140 medical solutions. It works with pharma and

particular patient and even cure them.

biotech companies, academia and startups

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LOCAL COMPANY STRIVES TO PIONEER NEW TECHNOLOGIES LILIANA MORA Director of Síoltalife

Q: What is Síoltalife’s value proposition for the

Mexican pharmacopoeia required the use of pycnometers to

healthcare market?

measure density, which require much larger sample quantities,

A: Síoltalife aspires to become a link for those international

so we worked to introduce this technique into the local

institutions that want to establish themselves in Mexico

industry. It is now considered a reference technique.

through a personalized value proposition based on an end-

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user focus, expertise, knowledge, confidentiality and no

Q: How does Síoltalife adapt its strategies according to

competition. Síoltalife proposes a disruptive model through

its clients?

a multidisciplinary team with more than 15 years’ experience

A: Our team is comprised of experts in many areas; for

in the scientific market. Although we use standard marketing

instance, we have an internationally-certified coach, an

platforms, we always look for what differentiates a company

expert in validation with many years of experience in the

and generate the market strategy around that.

pharmaceutical industry and a group of chemists with significant experience in sales. Every project is evaluated

As we work in life sciences, we promote high-tech products

according to customer needs and goals to define the best

and we employ a strong technical team to ensure the final

strategy for development. We have been working with

user has the required technical knowledge. We work mainly in

a Chinese company that has developed a high-quality

the Mexican pharmaceutical industry but we have developed

packaging that is attractive to Mexico’s generics market

some lines for packaging technologies. We are business

thanks to its competitive cost. We take one of two approaches

developers and our goal is to help manufacturers to position

with new clients. The first is to work with indirect suppliers

their product in the Mexican market.

of critical materials, such as packaging for medications. The second is the direct approach: working with a pharmaceutical

Q: What Síoltalife products or technologies are most needed

company that requires the packaging and can import it. In the

by those companies looking to enter the Mexican market?

latter case, the challenge is logistical.

A: We have launched new technologies in Mexico, including digital measuring of concentration rates, bioreactors,

Q: How is Síoltalife supporting Mexican companies and

rheometers and X-ray diffraction. We want to generate

institutes?

connections with international manufacturers to help them

A: We collaborate with research centers and CROs, such as

adapt their global strategy to Mexico’s landscape. We also

Pharmometrica, a center that recognized the need to diversify

want to be strategic partners to these manufacturers and

its business to continue expanding. We are helping this CRO

support them by launching technology in the Mexican market.

to diversify its market and to build its branding strategy for

For instance, we worked with a German glass manufacturer

Latin America. We also developed a short-term strategy that

to launch Nexterium, a glass covered with several chemicals

includes customer-retention strategies for project and sales

that can be used to print genes.

tracking management and finally, we developed a loyalty program to retain customers and new clients.

Together with an Austrian company, we developed an oscillating U-tube that can be used to determine the density of

The Mexican market is seeing an influx of globalization leaders

liquids with fewer sample sizes than conventional techniques.

that require proper communication, people development and management skills to ensure profitability. This has led to another strategic line, which is our leadership development

Síoltalife is a Mexican consultant firm that specializes in

program, created after the company found itself with a

business development and marketing. Its capabilities include

large team of expert scientists and technicians who lacked

market analysis, design of market strategies based on public

leadership skills. This program generates value through

relations, project management and brand design

human capital.

VIEW FROM THE TOP |

FINANCING THE CLIENTâ&#x20AC;&#x2122;S FUTURE LEONARDO ALVES Director of Plan Wealth Management

Q: How is Plan Wealth Management addressing the

A: Our key alliance in Mexico would be GNP, along with

growing market for retirement insurance through its

several large private investment firms. However, we truly

products and services?

believe our clients are our No. 1 alliance. Listening to our

A: Basically, we have two markets in Mexico. One half are

clients and understanding their needs continues to let us

Mexicans and the other half are foreigners living in Mexico.

further develop our products to their full potential and to

As a company, we offer international savings solutions

deliver more than what clients could expect from us.

with global financial expertise. This area is doing very well because Mexico is a fast-growing economy and an

Q: Pension funds are struggling in many countries. How do

increasingly popular destination for business. For example,

you maintain healthy funds?

there are now five times more Europeans living in Mexico

A: In developed countries, retirement systems are collapsing.

in comparison with 10 years ago.

In Japan, the system almost collapsed in 2018. There are simply too many elderly people and the government does

The local market has also changed. Ten to 15 years

not have the money to take care of them. A similar thing

ago, people were not used to creating savings plans. In

happened in 2011 in Europe. We focus on keeping our

the past, the average Mexican family would have more

savings in funds with a healthy future. One of our favorite

children and the parents would depend on support from

funds is the pharmaceutical and health industry. We have

the children once they retired. Today, it is difficult for a

funds like UBS Health Funds, UBS Biotechnology and JP

professional couple in a city to look after themselves,

Morgan Healthcare. Many of these funds have been voted

they cannot afford to have a large number of children

for years as the best in terms of long-term security. They

anymore. They also know that life is going to be more

include companies like Sanofi, Bayer, Glaxco and Pfizer

difficult for their children, so they have to take more

and several more. The reason why they count as the best

responsibility for themselves. Many people, especially

is because this industry is going to keep innovating and

younger generations, are more prepared. They leave

producing. The world is going to keep on needing medicine,

university already more aware that they need to start

so it is a steady sector.

saving. That is why we provide advice, educating people about the importance of saving and the most efficient

Q: What role does digitalization play in your companyÂ´s

way in doing so.

operations and services? A: Technology has become more and more important in

Q: How do you reach your clients?

our work. We have to be up to date with all the different

A: Because people are becoming more aware that they

online platforms designed for this industry. Many people

need to start saving, they tend to come to us. Our clients

come looking for services via social platforms. In terms of

tend to be people who are serious about their financial

providing a digitalized product, the technology is there and

future and the well-being of their families. Our clients are

it is an available option for our clients. However, many clients

people looking for reliable saving and investment solutions

still prefer a meeting with one of our professional financial

with the highest standards of quality and efficiency from

planners who will personally assess their needs. We also

leading and well-known finance institutions. We have a

want to ensure we keep providing a personalized service.

professional team of planners who reach out to potential clients who would welcome our services. Plan

Wealth

Management is

independent

financial

Q: You have many alliances around the world, with over

consultancy with over 20 years of experience. The company

300 funds and 22 partners. Which would be your key

is headquartered in the UK, but operates in 21 Latin American

alliance in Mexico?

countries, including Mexico, Brazil, Colombia, Chile and Peru

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3M innovation center, Cuajimalpa, Mexico City

VIEW FROM THE TOP |

DATA SOLUTIONS HUMANIZE HEALTHCARE XIMENA HERNĂ NDEZ Director General of Novostrategia

Q: What opportunities did Novostrategia identify when it

Our solutions can be implemented by hospitals to improve

decided to focus on patient safety?

their practices and by civil organizations focused on certain

A: Novostrategia began as a consulting firm focused

diseases to help hospitals provide better care. In hospital

on helping hospitals acquire national and international

administration, we want to increase process efficiency

certifications. We found areas of opportunity and many

through measurement and identification of problems using

barriers in the certification process, which was seen by most

technology. Addressing overlooked issues related to hospital

directors as just another box to tick instead of the basis for

administration can improve quality and efficiency and also

quality. We also noticed a general lack of awareness among

translate into savings. Gaps in services represent wasted

doctors, hospital administrators, patients and their families

resources that could be better spent in further innovation.

regarding patient safety and the areas this covers. Q: What strategies is Novostrategia developing to increase Our solutions are based on strategic links between companies

awareness of patient safety across the healthcare sector?

in the healthcare sector to promote information exchange,

A: During 2019, we will focus on conducting workshops

which allows us to generate innovative ideas that prioritize

that address multiple areas related to patient safety and

patient safety. Patient safety is like a carâ&#x20AC;&#x2122;s seatbelt; its use is

patient experience. Eventually, these will be incorporated

both the responsibility of the vehicle manufacturer and the

into an online platform to achieve multidisciplinary

end user. We decided to bring together insurers, hospitals,

education that is accessible to all. We are also creating

pharmacies and other players in the healthcare sector

partnerships with software developers and quality

to gather data on patient safety. We are also investing in

certifiers to continue raising awareness about patient

innovation of healthcare systems through technology that

safety and encouraging more companies to work

humanizes patient care. Most technologies in the health sector

with us. We have established partnerships with the

are focused on diseases but improving processes is just as

International Society for Quality in Health Care (ISQua),

important.

with other initiatives of technological innovation and with The Patient Safety Company, which developed a risk

Q: Some players in the healthcare sector are already compiling

notification system for hospitals. We hope to build more

data on patient safety. What gives Novostrategia an edge?

partnerships with software developers, pharmaceutical

A: A lack of publicly available information means users cannot

companies, distributors, medical societies and schools.

compare hospitals and choose the one that is best suited to address their specific needs. While some hospitals, laboratories

Throughout the year, we hope to become the first company

and pharmacies compile this information, they keep it private

in Mexico to work in people-centered care, linking patient

so it is not possible to use it to generate comprehensive public

safety and experience in developing projects at the local

policies. Data is key to developing strategies that improve

level. Our second objective is to position ourselves in Latin

patient safety in hospitals and generate campaigns that

America to produce a virtual event that brings together

increase awareness among the general public. Some players

all companies in the region that focus on patient safety,

already have access to this information but have failed to use

attention focused on people and the humanization of care,

it for the benefit of the patient.

no matter how small they are.

Q: What main benefits does Novostrategia introduce to the healthcare sector?

Novostrategia is a strategic innovation agency that seeks to

A: Technology allows hospitals to promote a quality-centered

humanize healthcare through data science, innovation and social

culture that, to be effective, must be adopted by the top

change. The company focuses on creating a patient-centric

leadership and then trickled down to the entire workforce.

culture and influencing public policy regarding patient safety

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Oracle's VRAR system

290

LOOKING AHEAD

Healthcare providers and other industry participants have been witnesses to the changes in the population pyramid and the country’s epidemiological transition. With these changes, new challenges and opportunities appear in the sector. National and international companies seek to make the best of these opportunities through years of experience working in the health sector. However, new players, including startups and SMEs, are also becoming valuable players in driving the future of the sector.

Mexico Health Review 2019’s final chapter analyzes the trends that could alter the healthcare environment in the years to come, through interviews with those who are making waves, be it through a new product, service, technology or agreement. Moreover, it also includes key players such as venture capital firms and foundations in charge of looking for ways to invest in Mexico’s health industry transformation.

291

292

CHAPTER 14: LOOKING AHEAD

294

ANALYSIS: Entrepreneurship, Innovation Turn Needs Into Business Opportunities

296

VIEW FROM THE TOP: Juan Manuel Contreras, Ámbar Capital

297

VIEW FROM THE TOP: Arturo Bañuelos, Balero

298

VIEW FROM THE TOP: Lourens Verweij, Additio Investment Group & Industry Advisor

299

INSIGHT: Germán Montoya, Rokk3r Labs

300

VIEW FROM THE TOP: José Luis Elizondo, Wellmedic Health Centers

301

VIEW FROM THE TOP: Rodrigo Padilla, Happinss

301

VIEW FROM THE TOP: Adriana Vallejo, Hacking Health

302

VIEW FROM THE TOP: Andrea Campos, Yana

303

VIEW FROM THE TOP: Javier Barragán, Avena México

305

VIEW FROM THE TOP: Josep Tomas, Miyabi Labs

306

VIEW FROM THE TOP: Luis Lojero, Mural Med

307

VIEW FROM THE TOP: David Potes, Apolo Health

307

VIEW FROM THE TOP: Tomás Iglesias, OMI

308

VIEW FROM THE TOP: Lorena Tirado, Alternativa Médica Integral

309

VIEW FROM THE TOP: Everardo Barojas, Prescrypto

310

VIEW FROM THE TOP: Katty Beltrán, Fundación Dibujando un Mañana

311

VIEW FROM THE TOP: Roberto Tapia-Conyer, Fundación Carlos Slim

312

VIEW FROM THE TOP: Paloma Vázquez, Bioskinco

Patricia Reyes, Bioskinco

313

VIEW FROM THE TOP: Victor Saadia, BioCenter

314

VIEW FROM THE TOP: Gilberto Medina, Novogen, Part of IVG Group

315

VIEW FROM THE TOP: Jorge Moran, Genetics and Health

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| ANALYSIS

ENTREPRENEURSHIP, INNOVATION TURN NEEDS INTO BUSINESS OPPORTUNITIES The future of healthcare in Mexico could rest on two key planks: entrepreneurial know-how that can convert uncertain conditions into business opportunities and innovation itself, which is already transforming the industry, from the digitalization of clinical records to the creation of applications to support treatments This is how the WHO defines innovation in healthcare: a

A report from the nonprofit organization Innovations in

response to unmet public health needs by creating new of

Healthcare constituted by Duke Global Health Institute,

ways of thinking and working that focus on the needs of the

McKinsey & Company and the World Economic Forum,

most vulnerable populations. In Mexico, the healthcare industry

identified Mexico, along with other countries in Latin

is ripe for innovation and the coming years are expected to

America, such as Brazil and Colombia, as destinations that

attract growing interest from multiple stakeholders that could

are emerging clusters of health innovation, which can be

radically transform the industry.

preventive, promotional, curative, rehabilitative or assistive. Emerging companies in Latin America have raised between US$500,000 and US$100 million in the last 10 years, which

research, new medicines and Big Pharma, innovators and

also resulted in more than 25,000 full-time jobs in the region,

entrepreneurs are emerging to address one of Mexico’s

according to LAVCA’s Inaugural Survey of Latin American

biggest health issue: access. The government is touting a

Startups. The region has attracted the attention of players like

universal health policy but with budget cuts and austerity

Softbank, which initiated its US$5 billion Tech Fund for Latin

measures, it could be hard-pressed to deliver. Entrepreneurs

America in 2018. This year, GINGroup also announced US$5

and emerging technologies are rising up, providing solutions

million fund to boost Mexican startups in areas like education,

that expand access to care and medicines, while many

health and finance. The health innovation ecosystem includes

traditional institutions remain unprepared.

a diversity of players. From digital platforms like OMI, Apolo Health, Prescrypto and Mural Med that support the digital

“Traditionally, healthcare is about a consult between a doctor

management of clinical and administrative procedures for

and a patient. However, more and more businesses are

health provisioners, to chatbot applications like Yana that

springing up that offer health services in alternative ways,”

support the treatment of people with depression, innovators

says David Potes, CEO and Co-founder of Apolo Health.

look for ways to transcend the way health products and

“Treatments can also be provided outside the hospital through

services are provided.

new innovations and better communication platforms.” Potes adds that many health institutions are lagging behind. “A

Opportunities exist across the spectrum of services, says Juan

transformation similar to what visual media encountered with

Manuel Contreras, CEO of Ámbar Capital, a private equity

Netflix is coming to healthcare and many institutions are not

firm specialized in technology and healthcare. “After several

prepared,” he says.

years with an extensive presence in healthcare services,

ENVIRONMENT FOR ENTREPRENEURSHIP ACTIVITY BASED ON THE NECI INDEX (out of 10 points) 8 7 6 5 4 3 2

Source: Global Entrepreneurship Monitor

Lebanon

Latvia

Kazakhstan

Japan

Italy

Israel

Ireland

Iran

Indonesia

India

Guatemala

Greece

Germany

France

Egypt

Cyprus

Dominican Republic

Croatia

Colombia

China

Chile

Canada

Bulgaria

Brazil

Austria

Argentina

1 Angola

294

While the bulk of attention in the sector often shines on

Ámbar foresees significant opportunities in specialized clinics,

of eyes with complete or partial aniridia, Sonendo’s

hospitals and medical devices.” However, Contreras adds that

GentleWave system that features a unique fluid delivery and

not all startups in Mexico are at a point to warrant investment

control system for root canal therapy, HeartLogic by Boston

and turn this income into sustainable business opportunities.

Scientific that predicts potential heart failure weeks in advance

The firm “only invests in growing-mode companies with a

and detects early signs of worsening heart failure.

defined client base, a proven business model and consistent and growing income,” he says.

Technological innovation is happening at all levels of healthcare supply chain, but all of them have one thing in common:

Among the challenges, according to the OECD’s Estudios del

interoperability and connectivity. Individuals increasingly

Centro de Desarrollo Startup América Latina (Studies of the

want wearables and technologies that adapt to their needs.

Latin American Startup Development Center), is a country’s

“People now are far more integrated with the digital world;

ability to strengthen its innovation dynamics. That relies on

they communicate differently,” says Apolo Health’s Potes. The

the willingness of the public and private sectors to find forms

company’s A11 platform is an illustration of how a business

of cooperation at different levels to develop public policies

must supply a user-based type of healthcare to meet digital

and spaces where new entrants can gain opportunities and

demand in conjunction with healthcare requirements. Potes

support. Startups can also improve their chance of success in

says that A11 patient engagement instruments include a

the market by including strong advisory elements. “[Startups]

portable app that is 100 percent blank so the health provider

that have a relevant and active advisory board ... tend to

can satisfy the patient’s digital requirements.

outshine others,” says Lourens Verweij, Managing Partner at

INNOVATIVE THERAPIES

Additio Investment Group & Industry Advisor.

To help ease the burden on Mexico’s health system, both

TECHNOLOGICAL ADVANCES

Mexican and foreign companies are working to develop

Medical devices and wearables are among the leading areas

innovative products and therapies. Engineering techniques

for innovation, but both face different challenges to enter

for tissue and organ regeneration, according to an article

the health market. Contreras says it is important to make a

by the International Journal of Molecular Sciences, have

distinction between medical technologies and medical devices

enabled the production and marketing of various skin

when talking about innovation. “Each type of technology

grafts applied to patients over the past 30 years. Most

has a different timeframe for development. While software

grafts have been developed using biodegradable materials

or applications might take months to develop and the risk

of natural or synthetic origin. Biotechnology is also

might be lower, approval and deployment can take years.”

generating products originating between the medicinal and food industries to create biotechnological foods. “The

Overall, the most innovative products of 2019, as highlighted

idea is to offer natural, regional and seasonal foods that

by the prestigious Prix Galien Award, supported by the

stray from traditional pharmacology,” says Antonio Cruz,

Galien Foundation, include Lynch Biologics’s recombinant

CEO of Kurago Biotek. “We expect functional products

human platelet-derived growth factor-BB (rhPDGF-BB)

to become the unit within Sanfer’s structure that starts

that stimulates the growth of mesenchymal stem cells,

to gain ground in the health prevention and wellness

HumanOptics’s CustomFlex artificial iris for the reconstruction

area,” he says.

Uruguay

United Arab Emirates

Turkey

Thailand

Bottom 5 countries

Taiwan

Switzerland

Sweden

Sudan

Spain

Slovenia

Slovak Republic

Saudi Arabia

Russia

Republic of Korea

Qatar

Puerto Rico

Poland

Peru

Panama

Netherlands

Mozambique

Morocco

Mexico

Madagascar

Luxemburg

Top 5 countries

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| VIEW FROM THE TOP

INVESTING IN HEALTHCARE SERVICES OFFERS VALUABLE FUTURE RETURNS JUAN MANUEL CONTRERAS CEO of Ámbar Capital

Q: As a private capital firm, what do you see as the biggest

a tremendous social impact by saving women lives. However,

opportunities in the healthcare sector?

adoption of new equipment and technology is always difficult

A: We only invest in growing-mode companies with

and getting approvals for use is extremely complicated in

a defined client base, a proven business model and

Mexico. For new startups, investing in this kind of process is

consistently growing income. In Mexico, we focus our

costly, takes a long time and is very risky. However, it pays

operations solely on the education and healthcare services

off when companies manage to get past the process. We are

areas, given the significant opportunities to generate social

aware of the risks and we want to be there for players that

and economic impact. After several years with extensive

need the resources to make their business grow.

presence in the healthcare services arena, Ámbar foresees 296

significant opportunities in specialized clinics, hospitals and

Q: What would be the ideal conditions for new investments

medical devices. Pharma is definitely an attractive sector,

to bloom more effectively?

but since it is not in our area of expertise and it demands

A: Overall, technology development, regulatory procedures

high specialization, we do not participate.

and capital investment should be closely integrated. Strict regulations will always be necessary given the nature of

The private hospital sector in Mexico is in a mature stage,

the healthcare business; however, they have to adapt to

meaning there are few big operators with country-wide

market reality and end-users needs. Companies cannot be

presence while most are single hospitals with local presence,

subject to countless tests when a statistical sample would

thus opportunities for consolidation are huge. However,

be adequate to determine a new technology’s application

one of the main factors for success in this space lies in the

and the benefits for patients. Through our venture with

ability to serve patients at the lowest possible cost, since the

Onko Solutions, for example, we established a partnership

natural market for them are patients paying out-of-pocket.

with Grupo México’s Tren de la Salud to use Onko Solutions’ cervical cancer detection device. The equipment has

On the other hand, the specialized clinics segment is relatively

already been approved by COFEPRIS and is used to save

new in Mexico compared to Europe or Asia, we think it also

the lives of women who would otherwise fail to get an

offers interesting opportunities especially among leading

early diagnosis.

players in the non-communicable disease segment. Conditions such as diabetes, hypertension and heart failure have become

The country must find a way to take advantage of

the main drivers of the mortality rate in Mexico and we expect

technological developments. Making available healthcare

this trend to continue given the aging population. As a result,

services to remote and very poor areas was indeed a

specialized clinics will have an even bigger role to play.

demand of the population, putting pressure to adapt public policies.

Medical devices are a risky bet, but with much higher potential returns. We decided to invest in Onko Solutions, a medical

Q: How can the public and private sectors strengthen their

devices company focused on early detection of cervical

collaboration to improve the overall healthcare sector?

cancer leveraging Mexican high-tech knowledge. From our

A: Looking at both sectors combined, the number of

perspective, Onko can really transform the industry and have

hospital beds in Mexico could satisfy total demand. There are problems in terms of pairing beds available with local demand or services offered with treatments required. The

Ámbar Capital is a private equity firm specialized in the

most natural road to follow is to enforce collaboration

education, technology and healthcare services sectors. Ámbar

through various schemes that favor the use of all available

Capital is a shareholder of Monterrey-based Hospitaria, a

hospital infrastructure in the country without the need to

50‑bed hospital for middle-income patients

devote public investment to build more.

VIEW FROM THE TOP |

STARTUP CONNECTION COMPLEMENTS INNOVATION EFFORTS ARTURO BAÑUELOS Founder of Balero

Q: What kind of early-stage startups do you work with?

At the same time, we sit down with startups to understand

A: We define early-stage startups as those that have already

their core business and the verticals in which they work.

finished their minimum viable project. This means that they

Once we have this understanding, we propose additional

already have a product, they have users and preferably they

lines of action that might not be as visible for the company

already have sales. If they do not have recurring sales, we ask

and then we generate an approach to incorporate them into

them to have users and to be in the process of monetizing

our portfolio and analyze if there is a match with one of

their product. Although these are not restrictions for startups

our larger partners. Should there be a match, we ask for a

to participate with us, they are important variables we take

“champion” inside the company who can help us and the

into consideration when analyzing candidates. We provide

startup in any area where we might need help. Alongside our

these players with the structure they need to become a

corporate sponsor, we plan for a pilot or test run. These tests

global startup. Because of this, another characteristic we

are paid to the startup. We believe a commercial exchange is

look for in startups is that they have a global vision or can

important right from the start. If the test run is successful, the

provide global scalable solutions. Companies collaborating

company analyzes whether the solution is significant enough

with us should not only solve a local problem but apply a

to either invest, acquire it or make it a company product.

global-level model that allows for quick scalability.

Should companies not find a match among the startups in our portfolio, we can present options that might not be part

We work with startups from all sectors and we only ask them

of our portfolio. We are always attracting more startups that

to have a technology base. This does not mean they have to

impact certain verticals we know we work with.

be mobile applications or from the IT sector. For instance, we are looking for startups that have a technology base in the

Q: What difference does it make for corporations and

solutions they are developing but that can impact any sector

investment funds to work with accelerated and pre-

or industry. In this regard, we have many startups coming

accelerated startups?

from the health sector that comply with these characteristics.

A: We provide structure and formality to any startup that works with us and we help it set an administration

Q: How can Balero connect companies, investment funds

board. This allows for a smoother interaction and better

and startups?

understanding between the startup and corporations,

A: We try to generate alliances with big corporations because

which tend be institutional. Working with a company in

they are heavily invested in topics such as innovation

our portfolio can also help both the corporation and the

and development. We offer to have their innovation and

startup to match their speed in terms of R&D.

development departments up-to-date through the work of startups and we try to complement or improve their offering

Q: What are the obstacles and opportunities that health

through startups that relate to what they do. With hospitals,

entrepreneurs face, compared to other sectors?

for example, we might establish a connection with health or

A: Startups need to comply with regulatory issues and trial

even entertainment startups to the benefit of the patient.

periods. On many occasions, this also means obtaining certifications, which requires larger investment sums and

We demonstrate investment opportunities to companies

more time to see a return on investment.

so they can generate new business. It is not oriented innovation, as it does not come from a specific need a company might have. We show companies the innovation

Balero is an investment fund that looks to connect private

portfolio of many startups and how they are impacting

funds, corporations and startups. Its main objective is to

different sectors and ask them if they are interested in

develop

participating to generate a new business unit.

early‑stage startups

investment

opportunities

technology-based

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| VIEW FROM THE TOP

FUNDING THE FUTURE OF HEALTHCARE IN MEXICO LOURENS VERWEIJ Managing Partner at Additio Investment Group & Industry Advisor

Q: What characteristics should a startup have for Additio

and industry fields and that also follow a well-designed

Investment Group (AiG) to invest in it?

development path that includes PoC, Clinical, PoB and

A: We pay particular attention to opportunities that are

other elements, tend to outshine others.

in line with our general healthcare industry expertise and where we can add direct value, mainly MedTech and Digital

I have been inspired by the local entrepreneurial spirit

Health. We are especially looking at Seed and pre-A rounds

and drive of building ventures. Paired with an ongoing

of healthcare ventures that have reached, or are about to

need for innovation in the healthcare industry to ensure

reach, certain milestones.

better access and patient wellbeing. These are strong driving factors behind the investment opportunities we

298

As AiG is a new fund, currently launching AiG1, we are in the

see in the region.

midst of consolidating some of our previous operations and are actively building our portfolio where for the period to

Q: Why should startups consider AiG the ideal partner

come we anticipate four to six transactions, all focused-on

to grow its business?

healthcare. From previous operations we are engaging in a

A: Across the regions we also see an exciting increase

wide range of projects, where common factors as chronical

in Business Angel activities and higher average VC

conditions, accessibility and the potential for scaling are

ticket. In the case of the healthcare venture that are in

important indicators. A needs-based solution is mostly a

our range, they are often in need of both, a larger than

prerequisite, where each of them seeks to solve a specific

general BA investment and a more hands-on support

area in the healthcare sector.

from professional industry experts. AiG was created to address this exact need and therewith we are somehow

AiG focuses on providing added value in MedTech and Digital Health

a hybrid fund. Q: How is AiG attract startups and what role does it want to play in shaping the future of healthcare? A: At AiG we focus on a rather niche area where most

Q: What factors does AiG consider to determine the success

of the operators and key stakeholders know each other.

rate of a startup in the healthcare sector and what steps can

In addition, as industry focused fund we are actively

they take to increase their chances of success?

involved in the ecosystem, working with many startups as

A: Naturally each investor has its own way to determine

they participate in accelerator programs, industry events

what she or he expects to succeed. Some key ingredients

and alike. This in addition with the word-of-mouth from

we define are the extremely well-articulated relevance, the

the ventures we are working with has an even stronger

healthcare industry understanding and the entrepreneurial

positioning than digital media presence.

excellence in all aspects. As a group of industry experts and investors we have a In addition to the above, we see that those that have

couple of key mandates. Naturally one is the healthy return

a relevant and active advisory board in the medical

of our operations, where key drivers for our Management team are much focused on the value added to the entrepreneurs we work with. Supporting the successful

Additio Investment Group (AiG) is an international group of

go to market of their innovations, the exponential venture

investors and industry executives that support high-integrity

development, and ensuring the positive impact of the

entrepreneurs with the potential to build great businesses. The

portfolio ventures on the healthcare industry and its

group specializes on the healthcare and life science industries

patients.

INSIGHT |

DATA AVAILABILITY, UNDERSTANDING OPEN DOOR TO NEW BUSINESS MODELS GERMÁN MONTOYA Chief Exponential Officer of Rokk3r Labs

The enormous amount of available information is changing

Even though technology and data use have permeated

the way different industries behave. The insurance sector is no

many dimensions of healthcare, Rokk3r Labs sees

exception, says Germán Montoya, Chief Strategy and Creative

significant opportunities in the insurance arena, particularly

Officer of Rokk3r Labs, who touts insurance technologies,

in the implementation of InsurTech. “In general, Latin

or InsurTech, as a key disruptor. “InsurTech and general

American countries have very low insurance penetration

healthcare are changing mostly because of the amount of

rates. Life insurance penetration in the region does not

new data points available.”

even reach 2 percent of the population. Chile has the highest rate at 4.8 percent,” says Montoya. Among the

Rokk3r Labs, a business accelerator that supports companies

industry barriers he has identified for the industry is the

developing innovative and high-technology solutions through

lack of understanding of insurance products and the way

a risk-mitigating approach, is betting on healthcare because of

the business model has developed. “People tend to see

the opportunities that technology offers to disrupt the sector

insurance as an additional expense rather than as an

for the better. “Disruption in healthcare is coming in a million

investment.” Still, Montoya is convinced the InsurTech

ways. Everything is changing, from telemedicine to surgery,

industry has significant potential in the Mexican and

genetic research and DNA management,” says Montoya.

Latin American market and Rokk3r Labs is making sure it

However, unlike previous changes that focused mainly on

can participate in the industry’s boom. The company has

disease discovery and new reactive treatments, Montoya says

already invested in another player with a portfolio of 18

the industry’s transformation extends to the way the sector

InsurTech startups as clients. “We are now focusing on how

is understood. “The whole industry is being rethought, even

to grow these companies. The idea is to start in Mexico

philosophically, from a palliative and reactive perspective to

offering life and healthcare insurance and then work our

prevention.”

way through the rest of the countries.”

This change opens the door for the implementation of new

Although Rokk3r Labs has the capital and expertise to help

business solutions based on technology and data availability

technology-based companies to grow, Montoya says if these

with a preventive focus. “In the past, we could only get data

companies wish to be successful in the healthcare industry

regarding the physical state of a person when they were

they must comply with three main elements: an attractive

sick. Today, wearables can generate data on how people live

value proposition, a feasible project and a team that can

before getting sick.” Data availability has been key in creating

deliver. Particularly in the healthcare sector, Montoya says

a movement that places prevention and predictability front

technology players must consider a long-term approach.

and center. “The arrival of Big Data tools, AI and blockchain,

“Unlike other industries, healthcare requires significant funding

among others, helps us to collect and analyze more reliable

to perfect solutions before releasing them to the market.”

data to predict and prevent disasters.” Rokk3r Labs is focusing on InsurTech but there are many Montoya says technology also translates to better care for

areas of the sector that are ready for disruption, such as

patients and savings for companies. “Patients can now keep

telemedicine and the way the industry is managed, according

track of daily activities, such as sleep or exercise, to prevent

to Montoya. “There are many opportunities around efficiency

diseases. Moreover, blockchain applications could allow for

that are important and that could help in terms of price and

availability of patients’ medical records, making them easily

access to healthcare.” An example of this opportunity lies

accessible at any moment.” Regarding companies, Montoya

in the 40 to 50 million people who do not have access to

says it is easier and less costly to prevent a sickness rather

healthcare. “The opportunity to provide efficiencies for these

than treating it, especially chronic degenerative conditions

people is huge. We just need to have the right partners to

that are linked to a person’s lifestyle.

build on those opportunities,” he says.

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| VIEW FROM THE TOP

A TECH PLATFORM TO DEMOCRATIZE HEALTHCARE JOSÉ LUIS ELIZONDO Founder of Wellmedic Health Centers

Q: How do Wellmedic Health Centers’ services

equipment each type of specialist needs. We provide

differentiate from other telemedicine platforms?

growth opportunities and unique experiences for

A: Wellmedic Health Centers started operations in 2016,

healthcare professionals. We also provide physicians with

in the wake of the increasingly popular co-working model

extra services, such as phone assistance from our own

trend. We brought that model into the healthcare sector

staff to manage their agendas and billing. We can also

through our Intelligent Health Centers. Our core business

offer financing schemes to patients that require them.

is to offer office spaces to medical professionals in the

300

best available locations to allow doctors to connect

Q: How will Wellmedic’s model increase access to

to their patients. We first established in the del Valle

healthcare?

neighborhood in Nuevo Leon, as the region has strong

A: One of our goals is to democratize healthcare through

purchasing power. We have already opened three more

access to quality services. About 70 percent of doctors in

centers, two in Monterrey and one in Merida. Overall, we

Mexico are general practitioners and the rest are specialists.

offer 120 consultation offices and our goal in the next

Most of the latter are clustered in five states in the country,

five years is to open at least one health center in each of

leaving the rest without coverage. As a result, a woman

Mexico’s 32 states.

with breast cancer in a rural town of a southern state will not have the same opportunity to obtain specialized care

Q: What are the main benefits doctors and patients get

than someone in a major city. By spreading Wellmedic’s

from using Wellmedic’s infrastructure?

Health Centers to every state, specialists can bring their

A: We are the first healthcare-oriented co-working

services to regions that might lack them.

space in the world. Our model has gradually evolved and we are now in the 2.0 version. We believe we can

Q: How is Wellmedic using technology to expand its

contribute to healthcare by promoting disruption and

reach throughout the country?

the democratization and demonetization of the sector.

A: From the start, we believed digitalization could help a

In the current private healthcare model, doctor are

doctor’s professional development. For that reason, we

businessmen selling a product and also have to handle

invested in the most robust telemedicine platform in the

their own administration services and billing. Our goal is

market, which led to several success stories connecting

to help doctors by freeing up their time and not having to

our doctors with patients across the globe.

worry about those extra activities. We cater to all types of medical professionals, including doctors, psychologists,

In 2018, we developed Wellmedic CONNECT. This model

nutritionists, dentists and physical therapists.

allows us to create small medical consultation centers in areas close to the patient. Since mid-2019, we started

Doctors need personalized service and a strong platform

incorporating this platform to one of the largest pharmacy

to back them up. We offer much more than a space

groups in Nuevo Leon and Mexico City. These “mini” health

to rent. Our goal is to empower doctors through our

centers use telemedicine to turn a general practitioner’s

memberships. Our infrastructure and services allow us

office into a specialized center. Doctors use our platform

to provide fully furnished consultation rooms with the

to connect with a remote specialist and provide a more accurate diagnosis. Meanwhile, specialists can use an electronic signature to prescribe to the patient at a distance.

Wellmedic Health Centers is an empowerment platform for health and wellness professionals with a 4.0 smart rental

We are the first company in Mexico to provide a service

scheme. It is building Mexico’s largest private network of

of this kind, which has proven popular, receiving about

telemedicine practices

800 patients on average per store.

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A NEW HEALTHCARE REALITY THROUGH VR RODRIGO PADILLA CEO of Happinss

Q: How does your product help relieve health issues such as

aid to improve results. By reducing stress and through

stress and anxiety?

mindfulness training, we want to harness the power

A: Our technology is based on four pillars: diagnostics,

of self-awareness. The mind is like a muscle and with

awareness, monitoring and reduction of chronic stress. It

Happinss we can train it to properly direct its attention,

uses a series of tools that can help to alleviate stress, foster

taking the person away from the thought stream that

mindfulness and harness the power of self-awareness. We

keeps on feeding negative thoughts. That being said,

provide an immersive experience with music therapy, guided

Happinssâ&#x20AC;&#x2122; goal is not to make people have continuous

meditation, mindfulness and nature-like environments, we

positive thoughts but to teach them to direct their

have found that in 10 minutes of Happinss therapy we can

attention to the present.

lower stress levels on average by 42 percent. Q: How can VR, specifically Happinss, aid in treating other

Happinss is a platform developed in 2016 that empowers

mental health issues?

employees to manage their stress and improve their mental

A: Our goal is not to replace conventional therapy or

health. It uses cutting-edge virtual-reality experiences and

medication; VR is not intended as a full cure but as an

biometric feedback, fostering mindfulness in the workplace

VIEW FROM THE TOP |

TO INNOVATE, COLLABORATE ADRIANA VALLEJO Monterrey Chapter Leader of Hacking Health

Q: How does Hacking Health foster innovation in the

A: The first barrier we faced was the need for

healthcare sector?

multidisciplinary teams to collaborate to develop value

A: Hacking Health is a global movement that seeks to

proposals that really impact the sector. Entry barriers are

improve healthcare through technology, innovation and

high and startups have to validate their project at the same

collaboration. The organization has become a meeting

level as a large company. Therefore, projects require the

point for different players in the health sector that seek

support of companies and decision-makers who already

to generate innovation and technology development.

know and operate in the market. Another key issue is

We have been working at the Monterrey chapter for

the regulatory framework. Far from fostering innovation,

more than three years and we have held monthly events

regulation sometimes hinders the process.

to support a large number of entrepreneurs working on several sectoral issues. To date, we have held four hackathons.

Hacking Health is a worldwide movement that brings together technological innovators with healthcare experts to build realistic,

Q: What are the main challenges that Hacking Health

human-centered solutions for healthcare problems. It is present

observes in the Mexican healthcare system?

in Monterrey, Guadalajara, Queretaro and Mexico City

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MENTAL HEALTH THROUGH THE CHATBOT CONNECTION ANDREA CAMPOS Founder Director of Yana

Q: Treatments for depression include psychological and

but they do not offer the intelligent conversational model.

even pharmacological care. How does Yana contribute to

We provide automated responses trained to recognize your

mental health?

particular answers.

A: Treatment for most mental health conditions like

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depression or anxiety may include therapy and, in some

We launched a private Minimum Viable Product on February

cases, medication. At Yana, we do not try to compete with

2018, but did not want to launch it to the public until we got

these two types of treatment but rather to provide a way to

the approval from COFEPRIS. We do not need a medical

connect the user with the adequate treatment. Many people

license because we do not offer a medical treatment or

struggle with mental health issues but can take a long time

provide any medical tools; however, we do want to follow its

before seeking help. In Mexico, the average time between

regulations because we work in the arena of health. Our goal

experiencing the first symptoms and seeking help is 14

is to launch Version 1.0 and reach around 10,000 users by

years. We try to eliminate the barriers that stand in the way,

the end of 2019. Yana’s Version 1.0 will be released through

including the stigmas that stop people from speaking out.

Facebook Messenger and will be powered by natural-language processing and machine learning to better understand our

Yana is not only for those with depression or anxiety; it is

users’ language. This version will include a way in which users

meant to help anyone to improve their mental health state.

can understand their thoughts and feelings on a daily basis

Yana is designed to help people overcome the obstacles

so we can paint an accurate picture of their situation and

in their lives and become better versions of themselves.

provide tailored recommendations to make positive changes

For many, this can help people to seek out therapy sooner,

in their lifestyle.

drastically reducing the current average of 14 years it takes for people to seek help, and prevent them from committing

Q: How does Yana’s business model work in terms of

suicide. For others it can help them to take more control

subscription, in-content ads and other revenue generators?

of their lives, go to the gym, get a job, or pursue a passion.

A: We intended to be a civil association but we decided against it because we did not want to depend on public

While Yana does not replace therapy, we do use cognitive-

funding. This would limit our possibilities to reach as many

behavioral strategies that are usually delivered in therapy

people as needed.

and put them in the hands of hundreds of people so they can benefit from them at any day, at any time, using their

Although Yana will be free for our users, in the medium

smartphone. Since Yana is automated, it can talk to 1 person

term, we are going to seek for different forms of revenue

or 1 million people at the same time, without the need of

streams. One option is a subscription model, where we can

human intervention, unless it is necessary.

offer different packages that give access to different parts of the chatbot and for different lengths of time. Another option

Q: You have several competitors but they are all in English.

could be a B2B model, which would require us to work with

Are you a unique product in the Spanish speaking world?

institutions that want to improve the mental health status

A: In Spanish, there is no other application like ours.

within their workspace. An example is a university that could

There are apps that reach out through chat platforms,

receive information about the emotional state of their students by using our chatbot. By having a better picture of where critical issues occur, institutions can take steps to change.

Yana is an automated conversational agent developed by

We have also looked at the option of insurance companies

the company of the same name that helps people achieve

covering our services. This has been challenging because

emotional well-being through strategies based on cognitive-

insurance agencies want guarantees regarding the length of

behavioral therapy. It currently focuses on depression

treatment and whether it will have an impact on the patient.

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PERSONALIZING, SCALING THE NUTRITION BUSINESS JAVIER BARRAGÁN CEO of Avena México

Q: Many applications are geared to helping users lose weight.

Q: What are the unique characteristics of Avena’s

How does Avena differ from other apps in the market?

business model?

A: The industry is filled with nutrition-related applications

A: Nutritionists buy the software and then pay either US$15 or

because it is a very sexy industry that easily integrates into

US$25 to continue using the application. We also charge them

anyone’s lifestyle through their phone. Our difference is in our

a 7 percent commission on every online payment they receive.

retention rate. Unlike other apps where only 5 percent of users

Each nutritionist decides how much he is going to charge a

stay with the app after 60 days of use, we retain 50 percent.

patient. To date, we have almost 7,000 nutritionists working with us. On the user side, not everyone comes via a nutritionist

Although having an app to regulate nutrition is appealing in

who is already on the platform. Some people find us as a result

many ways, creating the technology is a challenge in the sense

of recommendations. These users sign up for a three-month

that you need to be able to analyze patterns of consumption.

predefined plan. We analyze their profile and assign them a

You cannot put an entire population in the same category;

nutritionist who has had patients with similar characteristics.

you have to differentiate between people and treat them

We act as a marketplace for these types of patients.

differently. We performed a behavioral analysis and instilled the app with a human factor. Rather than just sending

Q: What strategies does Avena employ to position its app in

notifications to our users, we put a person on the other side

the market and increase its subscriber base?

of the app. Having a real person asking our users how they

A: Our team has an engineering profile, which has allowed us

are feeling completely changes user engagement, making it a

to position our app as one of the best in the country. Since

more personal interaction that generates empathy. Although

we are market leaders, whenever we release a new feature,

the app itself can easily follow up on a user’s progress, we

our competitors try to replicate it, but since they lack this

noticed that having another person do the follow-up elevated

engineering profile it takes them longer to release new

engagement and retention levels.

features, or they replicate something that we already know does not work. This gives us an advantage. We do compete

We provide users with a coach who has the tools to analyze

with some apps from the US. I believe there is a great deal of

the user and generate insights to discern what our users

competition when teams are highly technical. When it comes

are looking for. People living with diabetes, hypertension or

to nutrition, you always need to have someone specialized in

cholesterol also have the option to upload their clinical analysis

that; when you are talking about startups you need technical

for us to review so we can offer a better option for them.

teams and teams that can make a product grow quickly using any medium. If we only used Facebook to promote Avena,

Q. What requisites and benefits do nutritionists see when

we would need to invest a lot in order to be competitive. Our

working for Avena?

challenge is how to do it in less time and with less money. In

A: We provide the tool to nutritionists; however, they are in

Mexico, we have fared very well and at the end of the day,

charge of registering their patients and how much they will

the competition in this type of business is global. We have

charge and how to charge their patients. Among the benefits

clients in Mexico, Chile, Ecuador, Canada, Argentina, Colombia,

is that they can reduce costs, such as office rent, and can

Guatemala and even some in the US. Brazil is the only country

attend patients who live in other cities.

in Latin America where we do not have clients.

The challenge is scalability. Every nutritionist can treat up to 300 patients per month. However, the market is asking us

Avena is an app that combines AI and nutrition consultants. It

for personalization and a human touch and these variables

provides users with a nutrition adviser and personalized plans

are not scalable. This is the challenge: how do we make this

to help change their health habits, lose weight and lead a

business scalable and, at the same time, keep it personal?

healthy life. Avena is available at Google Play and the App Store

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STARTUP BETS ON VIRTUAL REALITY TO TREAT MENTAL DISORDERS JOSEP TOMAS CEO of Miyabi Labs

Q: What are the main benefits of using Miyabi Labs’

several issues to develop their abilities. They also often lack

technology to treat ADHD?

social abilities. Being able to tackle these problems provides

A: Miyabi Labs’ technology acts as a support system for

individuals with the necessary tools to live a normal and

cognitive-behavioral therapy in the treatment of ADHD. We

successful life.

are not a replacement but a supporting tool that specialists can use to treat this disorder and improve the patient’s results.

Q: What are the main challenges Miyabi Labs faces to fully penetrate the Mexican market?

Patients receive many different benefits from using our

A: Ignorance and reticence are the main barriers. Some

equipment. Virtual reality allows us to control the environment

medical professionals are unaware of the benefits of new

the patient is subjected to, removing stimuli from the

technologies and others are reticent to use them because

real world and presenting them with a controlled vision.

they think this technology could become their competition.

The system can simulate everyday tasks in a controlled

Investors are also often reticent to invest in healthcare in

environment that the patient can then perform in the real

Mexico as they believe the sector to be too risky. Mexico has

world. Children often dislike regular therapy but find virtual

a poor investment culture, unlike the US or Europe where

reality to be a fun and engaging experience, which leads to

investors are more willing to enter the healthcare sector.

higher treatment adherence. Some therapists have already successfully incorporated this technology to their regular

Q: How can Miyabi Labs’ technology contribute to the

practice and have improved patient engagement.

treatment of other disorders? A: Our product does not only address ADHD but also helps

Q: How is Miyabi Labs working to promote the use of virtual

manage other neurological development problems, such as

reality as part of the treatment for ADHD?

autistic spectrum disorder. There are no limitations for our

A: We are working with universities to develop clinical research

growth as our system can be adapted to fit the needs of

protocols and with psychologists so they can incorporate our

any country. The only barriers are the cultural differences in

system into their practice. We are also working with school

handling development problems specific to each country.

psychologists so they can use this at their schools. One of our

Some cultures, for instance, reject medication or other

goals as Miyabi Labs is to positively impact society. We have

types of treatments. At this point, we are operating in

a support group for mothers of children with ADHD, which

Guadalajara and our goal is to bring our products to Mexico

allows us to provide mothers with personalized support. Our

City. We expect to continue growing alongside the Mexican

ultimate goal is for our equipment to be available at patients’

healthcare industry, which grows steadily year after year.

homes to support parents of children with ADHD. Our short-

Moreover, WHO has singled out mental health as one of the

term goal is for the equipment to be available at specialists’

main global problems to tackle in the midterm, meaning

offices and in schools.

many more opportunities for us. Technology is taking an increasingly important role in the treatment of mental

Q: How can technology help patients become more actively

diseases. New technologies, such as virtual reality, will help

involved in their care?

to manage many more mental issues, such as phobias or

A: Children with ADHD face problems in their neurological

phantom limb pain.

development, which can become a handicap and affect their quality of life and normal development. For some, these problems manifest as an impediment to developing

Miyabi Labs is a virtual reality startup that developed a support

social relationships. For others, it reflects in poor academic

treatment for Attention Deficit/Hyperactivity Disorder (ADHD)

performance or poor work life later on. Those who suffer

and other neurodisorders. It was developed with initial support

from ADHD are often highly creative and intelligent but face

from CEOCYTJAL, the Government of Jalisco, Balero and GSVlabs

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USING TECHNOLOGY TO CONNECT A FRAGMENTED SYSTEM LUIS LOJERO CEO of Mural Med

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Q: What is Mural Med’s value proposition and how can it

Q: How can Mural Med’s system promote better collaboration

help different actors in the health sector?

between health providers and other industry players?

A: Mural Med’s goal is to solve the fragmentation of the

A: Usually, our clients experience problems accessing

health sector. We generate a variety of tools or modules

information efficiently regarding everything that happens to

that function either jointly or independently, depending on

their patients. It is a complex problem because most clients

the needs of our clients. We define our complete solution

do not offer an integral health service. This complicates

as a population health manager, but clients can adopt

the centralization of information. However, that is what we

separate modules intended for patients and doctors. The

strive to do. With our modules, each player has its own tool

modules that interact with patients offer a web portal and

for interaction. When we integrate all the data, we not only

a concierge chatbot with AI that provide appointment

optimize and make the operation more efficient but also

scheduling services and information regarding health

improve other aspects like patient satisfaction, problem

services to patients.

visibility and availability of information for prevention and early detection. Each health service provider, with the patient’s

Our clients can be any player in the health sector with

consent, can choose to share certain information to make

large groups of patients, including insurance and pharma

processes faster and efficient. Patients themselves can access

companies, hospital networks and private practices.

their clinical medical record and information and share it with

Whenever a client implements one of our solutions, their

other players in their treatment and health journey.

patients have access to a portal or chatbot to learn about services, schedule an appointment, see their clinical

Q: Who are the most common clients that Mural Med

information, set reminders to take their medicines or

works with?

schedule a checkup.

A: Insurance companies and pharmaceutical companies that manufacture patented medicines have the largest patient

In addition to services and scheduling management, we

groups and the most complex patient management problems.

have a clinical module for health professionals. For this

These are entities that are willing to pay since our offering

module, we have generated important alliances, such as

has a very clear impact. The next group of clients includes

with VIDAL Vademecum for e-prescriptions. This integration

specialized clinics that want to have a competitive operational

allows us to prevent prescription errors. When more than

advantage over other players. The third group includes

one doctor is involved in a patient’s treatment, coordination

hospitals or networks of private practitioners. For this group,

is complicated. But when everything is integrated through

we have yet to find the best possible incentives. It is a more

our solution, the system checks there are no negative drug

complicated group but we believe they will gradually have to

interactions, no surpassing of the maximum dosage per

increase their efficiency and transparency, so we expect them

adult, no counter-indications due to allergies or because of

to also become an important client segment.

other medical conditions such as chronic kidney disease. The system creates an alert to prevent any problem a

We are piloting a product with doctors in private practices.

prescription might generate considering the patient’s

The solution we are proposing for them is a clinical file

profile or any type of medication they might be taking.

with management tools that is independent and private but that allows them to share the information with other players in the sector. With this, we can start automating

Mural Med is a digital platform developed by the company

processes throughout the health value chain, for instance,

of the same name that provides tools to manage health

with payment authorizations from insurance companies.

populations. Mural Med registers patients’ clinical information

With Mural Med, doctors can send their medical report to

over the life of their treatment

an insurance company.

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DIGITAL TRANSFORMATION COULD BLINDSIDE HEALTHCARE DAVID POTES CEO and Co-founder of Apolo Health

Q: What are the main trends you see in the health sector

of patients are shifting away from simple hospital visits.

at the moment?

Healthcare is increasingly becoming preventive as

A: Many hospitals think they are doing just fine,

opposed to solely curative. All these changes require

ignoring the fact that healthcare is changing rapidly. A

new forms of cooperation. Traditional industry players

transformation similar to what visual media encountered

have reacted by seeking more collaboration and, for the

with Netflix is coming to healthcare and many institutions

first time, I have seen hospitals and insurance agencies

are not prepared for this kind of disruption. Traditionally,

sitting down at the table to discuss how they can best

healthcare is about a consult between a doctor and a

work together. Yet, they are still far behind in terms of

patient. However, more and more businesses are springing

confronting the challenges ahead.

up that offer health services in alternative ways using new technology. Apolo Health is a digital integrator of health services for hospitals.

Treatments can also be provided outside the hospital

It offers two main services: Apolo Intel, which provides advisory

through new innovations and better communication

services, and Apolo Engagement, which allows healthcare

platforms. Due to the rise in chronic diseases, the needs

providers to create and build relationships with patients

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A PLATFORM FOR DOCTORS, BY DOCTORS TOMÁS IGLESIAS CEO and Co-founder of OMI

Q: What is the main added value offered by OMI and

Q: What complications can arise from applications that do

its platform?

not consider the doctor’s needs?

A: OMI is one of the first and few technology companies with

A: A patient’s medical evaluation is based not only on a

a doctor as its founder. Most applications and platforms in

physical examination but on the conversation with the patient,

the market are created by people from diverse professions

from which doctors can glean relevant information about the

who do not belong to the health sector. This means that

patient’s lifestyle. When an application does not consider the

these applications do not include the vision and needs of

doctor, it forgets to include aspects and observations that are

the doctor, resulting in an app that is difficult to operate by

key to a correct diagnosis. This translates to a treatment that

doctors. Therefore, OMI’s first and foremost strength is that

can be detrimental to patients’ health.

it is a platform for doctors created by a doctor to centralize administrative and clinical information regarding patients. Since patients own their clinical information, OMI makes

Organizador Médico Integral (OMI) is an electronic platform

their files transferable to other platforms, giving doctors

for managing clinical and business information. Its settings

access to a patient’s personalized and real-time information.

include a personalized agenda, quick access to patients’ clinical

Patients, however, still own and manage their data freely.

history and real-time notifications on a patient’s condition

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FUTURE OF ORTHOPEDICS RIDES ON EQUINE BONE TISSUE LORENA TIRADO Director General of Alternativa Médica Integral

Q: What made Alternativa Médica Integral the ideal company

results, each year we take a group of doctors to Italy to see

to represent Bioteck in Mexico?

how Bioteck products are made. The company’s Zimoteck

A: Alternativa Médica Integral is the only official distributor

cleaning process for obtaining grafts does not use chemicals.

in Mexico of the Bioteck brand. Bioteck is an Italian company

It employs enzymes to remove inorganic contaminants and

founded in 1995 and the leader in the production of bone

leave only the bony mining structure. This minimizes rejection

grafts for neurosurgery, orthopedic surgery and oral and

and infection risks because there is no remaining biological

maxillofacial surgery. We are the best partners for Biotech

material from the harvested animal.

in Mexico because we know the market and we know how

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to introduce innovative products to the country. Alternativa

Q: What are the benefits of using equine bone grafts?

Médica Integral has developed two flagship products, bone

A: Bioteck originally worked with porcine bone grafts but this

chips and bone matrices, which are used to fill cavitary defects

required too many permits in Europe to allow the products to

resulting from excessive bone wear.

be marketed and limited the possibility to cover worldwide demand. The main limitations were related to religion and

Q: In 2015, more than 340 surgeries used Bioteck bone

culture, so the idea of using equine bone grafts arose. Northern

grafts. How has penetration of this technology advanced in

Italy consumes a large quantity of horse meat and the bone

recent years?

of this animal is strong, due to its constant movement and

A: Our plan was to grow 10 percent annually. However, thanks

its anatomical composition. Also, equine-derived grafts have

to our successful collaboration with ISSSTE since 2017, we

no cultural or religious restraints, which made it possible for

have grown our participation in the public sector at an annual

Bioteck to market these products in 70 countries.

rate of 100 percent. Although public tenders have favored us in recent years, we are aware we must diversify our focus

Q: Who can benefit the most from using Bioteck’s grafts?

beyond the public sector. As a result, we estimate our real

A: Our grafts are for everyone but they are most useful

yearly growth at an average of 50 percent between the public

for patients who have a higher sensitivity and a greater

and private sectors. Our distribution network has helped us

probability of graft rejection. A doctor from a hospital we

grow our presence in Monterrey, Queretaro and Morelia on

work with told us that he had a case of a 43-year-old patient

both fronts but our development overall has been driven by

who had damaged his vertebrae in a skiing accident. This

the public sector.

patient tried grafts of different origins, even human, but his body rejected all of them. The doctor came to Alternativa

Q: How do Bioteck bone substitutes support the healing of

Médica Integral because he had heard about the benefits of

bone defects?

our products. Six months after surgery, the patient seemed

A: Our client doctors say that in comparison to other products

to have accepted the graft and his recovery was going well.

used for the same purpose, Bioteck’s solutions have better osseointegration. They are also 100 percent natural. During

Q: How will Bioteck’s technology impact the development

the 13 years that Biotek has been operating in Mexico in

of Alternativa Médica Integral?

the oral and maxillofacial area, there have been no cases of

A: Originally, bone grafts were done using the bones of the

rejection or postoperative infection. To ensure successful

patient receiving the graft. As technology and research progressed, innovative grafting methods were developed. To this day, Bioteck is the only company in the world that

Alternativa Médica Integral is a distributor of specialized

can produce a graft that is clean of any type of infection,

surgical medical products and materials. It is the exclusive and

including hepatitis, using its Zimo-Teck technology.

official distributor of the Bioteck brand, which offers innovative

These advances have had a great impact on the Mexican

solutions in bone regeneration

healthcare sector.

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NEW PRESCRIPTIONS INFRASTRUCTURE IN MEXICO EVERARDO BAROJAS Founder and CEO of Prescrypto

Q: Prescrypto is a digital platform that facilitates

is a doctor-driven market. The second stakeholder is the

communication between doctors, patients and pharmacies.

patient who receives the medication, while the other is the

How is your service different from similar platforms?

pharmacy. We have about 5,000 new patients every month,

A: We are 100-percent focused on prescriptions and the

all receiving prescriptions through our platform. Pharmacies

prescription process. We are not just an electronic patient

are integrated into our system only when necessary and/or

database, an electronic health record, billing assistant or a

if this is available. We do not require complete integration.

planner that helps schedule consults. Prescrypto contains

The patient can still make use of our app to know what they

a catalog of 26,000 medications and other products that

are getting at the pharmacy. If the pharmacy then requires

require a prescription. The most important thing for us is to

a printed prescription, the doctor can also provide that. The

establish a streamlined communication between the doctor,

concept of electronic prescriptions started in 2000 in the

patient and other stakeholders, such as a pharmacies.

US. Infrastructure there has developed to such an extent

Before us, there was no standard medication catalog in

that around 50 percent of prescriptions are electronic in

Mexico. There were documents that had information

the US. Mexico is still a long way from this, which puts

regarding medications, but they tended to be focused on

us in a position to play a strategic role in developing this

clinical data or were limited to the portfolio of the particular

infrastructure.

pharmacy that created it. To build our catalog, we had to consult a wide range of sources, from institutions to the

Q: What are your plans in terms of alliances with

web. What is significant is that we do not have a preference

pharmacies and other medication providers?

between medications. We want to be a neutral platform

A: We have several alliances and collaborations with

that offers everything we find and shares data securely

companies, such as Amazon. We also have pilot projects at

safekeeping the doctorâ&#x20AC;&#x2122;s and patientâ&#x20AC;&#x2122;s information.

some pharmacies where we are combining our platform with other applications. Because the technology is relatively new

Our platform provides two big advantages. First, it gives

in Mexico, it remains part of an interesting regulatory topic.

doctors a complete overview of different medical options.

We started in 2016, at a point when prescriptions still required

Doctors cannot memorize an entire catalog of thousands

a wet signature from the doctor. Now, there is a regulation

of medications and many more active molecules. Our

that deems an electronic signature equally valid. Even so,

platform provides a tool for this with up-to-date clinical

we still ask doctors today to sign the prescription the old

drug information. The second advantage is for the patient.

way. As time evolves and we continue to build the proper

Our platform ensures the doctor can make a choice

infrastructure, we will move on to an electronic signature.

with exact information on the dosage and even brand of medication. This ensures that the pharmacy that receives

We consider COFEPRIS an important partner and always

the digital prescription will know exactly what the patient

aim to provide full transparency in our processes. The

wants, avoiding switching medications at the point of sale.

commission has approved our system through recognition

Medications that are switched at hospitals and pharmacies

of three parameters: doctor identification, safety in the

for other brands may have other dosages, side effects or

channel of communication (information integrity) and

poor results. Our platform attempts to mitigate this and if it

avoiding double sales of a same prescription.

does happen, we ensure it is communicated to the doctor. Q: What role do pharmacies play in your platform?

Prescrypto is a free app for doctors and patients. It was

A: Pharmacies right now interact in a limited way with

developed to create, send and track electronic prescriptions.

our platform. We focus on one main stakeholder and two

It allows doctors to access a 26,000 product catalog with a

secondary parties. The former is the doctor, since Mexico

unique user experience

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HEALTHCARE ACCESS THROUGH SOCIAL PROJECTS KATTY BELTRÁN General Director of Fundación Dibujando un Mañana

Q: What advantages do companies get from participating in

reports elaborated by the organizations and an audit done

social projects with Fundación Dibujando un Mañana (FDM)?

by the foundation.

A: The foundation has over 21 years of experience in social

310

projects that boost social development in Mexico. Our

Q: What have been the most emblematic projects in which

investment model is based on transparency, efficiency and

FDM has participated in the health sector?

significant social impact. Therefore, companies that work with

A: The foundation has completed two projects in the health

us can be certain that their money will be wisely invested and

sector and has one in the making. The first project, called A

generate the maximum possible impact. To achieve this, the

Hospital for All, was based on the remodeling and equipping

foundation analyzes each project and social organization to

of Mexico’s General Hospital Dr. Eduardo Liceaga pediatrics’

measure its ability to generate impact and operability. Later,

area with the collaboration of the Naro Contigo Foundation.

it determines the investment risk that each represents so it

Through this collaboration, the Ministry of Health donated

can recommend only those projects that will have the greatest

MX$15 million (US$780,000) and the foundation gathered

impact and visible results. For the duration of the project,

another MX$15 million (US$780,000) through donations

organizations are audited by the foundation at different times

from different companies. The second project is an Alliance

and the money is conditioned to the results they deliver.

with Promotora Social Mexico called United to Give. This

Organizations have the responsibility to implement the project

collaboration has been operational for four years and has

as presented, with the correct procedure in time and form. If

benefited 38 institutions that work with over 21,000 children

this does not happen, the organization is penalized, financing

and adolescents with disabilities and a variety of health

stops and the money that was invested needs to be returned

conditions in 13 states.

to the foundation. This year, FDM did a study to measure the social impact it generates and the results showed that a peso

FDM’s most recent project is the remodeling of the hospital

invested in the foundation equates to five pesos invested in

in Valle de Bravo. This transformation will strengthen the

social impact.

hospital’s capability to provide healthcare to ensure it covers the needs of the municipality and nine others in its periphery.

Q: How does FDM measure the impact of a project?

The remodeling goes beyond infrastructure, since FDM is

A: We are a second-floor foundation, which means we

working to create a health network in the municipality and

are a social investment organization. Our strength is the

avoid saturation at its only clinic. The project is in the initial

measurement of impact and the analysis of civil organizations.

stage of deciding its construction model. Once this is finished,

We are work with more than 900 organizations nationwide

the foundation will seek to involve all industry sectors:

and four in Costa Rica. Measuring social impact begins with

government, private companies and nonprofit organizations.

the selection of the organizations that apply for a project. We only select organizations that have the experience and

Q: How do private companies get involved in projects?

capability to implement the project. FDM’s goal is to find

A: Their participation depends on the type of project and

the best organization in which to invest and generate the

the company’s expertise. For example, FDM developed a

greatest impact. Subsequently, Fundación Dibujando un

project called Community Integral Development Center

Mañana measures results by stages and the impact through

(CEDIC) that sought to improve the lives of children of workers and residents near the communities of Chimalhuacan and Nezahualcoyotl. Children live close to the

Fundación Dibujando un Mañana is an ally in efficient social

recycling work in the Xochiaca Board, which is the biggest

investment. The company has 21 years of experience advising

open-air trash dump in Latin America, so the goal was to

enterprises in which organizations and projects to invest,

provide them with a place where they could have access

generating sustainable changes to give children and adolescents

to health, education and nutritional services.

VIEW FROM THE TOP |

IMPROVED CARE THROUGH PREVENTION, AWARENESS ROBERTO TAPIA-CONYER CEO of Fundación Carlos Slim

Q: How is Fundación Carlos Slim using technological

throughout its history, the program has diagnosed 86,117

platforms to improve healthcare standards?

cases of diabetes, 136,106 cases of prediabetes and 121,605

A: Our platforms PIEENSO and Aprende.org address

cases of hypertension. To date, the Ministry of Health has

certification and training for healthcare personnel, mainly for

diagnosed 1.85 million Mexicans with at least one chronic

primary care workers who usually have fewer opportunities

disease using its 12,413 healthcare units. Of these individuals,

for training. These professionals work most closely with the

1.08 million were diagnosed with diabetes, 1.21 million people

general population because they oversee prevention and

with hypertension, 699,399 with obesity and 519,297 with

care of 85 percent of all diseases. As a result, they require

dyslipidemia. Of the 1.07 million diagnosed with diabetes,

continuous training to have up-to-date knowledge. We have

52.2 percent received a glycosylated hemoglobin test and

developed diplomas in mothers’ health and immunology,

44 percent had it under control. We support the Ministry

which are essential for primary care professionals. PIEENSO’s

of Health by collecting information from the country’s

programs and syllabi were based on patient needs and are

healthcare units and processing it to improve the ministry’s

validated by UNAM.

decision-making process when crafting public policies.

Q: Which new platforms is Fundación Carlos Slim

Q: How is the foundation using IoT principles to improve

developing now?

care standards?

A: In 2019, we will focus on developing an app that will allow

A: Using digital health tools allows us to provide personalized

us to communicate with patients and provide them with

healthcare. Through Big Data, we were able to classify

cellphone access to the health information they need. We

patients into 21 profiles and provide them tailored

will focus on creating a healthcare ecosystem. Our platforms

recommendations according to their needs. This project

will allow us to use data science to benefit patients through

began in 2016 and has gradually expanded. In addition, its

better medical interventions. We work with national and

goals include improving measurement strategies during

international players to develop these courses because we

pregnancy, focusing on a number of areas. The first is to

believe in the importance of keeping healthcare professionals

predict whether a patient is at risk of gestational diabetes,

up to date in their medical knowledge. All our platforms

as about 10-12 percent of pregnant women are at risk of

are built in close collaboration with medical professionals,

developing this condition. In most cases of gestational

as well, to ensure they are easy to use and sustainable in

diabetes, the symptoms disappear after birth but in about

terms of growth.

40 percent of cases the patient remains at risk of developing diabetes later on. The second is to diagnose pre-eclampsia,

Q: What is the foundation’s CASALUD program’s role in

a pregnancy complication that increases blood pressure

improving healthcare policies?

and one of the main causes for maternal death. The third

A: Close monitoring helps people keep chronic diseases

objective is to measure excessive weight gain, which might

under control. In March 2015, only 10.4 percent of diabetics

lead to pre-eclampsia or to gestational diabetes. The fourth

had tested their glycosylated hemoglobin levels and 36.1

is to prevent premature births, which are most commonly

percent of those had it under control. By May 2019, 52.2

caused by urinary tract infections. The last objective is to

percent had taken the test and 44.3 percent had it under

eliminate mother-to-child transmission of HIV and syphilis.

control. CASALUD’s goal is to support the Ministry of Health’s efforts in terms of prevention. CASALUD is a digital platform at healthcare units located in public spaces, such

Fundación

as metro stations, where people can receive checkups and

association. It was created in 1986 by Carlos Slim to promote

orientation regarding their health. By May 2019, CASALUD’s

the integral development of Mexican and Latin American

MIDO program has provided care to 1.32 million people and

society. It implements programs to bridge the health gap

Carlos

Slim is

nonprofit

Mexican

civil

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RESEARCH, INNOVATION, KNOWLEDGE CREATE EFFECTIVE THERAPIES Paloma Vázquez Commercial Director of Bioskinco

Patricia Reyes Research Manager of Bioskinco

Q: What benefits can patients get from using Epifast and

epidermal necrolysis (NET), which are extreme reactions of

how does this differ from traditional skin burn therapies?

the body to the intake of medicines. Epifast works well in

PR: Epifast is a biotechnological product made from a

complex cases because keratinocyte cells release growth

human keratinocyte cell bank that is capable of releasing

factors that act in different layers of the skin.

growth factors. These growth factors promote a faster

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and better epithelialization process. In the 1980s, the most

Q: What benefits do doctors achieve by using Epifast?

common treatment for burn patients was to do an early

PV: Bioskinco is fully committed to quality and supports

surgical excision of the burned zone, but separation of

doctors on how to use the product. Bioskinco’s training not

bedsores could last for several weeks before the excision

only includes indication, contraindications and applications

could be performed. Advances in regenerative medicine like

of the product, we also seek to train healthcare professionals

Epifast help patients recover faster and better. Therefore,

in topics related to the best overall treatment, such as

the probabilities of infection, complications and time of

wound bed preparation and basic initial burn attention.

hospitalization are greatly decreased. Q: What applications or developments is Bioskinco

Epifast is a biotechnological product made from a human keratinocyte cell bank that is capable of releasing growth factors

planning for Epifast? PR: Epifast was developed in the 1980s based on a 1970s technology that focused on the culture of keratocytes. The great advantage of Epifast is that it was ahead of other products at the time and has become the most valuable contribution to regenerative medicine in Mexico at the moment. The future applications will come from the experience doctors gather from treating all types of wounds and will be illustrated through congresses and clinical trials.

Q: Which patients could benefit the most from Epifast? PR: Bioskinco’s biotechnological solution can be used for

However, Bioskinco does not stop there. The company

treating any condition of loss or damage to the skin. It

will continue conducting studies to improve its product in

is commonly used for burns because that is the line of

collaboration with the Institute Fraunhofer in Germany. The

research and development. However, several clinical studies

company will know exactly what it is measuring and check

and medical treatments have shown successful results on

the performance of growth factors being released. There is

the healing of wounds like venous leg ulcers, diabetic foot

always the possibility to improve our product and as science

and complex wounds.

progresses, Bioskinco will continue to improve Epifast.

PV: Epifast is an excellent treatment option for patients with

Q: What are Bioskinco’s midterm plans?

loss of skin integrity. Its benefits are well-supported for burn

PV: Bioskinco will maintain its focus on fostering the best

patients and we have clinical evidence for the treatment

quality of life for those patients who have a complex wound

of immune diseases such as epidermolysis bullosa or toxic

or skin loss due to any condition. Therefore, we will continue working to train healthcare professionals who are dedicated to treating those types of patients. We are also seeking

Bioskinco specializes in the manufacturing of Epifast, a

higher availability to benefit most of the patients who need

human-cell cultured epidermal allograft for the treatment

to recover from skin loss. Bioskinco seeks to further develop

of burns, skin traumas and chronic wounds. It is a spinoff of

and improve this product for Mexicans with the highest

CINVESTAV in Mexico

quality and at a low cost.

VIEW FROM THE TOP |

REGULATION, AWARENESS KEY TO EXTENDING REGENERATIVE MEDICINE REACH VICTOR SAADIA CEO and Founder of BioCenter

Q: How are BioCenter and regenerative medicine in general

to make recommendations based on nutrition and socio-

positioned in Mexico?

cultural factors to achieve better treatment results.

A: BioCenter is still in its initial stage, especially considering that regenerative medicine remains in the development phase.

Q: What alliances have you established to promote the

Our role at the moment is to understand how this branch

adoption of regenerative medicine?

of medicine will impact the Mexican market, since the topic

A: Government participation in regenerative medicine is

is fairly new and accessible only to a certain population

still limited and it will take time before these treatments

segment. Even treatment efficacy depends on each person; all

become the new normal in that market. However, we have

solutions are personalized and making statistical projections

established alliances with different clinics to create panels

becomes difficult.

that can collaboratively participate in developing research and regulatory frameworks.

Adoption has also been slow among the medical and pharmaceutical industries because most professionals do

At the moment, we are lobbying for clear and integral

not know much about the subject. Traditional medicine

regulations so companies wanting to participate in

is highly methodical and there is considerable skepticism

regenerative medicine can play according to fair and adequate

when it comes to new treatments. Furthermore, the medical

rules. Efficacy tests, for example, must evolve to adapt to the

industry is dependent on pharmaceutical companies that

reality of new treatments. Right now, Mexican law demands

have built truly hegemonic practices. It is difficult to break

that companies present statistical data regarding the efficacy

such an ingrained paradigm. Lastly, regenerative medicine

of any solution, which would equate to presenting phases I

faces issues related to regulation and general understanding

through IV of a medical trial. However, given the nature of

of the concept because the science does not refer only to

regenerative medicine, no two patients receive the same

stem cell therapy.

treatment or dose, so it is impossible to provide such data.

Q: What role can regenerative medicine play in generating

Q: What are the main trends impacting regenerative medicine?

a patient-centric culture?

A: There is a legal dispute regarding the differences between

A: People are increasingly willing to invest to stay healthy

hematopoietic and mesenchymal stem cells, which is why

rather than face the need to combat a disease. Overall,

we are pushing for different regulation relating to each type

medicine should focus on the patient, not on the disease.

of cell. We are also trying to define marketing guidelines so

Regenerative medicine, like its functional and integrative

companies looking to enter the market can understand how

counterparts, is considered a patient-driven industry,

to promote their products while avoiding false promises from

especially as patients are the ones demanding personalized

less serious players.

solutions and innovative treatments that focus on maintaining health rather than just acting when the problem

Medical tourism is also a hot topic in regenerative medicine,

appears. These are all different branches but they all share a

especially considering Mexicoâ&#x20AC;&#x2122;s attractiveness to US patients

patient-centric vision focused on medicine being predictive,

in terms of price and quality and due to the legal limitations

personalized, participatory and preventive, what we now

regarding these treatments in their home country.

call â&#x20AC;&#x153;P4 Medicine.â&#x20AC;? Access to information has made patients much more

BioCenter is one of the major Mexican companies leading

participatory in the treatments they get and the practices they

the introduction of regenerative medicine into the country.

adopt, which is key to the patient-centric approach medicine

The company is shaping a sector that will grow exponentially

should take. Similarly, patients are increasingly asking doctors

during the next decade

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| VIEW FROM THE TOP

MAKING THE MEDICINE OF THE FUTURE ACCESSIBLE GILBERTO MEDINA Director General of Novogen, Part of IVG Group

Q: What led to the creation of Novogen and how is the

as well as melanoma. We are considering adding a panel for

company working to meet the industryâ&#x20AC;&#x2122;s needs?

leukemia and the idea is to have at least one service for all

A: For many years, the industry has talked about having

types of cancer.

personalized medicine that generates an intrinsic benefit for

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the patient. Novogen identified this as a business opportunity

Unlike other laboratories or genomic services, we strive to

and a way of benefiting the community. We created a

provide the doctor with functional and relevant information

business proposal that merges two factors, our laboratoryâ&#x20AC;&#x2122;s

only. We do not intend to sequence all genes in the human

specialization in genomics, genetics and molecular biology

body and then provide a report on our discoveries, but to

and our collaboration with international laboratory equipment

focus only on the most relevant information for disease

and reagent manufacturers. All this with the goal of

treatment. That is our main differentiator and where we saw

contributing to an improved clinical diagnosis.

the largest market opportunity. Unlike other alternative tests in the market, we provide the doctor with flexibility regarding

Q: What are the potential uses of personalized medicine

access to the available information and if the doctor wants

based on genetics and genomics?

to, we can select only certain pieces of data. Novogen also

A: Laboratories that constantly launch new pharmaceutical

is a 100 percent Mexican laboratory, which means we can

products make significant investments in statistical population

advise the doctor in the interpretation process as well. We

studies to develop personalized medicines for specific

try to provide a concise and easy-to-interpret report, so

diseases. What our technology can do is provide precision

the doctor has all the information needed to determine the

in diagnosis. We are launching a characterization system for

best treatment for the patient. Should doctors require more

certain types of cancer that is directed toward supporting

information, they can access all the databases we used and

doctors with their diagnoses and final prescriptions. This can

the informatic algorithms that processed the information,

also have a positive effect on patients because doctors will

which are in a 100 percent integral AI platform that detects

know from the first moment the type of therapy they should

and classifies genetics variants associated with the disease

use, eliminating the possibility of prescribing inadequate or

and treatment recommendations.

dangerous treatments. Q: What is Novogenâ&#x20AC;&#x2122;s client distribution between the public With our system, doctors receive an insightful report that

and private sector?

states which treatments are recommended given the

A: For oncology tests, we only focus on the private sector.

mutations related to these particular diseases. Specific

We are presenting the project to the pharmaceutical industry

variants present in different types of cancer are associated

and to insurance companies. Thanks to the alliances we

with an increased sensitivity to particular medications. This

have made, such as that with Grupo SOHIN, we have made

could be extremely beneficial for oncologists and patients,

significant progress with insurance companies and have

since most targeted therapies are associated with similar

obtained a pre-approval from some of the most important

or higher effectivity but fewer side-effects when compared

insurance companies in the country. Our main concern is

against conventional therapies. At our lab, we have NGS

being able to reach a larger market so we can benefit more

panels used to study breast, ovary, lung and colon cancer,

people. We are open to working with the government and analyzing how we can collaborate to benefit the entire sector. The ideal scenario should be to democratize personalized

Novogen, part of IVG Group, provides advanced nucleic

medicine and for this to happen, the public sector must be

analysis techniques for paternity tests, human identification

involved. A good diagnosis is beneficial to everyone and

services, rare disease diagnoses, Sanger, next-generation

helps to save costs for patients, doctors, pharmaceutical

sequencing and metagenomic analyses

companies, insurance companies and hospitals.

VIEW FROM THE TOP |

ACCESS TO GENETICS WOULD IMPROVE PREVENTION, TREATMENTS JORGE MORAN Director General of Genetics and Health

Q: What added value does Genetics and Health offer to

the government on how we can address the costliest disease

hospital and clinical laboratories, as well as patients?

for the government: diabetes. Previously, we approached

A: Genetics is a completely different business compared

the Senate to explain the relevance of making genetics tests

to traditional medicine. Furthermore, geneticists have a

available to the entire population.

significant opportunity to learn how to communicate with doctors and most specialists have no complete knowledge

According to global standards, effective breast cancer

about genetics, which means there is a general lack of

detection methods must identify 75 percent of all cases on

understanding of what this science can do for medicine today.

time. However, in Mexico, only 23 percent of the cases are

When I entered the company in 2017, I realized there needed

detected in a timely manner, according to the Ministry of

to be a point of connection between the company and its

Health. The government has invested in CAT scan equipment

clients. We decided to build our sales force with doctors who

and prevention campaigns but nothing seems to do the trick.

could help their fellow physicians understand our analyses and

We participated in a roundtable with INCan, the Ministry of

offer a solution that matched the patientâ&#x20AC;&#x2122;s needs, an approach

Health and other institutions to discuss the role of genetics

that has had great success.

in early detection of breast cancer, where we highlighted that patients with a genetic mutation linked to breast cancer have

Another advantage Genetics and Health offers is access to

a 60-80 percent chance of getting the disease.

genetics tests for the general population. In Mexico, these tests are not covered by most insurance policies and there

Q: What are the main contributions that genetics can make

is almost no access to these solutions in the public sector.

to medicine?

This means patients seeking these services must pay out of

A: Approximately 30 percent of the newborns entering

pocket, thus making genetics tests an option only for the

intensive care die because of an improper diagnosis or a lack

high-income segment. We devised financing alternatives

of a diagnosis. Genetics could help identify genetic illnesses

so patients could defer payments for tests that can range

more easily allowing doctors to build a proper treatment

from MX$10,500 (US$550) to MX$150,000 (US$7,830). For

strategy for these children. Unfortunately, there are cases

example, if patients can prove their monthly income is lower

when our tests determine there is absolutely nothing to do

than MX$17,000, they can access an interest rate that is three

because the genome combination of the mother and the

times lower than the average offered by banks.

father is deadly. The situation cannot be reversed but patients do not have to suffer through unnecessary analyses like CAT

Q: How can Genetics and Health grow its participation in

scans, magnetic resonances or other, more invasive tests.

the public sector? A: Most of our revenue comes from the private sector, and the

We have mapped seven different treatments in our

high-income population segment in particular, working with

OncoPrecision Breast Care genetic panel for breast cancer

high-end hospitals. Having said that, our business model is

and based on the metabolic analysis of the patient, we can

more geared toward doctorsâ&#x20AC;&#x2122; offices. All but one of our tests

determine the correct dose and treatment that should be

require a sample of dry blood on a piece of paper to perform

administered to avoid intoxication and ensure efficacy. Our

the analysis. Doctors can do this at their office and just send

goal is to release a similar panel for prostate cancer in 2019.

the sample to us in an envelope, thus avoiding having to send a blood vial to a laboratory for proper storage and shipment. Genetics and Health is a Mexican company that provides

However, there is a massive opportunity to grow our

genetics tests to prevent, diagnose and treat diseases.

participation among the low-income population through the

The company works with leaders in the genetics area like

public sector. We have already presented a project proposal to

CENTOGENE and GENYCA

315

| ACRONYMS AI

Artificial Intelligence

AIDS

Acquired Immune Deficiency Syndrome

AMID AMIIF AMIS API AR ART

INEGI

National Institute of Statistic and

Mexican Association of Innovative

IoT

Internet of Things

Industries of Medical Devices

Intellectual Property

Mexican Association of Pharmaceutical

ISSSTE

Institute of Safety and Social Services for

Mexican Association of Insurance

JCI

Joint Commission International

Institutes

LATAM

Latin America

Active Pharmaceutical Ingredient

M&A

Merger and Acquisition

Augmented Reality

NAFTA

North American Free Trade Agreement

Anti-Retroviral Therapy

NCD

Non-Communicable Disease

ARV

Anti-Retro Virals

NOM

Mexican Official Norms

B2B

Business to Business

NSF

National Safety in Food

B2C

Business to Customer

Seguro Popular

CANACINTRA

National Chamber of the Transformation

OECD

Organization for Economic Co-operation

CANIFARMA

National Chamber of the Pharmaceutical

OTC

Over the Counter

Industry

PAHO

Pan-American Health Organization

CENSIDA

National Center for the Prevention and

PEMEX

Petróleos Mexicanos

Control of HIV / AIDS

PPP

Public-Private Partnership

CEO

Chief Executive Officer

R&D

Research and Development

CNS

Central Nervous System

Prescription Drugs

COFECE

Federal Commission of Economic

SAGARPA

Ministry of Agriculture, Livestock, Rural

COFEPRIS

Federal Commission for Protection

SALUD

Ministry of Health

Against Sanitary Risks

SEDENA

Ministry of National Defense

CONACYT

National Council for Science and

SEDESA

Ministry of Health of Mexico City

Technology

SEMAR

Ministry of the Navy

CRO

Contract Research Organization

SINGREM

National System of Medicines and Bottle

EMA

European Medicines Agency

ENSANUT

National Survey of Health and Nutrition

T1D

Type 1 Diabetes

European Union

T2D

Type 2 Diabetes

FDA

Food and Drug Administration

CPTPP

Comprehensive and Progressive Trans-

FPGC

Protection Fund against Catastrophic Expenditures

United Nations

FTA

Free-Trade Agreement

UNAM

National Autonomous University of Mexico

GMP

Good Manufacturing Practices

UNICEF

United Nations Children’s Fund

GPS

Global Positioning System

VAT

Value Added Tax

HIV

Human Immunodeficiency Virus

Virtual Reality

IMPI

Mexican Institute of Industrial Property

WHO

World Health Organization

IMSS

Mexican Institute of Social Security

WIPO

World Intellectual Property Organization

Geography

Research Industries

Federal Workers

Industry

and Development

Competition

Development, Fishing and Alimentation

Residue Management

Pacific Partnership

INDEX A-G | ACG Group 181, 183

CAPSU-GAMA 181

ACROM 180, 185

Carestream 100, 122

Additio Investment Group 295, 298

CCE 16, 20, 244

Alcon Labs 246

Centro Médico Dalinde 28

Alfasigma 55, 75

Centro Médico Puerta de Hierro 33, 225

Alternativa Médica Integral 308

CFM 21

Amazon 17, 116, 145, 148, 244, 309

CHG-Meridian México 282

Ámbar Capital 296

Chiesi 63

AMEGI 10, 82, 88

Chinoin 154

AMEPRES 232

CIATEJ 252

Amgen 55, 56, 83, 105

CIEP 84

AMID 11, 14, 116

CINVESTAV 205, 217, 312

AMIIF 16, 20, 180, 180

Clínica de Mérida 44

AMIS 11, 274, 275

Clinimed 34

AMPPI 261

COFEPRIS 10, 16, 21, 55, 69, 74, 77, 82, 84, 88, 89, 93, 124,

ANAFAM 10, 83, 84

129, 145, 150, 156, 174, 175, 176, 178, 180, 182, 184, 195, 204,

ANAFARMEX 11, 17, 83, 117, 144

232, 252, 259, 262, 263, 264, 265, 266, 268, 285, 180, 184

Anáhuac University 221, 267

CONACYT 74, 89, 217, 261, 265

ANCAM 229

Consorcio Mexicano de Hospitales 19, 27

ANVISA 93

Deloitte 54, 55, 56, 57, 116, 145, 166

APEC 241, 246, 253

DHL 206

Apolo Health 294, 295, 307

DiaSorin 126

Apopharma 69

Distribuidora Levic 192

Apotex 8, 69, 82, 87, 88, 95

Doc.com 104, 111

ARQmedyca 178

Dräger 116, 121, 219

Arroba Ingeniería 133

Dr. Vagón 117

Art-Técnica 139

DVA Mexicana 182

AstraZeneca 54, 63, 105

Ecaresoft 110

ATP 262, 268

El Crisol 205

Atramat 128, 131

EMA 69, 89, 184

Avena 303

Eolis 166

Avon 241, 251

Equipos Médicos Peninsulares 202-203

AXA 35, 36, 48, 149, 157, 281

Essity Medical Solutions Mexico 138

Balero 297, 305

ETrueba 201

Banorte 19, 35, 36, 242

Eurotrials 180

Bayer 56, 287

Farmacias Benavides 17, 83, 146-147, 161, 284

B. Braun 11, 117, 129

Farmacias del Ahorro 17, 83, 252, 284

Becerril, Coca & Becerril 261

Farmacias Especializadas Probemedic 152

Becton Dickinson 119, 124

Farmacias Purex 148

BioCenter 313

Fármacos Proasse 144, 153

Biocodex 73

FDA 16, 54, 56, 69, 82, 89, 93, 175, 184, 197

BioMarin Pharmaceuticals 66

Fujifilm 117, 123, 202, 203

Bioskinco 312

Fundación Carlos Slim 20, 311

Blue Cross Blue Shield 277

Fundación Dibujando un Mañana 310

Boehringer Ingelheim 57

FunSalud 20, 244, 244

Boston Scientific 283, 295

Galicia Abogados 260

BPF Part of QbD Group 265

Gamma Biolabs 176

Brudifarma 91

GE 202, 203

Bruluagsa 91

Gedeon Richter 74

Bupa Global 277, 281

General Health Council 14, 27, 28, 33, 42, 44, 48, 55

CAIPaDi 43

Genetics and Health 315

CANIFARMA 180, 184, 232, 244, 180, 184, 284

Getinge 127, 173

CANIPEC 240

Ginequito 32

| INDEX G-M Glenmark 82, 90

INFINITE 186

Global Health Intelligence 8, 27, 109

INMEGEN 58, 227

GMMC 196

INNN 222

GNP 19, 35, 48, 287

Instituto de Oftalmología Fundación Conde de

Goverment of Yucatan 13

Valenciana 247

Grupo Bruluart 91

Instituto Nacional de Salud para el Bienestar 38

Grupo Devlyn 241, 244

Inter-American Development Bank 284

Grupo Diagnóstico Proa 144, 155

Intersistemas 231

Grupo Marzam 193

IQVIA 10, 54, 55, 57, 82, 93, 102, 104

Grupo MDF 179

ISSSTE 27, 28, 38, 55, 83, 84, 91, 135, 137, 180, 200, 204,

Grupo México 117, 296

223, 228, 284, 180

Grupo Neolpharma 209

IVG Group 211, 314

Grupo Promass 101, 104, 108

Johnson & Johnson 54, 55, 56, 117, 132, 154, 197, 241

Grupo Rasch 167

Knaou 144, 154

Grupo RFP 149, 161

KPMG 119, 258, 269

Grupo Sicamsa 207

KRONOS 230

Grupo Torre Médica 37

Kurago 252, 295

Grupo Valore 279

Laboratorio Médico Polanco 144, 156, 158, 207

Gympass 249

Laboratorios Clínicos de Mérida 157

Hacking Health 301

Laboratorios Diagnóstica 159

Hapinss 301

Laboratorios Expanscience 240, 243

Health and Benefits 101, 104, 108

Laboratorios Hormona 88

HEB 151

Laboratorios Liomont 89

Hetero 86, 95

Lavartex 187

HMG Hospital 47

LEI 50, 77, 264

Hogan Lovells 259, 269

LG Distribuciones 204

Hospital de la Luz 245

Linet Group 137

Hospital DioMed 46

Liomont 89

Hospital Regional de Alta Especialidad de la Península

L’Oréal 250

de Yucatán 38

MAG Medical 35, 41

Hospital Sedna 45

Malvern Panalytical 171

Hospitaria 42, 296

Mapfre 35, 48, 275

Hubble Logistics 209

Mayo Clinic 33, 225

ICON 185

Mayoly Spindler 62

IDOM 284

Mead Johnson Nutrition 94

IMCO 9, 274

MedPrimex 200

IMPI 88, 263

Medtronic 197, 203

IM Natural 250

Menarini 72

IMSS 12, 13, 27, 28, 38, 55, 63, 66, 74, 83, 84, 128, 133,

Metropolitan Autonomous University 252

135, 136, 137, 156, 178, 180, 184, 185, 200, 204, 207, 221,

Mexican Society of Biomedical Engineering 226

228, 180, 180, 184

Micro Pharmaceuticals 93

INCan 9, 223, 227, 235, 241, 315

Mindray 135

INCMNSZ 43

Ministry of Economy 18, 59

Indukern 177

Ministry of Health 9, 13, 15, 27, 33, 43, 49, 74, 103, 117, 132,

INEGI 9, 83, 119, 221, 223, 275

144, 178, 179, 204, 216, 217, 222, 223, 226, 232, 267, 274,

INDEX M-Z | 284, 310, 311, 315

Salud Fácil 283

Miyabi Labs 305

Sanatorio Durango 49

Monterrey Healthcare City Cluster 18

Sandoz 83

Morpheus.Network 208

Sanfer 181, 252, 295

MSD 54, 55, 56

Sanofi 54, 55, 154, 181, 287

Multivac 197

SEDENA 55, 83

Mural Med 294, 306

SEDESA 8, 15

National Institutes of Health 43

Seguro Popular 17, 38, 66, 102, 136, 137, 178, 200, 221, 226

Novartis 10, 54, 55, 59, 154, 246

Seguros Monterrey 35, 36

Novogen 314

SELCI 170

Novo Nordisk 105

SHCP 10, 83, 84

Novostrategia 289

Siemens Healthineers 120

NYCE 266

Signufarma 105

OCASA 210

Silanes 83, 177

OECD 9, 10, 16, 83, 87, 100, 117, 120, 274, 295

Síoltalife 286

Olivares 263, 269

SiSNova 280

OMI 294, 307

SMEO 228

Ominé 106

Smith & Nephew 136

Onko Solutions 296

SOHIN 314

Ópticas de Máxima Visión 247

SOMIB 226

Pacific Prime 281

Star Médica 157

PA Consulting 233

STPS 12, 216

PEMEX 20, 55, 83

TAAP 268

Pen Healthcare 111

Tecnológico de Monterrey 33, 39, 43, 252

Pfizer 54, 55, 56, 58, 154, 181, 287

TecSalud 39

Pharmometrica 286

Teva 177

Philips 125

Trifermed 285

Plan Seguro 275, 278

UAM 15

Plan Wealth Management 274, 287

UDEM 32, 220

PLM Latina 103

UDIBI 67

Prescrypto 154, 294, 309

Ultimate Médica 248

Prevem Seguros 275, 279

UNAM 43, 89, 186, 205, 216, 235, 252, 311

Previta 107

Vaisala 168, 175

Probiomed 83

VALID 232

ProMéxico 56, 83, 84, 116, 119, 203

Valtria Engineering 174

PwC 119

Vitalmex 169

Quimialab 158

Walgreens Boots Alliance 145, 146, 147

Reckitt Benckiser 94

Walmex 144, 150, 161

Red Cross 157

WBA 147

Reinsurance Group of America 11, 274, 276

Wellmedic 300

RM Pharma 184

WHO 8, 49, 144, 166, 241, 249, 294, 305

Roche Diabetes Care 134

Willis Towers Watson 275

Roche Pharmaceuticals 54, 61, 100

Yana 294, 302

Rokk3r Labs 299

Zurich 48

Rossbach México 175

| SPOTLIGHTS 30

Wellmedic Health Centers: Medical Tourism Connecting Mexico's Specialists to the World

MAG Medical Group: Access to Healthcare Through Technology, Personalized Attention

IGSA Medical: Challenging the Status Quo in Healthcare

Chiesi: Less Invasive Tech Defeats Old Enemy

LEI: the Future of Medicine in Advanced Therapies

130

Atramat: 50 Years Suturing Quality

172

Getinge: Reinforcing High-Quality Education

198

Distribuidora Levic: Bringing Health to the Population

218

Dräger: Lung Protection and Ventilation Strategy

224

Centro Médico Puerta de Hierro: an Enduring Alliance

| INFOGRAPHICS 26

Hospitals and Care Providers

Patent Expirations Loom Over Big Pharma

Mexico's Manufacturing Companies Grow Alongside Generics

118

Medical Devices Production and Exports on the Rise

145

Pharmacy and Supermarket Opportunities to Improve Healthcare

| ROUNDTABLES 95

How are You Differentiationg Your Products in a Cost-Driven Market?

104

How is Your Company Disrupting Healthcare Practices?

161

How is Your Company Revolutionizing Medication Distribution?

235

How are You Contributing to Addressing the Need for Doctors and Specialists?

269

What are the Main Changes you Expect in the Regulatory Framework?

| ADVERTISING INDEX 6 Chiesi

126 DiaSorin

18 Signufarma

142 ANAFARMEX

147

Centro Médico Puerta de Hierro

Farmacias Benavides

34 Bioskinco

164 AMID

36 Dräger

190

Grupo Marzam Healthcare Distribution

42 Ominé

194

Pharma Tycsa

203 EMP

Arroba Ingeniería

52 Apopharma

214 INCan

226

Mayoly Spindler

Micro Pharmaceuticals México

68 LEI

238 Gympass

248

Distribuidora Levic

IM Natural

88 Hetero

256 AMIIF

Grupo Bruluart

262 Olivares

Hubble Logistics

273

Wellmedic Health Centers

292 INMEGEN

114 Atramat

Fundación Dibujando un Mañana

PHOTO CREDITS | Cover Fujifilm México

Inside Cover

96 Fujifilm

Dräger

MBP, RB, Apotex

4 Sectur

102 MBP

12 IMSS

103 MBP

104

Yucatan Government

MBP, MBP, MBP

14 AMID

105 MBP

15 MBP

106 Ominé

16 MBP

107 MBP

17 MBP

108 MBP

109

Monterrey Healthcare City Cluster

Global Health Intelligence

19 CMH

110 Ecaresoft

20 Funsalud

111

21 MBP

112 Dräger

120

Christus Muguerza

MBP, MBP Siemens Healthineers

28 MBP

121 Dräger

122 Carestream

Christus Muguerza

32 Ginequito

123

33 MBP

124 MBP

Clinimed Medical Group

125 MBP

MAG Medical Group

126 MBP

Fujifilm, Fujifilm

36 MBP

127 Getinge

128 MBP

Grupo Torre Médica

38 MBP

129 MBP

132 MBP

Hospitals TecSalud

42 MBP

133

Arroba Ingenieria

43 MBP

134

Roche Diabetes Care

Clínica de Mérida

135 Mindray

Hospital Sedna

136 MBP

47 MBP

137

48 MBP

138 MBP

49 MBP

139 MBP

50 LEI

140

Farmacias Benavides

58 Pfizer

146

Farmacias Benavides

59 Novartis

148

Farmacias Purex

62 MBP

149 MBP

63 MBP

150 Walmex

153 MBP

BioMarin Pharmaceuticals

Linet Group

67 MBP

154 Knaou

69 MBP

155

72 MBP

156 MBP

72 Liomont

157

73 Biocodex

159 MBP

74 MBP

160 HEB

75 MBP

161

78 Liomont

162 Liomont

86 MBP

166 MBP

87 Apotex

167 MBP

88 MBP

168 Vaisala

89 Liomont

169 Vitalmex

90 MBP

170 MBP

91 MBP

171

92 Liomont

174 MBP

93 MBP

175 Rossbach

94 RB

176 MBP

Grupo Diagnóstico Proa MBP, MBP

Walmex, Farmacias Benavides, MBP

Malvern Panalytical

| PHOTO CREDITS 176 Dräger

211 MBP

177 MBP

211 Liomont

178 ARQmedyca

212 INMEGen

179 MBP

216 MBP

180

217 MBP

Eurotrials, a CTI Company

181 MBP

220 UDEM

182

DVA Mexicana

221 MBP

182

Novo Nordisk

222 MBP

183

ACG Group

223 MBP

184

RM Pharma

226 SOMIB

185 ICON

227 INMEGEN

186 MBP

229 MBP

187 MBP

230 INMEGEN

188 Liomont

231 MBP

192

232 MBP

Distribuidora Levic

193 Marzam

233

195 Pharmatycsa

233 MBP

196 MBP

234

Hospital Regional de Alta Especialidad

197

235

MBP, MBP, MBP

Multivac, MBP

PA Consulting

200 MBP

236 HEB

201 MBP

242 MBP

202

243 MBP

Equipos Médicos Peninsulares

204 MBP

244 MBP

205 MBP

245 MBP

206 DHL

246 Alcon

207 MBP

247

208 Morpheus.Network

Instituto de Oftalmología Fundación Conde de Valenciana

209 MBP

248

210 OCASA

249 Gympass

Ultimate Médica

PHOTO CREDITS | 250 MBP

287 MBP

251 Avon

288 3M

252 MBP

289 Novostrategia

252 HEB

290 Hapinss

254 MBP

296

258

KPMG, KPMG

297 MBP

259

MBP, MBP

298

Additio Investment Group & Industry Advisor

260

Galicia Abogados, Galicia Abogados

299

Rokk3r Labs

261

MBP, MBP

300

Wellmedic Health Centers

262 MBP

301

MBP, Hacking Health

263 MBP

302 MBP

264 LEI

303 MBP

265 MBP

304 Liomont

266 MBP

305 MBP

267 MBP

306

Mural Med

268 MBP

307

Apolo Health

269

307 OMI

MBP, MBP, KPMG

Ámbar Capital

270 Hospitaria

308 MBP

276

309 MBP

Reinsurance Group of America

277 MBP

310

Fundación Dibujando un Mañana

278 MBP

311

Fundación Carlos Slim

279 MBP

312

Bioskinco, Bioskinco

280 SiSNova

313 BioCenter

281 MBP

314 MBP

282 MBP

315

283 MBP

Inside Back Cover Novo Nordisk

284 IDOM 285 MBP 286 Sioltalife

Genetics and Health

| CREDITS JOURNALIST & INDUSTRY ANALYST: Alessa Flores JUNIOR JOURNALIST & INDUSTRY ANALYST: Jan Hogewoning SENIOR WRITER: Alicia Arizpe EDITORIAL MANAGER: Daniel González SENIOR EDITORIAL MANAGER: Alejandro Salas EDITOR: Ricardo Guzmán López SENIOR EDITOR: Mario Di Simine PUBLICATION COORDINATOR: Samantha Bonomo PUBLICATION MANAGER: Jorge Naupari COMMERCIAL MANAGER: Bruna Brandão COMMERCIAL DIRECTOR: Jack Miller JUNIOR GRAPHIC DESIGNER: Tania Aguiñiga JUNIOR GRAPHIC DESIGNER: Marcela Muñoz SENIOR GRAPHIC DESIGNER: Ailette Córdova SENIOR GRAPHIC DESIGNER: Mónica López DESIGN DIRECTOR: Marcos González WEB DEVELOPMENT: Omar Sánchez COLLABORATOR: Gabriela Mastache COLLABORATOR: Brenda Salas CIRCULATION MANAGER: Constanza Blanco DIRECTOR GENERAL: Jeroen Posma

| PRINTED BY Litoprocess S.A. de C.V. Av. San Francisco Cuautlalpan 102a, San Francisco Cuautlalpan, 53569 Naucalpan de Juárez, Méx.

$199.00 ISBN 978-1-7328256-4-2

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Mexico Health Review 2019

Articles inside

A TECH PLATFORM TO DEMOCRATIZE HEALTHCARE

UNIVERSITY ALLIANCES STRENGTHEN MEXICAN HEALTHCARE

EFFECTIVE COMMUNICATION IMPROVES EFFICIENCY IN OPERATING ROOMS

MEDICAL RECORDS ARE PATH TO SECTOR OPTIMIZATION

BASIC RESEARCH A PILLAR FOR HEALTHCARE

MEXICO GATEWAY FOR LATIN AMERICA EXPANSION

R&D LEADS TO SUSTAINED, INCLUSIVE GROWTH

BETTER DIALOGUE NECESSARY TO IMPROVE ACCESS TO MEDICAL DEVICES

RESEARCH THE BASIS OF PREVENTION, PROPER HEALTHCARE

OUT WITH THE OLD, IN WITH THE NEW