Fernando Becerril Orta
Senior Partner
Becerril, Coca & Becerril
/
Expert Contributor

The Upcoming Challenges in the Healthcare Industry

By Fernando Becerril | Mon, 11/22/2021 - 13:46

As a result of the serious health contingency that we have experienced in recent months, we are living in a time when health is an essential concern for society from various points of view. Every day, we are involved in discussions and situations where issues such as food and physical activity, access to the health system and infrastructure remind us that society is increasingly aware of the need for better health conditions.

To achieve a better health condition in this current society, it is essential to refer to the intense processes of innovation in industries related to health sciences, which achieve significant advances in various areas of knowledge that now allow us to have better devices, therapeutic and diagnostic methods and, of course, more efficient and effective medicines, as well as substantial improvements in the quality of food and, in general, consumer products related to health. This effort responds to the urgent social need to improve people's quality of life.

In the pharmaceutical field, we are well aware that the development process of a new drug is long and expensive, as it involves the interdisciplinary participation of a large number of professionals, as well as high-tech research and production teams. It is public knowledge that for each line of research, the pharmaceutical industry invests several hundred million dollars and that commercial results are obtained in only three out of 10 lines of research.

To make this effort profitable in every way, industry makes use of intellectual property to protect these developments and, for a limited period, can market the products on an exclusive basis to recover the investment. This legal tool makes it possible to maintain an adequate balance in the system from the innovation process of the industry to the end consumer. It must be recognized that there is a perception among consumers that the cost of drugs is high and that the patent protection period is too long; however, it is very important to take into account that, to achieve this balance, it is necessary for those who invest time, money and effort in innovation to obtain a return on their investments and thus be able to continue with the innovation cycle.  If protection times were shorter, costs would be higher and if the costs were lower, protection times would have to be much longer and perhaps not as effective. If there were not an adequate return on the investment, the resources for new research projects and new drugs would be less and less and thus, directly, there would be a deterioration in both the quantity and the quality of these drugs, with a substantial impact on public health.

Although it can, of course, be improved, the system is functional and almost virtuous. Industry invests, researches, and generates products that the states protect, and which are granted adequate time to recover the investment made. Once the term has expired, the product is viable for marketing by some other agent in the industry, thereby reducing the cost of the product. At the same time, the industry continues to develop new lines of research and products to maintain the cycle of technological innovation in the sector, which has allowed the development over the last 50 years, almost exponentially, of a large number of drugs with high levels of specialization.

The pharmaceutical sector has a close relationship with public health but also with the economies of countries. To that extent, this industry generates polarization in societies at a global level, since on the one hand it has a direct influence on the population health via access to medicines, and on the other hand, it has a specific weight in the economies due to the significant economic flow it generates.

At present, the industry in Mexico seems to be going through somewhat turbulent times. While it is true that in the last three years the legal environment has become more defined, it is also true that internally, the political and regulatory situation has put large investors in this sector in our country on alert.

Just a year ago, a totally new Law for the Protection of Industrial Property entered into force, which to a great extent updates our legal system to international standards and, thus, complies with the commitments established by our country in various treaties to which it is a party. To be able to say that we have fully complied with the commitment, we still need to issue the corresponding regulations, which will clarify some points that, even though they are established in the law, we do not know clearly how they will be implemented.

The signing and ratification of the USMCA by the US, Canada and Mexico put on the table issues that are particularly relevant in legal and commercial matters related to intellectual property. As we know, the protection of intellectual property rights of the holders of patents, industrial designs, trademarks and copyrights, among others, has a direct effect on the way in which trade relations are conducted between these three countries. Among the industrial sectors having greater fields of action and influence is, of course, the pharmaceutical industry.

A relevant issue is the linkage system that is currently in place between the Federal Commission for the Protection of Sanitary Risks (COFEPRIS) and the Mexican Institute of Industrial Property (IMPI). This system establishes the rules of collaboration between IMPI and COFEPRIS to prevent the granting of sanitary registrations to persons who request them for the commercialization of active ingredients that have a valid patent term and of which these persons are not the holders. While it is fair to say that the system has worked well since its original implementation, the modernization of the linkage system will now take on greater importance as it will open up possibilities of competition for both innovative and generic producers in the field of medicine.

In these times of transition in both domestic and foreign policy, it is important to keep an eye on Mexico’s position in the international arena and, at the same time, to follow up on the changes that are taking place in the national scenario in the different legislative and regulatory processes.

Today, industry is going through a time that it has not experienced in at least 30 years and, therefore, it is important to closely monitor situations that may affect the current balance. The important factor, of course, is to find the middle ground in which the industry, state and consumer each plays its corresponding role, understanding that the most important focus needs to be on society’s health. For this, we need to continue developing medicines, technologies and processes that allow us to combat the diseases that afflict this modern society and that, as we have already said, always appear in our daily conversations.

Photo by:   Fernando Becerril