Fernando Becerril Orta
Senior Partner
Becerril, Coca & Becerril – BC&B
/
Expert Contributor

Innovative Medicines, Medical Devices Must Overcome to Thrive

By Fernando Becerril | Fri, 03/26/2021 - 12:39

One year ago, at least in Mexico, the first case of SARS-CoV-2 was detected and marked the start of the pandemic in our country. The health contingency took us by surprise and forced us to carry out significant modifications in our lives.

Twelve months ago, we all started dealing with what became known as “the new normality” and as months passed, we were all trying to re-gain our regular activities. Certainly, the second and third quarters of 2020 were very difficult since almost all non-essential activities were locked down, including government activities. By the second half of the year, it became essential to reactivate economy. From there, and despite the health contingency, most of those segments not considered essential activities were resumed to a nearly normal point. With this, the economy has been growing toward the levels of the previous years.

The vaccination campaign against the COVID-19 disease has already been launched. In Mexico, we will have to wait for the availability and the application of vaccines for most of the population before being able to take the risk of venturing a possible reactivation date for activity in full.  But, even with the start of the vaccination campaign, it appears that the forecast for this health contingency is not at all flattering. Some data suggest that the health contingency, and consequently the confinement (which is becoming less strict on a daily basis), will extend at least until the second quarter of 2021. Eventually, by 2022 we will be able to really resume (with all health measures) our old normal lives. The only certainty is that depending on the speed of the vaccination process, we will reach the time in which we can resume our activities in a way that, to some extent, is comparable to our old normality.

Besides the health situation and the economic forecast for the national economy, there are also some legal and regulatory issues in the health sector that have had an impact in the last year. During the last 12 months, several laws have been passed in the Mexican Congress and have come into force, but regulations for their implementation are, in some cases, still pending. What is true at the present time is that there are many pending legal issues to be clarified from a regulatory point of view.

One of the most polemic and interesting initiatives, which has been in the spotlight for some years now in Mexico, is that related to the regulation of cannabis for medical use. While there has been legislation in this regard since 2017, the regulations were just issued, in January 2021. These regulations are focused on the medical use of cannabis from research and production up to importation and exportation of cannabis products and derivates for medical use. Given that, there are still many additional tasks that must be focused on in order not to over-regulate other important economic sectors in the industries of cannabis and related products. It is expected that cannabis-related pharmaceutical products will become a significant part of the pharmaceutical industry in the coming years. Therefore, it is time for local and foreign companies to start implementing their strategies, either financial, R&D and/or commercial, to become relevant participants in this market.

Another relevant and challenging issue that is controversial is that related to public tenders for medicament acquisitions. In 2019, the Mexican government, through the Ministry of Finance and Public Credit, established a system for consolidated purchases of medicines. That was a big step forward, but unfortunately the reality is that about 40 percent of the tenders during the last months of 2020 were declared void. There have been many questions regarding the way in which the federal government has been handling all issues related to bids and direct acquisition awards. From the point of view of many of the regular actors in these types of activities, there is no clarity in the tender processes and, although the system for consolidated purchases exists, it has not been properly implemented. This failure in the correct implementation of the system not only affects the pharmaceutical companies because of the tenders per se, but unfortunately, it also affects the accessibility of the national health system to necessary medicines, medical supplies and adequate equipment. This situation has definitely put the country in a complex position. The fact is that the issue will continue to be discussed in the following months with the highest authorities in the health and finance agencies because of the great impact that a bad implementation or an incorrect decision have on the entire national health system, and the impact of these actions over the longer term. It is expected that negotiations could lead to a favorable agreement in which all parts make an effort to supply medicines, devices and, in general, all products that are demanded by the national health ecosystem for the benefit of the Mexican people in the public health system.

Another challenging issue, mainly for innovative medicines, relates to generic drugs. On July 1, 2020, the new Federal Law for the Protection of Industrial Property was approved and entered into force on Nov. 5. The new law, additionally to a clear definition of the well-known linkage system, includes an exception equivalent to the so-called Bolar exemption that allows the use, importation and commercialization of pharmaceutical products for experimental purposes. It is clear that the idea of this inclusion is to make it easier for producers of generic drugs to develop their own products so they can go on sale as of the day after the expiration date of the related patent or patents that cover the innovative products, with the purpose of providing people with access to those low-cost pharmaceutical products in a shorter time. 

For medical devices, things are not really very different from the scenario for medicines. The actual health contingency demanded a substantial increase in production of medical devices from local and foreign manufacturers, which companies were not ready to meet. More than regulation and protection issues, the real challenge for innovative medical devices is to prepare the actual infrastructure to be able to meet market requirements and to continue with this interesting trend of research and development (R&D) in the specific area of technology.  Hundreds of new innovative devices, from the very basic to the highly sophisticated, have been released in recent months. This seems to be just the tip of the iceberg.

This recent pandemic has made clear to us, more than never, that the most valuable thing we have is health. That is why 7.2 billion people in the world and 126 million in our country are looking forward to having access to more medicines, medical devices and products that guarantee that they will be able to resume their lives.

More now than ever before, the awareness of the importance of personal care has taken on greater relevance. Therefore, the future for these kinds of innovative products is promising. It is important that the business conditions are in place so that, far from becoming a problem, they are executed in the most appropriate way in terms of quality, cost and time to generate a real benefit to all the parties involved. There are many challenges to come, but there are even opportunities.