Diego Cevallos
MEXICO CITY, Aug 13 2008 (IPS) – Mexico s pharmaceutical industry, which thanks to laws that have been labelled protectionist has grown into the most powerful in Latin America, warns that the unrestricted importation of medicines decided by the government will expose the public to a possible health catastrophe.
For decades any laboratory that sold drugs in Mexico had to have a manufacturing plant in this country, under an Economy Ministry requirement.
But an Aug. 5 decision by the conservative government of Felipe Calderón to waive that requirement will bring unforeseeable negative consequences and will endanger 40,000 direct and 200,000 indirect jobs, the Mexican Pharmaceutical Association complained in a statement issued Wednesday.
The requirement that laboratories had to have plants in Mexico if they wished to sell their medications here stimulated the growth of a strong pharmaceutical industry based on both local and foreign capital.
Sales of pharmaceutical products currently amount to nine billion dollars a year in Mexico, making this the biggest market in Latin America.
A total of 224 laboratories belonging to 200 companies 46 of which are predominantly foreign-owned firms operate in this country of 104 million people.
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At the time, the requirement of a plant in Mexico was an incentive to get pharmaceutical companies to invest in this country. They were protected, and no one else could compete, but that had to come to an end sooner or later, Héctor Bolaños, president of the Asociación de Fabricantes de Medicamentos de Libre Acceso (Mexico s over-the-counter pharmaceuticals trade association, AFAMELA), told IPS.
The Calderón administration struck down the requirement because local laboratories have been selling medications at higher prices than they fetch in other countries, due to the lack of competition.
For example, the cost of antiretroviral drugs, which extend the lives of people living with HIV, is two to three times higher than the average cost in other developing nations.
The requirement for a local plant was part of another era. With globalisation and the growing openness of markets, it had to come to an end. Now the challenge is for the authorities to ensure quality control of imported medicines, said Bolaños.
The Mexican Pharmaceutical Association maintains that the indiscriminate importation of medicines from anywhere in the world will overrun the Health Ministry s oversight and quality control capacity, which means dangerous medications could be imported and could cause a health catastrophe.
The pharmaceutical companies urged the government to reinstate the local plant requirement. They also said the opening up of the industry puts the jobs of their employees, who receive wages and benefits that far surpass national standards, at risk.
Miguel Toscano, the head of the Federal Commission for Protection against Health Risks, in charge of overseeing the quality of pharmaceutical products, said the requirement for a local plant would be waived for two years, during which time the Commission would significantly improve its oversight capacity.
Thanks to this measure, he said, consumers will be able to buy drugs that now cost between 30 and 40 dollars for less than six dollars.
Toscano said that virtually no country in the world has a law anymore requiring that companies open a local manufacturing plant in order to gain access to the market.
The change introduced by the government indicates that the health permits issued by the country of origin must be presented when medicines are imported. Toscano also said Mexican authorities would make periodic visits to the plants where the drugs are produced abroad.
Low-cost, high-quality generic drugs will arrive from India and Israel in the near future, said the official.
The new regulations establish that free importation, with the necessary prior authorisation, has been in effect since Aug. 5 in the case of generic antiretroviral drugs.
It will also be put in place in six months for vitamins, vaccines, blood products, hormonal products, and homeopathic and herbal remedies, in 12 months for biotechnological and biological medications, in 18 months for narcotics and psychotropic medications, and in two years for all other drugs.
Unlike some of our colleagues in the industry, we believe that the pharmaceutical firms operating in Mexico are in a position to compete and even to export, and that the opening up of the market should be seen as a new opportunity, said Bolaños.
Médecins Sans Frontières recommends avoiding restrictions on imports of generic drugs, in order to keep prices down.
But Ricardo Romay, president of the Mexican Association of Pharmaceutical Laboratories, which groups 59 local companies, warns that the measure endangers public health security, without any evidence that it will have the intended result.
In his view, there is no evidence at all that proves that this will lead to a reduction in prices.
Mexico is an attractive market for the pharmaceutical industry, because of the characteristics of the population. People older than 65 made up four percent of the population in 1970 a proportion that will have risen to 15 percent by 2025, while life expectancy will have risen by then to 81.6 years for women and 76.8 years for men.
The pharmaceutical companies know that on average, older people consume more medication and rely more heavily on health services.
