Mexico has the second largest pharmaceutical market in Latin America and ranks 12th globally. As an important producer of medicines, including antibiotics, anti-inflammatories, and cancer treatments among others, Mexico is projected to reach over USD $13 billion in pharmaceutical sales by 2028. Since 2000, the Mexican healthcare system has evolved with patients being granted improved access to oncology treatments and the widespread availability of generic drugs, all of which has led to increased growth of the country’s pharmaceutical industry.
More than 128 million Mexican citizens receive their health insurance and prescription drug coverage via two public systems and the private sector. Although an estimated 90 percent of the population is covered for a core set of health services, out-of-pocket payments remain high at a little over 40 percent of the country’s total health expenditure.
The divisions within the healthcare system mirror economic divisions in Mexico. The wealthy and upper-middle class have private insurance and utilize private healthcare providers. Middle- and lower-income Mexican citizens use one of the two public-sector insurance programs. Success in the Mexican market requires an access and communications strategy with the flexibility to achieve reimbursement in all three market segments.
Mexico’s Payer Stakeholders
In Mexico’s public health system, the federal and state governments are the main payers. Government-sponsored health insurance systems include the Instituto Mexicano de Seguridad Social (IMSS), and the newly implemented Insituto de Salud para el Bienestar (INSABI). The health service for State workers is the Institute of Social Security at the State Workers Service (Instituto de Seguridad Social al Servicio de los Trabajadores del Estado, ISSSTE). The middle class in the formal economy primarily uses the publicly funded IMSS and other government-run systems. INSABI, which replaced Mexico’s “Seguro Popular” system in January 2020, offers social security to individuals outside IMSS’ and ISSSTE’s coverage, which accounts for approximately 69 million Mexicans.
Members of the armed forces have their own health services, including Secretary of the National Defense (Secreatría de la Defensa Nacional, SEDENA) for the army, and Navy Secretary (Secretaría de Marina, SEMAR) for the navy.
The private sector includes independently operated health plans and hospitals like in the United States. Major private-sector providers in Mexico include GNP, AXA, Metlife and Seguros Interacciones. As such, employers and the individual make up the dominant payers for private insurance.
Important Points to Keep in Mind
The Federal Health-Risk Protection Commission (Comisión Federal para la Protección contra Riesgos Sanitarios, COFEPRIS) is the government regulatory authority responsible for approving new medicines in Mexico. Once products are approved, the General Health Counsel (Consejo de Salubridad General, CSG) is the main decision maker body for new medicines’ inclusion on the public drug formularies, called the Health Systems Supply Catalogue (Cuadro Básico y Catálogo de Insumos del Sector Salud).
The process for making a drug available in the public health system is as follows:
- Secure regulatory approval from COFEPRIS
- Petition for inclusion in the Health Systems Supply Catalogue
- Once listed, the drug may be prescribed by any doctor within the public health system
In the case where a drug is not approved for general use, a demonstration of immediate need can be submitted to a Ministry of Health committee for special approval on a case-by-case basis.
Once drugs have been added to the Social Health Services Register, pricing is determined by institutional agreement between the manufacturers and payers. A drug’s value and price in the private system is determined by the market and in the public sector via public tender and subsequent negotiations. Though COFEPRIS sets the maximum price limits on drugs and procedures, the shelf price of a drug under this limit is ultimately left up to the manufacturer.
For delivery of medical services, including prescription drugs, those covered under the public health system are limited to attending (and receiving prescriptions from) federal- and state-run hospitals. Federal hospitals accept all forms of insurance, public and private, but private clinics only extend benefits, including medications, to those who have private insurance (or if that person can pay out-of-pocket).
In mid-2020, the federal government signed an agreement with the United Nations Office for Project Services (UNOPS) to collaborate on the international purchase of medicines, medical supplies and vaccines. This has enabled Mexico to join the Regional Revolving Fund for Strategic Public Health Supplies of the Pan-American Health Organization (Fondo Rotatorio Regional para Suministros Estratégicos de Salud Pública de la Organización Panamericana de la Salud). Further, on July 30, 2020, President López Obrador announced that a state company would be created to distribute these internationally purchased medicines across Mexico, especially throughout more remote and isolated areas of the country.
Implications for Industry
Overall, access into the Mexican healthcare market is largely dependent on demonstrated value. Private payers make decisions based on the value of a medication to patients’ health, and public health systems choose to include medication in their catalogue based on the value to the population. With a growing population and a health system dedicated to increasing its ability to provide access to healthcare, telling your value story is more important than ever. GLOBALHealthPR’s Mexico office has nearly 20 years of successfully creating and communicating the value story to diverse audiences.
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