Healthcare Resource Guide: Mexico

Mexico Statistics


Summary

Healthcare Policy Issues

Market Entry

Current Market Trends

Main Competitors

Current Demand

Registration Process

Reimbursement

Barriers

Trade Events

CS Contacts

Best Prospects

Market Size

Capital: Ciudad de Mexico

Population: 125 million (2017 estimate)

GDP: US$ 1.1 trillion in 2017

Currency: Mexican peso

Language: Spanish

Summary

Mexico’s healthcare system is structured to offer universal healthcare to its citizens and residents, principally through three public health agencies that provide health insurance and that each operate their own network of healthcare facilities. The Mexican Social Security Institute (IMSS) covers most employed individuals and their families, the Institute for Social Security and Services for State Workers (ISSSTE) covers public sector employees, and Seguro Popular covers individuals and their families who are unemployed. Opportunities exist across the sector, but particularly for medical devices, equipment, and products.

Mexico’s market for medical equipment, instruments, disposable and dental products has fluctuated significantly in recent years in the mix of local production, exports, and imports. Imports of these products totaled nearly USD 5.4 billion in 2017 after a large spike of third world country imports in 2015. This represented about 70% of the medical equipment and instrument market and approximately 40% of medical disposable products and dental materials used in Mexico. About 68% of the total import market, or USD 3.6 billion of imports, came from the United States in 2017. This amount represented a significant drop in imports from the United States in 2017, but it followed a massive surge in imports from the United States from 2015 to 2016. The spikes we have seen in recent years may be due not only to one-time purchases by the government healthcare system but also to construction of several new hospitals in both the public and private healthcare networks.

The main third country suppliers of medical devices are Brazil, Canada, China, France, Germany, Israel, Italy, Japan, the Netherlands, South Korea, and the United Kingdom. A growing competitive problem for U.S. suppliers is low-cost and frequently lower-quality supply from Asian sources, particularly China.

However, medical products from the U.S. are highly regarded in Mexico due to high quality, after-sales service, and pricing, compared to competing products of similar quality. Consequently, U.S. medical equipment and instruments have a competitive advantage and are in high demand in Mexico.

Mexico has also increased the domestic manufacturing levels of a variety of medical devices, mainly from international corporations that have established in-bond plants in Mexican border regions and other sites in the country. This resulted in Mexico increasing exports of medical devices 1.5% from USD 11.4 billion in 2016 to USD 11.6 billion in 2017. Most of this production and exportation is of simple products, but manufacturing of sophisticated medical devices such as pacemakers and cardiac valves is emerging.

The Mexican government is trying to establish new policies to improve the population’s health. These include expanding the coverage of the public healthcare institutions and trying to standardize the services offered by all of them. They are also implementing new programs to prevent the increase in incidences of diabetes, obesity, and chronic diseases such as hypertension, cardiac diseases and chronic respiratory diseases.

The private sector is increasingly being allowed to offer solutions like integrated surgery services and integrated management of patients with certain diseases, such as diabetes. There has also been a long-discussed government policy change for assigning patients to hospitals and clinics that did not move any closer to implementation in 2018. Facilities and their patients are currently segmented by which public medical network owns the clinic. The idea is to improve use of available infrastructure by assigning a patient’s care to the closest hospital or clinic, regardless of the patient’s affiliation with IMSS, ISSSTE, or Seguro Popular.

Healthcare Policy Issues

The Federal Commission for Protection against Health Risks, COFEPRIS, regulates health products in Mexico, and was recognized by the World Health Organization (“WHO”) as a National Regulatory Authority of Regional Reference (“NRARR”) following a positive evaluation of the agency’s performance. COFEPRIS has striven to improve the regulatory environment in Mexico to support faster market access for innovative medical devices. Streamlined processes are advantageous for patients, who benefit from increasing market competition and greater access to innovative technologies. The Mexican government estimates that nearly one million people use the public healthcare system each day, highlighting the significance of regulatory development in both public and private systems. By reducing bureaucracy and increasing transparency, COFEPRIS will improve the regulatory environment and will also enhance access to the second largest medical device market in Latin America.

Market Entry

All medical equipment and devices can be imported duty free with a NAFTA certificate of origin. Imports are subject to a 16% VAT tax over the invoice value.

All medical and healthcare products that touch or affect the human body need to be registered with the Mexican Secretariat of Health (SSA) prior to sale or use in Mexico. Foreign manufactures of medical devices need to have a legally appointed

distributor/representative in Mexico who will be in charge of obtaining the sanitary registration/market approval and will be the responsible for the product(s) in Mexico. U.S. Commercial Service Mexico can provide a detailed list of requirements and advice for processing market approval in Mexico for U.S. medical devices.

Current Market Trends

Most large public and private hospitals try to have modern and specialized medical devices. Some medium and small private hospitals with limited budgets buy used or refurbished equipment. Public hospitals, by law, cannot buy used or refurbished products. To save resources, many public and private hospitals are hiring companies that offer “integrated surgery services” and provide service “per event,” offering all the necessary products required to perform a surgery. This concept has been expanded to other areas where hospitals can use integrated suppliers for different processes such as sterilization, hemodialysis, and radiation treatment. In this way, hospitals avoid making large investments in materials, pharmaceuticals, and instruments. They also reduce the costs involved in keeping and controlling inventories, and maintaining instruments for specialized surgeries.

All public institutions ask suppliers to register with their organization. These institutions may award purchases under USD 3,100 directly to a selected provider. Purchases over that amount must be done through public tenders.

All private healthcare facilities select suppliers by requesting price quotations. Their decisions are based on the best equipment at the best price.

Main Competitors

Most large international corporations offering medical devices have a presence in Mexico. Medium and small foreign suppliers usually sell through legally appointed distributors.

Current Demand

The three public healthcare institutions account for 70 to 80% of total medical services provided nationwide, while private healthcare institutions cover approximately 25 to 30% of the Mexican population, including 32 million people with private medical and accident insurance. Some patients covered under government social security plans also have private medical insurance.

In the public sector there are 22,831 outpatient healthcare units and 1,386 hospitals, of which 195 are highly specialized medical hospitals. In the private sector, of the 2,960 hospitals, only about 100 have more than 50 beds and offer highly specialized medicine. Most of the hospitals offering specialty healthcare services are in medium and large Mexican cities. There are also some medium-sized private hospitals that offer specialty services and focus on high income, insured patients.

Imports supply about 80% of medical equipment and instruments and about 40% of medical disposable and dental products. In 2017, total imports in these four groups of products reached USD 5.4 billion. Of these imports 68.7%, or USD 3.6 billion, were of U.S. origin. Main competitors are from Belgium, Brazil, Canada, China, France, Germany, Israel, Italy, Japan, Netherlands, South Korea and UK.

Registration Process

Mexico has a fast-track process for the sanitary approval of U.S. FDA-approved medical devices and pharmaceuticals, which helps expedite imports from the U.S. For the market authorization of other products, the Mexican sanitary agency Federal Commission for the Protection against Sanitary Risk (COFEPRIS) has made considerable advances in clarifying requirements and approval timelines in recent years. COFEPRIS has worked closely with the industry to deregulate products that do not present risk for patients. On December 22, 2014, COFEPRIS published an agreement containing a list of 2,242 products that are no longer considered medical devices and that now do not require sanitary registration/market approval in Mexico and can be freely imported. As of mid-2018, efforts have been undertaken to update the list, but a timing for its release has not been announced. COFEPRIS is also analyzing other ways to expedite the sanitary registration of FDA approved medical devices.

Reimbursement

Mexico does not have a reimbursement system like the one in the United States. Public healthcare institutions purchase the products for their services in quarterly or annual quantities in advance and do not charge patients per product or event. Patients receive all the products included for their care with no charge.

Reimbursement for care only exists for patients with private healthcare insurance coverage. However, there is not a general reimbursement policy for all insurance companies. Each company determines prices and reimbursement according to its own policy.

Barriers

Besides the sanitary registration, some medical products need to comply with technical standards or NOMs (Norma Oficial Mexicana). All standards are classified based on the Harmonized System Code (HS).

There are few Mexican standards for medical devices, but various agencies are involved in standards development. Updated information on NOMs, other sanitary processes, and the registration and approval of medical devices can be found on the web page of COFEPRIS: https://www.gob.mx/cofepris/

Challenges remain for many U.S. companies in achieving formulary listings for the many health coverage providers in Mexico. There are also limitations on U.S. companies competing with domestic manufacturers in public hospital tenders, thus giving preference to domestic Mexican products. For instance, Mexico introduced a limitation in 2008 which applies to value-added content requirements under Free Trade Agreements as a condition for non-Mexican-based manufacturers to participate in bids. In recent years, some companies have been able to side-step this requirement by working with local suppliers who provide the equipment in tandem with local services to which these same content requirements are not applied.

COFEPRIS has sped up its drug approval process in recent years through fast-track procedures for products already approved in jurisdictions such as the United States. However, pharmaceutical companies complain about intellectual property uncertainty, partly due to shortcomings in IP protection of drug patents, partly due to timings in the patent and renewal process that can enable generic producers to develop a competing drug, and partly due to weak interdiction of counterfeit drugs. Of particular concern to biologics producers is that patent data protections do not explicitly recognize biologics. The process for seeking injunctions and damages in patent disputes also remains onerous and difficult for innovative companies in Mexico.

Mexico gives preference to participation in public tenders covered by Free Trade Agreements (FTAs) to Mexican bidders and foreign bidders from countries with which Mexico has an FTA. To take advantage of this market access, some Mexican procuring entities require that suppliers provide a declaration either that their goods qualify as originating in Mexico or from a country with which Mexico has an FTA, according to the rules of origin of the FTA. At least one U.S. company found it challenging to meet this requirement because of its global sourcing. However, this results in a benefit for companies that comply with the 51% of U.S. origin required to get the NAFTA certificate of origin. Thanks in part to this Mexican policy, 68% of the medical devices imported into Mexico in 2017 were of U.S. origin.

Procurement & Tenders

The Mexican federal government uses an online procurement information management tool called CompraNet (https://compranet.funcionpublica.gob.mx/web/login.html), similar to the United States FedBizOpps system. CompraNet is a repository for all official tender information and documents by all bidders, and is managed with oversight by Mexico’s Secretariat of Public Administration (Secretaría de la Función Pública, or SFP).

U.S. firms are encouraged to carefully analyze tender specifications. They may differ from entity to entity and vary based on the value of the purchase, type of goods or services, budget limitations, regulatory requirements, and other concerns. A bid will be disqualified if not received within the specified period of time. Stipulated bids can also be disqualified for not meeting technical details, even items as small as a discrepancy in a comma between a bidder’s corporate name and its certifications. Likewise, each tender includes a specific

period for participants to ask questions. By paying attention to all the details, firms can avoid unnecessary disqualifications during the tender process. In some tenders, only written questions are permitted. Replies are given to all purchasers of the tender documents.

If a tender specifies a certain brand or gives preference to a supplier, a complaint can be filed with the Directorate-General of Complaints (Dirección General de Quejas) at the procuring agency before the contract is awarded. Each bid should only consider the exact specifications listed in the tender. "Additional solutions" and/or specifications not listed can disqualify the bid.

Finally, U.S. firms should communicate regularly with their Mexican representative and fine-tune all details related to the required documents. There have been numerous cases of disqualification based upon seemingly insignificant failures on the part of bidders to comply with tender regulations and procedures to the letter of the law.

Trade Events

The most relevant medical events in Mexico are:

Expomed, June 2019

Mexico City

www.expomed.com.mx

AMIC Dental, November 14-18, 2018

May 2019, Mexico City

www.amicdental.com.mx

Expo DICLAB (Clinical & scientific laboratory products) September 26-27, 2018,

Mexico City

www.expodiclab.com.mx

Expo Farma, April 3-5, 2019

Mexico City

www.expofarma.com.mx

There are also important events organized by medical academies and associations that could be excellent for companies offering high technology medical devices, as they are focused on very specialized niche sub-sectors.

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Useful Links

For public institutions

www.cofepris.gob.mx

www.salud.gob.mx

www.imss.gob.mx

www.issste.gob.mx

www.cenetec.salud.gob.mx

For private hospitals

http://www.gass.com.mx

www.starmedica.com.mx

www.hsj.com.mx

https://www.abchospital.com/

www.hespanol.com.mx

www.amerimedcancun.com

www.christusmuguerza.com.mx

www.medicasur.com.mx

www.hospitalsanangelinn.mx

FAQs

1. What additional market research is available?

a. Labeling for Medical Devices. February 2010

b. Health IT Market Overview, March 2012

c. Sanitary Registration U.S. Medical Devices 2017, November 2017

2. Which medical devices need to be registered with the Secretariat of Health (SSA)?

All medical and health care products that will touch or affect the human body need to be registered with the Mexican Agency in charge of controlling medical products (COFEPRIS) prior to sale or use in Mexico.

For this purpose the General Law of Health defines the following categories:

a. Medical equipment: Apparatus, accessories and instruments for a specific use dedicated to provide medical or surgical attention, or for use in patient examination, diagnosis, treatment and rehabilitation, as well as those used for conducting biomedical research activities.

b. Prosthesis, orthosis and functional aids: Devices intended for replacing or supplementing a human body function, organ or tissue.

c. Diagnostic Agents: All supplies including antigens, antibodies, calibrators, controls or verifiers, reagents, reagent kits, culture media, contrast media and any other substance that is used as ancillary of other clinical or paraclinical procedures.

d. Dental Supplies: Any substance or material used in providing dental-health attention.

e. Surgical Materials and Medical supplies: Any device or material that, regardless of being supplemented with antiseptics or germicide agents, are used in the surgical practice or in the treatment of skin injuries, or other health care procedures and,

f. Hygiene Products: Materials and substances that are applied onto the skin or body cavities which have pharmacological or preventive action.”

3. May I register my product directly with the COFEPRIS?

No. Foreign manufactures of medical devices need to have a legally appointed distributor/representative in Mexico responsible for the registration process and product in Mexico. Distributors/representatives must be authorized to sell/distribute medical devices and employ a professional (physician, chemical engineer, biomedical engineer, etc) responsible for the medical devices offered. Some consulting firms also offer to be the registration holder for foreign medical device manufacturers. However, they usually do not perform any sale or promotional activity to introduce products into the market. If a company wants to register products directly, it must open a branch in Mexico. For more information on this process, please contact a local law firm.

U.S. Commercial Service Contact Information

Name: Alicia Herrera

Position: Senior Commercial Specialist

Email: alicia.herrera@trade.gov

Phone: (011-52-55) 5080-2000 ext. 5215

Best prospects

  • Diagnostic equipment
  • Respiratory care equipment
  • Patient monitors

Market Size

Healthcare spending (including investment) 2015

 

... as percent of GDP

5.6 %

Hospitals, Procedures, Healthcare Professionals

Number of hospitals

 

…Public

1,386

…Private

2,960

Number of hospital beds

Public 149,608

Private 44,006

Number of surgical procedures

Public 3,712,000

Private 931,000

Physicians

Public 241,914

Private 79,514

Demographics

Population

125 million

Life expectancy men/women

72.3/77.7

Infant mortality

28.7 per every 100,000 under 5 years old

Percent of population older than 65 in 2015

3.6%

...projection, 2030

14.8% older than 60 years

Annual deaths

633,641

...caused by [Heart diseases]

24.7 %

...caused by [Diabetes]

17.4 %

A range of non-communicable diseases have high rates of incidence, particularly obesity, heart disease, diabetes, and chronic respiratory disease

 

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