Green Gold Rush Limited by Regulation
Mexico has moved away from its prohibitional model but there are still gaps in the regulation of cannabis for medical, scientific, industrial and even recreational use. However, judicial rulings are pushing for clarity and expedited regulation, said Alejandro Luna, Partner Litigation and Life Sciences Co-chair at Olivares, during the opening presentation of Mexico Health Summit 2019, held on Thursday at Papalote Museo del Niño in Mexico City.
“Cannabis products are present in the food, beverage, medicine and textile industries, to name a few. The combination of several factors, including the fight against drug dealing and the medical benefits of cannabis, led many countries to adopt a new stance toward its use,” Luna said.
In Mexico, change was also fueled by confrontations between people looking to access cannabis-based medications and the authorities. Luna highlighted the case of Grace, a sick child whose parents were not allowed to import medicinal products with cannabidiol. After Grace’s family presented an amparo against the country’s prohibitive regulations, amendments were made to the General Health Law. “The Supreme Court was the first to take a step toward a new regulation, even in terms of recreational use,” he said.
The Supreme Court decided that the prohibition regarding cannabis use was unconstitutional. “The fundamental right to free personality development establishes that adults have the right to decide in which recreational activities they participate. This makes cannabis use an activity proper to the autonomy of each person, as long as it does not affect third parties,” Luna said
Refusal from the san.itary regulator to analyze the import of a medicine based on cannabidiol opened the door to analyze the regulation. According to Ingrid Ortiz, Associate of Life Sciences at Olivares, in 2017 former President Enrique Peña Nieto presented an initiative to revise the General Health Law and the Federal Penal Code, although this was only focused on medicinal and scientific use. Changes included the regulation for cannabis use and cannabis-based products, as long as there was a permit from the Ministry of Health, permission to plant and grow cannabis plants and the possession of up to 5g of cannabis.
“COFEPRIS established the guidelines regarding control of cannabis and derivates, which led to 62 approvals for products, including raw materials, food, supplements and medicine. However, in March 2019, these guidelines were revoked by COFEPRIS based on the argument that the guidelines surpassed medicinal and scientific use,” said Ortiz.
Besides the revocation of permits, regulations are still unclear on how to obtain cannabis for consumption and manufacturing of cannabis-based products. Ortiz says today there are nine active initiatives to reform regulations, the last one presented only a month ago. Meanwhile, Luna highlighted the Supreme Court’s latest ruling established that, as of two weeks ago, COFEPRIS had a 180-day timeframe to develop a complete regulation that considered the sourcing, storage, distribution and commercialization of cannabis and cannabis-based products for medical and scientific use.
“There are already companies wanting to participate in the growing cannabis industry but lack of regulation prevents proper business development. Today, there is a green gold rush in Mexico and the world and even though not everyone will become a millionaire, many will get rich by selling picks and shovels for those seeking gold,” he said.
Boost Health Access Through Integrative Strategies, Will to Implement Them
Increasing access to healthcare services is a common goal for many players in the sector, but individual areas are implementing their own strategy to address the problem. At Mexico Health Summit 2019 on Thursday, representatives from major areas of the sector discussed integrative strategies that can bring different players together to increase access to health.
The panelists at Papalote Museo del Niño discussed the priorities that must be addressed if the country is to step closer to the elusive goal of achieving universal care. The challenge is not simple. “Mexico has a complex epidemiological profile as it must treat infectious diseases that are more common to emerging economies and non-communicable diseases that are more prevalent in richer countries,” said Americo García, Director General of Mexico and Latin America at Apotex.
The common problem for the sector as a whole, however, is obvious but equally difficult: money. Among all OECD countries, Mexico has the second-lowest investment in healthcare as a percentage of its GDP. “An essential issue to achieve universal care is financing,” said Ignacio García-Téllez, Director of Health Sector of KPMG in Mexico.
The problem will likely be exacerbated after recent budget cuts and regulatory changes that could further hurt an already fragmented system. Help could come from beyond the government. “The federal budget for many areas including healthcare is shrinking, so private industry can support the public sector,” said Alejandro Gil, Director General of Centro Médico Puerta de Hierro.
While public institutions provide care for most Mexicans, the quality and quantity of services they provide varies widely by institution. This has pushed many toward the private sector. Today, out of pocket expenditure surpasses 40 percent of the country’s total healthcare expenditure, a high number in comparison to other OECD countries. Moreover, only about 8 million Mexican have health insurance, a low number according to García-Téllez. While Gil supports the generation of public-private alliances (PPAs) to reduce spending and increase efficiency, Macedonio Garza, Director General of Farmacias Benavides, proposed a complementary strategy: “Doctors at the point of sale play an important role in increasing access to care, especially for primary care.”
While partnerships with the public sector will benefit patients, alliances among players from different industries are also key. However, the spirit of collaboration must begin with players from the same segment. Gil explained this need in terms of his own industry. “Private hospitals need better integration because most operate individually.” Operating as partners instead of competitors can result in many benefits for hospitals and patients. “For instance, in the US, hospital groups can perform consolidated acquisitions that reduce costs and allow them to offer less expensive medications to patients.
The panelists agreed that optimizing budgets was a key element in allowing their segments to increase access. Alejandro Paolini, Director General of Siemens Healthineers for Mexico, Central America and Caribbean, took this idea one step further. “To increase the efficiency of the healthcare budget, it must be redirected toward prevention. Every peso spent on prevention saves three pesos that would have been spent on treatment. Investing in prevention would allow for better results with the same budget.”
To implement these strategies, the sector needs a stable playing field to plan. “Mexico needs a clear regulatory framework that allows all players to put the patient at the center of attention,” said García. To achieve this, the sector needs an efficient regulator. “The regulator plays an essential role in the healthcare sector because it must balance protecting the patient’s health while ensuring they have access to innovative medications. A regulator that is too strong will limit access. A regulator that is too lax places the public at risk,” said Paolini.
The entire healthcare sector requires a fundamental change that integrates the efforts from a diverse range of areas, from R&D to distribution. A tool that is touted for its benefits across sectors is technology. “Technology provides significant advances in many areas, including diagnostics, helping doctors to diagnose diseases faster and improve the patient’s life expectancy while reducing costs. In terms of treatment, technology can permit minimally invasive surgeries that turn procedures that required hospitalizations for five or six days in ambulatory care, greatly increasing the patient’s comfort and reducing hospitalization costs,” said Paolini.
While panelists agreed that technology can increase efficiency across many sectors, García pointed to an even more essential need. “What is necessary is not technology, but will. Mexican players need the will to work and collaborate to develop integrated strategies that benefit patients across the country.”
Change in Mindset Needed to Unlock Technological Potential
Adoption of digital health tools could improve patient care and reduce treatment costs but a change in mindset is still required to make new technologies part of the mainstream, said Mario Muniz, Director General of IQVIA, at Mexico Health Summit 2019, held on Thursday at the Papalote Museo del Niño in Mexico City.
“Boosting adoption of health apps to improve care for patients with diabetes, asthma, pulmonary rehabilitation, cardiac rehabilitation and diabetes prevention could lead to savings of US$7 billion in the US,” said Muniz.
According to Muniz, there are over 318,000 health-related apps globally and 200 new ones are created every day. Moreover, 40 percent of all apps are oriented toward disease management rather than on wellness monitoring. “Companies are using apps for insurance purposes, to follow up on treatments and register symptoms. In terms of diseases, 28 percent of all apps are focused on mental health and behavioral disorders, 16 percent on diabetes and 11 percent on heart disease,” he said.
The innovative use of sensors has also helped apps track more indicators, including calories, steps, heart rate and sleep patterns. “Sensors are now used for smart devices focused on user experience, digital diagnostics with increased reliability and clinical trials with increased recruitment speed, more effective monitoring and follow-up,” said Muniz.
However, the number of apps appearing in the market means an increased offering for patients that does not always comply with basic quality standards. To tackle this issue, IQVIA released its AppScript Score Overview to measure the quality of apps based on different factors, including the patient, the app’s development and its capabilities in terms of disease management, wellness and prevention.
Today, Muniz says 20 percent of health industry professionals use digital health tools, 26 percent of all physicians recommend digital apps and 13 percent use remote monitoring to follow up on patient development. In 10 years, Muniz expects digital health to become the new normal for most organizations.
“There are still doubts regarding data security and the legal framework regarding digitalization. We also need electronic medical records and digital prescriptions to boost adoption of digital health tools. However, the main issue we need to tackle is mindset, both of companies and patients. A change in mindset will be the only way to take advantage of the potential of these tools,” he said.
The Paradox of the Healthcare Supply Chain
Whether it is logistics, hospitals, pharmacies or technology companies, there is a shift toward putting people and their needs front and center in the healthcare industry, panelists said at Mexico Health Summit 2019, as they reflected on the paradox of the healthcare supply chain.
“In the industry, we are used to talking about patients, when we should be talking about people. Hospitals of the future will be health units focused on attending healthy people, rather than sick ones,” said José Elizondo, Founder of Wellmedic Health Centers, during a summit discussion at the Museo Papalote del Niño in Mexico City on Thursday.
Elizondo was joined by Marcos Pascual, Commercial Director of ANAFARMEX; Anil Andrade, Director General of ACG Group and Eduardo Tapia, Director of Life Science and Healthcare for DHL Supply Chain Mexico, to discuss how supply chain companies and hospitals are using technology to migrate to a model where needs of end-users are privileged and attended in a more efficient manner.
Pascual said that the implementation of doctors’ offices at points of sale has generated further access to basic health services. “Doctors’ offices adjacent to pharmacies have been the private sector response to provide health coverage with certified doctors and medications at accessible prices,” said Pascual. Elizondo acknowledged that the implementation of these points of health services have allowed an improvement in access to basic health attention but they do not solve the problem of access to specialists. “During the past governmental administrations, we have seen investment destined to alleviate the health infrastructure problem. However, the paradox we are seeing is related to human capital.”
For Elizondo, in a country where only three out of 10 doctors have a specialty degree or sub-specialty, telemedicine presents an interesting opportunity to provide more coverage and to continue putting patients front and center. “The human capital deficit that exists in the country will only be solved through digitalization of health services,” he said.
Implementation of technology solutions and digitalization not only touches upon access to medical attention but also in the medication distribution and tracking scheme. “Patients need to be able access medicines wherever they are. However, they need the certainty that the product they are consuming is not fake. In this sense, medicine tracking becomes vital,” said Andrade. “The use of aggregated data can help patients and guarantee them that their product is authentic.”
In addition to guaranteeing product authenticity, Tapia mentioned that logistics companies have the responsibility of guaranteeing that medicines and medical devices they deliver are maintained in quality conditions. “We are seeing how IoT can help us to obtain real-time information regarding the conditions of the medicine and allow us to implement better quality control.” Although companies are still far from implementing all the available technology solutions in the market, Tapia said that they are all going through a transformation process that aims to be more efficient and useful for patients. “In other countries, DHL even helps in the transport of patients. As a logistics company, we are working on finding the best way to put patients front and center.
The Future of Medicine, Today
Chronic diseases continue to be the bane of developed economies. Mexico has an additional problem in the shape of infectious diseases, which still affect millions of individuals every year. While many strategies have been implemented to tackle these problems, the sector has not found a one size fits all solution. However, all sectors, each in their own way, is searching for the next treatment that might save a life. At Mexico Health Summit 2019, held at Papalote Museo del Niño on Thursday in Mexico City, panelists addressed relevant research lines that, in the near future, will address the problems of today.
A pressing problem, agreed panelists, is identifying the problem on time. “Doctors arrive late; we only treat patients once they are sick,” said David Kershenobich, Director General of INCMNSZ. Preventing a disease is not just cheaper than treating it but it is overall better for the patient, who can avoid complex treatments, medications and surgeries. For that reason, many researchers are looking for better, faster and more precise diagnostic techniques. Luckily, there are tools to facilitate this. “Through the incorporation of the human genome map we will be able to develop innovative medical solutions,” said Felipe Vadillo, Professor and Director of Research at INMEGEN. Kershenobich agreed on the importance of new research lines in addressing diseases: “Another important area is research on the human microbiome, which will allow the generation of numerous treatments,” he said.
Current research is already bearing fruit. “Many treatments that we only dreamed about 10 years ago are now a reality. For instance, US hospitals can now perform liquid biopsies that allow for an easier and faster diagnosis,” said Diddier Prada, Researcher of Medical Sciences of INCan. Moreover, research can also help to prevent a disease altogether. “An interesting area is the development of psychological profiles to identify individuals who do not look after their own health. These profiles will allow doctors to develop better strategies to monitor them and entice them to improve their habits to have a better life,” said Prada.
An area where prevention will be key is chronic diseases, due to their complexity and the limited understanding of them. “Mexicans need to understand that chronic diseases have a complex nature. Even doctors still do not know how they fully work,” said Vadillo. Moreover, chronic diseases place a significant burden on patients and their families. “Chronic diseases force patients to take medications for their entire life,” said Laura Padierna, Director of Biological Applications at LEI. Padierna added that through genomic therapy it may be possible to cure instead of manage these diseases, and the panelists agreed that at this point preventing the disease is more viable. “We have to reach patients earlier through preventive medicine. New screening techniques can allow patients to know their susceptibility to certain diseases before they happen,” said Kershenobich.
Prevention is not just the responsibility of the patient; doctors also play an essential role. “At schools, students are taught to treat diseases. They are provided few classes on preventive measures. Preventive medicine is more effective and less expensive than curative medicine but the country does not have a prevention culture,” said Prada.
Victor Saadia, Founder and CEO of BioCenter, tackled one of Mexico’s biggest problems: the increasing prevalence of obesity. “Obesity and overweight are often multigenerational problems, as very often obese parents have obese children.” In that sense, innovation can also play an important role and even the private sector has taken notice. “About half of Silicon Valley companies address nutrition in one way or another,” said Kershenobich. “This concept is becoming increasingly important and companies are researching the production of better foods that allow individuals to live healthier lives. Mexico has a broad range of unique foods but the country is not taking advantage of this amazing variety.”
While many potential treatments for chronic diseases are being researched at any given time, the importance of prevention has not received the same level of attention. “At this point there are no public programs that research the role of prevention in healthcare,” said Prada. However, its role will only become more importance with time. “Life expectancy is increasing in Mexico and the world, which implies an increasing number of seniors who will require continuous care and monitoring to maintain their quality of life,” said Prada.
Innovation: Key Driver For Growth And Competitiveness
Innovation makes no sense unless it is done with the patient at its center and focuses on problem resolution, panelists said as they reflected on the opportunities at the Mexico Health Summit 2019 at the Museo Papalote del Niño in Mexico City on Thursday.
“The system has an inertia where patients are not front and center. We need to change attention models and innovate to make health services accessible to the overall population,” said Javier Potes, Director General of Consorcio Mexicano de Hospitales, during the panel discussion.
Potes was joined by Eduardo Lara, Head of Health for RGA Latin America; Rodrigo Díaz de Vivar, Subregional Head of Management Center Latin America North and Country Manager of Roche Diabetes Care Mexico; Carlos Septién, CEO of Grupo Diagnóstico Proa; and Ana Longoria, President and Director General of Novartis. The panelists reflected on how there needs to be a coordination between the public and private sectors to make the newest and most innovative treatments accessible to the overall population.
For Longoria, the only way to make health technology and innovation accessible is through a comprehensive integration of the health system. “We are seeing older patients with chronic degenerative diseases, while the generation and commercialization of a new molecule can take up to 10 years of development and cost around US$1 billion. There is no single health system in the world that can face this challenge on its own.
As part of the efforts that need to be implemented to make sure that patients have access to new technologies, Lara said that the industry needs to reimagine its cost model. “We need to start measuring and paying in terms of results of medical services. The worst way to pay for medical care is through a pay-per-service model.” Potes added that in this sense, hospitalization services need to be understood as a service. “We need to continue insisting on the financial and operational model.”
For Septién, the main innovation challenge for laboratories lies in being able to differentiate and generate added value for patients and doctors and avoid being seen as a commodity. In this sense, Septién also emphasized the need to put prevention of chronic-degenerative diseases in the spotlight. “We need to move from a concept of curative medicine toward a prevention scheme. The lack of prevention entails more expenses in the long run.”
As an example of how prevention can lead to cost reduction, Díaz de Vivar said that there are diseases such as diabetes that go beyond the mere medical scope and need to be addressed from an integral perspective. “With digital solutions, we can provide scalability to reach more patients and thus reduce costs.” To which Longoria added, “It is important to have a long-term vision and implement public-private partnerships, so we can reduce technology and innovation costs.”
Collaboration a Vital Step in Prevention Strategy
The impact of healthcare on a country’s economic development is undeniable. Yet, Mexico’s health model is still focused on a corrective rather than a preventive approach, said Sandra Sánchez-Oldenhage, Director General of PharmAdvice and moderator of the Prevention and Education to Improve Health panel at Mexico Health Summit 2019, held on Thursday at Papalote Museo del Niño in Mexico City.
“Mexico invests 5.8 percent of its GDP in health when the average of the OECD is 9 percent. Meanwhile, absenteeism related to health issues has a significant impact on manufacturing activities and revenue generation. Only in the automotive industry, productivity and results are hit by a 7.3 percent reduction,” said Sánchez-Oldenhage.
Prevention can save lives, according to Miguel Salazar, Member of the Board at AMIIF. However, it is normally seen as an added burden. “Just like with innovation, patients tend to see prevention as an added cost related to gyms or different eating habits. In reality, prevention is much more than that. A clinical test can improve a patient’s quality of life if used at an early stage,” he said.
Mario Sicilia, Director General of Laboratorio Médico Polanco, highlighted that to move from a model that cures sick people to one that targets patients before they get sick, the main need is information. “Clinical data is generated each day but it is not used. We know people are going to get diabetes and yet, no one is doing anything about it,” he said.
Change will not be possible from the public or private sector alone. Collaboration is needed from both sides to ensure access to medical care and to push for preventive strategies. To boost penetration of prevention schemes, however, “the different players in the sector need to justify the economic benefits of early disease detection,” said Sicilia.
New business models will also be needed to maximize resource and infrastructure use. “In terms of resources, we need to recognize that Mexico does not invest enough in healthcare. Yet, investment in health is one of the best projects a country can undertake,” said Rodrigo Puga, President and Country Manager of Pfizer Mexico. César Carrasco, Country General Manager of Philips Mexico, said companies are gradually opening their business to democratize access to prevention schemes, with some of them destining their infrastructure and equipment to night-time tests to offer competitive costs without compromising normal activities. “Companies are also developing remote systems to take advantage of underutilized infrastructure during downtimes,” said Carrasco.
There are already communication channels to foster collaboration between the government and the private health sector. What the industry lacks is clarity in how to implement the best strategies to improve the sector, according to Salazar. Nevertheless, all panelists agreed that President Andrés Manuel López Obrador’s willingness to invest in prevention is something that should be celebrated. “As an industry, we need to find ways to collaborate in this goal,” said Puga. “At the pharmaceutical level, companies have a mandate toward prevention.”
Puga highlighted vaccination programs and the work that both private and public organizations are doing toward preventing teenage pregnancy as key elements where industry and government can collaborate toward prevention. “Vaccines are the most important prevention intervention,” he said. Meanwhile, Salazar pointed at initiatives like Cumbia Camaleón as ways in which the industry can collaborate to create awareness. “Prevention campaigns can be another type of vaccine,” he said.
Merge Capabilities to Provide Care
About 68 million Mexicans, over 50 percent, do not have access to healthcare services. Addressing this problem has been the objective of many government administrations and organizations within the public and private sector. At Mexico Health Summit 2019, held at Papalote Museo del Niño on Thursday in Mexico City, Jaime Cervantes, CEO of Vitalmex proposed an integral strategy that will allow the public and private sector to work together to put the patient at the center of care.
“Our healthcare system has made great strides in providing better care, but it is not enough,” said Cervantes. Mexico’s healthcare system aims to provide high-quality, affordable care to over 120 million people but this goal has not been achieved even though the country’s constitution states that healthcare is an essential right for all. The new administration further expands this goal as it aims to provide free medication and healthcare services for all Mexicans through a focus on prevention.
There are many barriers to access. Chief among them, explained Cervantes, is the fragmentation of Mexico’s public healthcare sector. “There are 12 public providers of healthcare and each has its own budget and rules.” Other hurdles are the high operational costs associated with these institutions and the large number of intermediaries between patients and the industry. There is also a significant deficit of doctors, nurses and specialists. The system is hampered further by poor-quality control of hospitals and the sector has not been able to provide electronic medical files. At this point, patients do not have access to their own medical information.
The federal administration’s goal is to address these problems and provide primary attention to all Mexicans through integrated healthcare networks. Cervantes explained that to bring together the public and private sector it is necessary to create mixed contracts that allow the optimal use of all hospitals and clinics within both sectors. “These contracts will allow the system to adapt to the patient instead of the other way around. While players in the sector often say that the patient must be empowered, Mexico’s healthcare system acts as a barrier to doing so.
An example of poor allocation of resources is the distribution of surgeries across sectors. “While IMSS performs 3.22 surgeries per day, hospitals in the private sector perform on average 0.53 surgeries per day.” This problem, explained Cervantes, could be addressed through a mixed contract that would allow for better use of resources and to ensure that patients receive the care they need as soon as they need it. “These contracts must incorporate everything a patient might need from the moment they arrive at the hospital, from medical supplies to all hospital infrastructure.”
The only thing that is necessary to implement these models is the will of the government and the industry. “A reform that will allow for the creation of mixed contracts will allow the provision of care for a larger number of Mexicans, which will be increasingly needed because by 2050 the country will have 150 million habitants. The government will not be able to care for this large population so it falls on us, the private sector, to ensure access to care.”
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