«COFEPRIS’ International Strategy»
June 2014
Content
I.
COFEPRIS and the Economy
II.
COFEPRIS in the International Landscape
III.
Axis of Government: Mexico as an Actor with Global Responsibility
IV. COFEPRIS’ International Strategy
V.
Actions of the International Strategy
VI. Conclusions
2
I. COFEPRIS and the Economy
• The Federal Commission for the Protection Against Sanitary Risks (COFEPRIS) is the Mexican
institution responsible to guard and preserve the citizen´s constitutional right to Health through
sanitary vigilance, regulation, and outreach.
• COFEPRIS was conceived by law as a macro sanitary regulator compared to other international
sanitary agencies which regulate specific industries individually.
Regulated Sectors
1.
2.
3.
4.
5.
Food and Beverages
Health Supplies
Health Services
Cosmetics and beauty products
Pesticides, Vegetable nutrients
and Toxic substances
6. Emergencies
7. Labor Safety and Health
8. Environmental Risks
The value of the products regulated by COFEPRIS represents 9.8% of
Mexican GDP.
Industries Regulated by COFEPRIS
Billions
(2009 last available year)
700
624
600
500
400
237
300
151
200
139
100
24
10
Industria Alimentaria
Industria Tabaco y
Bebidas
Industria Farmacéutica
Industria química
Fabricación de
Fertilizantes, pesticidas
y otro agroquímicos
Fabricación Material
Desechable de uso
médico, dental,
oftálmico
5
II. COFEPRIS in the international lanscape
COFEPRIS regulates about 11% of the total trade flow between Mexico and the rest of the
world (64% of GDP).
3.5
25,214 mdd
3
% of total trade flow
2.5
2
15,037 mdd
10,551 mdd
1.5
6,747 mdd
1
6,422 mdd
5,394 mdd
5,142 mdd
4,732 mdd
0.5
0
2,200 mdd
Instrumentos y
Otros
aparatos de
Productos
óptica y
Alimentarios y
médicos
Derivados de
Materias
Primas
Productos
químicos
orgánicos e
inorgánicos
Source: DEOI with data from Banco de Mexico (2014).
Productos
farmacéuticos
Aceites
escenciales,
Jabon, Ceras,
Lubricantes
Productos de
las industrias
químicas
Carne y
despojos
comestibles
Bebidas y
vinagre
Leche,
lácteos,
huevos y miel
1,421 mdd
Pescados,
crustáceos y
moluscos
439 mdd
Tabaco y
sucedáneos
elaborados
7
•
In 2011, imports of pharmaceutical products amounted 4.54 billion dollars, while exports were 1.77 billion
dollars. There was an accumulated deficit of 2.8 billion dollars.
•
On the other hand, the trade balance for medical devices presents a surplus. During 2011, exports of medical
devices amounted to about 6.1 billion dollars, while imports were approximately 3 billion dollars. The trade
surplus was higher than 3 billion dollars.
Exports and Imports of Pharmaceutical
Products, Mexico (2008-2011)
Exportaciones
4,063
4,000
4,325
5,000
3,000
2,500
1,500
1,774
1,305
1,268
6,072
6,000
3,881
3,500
2,000
Importaciones
4,540
1,458
Millions of dollars
Millions of dollars
Exportaciones
Importaciones
7,000
5,000
4,500
Exports and Imports of Medical Devices
Mexico (2008-2011)
5,453
4,758
4,804
4,000
3,032
3,000
2,092
2,160
2008
2009
2,411
2,000
1,000
1,000
500
0
0
2008
2009
Source: Statistics of Foreign Trade INEGI (2013).
2010
2011
2010
2011
8
III. Axis of Government: Mexico as an Actor with
Global Responsibility
9
• Current Mexican administration established since the beginning of its
term the need to have an effective government to generate concrete
results that could be reflected in the well-being of Mexican families.
• To this goal, the Mexican government announced 5 axes of government
policies that turn around of this objective. Axis number five, to achieve
that Mexico become an Actor with Global Responsibility, is mandated to
consolidate Mexico as a solidary country, committed to best causes of
mankind.
• With the above as a guideline, the drug policy of Mexican government
has been aligned with the 3 health priority axes:
Characteristics of pharmaceutical policy
– Rests on four fundamental pillars
– The pillars are aligned with the 3 priorities of health policy established by the Federal
Government.
– Its main objective is to improve access of the population to a well-supplied drug market that
offers innovative and generic medicines at the best prices.
Pillars of Pharmaceutical Policy
Government’s Health Policy Priorities
A regulatory agency that guarantees the
safety, quality and eficacy of all drugs.
A reliable scheme to authorize sanitary
registrations.
Removal of barriers to market entry for
products that are safe and of high quality.
Harmonization of the sanitary agency with best
international practices.
1. Effective Access
2. Service quality
3. Prevention
Evolution of the Mexican Pharmaceutical Regulation
During this period the sanitary 1. The legal requirement of Domestic market with
registrations for medicines had indefinite
only two types of
bioequivalence is
duration and without the legal obligation
medicines:
implemented.
to be bioequivalent.
2. A netwrork of laboratories 1. Innovative Drugs
2. Generics
is created to perform
bioequivalence tests
through Authorized Third
Parties.
1920
First Saniitary
Registration
issued in Mexico
2001
July 5
COFEPRIS is
created
2005
Reform to the
National Health
Law
2010
2012
2014
PAHO
Implementation of
WHO declares
National Healh Law recognizes
COFEPRIS a
Reform on renewal COFEPRIS as
NRA of Functional NRA
of Sanitary
Regional
Registrations
Reference
IV. COFEPRIS’ International Strategy
The international strategy of COFEPRIS consists on the
harmonization with international best practices and is based on
two main areas:
1. Modification of the Mexican regulatory framework to remove
barriers to market entry.
2. Expanding the access of the population to health products,
ensuring the safety, efficacy and quality.
Benefits of the International Strategy
• It increases access to innovative therapeutic options, which
increase the quality of life and life expectancy of the Mexican
population.
• It generates public and private savings from generics entry
to the market.
• It boosts the competitiveness of the pharmaceutical
companies.
• It facilitates Mexican companies to enter into pharmaceutical
and medical devices markets in other countries.
V. Actions of International Strategy
Actions of the International Strategy
Axis of modification to the Mexican regulatory framework to remove barrierts to market entry
1.
2.
3.
4.
5.
Certification by the Pan American Health Organization (PAHO).
Vaccines and drug recognition by WHO.
PICS membership process.
Participation in the International Medical Devices Regulation Forum (IMDRF).
Strong protection of intellectual property rights.
Axis of Increasing access of population to innovative health supplies.
1.
2.
3.
4.
5.
6.
Agreement for the Promotion of Innovation.
Recognition of Certification of Good Manufacturing Practices (GMP).
Equivalence Agreements.
Recognition of Mexican sanitary registries in other countries.
Pacific Alliance.
Agreements of Confidentiality and Cooperation Agreements between COFEPRIS and other
sanitary agencies.
17
Modification to the Mexican regulatory
framework to remove barrier to market entry
Modification to the Mexican regulatory framework: Certificación by PAHO
• In June 2012, COFEPRIS was recognized by PAHO due to its best practices regarding the
inspection of quality and safety of health supplies used and consumed by Mexicans.
– The first sanitary agency to score 100% in its evaluation.
– The first sanitary agency to be recognized by PAHO jointly for drugs and vaccines.
• These actions translate directly into regulatory harmonization, legal certainty and
transparency isolating discretionality and expanding access for Mexicans to safe
medicines and vaccines.
• Mexico’s sanitary policy and legal framework proved to be coherent with PAHO’s objective
and have allowed COFEPRIS to promote cooperation and regulatory harmonization
abroad in countries such as Colombia, El Salvador, Ecuador, Chile, Costa Rica, Panama
and Peru.
• In Latin America only 5 out of 45 (10%) national sanitary regulatory agencies have been
recognized by PAHO with level 4 which is the highest possible level.
Modification to the Mexican regulatory framework: Recognition by the WHO of COFEPRIS for vaccines
COFEPRIS concluded the audit process for vaccines by the WHO:
1) This process led to the recognition as a FUNCTIONAL National Regulatory Agency (NRA) regarding vaccines.
2) Seven critical steps were defined in order to obtain the recognition of the WHO:
STEP 1
Reunion with representatives of the WHO about future colaboration and
execution of the cooperation agreement.
April 16-19th, 2013
STEP 2
Harmonization of procedure and evaluation tools WHO-PAHO.
June 3-7th, 2013
STEP 3
First Informal review in COFEPRIS with colaboration of WHO staff.
August 20-21st,
2013
STEP 4
Internal auditing on the fulfillment of the evaluation tool and on the quality
management system
May – July 2013
STEP 5
Delivery all the evidence to the Share Point WHO website
January 31st, 2014
STEP 6
Formal auditing to COFEPRIS by WHO regarding vaccines.
March 10-14th,
2014
STEP 7
Report Closure: review of recommendation compliance.
June 9th, 2013
The result of the audit was positive. Therefore, COFEPRIS is a FUNCTIONAL Regulatory Agency regarding vaccines.
Modification to the Mexican regulatory framework: Process for Membership in
PICS
• The formal process to access PICS has the following updates:
I.
On December 09, 2013, COFEPRIS received the first report of observations made by the
inspectors.
II. These observation state that the regulatory framework of COFEPRIS for inspections is
sound, therefore only miminal clarifications are needed for COFEPRIS to make.
III. On April 14, COFEPRIS answered the observations made by the Secretariat of PICS.
IV. It is expected than in May the process of access of the Mexican agency can be discussed.
• Membership in the PICS will represent benefits to both, the sanitary agency and the industry in
terms of avoiding duplicity of inspections. This will be achieved by mutual recognition of GMP
certificates among all 44 (countries) members of the scheme.
• Competitiveness of the domestic industry will be favored by the reduction of barriers to the entry of
Mexican exports to international markets.
21
Modification to the Mexican regulatory framework: Participation in the
International Medical Devices Regulation Forum (IMDRF)
• The IMDRF is the most recognized forum for countries working for
convergence and harmonization in the regulation of medical devices.
• Mexico has participated in this forum since March 2013, as an observer,
and in the near future it will acquire full membership, joining Australia,
Brazil, Canada, Europe, Japan, USA and China.
• Thus, with the participation in international forums and the recognition by
WHO, Mexico will go ahead in topics relevants for Mexican patients and
industry. This will facilitate the access to innovative supplies and will
foster the Mexican exports of medical devices.
Increasing access of Mexican population to
innovative health supplies
Increasing Access: Agreement for the Promotion of Innovation
• In the past, new molecules in Mexico took an average of 360 days to enter the
pharmaceutical market.
• The agreement on new molecules represented an effort to strengthen the
access of Mexican families to medicines, reduce health care costs and
encourage innovation in three key areas:
1. Foster projects of innovation in Mexico.
2. Strengthen the entry of molecules from other countries to the Mexican
market.
3. Mexico became a first country to market an innovative drug.
• The new regulation provides a framework by which Mexico became the fastest
country to authorize the marketing for new molecules (from 360 to 60 days)
while, at the same time, ensures the efficacy, security and quality of medicines.
24
Increasing Access: Agreement for the Promotion of Innovation
• Mexico implemented equivalence agreements regarding medicines with the USA, Canada, Europe, and Australia.
This action has increased the access of Mexican population to medicines.
• Additionally, Mexico substituted the requirement of a foreign free sale certificate with a report of clinical studies in
Mexican population in order to incentive pharmaceutical innovation.
• Two new molecules have entered the Mexican market as a global launch pad: Lixisenatide used to treat Type 2
Diabetes and Fluticasone/Vilanterol used to treat Chronic Obstructive Pulmonary Disease (COPD).
Days to Grant Registration for Innovative Drugs
360
300
300
290
270
220
200
203
180
180
150
120
120
100
90
60
México (con acuerdos)
Brasil
India
Argentina
Reino Unido
Estados Unidos
China
Australia
España
Singapur
Arabia Saudita
Canadá
0
México (antes)
Number of Days
400
25
Increasing Access: Agreement for the Promotion of Innovation
• The opportunity cost associated with the days a file is processed has decreased in
approximately 40 million dollars (500 million pesos). This cost was estimated in 45
million dollars (570 million pesos).*
• Further, with the equivalence agreement on new molecules, the regulatory burden for
each file decreases in 82%.
Benefits of the agreement on new molecules
45 million dollars
Before the agreement
With the agreement
Decrease in opportunity cost of 40
million dollars (500 million pesos).
7 million dollars
Reduction in regulatory burden
of 82%.
100%
18%
Oportunity Cost (in million dollars)
Regulatory Burden (%)
* Calculation of the opportunity cost consists of the daily administrative cost to process registrations for new molecules multiplied by the
number of days requeried to grant authorization.
26
Increasing Access: Agreement for the Promotion of Innovation
Impact of innovative medicines on public health
• International research has shown that the introduction of
innovative drugs shows a high positive correlation with life
expectancy.
• In the absence of pharmaceutical innovation, there would be no
increases in life expectancy of individuals.
• The data shows that the introduction of innovative drugs
increases the income of a person (in his life cycle) in approx.
0.75-1% per year.
27
Increasing Access: Recognition of Certificates of Good Manufacturing
Practices. Savings derived from the measure
• The economic benefits are composed in 99% of the opportunity cost of the
termination of the administrative process and represent about 200 million
dollars.
• Each day the termination of an administrative process is delayed it has a cost
between $50,000 and $60,000 pesos for the industry.
ESTIMATED BENEFITS OF DEREGULATION
1,339 GMP applications eliminated
Concept
Reduced Aggregated administrative burden
Reduced Aggregated Opportunity Cost
Total Economic Benefits
Savings as percentage of GDP
Million USD
15.2
1,850.4
1,865.6 0
0.015%
28
Increasing Access: Issuance of Registrations through Equivalence Agreements
• The scheme is based upon the recognition of the registrations issued by FDA,
Health Canada, and Japan for medical devices of any class and COFEPRIS will
issue the corresponding registration in a maximum period of 30 working days.
Received Applications
Market Value of the applications
Reduction in the Regulatory Burden
Approved Applications
The Incoming Applications Correspond to:
(Medical Devices)
3,811
353 million dollars in the Mexican market
(1.2 million pesos each registration).
40%
64% from FDA
33% from Health Canada
3% from Japan
35% Class 1
38% Class 2
27% Class 3
• To this date 2,947 sanitary registrations have been approved by COFEPRIS.
Increasing Access: Recognition of Sanitary Registrations Abroad
• Sanitary registrations issued by COFEPRIS are currently recognized in 6 countries:
Ecuador, El Salvador, Colombia, Chile, Costa Rica and Panama.
30
Increasing Access: Pacific Alliance
• There is a regional regulatory weakness in sanitary issues since the regulation
does not provide mechanisms to ensure local production of generic
bioequivalent, making nugatory the savings associated with these products.
• In this situation, governments are in the need to acquire only patented
versions of medicines, which exceed about 65% the price of generics.
• In Mexico, the health law allows a robust licensing scheme of bioequivalent
generic medicines. This was recognized by the Pan American Health
Organization (PAHO) in 2012, through the granting of the Level IV, the
maximun level of recognition for a sanitary agency.
Increasing Access: Pacific Alliance
• PAHO has created a mechanism to secure access to pharmaceuticals for
countries that do not have the ability to guarantee safe generic pharmaceuticals.
• The mechanism involves the Certification of Sanitary Agencies to ensure the
authorization of medicines and vaccines in accordance with best international
practices, conferring them the status as a National Regulatory Authority of
Regional Reference Level IV (Level IV NRAs are: Argentina, Brazil, Colombia,
Cuba and Mexico).
• In the case of Mexico, the policy of access to generic medicines from the
federal government has enabled extraordinary benefits for the population and the
public sector. With the access mechanism between agencies, the population of
both countries would benefit.
Increasing Access: Pacific Alliance
• In 2.5 years, this has allowed the approval of 287 generic drugs that
correspond to 31 active substances. They attend the 71% of causes of
death in Mexican population.
• There is no international record of a strategy of liberation of generic drugs of
such magnitude and in a short time.
• Savings of 1.5 billion dollar were made in 2 years, and more than 1 million
of additional patients were treated in the public sector.
Number of
Packages
Released
Substances
New Generics
Accumulated savings
(billion dollars)
Aditional
Patients
11
31
287
1.5
1,124,922
33
Increasing Access: Savings in medications in both private and public
sectors (2011-2014)
• The average price of medications in drug stores has decreased 62%.
• The average price for public purchases of medications has decreased 60%.
Medicine Prices in Public Sector and Private Sector, Mexico (2013)
$1,800
$1,600
Prices for Private Sector
Prices for Public Sector
$2,073
Reduction in prices of
62%
$1,400
$1,200
$1,000
$788
$800
$809
$600
$400
$200
Reduction in prices of
60 %
$324
$0
Before the delivery of active sustances
Time
After the delivery of active sustances
34
Increasing Access: Pacific Alliance
• Average savings of 65% created by the reduction of prices, compared with the
innovative substance, in the first 3 years.
Expectations of lower prices
with the harmonization mechanism of NRAs in the PA
$80.0
$70.0
Average prices in the
Mexican market = U.S. $
12.13
$60.0
$50.0
$40.0
$30.0
$20.0
$10.0
$0.0
Tiempo
The substances in the sample: Atorvastatina, Clopidogrel, Escitalopram, Irbesartán, Losartán, Montelukast, Pioglitazona,
Rosuvastatina, Sildenafil, Telmisartán, Valaciclovir, Valsartán.
Increasing Access: Pacific Alliance
• Drastic and immediate increase in the supply of pharmaceutical products modifying
the portfolio of choices available for patients.
Price
Reduction in
Medicine Prices
Result of
Cooperation
between NRAs
Increased Supply
of Medicines
Availability of
Medicines
Increasing Access: Pacific Alliance
• It has been estimated that out of pocket expenditures in members of the Pacific Alliance
could be reduced around 16.3% (as a percentage of health expenditures) in 3 years.
40
Projected Average Pocket Spending in Countries of the Pacific Alliance
(as a % of Total Health Expenditure)
32.73
30
22.91
19.63
20
16.36
10
0
Actual
Fuente: COFEPRIS (2013) con datos del Banco Mundial (2011).
Year 1
Year 2
Year 3
37
Conclusions
Conclusions
The international strategy of COFEPRIS can generate the following benefits:
• An increase in the potential number of patients who will benefit from drugs with sanitary
registry from COFEPRIS.
• An increase in the catalog of drugs to treat diseases that are the major causes of
mortality in the population.
• A reduction in drug prices, an increase in the access by patients and a decrease in out
of pocket spending by individuals.
• An increase in the public sector capacity to attend more patients.
• Participation in international forums and agreements on drugs regulation, and
harmonization of pharmaceutical regulation.
• Strengthening of the relationship with other sanitary agencies from the continent.
• Recognition from international sanitary regulatory agencies.
•
In 2010, about 30% of the market value corresponded to generic drugs, while in 2012 this figure
rose to nearly 52%. This represents an increase of 77% in just two years.
•
On the other hand, generic drugs in 2010 represented 54% of the market volume, while for 2012
accounted for 84% of the pharmaceutical market in Mexico. This represents a growth of 56% in
the period 2010-2012.
90
Penetration of Generics in the Mexican Pharmaceutical Market, 2010-2012
80
Market share (%)
70
60
50
84.1
40
30
20
10
51.9
54
2012
2010
29.3
0
2010
Market
(%), (%)
value
Valor deshare
mercado
Source: Funsalud. Analysis with information from IMS Health (2012).
2012
Market share
(%), volume
Volumen
de mercado
(%)
40
• Mexico is one of the countries with the highest penetration of generics in the
pharmaceutical market.
• Of the countries studied, Mexico has the greatest value of the generic market, almost
52%. It also has the highest penetration in terms of market volume, 84%.
Penetration of Generics Drugs in the World, 2012
Participación de mercado (%)
100
Valor
Volumen
80
60
84
40
20
78
68
67
63
52
37
37
35
33
54
44
26
68
24
44
23
21
0
México
Canadá
Fuente: IMS Health (2012). Funsalud (2012).
Alemania
Reino Unido
Francia
Italia
España
Japón
E.U.
41
• Mexico gained two positions in pharmaceutical spending as a percentage of total health expenditure,
from 28.3% in 2010 to 27.1% in 2011.
• This development is associated with the access strategy for pharmaceuticals from the Ministry of Health,
which have generated savings of 20 billion pesos in 2 years. This rate will continue decreasing,
according to the 2011 figure.
Spending on Pharmaceuticals in different countries
Gasto
en medicamentos
como
%ofdeltotal
gasto
en salud
Spending
on pharmaceuticals
as a %
healthtotal
expenditure
(left(lado
axis) izq.)
Spending
on pharmaceuticals
as a %
axis)
Gasto
en medicamentos
como
%ofdelGDP
PIB(right
(lado
der.)
3
35
2.5
2
6.8
6.8
8.4
9.4
9.4
9.4
Denmark
Norway
Luxembourg
New Zealand
Netherlands
11.4
0.5
0
Switzerland
United States
Austria
Sweden
Chile
Finland
Germany
Iceland
Australia (2010)
Belgium
France
Italy
OECD
Canada
Spain
Ireland
Portugal
Slovenia
Czech Republic
Korea
Japan (2010)
Estonia
Poland
Mexico (2011)
Mexico (2010)
Slovak Republic
Greece
0
United Kingdom…
11.7
11.7
12.1
12.6
13.2
14.1
15.4
15.4
15.5
15.6
16.2
16.4
16.6
17.4
17.5
5
1
17.9
19.5
20.0
20.2
20.3
21.5
22.5
28.3
27.1
10
27.4
15
1.5
28.5
20
33.4
25
% of GDP
30
Hungary
% of total health expenditure
40
• The policies of the generics drugs access implemented in Mexico and the certification
as a NRA level IV by PAHO have helped to reduce out of pocket spending in Mexico.
• Between 2011 to 2012, the out of pocket spending in Mexico has decreased from
46.5% to 44% of total health expenditure.
Out of Pocket Spending in the Pacific Alliance, 2012
(as a % of Total Health Expenditure)
50.0
45.0
Out of Pocket Spending
(as a % of Total Health Expenditure)
40.0
35.0
30.0
25.0
46.52
20.0
44.08
35.72
15.0
26.92
26.43
10.0
5.0
14.76
13.62
Colombia
OCDE
0.0
México (2011)
Source: World Bank (2014).
México (2012)
Perú
Alianza
Pacífico
Pacificdel
Alliance
Chile
43
The issuance of 21,292 sanitary registrations from March 2011 to May 2014, represents a market value
greater than 2.4 billion dollars, and has a growth rate of 13,908% relative to 2010. Progress has been
as follows:
25,000
Issuance of 546 sanitary registrations
per month, on average, in the period
March, 2011- May, 2014
20,000
15,000
10,563
11,618 11,900
11,312
13,344
13,700 13,873
14,384 14,657
15,100
16,453
15,602 16,017
16,673
17,394
17,862 18,233
18,745 19,209
19,823
19,977 20,377
20,916 21,292
10,000
7,419
5,000
152
0
• A total of 10,729 sanitary registrations have been issued from June 2012 to May 2014.
This improvement implies an average of 466 monthly registrations. The issuance of
sanitary registrations will continue growing given that COFEPRIS regulates 10% of GDP.
•
•
The pharmaceutical policy implemented by COFEPRIS has increased the value of the Mexican market. In
2012, the value of the pharmaceutical market in Mexico was estimated in 13 billion dollars.
Mexico is placed among the 15 largest pharmaceutical markets in the world and holds the second
place among Latin American countries.
The pharmaceutical market expanded by an average annual rate of 4.7% from 2005 to 2012. However,
from 2011 to 2012 the annual growth rate of the pharmaceutical market was 6.5%.
Value of the Pharmaceutical Market in Mexico
(2005-2012*)
Annual Growth: 6.5%
Average Annual Growth: 4.28%
Millions of Pesos
•
200,000
180,000
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
2005
2006
Source: Authors´s elaboration with data from INEGI
* Value estimated for 2010 and 2011.
2007
2008
2009
2010
2011
2012
«COFEPRIS’ International Strategy»
June 2014