While weakening of Mexico's peso is causing problems, generics will fuel pharma market growth

The exchange rate of the Mexican peso against the US dollar is causing uncertainty, with increasing pharmaceutical import costs, according to a new report from Espicom. In spite of moderate growth, the sector will continue to offer long-term opportunities. Takeda is one of the latest multinational producers to establish a subsidiary in Mexico.

On a positive note, the downturn is fuelling generics consumption. This market, which relies on public sales rather than private pharmacy sales, is expected to double in size in 2010. As a result, a number of foreign producers are strengthening their operations, mainly via acquisitions. Valeant, for instance, acquired a local producer in July 2009. Previously, Sanofi-Aventis acquired another local producer in the first half of 2009. Local competition is also increasing. Genomma Lab, for instance, launched its generic product portfolio in August 2009, directly competing with members of ANAFAM, the National Association of Drug Manufacturers.

In September 2009, the reform of the LGS that will allow the sale and production of biologic and biocomparable medicines in Mexico was enforced; the reform was published in June 2009. Article 222 Bis defines and regulates biologic and biosimilar medicines, including the requirements to register and market these medicines. The new regulation represents sizeable opportunities for both local and foreign producers. Local producers such as Probiomed, Silanes and Landsteiner Scientific already produce biologic medicines in Mexico. Competition, however, is expected to arise from foreign producers. On a patient level, the new regulation provides product safety and availability.