Mexico\u2019s\npresident, Andr\u00e9s Manuel L\u00f3pez Obrador (AMLO), campaigned on increasing\nsecurity and waging war on corruption\u2014improving healthcare appeared to be almost\nan afterthought. And this is still true.<\/p>\n\n\n\n
Since taking office in December 2018, AMLO<\/a> has made it clear that improving the efficiency of government spending is a top priority, and this means reshaping how the government is managing purchases in all industry sectors, including healthcare. The rules of the game are changing. The risks are high for all stakeholders, particularly established players and patients. Let\u2019s review some key numbers for Mexico\u2019s healthcare system<\/a>:<\/p>\n\n\n\n The public sector represents over 80% of hospital beds in Mexico<\/a> and approximately 60% of the revenue of established players, whether these be medical equipment, medical device<\/a>, pharmaceutical<\/a> or consumables manufacturers. The public sector is big business, where winning tenders is a critical component of maintaining the topline. Manufacturers often partner with distributors to leverage local contacts and broaden reach. And in a country where kickbacks are a common business facilitator, it is not surprising to see AMLO\u2019s anti-corruption policies seek to reshape purchase processes. <\/p>\n\n\n\n Main\nStructural Changes to Public Tenders<\/strong><\/p>\n\n\n\n Affected\nStakeholders <\/strong><\/p>\n\n\n\n These include products with proven and\nestablished quality standards, the patients who rely on them, the doctors who\nuse them, the companies who manufacture them and the providers who distribute\nthem. More specifically, these changes will affect:<\/p>\n\n\n\n Additionally,\nthe overall healthcare system will become less efficient as the Mexican\ngovernment tries to become the sole distributor of products to public\nhospitals. This will further cripple the system\u2019s ability to move to\nvalue-based care.<\/p>\n\n\n\n From\nthe product side, the burden on the healthcare ecosystem will increase as\nlesser quality products\u2014which are typically less efficient and have higher\nfailure rates\u2014are used by patients and the physicians who treat them.<\/p>\n\n\n\n Said\nrisks also threaten the production and value chain: specifically, established\nmanufacturers and distributors. The combined effect of such policies is\nexpected to reduce the potential market for medical equipment, medical devices,\npharmaceuticals and consumables by over 50%.<\/p>\n\n\n\n The\nconsolidated tender of medicines (for the second half of the 2019 fiscal year)\nis already showing signs of inefficiency. The primary points of concern\ninclude:<\/p>\n\n\n\n Such\nvariances can discourage companies from participating in the tender, thus\ncreating a shortage of products in the market.<\/p>\n\n\n\n How\nCompanies Can Adjust to AMLO-Care<\/strong><\/p>\n\n\n\n In\nthe process of adjusting to these policy shifts, manufacturers must change the\nway they look at the market. The topline value will be affected so dramatically\nthat historic viewpoints will no longer be relevant. Instead, metrics such as gross\nprofit<\/strong> and market share<\/strong> will become more appropriate and reflect\nperformance more accurately. <\/p>\n\n\n\n In a market with limited performance indicators, measuring and tracking market share can be very tricky. Thankfully, GHI developed ShareScope, which is a unique market tracking solution with over 90% accuracy when measuring market size<\/strong> and market share<\/strong> of medical equipment in Latin America, market size<\/strong> and market share<\/strong> of medical devices Latin America, as well as market size<\/strong> and market share<\/strong> of pharmaceuticals and consumables for Latin America. ShareScope<\/a> may be the measurement standard your company needs to evaluate performance<\/strong>, track the competitive landscape<\/strong>, assess the threats<\/strong> of Asian products and set your goals<\/strong> for the upcoming years. <\/p>\n\n\n\n
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