Mexican Drug Copiers Face Grim Future

The impact of regulatory changes to Mexico's pharmaceuticals industry has created severe friction in recent years. With new reforms requiring locally manufactured generic drugs to have proven bioequivalence expected to become law shortly, it is hoped that the changes will herald the end of the trade in so-called "similar" drugs. These are defined as copy products which have no proven bioequivalence to the reference or branded product.

Mexico's government, faced with rising healthcare costs, has now made the need to prove bioequivalence compulsory - and expensive - for many local drugmakers, in an effort to encourage legitimate generics. The impact of the reform process has been widely felt even before the new law's introduction. In 2003, the manufacturer of leading "similares" brand Dr. Simi withdrew from national drugmakers' association Anafam, forming another group with peers in the now semi-illicit industry.

Government sources expect the new legal amendment to mark a further step towards full Mexican compliance with standards in ICH member countries, which have pledged to harmonise drug regulations in the developed markets of the US, Canada, Japan and the EU. The authorities have also moved to tighten criminal penalties against copying and remove so-called "miracle products" from the market.

The research-based industry is increasingly confident on the direction of Mexico's regulatory regime, illustrated by the decision of US research-based association PhRMA not to lobby for the country's inclusion on the Office of the US Trade Representative's (USTR) 2004 Special 301 Report on Intellectual Property. Nevertheless, Mexico will hope that multinationals will fill the gap left by the removal of a significant but illegal export industry.