# E-DRUG: Generic Drug Policy in Mexico under fire from PhRMA **URL:** https://talk.edrugplus.org/t/e-drug-generic-drug-policy-in-mexico-under-fire-from-phrma/2206 **Category:** e-drug **Created:** [March 2, 1998, 9:38am UTC](https://talk.edrugplus.org/t/e-drug-generic-drug-policy-in-mexico-under-fire-from-phrma/2206 "1998-03-02T09:38:34Z") **Posts on this page:** 1 **Page:** 1
### Author: ![love](https://avatars.discourse-cdn.com/v4/letter/l/dec6dc/32.png) [@love](https://talk.edrugplus.org/u/love) #### Post date: [March 2, 1998, 9:38am UTC](https://talk.edrugplus.org/t/e-drug-generic-drug-policy-in-mexico-under-fire-from-phrma/2206/1 "1998-03-02T09:38:34Z")
E-drug: Generic Drug Policy in Mexico under fire from PhRMA ------------------------------------------------------ Dear E-druggers, Below some PhRMA and Journal of Commerce hysteria regarding Generic Drug policy in Mexico. James Love JOURNAL OF COMMERCE, Monday, March 2, 1998 US drug makers fear generics law in Mexico: Brand-name sales considered at risk BY MARY SUTTER JOURNAL OF COMMERCE SPECIAL MEXICO CITY -- Legislation pending in Mexico for generic drugs could disrupt the sale of trademarked and patented products worth millions of dollars in exports to U.S. pharmaceutical companies. The pharmaceutical companies worry that, absent strict controls and regulations, their investment in research and development will be chipped away by the creation of a generics market in Mexico. The industry estimates it costs between $350 million and $500 million from discovery through development of a new drug. "Our biggest concern is there may exist shortcomings in the implementation of the generics law," said Carlos Garcia, director general of Eli Lilly y Compania de Mexico, subsidiary of the U.S. multinational. "If the necessary controls are not in place at the point of sale, branded products could be affected quite negatively." Rigorous controls are needed with the generics law to ensure that poor quality or dubious products do not slip into the market, and that doctors' orders are respected, Mr. Garcia said. Patent expiration key Generic drugs are like their brand-name counterparts, but they become available to consumers only when the life of the original patent expires. Because they normally are much cheaper -- their production does not involve research and development costs since they are copied from the patent -- their appearance on the market forces brand-name drug makers to slash the price of their own products. U.S. drug makers lose $1 billion annually worldwide from unauthorized copying of their inventions, according to the Washington, D.C., Pharmaceutical Research and Manufacturers of America. "While new drugs are highly expensive and time-consuming to develop, they can often be copied at a small fraction of their development costs," Pharmaceutical Research and Manufacturers of America said. In Mexico, the main problem for U.S. drug exporters is how the generic market will operate. "We want to be sure that these (generic) drugs fulfill the same requirements as we do," said an executive at an international pharmaceutical company. "It's not the generics so much as the conditions under which they are introduced into the market." When Mexico became a partner in the North American Free Trade Agreement, its patent law and rule-making process became subject to harsher scrutiny. Regulations covering generics have been slow in coming, although officials had promised that they would be published by the end of last year. Some aspects of the generics rules were published in February, but the U.S. industry is nervously awaiting the whole package of reforms that will define the market for generics. Eric Hagsater, a board member of the Mexican pharmaceutical association Amiif, insists that Mexico's Health Ministry worked closely with industry representatives to create rules that are acceptable to all sides while preserving the interests and health of the Mexican public. For example, he said, only drugs that are listed in the government registry -- those distributed by public-service and other government organizations -- will be eligible for sale as generics. While drugs on the registry make up about 20% of all pharmaceutical products, they account for more than 50% of sales in Mexico. "The emphasis will be on what is in widest use and not highly specialized medicines," he said. 'Similar' not allowed Mexico will not be allowing "similar" products. The first generics will be interchangeable -- exactly the same as the brand-name drug, just marketed under the generic name. In a key step, expected by mid-March, Mexico will publish a list of those drugs for which generics can be made, along with the procedures manufacturers must follow when applying for a generic to be included in the register. The current complete registry of drugs includes 531 medicines in 776 forms (capsules, tablets, etc.). Under a recently published health regulation, doctors will have to include the generic name of a given drug on prescriptions, as long as the generic is listed in the government registry. Pharmaceutical Research and Manufacturers of America had fought against mandatory inclusion of generic drugs on prescriptions. However, doctors in Mexico can specify a brand-name drug on the prescription, in which case, only that brand-name product may be issued. "What is going to happen here is not what happened in the United States because the U.S. has just one (single) pharmaceutical market," said Mr. Hagsater. "There, the day after the patent expires, several generics are launched in the market and it causes a decline in the price (of the brand-name drug)." Different in Mexico However, in Mexico, the use of brand names to market a generic drug will be strictly prohibited. A company will be able to package a product as "Company X penicillin," for example. But even with the new rules, Mexico still lacks the necessary infrastructure -- such as labs to test equivalency -- for the generic market. So even after the rules are published, it likely will take some time before the market is truly operational, Mr. Hagsater said. Another worrying issue for the U.S. side is the massive presence of the government sector in the drug market. Pharmaceuticals are among the few products still subject to government price controls in Mexico. Pharmaceutical Research and Manufacturers of America estimates that price controls and government manipulation reduce sales by $100 million to $500 million annually. And the market still isn't what it used to be. Mexico's pharmaceutical market -- with total sales last year estimated at $3 billion -- is just crawling back from the economic crisis of 1995-1996. Sales aren't expected to return to 1993 levels until next year. U.S.-made medicines remain priced beyond the reach of most Mexicans. -- Send mail for the `E-Drug' conference to `e-drug@usa.healthnet.org'. Mail administrative requests to `majordomo@usa.healthnet.org'. For additional assistance, send mail to: `owner-e-drug@usa.healthnet.org'.