Medicine procurement comprises efforts such as managing tenders, defining contract terms, assuring pharmaceutical quality, obtaining competitive pricing structures, and ensuring medicines are listed in the national formulary, according to the WHO. In December 2014, Mexico made advances in meeting these requirements, with IMSS completing the largest consolidated purchase in the history of the Mexican public system. The institution reported savings of MX$4.6 billion (US$30 million) due to a decrease in prices compared to the previous year. An estimated MX$51 billion (US$340 million) were invested in medicines and medical supplies for 2015, MX$8 billion (US$533 million) more than in 2014, benefitting more than 90 million affiliates. The success of this process relied on an inter-institutional collaboration led by IMSS in which the number of participants involved increased from 14 to 42, including IMSS, ISSSTE, PEMEX, SEDENA, SEMAR, all 21 national institutes of health, and 16 federal states. This purchase included 14 tenders comprising more than 1,900 different drugs and wound care supplies, and a volume that rose from 1.3 billion in 2014 to 1.5 billion units this year. Financial savings from generics and wound care supplies were estimated to stand at MX$3.9 billion (US$260 million) while MX$620 million (US$ 41 million) were saved from the purchase of innovative medicines.

The authenticity of all sanitary registrations was verified through a collaborative agreement with COFEPRIS, while Transparencia Mexicana A.C. guaranteed a transparent process. In addition, 20 meetings were held between CANIFARMA, the National Chamber of Transforming Industry (CANACINTRA) and the National Association of Health Supplies Distributors (ANDIS) to expedite the process and provide sufficient information to interested parties. In order to improve competitiveness, IMSS signed an agreement with the Federal Economic Competition Commission (COFECE) to design more competitive acquisition models in which the number of products submitted into the tender process increased, generating savings of MX$1.2 billion (US$80 million). Additionally, a more competitive price point was achieved by purchasing 80% of each medicine from the lowest bidder and 20% from the second lowest, contrasting to the 60/40 model employed in 2014.

The combination of these factors represented useful opportunities for an increasing number of companies interested in submitting proposals, which grew by 5% this year. The competition opened up for generics too, with the 12 most important distributors decreasing their participation from 81% in 2013 to 72% in 2014 and 58% in 2015. Moreover, the increased participation of SMEs was witnessed by increased participation, from 73 in 2013 to 126 in 2015. According to Social Communications at IMSS, promoting competitiveness in terms of price and quality, guaranteeing transparency throughout the process, budget optimization, and most importantly, ensuring procurement of medicines for the population, collectively have a positive impact on the Mexican economy. More consolidated purchases are expected to take place in the coming years as the health system moves toward universality and integration.

This post is an excerpt of Mexico Health Review 2015, to be released in September 2015. To pre-order your copy click here

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