Interview with Sandra Sánchez y Oldenhage, Director General of PROBIOMED
Q: How has PROBIOMED evolved with the implementation of corporate governance, and what has the company achieved in this respect?
A: We have advanced significantly by having defined processes through which our company objectives are set and pursued in the context of our social, regulatory and market environment. We have identified the distribution of rights and responsibilities among different participants in the corporation, as well as defining the rules and procedures for making decisions in our corporate affairs. We have delineated and implemented the right policies, procedures, levels of authority, and the organization we need based on our mission, vision, and values. This goes hand in hand with balancing the interests of key stakeholders, such as the shareholders, financers, customers, internal management, and the government; so I would say we have put together a holistic approach to achieve a solid corporate governance. Ultimately, solid management practices include defining responsibilities and accountability, and with proper corporate governance in place, directing and controlling the company is much easier. This is a step we needed to take before aiming for or moving forward in our search of a partner, raising capital or even considering an IPO in the future. In addition, we are working to obtain the Great Place to Work certification which will only strengthen our market position and partner of choice capabilities.
Q: How will the right partner impact your competitive position in today’s global biosimilar environment?
A: We are interested in creating partnerships locally or internationally, yet we are not only focused on attracting capital but on choosing the right partner. This is related to the vision and the place where we want to be, as well as today’s business environment. A few years ago, mainly Chinese and Indian companies participated in the biosimilar market, but today major pharmaceutical firms are also entering. PROBIOMED has a business model whereby it invests 20% of its sales in R&D, the same level of investment as big pharma companies and our vertical integration in the biotechnology arena makes us rely on a competitive advantage in Mexico that no other company has. Having the right partner would help us to accelerate time to market which would allow us to hold a stronger position among actual and future incumbents. For years we have relied on one sole team fully dedicated to developing new biosimilar products one after the other, with no real pressure on time to market as there were not enough players in the market. Today, this has changed significantly, making it difficult to stay on top of the game unless we further invest in R&D and develop biosimilars in parallel and be first or second to market in order to actually reap the benefits of that target segment. So finding the right partner and raising capital will definitely accelerate this process and help improve capabilities to develop more products in parallel like big pharma does.
Q: To what extent has biosimilar characterization progressed in Mexico in terms of infrastructure capabilities?
A: The development of infrastructure for biosimilar development (i.e. characterization studies to give an example), has not advanced in Mexico at the speed the regulation has increased and become more demanding. This is understandable as the biosimilar market is just starting to be developed more prominently. The new regulation just came into effect on February 2015. PROBIOMED has had to develop state of the art analytical techniques (orthogonal analytical techniques), some of them even published in scientific journals, given the embryonic infrastructure available in Mexico across the R&D chain of biosimilar development. Most of the analyses have been conducted in-house with proprietary methods, which are in line and have been validated to comply with NOM 257 (new regulation) standards and requirements. Characterization has been performed in collaboration with Mexican Universities and Academia, as well as with world renowned scientists and institutions that have been endorsed by COFEPRIS for such purposes.
Q: How advanced is PROBIOMED in ensuring further grasping the biosimilar opportunity in Mexico and opening new markets to become a global company?
A: Considering the demographic transition Mexico is facing along with the rest of the world, there is no budget that can cover innovative treatments for chronic diseases without investing in biosimilars, and the only way to achieve this is through coexistence. Institutions should be able to buy biosimilars for any product for which the patent has expired. An example of this in Mexico can be attested with erythropoietin; a drug for the treatment of anemia in patients undergoing chemotherapy or dialysis. Before undergoing patent expiration, the innovative drug was only available to treat 3,500 patients given its high cost; upon expiration (2001), biosimilars entered the market and dropped the price 90% making it accessible for 80,000 patients today at a lower cost. Savings add up MX$7.5 billion so far, which equates to ten regional hospitals with 250 beds each, 10,000 ambulances or 122 clinics with ten consultation offices each. Those savings could be invested in infrastructure or in innovation medicines. This is the value proposition of biosimilars. PROBIOMED is dedicated to the development and commercialization of biosimilars that can offer value through unquestionable quality and access to affordable medicines. In order to accomplish this: we have to be extremely responsible in the way we invest and demonstrate quality of our products. Moving forward, the better we comply with the regulation, the faster we can enter other markets, and with either one-way recognition or mutual recognition agreements between regulatory agencies, it will be easier to take our 16 biosimilars to other countries; Latin America as our natural and main entry point
Q: How does fragmentation of Mexico’s healthcare system prevent patients from benefiting from high specialty drugs?
A: There are no clear or harmonized processes and policies for budget and resource allocation across public institutions. For example, the budget for Seguro Popular received per state depends on the size of the population covered and not on disease incidence, prevalence, or healthcare needs. Also the budgets allocated to each state are not subject to supervision or expenditure report back. States have had the discretionary decision where to invest and often funds are devoted to other administrative areas and / or other activities rather than healthcare or medicines. Again, there is no real accountability, tracking or control of the resources. The intent today, or at least where the debate is at for now, is to centralize Seguro Popular resources and manage this process to guarantee transparency. Moreover, I believe Mexico should have just one healthcare system; of course, “easier said than done”. However, this is a proposal that has been discussed for many years with an abundance of political will but no real progress has been done. It is complicated by all the fragments of the healthcare system – we have the Military, the Navy, PEMEX, IMSS, ISSSTE, 32 states, etc. among other factors which makes it nearly impossible for all stakeholders to agree and to make it happen.
This is an excerpt of an interview to be featured in Mexico Health Review 2016. For more information please visit http://mexicohealthreview.com
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