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Informed Leadership

Latam Market Study


Mexico

December, 2016
Goals

• Identify main aspects for doctor’s preferences and rationale for


related products
• Map hospital’s purchasing processes and key stakeholders
• Assess related reimbursement structure and mechanisms
• Develop local stakeholders map
• Make strategic recommendations to accelerate sales

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Project questions

1. For each indication (for example, Percutaneous Angioplasty), what products are utilized? Why do surgeons
utilize product A and not product B? If applicable, why don’t they utilize premium brands?*

a) Possible responses to be explored: Does not know product? Does not have access? Cheaper?
Culture? The hospital only purchases Product A, and not B? (supplier does not offer). Responses will
not be quantified and will be based on qualitative interviews;

2. Which are the hospital ‘entrance doors’ for Bard, and what messages must be conveyed to hospitals?

3. Mapping of applicable private and public reimbursement/funding pathways and, when applicable, specific
tariffs;

4. Overview of local (country-level) public and private reimbursement mechanisms and their relevance for Bard
business;

5. Strategic recommendations for leveraging on existing/potential reimbursement to position products and


accelerate sales;

6. Local clinical and non-clinical stakeholders’ map, including their influence in the selection and purchasing
processes;

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Project timeline

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Products
Products categories Products (summarized) Indications

PICC Power line, non-Power IV Therapy

Implantable Port Power, non-Power Chemotherapy and Antibiotics

Lifestream (covered stent), E-Luminexx,


Stents and Stent Grafts Vascular, Endovascular and Biliary procedures
LifeStent

Lutonix (drug-coated Balloon catheter), non-


Angioplasty Vascular and Arterial (exclude Coronary)
coated balloon

Bariatric, Colorectal, General, Plastic,


Meshes, Permafix/Sorbafix, XenMatrix, Thoracic, Trauma, Hernia, Neurosurgeries
Surgical Repair (Davol)
Sealants, Hemostatics (incl. spine), Oral & Maxillofacial Surgery
surgeries – Laparoscopic and Open

Priority products as indicated by Bard


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Recommendations

www.m-brain.com 6
SWOT Analysis – Market Access Perspective
MEXICO

Strengths Weaknesses
•HTA gov bodies with high level laws • The main HTA gov. body (CENETEC) that attends
regulations device needs, nowadays hasn´t decision power
•DI with strong clinical evidence into the inclusion process
•Increased National Devices Manufacturing • Even when the device has been included yet at
process formulary, purchases happen more through 3rd
•Strong relationship with “Integrators” (3rd channels than directly sales. In this sense, even
channels in order to get purchases even without inclusion is not mandatory
healthcare code)

Opportunities Threats
• Value payments more than fee for services • Cost containment issues (expected
purchasing based on unit cost) unprecedented cutting costs at healthcare
• Increase awareness on clinicians around national budget 2017)
clinical/economic benefits from technologies
(devices)
• Oncology innovation treatments will decrease
its usage due to unethical price/effectiveness
ratio

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Traditional approach

Bard

Reactive approach Negotiation on price

Distributor/Integrator MoH/subsystems/hospitals

Focus on reducing cost


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How to bring value
Engage with KDM, stakeholders early and educate them on new access
schemes, thus facilitating the reimbursement negotiation and
potential approvals
What Bard should avoid doing What Bard should do: show value
Focus on device, centre only on approvals Re-design new approaches to demonstrate a payment
at “Cuadro Basico” based on value supported by outcomes reached

Reactive Negotiation Engage Help them to


approach on price early understand a value
payment

Stakeholders
Payer Hospital KDM
& integrators
Focus on Facilitated
reducing cost relationship

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Approaching Mexican Private Payers

• Avoid discussion around direct savings within or exclusively from the


insurance company side
• Leverage the discussion in a “win-win” strategy (manufacturer-insurance
company and/or insurance company/patient)
• Explore and include innovative entry agreements into the private
sector (bundle payments)
• Opportunity: IT and tracking health information systems into the
private sector could bring some valuable variables in a “value
payment” strategy

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Opportunities – Early adopters of Technologies

• Engage with Insurance Companies


–Primary focus on Value, not on Cost
–Value payments
–Outcomes-based payments
–Clinical pilot programs linked to business models

• Map key identified Payers within target hospitals


–Negotiate with Leader Audit teams inside each Premium Hospital

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Helping Payers and Providers

• Align each device with those ideally patient population


–Medical inclusion criteria and/or Clinical Practice Guidelines
–International Pragmatic examples may be used
• Biggest concern of Payers: avoid mass approval of high-cost technologies
through cost-containment methodologies applied by the own institution and
helped by the manufacturer
• Develop Budget Impact Models landing in niche pop

• Be prepared to negotiate technologies in pre-approved “packages”,


value payment methodologies

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Opportunities: create new channels with
integrators / states

Engage with distributors • Primary focus on price negotiation and thereafter include value
(integrators) payment discussion

Engage with states • Primary focus to get include it into a portfolio service, which in turn will
be provided by Bard or integrator

• Negotiate with Audit teams inside each State Representative from


Re-discover existing
Seguro Popular, to push specific purchases based more on clinical
purchase channels at needs. At the end Bard must assure an inverse reimbursement to be
Seguro Popular paid from federal to state level. WARNING: since 2017 the vast majority
of budget will be constantly tracked by federal level (senior audit of
federation) due to incremental debts acquired previously by gov.states.

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Priority to approach
How to generate value?
Order of priority Their goals Approach
Show clinical and economic benefits
Achieve and expand access of Bard
Public healthcare aligned with business models. Begin
Portfolio based on value payment
system with real world data to generate
methods and patient access schemes
Value based evidence
payments Early engagement with Audit
Insurance
aligned Minimize financial risk, manage costs Committees to demonstrate value
companies
w/business (benefits vs cost)
models. Bard In the very begininng Bard must go
will move with discounts or aggressive
gradually to new Get joint ventures to offer the vast proposal versus competitors to be
commercial Integrators majority of the pipeline and mature considered into the Integrator
schemes devices of Bard. portfolio. After this, Bard must
redesign approach w/integrator to
push a “win-win” strategy

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Short-term opportunities
Direct engagement with Integrators and
Private insurance companies
• Bard is effectively promoting its premium technologies to the market
• However, the integrator still have almost total control into the devices
selection without transparency to open and balanced market share between
competitors.
• Bard must directly push innovative strategies with government sector in order
to align and help integrator and distributors to engage and increase
purchases, to configure out better scenarios that balanced the market
• Manufacturers and/or DI is not aligned with insurers needs neither patients
perspective
• Partnering with hospitals and indirectly with patients to approach package payments based on
value and avoid those practices like fee for service
• Most of the insurances companies are not aware of the clinical neither
economic benefits of Bard products and will decline payment based on price
only
Direct engagement with healthcare gov.
sector and interinstitutional KDM
Goal
• Achieve positive coverage decision (i.e. approvals) from interinstitutional formularies (IMSS, ISSSTE)
and more important get the first per patient purchase to leverage central decisions to increase
affordability coverage – increase reimbursement

Tasks
• Establish contacts and schedule meetings with KDM to leverage value payment methods (trainings
around these innovative strategies)
• Present products and economic benefits considering institutional perspectives
• Ideally, estimates must be calculated based on real world data or at least w/local inputs
• Possibly, in the near future get negotiations through prices negotiation commission
• Get alliances with integrators to maintain purchases targets . Bard must keep in mind that integrator
approach won’t be untenable

Requirements
• Offer trainings, round tables and top discussions with KDM around market entry agreements

Timeline – intermediate
• Expected 12 – 24 months
Strengthen relationship with healthcare
secretariats at states
Goal
• Increase or create new commercial agreements with states or municipalities through identification of
those states with decentralized public institutions with local budget and historical purchases destined
to get innovations (e.g. through Seguro Popular reimbursement-CAUSES-Appendix I based on ICD
classifications that includes devices into the description)

Tasks
• Create or strength relationship with key stakeholder at each state or municipality
• Use traditional commercial channels to get purchases at each state
• Train sales forces around the pathways to get purchases from Seguro Popular reimbursement
• Get aid or contract 3rd key player to offer same trainings, but offered to clinicians to avoid conflict of
interests

Requirements
• High level knowledge from our sales forces and strong confidence on those 3rd key players

Timeline – intermediate
• Expected 12 to 36 months for approvals
Mapping and engaging
with payers

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1. Mapping payers

1. Target healthcare subsystems

1. IMSS and ISSSTE

2. Seguro Popular through CAUSES and catastrophic funding expenses

3. Pemex, Army and navy

2. If possible, list KDM with highest number of negative decisions for Bard

 General Health Council and IMSS

3. Prioritize IMSS and decentralized institutions, then private healthcare sector

 Healthcare subsystems are more prone to adopting high-quality products through subrogate services contracts

4. Prepare list with 10-15 target KDMs:

1. Medical area (AECAT area) and finance division (Coordination Unit of finance planning) at IMSS.

2. Infrastructure division (which oversight drug and equipment areas) and medical management at ISSSTE

3. Medical management and risk administration area at Seguro Popular.

1. In order to include some International Classification of Disease to indirecty get coverage of Bard products, Bard must be aware of inclusion dates
every year to submit on time.

2. Aditionally get in touch with RESPSS (State representative of Seguro Popular)

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2. Engaging with Payers

• Existing network of contacts


 Meet with high-level executives of KDM
 Clarify role of products with pathway of care (“protocolo clínico de tratamento”:
if a patient meets some requirements, reimbursement is approved)
 Explain which patients are not indicated for the products

• Lack of contacts with KDM


 Collaborate with external provider to quickly have access to network of payers
(M-Brain can help Bard with this challenge)
 Contact Healthcare/finance/management areas and ask opportunity to explain
the therapies and their benefits
 Remain available to clarify questions related to the use of the technology
 If possible, present products on a technical non-commercial perspective

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3. Demonstrating Value for KDM

• All healthcare subsystems focus on controlling the use of


technologies and their associated cost
 Not necessarily “reducing” cost of treatments, but it is preferable

• Biggest concerns:
 Lack of cost & outcomes data from hospitals (i.e. “I do not know exactly
how much this procedure costs”)
 Hospitals may extend use of high-cost materials to a niche patients pop

• Time-horizon
 Due to Budget control and professional evaluations, KDM focus on
benefits generated within 12 – 24 months

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4. Opportunities at healthcare subsystems

• Subsystems are the only payers in MX interested in both


traditional and innovative proposal or schemes
• Opportunity:
 value payments / innovative prices schemes
 Subrogate services
 Integrators channel purchases

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Recommendations by
product

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Product ‘preference’ map*

Bard category Most mentioned brands Rational for brands


Decision is based on monthly consumptions
PICC “Several” into the hospitals, at the end tenders will
be linked to previous request
Concerns about price, which in turn
support purchases of traditional
Port B.Braun, Smiths Medical
approaches (e.g. catheters + selfcare
education)
Medtronic, Boston Scientific, Vast majority of purchases are linked to
Stent/Stent Graft Terumo integrators decisions
Medtronic, Boston Scientific, Recently Healthcare public sector began to
Angioplasty Bard use PTA in some specific disease as SoC
Brands are selected more on previous
Meshes J&J, Medtronic, B.Braun, Bard experiences, in this sense J&J has an
advantage

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PICC

Benefits

Recommendations

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Port

• Different profiles, sizes/material


Benefits
• Radiopacity (relative inability of electromagnetic
radiation, notably X-ray, to pass through the material)
• Power Port: power injectable with higher max flow rate,
may be used with contrast agent*

• Doctors are usually reluctant to inject contrast agents in


Recommendations
ports
• Position as high-quality products for chemotherapy in
severe patients who would not be indicated for several port
placements

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Stent and Stent graft

Benefits

Recommendations

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Balloon

• The drug-coated balloon does not require the use of a


Benefits
metal stent
• It is more resistant than the stent (more mechanical
strength to unclog the veins/arteries)

• Create value propositions through traditional


Recommendations
approaches like CEA, BIA
• Besides link these tools with business models and RWE
studies

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Meshes

• Extensive portfolio
Benefits
• Premium products may be in contact with viscera

• Position premium products for patients with co-morbidities,


Recommendations
which are more prone to have hernias and recurrences
(economic message for Payers)
• Hiatal Hernia have higher rates of reimbursement
• Focus on laparoscopic procedures (highest
reimbursement)
• Avoid focusing on fixators, which require different surgical
techniques from most competitors’ products
• Apply for specific product reimbursement/approval with
payers

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Matrices

Benefits

Recommendations

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Sealants and Hemostats

Benefits

Recommendations

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Purchasing
Case Examples

www.m-brain.com 32
Stakeholders mapping
MEXICO

Level of Influence Level of Influence


Type Stakeholder Needs and goals
on purchasing on selection
Quality of clinical
Medical Director & High, aligned with
High evidence, cost
Director Hospital Administration
containment issues

Nursing staff Low Low Efficiency


Clinical
Medium, must convince
Hospital Administration Quality of clinical
Surgeon Team and Medical Director,
High
evidence, effectiveness
Purchasing Committee
High, negotiations with
Hospital Payers (as first option) Medium, defines choice Manage costs within
Administrator and Manufacturers (2nd of products budget
Economic option)

High, for high-cost High, for high-cost


Auditor (Health Plan) materials materials
Reduce costs

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Interview considerations

• The scope of the interviews was to collect qualitative information and should
not be understood as a significant representation of the overall market
• Bard’s identity was not disclosed in connection with the project to any third
party preceding or during the project
• Stakeholders are identified only when there was an authorization for such,
otherwise they are referred to in generic terms

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Hospital that serves Public System (The case of IMSS)

Tender happen at midyear, in the previous year


Budget limit, IMSS performed a market research to identify needs in order to project
quantities required of healthcare supplies, drugs, devices, services (integrated)
set by local If the provisions purchased do not accomplish healthcare needs,
Buying then the healthcare institution must ask an extraordinary purchase in order to
government fill out the gap.

Economic Every year, Economic Analysis Unit alongside MoH and the main healthcare subsystems
convene to the pharma industries to negotiate prices, specifically price from those high
Analysis Unit cost drugs for (e.g. target therapies). In this sense, devices are not discussed into the price
alongside Secretary of health negotiation yet.
and the main healthcare • Probably next year will begin to convene device industry to reach out the first
subsystem agreements around high cost devices (agenda 2017)

Nowadays a key player has been working between healthcare institution and the
Intermediary manufacturer/device industry:
INTEGRATOR. The integrator (e.g. VitalMex, Medicus, Selecciones Médicas) offer
Pricing key player a service that cover a disease through medical and/or surgical approach.
The coverage include pharmacotherapy, surgical procedures including
(between healthcare institution
and the manufacturer/device
devices
industry) Even when the device hasn´t been accepted at the national formulary, the
integrator could push the purchase made by the IMSS.

The hospital submit to IMSS


After own Rector and financing agent
Reimbursement
Procedure the proper evidence
procedure for reimbursement.
of

In-depth interview – Local Stake Holders and regulatory experts


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Hospital that serves Public System (The case of IMSS)
Specific Medical Devices overview

Specific devices like :


1. Catheters used for end stage renal
disease
2. Patients ports to be used at chemo
3. Mesh for hernia repair
4. Balloons for Angioplasty

The institution that follow a tender


process, do not have a special basket
destined (for example) to
cardiovascular surgery or
gastrointestinal procedures. Every
and each supplies will be covered,
purchased and finally reimbursed
through the consolidated purchase
In-depth interview – Local Stake Holders and regulatory experts
Hospital that covers Public System
(The case of ISSSTE, Army, Navy, PEMEX Oil Company)

ISSSTE, Army, Navy, PEMEX Oil Company performed alongside IMSS a market
Budget limit, research to identify needs in order to project quantities required of healthcare
supplies, drugs, devices, services (integrated)
Buying
set by local • But, even when they follow IMSS rules, the vast majority of the times they
government could purchase device without following consolidated process.

Economic Analysis Unit alongside Secretary of health and the main subsystems (ISSSTE,
Economic Army, Navy, PEMEX Oil )Company
Analysis Unit • Convene to the pharma industries to negotiate prices, specifically price from those
high cost drugs for (e.g. target therapies). In this sense, devices are not discussed into
alongside Secretary of health
the price negotiation yet.
and the main healthcare
subsystem • high cost devices negotiation is on next year agenda. (2017)

Intermediary
INTEGRATOR: The figure of integrator does not have much impact as it has into
Pricing key player the IMSS. In this sense, manufacturer could made commercial agreements
(between healthcare institution directly with these institutions
and the manufacturer/device
industry)

The hospital submit to his own Rector


After and financing agent the evidence of
Reimbursement the procedure to reimbursement.
Procedure

In-depth interview – Local Stake Holders and regulatory experts

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Hospital that serves Public System (The case of ISSSTE, Army, Navy, PEMEX Oil Company)
Specific Medical Devices overview

Specific devices like :


1. Catheters used for end stage renal
disease
2. Patients ports to be used at chemo
3. Mesh for hernia repair
4. Balloons for Angioplasty

The institution that follow a tender process, do not have a special basket
destined (for example) to cardiovascular surgery or gastrointestinal procedures.
Every and each supplies will be covered, purchased and finally reimbursed
through the consolidated purchase
These institutions could purchase these devices even when it does not have
healthcare code.
In-depth interview – Local Stake Holders and regulatory experts
Hospital that covers Public System- Civil hospitals state healthcare institutions
(Special case - ISSEMyM, ISSSTECH, ISSTECALI)

Budget limit,
Buying
set by local
government To Purchase healthcare supplies directly to
distributors, manufacturers or integrators
Economic without involve into the tender process
Analysis Unit
alongside Secretary of health
and the main heallhcare
subsystem

Intermediary Economic Analysis Unit alongside Secretary of health and the main subsystems
(ISSSTE, Army, Navy, PEMEX Oil )Company
Pricing key player • Convene to the pharma industries to negotiate prices, specifically price from
those high cost drugs for (e.g. Target therapies). In this sense, devices are not
(between healthcare institution discussed into the price negotiation yet.
and the manufacturer/device
industry) • high cost devices negotiation is on next year agenda. (2017)

The hospital submit to his own


After Rector and financing agent the
evidence of the procedure to
Reimbursement
Procedure reimbursement.

In-depth interview – Local Stake Holders and regulatory experts

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National Institutes and Hospitals of the Secretary of Health
The case of National Institutes of Health and High Specialty Hospitals

• CAUSES cover around 300 diseases and FPGC cover 61


Coverage Budget limit, set by catastrophic diseases.
local government •Sometimes NIH and HSH could purchases some health technologies, but
it is still an exception

Hospital buys the


material to
Pricing DI/distributor in the
•Price is Negotiated previously with national
government
CAUSEs Or FPCGC list
price
• Hospital will ask for the reimbursement to
Seguro Popular, in the same sense, when the
patient is diagnosed with one of the 61
catastrophic diseases.
• it's a kind of reversal reimbursement.
After Procedure • WARNING: nowadays Gov. Federation Audit
Reimbursement
Body has begun audits with all states to
describe and identify real debt for each
state. Implications: 2017-18 will move to
new reimbursement schemes to reduce
corruption into the budget administrations

In-depth interview – Local Stake Holders and regulatory experts


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National Institutes and Hospitals of the Secretary of Health
The case of National Institutes of Health and High Specialty Hospitals.
Special considerations related to CAUSES – FPCGC and innovations use

CAUSES cover around 300 diseases


FPCGC cover 61 catastrophic diseases
included some:
( cancers, lysosomal diseases, myocardial infarct,
etc...)

Innovations
Coverage

CAUSES or FPGC cover some devices use innovation through


included at Appendix I, specifically it covers research projects
around no more than 15 devices. funded by companies the deputy ministry of health
Either CAUSES or FPGC cover disease not through its areas follow healthcare
only considering the appendix I, besides priorities, for example obesity and
considering the ICD classification diabetes control.
“In this sense, some diseases have ICD that Into this “umbrella issue” some
healthcare facilitates could get
cover or included into the ICD concept some
coverage and innovations
devices”
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Private Sector -Through Health Insurance Companies. (The more common)

•HIC. approves after negotiate prices with hospital and MDT/distributor (usually all have previously
Health listing procedures or products list)
•The negotiation will be individually and is based around each device
Pricing Insurance •HIC has its own physician networking
• Probably in the next years we are going to move from fee for service to a new kind of payment based on a package of
Companies services covered through capita. (private sector has been recognized the utility of Innovative price models or market entry
agreements)

Physician of These physician must align with the drug/device


the HIC basket previously approved by the insurance
company.
network otherwise the patient will have an out-of-pocket
expense.

After patient Hospital present the bill to health


insurance that reimburse the
leaves the hospital according the
Reimbursement
institution bill/negotiated price

In-depth interview – Local Stake Holders and regulatory experts

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Healthcare System at México
Complexity due to its
subsystems

www.m-brain.com 43
Country profile
Total population (2015) 127,017,000
Mexico
Gross national income per
capita (PPP international $, 16
2013)
Life expectancy at birth m/f
74/80
(years, 2015)
Probability of dying under five not available
(per 1 000 live births, 0)
Probability of dying between
15 and 60 years m/f (per 1 000 174/93
population, 2013)
Total expenditure on health
1,122
per capita (Intl $, 2014)
Total expenditure on health as
6.3
% of GDP (2014)

Global Health Observatory. WHO Country profile 2016/World Bank Group

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Mexico Health System Organization
Sector Public
Private
Social Security Secretary of Health, SESA

Federal State
Funds Government Employers' workers'
government
contribution contribution government Individuals Employers
contribution contribution contribution

Seguro
Popular
(Universal Health Care)

Buyers
IMSS ISSSTE
Government workers security
Insurance Companies

(Mexican Institute of Secretary of defense


Secretary of
Secretary of Navy
Social security) Pemex Oil Company health and IMSS
oportunidades
SESA
Hospitals, clinics and physicians of these Hospitals and Hospitals and
clinics of these clinics of this Private providers
Providers institutions institutions program

Formal Self-employed, informal


Users Families of Population with avility
sector Retired workers and the
workers to pay
workers unemployed

Modified from The health system of Mexico. Salud Publica Mex 2011;53 suppl 2:S220-S232.

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Healthcare System Mexico

PBI

CAUSES Formularies or catalogues: open, closed or


CBCISS* Purchases could be (Universal Drug/Devices/supplies Catalogue at Seguro mixed
undertaken w or w/o Popular)
CBCISS FPGC
(Funding vs Catastrophic Expenses)
Seguro Médico Siglo XXI (Newborns insurance)

CBCISS * National Formulary from Healthcare Sector

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Healthcare System in Mexico

The Healthcare System in Mexico


Ministry of Health
Public Private
The public sector includes social security institutions as
follows: Private sector provides services to people
“Instituto Mexicano del Seguro Social (IMSS*)” “Instituto de who is able to pay for health services with
Seguridad y Servicios Sociales de los Trabajadores del Estado payment capacity, under insurance
(ISSSTE*)” programs available through insurers
“Petróleos Mexicanos (PEMEX*)”
“Secretaría de la Defensa Nacional (SEDENA*)/Army”
Secretaría de Marina (SEMAR*)/Navy, and others. that
provide services to workers in the formal sector of the
economy.
The other public institution that provide services to the
population without social security, which include the “Seguro
Popular de Salud (SPS)”, “Secretaría de Salud (SSA*)”, the
“Servicios Estatales de Salud (SESA*)” ant the health national
program “IMSS-Oportunidades (IMSS-O*)”.

Sources: Constitution Article 196; ANS September 2016 (latest available data)
MX payers mapping
Coverage & reimbursement

MX Pop 122
million
Federal Commission for the Protection against Sanitary
Risk (COFEPRIS)
influences Public and Private healthcare
• The Federal Commission for the Protection against Sanitary Risk (COFEPRIS) is currently experiencing a
significant backlog of registrations and the review timelines for registrations and administrative changes
remain unclear.
• Premarket controls include a three-tier, risk-based classification system. Devices are also classified according
to usage category.
• The rules for classification are based on EU rules with some modifications. The classification system drives
the premarket review process.
• Statutory review times are short, with review periods of 30, 35 and 60 days specified for Class I, II and III
devices, respectively.
• Actual review periods are considerably longer and currently range from two to 12 months.
• No local GMP standards exist but a quality management system certificate from the country of origin is
required for imported devices.
• COFEPRIS maintains information regarding manufacturers, market representatives, importers and
distributors.
• Post market controls currently include adverse event reporting, tracking and recalls.
• COFEPRIS is authorized to take samples marketed products and conduct testing for compliance purposes.1

http://www.gob.mx/cofepris/
Diario Oficial de la Federación, 17 de Abril del 2009. Ley General De Salud, Titulo Decimo Septimo,
Vigilancia Sanitaria, Capitulo Unico, Artículo 401 Bis.
Licensing process of medical devices in Mexico(Summary)

Regulatory agency COFEPRIS

Classification of medical devices Class I, II, and III

Safety, quality, and efficacy. Comply with the terms of local


factory standards. Provision of information about technical
Essential requirements
specification, lifetime of the devices, storage requirements, and
label and instructions for use

Level of evidence required for approval Not required. Clinical trials for Class II

Publication of regulatory decision and The list of approved items is public, not the process or the
transparency reasons to approve or not approve

Free pricing. Public health subsystem requires competitive


System of pricing
bidding

L. REY-ARES ET AL. EXPERT REVIEW OF MEDICAL DEVICES, 2016

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4 types of Medical Private Payers in
Mexico
• Managed by insurance companies (e.g. VitaMedica, MetLife,
Insurance Zurich), 5% pop (it has been increased exponentially)
• 8 million people

• 5% pop
Out-of-pocket • Private hospitals

• Not-for-profit institutions
Philanthropy • e.g. Red cross hospitals

Hospitals • Angeles Group, Medica Sur, Star Medica


Groups
Source: ANS
Parallel healthcare systems expenditure in drugs,
devices and medical supplies 2004-2020

Current expenditure to 2004-2020 in drugs, devices and medical supplies from the main public entities for healthcare (MXN
pesos)
Year IMSS ISSSTE MoH Seguro Popular TOTAL

Source: Federal Expenditures Budget (2004-13)


Since 2014 data shown is estimated w/mean growth rate to 2020 in 3.5% (based on Mexican Bank estimates), w/exception of
Seguro Popular (annual growth rate from Pop)
Reimbursement

www.m-brain.com 54
Overview of regulatory processes

© 2013 Emergo Group – You are welcome to publish this chart on your website, or copy it for use in presentations or other materials 55
Time lines

* COFEPRIS has authorized certain “third party” companies to conduct registration reviews for Class I, II and III devices. These time frames apply only if you have elected to use a third party to review
your submission.
** Companies which cannot claim “equivalency” and will not be using a third party reviewer are subject to COFEPRIS’s standard review process.

© 2013 Emergo Group – You are welcome to publish this chart on your website, or copy it for use in presentations or other materials 56
Overview of reimbursement processes:
since regulatory approval to reimbursement

Mexican reimbursement channels


Considering since regulatory approval to tender participation (in order to be purchased in at least 70% of the tender
units negotiated)

Regulatory Registry IMSS code (largest HC Seguro Popular


Healthcare Code ISSSTE code
approved system) inclusion

Depends on disease, State resources


(finance), KDM and dossier
1-2 years 6 mo – 1 year 2y 3y prepared by physician, local
ahutorities and their align
w/federal KDM (to push
reimbursement of actual diseases
covered by CAUSES or FPGC)
Purchases at Healthcare Descentralized Institutions (purchases out
of National Formulary coulb be undertaken by SEDENA/Army,
SEMAR/Navy,PEMEX, Descentralized Public Organizations)

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Timelines: reimbursement

National Registry • Subsystem registry and approval

1 year 2 years 3 years 4 years


Mexico 3 6 9 12 15 18 21 24 27 30 33 36 39 42 45 48 51
timelines months months months months months months months months months months months months months months months months months
Subsystem Formularies Availability in
COFEPRIS National Formulary (IMSS, ISSSTE, etc) hospitals

Access timelines for Health care (Focus on medical devices) to be included and reimbursed into the Public sector

58
Strategic analysis of reimbursement

• Mexico (1)
• COFEPRIS (Federal Commission for Protection Against Sanitary
Risks) review and approve new device technologies to deliver a
Regulatory Certificate (which implies not only the device itself,
besides its supplies)
• Registry has a term of 5 years, and the device must meet safety,
quality, and efficacy standards
• Providers, manufacturers establish the market price, however
healthcare public sector acquire devices through tender fixing prices

http://www.cofepris.gob.mx/AS/Documents/RegistroSanitarioMedicamentos/req_dm.pdf
http://www.pwc.com/mx/es/retos-dispositivos-medicos/accesocomercializacion.jhtml
http://www.xcenda.com/Insights-Library/HTA-Quarterly-Archive-Insights-to-Bridge-Science-and-Policy/HTA-Quarterly-Spring-2015/Mexico-Navigatingthe-
Regulatory-Landscape-for-New-Product-Approvals-and-Pricing/.

59
Strategic analysis of reimbursement

• Mexico (2)
• Specific interagency catalog for devices (Cuadro Basico) that
determines which devices can be purchased by the public
subsystem (e.g. IMSS, ISSSTE, PEMEX, etc…)
• Some cases social security institutions could purchase devices not
included yet into the formulary, either directly or through bundled
services at their discretion
• General Health Council regulates “Cuadro Basico”
• Manufacturers, Medical Societies and public institutions could
request inclusions. GHC through its members (each one from the
main healthcare public institutions) decides which include or reject.

http://www.csg.gob.mx/descargas/pdfs/cuadro_basico/Reglamento_CI_CByCISS_05092011.pdf.

60
Strategic analysis of reimbursement

• Mexico (3)
• Every subsystem request an additional submission to robust its own
formulary (most of the times implies re-submit the same package
previously submitted to GHC, but with some prices assumptions
[discounts, IPMs])
• Otherwise, manufacturers could get some purchases through
integrators (e.g. VitalMex offer integral services with a diversity of
devices from the main devices manufacturers into the country)

61
Strategic analysis of reimbursement

• Mexico (4)
• Most of the subsystems get the vast majority of devices through
consolidate annual tender (in the previous year Healthcare gov.
sector made a market research to identify medical needs, supplies,
quantity and prices)
• Tender is leaded by IMSS
• At the middle/end of the FY, IMSS and other institutions could
configure out some extraordinary purchases (e.g. implantable pulse
generators are needed more than the initial estimates, in this sense
extraordinary purchases must happened to cover these needs)

62
Key stakeholders for introduction of
medical technologies in Mexico
HTA users Applications

COFEPRIS Regulatory Approval

CSG National Formulary


National

National Commission Pricing (Economic Analysis Price regulation (for drugs only and potentially for
Unit) devices into the next 3-5 years)

IMSS & ISSSTE (in order to include health


Subsystems technology into its own drug/device formulary);
NIH
Own budget and “Seguro Popular” reimbursement
State

State Health Secretariats; Decentralized Public (nowadays Federation Treasury has been audit
Institutions expenses for those states with incremental debts,
the vast majority of states all across the country)
Hospitals

Hospitals Internal purchasing committees


Coverage process of medical devices in Mexico:
summary.

Key aspects Mexico

National agency responsible for the definition or recommendation Comisión Interinstitucional del Cuadro Básico y Catálogo de
of coverage Insumos del Sector Salud – Seguro popular

Explicit process for the inclusion of new technologies Yes

HTA, EE, budget impact analysis, and Authorization’s reports


Type of information to support decision-making from Consejo de Salubridad General (General Health Council)
Local guidelines for development of HTA and EE Yes
Organizations responsible for undertaking/ CENETEC
Commissioning HTA reports Manufacturer, applicant, and other

Appraisal criteria# Efficacy, safety, cost-effectiveness, budget impact


Specific level of evidence required? No

All stakeholders are involved in the decision-making? No (Public consultation)


Explicit appeal mechanism Yes
The HTA and EE reports are public? No
Transparency of final approval decision Yes
Existence of a formal system of price negotiation Yes
L. REY-ARES ET AL. EXPERT REVIEW OF MEDICAL
64
DEVICES, 2016
Natan Rodeguero
Regional Head Latin America
natan.rodeguero@m-brain.com
+55 11 999-963-518 (São Paulo)

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