It is well known that the law often struggles to keep up with new products and activities. In many cases, the legal provisions which apply to regulated activities lose their applicability due to the speed with which technology enables parties to operate outside the scope of the law or the jurisdiction of the relevant authorities. This is particularly true for physical research involving humans, as advancements in communication and the transfer of data have significantly broadened the scope of such research.
Although Mexico has some of the most stringent regulations regarding the growth, use and marketing of marijuana, this position has recently changed, as evidenced by the amendments to the General Health Law which permit the health authorities to design and execute public policies regarding the use of pharmacological derivatives of marijuana. However, the question remains as to whether hemp constitutes a narcotic under the General Health Law.
Mexico has some of the most stringent regulations regarding the growth, use and marketing of marijuana and marijuana-based products. Over the past few decades, considerable resources have been devoted to combating all activities relating to psychoactive plants. However, the government's position on the use of marijuana from a medical or pharmaceutical perspective has changed in recent years.
What happens to marketing authorisations (MAs) or sanitary registrations for pharmaceutical and medical devices may be one of the biggest questions to consider before, during and after a merger or acquisition of a legal entity active in the pharmaceutical or medical device industry. Parties undertaking a merger or acquisition which involves the transfer of an MA are advised to undertake a comprehensive analysis beforehand, as bundling the MA with other actual assets could trigger tax issues or exposure.
Although it is common for the parties involved in mergers, acquisitions, asset sales, spin-offs or similar activities in the pharmaceutical, medical device and other health-related industries to treat marketing authorisations as assets which are subject to the general negotiation process, this approach is controversial. If incorrect, an allocation of a monetary value to or a transfer of a marketing authorisation could be considered an invalid act between the relevant individuals or legal entities.
Mexico is the second largest market for the pharmaceutical and medical device industries in Latin America. Thus, as mergers and acquisitions, asset sales, spin-offs and similar activities in the pharmaceutical, medical device and other health-related industries are often global or at least multinational, they often affect companies that operate in Mexico. Although there have been many unfortunate situations where such activities have been delayed or cancelled, this can be avoided.
The Federal Commission for the Protection against Sanitary Risk recently published new guidelines for the authorisation of ad applications regarding prescription and over-the-counter drugs, herbal remedies and homeopathic medicines. As the guidelines include several provisions that appear to be against the General Health Law and the Health Law Regulations on Advertisements, they may give rise to a number of interesting scenarios.
A number of changes to the cannabis legal landscape have taken place in Mexico over the past few weeks. For example, the Federal Commission for the Protection against Sanitary Risk recently published on its website guidelines on the sanitary control of cannabis and cannabis derivatives. Further, the Supreme Court issued its fifth decision granting constitutional protection against the adult use prohibition and Congress was presented with a bill to implement the General Law for Cannabis Control.
The Secretariat of Health recently announced amendments to the General Law on Tobacco Control. The new Title Eight includes Articles 56 and 57, which specifically address crimes relating to tobacco products. The new provisions are particularly relevant for individuals and legal entities engaged in the tobacco industry. Industry players are advised to consider the scope of these amendments and determine how their business operations in Mexico may be affected.
New legal provisions regarding the use of marijuana for medical and industrial purposes were recently published in the Federal Official Gazette and have sparked great interest in the potential development of such products in Mexico. However, the proposed regulations could contravene other federal laws, regulations and standards which explicitly state that marijuana and its derivatives cannot be used as ingredients or raw materials for food, beverages, cosmetics and other products bound for human consumption.