The General Health Law Regulations for the Control of Production, Investigation and Medicinal Use of Cannabis and its Pharmacological Derivatives recently entered into force, making it possible for individuals and legal entities to engage in activities regarding the production, research and manufacture of raw materials, pharmacological derivatives and medicines derived from cannabis. This represents an important development for these products in Mexico – not to mention new business opportunities.
The Ministry of Health has published an accord which aims to provide a larger number of Mexicans with access to more and better medicines and other health supplies. Among other things, the accord establishes that the Federal Commission for the Protection against Health Risks must make a decision on applications for marketing authorisations of foreign medicines and health supplies within five working days of the applicant's filing of the corresponding documentation.
The Mexican health authorities argue that the use of vaping products constitutes a health risk and promotes tobacco product use by smokers and non-smokers alike. Based on this interpretation, the health authorities have made several attempts to prohibit the sale and marketing of vaping products. Most of these attempts have been challenged by individuals or legal entities engaged in the tobacco industry, with favourable outcomes in the federal courts and the Supreme Court of Justice.
During the COVID-19 pandemic, new technologies such as telemedicine and remote medical services have become even more relevant due to the risks associated with close physical contact in hospitals and other places where COVID-19 sufferers may be present. A new Official Mexican Standard, which was recently published in the Federal Official Gazette, sets out the minimum requirements applicable to infrastructure and equipment required for outpatient medical care facilities.
The regulation of and risks associated with vaping are among the most debated topics among health authorities and industry players worldwide. Mexico is no exception in this regard, as its developing vaping industry is subject to considerable scrutiny and the health authorities are taking a prohibitionist stance; however, this approach is not new.
Technology is developing rapidly and it generally takes the legislature years to catch up. This is particularly true in the healthcare industry, where regulations are struggling to keep up with the development of health-related technology. This situation has put Mexico in a difficult position. On the one hand, health-related technology is widely available to the general population. However, Mexico also faces numerous challenges, as it cannot quickly and efficiently regulate the use of emerging technologies.
It is a basic constitutional principle that no activity or product can be restricted or limited unless a legal provision establishes such restriction or limitation. This principle has resulted in a number of legal gaps regarding products and activities of a technical nature, as Mexican law is rarely as dynamic as technology and innovation. One of the most visible technological advances has been in the software and app arena, particularly with regard to healthcare. This has led to a challenging situation for the health authorities.
The Ministry of Health recently announced that the Federal Commission for the Protection against Sanitary Risk guidelines regarding industrial products with a tetrahydrocannabinol content of less than 1% have been suspended. In addition, all permits granted under the suspended guidelines will be reviewed and new draft regulations will be prepared in coordination with the Ministry of the Interior.
Numerous laws and regulations govern the import and marketing of medicines and medical devices. In addition to purely regulatory and health-related requirements, a number of provisions which govern import procedures and products in general must be observed. Most importantly, parties which intend to market a medicine or medical device in Mexico (whether imported or manufactured domestically) must obtain the corresponding marketing authorisation from the health authorities.
Traditional medicine is still a primary health resource for millions of people who do not have access to so-called 'modern medicine'. However, traditional medicine and knowledge are not covered by the general legal provisions which govern human health or specifically recognised by the Mexican health authorities. In some cases, traditional medicine has even been deemed illegal and attempts have been made to outlaw its practice and promotion.
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.
The Office of the United States Trade Representative recently issued its Special 301 Report. Section I.A.1 of the report, which concerns pharmaceutical and medical device innovation and market access, calls on Mexico to address pharmaceutical and medical device IP-related challenges, lists the steps that it should take in order to open its markets to IP-intensive pharmaceutical products and medical devices and encourages it to recognise the value of innovation in these fields.
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.