Mercosur Trade Bloc Outlines Pharma Potential

According to local industry sources, Mercosur, the South American trade bloc in which Brazil is the largest economy, presents a good opportunity for US drugmakers. At a recent drug law conference in the US, a Rio de Janeiro-based speaker highlighted the fact that Latin America's pharmaceutical market has doubled since 1994 to more than US$40bn. Mexico is the region's largest market, accounting for 32% of the total, followed by Brazil with 29% and Argentina with 22%.

The claims for the Mercosur market are mainly based on its members' pledge to adopt good manufacturing practices (GMP) guidelines according to World Health Organisation (WHO) principles, particularly regarding inspections of overseas manufacturing facilities and mutual recognition procedures. However, problems remain, especially as Mercosur's drug markets are yet to be fully harmonised, because of below-standard technical development and a lack of cooperation between health authorities on prestige projects. Further, the region's developing status implies that tight regulation is a secondary objective to that of securing foreign investment, with less regard for the quality and nature of that investment.

Specifically in the case of Brazil, current regulatory conditions are likely to disappoint some US producers of high-tech patented drugs. Nevertheless, national drug regulator Anvisa has approved the WHO's GMP rules set out in 1992, and is currently studying implementation of the 2003 draft. The agency has also introduced its own certification scheme for foreign manufacturing facilities, which notably requires payment of fees even if the plant is US FDA certified. Indeed, the agency has been quick to realise the potential of overseas inspections, with frequent visits to suppliers in India in recent months, as the government drives up consumption of generics.