Pharma Manufacturing Booms in Hidalgo, Mexico

Hildalgo had good pharmaceutical infrastructure and supply chain capabilities, but with no foreign investment and global market support, its potential was hampered. Mexico is also favored with large land areas and ports for the expansion of pharmaceutical exchange.

The year 2020 marked the expansion of Hildago’s pharmaceutical market with the collaboration and investment of India’s top pharmaceutical companies. This collaboration attracted many foreign investors and marked the tremendous growth of pharmaceutical production and distribution in Hildago, Mexico.

Geographical Advantages for Pharma Manufacturing In Hidalgo

Mexico holds a large land area of two million square kilometers engulfing deserts in the north, rainforests in the south and east regions, and mountains in the center. Mexico has an extensive coastline which includes the Pacific Ocean towards the west coastline which serves as the largest coastline of Mexico, the Gulf of Mexico towards the east coast, and the Caribbean Sea towards the southeast coast.

This vast land area serves as a good scope for the development of pharmaceutical manufacturing and distribution units whereas the surrounding oceans serve as an advantage for the port development for import and export of pharmaceuticals. The biggest advantage of the US being the northern neighbor of Mexico aids in strengthening the pharmaceutical trade opportunities.

Overview Of Indian Pharmaceutical Collaboration With Mexico:

• In 2020, India’s six top pharmaceutical companies specifically Dr Reddy’s Laboratories, Cadila Pharmaceuticals, Glenmark Pharmaceuticals, Torrent Pharmaceuticals, Hetero Drugs, and Ackerman Pharma signed a memorandum with the State of Hildago in Mexico that aimed for the expansion of the manufacturing and logistics units of these top companies in the Hildago region of Mexico.

• Sun Pharma strengthened its position in the Mexican market by expanding 25% of its remaining stakes, making Sun Pharma de Mexico SA de CV, its separate entity in October 2023.

• October 10, 2022, marked the announcement of the partnership between the Indian pharmaceutical Cipla and Mexican pharma company Birmex for the supply of oncological and retroviral drugs and technology transfer to Birmex for easy availability of these medicines to the Mexican population.

• Indian pharmaceutical exports grew by 67.6%, developing an increased revenue from $55 million to $92 million from April to August 2023.

• Mexico City accounts for the largest number of pharma manufacturing facilities with half of the facilities approved by the EU or the FDA. These facilities include API manufacturing units, injectable and packaging units, etc.

Nearshoring & CMOs Boosts Mexico Pharma:

The Mexican pharmaceutical market is flourishing with the support of the nearshoring of US companies and the establishment of Contract Manufacturing Organizations (CMOs) by foreign companies. After the COVID-19 pandemic issues, the US shifted its manufacturing units closer to the Mexican boundaries to avoid global supply chain issues.

The US established its three-pharma headquarters in Mexico. Many pharmaceuticals in Europe and Canada have developed their manufacturing sites in Mexico. This shows the potential of Mexico for growth in the pharmaceutical sector, attracting more foreign investors to collaborate with CMOs in Mexico.

Challenges And Opportunities:

Some of the factors such as unexpected supply chain disruption, costing pressure, regulatory hurdles, etc. serve as challenges for the development and expansion of the Mexican global pharmaceutical market. However, these challenges are overcome by the wide range of opportunities the Mexican market has such as nearshoring benefits, foreign companies' CMOs, partnerships with foreign pharma brands, an aging population increasing the demand for pharmaceutical products, etc.

Future Impact:

The Mexican pharmaceutical market is expected to become the major pharmaceutical global point for the supply and manufacturing of pharmaceuticals. This will lead to more employment and overall economic growth in Mexico. The pharmaceutical collaborations with the Indian investors will most likely lead to innovations in Mexican pharmaceutical production making Mexico, the leading global supplier across the Latin American market.