Systemic Competitiveness Factors in the Pharma Industry's Productivity and Innovation in Mexico

Abstract

The combination of Total Factor Productivity (TFP) and Systemic Competitiveness (SC) and Focus Groups (FG) approaches has demonstrated the existence of a structural change in the pharmaceutical industry (PhI) in Mexico, that explains the fall in the labor productivity, because of several conditions changes along of its activities. Over the last 20 years, there are multiple factors that have impacted in every link of the PhI's value chain that need to be identified, like the inadequate implementation and practice of regulatory reforms from the public health macro-policies, as well as the lack of industrial meso-policies to promote manufacturing, have induced a significant drop in its generation of gross added value and consequently, an important loss of the Gross Domestic Product (GDP), as the TFP methodology demonstrated. By the use of SC approach, the main factors that determine each of the competitiveness levels were described and how they have impacted the main links of the PhI value chain, such as R&D and production links, with severe consequences in the molecules innovation, manufacturing and employment generation. Based on the FG among several PhI's executives, it was possible to define the main factors that affected PhI's value chain, as well as confirm the TFP and SC findings, that must be used for industrial and sanitary policies that promote its economic growth and its contribution to health national system.