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The medical device industry in Mexico in 2023: A trajectory of growth

by | Jul 3, 2023

According to the document “Knowing the medical device industry,” prepared by the National Institute of Statistics and Geography (INEGI) and the Mexican Association of Innovative Industries of Medical Devices (AMID), three economic activities have been identified in Mexico that reflect the economic behavior of the medical device industry in Mexico.

The first is the manufacture of disposable material for medical use, the second activity is the manufacture of non-electronic equipment for medical, dental, and laboratory use, and the third is the manufacture of non-woven fabrics (compressed).

It is worth mentioning that medical devices not considered in these economic activities are produced in other activities or are imported products.

The study states that, in this way, by the amount of what was produced, the manufacture of disposable material for medical use was the most important activity since the production value was 13.8 billion dollars in 2021, which reflects an increase of 11.1% compared to the previous year, due to the rise in demand for these products due to the COVID-19 pandemic.

In this case, the average annual growth from 2013 to 2021 was 4.2%.

For its part, the manufacture of non-electronic equipment for medical, dental, and laboratory use had a production of 1.8 billion dollars in 2021, with a growth of 2.9% compared to the previous year. Likewise, the average annual growth rate was 6.2% from 2013 to 2021.

Finally, the growth in the manufacture of non-woven fabrics (compressed) was 4.7% from 2020 to 2021. While from 2013 to 2021, this activity grew 1.3% on average each year.

It should be noted that according to the report, production, employment, and wages showed increases in the medical device industry in Mexico or have remained stable in recent years.

“These increases were due to the increase in demand for products from this industry, derived from the COVID-19 pandemic, a situation that contrasts with what happened in most economic activities, which reduced production, employment, and wages in those years,” the report details.

Exports and imports of the medical device industry

The INEGI and AMID report indicates that  2020 exports of medical devices reached 10.7 billion dollars in 2020 and imports 5.24 billion dollars, which generated a surplus of 5.46 billion dollars.

“Mexico exported the vast majority of medical devices to the United States (96.7% of the total) in 2020, a percentage corresponding to 9.6 billion dollars. In addition, the origin of imports of these products was mainly the United States (60.7%) and China (12%); both accumulated 72.7% of the total,” details the document.

Other export destinations were France, China, the United Kingdom, the Netherlands, and Germany. At the same time, Mexico also imported from countries such as Germany, Malaysia, South Korea, Japan, Italy, Ireland, Pakistan, and Taiwan, among others.

It should be noted that, from 2003 to 2020, exports of medical devices grew by an annual average of 8.6% and imports by 7.9%, which caused the surplus balance of the trade balance to increase by a yearly average of 9.4%.

Aerosol therapy devices, respiratory resuscitation devices, and other respiratory therapy devices totaled 9.2 % of total exports.

On the import side, the two fractions that stood out were ozone therapy, oxygen therapy or aerosol therapy devices, respiratory resuscitation devices, and other respiratory therapy devices and diagnostic reagents for the determination of immunological tests utilizing monoclonal antibodies, even in the form of games, which accumulated 8.4% of the total.

Foreign direct investment in the medical device industry in Mexico

Information from Data México states that, in the period from January to September 2022, the Foreign Direct Investment (FDI) of the industrial branch Manufacture of non-electronic equipment and disposable material for medical, dental, and laboratory use, and ophthalmic articles was 126 million dollars.

It should be noted that, from January 1999 to September 2022, the amount of FDI was 1.8 billion dollars.

Likewise, in the first nine months of 2022, the states that received the highest FDI for the medical device industry in Mexico were Chihuahua, with 79.1 million dollars, and the state of Mexico and Baja California, with 12.6 million dollars.

While from January 1999 to September 2022, the states that have received the highest FDI are Chihuahua, with 1.15 billion dollars; Baja California, with 406 million dollars; and Mexico City, with 147 million dollars.

For their part, the leading countries of origin of FDI in the medical device industry in Mexico from January 1999 to September 2022 were the United States, with 54.8 million dollars, Canada, and the Netherlands. Meanwhile, from January 1999 to September 2022, the countries that contributed the most to FDI were the United States with 1.41 billion dollars, Germany with 193 million dollars, and Canada with 105 million dollars.

The medical device industry in Mexico is prominent in several states

Several Mexican states have emerged as leaders in the medical device industry in Mexico. Below are some of the critical states known for their significant contributions to the sector:

  • Baja California: This state, particularly Tijuana, is a prominent hub for medical device manufacturing in Mexico. It hosts many companies involved in the production of medical devices, including orthopedic implants, surgical instruments, and electronic medical equipment.
  • Chihuahua: Chihuahua is another important state for medical device manufacturing. The city of Ciudad Juarez is known for its well-established medical device industry, specializing in areas such as electromechanical devices, dental equipment, and prosthetics.
  • Guanajuato: The state of Guanajuato, particularly the cities of León and Irapuato, has a strong presence in the medical device manufacturing sector. It is known for producing various medical equipment, including diagnostic devices, surgical instruments, and orthopedic implants.
  • Jalisco: Jalisco, with its capital city Guadalajara, is recognized as a critical center for medical device manufacturing in Mexico. The state has a well-developed infrastructure and expertise in various areas, such as ophthalmic devices, cardiovascular devices, and general medical equipment.
  • Nuevo León: The state of Nuevo León, with its industrial city of Monterrey, has a thriving medical device manufacturing sector. It produces various medical devices, including orthopedic implants, surgical instruments, and electromedical equipment.

These states have attracted significant investment in the medical device industry in Mexico due to favorable business environments, skilled labor, proximity to the United States market, and infrastructure support. However, it’s worth noting that medical device manufacturing is not limited to these states, and other regions in Mexico also contribute to the industry.

 

 

 

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