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Why now is the right time to invest in Mexican pharma

Friday, March 6th 2020 - 10:48 UTC
Full article
With COVID-19 emerging as a major threat to nations all over the world, biotech companies have been sent scrambling in search of a vaccine. With COVID-19 emerging as a major threat to nations all over the world, biotech companies have been sent scrambling in search of a vaccine.

The spread of the Wuhan Coronavirus or COVID-19 has sent ripples of panic all across the globe. What was thought to be a localized threat in China has quickly grown into an epidemic that has spread into Italy, Iran and South Korea.

Having killed more people than SARs, the World Health Organization (WHO) has admitted that the mortality rate of COVID-19 is higher than was initially thought.

With China being hit hard by the outbreak, many investors that a slowdown of the world’s second largest economy could trigger a cataclysmic global recession. Consequently, investors have been sent scrambling for cover as they desperately try to minimize their risk exposure.

Precious metals such as gold, silver and platinum have all seen an increase in uptake with gold price predictions for the next 5 years set to climb exponentially in response to increased trade.

In the wake of all this chaos and uncertainty, markets worldwide have taken a severe hit with no end in sight. During such times, many would be tempted to button down and ride out the crisis, however there is another way of coping with this crisis.

While pharmaceuticals have long been viewed as a high-risk investment during the best of times, they can actually be quite a compelling investment on the long-term.

In this article, we’ll take a look at why investors need to seriously consider investing in pharma and biotech companies based in South America.

1. The COVID-19 Outbreak

With COVID-19 emerging as a major threat to nations all over the world, biotech companies have been sent scrambling in search of a vaccine. While one would expect the outbreak COVID-19 to be a boon for such companies, the actual situation is quite the contrary.

In the wake of COVID-19 spreading throughout Italy, South Korea and Iran, biotech stocks have taken a major hit. This is because, vaccine manufacturing can be a risky business with companies sometimes struggling to meet economies of scale.

Hence as an investor, now would be an excellent time to snap up biotech stocks in preparation for the release of a vaccine.

However, it should be noted that this is a long-term strategy as some experts have claimed that the release of a true vaccine could take months or even years. By that time, the COVID-19 virus could have mutated into an entirely new strain thus rendering the vaccine worthless.

2. Mexico’s signing of the various Free Trade Agreements

Mexico is a signatory to 12 FTAs with 33 countries that include Japan, Europe, Canada and the United States, whilst also having signed the NAFTA or North American Free Trade Agreement.

These free trade agreements have given Mexico plentiful access to drug markets all over the world as well as both North and Latin America. Having been the destination of choice for American pharmaceuticals for nearly 2 decades, Mexico has been able to position itself as a hub for drug manufacturers.

With the benefit of more competitive pricing and good access to developing drug markets in South America, one would be amiss to not invest in pharmaceutical corporations based in Mexico.

3. The introduction of generic medicines

Under President Vincente Fox’s government in 2000, the Mexican healthcare system has undergone an overhaul with patient’s being granted improved access to anti-cancer drugs and the widespread availability of generic medications. All of which is sure to lead to increased growth of the Mexican pharmaceutical industry.

Furthermore, Indian pharma companies such as Ranbaxy Laboratories and Wockhardt Limited have all begun expanding their presence with these 2 conglomerates spearheading the introduction of generic drugs in Mexico.

With a competent workforce skilled in aspects of drug manufacturing such as process engineering, organic chemistry and organic synthesis, it’s hardly any surprise that Mexico is the destination of choice for many top pharma companies. Just like is the best option to choose the best gambling apps.

Mexico’s pharmaceutical industry is one of the world’s fastest growing and it is uniquely positioned to take full advantage of this.

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