Read the Conversation
EF: As the Mexico Lead for Health & Education, what are your key responsibilities in IFC Mexico?
AF: For the past four years, I have been responsible for building our portfolio of investments in Mexico in the health services, pharmaceuticals, and education sectors. My role is to build a sound investment portfolio for IFC while providing value-added financing and advisory services to our clients. Our ultimate goal is for Mexicans to have better access to quality healthcare products and services.
To put that into perspective, IFC is part of the World Bank Group. While the World Bank works with the public sector, IFC focuses on the private sector. We want to increase our volume of investment and advisory services and catalyze other investors. IFC does not work in a vacuum; we want to demonstrate that profitable returns can align with positive impacts, inviting others to join us in making a positive difference.
Today, IFC is one of the largest emerging market healthcare investors with a clear strategy to expand access to quality health products and services for all. In the past 20 years, we have invested approximately $4.5 billion in healthcare services, $4.5 billion in life science and MedTech, and around $3 billion in education, supporting projects focused on access, quality, and inclusion.
EF: Please tell us about the current initiatives or projects led by IFC to promote increased access to quality health products and services in Mexico.
AF: IFC’s proposition is to provide a holistic solution to its client combining advisory services that add value along with patient capital that best fits the needs of a project or company. Along the way, we also open our network to our clients and they can tap into our pool of experts. In Mexico, we are looking for financially sustainable projects with good sponsors and scalable business models. We are also very interested in supporting the healthcare workforce through medical education, as the country lacks all types of healthcare workers.
One global initiative that we have rolled out in Mexico is digitalization. Even before the pandemic, we could observe that many of our clients were having difficulty with how to go about their digital transformation, whether they were hospitals or pharmaceutical companies. As a result, we developed two advisory programs called DigiHealth and DigiPharma to assist companies in planning, financing and implementing their digitalization process. It’s a four part process whereby we conduct a diagnostic to assess the current digital maturity of the company, then co-develop a strategy based on the business priority, and third, create an action plan to realize the business objectives. The fourth step is the financing support.
Digitalization needs to be at the service of a business objective. In healthcare services, it is more than just teleconsultation. It extends to the entire patient, clinician and staff experience to improving operations. It can support the traditional patient flow (admission, diagnosis, treatment, discharge) but also the support functions (procurement, finance, billing and collection).
EF: In 2024, IFC will host its Global Education Conference in Mexico. Could you tell us more about this event and its relevance to Mexico's healthcare system?
AF: This event is held every two years, as we alternate between healthcare and education conferences. For our Education Conference, we are excited to receive around 450 attendees, global decision-makers and investors from all regions. This is our first Education Conference hosted in Latin America. The conference will include a session on medical education as we have identified the training and upskilling of healthcare professionals as an urgent global topic for building resilient healthcare systems.
This event offers a valuable opportunity for our global community of decision-makers in education to discuss and explore concerns and solutions with regard to new demands on education systems and how to ensure students have the right skills for good jobs. The role of technology and digitalization will be a central theme of the event, and we hope to generate valuable exchanges of best practices and solutions among attendees, fostering cross-regional collaboration.
EF: What are the three pillars for constructing a sustainable healthcare system?
AF: There is no one-size-fits-all approach. You cannot take the Netherlands model and apply it to Mexico. Every country has a legacy healthcare system, and we have to understand each system as it is. There is no cookie-cutter approach. Of course, enhancing an existing system poses considerable challenges compared to starting anew. However, we must work around it and try to improve it as much as possible with the right mechanisms, incentives, and designs.
The first pillar is to build better public-private collaboration to reduce fragmentation of information and care pathways as well as improve efficiency. The second is a system that needs a well-trained and motivated workforce in sufficient numbers. The third is, that within the context of limited fiscal resources, we need distinct payment mechanisms. While the low-income population requires public payment solutions, private insurance for those who can afford can help ensure the system's performance and sustainability.
EF: What improvements could attract more investment to Mexico for building a resilient health infrastructure?
AF: Mexico is already an excellent investment destination for Health investing. We have seen a rise in interest both from local and international actors, thanks to a growing ecosystem of entrepreneurs, investors and financiers. This mix of influx of ideas and projects and financial backing is virtuous for the sector.
On the pharmaceutical side, Mexico is a large market itself and a hub of excellence. The presence of local companies with deep expertise in the sector is an asset. In addition, Mexico is an ideal nearshoring candidate. Logistics-wise, it has a strategic position relative to the United States, and the skilled workforce presents cost-effective advantages compared to many other countries. Given this combination of factors, many international pharmaceutical companies are also eyeing Mexico, whether for exports, acquisitions or local manufacturing.
On the Healthcare services side, the market remains very fragmented and a large portion of the population is unattended or incorrectly attended. This is a large opportunity to improve the quality and efficiency of services. Mexican entrepreneurs are doing their part in this. For example, with diabetes being a prevalent disease in Mexico, IFC has invested in “Clínicas del Azúcar”, a chain of clinics that provides diabetes care all over the country and offers an interesting value proposition on diabetes care and management.
EF: What would you like to celebrate as a major accomplishment during your time working in Mexico?
AF: IFC has accomplished a lot in the last five years. On the investment side, our pharmaceutical portfolio has grown substantially in the country. We have assisted some of our clients in not only consolidating their position in the Mexican market but also in expanding internationally. It is fantastic to see Mexican companies succeeding on a regional and global scale. On the advisory side, we made a significant breakthrough in supporting our clients with their digital transformation through our DigiPharma and DigiHealth programs as well as their quality journey through our IQ-Healthcare program for which we have received excellent feedback.
The second reason to celebrate is that we recently signed a new US$ 43 million financing to one of our long-standing clients, the Universidad Autónoma de Guadalajara, a leading player in medical education, to strengthen their digital and physical infrastructure on their campus. This project showcases IFC’s strategy to support the entire value chain in the health sector.
