Read the Conversation
EF: In the post-Covid times, executives must deal with complex multi-faced economic and political scenarios; even some big companies are restructuring and reassessing their footprint. How do you visualize 2023; do you see it as a challenge or an opportunity?
HO: I see it as an opportunity to reach more patients. The geopolitical situation is affected by world dynamics, but focusing on reaching more patients has been key to our success over the last couple of years. The professionalized use of our technologies is there for doctors and physicians, and providing opportunities to diagnose patients better and more accurately has been key to our success. We need to take advantage of the environment to spotlight the use of technology for the country's future needs. Extra resources will not magically appear; there won't be more than there are now for the next years. We must invest in technologies to act as enablers, facilitating healthcare systems and benefiting people's health.
EF: What do you strive to achieve as president of AMID? What is on your agenda?
HO: There are several key points on the agenda; the legal recognition of medical devices is important as they act as enablers. The law has recognized medical devices as another element of the main health system. A tender can now require medicine, medical devices, and health consumables, a big change from the past, where we were not grouped with medicine but considered an additional element for the system. Today we are legally recognized and very happy to be so. The future of health will be based on enabling medical technologies, which the system can leverage to accelerate patients' health. As an important stakeholder in the ecosystem, we are building the medical device industry to improve people's health for the future, and it is one of our main drivers.
EF: Mexico is home to Medtronic's third-biggest manufacturing facility after Connecticut and Puerto Rico. What are the advantages of having a local manufacturing footprint in Mexico? Are you leveraging the nearshoring potential?
HO: For us, Mexico is already a really important hub. We have a significant footprint and over 12 thousand employees, and our first responsibility is to provide access to our products for our people. I am happy to say we are working and improving on this challenge. We provide work for many families in Mexico and are proud of doing so. If we continue this trend, Mexico will become an important hub due to investment and nurturing. We are not waiting on the nearshoring possibilities. Medtronic has invested in Mexico for fifty years, with recent significant investments to improve our local capabilities and make us a relevant player. The future is a reality today for Medtronic; we have just inaugurated a new area in a manufacturing site in Costa Rica, showcasing our growth in the region.
In terms of the industry, the next two years are critical to developing opportunities to continue growing as a supplier for the US market, where closeness is one of our best assets. Mexico is already the largest exporter to the US in terms of medical technology. More than 160 thousand families depend on manufacturing medical devices, not to mention all the indirect jobs created around the medical device industry. Therefore, building on knowledge and capabilities for Mexico's industry is important, as it aligns with the government naming medical devices a strategic sector. We need to continue working on the regulatory framework with COFEPRIS as it is critical to keep moving forward, and we are investing efforts in that direction. There are big delays in the registration processes, but we are working with COFEPRIS to expedite the procedures reasonably. It is clear that technology is on an accelerated track, and the delays negatively impact patients in Mexico.
EF: Mexico has problems in that the pace of innovation goes faster than its corresponding regulations. Does Mexico have the potential to become an innovation hub - not just a manufacturing hub- in Latin America?
HO: Medtronic has always adhered to the high level of requirements. We never risk people's health; patients need guarantees, and we must achieve the digitalization of the processes. The issue must be faced not only in Mexico but in all of Latin America. Mexico, in particular, must define its direction and continue on that path because we will comply with the requirements once we know the process. Regarding innovation, the approach is different; legislation ought to be developed to increase innovation in the country; some efforts have been made, but there is still work to be done. Mexico has manufacturing knowledge and the necessary engineering capacities; we must partner with the government and private initiatives to drive our capabilities within the country. The regulatory framework needs improvement; the time frames and the sheer amount of information and data required are serious issues. There is also a need for adaptability when small adjustments need to be made, as we must go through the whole process again. The development of a regulatory framework for innovation over the coming years should be extremely interesting for us all.
EF: We are currently doing projects in Mexico, South Africa, and Germany, and coincidentally the country manager of Medtronic is also the president of the MedTech association in all three countries. What value does this bring to Medtronic, and how do you leverage common spaces to promote collaboration?
HO: As market leaders, responsibility goes with the position, our voice is important, and we must provide content on our actions to facilitate ethical conduct and ensure we do things correctly. We are responsible for being the industry's voice, not only on legislation; we have a view of the whole ecosystem because we are also involved in manufacturing and commercial. The strategy we bring to the industry is increasing patient and population access. It is tied into our mission of driving access, to make the industry grow and arrive at its full potential for the patient's benefit. All specialties hold benefits for patients, and we try to move them all forward; it is tied up with our responsibility as market leaders.
EF: On a global scale, the cardiovascular unit drives the most growth for Medtronic. What are the key growth drivers for your region, North Latam? Is there anything particularly exciting coming?
HO: Cardiac diseases are one of the leading causes of death in the country, together with diabetes. We would love to expedite cutting-edge technologies into the market in these segments and the surgical field. Our broad portfolio has many successful and excellent products, but the cardiovascular portfolio provides the most growth and leads the market. Cardio is a leading growth driver for us in Mexico. But once we have the registration approval, we will bring all the leading technologies to the Mexican market. Diabetes is also a key growth driver, but more is needed. We have a new technology, a closed system that helps the pancreas complete its process, and we want to bring this technology into the country for diabetic patients.
EF: A colleague of yours for the Southern Latam was ecstatic about AI, robotics, and their reception in her region. What are the latest technologies in your region, and how do you assess their receptiveness?
HO: In Mexico, we are still, unfortunately, in the process of getting the registrations for robotic surgeries, but in Panama, we have a very successful project in robotics, with very eager surgeons adopting the technology and prepared to start working with the latest technologies in robotic surgery. Some incredible tools and technologies are available; in the gastrointestinal field, our technology helps the surgeon when doing an endoscopy to identify lesions that are hardly perceptible to the surgeon's eye. The lesions would be missed without the support of AI tools, allowing us to anticipate treatments and greatly benefit the patients. The navigated spine surgery helps to provide better outcomes to the surgeons.
Technology improves the procedure enormously. The speed and the accuracy of AI in terms of diagnostics are life-changing. The technology will not substitute doctors; it greatly supports diagnostic decision-making for most procedures. A few weeks ago, a surgeon gave a talk, and he said that AI would not replace doctors but that doctors need to learn to use AI and leverage technology. If the doctors don't do this, they will be replaced by those who are open to adopting technology.
EF: If you had to create your own startup company tomorrow in the Mexican healthcare sector, what would it be and why? The hypothetical question is to understand where the opportunities lie in Mexico.
HO: I would most certainly do something that involved the digitalization of health. There are many possibilities to improve people's health by changing processes. All the different apps that are coming up are changing the way health is done so I would go in that direction. A couple of weeks ago, I talked to a group of entrepreneurs on digital health about providing medical training to surgeons and doctors. There are opportunities to build there.
EF: Our feature is called "Road Map to the Future," if you had to create a road map for the healthcare industry in Mexico, what would be your three base pillars?
HO: With access as our beacon, my first pillar would be availing doctors of our technology to leverage it in a health transformation. We are approaching a very relevant moment where technology must be in the doctor's hands. Training professionals to use and be close to the technology is a key factor to focus on because it will give wider access to patients in the short term. Secondly, we must keep working with the public and private healthcare ecosystems on the efficiency of the systems. We are still experiencing the tail end of Covid, with a backlog of health procedures placed on hold during the pandemic; many cases are at a more serious stage now than they would have been if they had been taken care of in due course. Moving forward, we must be capable of providing help and technology to patients when they need it, and the medical device industry can be an enabler for that efficiency. There will not be more resources for healthcare; the expenditure related to the GDP will not change, so we need to get results more efficiently. My last pillar is to focus on the regulatory process to comply with our mission; if we don't, the future will be very limited regarding new technologies.
EF: Is there any final message you would like to share?
HO: Medtronic must continue to be a strategic partner for the public and private healthcare ecosystems. We must continue down the same path, be smart and provide value to our partners within the health systems. In time we will all better understand how to improve and be better partners to assist more people in accessing the different technologies. We want to change the game, and we are changing the game.
