Pharmaceuticals and Medical Equipment in Latin America

October 2021

In 2020, Latin America ranked fourth globally in terms of production output of pharmaceuticals and medical equipment, with a turnover of USD107 billion. Following a contraction in 2020, due to the COVID-19 pandemic, the industry is set to return to growth in 2021. Long-term development will, however, be subdued due to the difficult operating environment.

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Key findings

The outlook for the pharmaceuticals and medical equipment industry in Latin America is sluggish

The Latin American pharmaceuticals and medical equipment industry is expected to decline slightly over the forecast period, representing the weakest performance among the regions, mainly due to a difficult operating environment in Puerto Rico, the region’s largest drug and device producer. The region is, however, set to remain the fourth largest producer of pharmaceuticals and medical devices globally.

Brazil and Argentina to support future industry growth

Production of pharmaceuticals in Brazil and Argentina is set to record steady post-pandemic growth. This expansion will be largely driven by growing demand for healthcare services from ageing populations, expanding investment in healthcare infrastructure, greater interest from foreign investors, as well as efforts to strengthen capacity in weak or lacking areas, including production of mRNA-based vaccines.

Costa Rica to maintain its strong position as a medtech manufacturing hub

Two decades of transformational development, coupled with a range of incentives, have helped Costa Rica to strengthen its position as an advanced and innovative hub for the production of medical equipment. Home to a large number of leading medical original equipment manufacturers, the country is also set to witness strong expansion of medtech contract manufacturers.

Latin American producers are set to benefit from global trends of supply chain diversification

Supply chain disruptions brought about by the COVID-19 outbreak have underscored the benefits of production nearshoring. Thus, the US’s plans to diversify the supply chain of pharmaceuticals and medical equipment, as well as efforts to localise production in Latin America, are expected to bolster investment in the region and support future growth.

Reliance on imports of innovative medicines and equipment to remain strong

While production of pharmaceuticals and medical equipment in Latin America primarily targets cost-effective products, such as generics and biosimilars, domestic demand for innovative and high-complexity products, including biopharmaceuticals, is largely satisfied by imports from leading global producers operating in developed economies.

Introduction

Scope
Key findings

Production Outlook

The industry is poised for stagnation in the long term
Turnover plunged in 2020, due to the adverse impact of COVID-19
Brazil and Argentina to remain key growth drivers in the region
Rising investment flows will support medical equipment production
Brazil to remain a strong contributor to region al growth
Pharmaceuticals to maintain the largest turnover share in the region

Competitive Landscape

Small firms dominate pharmaceuticals and medical equipment
Large corporations are responsible for majority of production

Foreign Trade

Trends of nearshoring to support Latin American exporters
The region remains reliant on imports of APIs and innovative products

Country Snapshots

Puerto Rico: Production Context
Puerto Rico: Foreign Trade Landscape
Brazil: Production Context
Brazil: Foreign Trade L andscape
Mexico: Production C ontext
Mexico: Foreign Trade L andscape
Argentina: Production Context
Argentina: Foreign Trade Landscape
Costa Rica: Production Context
Costa Rica: Foreign Trade L andscape
Colombia: Production Context
Colombia: Foreign Trade L andscape
Chile: Production Context
Chile: Foreign Trade Landscape
Cuba: Production C ontext
Cuba: Foreign T rade L andscape
Peru: Production Context
Peru: Foreign Trade L andscape
Ecuador: Production Context
Ecuador: Foreign Trade L andscape
Uruguay: Production Context
Uruguay: Foreign T rade Landscape
Dominican Republic: Production Context
Dominican Republic: Foreign Trade Landscape
Panama: Production Context
Panama: Foreign Trade L andscape
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