Mexico's Health-Care Demands Could Present Private Investment Opportunity Hillary Canada - WSJ.com
go to original June 8, 2015

A burgeoning middle class and aging population are creating greater demand for health care services beyond what Mexico’s state-run medical programs can offer, potentially opening up an opportunity for private investments, panelists told attendees of the Mexico PE Day conference, hosted by the Mexican Association of PE & VC Funds in New York.

“Mexico is underinvesting in health care,” said Hector Valle, a health-care consultant who has worked for IMS Health Inc. in Latin America. Mr. Valle noted that Mexico currently spends around 6.2% annually on the industry, compared with an average of 7.4% across other Latin American countries. By comparison, the U.S. spends close to 17% of its gross domestic product on health care, according to data from the World Bank.

There aren’t enough hospital beds or specialists to meet demand, said Daniel Broid, medical infrastructure planning coordinator at Instituto Mexicano del Seguro Social, Mexico’s state-owned health care and social services institution. Those, coupled with treatment of degenerative diseases such as cancer, offer the biggest opportunities for providers, he said.

“Money coming from private investors would be well-received,” said Mr. Valle.

“The infrastructure is underdeveloped,” said Harry Krensky, managing partner of Discovery Americas, a Mexico-focused private equity firm. “The government has done a good job creating a safety net, but demand for private services is outstripping supply.”

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