What Caused Mexico’s Medicine Shortage? Everything You Need to Know

This explainer breaks down the policy decisions that disrupted Mexico’s drug procurement system and details how the Sheinbaum administration is working to restore access to essential medications.

BLUF - Causes of Mexico’s Pharmaceutical Shortages

Mexico is experiencing a historic shortage of medication, medical supplies, and medical professionals - a crisis largely precipitated and driven by actions taken by then-president Andrés Manuel López Obrador. To root out corruption, reduce public health spending, and increase accountability, the AMLO administration dismantled the existing drug procurement system without implementing effective alternative mechanisms. The result has left millions of Mexicans without access to essential medications, including insulin, various chemotherapy drugs, and other life-saving treatments.

What Caused Mexico’s Medicine Shortage?

Addressing Mexico’s medicine shortage has been a persistent challenge for the Mexican government, yet it’s a challenge of its own making, one wholly initiated by Sheinbaum’s predecessor, AMLO. Now, Sheinbaum and her team are tasked with addressing the shortages, a feat that has proven to be a moving target, but recent announcements have stoked optimism.

How AMLO’s Policies Created a Public Health Emergency

A variety of factors contributed to Mexico’s medication shortage. Still, the biggest, most significant precipitating factor was the AMLO administration, with AMLO himself vowing to reform Mexico’s healthcare system, transforming it to match the excellence of Denmark’s healthcare system (a comment that provoked many, many critical comments from the people faced with actually dealing with Mexico’s healthcare system). Mexico’s system for sourcing and distributing medications experienced three major hits throughout the AMLO administration, fundamentally weakening the industry and setting the scene for significant medicinal shortages.

Before the AMLO administration, the Mexican Social Security Institute (IMSS) was responsible for purchasing medicine and medical supplies for its clinics and hospitals, as well as for state and federal medical institutions. Between 2013 and 2018, IMSS saved an estimated over $1 million USD in medications. And yet, in 2018, the López Obrador administration fundamentally altered the provision and procurement processes for medication and medical supplies in Mexico, delegating the Ministry of Finance and Public Credit (SCHP) the responsibility for procurement, citing claims that doing so would reduce costs and corruption. However, analysis found that this shift actually resulted in a significant loss of institutional knowledge and technical expertise. Beyond those losses, the first procurement of the AMLO administration resulted in 62% of the demanded drugs being unfulfilled.

The second blow came in 2019, when AMLO vetoed three primary distributors of medication in Mexico, Grufesa, Dimesa, and Maypo, citing monopolistic practices. As such, the Mexican government was prohibited from further purchasing medication from these companies, thus resulting in significant shortages of medication. The third blow came in 2020, when Laboratorios Pisa, a major producer of oncology drugs in Mexico, ceased production after a contamination incident. This caused additional strain to the already fragile medicinal distribution system, one to be even further weakened by the COVID-19 pandemic.

To address these challenges in supply, the Mexican government announced in 2020 that the United Nations Office for Project Services (UNOPs) was to control the medical purchasing process from 2021 through 2024. This came at the price tag of approximately $85 million USD – for a service that was previously administered by IMSS for free. Of note, however, the distribution process remained unaccounted for, so the AMLO administration proposed the use of Birmex (Biológicos y Reactivos de México) as the primary entity responsible for the distribution of medication.

What is Birmex?

Birmex is a public company, originally founded in 1999, and was responsible for the production of vaccines. Presently, however, Birmex is responsible for the import and distribution of medicines and medical supplies. Investigations into Birmex have found significant instances of corruption. According to Cero Impunidad, it is the organization with the second-highest rates of misappropriation through the use of false invoices to charge for consulting services and training, among other HR activities.

What is the Megafarmacia del Bienestar?

Despite the budgetary deficit, the AMLO administration sought to enhance Mexico’s healthcare system in other ways, one of which was through the development of the Megafarmacia del Bienestar, (the Well-being Megapharmacy) a facility initiated in December of 2023 intended to fulfill the Mexican government’s commitment to “the right to universal and free access to effective medications and medical treatments, including high-cost ones.” AMLO deemed the megapharmacy a solution to the megacorruption within the healthcare and pharmaceutical industry. The megapharmacy is located in the State of Mexico, functioning as a distribution center for more remote health centers with the capacity to hold nearly 300 million medications. The pharmacy is open 24/7, 365, and Birmex serves as the sole coordinator and logistics operator of the Well-Being Megapharmacy.

The pharmacy is intended to facilitate the allocation of medication in a more streamlined and accessible manner, but there is an inherent irony – the AMLO administration fundamentally crippled Mexico’s access to medications through strategic policy decisions. Despite the administration’s promises of a commitment to universal access to medications and medical treatments, policy decisions prove otherwise, making individuals question whether the provision of service is actually a priority or merely lip service intended to mobilize popular support.

What Are the Consequences of Mexico’s Medicine Shortage?

Mexico’s healthcare sector is another casualty of the republican austerity approach imposed by the AMLO administration. The government’s decision to reform the sector, specifically the procurement process for medication and medical supplies, without a sufficient replacement structure has led to devastating public health consequences. In 2022, more than 15 million prescriptions went unfilled across Mexico due to the shortage. While the number of unfilled prescriptions was halved the following year, more than 7.5 million prescriptions went unfilled and the states most negatively impacted by the pharmaceutical shortages were Aguascalientes (with only 37% of prescriptions filled), Chihuahua (51% of prescriptions filled, Guerrero (57% of prescriptions filled), and Baja California (58% of prescriptions filled). Included in these unfulfilled prescriptions are chemotherapy drugs, the shortage particularly impacting Mexico’s population of childhood cancer patients. Of note, during the final year of Enrique Peña Nieto’s presidential term, 3.1 million prescriptions remained unfilled.

Falling Vaccination Rates and Rising Out-of-Pocket Costs

Another key consequence of the shortages has been falling vaccination rates. In 2022, the vaccination rate for measles, mumps, and rubella (MMR) was 91.8%, falling to 66.8% in 2023. And yet, despite rhetoric of austerity and decreases in public spending, the AMLO administration actually increased public spending, accounting for 27% of total GDP as compared to his predecessor, whose public spending amounted to 23.1% of Mexico’s GDP. This increase in spending came at the expense of several key sectors, including public health, which experienced a 60.2% decrease in spending between the start of AMLO’s term in 2018 and the end, in 2024. Despite cuts in funding for the public health sector, the López Obrador administration’s transformation of the pharmaceutical procurement process drove up prices. As a result, although the government purchased significantly fewer medications, the administration paid 29% more as compared to the previous administration. Patients also spent, on average, 39% more on medication in 2022 as compared to 2018, when AMLO took office.

How has the Sheinbaum administration managed Mexico’s pharmaceutical shortages?

During her inauguration, Claudia Sheinbaum listed 100 priorities for her administration, one of which was addressing the ongoing medication shortages. Part of this strategy includes incentivizing foreign investment to enhance the production of medication and medical supplies in Mexico, simultaneously addressing the shortages while also attempting to decrease high import costs. While specifics of this proposal have yet to be released, the Sheinbaum administration has encouraged collaboration between international pharmaceutical companies and Mexico’s own domestic research facilities to both develop solutions and enhance production for medications for diseases across Mexico. Companies investing in Mexico will have a higher likelihood of winning bids, an effort to reduce government spending on medicinal imports. The government has also emphasized the importance of generic drugs, which will also reduce costs.

A New Procurement Model and Digital Transparency

Sheinbaum has made clear that Birmex will continue to play an integral role in the provision of medication and medical supplies in Mexico, but has promised a new contracting model for the purchasing process, one reliant on a digital systems model to avoid corruption. There are currently two publicly available platforms, one for citizens to check the progress of the medication procurement process and another for citizens to check the medication delivery process.

As of yesterday, July 15, 2025, the Mexican government has purchased 96% of medications and supplies, more than 207 different types of medication in total. The Sheinbaum administration has invested significant sums into medical purchases for 2025-2026, investing more than $15 billion USD for the two years to ensure sufficient supply.

What are Rutas de la Salud?

The Sheinbaum administration has also launched Rutas de la Salud (Health Routes), a program to enhance cooperation between IMSS-Bienestar and state governments to ensure access to sufficient medications and medical supplies. While Birmex currently delivers medications to 23 out of Mexico’s 32 states, this new program is intended to expand coverage to all of Mexico’s states. With an investment of over $6 million USD, the program will expand medication deliveries from IMSS Bienestar across the country, starting in August 2025.

What Lies Ahead for Mexico’s Public Health System?

The Sheinbaum administration is making significant efforts to address the medicine and medical supply shortages ushered in by her predecessor’s decision to slash funding for public health. While Sheinbaum’s commitment to rectifying the shortages and vows to enhance transparency in the procurement process signal positive shifts. Still, it remains to be seen whether these efforts will be enough to rebuild the system and restore access to medication, medical supplies, and medical care, not only to pre-AMLO levels, but beyond.