Activities. Annual. Report

Transcription

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2 Activities Annual Report 2012

3 2013 The United States-Mexico Foundation for Science Fundación México-Estados Unidos para la Ciencia San Francisco , Colonia Del Valle, 03100, México, D.F. Printed and made in Mexico Editorial Coordination: Rosario Taracena Editorial Assistance: Stephany Hernández, Yamania Olivé and Jessica Borth Design: Dinorah Mosqueda

4 Index Board of Governors 4 Origins of FUMEC 5 Letter from the Chairman of the Board of Governors 6 Letter from the Immediate Past Chairman of the Board of Governors 7 Letter from the CEO 8 Innovation Based Economic Development 10 FUMEC and its support programs for technology SMEs 11 Promoting innovative health technology companies 17 - Elemental Clinical Research: clinical research for a growing market 18 - CECYPE: clinical research for the global pharmaceutical industry 21 Supporting the growth of Mexican IT companies 23 - CloudSourceIT: a 100% mobile world 24 - Imagination Films: 3D dreams that become a reality 27 Promoting the development of processed food SMEs 28 - Grupo Jaztea: natural fresh tea, from Sinaloa to the world 30 - Avideg de México: the unmistakable flavor of Mexican food 33 Opening opportunities for advanced manufacturing firms 35 - Industrias Automotrices RC: innovative, but still traditional 37 - Intercovamex: high vacuum equipment with very high added value 40 Colombia looks to FUMEC programs to accelerate technology SMEs 41 Advanced Market-Oriented Research - I/UCRC: A role model for academia-industry liaison in Mexico 43 Development of Human Resources in Science and Technology 45 Health and Environment - CECyTEQ: shaping competitive talent for the knowledge economy 46 - Veracruz: children and young people building quality scientific education 48 - Motorola and Intel: companies committed to science education 50 - FUMEC supports U.S.-Mexico collaboration in epidemiological surveillance 52 - Encouraging entrepreneurs in low-income communities 54 Strengthening our collaboration with Canada 56 - Directory 58 - Our Offices 59 - Financial Information 60

5 Board of Governors Warren J. Baker Chairman President Emeritus of the California Polytechnic State University Juan Silanes Vice-Chairman President of the Bioclon Institute Francisco Barnés de Castro Immediate Past Chair Commissioner of the Energy Regulatory Commission Karl Rüggeberg Treasurer Executive Director at Chatsworth Securities LLC Thomas Bowles Executive Director at New Mexico Computing Applications Center José Luis Fernández Zayas Researcher at UNAM s Engineering Institute William Harris CEO of Science Foundation Arizona Silvia Hernández President-Associate of Public Strategy Consultants Santiago Levy Vice-President for Sectors and Knowledge at the Inter- American Development Bank Cristina Loyo Varela General Director of the National Laboratory on Advanced Computer Science Nestor Montoya Advisor at the financial services company TIAA-CREF Bernard Robertson Senior Vice President at DaimlerChrysler Corp. Leopoldo Rodríguez Adviser and Partner of various enterprises Cipriano Santos Senior Scientist at Hewlett-Packard Laboratories Mary Walshok Associate Vice Chancellor for Public Programs at the University of California, San Diego Misael Uribe Esquivel CEO at Médica Sur hospital Guillermo Fernández Secretary of the Board CEO of FUMEC 5

6 Origins of FUMEC I believe that our countries have a shared path and scientific cooperation is part of it. Congressman George E. Brown Jr. The United States-Mexico Foundation for Science (FU- MEC) is a nongovernmental organization created during the preparatory proceedings for signing the North American Free Trade Agreement, based on a binational accord with the aim of promoting and assisting collaboration in science and technology between the two countries. U.S. Congressman George E. Brown, Jr. played a key role in forming and consolidating FUMEC. As President of the Science and Technology Committee of the U.S. House of Representatives, Brown defended the need to strengthen binational exchange in these fi elds and his lobbying in the United States achieved the integration of an initial endowment for FUMEC of close to 11 million U.S. Dollars, which was an exceptional grant in assistance awarded to a nongovernmental organization by the U.S. Government. Congressman Brown was an untiring promoter of science and technology. After his death in 1999, he left an important legacy of enhancements to science and technology programs in the United States, standing out collaboration with other countries in this fi eld. Two important players in establishing FUMEC were the scientifi c advisors of the Presidents of both countries, Guillermo Soberón Acevedo in Mexico and Alan Bromley in the United States, who were in charge of organizing work groups and ensuring that a commitment to create the Foundation was reached by both governments, which was formally established as an organization with legal status in both countries since The United States-Mexico Foundation for Science, continuing with the spirit of collaboration that distinguished the work of Congressman George E. Brown, Jr., is seeking to become an entity that brings together binational efforts by identifying opportunities, creating synergies, integrating programs with objectives of binational interest, and searching for results in the fi elds that it is working. 6

7 Letter from the Chairman of the Board of Governors The Foundation has been expanding and consolidating its role as a catalyst for collaboration between the United States and Mexico in science, technology and innovation in an effort to help solve important problems that are of interest to the two countries. To this effect, it is very important to have available scientifi c and technological training that allows all those involved to be better prepared to contribute to fi nding solutions to the greatest challenges faced by our countries. One of the most pressing issues regarding competitiveness is undoubtedly improving education in regards to science, technology, engineering and mathematics (STEM education). FUMEC understands that to achieve this goal it is essential to work as a team and continue to generate partnerships between academia, industry, government and civil organizations. Improving STEM education has been a major goal of the United States and holds the highest priority within President Barack Obama s administration. As a result, great impetus has been given to these activities and programs related to them are being improved and expanded. Studies of STEM education programs have shown that they promote the development of critical and independent thinking skills, teamwork and problem solving skills. These are all essential in order for individuals to have more opportunities and make greater contributions to the development and application of scientifi c and technological advances. In the last ten years FUMEC has promoted collaboration between the two countries in STEM education, and in Mexico it has facilitated the use of experiential and investigative basic level science education systems. This has been done through Innovation on Science Education (INNOVEC as abbreviated in Spanish). INNOVEC has used the experience of institutions such as the Smithsonian Institution Science Education Center and other institutions in the United States and has drawn on the experience of countries like France, Argentina and Brazil, to name just a few. In the last decade, INNOVEC has trained more than 30,000 teachers in 12 Mexican states, now benefi tting 425,000 students annually. The results obtained by this program have led to the backing of federal and state authorities, as well as additional support from companies such as Motorola Solutions Mexico, Dow Chemical and Intel. FUMEC has also supported collaboration between the two countries in STEM education at the college level, through the Engineering Basics program in High School Education with the College of Science and Technology in the State of Queretaro (CECYTEQ as abbreviated in Spanish). The experiences of the South Texas Science Academy with programs such as Project Lead the Way (PLTW), and the University of California with its Mathematics Engineering and Science Achievement program (MESA), have been taken advantage of. This program has been very successful and is now an excellent reference for FUMEC activities. Throughout 2012 the Foundation opened new opportunities for collaboration between the two countries in STEM education at the university level. The groundwork for collaboration between CONACYT and the National Science Foundation in an effort to promote collaborative academia-industry cooperation was laid, creating partnerships with long-term vision. I am very pleased to be part of the efforts of an organization such as FUMEC, which has the vision and commitment needed to propose solutions that allow us to move steadily toward greater development and prosperity in our countries. Its programs in education, innovative business support and industry and health applied research show this to be true. Sincerely, Warren Baker President of the FUMEC Board of Governors 7

8 Letter from the Immediate Past Chairman of the Board of Governors In May of 2012 in Washington, we celebrated the 20th anniversary of FUMEC in the United States. The Foundation was honored to have the participation of many distinguished guests such as John Holdren, Advisor to President Barack Obama on Science and Technology; Arturo Sarukhán, Mexican Ambassador to the United States; Mario Molina, Nobel Laureate in Chemistry and Martha Brown, widow of Congressman George Brown, who was a key figure in the creation of FUMEC. At the celebration, these individuals affi rmed their support for the initiatives and projects of the Foundation and recognized FUMEC as an organization that contributes to the implementation of solutions and the creation of opportunities for development in North America. Throughout its history, FUMEC has been known for being fl exible and creative and for translating global experiences into actions and programs that promote social and economic growth locally, nationally and internationally. This role as an articulator of efforts has allowed FUMEC to identify the interests and meet the needs of today s knowledge economy, and to be a pioneer in developing initiatives that both countries need to become more competitive. The experience gained over the last 20 years has resulted in programs that support successful technology companies by taking advantage of the best experiences of programs in the United States and Canada, to allow these companies to grow and become sustainable in a highly changing and competitive global market. Thanks to the support of FUMEC and the TechPYME program, hundreds of Mexican companies have been able to identify existing market opportunities, and refocus their business plans to take advantage of these opportunities. Also, more mature companies have received very high level business advising from the TechBA acceleration program and as a result, have discovered new business openings in global markets. The effectiveness and robustness of the Foundation is now recognized by many public and private actors due to the impressive results achieved by their programs. After 20 years of work, FUMEC is certainly a major player in science, technology and innovation in both Mexico and the United States, and even in countries like Canada, who see the Foundation as an ally for increasing collaboration among North American countries. This report details the progress achieved by FUMEC during 2012 and recognizes the Foundation s great efforts in helping to create a better life through science, technology and innovation. One of the great strengths of FUMEC, is its ability to foster cooperation with institutions and organizations that rely on the Foundation s experience and knowledge. I would especially like to thank the Secretariat of Economy, the National Council for Science and Technology and the Mexican Institute of Industrial Property for their support. These institutions have worked with FUMEC to benefi t technology companies and researchers, but also, to ultimately contribute to the creation of a culture of innovation. I would also like to thank my colleagues on the Board of Governors, for the support they have given us during the time I was at the head of this body. Their experience and knowledge have enabled the Foundation to achieve greater focus and to have a stronger impact with their programs. I am sure that this organization will continue to make a strong contribution in achieving a better quality of life for both our countries. Sincerely, Francisco Barnes de Castro Chairman of the Board of Governors of FUMEC from 2011 to

9 Letter from the CEO A central goal of FUMEC is to open new avenues of cooperation in science, technology and education, and to promote the economic and social development of Mexico and the United States, in the context of regional cooperation in North America. During 2012, we made strong advances in the innovation and internationalization of Mexican companies by facilitating partnerships with organizations, companies and government agencies in the United States, Canada and other countries. This year, we also expanded educational collaboration in science, technology, engineering and mathematics (STEM) and opened new opportunities for collaboration in research oriented towards the needs of companies and government organizations. We continued channeling program resources from the United States government to Mexico for binational health and environment programs. A change of federal government in Mexico occurred in As a result, part of our energy has been directed at maintaining close contact with the transition team and with those who will shape the new policies in Mexico. These efforts have been to ensure that collaboration with our allies in North America in science, technology and innovation is central to addressing many of the great challenges facing Mexico, including quality education, supporting entrepreneurs and boosting innovation as an engine for development. In 2012 in Washington DC, we celebrated the 20th anniversary of the creation of the Foundation in the United States. This celebration provided the opportunity to bring our Board of Governors closer to the heads of government offi ces and non-governmental organizations who have worked with and supported FUMEC over the years. It also helped to open new opportunities, for example, with the National Science Foundation in the fi eld of Industry-University Consortium with long-term objectives, and the National Institutes of Health on research and development to address diabetes and its complications. The 20th anniversary celebration in Washington received an excellent response from key organizations in the United States, especially from the White House Offi ce of Science and Technology Policy, an organization that coordinates and promotes science, technology and innovation activities in the U.S. These interactions show a favorable outlook for further advancing tri-national cooperation on these issues, to generate a more competitive region in the global context. We are pleased with the results we have achieved, both with the companies we have served through our TechBA and TechPYME programs, as well as with our programs that promote childhood education in science and technology. In addition, we welcomed the establishment of a new line of action of FUMEC aimed at advanced market-oriented research and are proud to see excellent results in our surveillance and food safety programs. The work in all of these areas favored new relationships with local and federal associations, as well as with key stakeholders who define regional development policies. We have also expanded our collaboration with international organizations such as the Inter-American Development Bank and the World Bank and have maintained a close relationship with the U.S. Embassy in Mexico. The results shown in this report are refl ective of the efforts of more than 120 people who worked with us throughout We appreciate the commitment that they put forth every day to better position FUMEC as a major player in binational collaboration I would also like to thank the invaluable support we have received from our Board of Governors, who have provided guidance and support to us and have enthusiastically shared their knowledge, experience and contacts. Last but not least, I want to thank all of the organizations and individuals who have been allies of our projects and initiatives, because without them we could not move forward in achieving our goals. Sincerely, Guillermo Fernández de la Garza Chief Executive Offi cer of FUMEC 9

10 Results by Programatic Area

11 Innovation Based Economic Development Innovation is the motor of the transformations that will keep the Mexican economy competitive. Mexico is way behind many of its allies and competitors in innovation-related indexes. There is an urgent need to step up the pace in technological and corporate ecosystems that support innovation in businesses. FUMEC has facilitated valuable interactions between Mexican, U.S. and Canadian organizations that have expanded the view of Mexican experts, business leaders and government organizations in terms of the mechanisms and programs which can be developed and strengthened by leveraging the best experiences of the three countries. Some of these mechanisms and programs, such as TechPYME and TechBA, have already been rolled out as a preview to the kind of programs that might be implemented at national level with international partnerships and referents. This involves the creation of sectoral innovation networks in specifi c regions, and nationally, the alignment of companies technological strategies with the development of education and research institutions, and with the support of the relevant government programs both at state and national level. In other cases, there has been support for initiatives like that of Dr. José Narro Robles, Rector of the UNAM, to integrate a National Science, Technology and Innovation Agenda, and that of Antonio López de Silanes to create the Business Foundation for Innovation, a clear sign that innovation is a key issue for business leaders in Mexico who are willing to build a collaboration program with the Federal Government through this Foundation. Furthermore, there has been collaboration with the Science and Technology Advisory Forum in other initiatives, such as the National Innovation Agency, and efforts involving the United States National Research Council (NRC) and Canada s Science, Technology and Innovation Council (STIC), underlining the importance of mechanisms that are independent from the organisms that operate innovation support programs, to study, propose, manage and ultimately evaluate the country s initiatives in innovation. The following pages describe FUMEC s work to promote economic development based on technological innovation, through local, national and international processes such as the formation of innovation networks to facilitate interactions between academia, industry and government, and through specialized programs for technology fi rms who work in market niches with high growth potential. 11

12 FUMEC and its support programs for technology SMEs In 1997 the Foundation began activities to leverage the best experiences of the United States and Canada, to boost the growth of small and medium-sized technology businesses with the help of universities, research institutions and specialized organizations. Through the years, we have been able to build programs directed at technology businesses with rapid growth potential, to help them fi nd counseling and support to develop internationally, taking full advantage of opportunities for technological and business improvement, and join innovation networks focused on strategic economic niches. Around 12 years ago we adopted different elements from programs like the Small Business Technology Development Center (SBTDC), the Pennsylvania Technological Assistance Program (PENNTAP) from the United States, and the Industrial Research Assistance Program (IRAP) from Canada, which have enriched the way in which we provide our services to companies, enabling us to be more timely and effective. Through the years, we have been able to build programs directed at technology businesses with rapid growth potential. In 2004, following an in-depth investigation of the most successful international mechanisms of business support, and in conjunction with the Secretariat of Economy, we created TechBA, the Technology Business Acceleration Program for Mexican technology companies, which today has eight sites in highly dynamic business ecosystems: fi ve in the United States, two in Canada and another in Spain. The experience gained over the years has enabled us to mature our service models and organize the services we give to fi rms in two programs: TechPYME and TechBA. TechPYME (PYME is the Spanish equivalent of SME) is a program focused on building national innovation networks, particularly with state governments, supporting businesses in strategic economic niches through coordination mechanisms with local institutions and organizations. TechPYME studies and develops the capacities and development potential of technology-business ecosystems in those niches. TechBA is the network that facilitates the internationalization of technology SMEs in the strategic economic niches in which the Foundation works, and is also the point of contact for national innovation networks with the international ecosystems where it operates. Innovation networks: key to the growth of businesses One of the key components of our work through Tech- PYME and TechBA is the creation of innovation networks, connecting fi rms with all those players who can support their growth, such as universities, research centers, state and federal governments, clusters, business chambers and tractor companies, among others. Firms that join either of these programs not only gain access to a support program, but also come into contact with different innovation networks in which FUMEC participates, in order to support the firms in the best way possible. We at the Foundation know that an isolated SME must face a series of challenges which can be overwhelming without the support of organisms and actors helping them to grow. However, when a business accesses a support network and an adequate coordination system, it can receive technical assistance, specialized assessment and information and a wide variety of services which enable it to better defi ne its path to strengthen and be successful. 12

13 FUMEC collaboration networks contribute to the development of technology companies and to the growth of strategic economic niches. Throughout this report we will show how the local networks created by FUMEC support the growth of technology SMEs and how these networks are also effective mechanisms to promote economic development in several states. A clear example of how FUMEC support networks operate occurred in 2012 with our Health Technologies Coordination, which worked in close collaboration with the Mexican Consulate General in Boston to take a group of Mexican companies to BIO 2012, the world s biggest biotech convention. After the event, the General Consul sent a letter which read, in part: Thanks to the work of FUMEC, it was made clear to the other participating countries and industries that Mexico is also a major player in biotechnology and the life sciences, which contributed signifi cantly to improving our country s image, enabling different actors to see fi rsthand the quality and abundance of scientifi c research in Mexico. FUMEC continues to work with ProMéxico and the Consulate General in Boston to take a group of businesses to this great event again in 2013, further spreading the potential of the country and its biotechnology companies. In a similar way, in April 2012, a Mexican delegation of six companies attended the SAE Congress, a major international automotive convention held in Detroit, Michigan. This time the delegation included three companies supported by TechBA in Michigan, and who, in turn, received support from ProMéxico to attend the event. These and many more examples presented throughout the report show how FUMEC collaboration networks contribute to the development of technology companies and to the growth of strategic economic niches, connecting Mexican regional ecosystems with international business ecosystems, thereby opening endless opportunities for the companies themselves and the actors who drive economic development in Mexico and North America. Focus on high growth potential niches As mentioned earlier, central to the work we do in FUMEC is the organization of innovation and business support networks, which are formed around economic niches or subsectors with the potential to generate new development opportunities. The Foundation has identifi ed more than 15 industrial niches or subsectors which have undergone considerable growth and which offer incomparable business opportunities for SMEs seeking to consolidate and win new markets. A breakdown of these strategic niches is given in the following table. 13

14 Strategic Niches Identified by FUMEC SECTOR Information Technologies Automotive Aerospace Health Technologies Food technologies Sustainability Microsystems NICHES Cloud computing Mobile technologies Multimedia Advanced manufacturing Advanced manufacturing Overhaul and maintenance Airport services Medical devices Clinical trials New drugs IT for health Nutraceutics Manufacturing processes Clean technologies (air, water, earth) Alternative energy Embedded systems FPGAS FUMEC participates in and promotes networking in each of these niches, allowing us to broaden the horizons of activity for companies through national and international actions such as: liaison with other government and private programs, experience and expert knowledge in areas related to their own, association with similar companies with whom they can build partnerships, interaction with tractor companies seeking to strengthen their supply chain, and contact with potential investors to fi nance their projects. TechPYME As already mentioned, the TechPYME program works with technology SMEs in Mexico and forms innovation networks to help businesses develop their capacities. As well as working directly with businesses, another key objective of the program is to strengthen regional ecosystems that work in strategic niches to enable them to generate and mature an ever greater number of companies, in turn boosting new knowledge industries. To achieve this, TechPYME works alongside the state Secretaries of Economic Development to create collaborations which encourage the growth of both businesses and the business ecosystems where they operate. This program also analyzes growth opportunities in the strategic niches in which we work and develops studies to gain insight into market opportunities which businesses can take advantage of. These studies help businesses discover the challenges and opportunities in their industries, and also serve to attract new companies looking to grow in those niches. TechPYME begins by identifying companies eligible to receive support from FUMEC. It then does an evaluation of needs and growth opportunities and draws up an action plan for each company. Later, the companies receive all kinds of services ranging from training and assessment in specifi c areas, to help obtaining certifi cations and liaison services with actors and programs to help them grow. Furthermore, this program encourages the development of innovation strategies that the companies can present to federal and state organisms when seeking funding, and facilitate the registration of patents and utility models with national authorities. TechPYME works through a network of Business Technology Advisors who are responsible for identifying the companies, evaluating them and introducing them to the services they need to boost their growth. These advisers work at local and regional level, have areas of specialization, and use tools that are of great use to the companies, including road maps, cash fl ow evaluation and management skills assessment. The TechPYME service model is summarized in the next graphic. 14

15 TechPYME Service Model NEEDED INFRASTRUCTURE FOR EACH NICHE Trends and Opportunities Studies Training of Human Resources -Academia -Enterprises Integration of the Business Technology Advisor Development of a Innovation Network for the Niche DEVELOPMENT OF STRENGTHENING PROGRAMS FOR THE COMPANIES Market opportunity analysis workshop ACTION PLAN BY COMPANY BUSINESS STRENGTHENING Diagnostics Roadmap Entrepreneurial tools Liaison with other support programs and institutions INNOVATION STRATEGIES Innovation networks Calls for companies and presentation of projects Intellectual property Technological monitoring COMMERCIAL AND TECHNICAL READINESS Technical advice Certification advice Interaction with commercial and technological networks IDENTIFICATION OF COMPANIES WITH POTENTIAL TO BE INTERNATIONALLY ACCELERATED Networking events Integration to the TechBA program Results in new products, new markets, access to innovation funds, new organization culture and measurement of impact on sales. TechPYME results Results of the TechPYME Program In 2012 TechPYME continued to search for and evaluate technology companies with growth potential in an effort to fi nd the SMEs that work in the niches detected by FUMEC and that could be integrated into this program. This was done to combine the portfolio of companies to be worked with in the period, adding businesses with growth potential to those that had already been identifi ed. TechPYME reviewed and analyzed state, regional and national business directories, and subsequently made several calls to interview and learn more about the companies interested in entering the program. As a result of these efforts, a portfolio of 361 companies that entered TechPYME starting in August 2012 and that will continue to receive services until July 2013 was created. The following table shows the distribution of these companies and the niches in which they work. SECTOR Information technologies Automotive Aerospace Other advanced manufacturing areas Health technologies Food technologies Clean technologies New materials Total Number of companies

16 TechBA The TechBA program was designed to help Mexican technology companies gain access to the most dynamic business ecosystems in the world and expand their operations into international markets, primarily the United States, Canada and Europe. TechBA has eight locations in cities with highly competitive and specialized economic activity: Arizona, Austin, Madrid, Michigan, Montreal, Seattle, Silicon Valley and Vancouver. The TechBA acceleration model is aimed at catalyzing the development of companies, facilitating access to a wide network of high-level international advisors and experts with profound knowledge of the technological processes and markets of each sector. The guidance from these experts enables companies to improve their value offer to ensure international success and guarantee long-term permanence. This program facilitates the interaction of Mexican SMEs with different business environments, allowing them to achieve accelerated growth by creating partnerships, generating new sales and attracting investment. Each Tech- BA site has a wide network of experts in their economic fi elds, and key actors and organizations from the region who support the growth of the Mexican companies. In addition to their acceleration services, TechBA offers businesses a pre-acceleration process that consists of analyzing their potential for penetrating international markets and the advantages that would imply for each company from a technical-commercial angle. Pre-acceleration informs companies about their strengths and weaknesses, and improvement opportunities should they want to enter the global marketplace. During acceleration, work centers on improving the value offer of each business. On many occasions this implies deep adjustments to the products and services they hope to launch on new markets. Another relevant aspect is improving the way the value offer of each company is presented to potential buyers, and familiarizing business owners with how business is done in global markets. The TechBA service model is shown below. TechBA Service Model Incorporation and work plan Initial market penetration plan Sales support Business maturation Review of value proposition and market penetration strategy (investment and alliance search) Implementation of beta test and interaction with friendly clients Directory development and client profiling Integration of an Advisory Council Adaptation of the product or service to the new market (certifications, IP protection, etc.) Consulting and access to network of contacts Refinement of marketing and commercialization strategies Implementation of commercialization tools (campaigns, demand generation, distributor development, etc.) Sales coaching Sales channel development Customer service Evaluation of company s development Implementation of complementary financial strategies, innovation, and business model review 16

17 The TechBA program has played an outstanding role in the internationalization of innovation networks involving Mexican companies. The TechBA program has played an outstanding role in the internationalization of innovation networks involving Mexican companies, and in introducing innovative support models to Mexico for the creation of new businesses and the strengthening of technology companies. An example of this is the Bootcamp model, designed to help companies establish successful, sustainable business in a few weeks. Bootcamps allow companies to quickly evaluate whether their business ideas have market potential or need adapting. Bootcamp is an opportunity to conduct market research, develop and refi ne business ideas and build prototypes, as well as validate clients and investment possibilities to ultimately take sustainable products to market. Results of the TechBA Program During 2012, the TechBA program worked with 185 businesses which generated international sales in excess of $140 million dollars. When compared to the resources invested by the Secretariat of Economy to operate the program, this fi gure gives a $22.88 dollar return on every dollar invested. The following table shows that the return rate of the TechBA program has increased consistently over the last four years. Operation costs of the TechBA program vs. international sales generated by companies in the program (figures in U.S. dollars) International sales $40,958,171 $95,579,760 $145,024,881 $147,761,921 Supported companies Resources coming from Mexican Secretariat of Economy $5,673,600 $7,432,000 $8,037,037 $6,459,090 Rate of return (international sales generated per dollar invested)

18 Promoting innovative health technology companies Mexico has enormous growth potential in numerous areas related to health technologies, including medical devices, clinical trials and pharmaceutical industry, medical tourism and information technology applied to health. This section describes the opportunities that FUMEC has identifi ed for the growth of health SMEs in the country, and how we had worked in those niches to boost the competitiveness of businesses and enhance the capacities of the ecosystems in which they operate. Medical Devices In recent years, the country has become increasingly attractive for the global medical device industry and this is reflected in the accelerated growth of domestic production and the growing number of investments received in this area. Mexico is the seventh biggest exporter of medical devices in the world and, according to data from INEGI and ProMéxico, produced $8.56 billion dollars in medical devices in By 2020, production is expected to reach $14.91 billion dollars. 1 In 2011, Mexico exported $6 billion dollars in medical devices and attracted 23 investment projects in the same area. 2 This industry has grown at a rate of 6.4%, well above traditional producers like Germany, Japan and Switzerland. According to data from CANIFARMA, between 2007 and 2010, Mexican medical device companies increased sales by 24.2%. Similarly, from 2002 to 2011, jobs in this niche grew from 17 to 32 thousand and are expected to continue to grow with the presence of new companies. 1 In early 2013, DHL Supply Chain revealed a study which indicated that the robust domestic demand and a forecasted annual growth rate of 5.2% for 2020, have turned the country into an attractive option for many medical device manufacturers from the United States and other parts of the world seeking to serve the domestic market or improve manufacturing costs with a maquila strategy in Mexico. Beyond the numbers, Mexican business owners are ready to face a greater demand for their products; in the words of Miguel Ángel Félix Díaz Alonso, treasurer of the Medical Device Cluster of the Californias, In this region we are used to putting up a fi ght. The mentality of business owners here is to fi nd the way to do things right. There are many regulations in medical devices and the process for being a supplier can be slow, but we will come on board because by being authorized suppliers we will be on a path towards success. This cluster includes the majority of medical device companies in Baja California Norte and Sur and maintains close ties with the cluster in San Diego, California, 1 Estrada Cortés, Jesús (2012). Medica Devices, a Healthy Business, in Negocios ProMéxico. October. 2 Juárez López de Nava, José Mario (2012). Medical Devices en Mexico: Opportunities for Baja California, in Negocios ProMéxico. October. 18

19 Mexican business owners are ready to face a greater demand for their products. forming one of the most complex and diverse groups of medical products in the whole of North America. Since 2010, the cluster to which Félix Díaz belongs, has been a FUMEC ally, providing support to health companies in Baja California. When asked how the work was going, he said, In Tijuana we have had a very healthy relationship; through FUMEC some companies have benefitted from help obtaining certifications, attending seminars and courses on project portfolio management, and getting more information about the sector. Other benefits of being in contact with FUMEC has been broadening the cluster s spectrum of relationships and getting to know new business environments. In 2011 we took a trip to Spain, says Félix Díaz. We were met by TechBA Madrid and through them we made visits to get contacts, talks and see the kind of support we could get. This business owner appreciates the Foundation s work in putting the cluster in touch with new actors because, The relationships have shown us how we might achieve a different projection. I think we were focused too locally, very much within the region, but FUMEC has allowed us to see things more globally, to see that as a group we need to be related to other sectors and countries, and that we must have greater openness with government, education and other entities. hacetouch with nwts, chat and see the kind of support we ogoing, the enter the ie accelerate Although this relationship did not immediately bear fruit, in the medium term the companies who participate in the cluster have seen results: As a sector, it would never have occurred to us to go to Madrid to explore business opportunities, because the whole world naturally tells you we have the United States right next door, but this relationship has enabled us to get help for seminars and courses and that is a very valuable result, beginning as a group to have joint initiatives, concludes Félix Díaz. Elemental Clinical Research: clinical research for a growing market In 2010, six Jalisco doctors decided to develop an intraurethral catheter to administer drugs to parts of the body which are inaccessible by traditional catheters. They realized they needed to do clinical trials and opted to conduct them themselves. And so Elemental Clinical Research was born, a company specialized in clinical research and services for the pharmaceutical industry. To consolidate their project, the doctors attended an incubator of the Tecnológico de Monterrey, where they learned the basics of creating a business. They soon realized they were getting into a very little known area in Mexico, because even the Tec people struggled to understand our business model, remembers Luis René González Lucano, Operations Director of Elemental Research. As they continued the incubation process, they discovered that FUMEC offers support to health companies, in particular those conducting clinical research. With the help of Michelle Otero, FUMEC s FUMEC helped us make many contacts, have opened many doors for us and that is why we are here now. Health Technologies representative in Jalisco, they contacted the Foundation and began to see Mexico s enormous potential for growing businesses like theirs. In 2012, Elemental Research responded to an invitation from FUMEC to attend the 3rd International Life Sciences Convention, where they met a company called CECYPE, also supported by FU- MEC, and began to analyze ways to partner. Today the partnership is a reality and their primary objective is to strengthen clinical research in our zone, said González. We want to offer comprehensive services like CECYPE and CIATEJ to expand the 19

20 cover to Jalisco which is the second most important zone for the pharmaceutical industry, after Mexico City. And so, almost without forethought, Elemental Clinical Research entered the clinical trial business at a very opportune moment when there was already a demand for their services. New medicines are coming into the country because the population has grown a lot, and investors see Mexico as an area of opportunity. Furthermore, we have a privileged position right next to the United States and that enables us to conduct studies very quickly, explains González. The growth of the industry has meant the consolidation of this company which, despite being only two years old, has already more than doubled in sales and the number of employees. For its founders, part of the success is due to the support received from FUMEC. They have helped us make many contacts, have opened many doors for us and that is why we are here now, says González, who predicts that the company will grow even more, because we have projects ready to sign and that makes us optimistic. Clinical Trials and Pharmaceutical Industry Another great area of opportunity in health has to do with the development of preclinical and clinical trials for drug development. In 2008, investment in the global drug industry rose to 86 billion dollars. Investment in clinical trials was $54.8 billion dollars in 2009, with a 9.1% growth over the previous year and prospects of reaching a value of $81.2 billion in Today the drug industry is facing the need to develop new products, but is struggling to do so in developed countries because of high costs and problems recruiting volunteers for their trials. As a result, large fi rms have begun to pass preclinical and clinical trials on to specialized companies known as clinical or contract research organizations (CROs) which develop different stages of the process in certain developing countries. This situation suggests a favorable setting for clinical research in Mexico, since the country has excellent conditions for creating and consolidating companies that function as There is a favorable setting for clinical research in Mexico, since the country has excellent conditions for creating and consolidating companies that function as CROs. 3 CECYPE, Ensayos clínicos en México: retos y oportunidades. Estudio elaborado por CECYPE a solicitud de FUMEC. CROs. A study performed in 2011 for FUMEC found that Mexico underutilizes its capacity to generate this kind of company, and occupies a marginal position (26th in the world) in the conduct of clinical trials in spite of its privileged geographical location, internationally competitive regulations, good number of inhabitants and skilled professionals. 3 Furthermore, Mexico is listed among the so-called pharma emerging countries, but the growth of its drug market is below the average for this group and will drop from 11th place in 2005 to 17th in It is worth remembering that there are more than 200 drug companies in Mexico with the infrastructure to produce drugs to supply a domestic market of $14 billion dollars. Through its TechPYME and TechBA programs, the Foundation has helped develop companies seeking to enter the clinical trial market and the pharmaceutical industry, giving them advice and resources to do so. The support network for health companies that TechPYME has formed in Jalisco is shown in the next page. 20

21 Support network for health companies in Jalisco A. Clusters 1. Medical Tourism Cluster 2. West Bioclúster 3. Association of Private Hospitals of Jalisco B. Universities and research centers 4. Guadalajara University 5. Center of Research, Technological Assistance and Design of the Jalisco State 6. Center of Research and Advanced Studies of the National Polytechnic Institute C. Government institutions and other entrepreneurial support organizations 7. ProMéxico 8. Jalisco Institute of Information Technologies 9. Council on Science and Technology of the Jalisco State 10. Regional Chambe of the Transformation Industry 11. Jalisco Secretariat of Economic Development 12. National Chamber of Commerce 13. Jalisco Institute of Quality 14. Institute for Development and Innovation within the SMEs In Jalisco, the representative of the Health Technologies Coordination, Michelle Otero, has provided support to 32 health companies with help from the local Ministry of Economic Development and the organisms that form part of the network created by FUMEC. According to Ernesto Baez López, Director General of Sectoral Development and Integration of Jalisco, this state is the second most important corridor in the country for human pharma and the first in animal pharma, so support for health companies is vital for the local economy. In the Baez experience, Companies which have participated in FUMEC programs have been satisfied. Nevertheless, he feels that FUMEC has tools which as an institution we could leverage a lot more. Two clear examples of the support that FUMEC provides to health SMEs are Elemental Clinical Research of Jalisco, whose success story was presented on page 20 NN, and CECYPE of Morelia, whose case is given below. Medical Tourism In mid 2012, The New York Times published an article which spoke of the influx of United States citizens who travel to Mexicali seeking medical care. 4 The text described how in 2011 more than 150 thousand patients traveled to that city to see a doctor, generating an economic spillover for the local economy of $8 million dollars. The publication of this article was no more than the acknowledgment of the growing popularity of Mexico among United States patients who need low-cost medical care and travel south for everything from dental care to heart surgeries to cosmetic weight-loss procedures. According to the United States-Mexico Chamber of Commerce (USMCOC), medical tourism in Mexico has enormous growth potential, made popular by rising health costs in the United States and improvements in other countries in the standards of care and the technology they use. 5 4 Medina, Jennifer (2012). Mexicali Tour, From Tummy Tuck to Root Canal artículo publicado en The New York Times el 27 de junio de USMCOC (2011). Tourism Development, Medical Tourism, and Safe and Secure Tourism in Mexico. Issue Paper 3. Retrieved from org, on February

22 CECYPE: clinical research for the global pharmaceutical industry CECYPE executives are convinced that Mexico can become a world leader in preclinical and clinical research. We need to create an environment that converts the country into a hub, because the best way to grow this industry is to have more people developing research, explains the engineer Jorge Herrera, CEO of the Morelia company. A couple of years ago, at FUMEC s request, CE- CYPE made an analysis of Mexico s opportunities in this industry and found that the country did not leverage its growth capacities and is in a secondary position, 26th in the world, despite its incomparable geographical location, competitive regulations, a good-sized market and competent professionals. Hence, we re looking for the opportunity to develop that capacity in Mexico, continued Herrera. We need to create an environment that converts the country into a hub for clinical trials. It all seems to indicate that the pharmaceutical industry will continue to demand specialized research services, which motivated CECYPE to partner with the CIATEJ research center in Jalisco to start new preclinical, clinical and analytical trial units, and generate new units as growth demands. The said units will be built in two or three cities and serve to evaluate biotechnology and bioequivalent medicines, pharma chemicals, medical devices, new treatment schemes and even functional foods. Paradoxically, this national expansion plan is the result of the CECYPE s exposure to international markets which they had the opportunity to explore thanks to TechBA Madrid, a program it entered in 2009 and that helped it set up a company in the Volunteers on a study conducted by CECYPE. Photo courtesy of the company. Basque Country by the name of CECYPE Europe. There, the company is about to begin an investigation on the genetic factors which predispose renal impairment, through an alliance with the University of Euskadi. Although CECYPE has been well received in Spain, things were different in the beginning; the Spanish were skeptical. There had been total incredulity about Mexico s capacity to conduct studies. They even asked us questions that might seem offensive: Do they know what good clinical practices are in Mexico? Do they work with ethics committees? recalls Herrera, who adds, You can understand their attitude because in the recent past it didn t exist, but when we started to show them that we had clients like Sanofi and Bayer, who know our capability and recommend us, they changed their attitude and went from doubt to awe. For CECYPE, having presence in Spain is part of its strategy to get into the European market. We are still seeking out new markets and we have allies in Spain with knowledge of the French and Swiss markets. We are also defi nitely interested in the United States, Canada and Germany, above all with the new biotechnology services and functional foods, said Herrera. 22