MEDICAL ADVANCEMENTS : AFRICA’S HUGE POTENTIAL IN THE MEDICAL FIELD ILLUSTRATED THROUGH 4 FIGURES

Aspen Pharmacare, Africa’s largest pharmaceutical company, has unveiled a production line for general anaesthetics at its flagship plant in Gqeberha, Eastern Cape. © aspenpharma

By Jeune Afrique

The pandemic has highlighted Africa’s dependence on foreign countries, as 90% of its medicines are imported. This leaves room to develop the continent’s local pharmaceutical industry.

As only 4.4% of the continent’s population is fully vaccinated against Covid-19, African governments, supported by local businesses and health activists, are stressing the need to develop local drug production.

Given the current situation, this opens up multi-billion dollar investment opportunities for the pharmaceutical industry. The proof is in four figures:

5.9% growth per year

The latest estimates from the United Nations Economic Commission for Africa (UNECA), headed by Vera Songwe, show that the continent imports more than $16bn worth of medical products every year. And yet, developing a local pharmaceutical industry could help support national economies, create jobs, encourage research and facilitate access to medicines in the event of an epidemic.

Based on this observation, investors – including Chinese, but also European and US ones – have indicated that they want to take advantage of the demand by reinforcing the drug manufacturing capabilities of the continent, which should be able to compete with Asian pharmaceutical companies as they currently export mainly cheap generic drugs.

For example, the African pharmaceutical market is estimated to grow at an annual rate of 5.9% between 2018 and 2022, thereby reaching a total value of over $25bn.

415 million vaccine doses

This week, South African drugmaker Aspen Pharmacare unveiled a production line for general anaesthetics at its flagship plant in Gqeberha, Eastern Cape. This is the largest general anaesthetic plant in the southern hemisphere and is part of a larger Aspen operation. In 2019, the latter began manufacturing doses of Johnson & Johnson’s Covid-19 vaccine.

Ebrahim Patel, South Africa’s minister of trade, industry and competition, described the plant’s unveiling as a major milestone, as it can be re-equipped to produce up to 415 million Covid-19 vaccine doses per year.

However, earlier this year, Aspen drew the ire of civil society members when it was revealed that a large percentage of its production capacity (220 million Covid-19 vaccine doses) was destined for Europe. European and African Union (AU) leaders quickly intervened and the vaccines were then redirected to Africa.

375 drug manufacturers

It is no accident that the African pharmaceutical industry has experienced a spike in investment. According to McKinsey & Company, “Africa may be the only pharmaceutical market where it is still possible to achieve truly high growth.”

IFC, the World Bank’s private sector arm, agrees, pointing out that Africa still has very few local or regional pharmaceutical manufacturing companies. According to the institution’s data, there are about 375 drug manufacturers – mainly in North Africa – serving a population of just over 1.1 billion people. By comparison, China and India, each with a population of about 1.4 billion, have 5,000 and 10,500 drug manufacturers respectively.

“Sub-Saharan manufacturers are largely clustered in nine out of the 46 countries in the region,” McKinsey noted in a 2019 report.

$500m investment

‘Big Pharma’ now has its eyes on the continent. In October, the biotech company Moderna announced that it would be spending up to $500m to build a new factory in Africa, both to manufacture doses of its Covid-19 vaccine and to produce other types of vaccine there.

Pfizer and BioNTech have also signed an agreement with South Africa’s Biovac Institute to help manufacture about 100 million doses per year of their vaccine for the AU. It is worth noting that BioNTech has already signed an agreement with the Bill and Melinda Gates Foundation to develop programmes to fight HIV and tuberculosis in Africa.

Smaller pharmaceutical companies and distributors are also looking to expand, while governments have pledged to increase funding for public medical research facilities.