As Its Domestic Market Grows, South Africa Moves Toward Greater Local Biopharmaceutical Production

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Pictured: Aerial view of Cape Town, South Africa/iStock, Ben1183

High import costs, late access to drugs and disease burden are pushing South Africa to build a strong domestic biopharmaceutical sector.

A report by Arizton in August 2023 projects that the market value for biopharmaceuticals within the country will double by 2028 from its $1.1 billion worth in 2022, growing at a compound annual growth rate of 12.30%. In another signal of the sector’s momentum, Aspen Pharmacare Holdings, a South African biopharmaceutical company, has reported that its revenue increased by 5% this year. Manufacturing biopharmaceuticals in the country would further expand this market, ensure access to drugs and provide affordable therapies for South Africans, experts say.

The industry’s growth is a reflection of a renewed commitment by the government to manufacture biopharmaceuticals locally, said David Katerere, the research chair of pharmaceutical and biotechnology advancement in Africa at Tshwane University of Technology, South Africa. “There is very low access to life-saving drugs in the African continent. That is why there is a movement to promote the manufacture of biotherapeutics on the continent,” he explained. He said the movement is very active in South Africa and has government backing. Last year, following a partnership between Aspen Pharmacare Holdings and the Serum Institute of India, South Africa’s Minister of Trade, Industry and Competiton said in statement that the South African government is working with local pharmaceutical companies to kickstart the biotechnology sector in the country, reduce reliance on import and improve vaccine supply. Biovac, a South African biopharmaceutical company that is partly owned by the government, recently collaborated with ImmunityBio, a U.S.-based biopharmaceutical company, to produce active pharmaceutical ingredients for a COVID-19 vaccine.

Strong International Ties

Although the country is not a big manufacturing hub, Katerere said South Africa has a robust clinical development environment. Gayathri Raghupathy, vice president of scientific and business strategy at Kognitic Inc., who monitors partnerships that occur in the biopharmaceutical industry, told BioSpace there are currently 269 active oncology trials in South Africa, 208 of which share sites with the U.S. and other countries. Many of these trials are sponsored by non–South African companies. “This trend emphasizes the enduring collaboration between the U.S.A. and South Africa in conducting oncology clinical trials,” Raghupathy said.

According to the Arizton report, the South African biopharmaceutical market is dominated by multinational companies like Pfizer, GSK, Johnson & Johnson, Sanofi and AbbVie. Jackie Maimin, CEO of the Independent Community Pharmacy Association, which represents professionals in the South African healthcare sector, said these companies lack a strong workforce in the country and have to partner with domestic companies. Currently, the South African biopharmaceutical market is focused on generic medicines and Aspen is a key player in this field, frequently partnering with other companies to bring medicines into South Africa. For example, Aspen recently partnered with Eli Lilly Export S.A., a subsidiary of Eli Lilly and Company, to market and distribute its products in sub-Saharan Africa. During the pandemic, Aspen also collaborated with Johnson & Johnson to supply the COVID-19 vaccine to South Africa. Katerere said most of the medications available in South Africa are imported from other countries, especially India.

The Case for South African–Made Drugs

This lack of domestic production is hurting the economy as import costs soar, Maimin said. “I think it’s becoming unaffordable to always import medicines from the likes of the U.K., Germany, Spain and the United States of America.”

Maimin noted that the costs of imported drugs are compounded by a “quadruple burden of disease” that is draining the country’s purse. “We have a lot of diabetes and cardiovascular disease; our non-communicable diseases are growing very quickly. On top of that, we’ve got the largest HIV [burden] in the world and our infectious diseases linked with TB are growing, and then unfortunately we also have a lot of violence and injuries,” Maimin noted. “When you look at all of these, we spend a lot of our GDP on health to support the pharmaceutical market.”

Arizton’s report shows that biopharmaceuticals have positively affected the country’s disease burden. That’s especially true of the antiretroviral therapy used in managing HIV/AIDS. Maimin said the antiretroviral program in South Africa is predominantly funded by the U.S. South Africa’s broader biopharmaceutical market is thriving on various sources of funding. An example is the mRNA vaccine technology transfer hub launched in 2021 to produce mRNA vaccines for Africans. The hub is an initiative supported by the World Health Organization, the Medicines Patent Pool and the Act-Accelerator/COVAX.

It is not clear when South Africa might start manufacturing biopharmaceuticals, as it is currently hampered by a cost-motivated preference for foreign medications, the high cost of local manufacturing and regulatory issues in the country and within the continent, experts told BioSpace. In contrast to some regions in Asia and elsewhere, sub-Saharan Africa’s drug manufacturing facilities are poorly equipped. In addition, Maimin said medications imported from India are far cheaper than locally produced versions and that the health ministry favors cheaper drugs.

Another issue, Maimin said, is that if a new drug is imported into South Africa from another continent, it needs to be registered, and if the drug is exported to another African country, it will undergo another round of registration. African leaders are looking to harmonize the regulatory bodies within the continent so that medicines exported to African countries will not be required to undergo regulatory procedures, Maimin said. “There’s a move towards registering a product once in Africa and then it’s available to all African countries,” she explained.

Katerere said Africa does not manufacture drugs because the continent’s governments do not buy from local manufacturers. To ensure the country increases its production of local biopharmaceuticals, Katerere said its Department of Health should look toward local manufacturers first when choosing suppliers.  Maimin suggested the South African government should first seek to understand why local medications are very expensive and then build stronger market relationships with other African countries. “If we could better partner with local African companies, I think it would be far better for Africa on the whole. It would make medicine more affordable. It also wouldn’t leave us at the back of the queue when there is an emergency situation like the COVID pandemic,” Maimin said.

Patience Asanga is a Nigeria-based freelance science journalist who writes about the environment, biotechnology and life sciences.

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