Africa’s enormous potential in the medical field illustrated through 4 figures
With only 4.4% of the continent’s population fully immunized against Covid-19, African governments, backed by local businesses and health activists, are insisting on the need to expand local drug production.
Given the current situation, this opens up multi-billion dollar investment opportunities for the pharmaceutical industry. The proof in four figures:
1. 5.9% growth per year
Latest estimates from the United Nations Economic Commission for Africa (UNECA), headed by Vera Songwe, show that the continent imports more than $16 billion worth of medical products every year. However, 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 – particularly Chinese, but also European and American – have indicated they want to take advantage of demand by building up the continent’s drug manufacturing capacities, which should be able to compete with Asian pharmaceutical companies as they currently mainly export cheap generic drugs.
For example, the African pharmaceutical market is expected to grow at an annual rate of 5.9% between 2018 and 2022, reaching a total value of over $25 billion.
2. 415 million doses of vaccine
This week, South African drugmaker Aspen Pharmacare unveiled a production line for general anesthetics at its flagship factory in Gqeberha in the Eastern Cape. It is the largest general anesthesia 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 for trade, industry and competition, called the plant’s inauguration a major milestone, as it can be retooled to produce up to 415 million doses of Covid-19 vaccine per year.
However, earlier this year, Aspen came under fire from members of civil society when it was revealed that a significant percentage of its production capacity (220 million doses of Covid-19 vaccine) was earmarked for Europe. European and African Union (AU) leaders quickly intervened and the vaccines were then redirected to Africa.
3. 375 drug manufacturers
It is no coincidence that the African pharmaceutical industry has experienced a peak in investment. According to McKinsey & Company, “Africa is perhaps the only pharmaceutical market where it is still possible to achieve truly high growth”.
IFC, the private sector arm of the World Bank, agrees, pointing out that Africa still has very few local or regional pharmaceutical companies. According to the institution’s data, there are about 375 drugmakers – mostly 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 drugmakers, respectively.
“Sub-Saharan manufacturers are largely clustered in nine of the region’s 46 countries,” McKinsey noted in a 2019 report.
4. $500 million investment
“Big Pharma” now has its sights set on the continent. In October, biotech company Moderna announced it would spend up to $500 million to build a new factory in Africa, both to manufacture doses of its Covid-19 vaccine and to produce other types there. of vaccines.
Pfizer and BioNTech have also signed an agreement with the Biovac Institute of South Africa to help manufacture approximately 100 million doses per year of their vaccine for DU. Note that BioNTech has already signed an agreement with the Bill and Melinda Gates Foundation to develop programs to fight HIV and tuberculosis in Africa.
Small pharmaceutical companies and distributors are also looking to expand, while governments have pledged to increase funding for public medical research facilities.