E-DRUG: BMJ on Africa medicines manufacturing
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Can (and should) Africa make its own medicines?
BMJ 2015; 350 doi: http://dx.doi.org/10.1136/bmj.h2178 (Published 28 April
2015) Cite this as: BMJ 2015;350:h2178
Mara Kardas-Nelson, freelance journalist, USA
Support for Africa producing medicines is in vogue these days. The World
Health Organization executive director, Margaret Chan, supports it.1 So does
Michel Sidibé, head of UNAIDS. The goal is to address health inequities and
build capacity to meet supply shortages for essential health commodities
that cannot be sourced reliably and sustainably from outside the continent,
they wrote last year.1 Major international organisations and donors, from
the UN Industrial Development Organization (Unido)2 to the German Federal
Enterprise for International Cooperation,3 are providing technical
assistance to make local production happen, and the African Union has put
together a business plan to spur its implementation.4
The rationale for local production is simple: it is assumed that big donors
bankrolling many of Africas programmes for HIV, tuberculosis, and malaria,
three of the continents biggest killers, wont stick around forever. Africa
imports 70% of its drugs,5 and if African countries have to pick up more of
the tab, some drugs could instead be produced at home, bolstering local
economies. Local production might also provide a more steady supply of
medicines, ensuring that drugs are immediately available during local health
emergencies and even in the face of international shocks, such as when the
Chinese government closed down its chemical companies during the Beijing
Olympics, leading to shortages of active pharmaceutical ingredients used by
some African countries.6
Local production could also give greater control to overstretched African
regulators, which are battling against low quality drugs, sometimes made in
far-off factories that are difficult to monitor. African companies,
governments, and international organisations that support local production
say the aspiration is for Africa to be able to produce generic drugs, not
patented products, spurring an industry like that of Indias, which has one
of the largest generic industries in the world.7
But making enough medicine for the continent is a long way off. According to
WHO, 37 sub-Saharan African countries have some pharmaceutical production
capacity, but only South Africa makes active ingredients, the key component
of a medicine.8 And even where pharmaceutical companies are up and running,
output is limitedfor example, WHO estimates that Ghanas pharmaceutical
sector, one of the healthier in the continent, is operating at only 50%
capacity.8
Barriers
African companies face substantial hurdles. Supplies of electricity and
water are often unreliable, and poor roads make transporting goods cheaply,
and efficiently, difficult. Several peoplefrom African drug manufacturers
to representatives of international institutionstold me that it is cheaper
and faster to transport goods from India to Kenya than from Mombasa to
Nairobi (within Kenya).
Finding enough appropriately skilled staff is another problem. Many African
countries produce only handfuls of pharmacists, technicians, and business
managers each year, many of whom leave for greener pastures. And accessing
affordable finance in some countries can be difficult. Take the case of
Zimbabwe, where a once thriving pharmaceutical sector, already gutted by a
series of economic and political embarrassments, was dealt a final death
knell by the 2008 hyperinflation crisis. Alois Muchabaiwa, managing director
of Zimbabwes Varichem Pharmaceuticalsin its heydays one of the regions
most successful companiessays that now the firm cant get a loan for longer
than 12 months.
Even if companies are successful in starting production, they face steep
competition from Indian generics, which famously supply antiretrovirals at
99% below originator prices. Affordable generics from the country has helped
to fuel a massive international response,9 and Indian generic producers
continue to act as the key supplier of medicines to big donors like the
Global Fund to Fight AIDS, Tuberculosis and Malaria and the US Presidents
Emergency Plan for AIDS Relief, whose multibillion dollar annual budgets
fund the overwhelming majority of programmes for these three diseases in
many African countries.10 Indeed, 80% of antiretrovirals purchased with
donor funding in low and middle income countries are made by Indian
manufacturers.11
Fledgling African producers, in need of large and predictable markets in
order to reach economies of scale, want a slice of that pie. But most
international funders require the medicines they buy to be either WHO
prequalified or approved by a stringent regulatory authority like the US
Food and Drug Administration or the European Medicines Agency. (No African
regulatory authorities are considered stringent, and most African companies
prefer to use the prequalified route.)
Tough market
Today, only a handful of African produced drugs are WHO prequalified. And
prequalification doesnt guarantee procurement from a big donor. Theres an
expectation that you get prequalified and then suddenly youre the goose
that gets the golden egg, says Alastair West, senior technical adviser at
Unidos local production project. But all the donors are supplying
medicines for the same diseases, so the market is saturated. Its very
difficult to compete. There are very low margins. Ugandas Quality
Chemicals, one of Africas flagship drug companies, has yet to supply
antiretrovirals to any big donors despite getting WHO approval, largely
because its prices are almost double that of the cheapest Indian generics.12
Some local production proponents accuse donors of choking the continents
pharmaceutical industry. Wilberforce Wanyanga, a former Unido consultant and
former general manager for Cosmos, a Kenyan drug company, says that when the
Global Fund started supplying antimalarials in the country, it sourced
primarily from companies outside the continent, pushing a healthy local
industry out of the market. He says that before the Global Fund supported
malaria programme was introduced 16 Kenyan companies were making artemisin
based combination therapies. Now there are only two, because the Global
Fund is supplying everything.
Youre actually strangling a country. You need to have generic producers
who can jump in when you have a shortfall of supply, he says.
Sudip Chadhuri, professor of economics at the Indian Institute of Management
in Kolkata, says the attitude of donors is, We want to buy from the
cheapest source. We dont care about industrial policy. The Global Funds
head of communications, Seth Faison, agrees. We see [local production] as a
practical issue not a political issue. Wherever a company can produce high
quality health products at reasonable prices, we are interested, no matter
where the company is located
We strive to serve people, not companies, and
not governments. We cannot compromise on quality and price.
Local production has some important sceptics. For example, South Africas
Treatment Action Campaign, which campaigns for better access to care for
people with HIV, says that more expensive, locally produced medicines should
not necessarily be favoured over affordable imports that have been key to
fuelling the international response to the epidemic, especially given
limited health budgets.13 Zafar Mirza, coordinator of the health systems and
innovation cluster at WHO, says that whether African local production is a
good thing depends on your definition of success. Are you looking at this
from a health perspective or an industrial policy perspective? You need to
ask: which medicine is being produced? Is it aligned to local needs? Is it
affordable? Is it of high quality? A company may be doing very good business
producing only vitamins, or only cough and cold remedies, which are not good
commodities from a public health point of view.
Although local production champions say that homegrown efforts could provide
African solutions to African problems, theres little indication that
private, profit driven companies in Africa are any more willing than
companies elsewhere to make drugs for neglected tropical diseases such as
sleeping sickness and guinea worm, which disproportionately affect the
continent. What my shareholders will look at is return on investment, says
Palu Dhanani, managing director of Universal Corporation, a Kenyan generics
company. What is the benefit for us developing a product for neglected
diseases when theres no market for it?
Christophe Perrin, pharmaceutical coordinator of Médecins Sans Frontières
access campaign, suggests that companies focus on non-communicable diseases
rather than the oversaturated market for HIV, tuberculosis, and malaria
drugs, in which they cant compete. African countries are struck by cancer,
asthma, diabetes. There we see a huge opportunity for African manufacturers
to be ready for the needs of African people. We know the volumes that are
needed in Africa, and the gap in access is enormous. As a result of the
focus on communicable diseases and an unexpected rise in conditions such as
diabetes and heart disease, researchers say the continent as facing a
neglected epidemic of non-communicable disease.14
African governments could do more to nurture budding industries. Countries
could set up regional medicine regulatory authorities, allowing companies to
sell in multiple countries with only one registration, saving time and money
and, importantly, offering expanded markets. Until that happens, individual
regulatory agencies could be strengthened to stamp out low quality drugs and
boost confidence in African regulatorsnot necessarily known for their
stringent oversightand by proxy African manufacturers.
Other policies could also be enacted: interest rates could be lowered.
Import barriers, such as tariffs on imported medicines, could be levied.
Countries could decide to buy selected medicines only from local producers,
as has been done in Ghana and Nigeria. Mostly, though, Chadhuri says whats
needed is political will. What is the main constraint of the development of
local production in Africa? he asks. Its not the size of the market. Its
the attitude of the government. Industries do not just develop. They need to
be supported.
--
Douglas Ball
Pharmaceutical consultant
Public Health and Development
E-mail: douglasball(AT]yahoo.co.uk