New investors have recently entered the key pharmaceuticals industry resulting in increased production of medicines and medical supplies, helping reduce Zimbabwe’s import bill.
The outbreak of the Covid-19 pandemic put pressure on the local pharmaceuticals sector as demand increased exponentially owing to the disruption of the supply chain from other countries.
It also was a great opportunity for Zimbabwe to be less dependent on foreign medical supplies, thereby increasing the local manufacturing of therapeutics.
According to Industry and Commerce Minister Sekai Nzenza, the pandemic was an opportunity for the Government to come up with more innovative ways to increase local production.
She was responding to questions at the post-Cabinet briefing on how the sector was performing in light of increased demand.
“When Covid-19 struck, we were on 12 percent local production of pharmaceuticals. Today in my state of industry report, I indicated that we are now at 45 percent capacity utilisation and this has happened as a result of us seeing Covid as an opportunity for more innovative ways to increase local production,” she said.
Zimbabwe’s pharmaceutical industry has been dominated by a few big players for years, but due to various economic challenges, obsolete equipment and lack of capital to increase production, the sector had all but collapsed.
In the wake of the Covid-19 pandemic and the pursuing challenges, Government put in place strategies to address the issues within the sector.
In March 2021, Zimbabwe became the 19th African Union (AU) member state to sign the treaty to establish the African Medicines Agency (AMA). This move is expected to enable a favourable regulatory environment for pharmaceutical research and development, local production and trade across countries on the African continent.
In June the same year, Government launched the 2021-2025 Pharmaceutical Manufacturing Strategy to improve the local production of drugs, thereby increasing the availability of the country’s essential medicines and exporting the excess drugs.
This has contributed to the developments now being felt within the sector.
Minister Nzenza said old players like Datlabs had injected fresh capital to increase production while new players had started operations.
“Datlabs invested US$1 million on a plant upgrade and we have Plus Five Pharmaceuticals, they increased their production after they injected US$274 000 into plant expansion. We also have two new players,” she said.
“President Mnangagwa visited Namibia in 2019 and met a Zimbabwean pharmacist and he encouraged him to come home and set up a pharmaceutical company. He has since come back and has set up his company called Sapps.”
The minister said Sapps would become the first company to produce pessaries and suppositories locally thus eliminating the need to import them.
Another local producer, Seasons Pharmaceuticals has also invested US$3 million for the production of tablets, capsules as well as complementary and oral liquids.
She said although capacity utilisation had grown to 45 percent, more still needed to be done to attract more investment into the sector and continue increasing production.
According to a recent report titled “Zimbabwe pharmaceutical market — growth, trends Covid-19 impact and forecast (2022-2027)”, the pharmaceutical market in Zimbabwe is expected to register a compound annual growth rate (CAGR) of 4,35 percent between 2022 and 2027.
This could help drive more investment into the sector and further improve capacity and have an impact on the price of medicines.
Health economist Dr Prosper Chitambara said although the increase in local production could result in a reduction in pricing of drugs, there was more to be done for that reduction to be felt.
“The unit cost of production tends to fall as capacity utilisation increases and of course the coming in on board of new players will also have a similar effect on pricing.
“However, I don’t think it will be very significant. More still needs to be done especially in terms of ensuring that Zimbabwe has a thriving pharmaceutical industry where we are producing more and more of the drugs we use,” he said.
He said Zimbabwe had already had a comparative advantage in terms of pharmaceuticals and should maximise on that to increase production to full throttle and ensure the sustainable competitiveness even in terms of pricing. – The Herald
