Health under fire over failure to back local pharma industry

The Department of Health has come under fire for undermining South Africa’s pharmaceutical manufacturing industry by prioritising cheaper imports over locally produced medicines. The issue was raised during deliberations by Parliament’s portfolio committee on Trade, Industry and Competition, where concerns were raised about what appears to be a disconnect between government’s industrialisation ambitions and the procurement decisions of the Health Department. The concerns come amid growing scrutiny of the department’s multibillion-rand antiretroviral (ARV) tender, which saw several established local pharmaceutical companies excluded from contracts to supply medicines to the public health system.

Briefing the committee, Pharmaceuticals Made in South Africa (Pharmisa) chairperson Stavros Nicolaou said the industry had shed 2 500 jobs in the last 18 months, as a result of the government not procuring enough drugs from domestic industry role-players. Eroding the capacity of domestic drug manufacturers, Nicolaou said, risked plunging the country into a health crisis in the event of a pandemic outbreak. “During Covid-19, South Africa was at the back of the queue for countermeasures [in terms of receiving vaccinations from developed countries].

It’s exceedingly disappointing that we have not heeded those lessons,” he said. According to Nicolaou, the government had this year procured 18% of its pills and capsules stock from local manufacturers — down from the 58% share domestic manufacturers commanded in 2014. With input and other costs escalating in recent years, Nicolaou said, the domestic industry needed government support to survive. The current three-year contracts the department was awarding domestic manufacturers were also problematic, Nicolaou said.