$40m fa­cil­ity for drug com­pa­nies

Chronicle (Zimbabwe) - - Business Chronicle - Harare Bureau

THE Gov­ern­ment is work­ing on a fi­nan­cial pack­age of be­tween $20 mil­lion and $40 mil­lion to re­vi­talise pro­duc­tion ca­pac­ity of Zim­babwe’s dis­tressed phar­ma­ceu­ti­cal in­dus­try to pro­duce es­sen­tial drugs.

Zim­babwe In­vest­ment Au­thor­ity chair­man Mr Nigel Chanakira said the au­thor­ity is in the process of putting to­gether a re­port on the phar­ma­ceu­ti­cal in­dus­try’s needs, set to be com­plete by next month.

Mr Chanakira said the Min­istry of In­dus­try and Com­merce is lead­ing the process of putting to­gether the fund­ing pack­age after a United Na­tions In­dus­trial De­vel­op­ment Or­gan­i­sa­tion (UNIDO) study into sta­tus of the sec­tor, which high­lighted is­sues that need to be ad­dressed.

UNIDO com­pleted the ex­ten­sive study and re­port into the state of af­fairs in the coun­try’s phar­ma­ceu­ti­cal in­dus­try and made rec­om­men­da­tions on ap­pro­pri­ate reme­dies, at pol­icy, in­sti­tu­tional and en­ter­prise level to en­hance the in­dus­try’s ca­pac­ity.

Four com­pa­nies — CAPS Hold­ings, Varichem, Dat­labs, Plus Five Phar­ma­ceu­ti­cals — face fund­ing chal­lenges to in­crease pro­duc­tion and were in­volved in gath­er­ing the data used in the re­port.

“We have fin­ished work with UNIDO. We are work­ing with the Min­istry of In­dus­try and Com­merce. What is re­quired is to get the phar­ma­ceu­ti­cal sec­tor re­vamped, which re­quires an es­ti­mated $20 mil­lion to $40 mil­lion. We will fin­ish the re­port in De­cem­ber,” he said.

The im­por­tance of the phar­ma­ceu­ti­cal in­dus­try can­not be overem­pha­sised given its con­tri­bu­tion to the pro­duc­tion of es­sen­tial medicines (47 per­cent of items on the Es­sen­tial Drug List for Zim­babwe).

On­go­ing ef­forts are aimed at in­creas­ing pro­duc­tion ca­pac­ity and port­fo­lio of medicines the in­dus­try can pro­duce.

The Zim­bab­wean phar­ma­ceu­ti­cal in­dus­try is char­ac­terised by a few man­u­fac­tur­ers with a to­tal of nine, ac­cord­ing to the most re­cent Reg­is­ter of Li­censed Phar­ma­ceu­ti­cal Man­u­fac­tur­ing Premises pub­lished by the Medicines Con­trol Au­thor­ity of Zim­babwe.

Of these nine com­pa­nies, four are se­ri­ous generic man­u­fac­tur­ers while the rest are largely con­cen­trat­ing on trad­ing and have nar­row prod­uct port­fo­lios. These four phar­ma­ceu­ti­cal com­pa­nies could eas­ily ac­count for 90 per­cent of the sec­ondary phar­ma­ceu­ti­cal man­u­fac­tur­ing (for­mu­la­tion) business in the coun­try.

Ac­cord­ing to UNIDO all stake­hold­ers, in­clud­ing the Phar­ma­ceu­ti­cal Man­u­fac­tur­ers’ As­so­ci­a­tion, Min­istries of Fi­nance and Eco­nomic De­vel­op­ment, In­dus­try and Com­merce and Health and Child Wel­fare need to form a phar­ma­ceu­ti­cal work­ing group re­spon­si­ble for ex­am­in­ing pol­icy af­fect­ing the phar­ma­ceu­ti­cal in­dus­try.

Zim­bab­wean generic phar­ma­ceu­ti­cal man­u­fac­tur­ing com­pa­nies have thus been fac­ing var­i­ous se­ri­ous chal­lenges for the past 10 years, with the sit­u­a­tion de­te­ri­o­rat­ing at an even faster rate from around 2008.

Ini­tially, UNIDO said, the ma­jor chal­lenge was a marked lack of for­eign cur­rency to fund both work­ing cap­i­tal and cap­i­tal ex­pen­di­ture.

De­spite the pres­ence of ac­cept­able lev­els of both do­mes­tic and ex­port or­der books, the in­dus­try was fail­ing to re­spond be­cause of the non-avail­abil­ity of for­eign cur­rency to pur­chase in­puts.

The fund­ing chal­lenges made it im­pos­si­ble for the com­pa­nies to fund equip­ment and ma­chin­ery main­te­nance, and re­place­ment and this led to a huge stock of an­ti­quated and di­lap­i­dated ma­chin­ery. Notwith­stand­ing the con­straints, the Zim­bab­wean phar­ma­ceu­ti­cal in­dus­try has man­aged to sur­vive.

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