"Primarily, the authorities are doing it to create employment, as the authorities do not appreciate the low level of employment
in pharmaceutical factories. Although I believe it is a misinformed objective, considering the pharmaceutical industry has
highly skilled and highly automated businesses," Anley says.
"The second objective is the security of supply, which is more associated with manufacturing APIs, less with finished or dosage
forms. I do not agree that local manufacture will lead to an increased security of supply. The economic realities are that
you will direct your capacity to markets where you will get the best price," he says.
John Norman, CEO of Nycomed South Africa a Takeda company
Policy supporters do not agree that favoring local manufacturing necessarily has a negative impact on prices. Nicolaou, from
PHARMISA, says, "Not everything that is imported is cheaper. In many cases, a locally produced product costs less than an
imported one. Furthermore, preferential procurement applies only to the public sector and public sector procurement is funded
with the national purse. Therefore, the cheapest price is not necessarily the most cost efficient to national funding."
One of the few multinational corporations (MNCs) with a manufacturing plant in South Africa is Sanofi. Its plant employs 300
people and manufactures both TB products and ARVs. "Primarily, there is customer need, and a need to use products made in
South Africa; thus, it generates employment," says John Fagan, general manager of Sanofi South Africa. "The other reason that
the government would want pharmaceutical manufacturing plants on South African soil is to ensure security of supply, as treatment
interruption in diseases like HIV and TB is a disaster."
DEALING WITH MARKET CHALLENGES
One of the biggest challenges that pharmaceutical manufacturers deal with in South Africa is the registration processes, which
can take as long as four years. Every delay in registration is delaying market entry, opportunities for generic companies,
competition, and lower prices.
The significant backlogs at the Medicines Control Council (MCC) are especially challenging for new companies. John D. Hallam
is chairman of Abex Pharmaceutica, Ltd., a strategic marketing and technical services company founded in 2006. He says that
regulatory delays can hold companies back. "There is a significant backlog in there which has slowed down the growth potential
of a new company. People on the ground need support from the top, which is very slow. If you already have an established company
with existing registrations, you can continue to live off that while you wait for new approvals. Abex is not that kind of
Roche's phelophepa mobile healthcare train brings primary healthcare to a different rural village in South Africa each week
Hallam says that regulatory improvement is not happening fast enough. "The Medicines Control Council and the Department of
Health need a serious shake-up. They have plans to change, but the implementation is not happening ... There is a management
issue there in my opinion, which the government itself sees, but as any huge organization, they are constrained by policies."
Roche's answer to registration delays is a Personalized Healthcare Concept (PHC), which takes patients from precise diagnosis
to targeted therapy. According to Erika Koppers, Roche's new South African head since January 2012, PHC actually helps to
reduce the time it takes to bring products to market.
MC Pharma: Facilitating Market Entry
Koppers explains, "By providing a targeted screening of patient groups, we are able to qualify patients and to predict in
a more precise manner that our medicine will work with a sub-group of a specific patient pool. As the medicines are so targeted
and the results are so fundamentally different from what we have seen before, these impressive results also convince regulators
to shorten the approval process. It is very exciting to see that patients can benefit much quicker than they would have otherwise."
According to Koppers, this concept "has great potential to improve medical decision-making and to not only offer clinical
benefits for patients but also economic benefits to regulatory authorities and funders."
Muhammad Bodhania, chairman of NAPM