Two decades later, Africa finds itself slowly emerging from the perils it once faced. The key driver is economic growth, which
has raised living standards and consequently increased demand for health services. A 2011 report by the African Development
Bank found that the ranks of Africa's middle class increased to 34 percent of the continent's population in 2010—nearly 313
million people, equivalent to the population of the United States. The continent's urban population is also projected to exceed
that of China and India by 2050, according to UN figures. Along with greater political and fiscal stability and improvements
in pro-business legislation, the UN forecasts that foreign direct investment (FDI) in Africa could more than double in 2014
compared to a decade ago.
Since 2000, healthcare spending has grown at a CAGR of 9.6 percent due to government, NGO, and private sector investments
in system infrastructure, capacity building, treatment provisions, and specialized services. While infectious diseases like
HIV/AIDS and tuberculosis still remain a significant problem, the changing economic profile of Africa has led to an increase
in non-communicable diseases (NCDs), such as cardiovascular and respiratory disorders, cancer, and diabetes, and as a result,
a growing demand for chronic care drugs. The World Health Organization (WHO) estimates that by 2020, the biggest increases
in NCD deaths will occur in Africa.
This observation by a leading local health practitioner is telling. "In 2003, the beds in our new HIV/AIDS wing at KCMC were
filled with HIV/AIDS patients whose disease was not under control. Since the introduction of affordable anti-retrovirals that
decreased the disease burden, those beds are now filled with diabetes patients," Mark Swai, MD, former Hospital Director
of KCMC, told Pharm Exec.
Increasing individual wealth, a somewhat stronger health system infrastructure, and rising demand for drugs treating chronic
diseases are driving up sales of pharmaceuticals. By 2016, annual pharmaceutical spending in Africa is expected to reach $30
billion—surpassing the United Kingdom.
But how different is the Africa of today when it comes to healthcare provisions?
There is no doubt that there are promising changes ahead, yet one crucial component of a sound healthcare system lags: a weak
infrastructure, especially in primary care, accentuated by a shortage of facilities and trained staff, limited disease awareness,
and frequent changes in regulatory and distribution rules. As in most other areas of the African economy, creation of an efficient,
boundary-less regional market in medicines remains elusive.
Take the doctor to patient ratio for example: according to the most recent World Bank figures available, Mozambique has less
than one physician per 10,000 people, as does Gambia, Ghana, and Ethiopia. South Africa has less than one physician per 1,250.
Compare this to physician population ratios of one to 300 and one to 425 for France and the United States, respectively. With
such a low physician to patient ratio, prescriber-focused sales and marketing tactics are not practicable. Combine this with
a still poorly understood heterogeneous market and a decision chain that is notably hard to navigate and you have to ask if
a long-term integrated business strategy is possible within these current infrastructure limitations. It follows that the
most important question of the moment for pharma investors is: what commitments and level of spending are necessary to overcome
these limitations and leverage the region's full market potential?
"There are clear improvements since the early days of the HIV/AIDS epidemic. However, the needs keep changing. What was put
in place to treat infectious diseases is not what is needed to keep diabetes patients out of the hospital today," said Swai.
Swai's story illustrates how the evolving disease landscape in Africa has exceeded the capacity of health systems to adapt
and respond to a new crisis in chronic care, resulting in unnecessary complications for patients and added operational and
financial burden on African hospitals.
One fact for Big Pharma is clear: While the role of the pharmaceutical sector in Africa is undoubtedly changing, the need
to ensure that private-sector initiatives support and drive infrastructure improvements remains essential. It is the single
most important element in a long-term, sustainable market access strategy for Africa.