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In recent years, Big Pharma companies have shown increasing interest in setting up manufacturing in India and the Far East. The advantages of this outsourcing trend are obvious - decreased costs, coupled with ever increasing standards of operation. However, as the technological and quality of life aspirations of these new locations increase, the attractive cost advantages could dwindle and cause pharma companies to look elsewhere for manufacturing locations. Perhaps, they will consider Africa.
In recent years, Big Pharma companies have shown increasing interest in setting up manufacturing in India and the Far East. The advantages of this outsourcing trend are obvious — decreased costs, coupled with ever increasing standards of operation. However, as the technological and quality of life aspirations of these new locations increase, the attractive cost advantages could dwindle and cause pharma companies to look elsewhere for manufacturing locations. Perhaps, they will consider Africa.
This is an interesting prospect. Public perception has long been that drug companies have neglected Africa — first by failing to invest much in malaria and other tropical diseases and, more recently, HIV/AIDS. They are seen as being preoccupied with the maladies of the affluent West: cancer, heart disease, diabetes and obesity. Even when they invented antiretroviral drugs (ARVs), making AIDS a chronic disease rather than a death sentence, the prices put them far beyond the reach of those who needed them most. HIV/AIDS claimed approximately two million lives in Africa in 2006 —several years after ARVs were introduced onto the market.
However, AIDS has finally concentrated the minds of Big Pharma upon Africa, and initiatives happening there today might just form the basis for building manufacturing, and more, on the continent in the future. Companies can always adopt the humanitarian principle of distributing ARVs and other needed drugs free of charge, or at preferential prices, from existing manufacturing locations. Some good has already come from such schemes; Merck's free distribution of ivermectin has saved more than half a million people in West Africa from river blindness, but this approach now seems paternalistic when the pharma business, and so much else, has gone global.
Pharmaceutical pricing, intellectual property (IP) and licensing are difficult issues for an industry suffering a productivity crisis in relation to its R&D investment, and these all impinge on improving healthcare in Africa. Despite this, there are now several ARV manufacturing partnerships underway in African countries between Big Pharma and local companies, according to Guy Willitts of the Geneva-based International Federation of Pharmaceutical Manufacturing Associations (IFPMA). These are described in the IFPMA's report 'Partnerships to Build Healthier Societies in the Developing World'. Such operations could mark the beginnings of a pharma industry in Africa.
Some companies have issued voluntary licences to allow local manufacturers to make cheap generic versions of their ARVs. This type of arrangement works best in locations where there is a severe HIV/AIDS epidemic, but possesses an adequate healthcare infrastructure, a relatively stable local economy and appropriate manufacturing expertise. The parent companies want to be sure that the local operation can ensure a long-term supply (ARV treatment is usually for life) of high-quality drugs that will go to those who need them. Safeguards against both counterfeiting and diversion of product to wealthier markets need to be addressed in this situation as well.
According to the IFPMA report, Bristol-Myers Squibb now has a tech transfer agreement with generic company Aspen PharmaCare of South Africa on its latest ARV, atazanavir, which has involved IP and technical know-how related to manufacture, testing, packaging, storage and handling of the API and finished dosage form. Aspen is now working on regulatory submissions for sub-Saharan Africa.
Meanwhile, GlaxoSmithKline (GSK), the world's largest supplier of HIV/AIDS drugs, granted its first voluntary licence in 2001 and now has eight such agreements for its ARVs in Africa, which includes one with a company in South Africa. Last year, GSK significantly increased manufacturing capacity in Africa to supply larger amounts of ARVs at lower prices and it is currently the only Big Pharma company that manufactures products in East Africa. Its regional manager John Masunga is also chairman of the Kenyan Association of the Pharmaceutical Industry and there are now similar organizations in Morocco and South Africa, suggesting that the foundations of a new industry are being built — at least in some parts of Africa.
In 2005, Merck granted a nonexclusive, royalty-free patent licence for manufacture and supply of a generic version of its ARV, efavirenz, to Aspen PharmaCare, while last year Roche committed to a new 'AIDS Technology Transfer Initiative' to help manufacturers in the Least Developed Countries (as defined by the United Nations) to produce their HIV protease inhibitor saquinivir. In September 2006, they announced tech transfer agreements with three African companies.
Meanwhile, the Association of British Pharmaceutical Industries recently published a report 'Global Health and the Pharmaceutical Industry' that suggests work upstream and downstream of pharmaceutical manufacturing is also occurring in Africa. One example is Pfizer's project with the World Health Organization's Special Research Programme for Research and Training in Tropical Diseases (WHO-TDR), which provides WHO-TDR access to a section of Pfizer's compound library for screening against a range of tropical diseases. African scientists are also working alongside people at Pfizer to analyse screening results to select compounds worthy of further development. These skills can be transferred back to their home institutions to build up their tropical disease research capacity. Pfizer is also partnered with Makerere University (Kampala, Uganda) international infectious disease experts, the government of Uganda and a number of nongovernmental organizations in the Infectious Diseases Institute (IDI). The aim of this initiative is to strengthen local capacity in HIV/AIDS care and train doctors from several African countries in the often complex business of administering ARVs. IDI houses a state-of-the-art diagnostic lab that helps monitor HIV therapy and diagnose the opportunistic infections that often accompany HIV, as well as tropical and sexually-transmitted infections. Meanwhile, AstraZeneca is working for better diagnosis and management of breast cancer among women in Ethiopia, Abbott is funding paediatric AIDS clinics in Africa and elsewhere, while Novartis, through its Foundation for Sustainable Development, is working with the WHO to eliminate leprosy through education, diagnosis and distribution of multidrug therapy.
Of course, the pharmaceutical industry could — and should — do more in Africa. The healthcare needs of the population must come first and fulfiling this goal could also make Africa a place where drug discovery, development and manufacture are conducted. This would help the industry with its global aspirations and could even improve its public image.