Work on the deal started in July 2016 when Indian Prime Minister Narendra Modi visited South Africa, at which time a memorandum of understanding was signed by Cipla BioTec – a subsidiary of Cipla, focused on developing affordable biopharmaceuticals – and the Dube TradePort Special Economic Zone, an area of South Africa designed to drive investment and industrial development in the country. The deal was finally agreed after the 8th BRICS Summit in Goa, India in October 2016.

The facility will be run independently from Cipla’s existing manufacturing division in South Africa (Cipla Medro Manufacturing) and follows the launch of Cipla’s ‘Distribution Gateway’ drug distribution centre in Cape Town during 2015, which required an investment of over US$12 million.

The facility will be the first of its kind in South Africa, which implemented a fast track registration policy for generic medicines in 2003 [1] in an attempt to increase access to generics.

The manufacturing unit will produce affordable biosimilars for the treatment of cancer and autoimmune disorders. According to Cipla BioTec, only 8% of patients with advanced cancer and autoimmune disorders are able to access the treatments they need due to prohibitively high costs. This is a particular problem in South Africa, where a breast cancer patient could pay US$35,000 a year for treatment. As a result, those without private healthcare have little chance of accessing biologicals. In fact, only 1 in 50 do. By producing biosimilars in the country, Cipla BioTec hopes to increase this number to 1 in 5.

The agreement has been described as a priority by the Inter-Ministerial Committee on Investment, chaired by South African President Jacob Zuma, and is strategically important for the nation’s efforts to innovate and advance its manufacturing capabilities. A representative of the Ministry of Trade and Industry said it would not only enable the provision of affordable healthcare but also bring socio-economic benefits to the country and strengthen its ties with India.

The investment totals over US$90 million and will create up to 300 jobs, including 180 permanent roles, in the region. Beyond employment, the new manufacturing technology has the potential to have a wide-reaching impact on the country, including improving the quality of research. There is also the potential to target external markets, including Asia, EU and the US, contributing further to the country’s economic growth.

According to Cipla, the state-of-the-art manufacturing site means the creation of Africa’s first ‘bio-cluster’ and will attract world-class research efforts. Construction will begin in early 2017, with full operations due by the third quarter of 2018.

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Reference
1. GaBI Online - Generics and Biosimilars Initiative. South Africa’s expedited registration policy for rapid access to critical medicines under threat by generics [www.gabionline.net]. Mol, Belgium: Pro Pharma Communications International; [cited 2016 Nov 25]. Available from: www.gabionline.net/Generics/Research/South-Africa-s-expedited-registration-policy-for-rapid-access-to-critical-medicines-under-threat-by-generics

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