Is the Pharmaceutical industry in Africa fit for purpose?

Is the Pharmaceutical industry in Africa fit for purpose?

Put simply, such patients become repeat customers. In addition, drugs for cancer treatment comprise a large proportion of the pharmaceutical market in the industrialised world but only a tiny fraction in Africa. As people live longer in Africa, cancers are likely to become more prevalent, particularly as smoking becomes more common and meat consumption rises. Most pharmaceuticals have traditionally been researched and developed in the industrialised world at great cost, with manufacturers setting prices high in as many markets as possible in order to recoup their outlay.

However, this has placed key drugs out of the financial reach of many people in poorer countries. As a result, companies based in India and some other developing countries have produced copies of these drugs, known as generics, for sale outside the industrialised world, sometimes with the consent of the multinationals but often in conflict with them.

Generics are basically copies of established drugs but they are produced legally under international intellectual property law. Human rights groups have campaigned for the multinationals to lower their prices in Africa, or to adopt a more conciliatory position towards the production of generics.

Fragmented markets

There is some potential for multi-market drug marketing, given that a relatively small number of languages is commonly used in the health sector on the continent: English, French, Portuguese and Arabic. However, pharmaceuticals are still regulated on a national basis, so markets remain mostly small.

In the longer term, however, it would be helpful if regional regulatory bodies were set up, perhaps on the lines of regional trade blocs, such as the Southern African Development Community (SADC), East African Community (EAC), or Economic Community of West African States (Ecowas). The African Union’s (AU) Pharmaceutical Manufacturing Plan for Africa certainly encourages regional production, with countries coming together to fund research and development centres and cooperating on manufacturing.

It states: “Countries within a region may pool their resources together and form a regulatory system similar to the EU. Countries with weaker regulatory systems would then eventually up-scale their regulatory skills within this umbrella.”

Medical tourism

Medical tourism is a particularly interesting sector. India has established itself as a global centre for medical tourism, with patients paying less for travel and treatment in India than they would for treatment alone in their own countries. Some companies also include holidays within a period of recuperation that allows patients access to treatment if complications arise. In some cases, this also allows time for a checkup before patients return home. South Africa has established itself as the African centre for medical tourism, with many visitors staying for a safari, if their condition allows for it, or perhaps a beach holiday.

This service is one of the most obvious manifestations of globalisation, with consumers – otherwise known as patients – paying for medical services that are provided by skilled professionals living in lower-cost centres.

In theory it should result in the levelling out of global wealth and may also help to maintain medical facilities in the destination countries. However, at present, South Africa is also drawing wealthy patients out of other African countries, but in this instance it is because of the lack of treatment options in their own countries.

In addition, there is a growing trend of Africans opting for medical tourism to other countries. Farouk Gumel, a partner at PwC Nigeria, says: “Top medical tourist destinations include India, Europe, the US and the Persian Gulf. The Indian High Commission estimated that 47% of Nigerians who visited India in 2012 did so to seek medical attention, spending $260m on treatment: about $15,000 per medical tourist. Opportunities exist for investors to take advantage of the gap in Africa’s largest economy.”

He adds that estimates of the amount spent by Nigerians alone on medical tourism every year range from $500m to $800m.

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