Despite its inherent promise, the Zambian pharmaceutical manufacturing sector is severely constrained. According to a report by the Business Regulatory Review Agency (2022), only 10 registered companies produce medicines locally. Of these, 7 are involved in actual production, whereas the remainder repackage imported products. This statistic is against the backdrop of colossal domestic demand, resulting in a huge medication import bill for the Government and citizens.
An inability to meet domestic demand for medicines is not unique to Zambia. Indeed, as a continent, Africa is a long way off from attaining self-sufficiency in this respect. The African Development Bank estimated expenditure on the continent for pharmaceutical imports at $14 billion per annum, representing 70% of demand. The manufacturing that does take place, represents a meagre 3% of global output. There is only one pre-qualified vaccine production institute on the continent, whilst it is only in South Africa and Morocco where more than 70% of local demand is met domestically.
Despite these underwhelming facts, there are bright spots on the continent where Governments are now prioritizing their medicament supply chains. One such country, which will be the focus of this article, is Kenya.
Before making reference to the successes, allow me to detail the regulatory framework governing the pharmaceutical sector in Kenya. The overarching policy is the Kenya National Pharmaceutical Policy (KNPP), which places health at the core of social and economic development. The KNNP aims to make Kenya a hub for pharmaceuticals in East Africa with a reach throughout the continent. It identified several weaknesses in what had been obtained from prior policies. The oversight function, for instance, dated back to the pre-colonial era, rendering it inefficient in regulating the highly complex and diverse medicine supply value chains of today. The resolution of this involved numerous efforts but largely centred on de-linking medicines, in general, and pharmaceuticals and their oversight functions in separate state apparatus.
The KNPP further sought to incentivize the local manufacture of drugs. This was done through an array of exemptions from taxes on raw materials and those required for packaging. Additionally, the sector benefited from a 15% preference for local procurement. Efforts were also made to remove bureaucratic bottlenecks through harmonization and streamlining of relevant statutes.
Additionally, the creation of partnerships has been central to the implementation of the KNPP. The Kenyan Government has signed a cooperation framework with South Korea in the area of vaccine production. This will allow for the exchange of technology, expertise and finances. Beyond bilateral agreements, the Kenyan Government has sought to become a state party to the International Vaccine Institute.
As a result of these and other measures, significant successes have been recorded, particularly in recent times. In March 2023, Moderna, an international pharmaceutical and biotechnology firm, announced that it was setting up its first vaccine facility on African soil in Kenya. This facility, expected to have a capacity of 500 million doses per annum, will also allow for scalability in the face of a disease outbreak on the wider continent. Only one month ago, Kenya Airways was certified by the International Air Transport Association to carry temperature and time-sensitive pharmaceutical products, a development which will allow for increased exports into the region and the wider continent.
Whilst there is much growth yet to be attained in the Kenyan sector, what has been achieved so far is commendable and should serve as a model for other countries on the continent, Zambia included if import dependency is to be reversed.
Healthy populations will be crucial to the development aspirations of our country and our continent. As the Zambia Association of Manufacturers, we remain resolute in our advancement of the local pharmaceutical sector. We stand ready to play a pivotal role in unencumbering the activities of local producers and alleviating the many challenges they face. We see the sector as central to our aspirations of creating a modern and efficient manufacturing industry, something we hope to do in an enabling and conducive environment comprising of both fiscal and non-fiscal incentives like local sourcing.
The Author is the Chief Executive Officer at the Zambia Association of Manufacturers
