Donwald Pressly
South Africa’s pharmaceutical industry has adopted a wait-and-see attitude to the ANC’s proposal that a state-owned company be set up to compete with the private sector.
This follows the announcement earlier this week by ANC secretary general Gwede Mantashe that the party’s national executive committee (NEC) had asked the cabinet to look into the creation of a state-owned pharmaceutical company.
This would give effect to a resolution taken at the Polokwane ANC national conference in 2007 aimed at exploring the feasibility of setting up such an entity. The main motivation was to lower the prices of drugs, particularly antiretrovirals.
Aspen Pharmacare senior executive Stavros Nicolaou, who attended the relevant commission at the ANC conference that had discussed the issue, noted that the word applied to the proposal was “feasibility” and that the idea of a state-owned pharmacy was not new.
However, it remained difficult to comment until there was a report issued on the feasibility or otherwise of the entity, he said, adding that the NEC was required to report to the elective national conference at the end of next year, but there might be a written report produced before then.
Asked whether Aspen Pharmacare’s business would be threatened as it provides the bulk of the HIV drugs for the state’s fight against Aids, Nicolaou said the state had always been interested in producing active pharmaceutical ingredients that went into the antiretroviral drugs, while Aspen was involved in manufacturing the final product.
Depending on whether this envisaged state-owned pharmacy produced these ingredients competitively, Aspen would be “free to procure from wherever it wishes”.
Raseela Inderlall, the executive director of the National Association of Pharmaceutical Manufacturers, also said it was difficult to comment at this stage until “we know the details”. She said it was “hard to say whether it would be feasible or not”.
Other pharmaceutical industry players indicated that one of the major motivations for the proposal was concern over high drug prices. These had been effectively pulled down as a result of state intervention and regulations by the Department of Health.
“Medicine prices have, indeed, come down in general in South Africa. The government has put in so much time and effort and it has had a positive impact… I do wonder if it is necessary to open up a state-owned company,” one industry insider said.