Uganda exports 70 tonnes of ARVs to Namibia
Saturday April 16 2016
The shipping of 70 tonnes of anti-retroviral medicines worth $4 million by Uganda’s Cipla Quality Chemicals Ltd to Namibia last week — the single largest export order for an East African pharmaceutical company — has been hailed as a game-changer for the Kampala-based drugs maker.
Quality Chemicals broke into regional markets in 2011 when its drugs were bought by Global Fund, to fight HIV/Aids, tuberculosis and malaria in Kenya. Later, the company exported drugs to Tanzania, South Sudan, Zambia, Cameroon, Comoros; Namibia is its seventh export market.
Company officials told The EastAfrican that the deal was reached after six months of bilateral negotiations with Namibia’s Ministry of Health.
Uganda’s Trade Minister Amelia Kyambadde flagged off the consignment of ARVs on April 7. She said that at a time when sub-Saharan Africa is still grappling with HIV/Aids, the pharmaceutical company was hitting the right notes by making quality and affordable drugs both for the local and export markets.
“Namibia can buy from any pharmaceutical company that manufactures health care products, but it chose to buy from Uganda because of quality and affordability. Manufacturing efficiency enables us to compete with any manufacturer,” said Quality Chemicals chief executive officer Nevin Bradford.
Officials of the firm — which also manufactures anti-malarials and Hepatitis B drugs — are optimistic that the company will continue to break into more export markets and grow its revenues.
“After this, there will be more consignments. The exports target for the year could be $20 million,” said Mr Bradford, adding that in two weeks’ time, the firm will export drugs worth $2 million to Zambia.
This is in addition to the drugs that the pharmaceutical company supplies on the local market, to the tune of $40 million per year.
Namibia has a population of just 2.3 million people, but, according to 2014 UNAids estimates, the southern Africa country had 250,000 people living with HIV. Of these, some 119,442 including children were receiving anti-retroviral treatment.
Axel Tibinyane, Namibia’s permanent secretary in the Ministry of Health and Social Services said there had been short supply of ARV drugs, and the consignment would maintain the country’s stocks for at least six months.
Quality had struggled to get a foothold in the region since 2007, despite attaining international certifications from the World Health Organisation.
Ms Kyambadde said government was duty bound to negotiate and guarantee access to markets such as Namibia and Cameroon that are outside the trading blocs to which Uganda is a member state.
She said products manufactured in Uganda already have access to the Common Market for Eastern and Southern Africa (Comesa) and East African Community (EAC) markets, but access to markets in the Southern African Development Community (SADC) still requires bilateral negotiations.
“That’s why we have been actively negotiating the tripartite arrangement that brings together the SADC region — where Namibia belongs — Comesa and the EAC,” she said.
The three economic blocs launched the Tripartite Free Trade Area (TFTA) in Sharm El Shiekh, Egypt, last June.
Although it was launched before finalising outstanding issues on elimination of import duties, trade remedies and rules of origin, the TFTA — which brings together 26 African countries — is the first step towards establishing the ambitious pan African free trade area by 2019.
Linking trade issues and health rights, Michel Sidibe, the UNAids executive director and UN undersecretary general emphasised the need for the government’s support in establishing such markets in order to develop Africa’s own supply and reduce dependence on foreign suppliers and donors.
These blocs are huge markets for consumer goods, and significantly for pharmaceuticals. The 19 member states of Comesa make up a market of 490 million people covering 80 per cent of sub Saharan Africa, the world’s most HIV/Aids affected region. In 2009, Comesa had an import bill of pharmaceutical products worth $2.6 billion against total exports of $267 million.
Quality Chemicals executive director Frederick Kitaka said the company is already negotiating with Burkina Faso to access the West African country’s market and supply ARVs to them.
With continued similar export quantities and access to markets, the pharmaceutical industry in Uganda and the region will be able to experience economies of scale that will help the industry grow and in turn benefit consumers with lower prices.
“Low economies of scale is a challenge, then there is competition with Indian and Chinese producers who have economies of scale. This is why we need these markets and more investors,” said Mr Bradford.