Africa’s pharmaceutical markets are growing in every sector as the industry is undergoing a period of very significant transformation, but more funding was necessary to expand further.

This was said at the high-level panel discussion on the theme “unleashing the potential of pharmaceuticals in the socio-economic transformation of Africa” which saw heated discussions on financing and challenges of pharmaceuticals in the continent.

Chaired by Fatima Haram Acy, African Union Commissioner for Trade and Industry, the forum that was held as a sideline event during the African Development Week at the UN Economic Commission for Africa (ECA), the pharmaceutical industry currently represents a highly competitive environment.

“Although developing countries at the moment have a small portion of world pharmaceutical sales, these countries also have a significant potential for the industry in the future,” she said.

Some positive reforms are also taking place in the continent. For instance, the South Africa national policy on intellectual property reform, which will bring broad changes to its patent laws, favour local manufacturing and the expansion of ARV provision to people living with HIV, according to Fatima Haram Acy.

The global market for pharmaceuticals has been growing at an average rate of five to seven per cent over the last five years and is expected to hit $1 000-billion in 2016.

To capture 10pc of this market, Africa has to get adequate funding.

Given that Africa consumes less than one per cent of global health expenditure and manufactures locally less than two per cent of the medicines it consumes.

However, the African pharmaceutical sector is expected to grow tremendously in the coming years. With a compound annual growth rate of more than 10pc, Africa is the second most dynamic pharmaceutical market after Asia Pacific, with a pharmaceutical spending expected to reach 30Bl$ in 2016 and 45Bl$ by 202.

However, there needs to be a structural change in the industry to establish a new strategic alliances and joint ventures as lack of finance capability has been identified as the reason why pharmaceutical firms have not fully exploited opportunities, according to Souleymane Abdallah, Regional Integration and Trade Division at UN ECA.

Hence, aiming at creating a proper platform that can totally integrate policies and enterprises in medical and healthcare field between Africa and China, the China Africa Development Fund (CADFund) announced a medical and health investment platform.

The new-style cooperation pattern between China and Africa in medical and health care industry, which will in place at the end of this year, should emphasise the regulation and administration of medicine quality and production safety, according to Si Chen, Director for Manufacturing Investments at CADFund.

“The collaboration between the regulators must be ahead of the upcoming broader and deeper cooperation whether in trade or investment. Meanwhile, we hope that the international organisations will endorse the exact projects,” she added.

In her preliminary statement, Fatima Haram Acy briefly described the pharmaceutical industry in Africa as hardly accounting for two per cent of the world’s pharmaceutical market. She then underscored the importance of mobilising resources to finance it.

The Pharmaceutical Manufacturing Plan for Africa (PMPA) business plan under the Africa Health Strategy and the Accelerated Industrial Development in Africa (AIDA) is the framework within which this agenda is being promoted on the continent.

“Despite the challenges that continue to hamper speedy progress, Africa is making strides in the right direction in its manufacturing capacity and is poised to harness the opportunities,” Fatima Haram Acy said.

Some panelists said that for Africa’s pharmaceutical industry to develop, it must create an enabling environment through easing access to capital for investment, envisaging properly designed incentive measures, strengthening control of the regulations governing Africa’s markets and pharmaceutical industry, while at the same time enabling African businesses to accede to expertise and technology.

For others, there is need to fast-track implementation of the Pharmaceutical Manufacturing Plan for Africa adopted by the Heads of State and Government of the African Union, a Plan that will enable Africa to become less dependent on imports and thus gain in autonomy.

According to the plan, a stronger and more reliable local pharmaceutical industry will also contribute to economic development, job creation, and development of human resources and of related industries.

The discussions that followed the panel presentations concluded that there is need for Africa to equip its pharmaceutical industry with practical knowledge that will enable it manufacture medicines compliant with international standards and at competitive costs.

Africa needs external capital for investment at affordable rates. “China is ready to enter into win-win partnerships that will allow all African countries to develop strong pharmaceutical industries,” said Si Chen.