No obvious cure for local medicine makers

Robert Laing

Robert Laing

"The pharmaceutical manufacturing sector in South Africa is in crisis (due to) declining investment, legislative and regulatory chaos, (and) plant closures."

This was the conclusion of the Pharmaceutical Manufacturing Sector Study commissioned by National Economic Development and Labour Council (Nedlac) seven years ago.

Since then, 5000 more jobs have been lost in this sector, bringing the employment level to about 11000, according to a new study by Genesis Analyticals.

Genesis said the report is still in draft form and declined to comment.

Business Report said Genesis found that 35 local pharmaceutical plants had been closed since 1994.

Some blame government red tape. The South African government is attempting to meet the highest international standards by adhering to Pharmaceutical Inspection Convention and Pharmaceutical Inspection Co-operation Scheme.

But only one local pharmaceutical manufacturing facility, Enaleni's Durban plant, appears to have been closed by the state regulator, Medicines Control Council.

Adcock Ingram managing director Jonathan Louw stopped an industry rumour that government red tape was to blame for the group's decision to close its Clayville manufacturing facility.

"We were a closed economy, but now we have to compete where we can," Louw commented.

The Clayville factory was out of date, as were many of the local pharmaceutical factories closed by their new multinational owners.

Government is believed to have commissioned Genesis to study the pharmaceutical industry after becoming alarmed that imported medicines are now the fifth largest contributor to this country's balance of payments deficit.

Louw pointed out that South Africa only represented 0,35 percent of the global pharmaceutical market.

"We don't have the economies of scale to make most of our own medicines locally," he said.

"Multinationals are increasingly creating centres of excellence for their pro-ducts, and we have to do the same," Louw added.