The South African pharmaceutical industry, like many developing countries, faces many significant developments and new challenges. Some of these challenges and developments include the growth of generic medicine and the proposed National Health Insurance (NHI) scheme which is set to have major implications for the pharmaceutical industry.
In addition, increased regulation and legislation, such as single exit price, the dispensing fee, the Consumer Protection Act and the Medicines and Related Substances Control Act will continue to impact on the marketing, distribution and packaging of pharmaceuticals.
Once dismissed as low-profit, the country’s pharmaceutical market is now regarded by many as having great potential and is drawing the attention of some key industry players. The optimistic outlook can be attributed to heavy investment in the private sector. Largely due to the growing burden of disease and increased public healthcare spend for advancing the use of high-priced drugs.
In the coming years, a large number of drugs will lose their patents, which is expected to create higher demand for primary health care drugs such as generics, antibiotics and over-the-counter drugs. Likewise, the lucrative government contracts for HIV/AIDS, tuberculosis and diabetes medication as key drivers for the industry.
South Africa has the highest proportion of people with HIV/AIDS in the world. 2010 figures indicate that over 5-million residents have the virus and 40% of deaths in 2010 were HIV/AIDS related. Government receives international support for antiretroviral (ARV) supply and other initiatives to help people living with the disease from organisation such as Global Fund, the President’s Emergency Plan For AIDS Relief (PEPFAR) and the EU. The result is lucrative government contracts awarded to companies that provide appropriate treatments for the HIV/AIDS pandemic, Tuberculosis and other diseases.
This is hailed as a move in the right direction by many, most of whom previously condemned the MCC’s lengthy registration process for making it difficult to introduce cheaper generic drugs. This was highlighted as a major obstacle to Fixed Dose Combinations (FDCs) for HIV/AIDS treatment.
Despite all these challenges, the South African healthcare industry is in the initial stages of development and has immense growth potential. The forecast is based on high demand for hospital services and healthcare professionals, and South Africa’s dependence on imported pharmaceuticals. This sets the stage for the private sector to build infrastructure and manufacturing facilities. Based on current market trends, industrial developments and competitive landscapes, the South African pharmaceuticals and healthcare industry has a bright future ahead.