Guest Articles

Wednesday
April 13
2022

Biodun Awosusi

On the Path to Self-Sufficiency: How Development Agencies Can Support the Local Production of Health Products in Africa

Africa imports 99% of the routine vaccines consumed on the continent, and most sub-Saharan African countries import as much as 70-90% of all medicines used. The ongoing COVID-19 pandemic has shown the risks of this continued over-dependence on imports for access to tests, drugs, vaccines and other vital health supplies. Fortunately, there is reason to believe that this situation is changing: With the launch of the Partnership for African Vaccine Manufacturing in April 2021, there is growing support from governments, multilateral institutions and philanthropies for the local production of vaccines and other health products.

There is also an opportunity for development agencies to play a crucial role. Agencies like the United States Agency for International Development, the U.K.’s Foreign Commonwealth and Development Office, Germany’s GIZ and the French Development Agency – along with development finance institutions and other similar organizations – can support emerging initiatives to boost Africa’s capabilities for domestic manufacturing, while also creating jobs. To that end, based on my experience working on the projects of implementing organizations financed by multiple aid agencies, I propose three areas of potential impact.

 

Strategy Development for the Local Production of Health Commodities

Africa’s double burden of infectious and non-communicable diseases, health security needs, and precarious geopolitical landscape underscore a compelling case for countries to invest in the sustainable local production of health and pharmaceutical products. Export restrictions for health commodities in the early phase of the COVID-19 pandemic adversely affected the smooth implementation of public health measures in many African countries, causing substantial economic damage. And the ongoing global inequity in access to vaccines is delaying economic recovery. As the Managing Director of the International Monetary Fund, Kristalina Georgieva, recently noted, “robust and reliable vaccine capacity in Africa is a global public good, deserving of global support.” But building this capacity requires strategy development at both the national and continental levels.

To that end, the Partnership for African Vaccine Manufacturing provides a framework to facilitate the development of regional production hubs, to enable each country with ample political will, research capabilities and private sector interest to develop a strategy that aligns with its national health and development plans. This approach helps to situate efforts to enhance production capacity within countries’ broader health, industrial and economic policies. South Africa’s Bioeconomy Strategy is a good example: It provides a national blueprint to scale the contribution of biotechnologies to gross domestic product, including the expansion of the pharmaceutical industry to meet domestic and continental needs. Development agencies can support similar government-led strategy development processes in other African countries, grounded in evidence, thorough needs assessment and pragmatic context-specific solutions.

 

Institutional and Enterprise Support for Biotech Development

In a recent Nature article, a group of eminent health researchers and economists propose that ‘’investment in scientific, regulatory and technological capacity must be a higher political priority in countries at all levels of development.’’ This goal should underpin institutional support and enterprise investment for the development of Africa’s biotech and life sciences industries, which can happen through several approaches. For instance, despite their fiscal constraints, African governments should increase their research investments and create the right environments for enterprises to thrive. Development agencies can support the creation of biotech incubators and hubs. And as these biotech hubs facilitate talent concentration, research commercialization, enterprise development and access to capital, interrelated institutions of competitive importance can be aggregated into clusters, to build a viable industry that addresses unmet needs.

For example, Nigeria’s Co-creation Hub, founded over a decade ago, has accelerated the development of a reputable local technology ecosystem, with innovative enterprises that have attracted significant domestic and foreign investments. And in South Africa, the World Health Organization and its partners launched a consortium in 2021 which has emerged as a global mRNA vaccine technology transfer hub: Multiple countries were recently announced as recipients of its technology. These hubs show the growing capabilities of African entrepreneurs and scientists in tackling critical challenges – with the right support.

The case for the self-financed development of Africa’s health industry is compelling, but access to foreign capital aligned with African priorities remains crucial – as exemplified by recent investments in Aspen Pharmacare and 54Gene. A new analysis by the Organization for Economic Cooperation and Development shows that donors spent at least $6 billion on COVID-19 vaccine access for developing countries in 2021. According to Briter Bridges, the continent attracted over $4 billion in venture capital in 2021, and health and biotech investments ranked second, behind fintech. Highly productive hubs in conducive business environments can generate new investments, and aid agencies can support this early-stage enterprise development with catalytic capital, enabling more long-term co-investments. They can also facilitate knowledge exchange with players in renowned biotech hubs such as Boston (U.S.), Munich (Germany), Genopole (France) and the Golden Triangle (U.K.).

 

Market Access for African Health Products

Several innovations have emerged in the continental response to the pandemic, which can help bring high-quality, made-in-Africa health products to local and international markets. One of them is the African Medical Supplies Platform – an e-commerce platform that connects producers with institutional purchasers. Another one is the African Vaccine Acquisition Trust, which aggregates vaccine sourcing and procurement. A related development is the imminent operationalization of the African Medicines Agency, to ensure regulatory harmonization and boost access to safe and effective health products. With these new resources, as countries implement their national strategies and domestic producers and innovators emerge from hubs, clusters and economic zones, they can gain access to pooled procurement platforms and new markets. Additionally, ongoing progress on negotiations for the African Continental Free Trade Area promises to support further value chain development.

Development agencies are well-placed to make a significant difference: They finance multi-year projects and programs across several countries involving the large procurement of medical supplies, so they can support healthcare value chain development and facilitate local producers’ access to international procurement systems. The expansion of local production of health products is congruent with wider calls for the decolonization of global health, and the increasing agency of local civil society organizations and other non-state actors. The multiple vital initiatives created to facilitate equitable and timely access to health products to support the continent’s pandemic response are signs of a “new public health order,” in which African institutions can work effectively with development partners to address African challenges.

As this progress makes clear, Africa has begun the long journey towards self-sufficiency in its health supply chains, and the region’s health markets are primed for further growth and innovation. With the support of development agencies and other global partners, this momentum promises to reshape public health on the continent.

 

Editor’s note: This article is part of NextBillion’s “Recovery” series, which explores how businesses, development initiatives and the communities they serve in low- and middle-income countries are building greater resilience for a post-pandemic future.

 

Biodun Awosusi is Director of the Capacity Investment Lab and Health Economist at Health Systems and Development Enterprise.

 

Photo courtesy of GCIS.

 


 

 

Categories
Entrepreneurship, Health Care
Tags
business development, coronavirus, global health, healthcare, manufacturing, pandemics, supply chains, vaccines