Study forecasts growth in pharmaceutical sector

17 Oct 2023

The EU-Botswana Business Forum and Global Expo are viewed as a platform that could equally be utilised by the local business community to attract potential investors into the local pharmaceutical sector.

The pharmaceutical sector in Botswana was estimated to have a value of over P2.6 billion (US$193 million) by 2022 and a forecast of about P2.7 billion ( US$205 million) by 2025.

As such believed to be full of potential to stretch and penetrate the regional and international market.

A presentation on the findings from a study on Botswana Pharmaceutical Industry conducted by Africa Rise has identified some regulatory and industrial policy, management and skills gaps and other challenges hindering the industry growth and investor attraction.

The study mapped out the pharmaceutical eco-system, which was identified as an essential need in order to understand the potential of the pharmaceutical sector in the country.

Based on the study report, Mr Ricardo Godinez, Team Lead Consultant, Market Development and Pharmaceutical Expert with Africa Rise suggested a model and way forward for the pharmaceutical sector in the country as well as identifying investment opportunities.

“Once we know what Botswana has in terms of capacity, we want to have a model for Botswana to develop its pharmaceutical sector,” said Mr Godinez.

Another important discovery by the research team was that since the pharmaceutical sector was an emerging industry, there was varied information in terms of the country’s capacity to develop its pharmaceutical sector. In order to fully understand what the country has, the research team looked into developing a map of the pharmaceutical ecosystem of the country.

“We encountered from the investment part of the ecosystem and also civil society, more than 60 institutions, 32 pharmaceutical wholesalers, 38 colleges, 300 licensed community pharmacists and a network of medical centres through the 27 health districts in the country,” he said.

The study further identified strategic sub-sectors that could help develop the pharmaceutical sector and differentiate Botswana from all the countries in the sub-Saharan Africa.

He added that another important part of the study were the enablers that were required for Botswana to have a conducive framework for investment.

He said there was need for a policy that was specialised to cater for the pharmaceutical sector. “A more mature regulatory framework, comprehensive management, governance and harmonisation of the institutional structure as well as the right capacity to develop the sector,” he noted.

Mr Godinez added that there was a need for investment specialised to focus on the pharmaceutical sector as ingredients that were identified to trigger the sector.

The research team also considered prospects of increasing the market size for pharmaceutical products manufactured in Botswana. The study established that the ZAZIBONA, a cluster of countries including Zambia, Zimbabwe, Botswana and Namibia has an estimated market size of US$1.3 billion by 2022. However, the research team emphasized that for the ZAZIBONA members to profitably utilize their market, there was a need to specialise and avoid duplication by manufacturing similar pharmaceutical products.

“We also identified that the main dosage form that Botswana was supposed to focus on could the manufacturing of tablets,” said Godinez. He said tables accounted for the largest market size potion in the region.

Mr Godinez said there was an identified demand forecast of over 13 billion units of tablets within an estimated value of over US$400 million for Botswana, Zimbabwe and Zambia. He said looking at the fact that Botswana had minimal experience in manufacturing medicines but with more experiencing in repackaging and other sectors, the study identified that manufacturing of tablets could be the lowest hanging fruit for the country to consider venturing into.

The study had also identified that the pharmaceutical manufacturing sectors in the SADC region also represent one particular thing of assessment, which was that Botswana was not the only country aiming to manufacture medicines, as many other countries in the SADC region were also aiming to manufacture medicines.

In order to address the challenge, there was a need to look into the market segmentation. Also in Botswana, he said, it was necessary to look at how Botswana could differentiate from the other markets.

He said Botswana was one of the leaders within the sub-Saharan Africa region in developing vaccines. Through the Botswana Vaccines Institute (BVI), the country was already manufacturing six types of veterinary vaccines for export to 30 different countries for a value of around USD7.5 million.

“Having over 40 years of experience in the bio-pharmaceutical sector leverage it to also address the challenges of the region in the vaccine markets but also in the bio-pharmaceutical market,” he said.

Therefore, opportunities for investment were identified in the bio-pharmaceutical products. He said there was potential for expansion of the current veterinary vaccine production into the manufacturing of human vaccines presenting a significant opportunity in Botswana’s bio-pharmaceutical industry.

He said another potential opportunity available in Botswana was the one around the raw materials. Unlike the pharmaceutical manufacturers, currently there was no manufacturer of grade raw material that existed in Botswana. As a leader in the mining industry, he said Botswana was not leveraging on the sector into developing pharmaceutical grade ingredients/raw materials.

Additionally, he said products like salt, which was already produced in Botswana, could be upgraded into pharmaceutical grades. He said raw materials that could also be derived bovine origin, as the country was big in meat production, therefore meat production could be leveraged into producing pharmaceutical grades ingredients.

The study also revealed that the country could leverage on enhancing plant-based raw material. Herbal medicine was established as providing another huge opportunity in Botswana. Mr Godinez said Botswana has 47 plant species belonging to 45 genera and 29 families that were used to treat various diseases and health conditions. Currently, he said, there was a need to develop herbal products of high quality.

However, he said despite accessibility of indigenous herbal products, their affordability and effectiveness, there was lack of investment and limited scientific research in the field of indigenous medicine in Africa.

Even though some Botswana’s universities and other research institutions have conducted a lot of research on the use of traditional medicine, it does not translate into market opportunities. “We need investment in order to tap into and make use of the value in the sector,” he said.

As for key players in the development of Botswana’s pharmaceutical industry who were also enablers of the identified opportunities, Mr Godinez said organisations such as the medicines regulatory body, the Botswana Medicines Regulatory Authority (BoMRA), research organs such National agricultural Research and Development Institute (NARDI) and other parastatals as

Botswana Ash (BotAsh) and Botswana Meat Commission (BMC) among others, play a critical role.

The private sector was also established as a critical player in the development of the sector. He said the private sector could also be an enabler in the development of the sector as well as academic institutions who will also play a critical role by conducting relevant research. Though beaming with the potential to grow, Mr Godinez said the pharmaceutical manufacturing sector was not immune to challenges.

Among other challenges, the development of pharmaceutical sector in Botswana was restricted by the small local market and relying on imports only.

He said the primary challenge for the country would be addressed by developing a regional shared market. The need to create a conducive environment as well as lack of specialised pharmaceutical manufacturing policies and incentives were also identified as challenges limiting attraction of potential investors.

“We have realised that there are policies and incentives for manufacturing but there is a need for specialised policies and incentives for pharmaceutical manufacturing,” he said.

The study has also discovered that there was lack of transparency regarding data access for pricing, supply and demand of medicaments.

In order for Botswana to establish itself in the pharmaceutical industry, the study has advised that it must specialise in sophisticated niche areas. “Botswana could compete in the manufacturing integrity but will have minimal advantage against well-established manufacturers, therefore there is a need to consider sophisticated structures,” he said. ENDS

Source : BOPA

Author : Moshe Galeragwe

Location : GABORONE

Event : FEATURE STORY

Date : 17 Oct 2023