We saw in our recent articles that supply chain disruptions force countries to redefine their sovereignty policies in pharma. Policies have paved the way for local and global players to establish partnerships, such as Vision 2030 in Saudi Arabia. Last week, we learned that Sanofi is partnering with Sudair to produce insulin, a major move for the country, that is looking to be self-sufficient (see our article: Is Saudi Arabia on the path of self-sufficiency?).
Similar moves are occurring in other MENA markets, let’s have a brief look at Egypt.
In Egypt, authorities have implemented a currency devaluation leading to higher prices, notably in medicines. Access to drugs have suffered, diabetes medications have been difficult to find in pharmacies.
Egypt is a significant market in pharmaceuticals, shining through the MENA region and Africa. It boasts dynamic local players like Eva Pharma, which made the headlines with the recent agreement to manufacture Gilead’s AIDS drug lenacapavir.
Partnerships to prevent future shortages
The government inaugurated Gypto Pharma City in 2021, a land development plan with the ambition to produce 95 new pharmaceuticals by the end of 2024. Abbott has already reached an agreement with Egypt to produce 155 million packs of analgesics and antibiotics, over the next 5 years.
Bayer has also committed in the long term in Egypt, where it plans to localize 80% of its consumer health products by the end of 2029. 3 products from Bayer are already manufactured and marketed in Egypt, soon to be joined by allergy medicine Claritin, expected by the end of 2024. Bayer’s VP for Middle East and Pakistan estimates that the consumer health import bill dropped by USD 12 billion.
There is also an ongoing deal between Eli Lilly and Eva Pharma to increase access to insulin in Africa, by which Eli Lilly supplies insulin API at a reduced price and a tech transfer for formulation, fill & pack. A new deal has been struck between the 2 players to expand access to JAK inhibitor Olumiant, but in this case the entire value chain is supposed to be localized.
API is key
While local manufacturing is strong with 150 drug factories, Egypt relies on imports: 80 to 90% of raw materials necessary to manufacture drugs are produced abroad. The country is dependent to India, China…
The need to produce raw materials in Egypt is thus increasingly critical. Pushing local players as well as attracting specialized foreign investment in API, with dedicated incentives is required. Suez Canal Economic Zone (SCZONE) has established API as a priority in attracting investment with tax cuts.
To prevent future supply chain issues, Egypt has ticked the following boxes: deals with global companies, tax incentives to attract investors and develop local companies. What remains to be ascertained: will API makers be seduced?
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