Trade and Industry Minister Dr Rob Davies has signed a memorandum of agreement with Indian pharmaceutical company Cipla Biotec on the commercial terms of a R1.3-billion investment to establish Cipla Biotec’s new biosimilars manufacturing facility, at the Dube TradePort special economic zone (SEZ), in KwaZulu-Natal.
The agreement was concluded on the margins of the Brazil, Russia, India, China and South Africa (Brics) summit, held in Goa, India, last week.
The facility will be South Africa’s first biotech manufacturing facility for the production of biosimilars and will produce a range of affordable treatments for cancer and other autoimmune diseases for the African and global market.
“The Cipla investment is a top ten priority project of the inter-Ministerial Committee on Investment chaired by President Jacob Zuma and is strategic for a number of reasons,” Davies said.
He noted that it resonates well with South Africa’s industrial policy and puts the country at the cutting edge of innovation, moving up the value chain to advanced manufacturing and a knowledge-based economy.
He continued that it had socioeconomic benefits and strengthened South Africa’s partnership with India and other Brics countries, with the goal of providing affordable healthcare.
“Cipla has a plant in Goa and South Africa will be the second location that will serve the African continent and global markets,” he said.
KwaZulu-Natal Economic Development, Tourism and Environmental Affairs MEC Sihle Zikalala welcomed the deal saying the project would assist in making medication more affordable.
“We welcome this investment with open arms, as the technological level of this investment has the potential to impact on a number of economic and social facets of our society, well beyond the sizable investment amount of R1.3-billion in the new manufacturing facility and the 180 permanent jobs that it will create,” he said.
Cipla Biotech director Steve Lehrer also said the project would reduce the cost of medicine in South Africa.
“We believe that groundbreaking medicine is meaningless if barriers like cost and availability keep it from the patients who need it most. To be a truly world class treatment, it must be within reach of the whole world,” he stated.
Dube TradePort Corporation chairperson Dr Bridgette Gasa described Cipla’s investment as further affirmation that the SEZ had created an investment destination that is conducive to doing business in South Africa.
“The DTI and Dube TradePort SEZ, together with the province of KwaZulu-Natal, have provided reliable infrastructure, services and tax incentives to attract both local and foreign direct investments,” she said.
Construction of the new facility is scheduled to start early next year, while full operations are expected in the third quarter of 2018.