Drugmakers in Africa's largest pharmaceutical market may be asked to pay a "backlog fee" to help clear a pipeline of medicines waiting years for approval, according to a proposal being considered by South Africa's new industry regulator.
Delays for hundreds of medicines have kept the latest treatments off South African shelves and hampered the fight against cancer, heart and other diseases in a country which also has more people receiving anti-retroviral drugs (ARVs) than anywhere else in the world.
Besides improving access to life-saving medication, analysts say the South African Health Products Regulatory Authority's (SAHPRA) proposal could help boost the revenue streams for companies competing in the $3.8-billion-a-year market.
"It's the first time South Africa offers this and we would support a backlog fee, provided it is performance driven," said Stavros Nicolaou, senior executive for strategic trade at Aspen Pharmacare.
SAHPRA wants to cut the backlog and allow the regulatory assessment of all products in an "achievable but ambitious" timeframe, the authority told Reuters.
"As part of this process, SAHPRA is also exploring other potential sources of revenue, including a backlog fee to ... speed up the registration of products in the current backlog," said Helen Rees, chairperson of SAHPRA's board.
Talks with industry on cost implications, procedures and schedule for implementation are ongoing, she said.
Adcock Ingram said it was keen to discuss SAHPRA's proposal to expedite reviews of its treatments.
"Adcock Ingram currently has more than 250 dossiers awaiting approval," spokesperson Kavitha Kalicharan said.
The company has waited up to seven years for a regulatory decision on some of its products, she said, and speeding up the process could bolster its prescription division.
South Africa's pharmaceutical market is forecast to grow at a compound annual rate of 7.3% over the next decade, reaching R87.5-billion ($7.3-billion) by 2027 from R45.4-billion rand now, according to BMI Research.
FOCUS ON CHEAPER GENERICS
Replacing an apartheid-era Medicines Control Council lacking enough funds and expert staff, SAHPRA will for the first time refer to prior reviews from other regulators when registering drugs and medical devices.
It will also prioritise treatments that meet public health needs and potentially reduce prices by boosting competition and licensing cheaper generics.
"SAHPRA will prioritise the review of generic medicines to encourage market competition and improve affordability, but once market saturation has occurred, there will not be further prioritisation," Rees told Reuters.
Africa’s most industrialised economy has a history of pushing to cut the prices of vital medicines, including winning concessions from big pharmaceutical firms to reduce the cost of ARVs used to control the HIV virus.
Industry body IPASA, which represents just under half of South Africa's pharmaceutical private sector, said that while generic medicines were good for bringing prices down, it wanted to avoid perceptions of bias.
"The government should not myopically just want to push generics at the expense of branded medicines," said Dr Konji Sebati, chief executive of the Innovative Pharmaceutical Association South Africa (IPASA).