South Africa to spend USD 688.2m on HIV drugs

The South African government's department of trade and industry (DTI) has announced it will spend about ZAR 5bn (USD 688.2m) on anti-retrovirals (ARVs) in the next three years to augment domestic production of the drugs.

According to the Medical Research Council, 5.4m people are living with HIV/Aids in South Africa, which is the second most infected population after India.

The DTI added that increased local production of ARVs would make it economically viable for pharmaceutical companies to manufacture them locally and reduce associated costs. At the moment, active pharmaceutical ingredients (APIs) for making ARVs are imported, pushing up running costs for manufacturing plants in the region.

Andrew Kudlinski, director for geographic projects at the DTI, said: "Manufacturing ARVs involves complex technology and is costly. A company must make large volumes to make it economically justifiable and if you have a three-year contract, the manufacturer can justify the investment.î

"South Africa has the capacity to manufacture most ARVs locally but 100 percent of the active pharmaceuticals ingredients are imported and we can use state procurement to encourage the domestic manufacturing of APIs in the future," added Kudlinski.

Nimrod Zalk, the DTI's chief director of industrial policy, explained that the government was concerned about the import ratio in the drugs sector, which was worth ZAR 17.7 billion in 2006.