opportunities & challenges in west africa's (ghana & nigeria) healthcare and...

Opportunities and Challenges in West Africa’s Healthcare and Pharmaceutical Sector

Aiswariya Chidambaram Senior Research Analyst - Life Sciences

CPhI Worldwide, Paris8-10-2014

2

Focus Points

Focus Points

Ghana & Nigeria – Macroeconomic Overview

Pharmaceutical Industry in Ghana & Nigeria Overview

Ghana & Nigeria Pharmaceutical Market Trends and Forecasts

Pharmaceutical Market Segmentation by Therapeutic Area

Therapeutic Area Growth Analysis

Key Drivers & Restraints

Pharmaceutical Procurement Process

Competitive Analysis by Company Type

Ghanaian Pharmaceutical Industry – Detailed Overview

Key Mergers, Acquisitions & Partnerships

Future Directions for Pharmaceutical Companies in Ghana & Nigeria

Nigerian Pharmaceutical Industry – Detailed Overview

3

Pharmaceutical Industry in Ghana & Nigeria Overview

Market Stage

Growth

Market Revenue

$1.63 B

(2013) (2013)

Market Size for Last Year of Study Period

$3.12 B

(2018)

Base Year Market Growth Rate

14.0%

Compound Annual Growth Rate

13.9%

(CAGR, 2013–2018)

Customer Price Sensitivity

9

(scale:1 [low] to 10 [High])

Degree of Technical Change

6

(scale:1 [low] to 10 [High])

Total Pharmaceutical Industry: Market Engineering Measurements, Ghana & Nigeria, 2013

Market Overview

Note: All figures are rounded. The base year is 2013. Source: Frost & SullivanStable IncreasingDecreasing

(2013)

Prescription Pharmaceutical Segment Revenue

65.9%

(2013)

OTC Pharmaceutical Segment Revenue

34.1%

(2013)

Number of Registered Market Participants

185 (approximately)

(active market competitors in 2013)

4

Ghana & Nigeria Pharmaceutical Market Trends and Forecasts

Key Trends

Robust industry growth expected to near 14% p.a. in the next 5 years, underpinned by:

Continuous burden of infectious diseases including malaria, TB and AIDS among others drives demand for anti-infectives

Increased incidence of NCDs including diabetes, hypertension and cancer drives demand for chronic prescription drugs.

OTC segment expected to witness growth mainly for anti-infectives, analgesics and vitamins

Rapid increase in uptake of generics anticipated owing to increased NHIS coverage.

100% NHIS coverage in Ghana expected to boost prescription drugs

Pharmaceutical Industry in Ghana & Nigeria: Revenue Forecast

Key Segments

75%

25%44.3%

34.1%

21.6%

Sales Breakdown by Exclusivity Status, 2013

Revenue Breakdown by Geographic Region, 2013

2.4%

7

Governments to encourage local production of essential medicines to improve capacity utilization and reduce imports

2010 2011 2012 2013 2014 2015 2016 2017 20180.000.501.001.502.002.503.003.50

0.0

4.0

8.0

12.0

16.0

20.0

Rev

enue

($ B

illio

n)

Gro

wth

Rat

e (%

)

CAGR (2013 – 2018) = 13.9%

Branded

Nigeria

Ghana

OTC

Generic

CAGR (2013 – 2018) = 13.9%

5

Per Cent Revenue Forecast by Region

Ghana is expected to witness higher growth than Nigeria because of increased NHIS coverage and well-defined regulatory guidelines.

2010 2011 2012 2013 2014 2015 2016 2017 20180.0

25.0

50.0

75.0

100.0

Total Pharmaceutical Industry: Per Cent Revenue Forecast by Region, Ghana & Nigeria, 2010–2018

Year

Rev

enue

(%)

Note: All figures are rounded. The base year is 2013. Source: Frost & Sullivan

6

Pharmaceutical Market Segmentation by Therapeutic Area

Anti-infectives25.8%

Cardiovascular11.9%

Diabetes6.2%

Respiratory5.6%CNS

4.4%

Oncology3.5%

Others7.9%

OTC34.7%

Total Pharmaceutical Industry: Per Cent Sales Breakdown by Therapeutic Segment, Ghana & Nigeria, 2013

Although anti-infectives constitute the largest segment of the prescriptive pharmaceutical market, a marked shift in the burden of illness towards lifestyle diseases is expected.

Note: Others include dermatology, gastrointestinal, and rheumatology. Note: All figures are rounded. The base year is 2013. Source: Frost & Sullivan

7

Therapeutic Area Growth Analysis

Total Pharmaceutical Industry: Therapeutic Segment Growth Analysis, Ghana & Nigeria, 2014–2018

Anti-infectives

2%

4%

6%

8%

10%

12%

14%

Cardiovascular Diabetes Respiratory CNS

Declining

Fast Growing

Growing

Source: Frost & Sullivan

OncologyNote: Bubble size represents market value

Continuous burden of anti-infectives is expected to contribute to significantly high growth of this segment throughout the forecast period.

The relatively lesser incidence of respiratory diseases coupled with lack of technological expertise for the production of certain drug types is expected to restrict the growth of this segment.

This is the fastest growing segment. Early diagnosis, coupled with increasing awareness, is expected to fuel the growth of this segment.

20%

Fast Growing

CA

GR

Fast Growing

Fast Growing

Increasing awareness of mental conditions and efforts to protect mental health of people are expected to drive growth in the long-term.

The increasing rate of urbanisation and adoption of western life style are expected to result in an increasing incidence of NCDs, including cardiovascular disease and diabetes.

8

Drivers

Continuous burden of infectious diseases

Increasing incidence of NCDs

Increased healthcare spending

Weak regulatory

policies

Weak distribution

systems

Poor diagnosis

and patient awareness

Restraints

Pharmaceutical Industry in Ghana & Nigeria – Key Drivers and Restraints

• Largest reservoir of malaria, TB and AIDS

• Recent outbreak of Ebola virus

• Increased public health coverage (90%)

• Expanded program on immunization (EPI)

• Increasing adoption of western lifestyle

• NCDs to constitute 21% by 2030

• Steep rise in chronic drugs to essential medicines ratio

• Pharmaceutical spending in Africa to reach $35 billion by 2018

• Implementation of NHIS to improve access and availability of drugs

• FDI in Africa expected to double by 2016

• Inadequate number of pharmacies and private clinics

• Counterfeit drugs and illegitimate drug trading

• Drug registration process time consuming and open to corruption

• Absence of structured pricing system poses challenge to public sector

• Private sector challenged by high out-of –pocket spending

• Poor knowledge of diagnostic procedures

• Patients skeptical about use of modern medicines

• Lack of trained doctors and nurses


9

Pharmaceutical Procurement Process

Local Manufacturers Generic Companies

Distributors

Branded Companies

Manufacturer Representatives Direct Sales

Distributors Teaching hospitals, private hospitals,

clinics, pharmacies, and chemical sellers

Total Pharmaceutical Industry: Procurement Process, Ghana & Nigeria, 2013


Key Takeaway: Engaging in strategic partnerships with local distributors is crucial for effective product distribution in Ghana and Nigeria.

End User

10

• Efforts have been made to ensure quality production

• The WHO and UNITAID have offered technical assistance and capacity building to Nigerian drug makers in achieving GMP

standards and WHO pre-qualification

Branded companies predominantly target the

private sector, especially for in-demand therapies

Increasing incidence of NCDs to fuel demand for

specialty pharmaceuticals driving growth of MNCs

Importers include Indian and Chinese generic

pharmaceutical companies.

Indian generic companies, which sell drugs

mostly through NGOs and government tenders,

fare much better than their Chinese counterparts.

Local manufacturers sell own brands besides

distributing brands of MNCs and importers

High cost of local APIs poses challenge to local

manufacturers

Only a handful of local companies have gained

WHO pre-qualification status

Competitive Analysis by Company Type

Importers36.7%

Branded companies34.5%

Local manufac-turers28.8%

Per Cent Sales Breakdown by Tiers of Competition, Ghana & Nigeria, 2013


11

Key Success Factors

Competitive Pricing

Good product quality

Well-established distribution

network

Marketing Strategies

Brand Recognition/

Loyalty


Total Pharmaceutical Industry: Key Competitive Factors, Ghana and Nigeria

Key Competitive Factors for Pharmaceutical Companies

12

Ghanaian Pharmaceutical Industry Overview

OTC28.8%

Generic71.1%

Branded28.9%

Pharmaceutical Industry: Per Cent Revenue by Product Segment, Ghana, 2013

Pharmaceutical Industry: Per Cent Revenue by Imported and Locally Produced Pharmaceuticals,

Ghana, 2013

Locally manufactured34.0%

Imported66.0%

The OTC product segment is considerable, attributing to inaccessibility issues with prescription pharmaceuticals in certain regions, increased focus of the local participants on the OTC sector, and heavy advertising of OTC drugs.

Ghana has approximately 55 registered pharmaceutical manufacturers producing finished dose formulations.

Few companies equipped with the capabilities to produce APIs. La Gray Chemical Company is one such example.

Well-developed NHIS and major donor funding for the provision of essential drugs

10-15% of locally produced drugs exported to other West African countries.

Unregistered products account for 4% of the market; exact share of counterfeit drugs unknown

Acute respiratory infections, malnutrition, anemia, diarrhea, and measles account for 50% of all childhood hospitalisation and 30% of childhood deaths.


13

Ghana – Market Analysis by Product Segment

50.6%

20.6%

28.8%

Generic Branded OTC

• Local manufacturers primarily focus on OTC.

• Key products include combination analgesics, tonics, vitamins, cold and flu preparations

• High cost of imports, APIs and intermediates to drive growth of OTC segment

• Increased NHIS coverage could result in slightly lesser growth

• Increasing incidence of NCDs drive growth in this segment

• Significant proportion of Ghanaian population are brand loyal

• Growth of niche therapy areas such as oncology and CNS expected to increase uptake of branded drugs

• Increasing patient awareness to contribute to growth

• Traditionally largest segment comprising half the market

• Key suppliers include importers from India and China

• Local manufacturers produce drugs for PEDs

• Cent percent NHIS coverage – major growth driver

• Generic companies likely to win tenders in public sector, particularly in diabetes and cardiovascular segments

• Expected to witness highest growth, representing almost 60% by 2018


14

Ghanaian Pharmaceutical Industry—Procurement and Supply Management

Tertiary level

(Central authorities)

Secondary level(District and regional)

Primary level(Community and rural areas)

Public Sector Pharmaceutical Procurement The Ministry of Health (MOH) Procurement Department

is responsible for the overall steering and management of the public sector drug procurement.

The Ghanaian health service (GHS), a service delivery agency under the MOH, is responsible for the allocation of resources and liaison with the private sector.

Public sector procurement comprises 3 levels.o Tertiary-level services are provided by central authorities that

include the major public teaching hospitals (Korle Bu, Komfo Anokye and Tamale) via tendering

o secondary-level services are offered by district and regional institutions.

o Primary-level services are provided by community and sub-district/rural institutions

Pharmaceutical Industry: Public Sector Drug Procurement, Ghana, 2013


15

Ghanaian Pharmaceutical Industry—Procurement and Supply Management (continued)

• Drugs that address local PEDs and financed through TGF are procured via ICB.

• WHO pre-qualification and registration with FDB is required for a product to qualify for ICB.

• Drug needs assessment is done by the following agencies:o ARVs – Ghana Office of

UNAIDS and WHOo Anti-malarials – Ghana

National Malarial Control Program

o TB drugs – Ghana National TB Program and WHO

o NTD drugs – Ghana MOH and WHO

International Competitive Bidding (ICB)

Pharmaceutical Industry: Public Sector Procurement Process, Ghana, 2013

• Conducted for essential drugs not provided through TGF

• Product qualifications include FDB product registration and GMP registration.

• Nearly 1% of ARVs and anti-malarial drugs are procured through NCB.

National Competitive Bidding (NCB)

• Large number of vaccines and medical devices such as disposables and condoms are donated through UNICEF and USAID as well as ITNs through NGOs.

• Additionally, the research industry donates a significant chunk of medicines, although the exact amount is unknown.

Donations

• The MoH Central Medical Stores maintains large supplies of drugs targeting PEDs.

• Whenever there is an acute supply shortage or lengthy delay in ICB- and NCB-based procurements, MoH fulfils drug procurement orders through shopping.

• A huge amount of essential drugs are procured through shopping.

Shopping


16

Ghanaian Pharmaceutical Industry - Distribution

Distribution

• Drugs procured publically via ICB/NCB are

distributed by the MoH’s Central Medical

Stores.

• Transported to the district medical stores

managed by district health authorities

• Dispensed from public health centers

• Anti-retrovirals, medicines for HIV/AIDS, TB,

and NTDs are distributed by the public sector

and confirmed by the Ghana Standard

Treatment Guidelines.

• Few NTD drugs produced locally; vast majority

imported via ICB/ NCB and distributed through

the public sector

• Highly chaotic with thousands of

intermediaries involved

• Local companies forced to create own

distribution agencies to ensure product

supply at fair prices

• Anti-malarials, particularly Artemesinin-

based combination therapy (ACTs), are

distributed at subsidised rates

• Malaria largely treated outside the public

health system ; ACT anti-malarials

dispensed as OTC products.

• ITNs imported from donors represent an

integral part of malaria treatment

Public Sector Private Sector


17

Ghanaian Pharmaceutical Industry—Demand Analysis

• Local manufacturers producing drugs for malaria, TB and HIV export to other parts of West Africa.

• Large-scale manufacturers compelled to produce under capacity as the local pharmaceutical market is primarily focused on the OTC non-essential products.

• Local pharmaceutical industry strives to address PEDs and control population morbidity.• Supply of medicines for PEDs through TGF funding and ICB procedure is as follows:

o ARVs heavily dependent on Indian suppliers o Anti-malarial ACTs largely supplied from India and Chinao TB drugs predominantly supplied through IDAo Drugs for NTDs are principally imported.

• Besides traditional oral and topical formulations, Ghana also has local capacity for the production of parenteral fluids (Intravenous Infusions Limited and San Bao Company Limited).

• Vaccines and injectables imported mostly through ICB/ NCB as well as drug donations

• Increasing investment by MNCs and Indian companies in local pharmaceutical production

Local Pharmaceutical Market: Industry Capacity Utilisation, Ghana, 2013

48.0% 100%0%


(Capacity Utilization Potential)

18

Ghanaian Pharmaceutical Industry – Competitive Landscape

Rank Branded Companies Generic Companies Local Manufacturers

1

2

3

4

5

Other Noticeable

ParticipantsNovartis, Jansen-Cilag Glenmark, Serum Institute of

India, Mepha

Danadams Pharmaceuticals Ltd., La Gray Chemical Company

Pharmaceutical Industry: Key Market Participants, Ghana, 2013


19

Ghanaian Pharmaceutical Industry—SWOT Analysis


• Under-utilisation of local pharmaceutical manufacturing capacity often by 50%

• Limited incentives for PED drug production; hence heavy reliance on OTC drugs

• High cost of locally-manufactured products• Unable to conduct bio-equivalence studies

required for WHO pre-qualification• Large variation in local ex-manufacturing prices

for comparative products• Lack of consensus regarding TRIPS

implementation and compulsory licensing.

• Imported raw material expense and supply shortages

• VAT on imported manufacturing materials• Influx of low-cost Asian generics• Parallel pharmaceutical trade• Continued proliferation of counterfeit

pharmaceuticals• Price sensitivity of the total pharmaceutical industry.• Unmet human resource development needs• Lack of focus on pharmaceutical R&D issues

Stre

ngth

sO

pportunitiesW

eakn

esse

s Threats

• Well-functioning pharmaceutical regulation systems in place

• One of the strongest pharmaceutical industries in the Economic Community of West African States (ECOWAS)

• High degree of economic and political stability in Africa

• Cent per cent public health coverage • Established local manufacturing industry• Existence of public budget for products that

address priority endemic diseases

• WHO pre-qualification enables better access of local producers to international markets

• Utilisation of the ‘marginal preference scheme’ applied to tenders

• Access to external funding sources and technical assistance

• Creation of local API, excipient, and packaging material production

• Access to the President's Special Initiative Programme

• Effective lobbying of PMAG and WAPMA on important local industry issues

20

Nigerian Pharmaceutical Industry Overview

Pharmaceutical Industry: Per Cent Revenue by Product Segment, Nigeria, 2013

Pharmaceutical Industry: Per Cent Revenue by Imported and Locally Produced Pharmaceuticals,

Nigeria, 2013

Locally manufactured30.0%

Imported70.0%

The OTC product segment is quite large as a significant proportion of population yet to be covered under NHIS operational since 2005.

Nigeria has over 10,000 unregistered patent and proprietary drug stores selling OTC products only

Vibrant pharmaceutical industry employing about 500,000 people in manufacturing and distribution

According to the Pharmacists Council of Nigeria, there are 128 registered drug manufacturers, 724 drug distributors, 1,543 retail pharmacies, and 292 drug importers in Nigeria.

Only 50% of population covered under NHIS Nigerian pharmaceutical industry is quite

susceptible to parallel trading. It is estimated that nearly 17% of essential

generic medicines and as high as 30% of anti-malarials are routinely faked in Nigeria.

ARVs, ACTs, and anti-TB drugs considered life-saving drugs, the government strives to encourage local production of these medicines Note: All figures are rounded. The base year is 2013. Source: Frost & Sullivan

OTC39.4%

Generic62.9%

Branded37.1%

21

Nigeria – Market Analysis by Product Segment

38.1%

22.5%

39.4%

Generics Branded OTC

• OTC segment quite large as people practice self-medication

• Anti-malarial ACTs, analgesics, and multivitamins constitute a large share

• Increasing demand for vitamins and health supplements drive growth

• Over 10,000 unregistered stores selling OTC drugs

• High out-of-pocket payment by patients is likely to restrict use of premium branded drugs

• Branded drugs more commonly used in private sector by brand-loyal customers

• Increasing incidence of life-style diseases and absence of cheaper generic equivalents to drive growth of this segment

• Smaller as compared to Ghana as consumers are price-sensitive

• 70% of generics imported while 30% produced locally

• Anti-infectives, cardiovascular and diabetes are key therapeutic segments

• Expected to witness high growth – CAGR 14.6%


22

Nigerian Pharmaceutical Industry—Procurement and Supply Management

Tertiary healthcare

under Federal Government

Secondary healthcare controlled by the

State MOH

Primary healthcare controlled by theLocal Government Areas

Pharmaceutical Industry: Public Sector Drug Procurement, Nigeria, 2013

Public Sector Pharmaceutical Procurement The federal government is responsible for over all policy

formulation and technical guidance to all healthcare providers.

Public sector procurement comprises 3 levelso The tertiary healthcare centres (University teaching

hospitals) and federal medical centres located in 36 states procure drugs and supplies from the federal government.

o The secondary level healthcare comprised of state hospitals is supplied by the State MoH, which also offers technical support to the local government areas (LGAs).

o The primary level healthcare services are taken care of by the LGAs.

• The private sector, NGOs, and traditional health practitioners provide service across the healthcare delivery system.


23

Ghanaian Pharmaceutical Industry—Procurement and Supply Management (continued)

• BPP established in 2007 by the Public

Procurement Act (PPA) is responsible for

the overall steering and management

• Aims to ensure accountability, integrity,

and transparency in the procurement

process, establishment of pricing

standards and benchmarks

• Frames policies and guidelines for the

approval of the National Council on

Public Procurement (NCPP)

• Right to debar any supplier, service

provider or, contractor in case of

violation of the Act.

The Bureau of Public Procurement

(BPP)

Pharmaceutical Industry: Public Sector Procurement Process, Nigeria, 2013


• Provision of PPA that grants a margin of

preference while evaluating tenders,

comparing bids from domestic and

foreign companies.

• Margins of preference applies only to

tenders procured under ICB.

• It is required that the bidding

documents clearly state the preference

and furnish information required to

establish the eligibility of a bid for such

preference.

Domestic Preference Policy

24

Nigerian Pharmaceutical Industry - Distribution

Distribution

• Traditionally 3 different warehouses – The

Central Central Medical Stores, the Federal

Medical Stores (FMS), and the State Medical

Stores

• Currently, all integrated into one – the Central

Medical Stores with one branch in Oshodi and

another in Abhuja.

• A mega distribution consensus model was

framed to improve distribution

• Drugs collected from the FMS in Oshodi are

distributed directly to health institutions across

the country

• Drug distribution to pharmacists is prevented,

thereby promoting rational drug use.

• Local manufacturers and importers have

their own distribution channels to supply

medicines

• Drugs are traded in unregistered and

unlicensed premises, and sometimes by

non-pharmacists

• A predominant hub of counterfeit drugs -

17% of essential generic drugs and 30%

of anti-malarials are routinely faked

• NAFDAC strives to tackle this problem

through radio frequency identification

(RFID) technology for logistics and

tagging to detect fake medicines

Public Sector Private Sector


25

Nigerian Pharmaceutical Industry—Distribution (continued)

FACTORY/EXPORT

Mega Distribution

Wholesalers Wholesalers Wholesalers

Retailers Clinics

Hospitals

Retailers Clinics

Hospitals

Retailers Clinics

Hospitals

Regional Hub –SW

Regional Hub –SE

Regional Hub –North

Regional Hubs

Pharmaceutical Industry: Public Sector Drug Procurement—Mega Distribution Company Consensus Model, Nigeria, 2013

Source: PMG-MAN; Frost & Sullivan

26

Nigerian Pharmaceutical Industry—Demand Analysis

• Local industry meets 30% of demand while 70% is imported from India and China

• Local manufacturers produce tablets, capsules, ointments, liquid preparations, creams, lotions, and ophthalmic preparations

• Fluctuations in capacity demand are attributed to low purchasing power within the population and the irregular government purchase of drugs and delayed payments

• Drugs locally produced in Nigeria represent as much as 60% of the pharmaceutical production in the ECOWAS region.

• Judicious efforts to increase utilization rate of available capacity include:o Upgrading of facilities of local drug manufacturers to obtain the WHO pre-qualification status o In 2010, 6 Nigerian companies gained WHO pre-qualification for supply of ARVs, anti-malarials and anti-TB drugso Ban imposed by Nigerian FMoH on the import of certain essential medicines to attain self-sufficiency and reduce

parallel tradeo Revised ECOWAS tariff structure for import of drugs: essential medicines, industry machinery and equipment - 0%

tariff; raw materials and other capital goods – 5% tariff; intermediates – 10%; finished goods – 20% tariff; finished products with adequate local capacity – 50% tariff

Local Pharmaceutical Market: Industry Capacity Utilisation, Nigeria, 2013

42.0% 100%0%

(Capacity Utilization Potential)


27

Nigerian Pharmaceutical Industry – Competitive Landscape

Rank Branded Companies Generic Companies Local Manufacturers

1

2

3

4

5

Other Noticeable

ParticipantsAstraZeneca, Jansen-Cilag, Eli Lilly

Nigeria German Chemicals Plc, Greenlife Pharmaceuticals Ltd.

Juhel Nigeria Ltd., Swipha, Neimeth International Pharmaceuticals Plc.

Pharmaceutical Industry: Key Market Participants, Nigeria, 2013


28

• Current capacity utilisation rate in Nigeria is only 45%.

• Access to affordable funding for local manufacturers is hampered by high bank interest rates.

• High cost of locally manufactured products than those imported

• Unable to conduct bio-equivalence studies required for WHO pre-qualification

• Large variation in local ex-manufacturing prices for comparative products

• Weak purchasing power threatens scope for marketing drugs.

• VAT on imported manufacturing materials• Influx of low-cost Asian generics• Parallel pharmaceutical trade• Continued proliferation of counterfeit

pharmaceuticals• Price sensitivity of the total pharmaceutical industry• Failure to address loopholes in the distribution

system• Lack of focus on pharmaceutical R&D issues

Stre

ngth

sO

pportunitiesW

eakn

esse

s Threats

• More than 60% of pharmaceutical production in ECOWAS countries is domiciled in Nigeria.

• Attainment of WHO cGMP and pre-qualification status by certain companies enables participation in international tenders.

• High degree of economic and political stability• Established local manufacturing industry –

technical skills, trained manpower, and basic manufacturing infrastructure already exists.

• Large market size, strong demand and need for better management of anti-infectives (malaria, AIDS, and TB)

• Positive economic growth and macroeconomic stability in recent years

• Judicious efforts taken by NAFDAC to reduce counterfeit trade

• Government ban of imports of certain essential medicines for which there is adequate capacity and technical skills

• Establishment of NHIS scheme to provide universal health coverage by 2015

Nigerian Pharmaceutical Industry—SWOT Analysis


29

Key Mergers, Acquisitions & Partnerships

Value: UndisclosedYear of Deal: February 2014Key Reason:• Imperial Health Sciences, the

Life Sciences division of Imperial Logistics, a leading distribution company in South Africa, bought 53% stake in WWCV.

• By this deal, Imperial Logistics is expected to leverage the well-established supply chain network of WWCV in Nigeria, thereby pioneering into the healthcare space.

Value: $86.0 millionYear of Deal: July 2012Key Reason:• Bought the manufacturing

facility and sales and distribution infrastructure of Cosme Farma

• Adcock Ingram strives to expand its presence in the Indian pharmaceutical market by leveraging Cosme Farma’s strong sales forces and nearly 60 well-established brands in dermatology gynecology, among others.

Value: UndisclosedYear of Deal: May 2012 Key Reason:• Sanofi Aventis acquired

Medreich’s portfolio of branded generics in Sub-Saharan Africa

• Med Reich being the leading generic pharmaceutical company, Sanofi has managed to significantly increase its market shares in the generic pharmaceuticals segment by this acquisition.

Adcock Ingram – Cosme Farma

Imperial Logistics – Worldwide

Commercial Ventures Limited (WWCV)

Sanofi aventis – Medreich

Source : Frost & Sullivan .

Pharmaceutical Industry: Key Mergers, Acquisitions & Partnerships, Ghana & Nigeria, 2012 - 2014

30

Future Directions for Pharmaceutical Companies in Ghana & Nigeria

2 Foreign traders in Africa are expected to bolster their distribution channels by engaging in strategic partnerships with local trustworthy stakeholders.

3Given the immense growth potential and business opportunities, it is expected that companies would invest significantly in their marketing capabilities, patient awareness programmes, and treatment support services to enhance brand loyalty.

1Branded companies are expected to adopt a differential pricing strategy specific to patient segments and geographies in Africa to make treatment affordable to a large group of patients, thereby significantly expanding their customer base.


31


Foreign Companies to Bolster Distribution Channels

• Addressing loopholes in supply

chain and distribution channels

• Technical Training of distributors and

retailers

• Pharmacists influence choice of

customers and brand image

Branded Companies to adopt Differential Pricing Strategy

• Revisiting cost of commodity generics

• Close coordination with NGOs to

penetrate rural areas

Game-changing Strategies for the success of market participants •Patient support programs for

technically challenging formulations

• Investing in R&D and engaging local patient groups

• Bar codes and holograms to track

counterfeits

Enhance Patient Awareness and Treatment Support Services

Future Directions for Pharmaceutical Companies in Ghana & Nigeria (continued)

• Engage in strategic

partnerships with trustworthy local

stakeholders

• Training of physicians and

nurses

• Detailing by medical

representatives

• Continual medical education (CME)

programs

•Advisory/Advocacy Boards

• Corporate Social Responsibility

(CSR)

Questions

33

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