Abudu, De ick; Ayele, Yohannes
Resea ch Repo
The A CFTA and he p ocu emen o pha maceu icals and
accines
ODI Repo
P o ided in Coope a ion wi h:
ODI Global, London
Sugges ed Ci a ion: Abudu, De ick; Ayele, Yohannes (2024) : The A CFTA and he p ocu emen o
pha maceu icals and accines, ODI Repo , ODI, London,
h ps://odi.o g/en/publica ions/ he-a c a-and- he-p ocu emen -o -pha maceu icals-and- accines/
This Ve sion is a ailable a :
h ps://hdl.handle.ne /10419/314362
S anda d-Nu zungsbedingungen:
Die Dokumen e au EconS o dü en zu eigenen wissenscha lichen
Zwecken und zum P i a geb auch gespeiche und kopie we den.
Sie dü en die Dokumen e nich ü ö en liche ode komme zielle
Zwecke e iel äl igen, ö en lich auss ellen, ö en lich zugänglich
machen, e eiben ode ande wei ig nu zen.
So e n die Ve asse die Dokumen e un e Open-Con en -Lizenzen
(insbesonde e CC-Lizenzen) zu Ve ügung ges ell haben soll en,
gel en abweichend on diesen Nu zungsbedingungen die in de do
genann en Lizenz gewäh en Nu zungs ech e.
Te ms o use:
Documen s in EconS o may be sa ed and copied o you pe sonal
and schola ly pu poses.
You a e no o copy documen s o public o comme cial pu poses, o
exhibi he documen s publicly, o make hem publicly a ailable on he
in e ne , o o dis ibu e o o he wise use he documen s in public.
I he documen s ha e been made a ailable unde an Open Con en
Licence (especially C ea i e Commons Licences), you may exe cise
u he usage igh s as speci ied in he indica ed licence.
h ps://c ea i ecommons.o g/licenses/by-nc-nd/4.0/
The A CFTA and he
p ocu emen o
pha maceu icals and
accines
De ick Abudu and Yohannes Ayele
Oc obe 2024
Suppo ing In es men and T ade in A ica (SITA)
Repo
ODI Repo
2
Reade s a e encou aged o ep oduce ma e ial o hei own
publica ions, as long as hey a e no being sold comme cially. ODI
eques s due acknowledgemen and a copy o he publica ion.
Fo online use, we ask eade s o link o he o iginal esou ce on he
ODI websi e. The iews p esen ed in his pape a e hose o he
au ho (s) and do no necessa ily ep esen he iews o ODI o ou
pa ne s.
This wo k is licensed unde CC BY-NC-ND 4.0.
How o ci e: Abudu, D. and Ayele, Y. (2024) ‘The A CFTA and he
p ocu emen o pha maceu icals and accines. ODI Repo . London:
ODI (h ps://odi.o g/en/publica ions/ he-a c a-and- he-p ocu emen -
o -pha maceu icals-and- accines)
ODI Repo
3
Acknowledgemen s
This epo has been p epa ed unde he Suppo ing In es men and
T ade in A ica (SITA) p og amme, an ini ia i e unded by UK
In e na ional De elopmen om he UK go e nmen o suppo he
nego ia ions and implemen a ion o he A ican Con inen al F ee
T ade A ea (A CFTA). All iews p o ided a e hose o he au ho s
and no he esponsibili y o ODI, he A CFTA Sec e a ia o he UK
Go e nmen .
The au ho s would like o hank M Themba Khumalo and Ki i Na sai
o hei commen s.
Abou he au ho s
De ick Abudu is a Senio Resea ch O ice a ODI.
Yohannes Ayele is a Senio Resea ch O ice a ODI.
ODI Repo
4
Con en s
Acknowledgemen s ...................................................................................... 3
Ac onyms ..................................................................................................... 5
Execu i e summa y ...................................................................................... 6
1 In oduc ion ...................................................................................... 9
2 Analysis o pha maceu ical and accine ini ia i es on con inen al
p ocu emen ................................................................................... 11
Pooled pha maceu ical ini ia i es a con inen al le el .................... 11
Modes o pooled p ocu emen ....................................................... 13
Regional bloc pooled p ocu emen expe iences ............................ 14
2.3.1 Sou he n A ican De elopmen Communi y ................................... 14
2.3.2 Eas A ican Communi y ................................................................. 14
2.3.3 Gul Coope a ion Council G oup Pu chasing P og am .................. 15
2.3.4 Pan Ame ican Heal h O ganiza ion ................................................ 15
2.3.5 O ganisa ion o Eas e n Ca ibbean S a es ..................................... 15
3 Assessmen o con inen al and A CFTA policies and p o ocols ..... 16
T ade wi hin A ica and wi h he es o he wo ld in c i ical p oduc s.16
3.1.1 In a-A ica pha ma and accine ade ........................................... 18
3.1.2 Ta i s ............................................................................................. 20
Rules o o igin on pha maceu icals and accines .......................... 20
3.2.1 Rules o o igin o pha maceu icals unde he A CFTA .................. 21
3.2.2 Possible ac ions o suppo con inen al-le el p ocu emen ............ 22
P o ocol p o isions in ela ion o ules and p ocedu es in he A CFTA
....................................................................................................... 23
3.3.1 A CFTA p o ocols o ade in goods and se ices ......................... 23
3.3.2 P o ocol on ules and p ocedu es on he se lemen o dispu es ... 24
3.3.3 P o ocols on in es men , in ellec ual p ope y igh s and compe i ion
policy .............................................................................................. 24
Pha maceu icals s anda ds, hei ha monisa ion and/o mu ual
ecogni ion a angemen s .............................................................. 25
3.4.1 P ocu emen o pha maceu icals ................................................... 26
3.4.2 Ha monisa ion egula ions ............................................................. 27
4 C osscu ing issues and syne gy assessmen ............................... 29
Po e y impac ............................................................................... 29
Clima e and en i onmen ............................................................... 30
Gende ........................................................................................... 31
5 Policy ecommenda ions ................................................................ 33
Re e ences ................................................................................................. 37
Appendix 1 HS classi ica ions o selec ed accine- ela ed inpu s ........ 41
ODI Repo
5
Ac onyms
A CFTA A ican Con inen al F ee T ade A ea
A eximbank A ican Expo -Impo Bank
A ica CDC A ica Cen es o Disease Con ol and P e en ion
AIDS Acqui ed Immune De iciency Synd ome
AMA A ican Medicines Agency
AMRH A ican Medicines Regula o y Ha moniza ion
API ac i e pha maceu ical ing edien s
ARSO A ican O ganisa ion o S anda disa ion
AU A ican Union
BADEA A ab Bank o Economic De elopmen in A ica
∆CC change o chap e
∆CTH change o a i heading
∆CTSH change o a i sub-heading
CPPM Cen alised Pooled P ocu emen Mechanism
CTC Change in Ta i Classi ica ion
EAC Eas A ican Communi y
ECDS Eas e n Ca ibbean D ug Se ice
EU Eu opean Union
GCC GPP Gul Coope a ion Council G oup Pu chasing P og am
GHG g eenhouse gas
GPO g oup pu chasing o ganisa ion
HIV Human Immunode iciency Vi us
IPR in ellec ual p ope y igh s
ITFC In e na ional Islamic T ade Finance Co po a ion
MFN mos - a ou ed na ion
OECS O ganisa ion o Eas e n Ca ibbean S a es
PAHO Pan Ame ican Heal h O ganiza ion
R&D esea ch and de elopmen
RoOs ules o o igin
SADC Sou he n A ican De elopmen Communi y
SP Speci ic P oduc ion
SPPS SADC Pooled P ocu emen o Pha maceu icals
Se ices
UNECA Uni ed Na ions Commission o A ica
UK Uni ed Kingdom
US Uni ed S a es
VA Value Added
WITS Wo ld In eg a ed T ade Solu ion
ODI Repo
6
Execu i e summa y
P ices o essen ial medicines a e signi ican ly highe in many A ican
coun ies compa ed wi h he lowes in e na ional e e ence le els.
One o he easons o his is buye agmen a ion and lack o
domes ic pha maceu ical manu ac u ing capaci y. E o s a e
unde way o coo dina e he p ocu emen o accines and o he
pha maceu ical p oduc s ac oss he con inen o capi alise on cos
ad an ages. Simul aneously, he e is a conce ed e o o de elop
con inen al alue chains wi hin he pha maceu ical sec o ,
encompassing mul i-s ep p oduc ion p ocesses, including he
sou cing o aw ma e ials. The A ican Con inen al F ee T ade A ea
(A CFTA) can play a pi o al ole in acili a ing hese endea ou s,
he eby con ibu ing o he ad ancemen o he pha maceu ical sec o
in A ica.
This epo bene i s om he collabo a ion wi h he Nelson Mandela
School o Public Go e nance o he Uni e si y o Cape Town aimed
a de eloping a con inen al s a egy o he de elopmen o he
pha maceu ical indus y unde he A CFTA (UCT-ODI, 2024). In his
sense, bo h epo s eed each o he wi h in o ma ion and insigh s.
The A CFTA p o ides a i - ee access o A ican ma ke s o i ms
ha mee i s ules o o igin (RoOs). Howe e , p oduc s ha do no
mee RoO c i e ia a e subjec o a i s. Complying wi h RoOs incu s
cos s: i ms mus compa e he p e e en ial a i s unde he A CFTA
wi h he cos s o compliance.
Ou analysis indica es ha he RoOs o pha maceu ical p oduc s a e
mode a ely es ic i e. Addi ionally, A ican coun ies impose ei he
ze o o e y low mos - a ou ed na ion (MFN) a i s on
pha maceu ical and accine p oduc s. Consequen ly, he p e e en ial
a i bene i s o i ms mee ing RoOs unde he A CFTA a e minimal.
Fi ms may op o ade unde MFN a i s ega dless o RoO
es ic i eness, wi h posi i e implica ions o pooled p ocu emen .
Gi en hese low a i a es, he pooled p ocu emen ini ia i e may
emain la gely una ec ed by RoOs. Wai ing he RoO equi emen o
pha maceu ical and accine p oduc s could u he simpli y
p ocu emen .
Con e sely, RoOs could in luence ini ia i es o p oduce
pha maceu ical and accine p oduc s wi hin A ica. RoOs a ec
sou cing decisions o in e media e inpu s and he de elopmen o
egional alue chains. S ic RoOs may encou age sou cing wi hin
he A CFTA, whe eas lenien RoOs may lead o sou cing om
ODI Repo
7
ou side he egion, po en ially hinde ing egional alue chains. Fo
accine ing edien s and packaging, se e al A ican coun ies impose
highe MFN a i s, c ea ing signi ican p e e en ial ma gins i hese
inpu s a e sou ced o p oduced wi hin A ica. This incen i ises
pha maceu ical p oduce s o sou ce inpu s wi hin he A CFTA and
encou ages non-A ican i ms o eloca e o A ica, os e ing local
pha maceu ical manu ac u ing and egional alue chains. Balancing
RoOs and a i s a e c ucial o suppo pooled p ocu emen ini ia i es
and he de elopmen o local manu ac u ing in A ica. The e o e, a
ca e ul balance mus be main ained in his con ex .
Fu he mo e, nego ia ing he elaxa ion o he cu en RoOs o
pha maceu ical p oduc s in pooled p ocu emen scena ios
could allow o he impo a ion o goods wi hou s ic
adhe ence o RoO equi emen s, hus easing ade ac oss
bo de s. Mo eo e , i may be impo an o conside he
implemen a ion o sel -ce i ica ion o RoOs. Cu en ly, RoO
ce i ica ion mus be ca ied ou by an app o ed expo e o a
designa ed compe en au ho i y o he expo ing s a e pa y. This
p ocess can be bu densome and ime-consuming, pa icula ly o
small and medium-sized en e p ises. In oducing sel -ce i ica ion,
cu en ly limi ed o consignmen s alued below $5,000, could
subs an ially educe he expenses linked wi h RoOs o ade s.
Reducing a i s and non- a i ba ie s on impo ed c i ical
pha maceu ical componen s like ac i e pha maceu ical
ing edien s (APIs) will os e he cos -compe i i eness o
p oduce s o c i ical inal heal h p oduc s. Common ex e nal
a i s could be necessa y o p o ec A ican p oduce s and achie e
he goal o boos ing ade and economic in eg a ion. Howe e , hey
may also hinde he g ow h o he pha maceu ical sec o , gi en
limi ed p oduc ion capaci y, pa icula ly o APIs. The e o e,
dec easing a i ba ie s on impo ed essen ial pha maceu ical
componen s like APIs could be economically ad an ageous in he
sho o medium e m. This measu e aims o suppo p oduce s in
a aining cos -compe i i eness in manu ac u ing c i ical heal hca e
p oduc s.
Addi ionally, unnecessa y echnical ba ie s, in he o m o non- a i
ba ie s such as non-cohe en medicine egula ions, weak medicine
egula o y capaci y and agmen a ion o s anda ds ac oss coun ies,
hampe s pha maceu ical p oduc ion and ade. To his end, he
e ec i eness and e iciency o he A ican O ganisa ion o
S anda disa ion (ARSO) and he A ican Medicines Regula o y
Ha moniza ion (AMRH) p og amme is c ucial o c ea ing a egula o y
en i onmen and gua an eeing s anda ds o os e he ad ancemen
o he pha maceu ical indus y. Speci ically, apidi y and
e ec i eness in he adop ion o s anda ds and echnical egula ions
ARSO is cu en ly implemen ing as pa o i s S anda ds o
Pha maceu ical and Medical De ices in A ica P ojec will
ODI Repo
8
signi ican ly suppo expanded p oduc ion and in a-A ican ade in
quali y pha maceu ical p oduc s.
Adop ing capaci y-building measu es will boos he echnical
capaci y o p ocu emen bodies and bo de managemen
au ho i ies. Imp o ing he echnical capaci ies o buye s o
p ocu e s will be c ucial. Such capaci ies, especially hose ela ed o
o ecas ing po en ial demand and assessing he heal h p oduc
needs o a pa icula demog aphic g oup o popula ion, a e i al.
Capaci y-building he e will con ibu e o he imely p ocu emen o
heal h p oduc s, especially u gen ly needed ones like accines du ing
imes o heal h c isis. To enhance he e iciency o c oss-bo de ade
acili a ed by pooled p ocu emen , he echnical capaci ies o
pe sonnel esponsible o c oss-bo de ade, c ucially, bo de
managemen au ho i ies, should be imp o ed.
ODI Repo
15
2.3.3 Gul Coope a ion Council G oup Pu chasing P og am
The GCC GPP, ini ia ed in 1997 among se en Pe sian Gul s a es
(wi h Yemen joining in 2004), join ly issues ende s o accines,
d ugs and medical goods. This p og amme add esses he challenge
o high p ices and he di icul y o p ocu ing he small quan i ies ha
coun ies equi e. The pooled p ocu emen model is a ‘g oup
con ac ing’ p og amme whe eby coun ies independen ly con ac
wi h and pay p oduce s once he g oup has selec ed he winning
bids. The p og amme has issued 10 ende s in ol ing nea ly 8,900
di e en p oduc s alued a $508 million in 2003 and has been
inc easing. I has success ully cu cos s and ensu ed a consis en
and su icien supply o accines o membe coun ies.
2.3.4 Pan Ame ican Heal h O ganiza ion
The PAHO Re ol ing Fund was es ablished in 1979 o enhance
immunisa ion p og ammes ac oss he Ame icas. I p ocu es supplies
on behal o mo e han 35 coun ies in La in Ame ica and he
Ca ibbean. The pooled p ocu emen model is he ‘cen al con ac ing'
model, which manages mos aspec s o p ocu emen , om ende ing
o con ac ing wi h and paying p oduce s. I uses a common und o
compensa e p oduce s be o e eimbu semen by coun ies upon
eceip o goods. The p og amme has success ully educed cos s
and ensu ed a consis en supply o medicines.
2.3.5 O ganisa ion o Eas e n Ca ibbean S a es
The OECS es ablished he Eas e n Ca ibbean D ug Se ice (ECDS)
in he la e 1980s, comp ising nine small island na ions. The ECDS
p ocu es pha maceu icals and medical supplies o he nine
minis ies o heal h o he OECS coun ies. I uses a cen alised
con ac ual pu chasing model. The ECDS ope a es a cen alised,
es ic ed ende ing sys em, p e-quali ying all app o ed supplie s
h ough a egis a ion ques ionnai e. I solici s bids om in e na ional
supplie s, awa ds annual con ac s, places o de s di ec ly wi h
supplie s and moni o s deli e y and supplie pe o mance.
Pa maksiz e al. (2022) conduc ed a sys ema ic e iew o a ious
s udies on he pooled p ocu emen o medicines and accines o
iden i y he key elemen s o success. They iden i ied se e al
essen ial ac o s necessa y o he e ec i e unc ioning o pooled
p ocu emen mechanisms. Fi s , o pa icipa ion in pooled
p ocu emen , buye s equi e adequa e le els o echnical and
inancial capaci y, and compa ible laws and egula ions. Second, o
he execu ion o pooled p ocu emen , he o ganisa ion mus possess
su icien inancial and echnical expe ise, and ope a e
independen ly. Thi d, o ensu e he p o ision o heal h commodi ies
o he mechanism, supplie s need adequa e incen i es, such as a
su icien ly la ge ma ke size and a p omp paymen mechanism.
ODI Repo
16
3 Assessmen o
con inen al and A CFTA
policies and p o ocols
T ade wi hin A ica and wi h he es o he wo ld
in c i ical p oduc s
A ica elies hea ily on impo s o pha maceu ical and accine
p oduc s om he es o he wo ld. Figu e 1 shows he dynamics o
ex a-A ica expo s and impo s in pha maceu icals and accine
p oduc s as well as c i ical accine inpu s. O e he pas decade,
he e has been a consis en inc ease in hese impo s. In 2021, A ica
impo ed a subs an ial $17 billion wo h o pha maceu ical p oduc s
om ou side he con inen , a signi ican ise om $6.6 billion in 2017.
The su ge in accine impo s in 2021 was d i en signi ican ly by he
COVID-19 pandemic. Con e sely, A ica’s expo s o he es o he
wo ld amoun ed o only $0.9 billion in he same yea . This esul s in a
conside able ade de ici in pha maceu ical p oduc s and accines.
This de ici has been on he ise o e he pas wo decades.
Figu es 2C and 2D show impo s and expo s o accine- ela ed
inpu s by ca ego y om he es o he wo ld.3 Mos o he impo s
consis p ima ily o packaging ma e ials a he han ing edien s o
u he p ocessing. The majo i y o accine- ela ed inpu s in expo s
and impo s pe ain o seconda y packaging o accine
adminis a ion and packaging ma e ials o s o age and dis ibu ion.
India is A ica’s main sou ce o impo s o pha maceu ical p oduc s
(Figu e 3). In 2022, A ican impo s om India we e a $3 billion,
co e ing 21% o he con inen ’s o al impo s. This was ollowed by
impo s om F ance, a $1.2 billion (11%) and om Ge many and he
US, each a $1.2 billion (8%). These ou coun ies accoun o close
o 50% o A ica’s pha maceu ical impo s. Excep o in India, almos
all impo s a e mainly om ad anced coun ies’ economies such as
he EU and he US.
Belgium and he US a e he main sou ces o accine impo s o
A ica, each co e ing 28% and 16% o accine impo s in 2022.
3 See Appendix 1 o he lis o selec ed accine- ela ed inpu s conside ed in his s udy.
ODI Repo
17
Figu e 2 Ex a-A ica ade in pha maceu ical and accine
p oduc s, 2012–2022 ($ million)
A. Pha maceu ical p oduc s
B. Vaccines
C. Expo s o accine- ela ed inpu s
D. Impo s o accine- ela ed inpu s
Sou ce: Au ho s’ elabo a ion om WITS da abase
Figu e 3 Sou ces o impo s o pha ma p oduc s (ex a-
A ica), 2022 (%)
A. Sou ces o pha ma impo s
B. Sou ces o accine impo s
Sou ce: Au ho s’ elabo a ion using (2022) da a om he WITS da abase
-20,000
-15,000
-10,000
-5,000
-
5,000
10,000
15,000
20,000
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Balance Expo Impo
-4,000
-3,000
-2,000
-1,000
-
1,000
2,000
3,000
4,000
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Balance Expo Impo
-
200
400
600
800
1,000
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Seconda y packaging-Vaccine adminis a ion
Seconda y packaging-S o age and dis ibu ion
P ima y packaging
Ing edien s
-
1,000
2,000
3,000
4,000
5,000
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Seconda y packaging-Vaccine adminis a ion
Seconda y packaging-S o age and dis ibu ion
P ima y packaging
Ing edien s
0 5 10 15 20 25
India
F ance
Ge many
Uni ed S a es
Belgium
China
Swi ze land
Ne he lands
I aly
I eland
Denma k
Spain
Uni ed Kingdom
Res o he Wo ld
010 20 30
Belgium
Uni ed S a es
China
Ne he lands
India
F ance
Denma k
Hong Kong, China
Ge many
Ko ea, Rep.
I eland
Res o he Wo ld
ODI Repo
18
Figu e 4 shows ex a-A ica pha maceu ical and accine p oduc
expo s and impo s by indi idual A ican coun ies. I shows ha
Sou h A ica and Egyp a e he p edominan expo e s o
pha maceu ical and accine p oduc s om A ica o he es o he
wo ld (ex a-A ica expo s). These wo na ions alone accoun ed o
o e 75% o A ica’s expo s in 2022. O e 2015–2022, hey
collec i ely ep esen ed mo e han wo- hi ds o he con inen ’s
expo s globally. Speci ically, in 2022, Sou h A ica expo ed
pha maceu ical p oduc s o alling $420 million, while Egyp expo ed
$283 million wo h o p oduc s o in e na ional ma ke s.
Bo h Egyp and Sou h A ica a e also he wo la ges impo e s o
pha maceu ical p oduc s wi hin he con inen . Egyp impo ed
p oduc s alued a $3.5 billion, while Sou h A ica impo ed goods
wo h $2.5 billion. Following closely behind as op impo e s a e
Nige ia ($1.1 billion), Mo occo, and E hiopia (each a $0.8 billion).
Figu e 4 A ica pha maceu ical expo e s and impo e s
coun ies (ex a-A ica)
A. Expo
B. Impo , 2022
Sou ce: Au ho s’ elabo a ion om WITS da abase
3.1.1 In a-A ica pha ma and accine ade
The in a-A ica pha maceu ical and accine ade is no signi ican .
Fo ins ance, in 2021, he in a-A ica ade o pha maceu ical
p oduc s amoun ed o $536 million; accine ade was smalle , a $51
million, in he same pe iod. A signi ican po ion o pha maceu ical
p oduc s is expo ed wi hin he con inen . Fo ins ance, in 2021,
app oxima ely 35% o A ica's global expo s we e aded wi hin
A ica. Howe e , his is a decline in 2012, when mo e han 70% o
pha maceu ical A ica's expo s we e in a-con inen al.
Rega ding accine- ela ed inpu s in in a-A ica ade, Figu e 5
illus a es ha a subs an ial sha e o in a-A ica expo s is ela ed o
0
10
20
30
40
50
60
70
80
90
100
2015
2016
2017
2018
2019
2020
2021
2022
%
Egyp Kenya
Mo occo Res o A ica
Sou h A ica Tunisia
02,000 4,000
Egyp
Sou h A ica
Nige ia
Mo occo
E hiopia
Kenya
Tanzania
Angola
Tunisia
Co e d'I oi e
Zambia
Senegal
Bu kina Faso
Mozambique
Congo, Dem. Rep.
Res o A ica
$ million
ODI Repo
19
packaging and accine adminis a ion p oduc s, while ade in
ing edien s emains minimal. In 2021, o al expo s in in a-A ica
ade amoun ed o $807 million. Howe e , only $11 million o his
cons i u ed ing edien s, wi h he emainde comp ising p ima y and
seconda y packaging and accine adminis a ion p oduc s.
In a-A ica pha maceu ical expo s a e d i en p edominan ly by a
ew coun ies. Sou h A ica leads, wi h expo s o alling $307 million,
comp ising 57% o he o al in a-A ica pha maceu ical ade. Kenya
ollows wi h $98 million, accoun ing o 18%. Al hough Egyp is a
majo expo e o pha maceu ical p oduc s globally om A ica, i s
sha e o expo s o A ica s ands a jus 5%.
Figu e 5 In a-A ica pha maceu ical ade
A. A ica in a-pha maceu ical
p oduc s expo s
B. A ica in a- accine- ela ed inpu s
expo s
C. In a-A ica pha ma expo e s, 2021
D. Sha e o pha ma impo s om A ica,
2021
Sou ce: Au ho s’ elabo a ion om WITS da abase
In e ms o c i ical accine- ela ed inpu s in in a-A ica expo s,
Sou h A ica main ains i s leading posi ion, wi h expo s alued a
$291 million. Rwanda and Mo occo ollow, wi h $88 million and $84
million, espec i ely. Tunisia and Egyp eme ge as majo expo e s o
accine- ela ed inpu s; howe e , he majo i y o hei expo s a e
di ec ed ou side o A ica a he han wi hin.
A hand ul o coun ies impo a po ion o hei o al pha maceu ical
p oduc s om A ica. Namibia has 46% o i s impo s o igina ing om
0
10
20
30
40
50
60
70
80
0
100
200
300
400
500
600
700
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
%
$ million
Expo
sha e o a ica expo ha goes o a ica (%)
0
200
400
600
800
1000
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
Seconda y packaging-Vaccine adminis a ion
Seconda y packaging-S o age and dis ibu ion
P ima y packaging
Ing edien s
0100 200 300 400
Sou h A ica
Kenya
Uganda
Egyp
Mo occo
Bo swana
Tunisia
Res o A ica
$ million
010 20 30 40 50
Namibia
Bo swana
Eswa ini
Leso ho
Zimbabwe
CAR
Zambia
Como os
Seychelles
%
ODI Repo
20
A ica; Bo swana ollows closely wi h 40%. Eswa ini and Leso ho
impo 29% and 28% o hei o al pha maceu ical p oduc s om
A ica, espec i ely, wi h Zimbabwe close behind a 26%. These
coun ies a e loca ed in Sou he n A ica.
3.1.2 Ta i s
Se e al coun ies in A ica impose a i s on impo ed pha maceu ical
p oduc s. Table 1 epo s he a e age applied mos - a ou ed-na ion
(MFN) a i on pha maceu ical p oduc s and inpu s o 2021. Twen y
A ican coun ies main ain a ze o-applied MFN a i . The es impose
a i s. Mo occo has he highes a i s, a 12.9%, ollowed by Alge ia
a 4.9% and E hiopia a 4.2%.
Table 1 Pha maceu ical p oduc a i s
Coun y
Pha ma
Vaccine
Vaccine- ela ed inpu s
Ing edien s
P ima y
packaging
Seconda y
packaging –
s o age and
dis ibu ion
Seconda y
packaging –
accine
adminis a ion
Alge ia
4.9
2.5
15.0
22.5
21.0
21.7
Angola
0.5
0.0
0.0
13.0
35.0
0.0
Benin
0.0
0.0
5.0
10.0
12.4
5.0
Bo swana
0.3
0.0
0.0
7.4
9.7
5.0
Bu kina Faso
0.0
0.0
5.0
10.0
12.4
5.0
Bu undi
0.6
0.0
1.7
17.5
18.1
0.0
Cape Ve de
0.7
0.0
0.0
7.5
3.1
0.0
Como os
0.0
0.0
20.0
12.5
9.2
0.0
Cô e d'I oi e
0.0
0.0
5.0
10.0
12.4
5.0
Eswa ini
0.3
0.0
0.0
7.4
9.7
5.0
E hiopia
4.2
0.0
10.4
25.0
12.2
5.0
Gambia, The
0.0
0.0
5.0
10.0
12.4
5.0
Ghana
0.0
0.0
5.0
10.0
12.4
5.0
Guinea
0.0
0.0
5.0
10.0
12.4
5.0
Guinea-Bissau
0.0
0.0
5.0
10.0
12.4
5.0
Kenya
0.6
0.0
1.7
17.5
18.3
0.0
Leso ho
0.3
0.0
0.0
7.4
9.7
5.0
Libe ia
0.0
0.0
5.0
10.0
12.4
5.0
Libya
0.1
0.0
5.0
5.0
3.9
0.0
Madagasca
0.0
0.0
4.2
14.4
7.6
0.0
Malawi
0.2
0.0
0.0
17.5
13.8
0.0
Mali
0.0
0.0
5.0
10.0
12.4
5.0
Mau i ania
0.0
0.0
5.0
10.0
11.2
5.0
Mau i ius
0.0
0.0
0.0
0.0
0.4
0.0
Mo occo
12.9
10.0
9.4
29.2
17.4
2.5
Mozambique
0.0
0.0
1.7
13.8
10.0
5.0
Namibia
0.3
0.0
0.0
7.4
9.7
5.0
Nige
0.0
0.0
5.0
10.0
12.4
5.0
Nige ia
0.0
0.0
5.0
10.0
12.4
5.0
Rwanda
0.6
0.0
1.7
17.5
18.1
0.0
Senegal
0.0
0.0
5.0
10.0
12.4
5.0
Seychelles
0.0
0.0
0.0
5.0
0.0
0.0
Sie a Leone
0.0
0.0
5.0
10.0
12.4
5.0
Sou h A ica
0.3
0.0
0.0
7.4
9.7
5.0
Tanzania
0.6
0.0
1.7
17.5
18.1
0.0
Togo
0.0
0.0
5.0
10.0
12.4
5.0
Uganda
0.6
0.0
1.7
17.5
20.0
0.0
Zambia
0.3
0.0
5.4
13.5
18.8
0.0
Zimbabwe
3.8
0.0
4.2
16.9
29.6
2.5
Sou ce: Au ho s’ elabo a ion om WITS da abase
Rules o o igin on pha maceu icals and accines
The A CFTA p o ides a i - ee access o A ica’s ma ke s p o ided
i ms mee he RoOs ou lined in he Ag eemen . The aim o he RoOs
ODI Repo
21
is o p o ide p e e en ial a i bene i s exclusi ely o A CFTA membe
na ions while p e en ing ade di e sion om non-membe coun ies.
Consequen ly, p oduc s ailing o mee RoO equi emen s a e subjec
o a i s.
Howe e , challenges a ise in he con ex o he ini ia i e on pooled
p ocu emen o pha maceu ical p oduc s a he con inen al le el.
Pha maceu ical p oduc s may be p ocu ed ei he wi hin A ica o om
ou side he con inen . I he pooled p ocu emen is om
manu ac u e s and p oduc s p oduced wi hin A ica and all mee RoO
equi emen s, his does no pose an issue o he pha maceu ical
ini ia i e. Implemen a ion o he A CFTA will acili a e his p ocess.
Howe e , i is imp obable ha all pha maceu ical and accine
p oduc ion wi hin A ica will mee he RoOs ou lined in he
Ag eemen . This is p ima ily because o he global na u e o
pha maceu ical and accine p oduc ion, which elies on mul iple
ing edien s and alue chains spanning ac oss he globe.
Also, A ica impo s a signi ican po ion o i s pha maceu icals and
accines om ou side A ica. I pha maceu ical p oduc s a e
p ocu ed om ou side A ica as pa o pooled p ocu emen , hey do
no mee RoO equi emen s and a e hus subjec o a i s. In
addi ion, in 2022, o e 20 A ican coun ies s ill impose a i s on
pha maceu ical p oduc s.
This highligh s how RoO o igin equi emen s o pooled p ocu emen
o pha maceu ical p oduc s can ha e signi ican impac s on ade,
especially in scena ios in ol ing in e -coun y ade. The ex en o
his impac a ies based on he chosen p ocu emen mode. S ingen
and cos ly RoOs ha e he po en ial o hinde ade in pha maceu ical
p oduc s among A ican coun ies, he eby a ec ing egional
pha maceu ical and accine p ocu emen ini ia i es.
3.2.1 Rules o o igin o pha maceu icals unde he A CFTA
Unde he A CFTA, p oduc -speci ic RoOs a e se a he 6-digi HS
code le el. Fo pha maceu ical p oduc s, he RoOs s ipula e
‘Manu ac u e om Ma e ials o any Heading, excep ha o he
P oduc o Manu ac u e in which he alue o he Ma e ials used does
no exceed 60% o he ex-wo ks p ice o he P oduc o Chemical
p ocessing ules as pe In oduc o y No e 8 o his Appendix.’ This
implies ha ade s o i ms ha e he op ion o choose be ween
Change in Ta i Classi ica ion (CTC), Value Added (VA) o Speci ic
P oduc ion P ocess (SP) o comply wi h he ules. In o he wo ds,
he e mus be a su icien p oduc ion p ocess o claim o igin. These
ules apply o all pha maceu ical p oduc s in he A CFTA.
The CTC ule equi es subs an ial ans o ma ion in p oduc ion
leading o a change in a i classi ica ion om non-o igina ing
ma e ials used when expo ed as a inal p oduc . The VA ule se s a
limi on he maximum non-o igina ing alue ha can be used o an
ODI Repo
22
expo ed p oduc . Unde his ule, he maximum alue o non-
o igina ing ma e ials is de ined. The SP ule g an s o igina ing s a us
o a good i i has unde gone a speci ic p oduc ion p ocess,
speci ying a se o p oduc ion p ocesses necessa y o a good o be
conside ed o igina ing.
The challenge o i ms in mee ing RoOs o pha maceu ical p oduc s
a ies depending on he speci ic i m and p oduc . Howe e , exis ing
li e a u e, including wo ks by Es e adeo dal (2000), Anson e al.
(2005) and Cado e al. (2006), indica es ha RoOs based on
changes o chap e (∆CC) a e mo e s ingen compa ed wi h hose
based on changes o heading (∆CTH), which, in u n, a e mo e
es ic i e han ules based on changes o subheading (∆CTSH).
Cu en ly, one o he c i e ia o mee ing RoOs is a change in
heading. Addi ionally, he VA equi emen s, whe e he alue o
ma e ials used should no exceed 60% o he ex-wo ks p ice o he
p oduc , signi y ha a signi ican po ion o he alue added in he
manu ac u ing p ocess o igina es om wi hin he coun y o egion
whe e he p oduc is claimed o be manu ac u ed. The di icul y le el
in complying wi h he SP ule can a y signi ican ly ac oss indus ies
bu i speci ies a se o p oduc ion o chemical p ocesses su icien
o he p oduc o be conside ed o igin. In summa y, hese ules
indica e ha mee ing RoO equi emen s o i ms is no easy.
In addi ion o p oduc -speci ic RoOs, he e a e also egime-wide
RoOs, which a e applied o all goods aded unde he A CFTA.
These a e no speci ic o any p oduc . Some o hese egime-wide
RoOs o e lexibili y o he p oduc -speci ic RoOs, including de
minimis (o ole ance) and cumula ion. The de minimis ule p o ides
leniency in RoOs by pe mi ing he use o a small pe cen age o non-
o igina ing ma e ials in p oduc ion. This means ha , e en i a p oduc
does no mee he p oduc -speci ic RoO c i e ia o p e e en ial a i
ea men , i may s ill quali y as o igina ing unde he b oade de
minimis RoO c i e ia. The cumula ion ule allows p oduce s wi hin a
ee ade a ea o u ilise inpu s om o he membe coun ies wi hou
losing he p e e en ial s a us o he inal p oduc . In bila e al
cumula ion, an o igina ing inpu om one coun y e ains i s o igin
s a us when used in ano he coun y's p oduc ion p ocess. In
diagonal cumula ion, o igina ing inpu s om each membe coun y
a e conside ed o o igina e om inpu s in o he membe coun ies.
The A CFTA allows diagonal cumula ion, ea ing all A ican coun ies
as a single e i o y o o igin de e mina ion. Consequen ly, any
p oduc ha has ob ained o igin s a us in any pa o he a ea
co e ed by he A CFTA will be deemed as o igina ing in ano he
coun y when used as an inpu in p oducing ano he p oduc . These
ules p o ide suppo o ini ia i es such as pooled p ocu emen .
3.2.2 Possible ac ions o suppo con inen al-le el
p ocu emen
ODI Repo
23
One possible solu ion o suppo he pooled p ocu emen ini ia i e
unde he A CFTA a angemen is he op ion o nego ia e elaxa ion
o he cu en RoOs o pha maceu ical p oduc s in pooled
p ocu emen scena ios o ou line al e na i e RoOs o igin o
p ocedu es o de e mining eligibili y o a i p e e ences. This may
pe mi he impo a ion o p oduc s wi hou he need o s ic ly mee
he usual RoO equi emen s, acili a ing ade ac oss bo de s.
P o ocol p o isions in ela ion o ules and
p ocedu es in he A CFTA
The A CFTA has p o ocols ha can acili a e inc eased p oduc ion,
ade and in es men , which could con ibu e o economic
de elopmen . This is because, as o o he p io i y indus ies o he
A CFTA, he p o isions and objec i es o hese p o ocols seek o
suppo he de elopmen o a obus pha maceu ical indus y.
Expanding he pha maceu ical indus y will be c ucial as A ica has a
high disease bu den and limi ed access o medicines and is s ill
highly impo -dependen o i s pha maceu icals. Thus, i success ully
implemen ed, he p o ocols can bols e access o a o dable, high-
quali y, e icacious pha maceu ical p oduc s.
3.3.1 A CFTA p o ocols o ade in goods and se ices
The A CFTA p o ocols o ade in goods and se ices we e
nego ia ed in he ini ial s ages (phase I) o he Ag eemen , wi h
discussions cen ed on a eas like a i schedules and RoOs and
se ices such as anspo a ion and business se ices.
As de ailed in A icle 3 o he A CFTA Ag eemen , he p o ocols
ad oca e o he g adual emo al o a i and non- a i ba ie s,
pa ing he way o a libe alised p oduc ma ke . Thus, hey can
bols e in a-A ican ade in pha maceu icals. C ea ing a subs an ial
egional ma ke has he powe o a ac mo e manu ac u e s,
he eby expanding he size o A ica’s pha maceu ical indus y.
To pu hings in con ex , he ma ke size o A ica’s pha maceu ical
indus y, gauged as he alue o he indus y, was es ima ed o be
be ween $40 billion and $60 billion in 2020, which is pale compa ed
wi h hose o he US (es ima ed alue o $393 billion) and Japan
($123 billion) (McKinsey & Company, 2015). The small size o
A ica’s pha maceu ical indus y, e en hough he con inen bea s
signi ican sha es o he wo ld’s communicable and non-
communicable disease bu dens (Na ayan, 2016; Bigna and Noubiap,
2019), owes o he small numbe o pha maceu ical companies. Mo e
speci ically, in 2020, A ica had 600 pha maceu ical manu ac u e s,
much lowe han he numbe in India (20,500) and China (5,000),
which ha e popula ions simila in size o ha o A ica (Conway e al.,
2019; Ussai e al., 2022).
Hence, e ec i e use o he p o ocols o goods and se ices can be
c i ical o inc easing he size o manu ac u ing capaci y and making
ODI Repo
24
i mo e capable o inc easing access o a o dable, high-quali y and
e icacious pha maceu ical p oduc s. S udies (Sidibé e al., 2014;
Lakdawalla, 2018; Benne and Yin, 2019) show ha economies o
scale, con ibu ing o cos educ ion and highe quali y o
pha maceu ical p oduc s, a e associa ed wi h p oducing o la ge
ma ke s.
3.3.2 P o ocol on ules and p ocedu es on he se lemen
o dispu es
The A CFTA ecognises he need o a amewo k o ules and
p ocedu es o dispu e esolu ion associa ed wi h issues, including
he ade and p ocu emen o pha maceu ical p oduc s. The main
objec i e is o ensu e ha he amewo k es ablished o dispu e
esolu ion is anspa en , ai , accoun able, and p edic able,
acco ding o he p o isions o he A CFTA Ag eemen .
The e icacy o p ocu emen in expanding he ma ke o A ican-
manu ac u ed pha maceu icals will depend mainly on he ules and
egula ions ega ding dispu e esolu ion associa ed wi h
p ocu emen . These can s eng hen us and coope a ion be ween
p oduce s and buye s on he con inen , especially in pooled
p ocu emen mechanisms.
Howe e , he cu en o m o his p o ocol is e ec i e only o
esol ing in e -s a e dispu es, as i is no accessible o he p i a e
sec o o indi iduals. Thus, since he p i a e sec o will be salien o
he e ec i eness o pooled p ocu emen , his p o ocol will need o be
made accessible o he p i a e sec o o enhance i s e ec i eness by
s eng hening us and coope a ion be ween buye s and selle s.
Addi ional suppo o his a gumen is ha exis ing dispu e se lemen
mechanisms in A ica end o ha e mo e cases when accessible o
he p i a e sec o , as in he Economic Communi y o Wes A ican
S a es and he EAC (Tsighe, 2019).
3.3.3 P o ocols on in es men , in ellec ual p ope y igh s
and compe i ion policy
To inc ease he local supply o pha maceu icals, mo e in a-A ican
in es men unde pinned by a be e in es men en i onmen ,
p o iding a clima e o ai compe i ion, will be equi ed. The A CFTA
p o ocols on in es men , in ellec ual p ope y igh s and compe i ion
we e c ea ed o his pu pose. These we e nego ia ed in phase II o
he Ag eemen and adop ed on 19 Feb ua y 2023 by he AU
Assembly o Heads o S a e and Go e nmen (UNECA, 2023b).
The p o ocol on in es men aims o acili a e in a-A ican in es men
wi h anspa en and p edic able legal p o isions o guide lows and
se le dispu es. Inc easing in a-A ican in es men in he
pha maceu ical sec o will be c i ical o sp eading he economic
bene i s (e.g., c ea ing jobs and inc easing o eign exchange
ODI Repo
31
a esul o he po en ial ise in local manu ac u ing and e icien
p ocu emen mechanisms on he con inen . Sus ainable access o
a o dable, high-quali y, e icacious pha maceu ical p oduc s,
especially in a eas ha d-hi by clima e change, like No h and Wes
A ica, will be c ucial in a enua ing he heal h issues induced by
accumula ed clima e impac s.
Second, he A CFTA p o ocols on in es men go e nance and IPR
could ha e signi ican implica ions o pha maceu ical R&D. This
could in luence he ex en o which he indus y can con ibu e o he
impac s o clima e change. Mo e pha maceu ical R&D and s ingen
IPR ( o suppo mo e FDI in lows) will be equi ed o inc ease he
indus y’s capaci y and p oduce inno a i e medicines o espond o
heal h needs. By p o iding p o isions on in es men go e nance and
IPR, he A CFTA can hus help inc ease in es o in lows and R&D in
he pha maceu ical sec o . As a no able example, mos
pha maceu ical supply chains in A ica do no ha e he in as uc u e
(e.g., cold chains) o adequa e s o age, deli e y and implemen a ion
o medicines. Inno a ions o de elop mo e hea - ole able medica ion
will be c ucial in his ega d.
Thi d, e icien pooled p ocu emen mechanisms, enabled h ough
he po en ial c ea ion o a sizeable libe alised pha maceu ical ma ke
as a esul o he A CFTA, unde pinned by ha monised egula ions,
will in luence how much manu ac u e s emi . Ha monising
manu ac u ing s anda ds will ensu e manu ac u e s ac oss he
con inen p oduce mo e medicines wi h less en i onmen al impac .
Gende
Implemen ing he A CFTA p o ocols may ha e signi ican implica ions
o gende . These could s em om pa icipa ion wi hin he
pha maceu ical indus y and how he p o ocols a ec he accessibili y
o a o dable, high-quali y, e icacious pha maceu ical p oduc s.
The pha maceu ical wo k o ce will be c ucial o he e ec i eness o
he A CFTA in imp o ing A ica’s heal h indus y. I plays a pi o al
ole in p oducing, dis ibu ing and implemen ing pha maceu ical
p oduc s, which a e all salien o de eloping a obus pha maceu ical
indus y. Globally, women make up mos o he pha maceu ical
wo k o ce (Bukha i e al., 2020). Ye hey end o be ound p ima ily
in low-paying indus y segmen s, unde ep esen ed in leade ship and
decision-making oles compa ed wi h hei male coun e pa s. One
s udy ound ha men headed 69% o global heal h o ganisa ions and
we e boa d chai s o 80% (Bukha i e al., 2020).
Inc easing he ep esen a ion o women in he indus y is impe a i e
no only o gende equali y bu , mo e impo an ly, o d i e p oduc i e
inno a ion, enhance he s anda ds o medicines, especially hose
equi ed by women, and ensu e mo e e ec i e decision-making.
Speci ically, on he inno a ion-enhancing p ospec s o gende
inclusion, inc easing he pool o pha maceu ical wo ke s, especially
ODI Repo
32
in op hie a chies, o include women, ensu es ha he pool is mo e
di e se ega ding knowledge, skills and expe iences o suppo
inno a i e ideas o women- ela ed heal h needs. Since A ica
aspi es o le e age oppo uni ies p o ided h ough he A CFTA o
de elop a obus pha maceu ical indus y, his will be an oppo uni y
o make he sec o mo e gende -inclusi e o enhance i s obus ness.
Simila ly, in he con ex o p ocu emen mechanisms, ensu ing ha
women a e ep esen ed in all ca ego ies (buye s, p ocu emen
o ganisa ions and supplie s) o p ocu emen mechanisms will be
impe a i e o he e iciency and e ec i eness o hese mechanisms,
especially o women- ela ed heal h needs. Mo e emales
pa icipa ing as buye s and in he p ocu emen o ganisa ion in a
p ocu emen mechanism will inc ease he po en ial o use
monopsony powe (ba gaining) and nego ia ions o p ocu e high-
quali y medicines mo e conduci e o he heal h needs o women.
Simila ly, a mo e gende -inclusi e supplie pool is likely o conside
p oducing medica ions o high quali y ha a e mo e conduci e o
women’s heal h needs.
Job inequali y is no he only a ea in which women a e
disad an aged; hey a e disad an aged in pay as well. Women ea n
as much as 29% less han men in he b oade heal h sec o (Bukha i
e al., 2020). Such dispa i ies can weaken women’s con ibu ion o
economic p ospe i y h ough low labou o ce pa icipa ion and less
human capi al de elopmen , among o he hings.
Aside om hese labou ma ke in luences, women ca y a
disp opo iona e disease bu den in de eloping coun ies (Iye , 2020).
Conside ing he case o HIV, women ha e on a e age, a 60% highe
isk o in ec ion han hei male coun e pa s (Magadi, 2011). Such a
b oad dispa i y wa an s su icien women’s ep esen a ion in he
whole chain o ac o s o p ocu emen mechanism agencies o
ha monise egula ions and s anda ds in he heal h sec o and
implemen d ugs o ensu e e ec i e de elopmen and deli e y o
d ugs on he g ound.
ODI Repo
33
5 Policy ecommenda ions
In he pha maceu ical sec o in A ica, wo key in e es s a e e iden .
Fi s , he e is a desi e o coo dina e he p ocu emen o accines and
o he pha maceu ical p oduc s a he con inen al le el o le e age
cos ad an ages, such as h ough he pooled A ican medicines
p ocu emen mechanism o A ica CDC. This collec i e p ocu emen
e o can sou ce p oduc s ei he wi hin A ica o in e na ionally (UCT-
ODI, 2024). Howe e , limi ed p oduc ion capaci y wi hin he con inen
means p ocu emen is likely o occu p edominan ly om sou ces
ou side A ica. Consequen ly, RoOs play a signi ican ole in in a-
A ican ade pos -p ocu emen . UCT-ODI (2014) con ains a wide
ange o ecommenda ions aimed a de eloping and s eng hening
he pha maceu ical indus y in A ica, using he A CFTA as main
ins umen .
Second, he e is a ocus on os e ing he de elopmen o con inen al
alue chains wi hin he pha maceu ical sec o . Pha maceu ical
sec o s in ol e mul i-s ep p oduc ion p ocesses, including aw
ma e ial sou cing. These p ocesses ha e he po en ial o be localised
wi hin egions, o e ing oppo uni ies o d i e A ica’s indus ial
ans o ma ion unde he A CFTA.
The A CFTA can help acili a e hese wo key objec i es.
Implemen policy measu es o educe he es ic i eness and
associa ed cos s o mee ing RoOs o pha maceu ical p oduc s
while keeping RoOs as is o accine- ela ed ing edien inpu s
and p ima y and seconda y packaging, o p omo e highe
p e e ence u ilisa ion a es and os e he de elopmen o global
alue chains.
The RoOs o pha maceu ical p oduc s unde he A CFTA a e
mode a ely es ic i e. To bene i om he p e e en ial a i a es
p o ided unde he A CFTA, i ms needs o mee hese RoOs, which
in ol e compliance cos s. Pha maceu ical i ms need o decide
whe he o comply wi h RoO egula ions o p e e en ial a i
ea men o op o pay he MFN a i . Gi en ha many A ican
coun ies al eady impose ze o o nea ze o a i s on pha maceu icals
and accines, he p e e en ial a i ma gins p o ided by he A CFTA
a e minimal. Gi en hese low a i a es, he pooled p ocu emen
ini ia i e may emain la gely una ec ed by RoOs. Wai ing he RoO
equi emen o pha maceu ical and accine p oduc s could u he
simpli y p ocu emen .
ODI Repo
34
On he o he hand, RoOs also in luence i ms’ decisions on sou cing
in e media e inpu s and hus he building o pha maceu ical egional
alue chains and manu ac u ing. I RoOs a e highly es ic i e and
cos ly, i ms may sou ce wi hin he A CFTA o quali y o p e e en ial
a i s. Con e sely, lenien RoOs may encou age i ms o sou ce
inpu s om ou side he A CFTA, po en ially hinde ing he
de elopmen o egional alue chains. Manu ac u ing pha maceu ical
and accine p oduc s equi es ing edien s and p ima y and
seconda y packaging. The RoOs o accine ing edien s and p ima y
and seconda y packaging unde he A CFTA a e also mode a ely
es ic i e. Howe e , unlike o pha maceu ical p oduc s, se e al
A ican coun ies ha e highe MFN a i s o accine ing edien s and
p ima y and seconda y packaging. This means he e a e signi ican
p e e en ial a i ma gins i manu ac u e s decide o sou ce inpu s o
p oduce packaging wi hin A ica. This is pa icula ly signi ican o
pha maceu ical global alue chains, whe e inpu s c oss bo de s
mul iple imes. The highe MFN a i s incen i ise pha maceu ical
p oduce s o sou ce inpu s om wi hin he A CFTA o encou age
non-A ican i ms o eloca e o A ica o bene i om p e e en ial
a i s. This could os e local pha maceu ical manu ac u ing in A ica
and he c ea ion o egional alue chains. Head e al. (2021) sugges
ha he ela ionship be ween RoOs and egional p oduc ion
esembles a La e Cu e: RoOs p omo e egional p oduc ion up o a
poin , beyond which i ms p e e paying a i s o e compliance.
The e o e, balancing RoOs and a i s is c ucial o suppo pooled
p ocu emen ini ia i es and he de elopmen o local manu ac u ing
in A ica.
Nego ia e he elaxa ion o he cu en RoOs o pha maceu ical
p oduc s in pooled p ocu emen scena ios o ou line al e na i e
RoOs o p ocedu es o de e mining eligibili y o a i
p e e ences.
This may pe mi he impo a ion o p oduc s wi hou he need o
s ic ly mee he usual RoO equi emen s, acili a ing ade ac oss
bo de s. O he measu es could in ol e elaxing p oduc -speci ic
RoOs o pha maceu icals and mi iga ing compliance cos s ela ed o
adminis a ion and ce i ica ion. Fu he mo e, i may be impo an o
conside sel -ce i ica ion o RoOs. Cu en ly, unde he A CFTA,
RoO ce i ica ion mus be conduc ed by an app o ed expo e o a
designa ed compe en au ho i y o he expo ing s a e pa y. This
p ocess can be bu densome and ime-consuming, especially o
small and medium-sized en e p ises. In oducing sel -ce i ica ion,
which is cu en ly pe mi ed only o consignmen s alued below
$5,000, could signi ican ly alle ia e he cos s associa ed wi h RoOs
o ade s. This would acili a e ade wi hin he A CFTA, p omo e
p e e ence u ilisa ion and suppo he es ablishmen o egional alue
chains.
ODI Repo
35
Ensu e egula o y ha monisa ion o medical s anda ds wi hin
he pha maceu ical ade sec o .
Ano he signi ican aspec h ough which he A CFTA can con ibu e
o he ade o pha maceu ical p oduc s ela es o egula o y
ha monisa ion o medical and pha maceu ical s anda ds. A he
con inen al le el, e o s a e being made o align pha maceu ical and
medical egula ions and coun y-speci ic equi emen s. This is
e lec ed in he S anda ds o Pha maceu ical and Medical De ices in
A ica P ojec , c ea ed in 2020 h ough a pa ne ship be ween
A eximbank, ITFC, BADEA and ARSO. ARSO has al eady
ha monised 113 s anda ds and Technical Regula ion Guidelines,
which ha e been published and dissemina ed o pa ne s and
s akeholde s in he pha maceu ical indus y (ARSO, 2021; Ki home,
2022). Howe e , ha monisa ion o s anda ds and Technical
Regula ion Guidelines o p oduc s unde he b oade ca ego ies
Medical De ices and Equipmen (ARSO TC 78), Pha maceu ical and
Medicinal P oduc s (ARSO TC 80), A ican T adi ional Medicines
(ARSO TC 82) and Technical Regula ion Subcommi ee (ARSO
CACO WG5) is ongoing.
Rapid ha monisa ion o hese p oduc s and obus capaci y-building
e o s o enhance he e ec i eness o hei implemen a ion will be
c ucial o enhancing he p oduc ion and in a-A ican ade o quali y
pha maceu ical p oduc s.
Reduce a i s and non- a i ba ie s on impo ed c i ical
pha maceu ical componen s like APIs o os e he cos -
compe i i eness o p oduce s o c i ical inal heal h p oduc s.
Al hough a common ex e nal a i is equi ed o shield A ican
p oduce s o mee he objec i e o inc easing ade and economic
in eg a ion, his could hampe he g ow h o he pha maceu ical
sec o , owing o he pauci y in p oduc ion capaci y, especially o
APIs. Thus, in he sho o medium e m, i could be economically
bene icial o educe a i s and non- a i ba ie s on impo ed c i ical
pha maceu ical componen s like APIs o os e he cos -
compe i i eness o p oduce s o c i ical inal heal h p oduc s.
Adop capaci y-building measu es o boos he echnical
capaci y o p ocu emen bodies o buye s o imp o e he
e iciency o pooled p ocu emen o se e as a sus ainable
incen i e o he manu ac u ing o heal h p oduc s.
The echnical capaci ies o buye s o p ocu e s will be c ucial o
p omo ing e icien , low-cos p ocu emen o heal h p oduc s. Such
capaci ies, especially in o ecas ing po en ial demand and assessing
heal h p oduc needs o a pa icula demog aphic g oup o
popula ion, and he abili y o assess heal h p oduc a ibu es will be
i al. To his end, boos ing he echnical capaci y o p ocu emen
bodies o buye s will be essen ial in imp o ing he e iciency o
ODI Repo
36
pooled p ocu emen o se e as a sus ainable incen i e o he
manu ac u ing o heal h p oduc s.
In he case o egional p ocu emen agencies, inancial capaci y will
be impe a i e o ensu e a p edic able budge . This will gua an ee he
imely p ocu emen o heal h p oduc s, especially o u gen ly needed
heal h p oduc s like accines du ing imes o heal h c isis.
ODI Repo
37
Re e ences
A ica CDC (2024) ‘A ica CDC spea heads bold mo e o secu e A ica’s heal h
u u e by c ea ing a 50 billion dolla medical ma ke ’. P ess Release, 19
Feb ua y (h ps://a icacdc.o g/news-i em/a ica-cdc-spea heads-bold-mo e-
o-secu e-a icas-heal h- u u e-by-c ea ing-a-50-billion-dolla -medical-
ma ke /).
Anson, J., Cado , O., Es e adeo dal, A., de Melo, J. Suwa-Eisenmann, A. and
Tumu chudu , B. (2005) ‘Rules o o igin in no h–sou h p e e en ial ading
a angemen s wi h an applica ion o NAFTA’ Re iew o In e na ional
Economics 13(3): 501–517.
ARSO (2021) ‘ARSO S anda ds Ha moniza ion Technical Commi ees’.
AU (2018) ‘Ag eemen es ablishing he A ican Con inen al F ee T ade A ea’
(h ps://au.in /si es/de aul / iles/ ea ies/36437- ea y-
consolida ed_ ex _on_c a_-_en.pd ).
AU (2019) ‘T ea y o he A ican Medicines Agency (AMA)’.
h ps://au.in /si es/de aul / iles/ ea ies/36892- ea y-0069_-
_ama_ ea y_e.pd
AU and UNECA (2019) ‘A CFTA: oppo uni ies o pooled p ocu emen o essen ial
d ugs and p oduc s and local pha maceu ical p oduc ion o he con inen ’.
Jus i ica ion (www.uneca.o g/si es/de aul / iles/a c a-pha ma-ini ia i e/a c a-
pha ma-e en -2019/one_page _jus i ica ion_eng.pd ).
Benne , D. and Yin, W. (2019) ‘The ma ke o high-quali y medicine: e ail chain
en y and d ug quali y in India’ The Re iew o Economics and S a is ics
101(1): 76–90.
Bigna, J.J. and Noubiap, J.J. (2019) ‘‘The ising bu den o non-communicable
diseases in sub-Saha an A ica’ The Lance Global Heal h 7(10): e1295–96.
Bukha i, N., Manzoo , M., Rasheed, H., Nayye , B. e al. (2020) ‘A S ep owa ds
gende equi y o s eng hen he pha maceu ical wo k o ce du ing COVID-19’
Jou nal o Pha maceu ical Policy and P ac ice 13(1): 15.
Cado , O., Ca è e, C., de Melo, J. and Tumu chudu , B. (2006) ‘P oduc -speci ic
ules o o igin in EU and US p e e en ial ading a angemen s: an
assessmen ’ Wo ld T ade Re iew 5(2): 199–224.
Conway, M., Hol , T., Sabow, A. and Sun, I.Y. (2019) ‘Should sub-Saha an A ica
make i s own d ugs?’ McKinsey & Company, 10 Janua y.
www.mckinsey.com/indus ies/public-sec o /ou -insigh s/should-sub-
saha an-a ica-make-i s-own-d ugs
De elopmen Reimagined (2022) ‘Making A ica’s pha maceu ical ambi ions a
eali y: pa 1 – his o y, ade and hubs’ (h ps://de elopmen eimagine.b-
cdn.ne /wp-con en /uploads/2022/08/a _pha m_ epo _ inal-
_ o ma _oo_29jul.pd ).
ODI Repo
38
Dubois, P., Le ouili, Y. and S aub, S. (2021) ‘Pooled p ocu emen o d ugs in low-
and middle-income coun ies’ Eu opean Economic Re iew 132(4): 103655.
Espín, J., Ro i a, J., Calleja, A., Azzopa di-Musca , N., Richa dson, E., Palm, W., &
Pan eli, D. (2016). How can olun a y c oss-bo de collabo a ion in public
p ocu emen imp o e access o heal h echnologies in Eu ope. Heal h
sys ems and policy analysis, policy b ie , 21.
Es e adeo dal, A. (2000) ‘Nego ia ing p e e en ial ma ke access: he case o he
No h Ame ican F ee T ade Ag eemen ’ Jou nal o Wo ld T ade 34(1): 141–
166.
Fle che , E.R. (2024) ‘A ica CDC announces pooled medicines p ocu emen a AU
Summi ; leade s called upon o expedi e A ican medicines agency se -up’.
A ican Medicines Agency, 19 Feb ua y (h ps://heal hpolicy-
wa ch.news/a ica-cdc-announces-pooled-medicines-p ocu emen -a -au-
summi -leade s-called-upon- o-expedi e-a ican-medicines-agency-se -up/).
Go e nmen o Bo swana (2021) ‘Lea ning om global, egional and coun y
expe iences: Bo swana pooled p ocu emen epo ’. Gabo one: Minis y o
Heal h and Wellness (h ps://pd .usaid.go /pd _docs/PA00XVFW.pd ).
Head, K., Maye , T., & Meli z, M. (2024). The La e cu e o ules o
o igin. Jou nal o In e na ional Economics, 103911.
Hu -Rousselle, M. and Bu ne , F. (1996) ‘Cos con ainmen h ough
pha maceu ical p ocu emen : a Ca ibbean case s udy’ The In e na ional
Jou nal o Heal h Planning and Managemen 11(2): 135–157.
Iye , J. (2020) ‘F om he boa d oom o he consul ing oom, we need women in
pha ma’. WEF, 6 Ma ch (www.we o um.o g/agenda/2020/03/pha ma-
heal hca e-cu ing-gende -bias/).
Ki home, D. (2022) ‘A eximbank, ITFC, BADEA and ARSO lead ha monisa ion o
A ican s anda ds o acili a e in a-A ican ade in pha maceu icals and
medical de ices’. ARSO, 7 No embe (www.a so-o an.o g/?p=7674).
Lakdawalla, D.N. (2018) ‘Economics o he pha maceu ical indus y’ Jou nal o
Economic Li e a u e 56(2): 397–449.
Magadi, Monica Akinyi. 2011. ‘Unde s anding he Gende Dispa i y in HIV In ec ion
ac oss Coun ies in Sub-Saha an A ica: E idence om he Demog aphic
and Heal h Su eys’. Sociology o Heal h & Illness 33(4): 522–39.
doi:10.1111/j.1467-9566.2010.01304.x.
McKinsey & Company (2015) ‘Insigh s in o pha maceu icals and medical p oduc s
A ica: a con inen o oppo uni y o pha ma and pa ien s’.
(www.mckinsey.com/~/media/mckinsey/indus ies/li e%20sciences/ou %20in
sigh s/a ica%20a%20con inen %20o %20oppo uni y%20 o %20pha ma%2
0and%20pa ien s/pmp%20a ica%20a%20con inen %20o %20oppo uni y%
20 o %20pha ma.pd ).
Mo a i, M., Nikiema, J, Kasilo, O., Kniazko , S. e al. (2021) ‘The ole o in ellec ual
p ope y igh s on access o medicines in he WHO A ican Region: 25 yea s
a e he TRIPS Ag eemen ’ BMC Public Heal h 21(1): 490.
Nakkazi, E. (2021) ‘A made-in-a ica mala ia accine’ Na u e A ica, 30 June ().
Na ayan, K. (2016) ‘En isioning a heal hy u u e – A ica’s shi ing bu den o
disease’. Ins i u e o Secu i y S udies Pape s 18: 1–36.
ODI Repo
39
Nemzo , C., Chalkidou, K., & O e , M. (2019). Agg ega ing demand o
pha maceu icals is appealing, bu pooling is no a panacea. Cen e o
Global De elopmen .
Ndomondo-Sigonda, M., Mio , J., Naidoo, S., Maso a, N. e al. (2021)
‘Ha moniza ion o medical p oduc s egula ion: a key ac o o imp o ing
egula o y capaci y in he Eas A ican Communi y’ BMC Public Heal h 21(1):
187.
Pa maksiz, K., Pisani, E., Bal, R. and Kok, M.O. (2022) ‘A sys ema ic e iew o
pooled p ocu emen o medicines and accines: iden i ying elemen s o
success’ Globaliza ion and Heal h 18(1): 59.
Pheage, T. (2017) ‘Dying om lack o medicines’ A ica Renewal 30 (3): 24–25.
Pichle , P.P., Jacca d, I.S., Weisz, U. and Weisz, H. (2019) ‘In e na ional
compa ison o heal h ca e ca bon oo p in s’ En i onmen al Resea ch Le e s
14(6): 064004.
SADC (2011). S a egy o Pooled P ocu emen o Essen ial Medicines and Heal h
Commodi ies, 2013-201. h ps://www.sadc.in /si es/de aul / iles/2021-
08/SADC_S a egy_ o _Pooled_P ocu emen _o _Essen ial_Medicines_and_
Heal h.pd
SADC (2018) ‘SADC, Tanzania discuss SADC Pooled P ocu emen o
Pha maceu icals Se ices’. 27 Sep embe (www.sadc.in /la es -news/sadc-
anzania-discuss-sadc-pooled-p ocu emen -pha maceu icals-se ices).
SADC (2024) ‘SADC Med Da abase (SMD) applica ion launch upda e’.
(www.sadc.in /si es/de aul / iles/2024-
05/SADC%20Med%20Da abase%20%28SMD%29%20Applica ion%20launc
h%20Upda e%202024-04-29.pd ).
Sidibé, M., Li, Y. and Chan, M. (2014) ‘Commodi ies o be e heal h in A ica –
ime o in es locally’ Bulle in o he Wo ld Heal h O ganiza ion 92(6): 387–
387A.
Tsighe, M. (2019) ‘Can he dispu e se lemen mechanism be a c own jewel o he
A ican Con inen al F ee T ade A ea?’ Symposium Pos s, 8 Ap il
(www.a onomicslaw.o g/2019/04/08/can- he-dispu e-se lemen -
mechanism-be-a-c own-jewel-o - he-a ican-con inen al- ee- ade-a ea).
UCT-ODI (2024) ‘A ican Pha maceu ical Sec o Landscape Analysis: Focus on
Pha maceu ical manu ac u ing and ade unde he A CFTA’, Repo
UNECA (2020) ‘Iden i ying p io i y p oduc s and alue chains o s anda ds
ha moniza ion in A ica’. Technical S udy. Addis Ababa: UNECA
(h ps:// eposi o y.uneca.o g/handle/10855/43813).
UNECA (2022) ‘Showcasing he A CFTA-Ancho ed Pha maceu ical Ini ia i e:
lessons and expe iences’. Concep No e o he High-Le el Poli ical Fo um
on Sus ainable De elopmen Side E en .
h ps://hlp .un.o g/si es/de aul / iles/documen s/2022/Concep %20No e%20
%20-%20Pha ma%20Ini ia i e%20Side%20E en _0.pd
UNECA (2023a) ‘F amewo k o implemen ing cen alized pooled p ocu emen in
10 pilo coun ies’. Addis Ababa: UNECA.
h ps://hdl.handle.ne /10855/49878
UNECA (2023b) ‘Deepening he A CFTA: celeb a ing he adop ion o new p o ocols
on in es men , in ellec ual p ope y igh s and compe i ion policy’. Blog, 16
Ma ch (h ps://uneca.o g/s o ies/%28blog%29-deepening- he-a c a-
celeb a ing- he-adop ion-o -new-p o ocols-on-in es men %2C).
ODI Repo
40
Ussai, S., Chillo i, C., S ochino, E., Deidda, A. e al. (2022) ‘Building he
momen um o a s onge pha maceu ical sys em in A ica’ In e na ional
Jou nal o En i onmen al Resea ch and Public Heal h 19(6)
(h ps://doi.o g/10.3390/ije ph19063313).
Wa ula, F., Agweyu, A. and Macin y e, K. (2013) ‘Regional and empo al ends in
mala ia commodi y cos s: an analysis o Global Fund da a o 79 coun ies’
Mala ia Jou nal 12(1): 466.
Wa ula, F., Agweyu, A. and Macin y e, K. (2014) ‘T ends in p ocu emen cos s o
HIV commodi ies: a 7-yea e ospec i e analysis o Global Fund da a ac oss
125 coun ies’ Jou nal o Acqui ed Immune De iciency Synd omes 65(4):
e134–39.
