DEG invests EUR 100 million in African pharmaceutical production

South African pharmaceutical company Aspen Pharmacare Holdings Limited is to receive a loan package worth EUR 500 million to expand local production capacities and improve access to essential pharmaceuticals throughout Africa. DEG is contributing EUR 100 million to this. The aim is to significantly step up the regional production of life-saving medication, including insulin and paediatric vaccines. During the COVID pandemic in 2021, DEG had already participated – together with several other development finance providers – in financing a loan for the company, arranging a total of EUR 144 million.

Aspen’s strategy, ‘Manufacturing in Africa for Africa’, aims to improve access to medication and to make it affordable by producing it locally and entering into strategic partnerships with other pharmaceutical firms. The company is expanding its production capacities and wants to be in a position to manufacture a wider spectrum of vital pharmaceuticals on location in future. This will reduce dependence on imports and increase security of supply in Africa.

As Stephen Saad, Chief Executive of the Aspen Group, explains: “A key part of Aspen’s identity is being instrumental in building up the African healthcare system. Thanks to the support from our financing partners, we can now further expand our capacity in Africa, which in turn allows us to contribute to the independence and dignity of the continent as a whole.”

International cooperation for better medical care

The current loan package is made available jointly by IFC, the US agency DFC, French development financing institution Proparco and DEG.

Monika Beck, member of the DEG Management Board, stresses the importance of this involvement: “DEG strives to meet the Sustainable Development Goals (SDGs) drawn up by the United Nations, and improving healthcare is one of these. Facilitating access to high-quality and innovative pharmaceuticals is vital for the health and well-being of people in Africa – and the private sector plays a key role here.”

Expanding local production capacities not only improves security of supply but also creates many new jobs. This investment helps to strengthen the regional economy and to develop local markets. In the long term, this initiative aims to make the healthcare sector in Africa more resilient and to improve medical care for the general public. In this way, the project works towards several sustainable development goals at the same time.

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