We are pleased to announce to the media a joint venture between the South African government through Pelchem (Pty) Ltd and a leading global pharmaceutical company Lonza Ltd. We agreed to make the announcement today following the Cabinet decision because the international partners are visiting South Africa at the moment
This joint venture named “Ketlaphela”, will establish the first pharmaceutical plant to manufacture Active Pharmaceutical Ingredients (APIs) for Anti-Retroviral Medicines (ARV’s) in South Africa. “Ketlaphela” is a Sesotho word meaning “I will live or survive”.
The new pharmaceutical company will be created in partnership with the Swiss company Lonza and the South African state-owned company Pelchem (Pty) Ltd, a subsidiary of the Nuclear Energy Corporation (NECSA). The new company will be funded by a capital investment of R1-billion by various state institutions including the Industrial Development Corporation; more than 500–million Rand from Lonza; and R100-million from Pelchem/NECSA in land and infrastructure. The total investment is R1,6 billion for the project.
Ketlaphela will be a truly South African company with a significant government ownership component through Pelchem and the IDC. The South African state-owned company Pelchem is a leading speciality chemical manufacturer, and is the sole producer of flourochemicals on the African continent. Pelchem plays a leading role in South Africa’s flourochemical expansion inititiative in partnership with the departments of Trade and Industry and Science and Technology.
The Flourochemical Expansion Initiative (FEI) is an attempt to increase beneficiation of South African mined fluorspar to counter the trade deficit in chemical products. The reason for the FEI is because South Africa holds the second largest fluorspar reserves in the world outside China and is an important international supplier of fluorspar to hydrogen fluoride producers. Pelchem is the only compoany in South Africa that beneficiates a small percentage of locally mined fluorspar into higher value fluorochemical products and therefore plays a leading role in the FEI.
Our partnership with Lonza is based on the fact that Lonza is one of the world’s leading suppliers of various products of pharmaceutical, healthcare and life sciences industries and is a global leader in the production and support of API’s, in cell-based research, endotoxin detection and cell therapy manufacturing. Lonza’s high Swiss standards plus their superb track record of establishing and maintaining successful commercial operations in developing countries, make them a valuable and highly desirable partner.
This initiative is a joint initiative by the departments of Science and Technology, Trade and Industry, Health, and Economic Development and will firstly address the burden of communicable diseases such as HIV and Aids, Tuberculosis and Malaria and later on non-communicable diseases such as diabetes, hypertension and cancer.
The project is in line with plans of the South African government to address HIV and AIDS through the local and cost effective production of antiretroviral drugs. Ketlaphela will leapfrog South Africa into the 21st century as far as local pharmaceutical manufacturing is concerned. It will also provide new opportunities for South African scientists and pharmaceutical companies.
Ketlaphela will reduce the country’s dependence on imported drugs and will provide security of supply of priority drugs, stable pricing with less sensitivity to exchange. The consortium has entered into negotiations with the South African government with the aim of delivering the first fully South African manufactured ARVs from 2016 onwards. While most of the medicines used in our current ARV treatment regiment are manufactured by local pharmaceutical companies – currently, four South African companies are capable of formulating generic ARVs – all APIs are imported. APIs account for 50% to 75% of production of generic ARV in the finished-dosage form.
The new facility will be built at the Pelindaba site of NECSA/Pelchem in Gauteng and will be a massive boost to the local pharmaceutical industry, creating an estimated 2200 jobs in the process. These jobs will include direct and indirect jobs in both the formal and informal sector of the economy. An estimated 3800 jobs will be created during the construction phase.
An interdepartmental task team comprising the Departments of Science and Technology, Trade and Industry, Economic Development, Health, and Energy has been established to negotiate the modalities and incentives necessary to ensure the financial viability of the Ketlaphela project, under the guidance of Minister Naledi Pandor, Minister of Science and Technology.
The Ketlaphela project will contribute to meeting the objectives of the Department of Trade and Industry’s Industrial Policy Action Plan (IPAP), which includes diversifying the South African economy towards higher value-added manufacturing, creating jobs, especially quality & knowledge-related jobs and thus controlling the trade balance. IPAP has identified the pharmaceutical industry among the “priority sectors”, highlighting the economic and strategic importance of domestic manufacture of antiretrovirals (ARVs) and active pharmaceutical ingredients (APIs). The Department of Trade and Industry will assist the project through various economic incentives to promote local manufacturing.
Ladies and gentlemen, the South African government is very excited by the potential of this joint venture and is looking forward to providing South African solutions to our health needs.
Enquiries:
Dominik Werner
Tel: +41 61 316 8798
E-mail: dominik.werner@lonza.com
Tommy Makhode
Tel: 021 469 5019
Cell: 082 379 8268
E-mail: tommy.makhode@dst.gov.za
Sidwell Medupe
Tel: 012 394 1650
Cell: 079 492 1774
E-mail: MSMedupe@thedti.gov.za
Saleem Mowzer
Cell: 082 808 8135
Notes to Editors
About IDC
Established in 1940, the IDC is a national development finance institution set up to promote economic growth and industrial development, wholly owned by the South African government under the supervision of the Economic Development department. Visit us on www.idc.co.za
About Pelchem
Pelchem is a 100% subsidiary company of the South African Nuclear Energy Corporation (Necsa) with a business focus on the fluorochemical industry. It plays a strategic role in supporting Necsa and government plans for a nuclear fuel programme in the country.
South Africa holds the second largest fluorspar reserves in the world outside China and is an important international supplier of fluorspar to hydrogen fluoride producers. The South African chemical sector development strategy includes a priority programme, the Fluorochemical Expansion Initiative (FEI), to increase beneficiation of South African mined fluorspar to counter the trade deficit in chemical products. Pelchem is the only company in South Africa that beneficiates a small percentage of locally mined fluorspar into higher value fluorochemical products and therefore plays a leading role in the FEI.
Pelchem manufactures and markets anhydrous hydrogen fluoride (AHF), hydrofluoric acid, fluoride containing salts, fluorine gas, and specialityfluoride containing gases and fluoro-organic monomers to local industry and to selected international customers. These products are used in the petroleum, pharmaceutical, glass, electricity, metallurgical, mining, polymer, agrochemical, electronics, construction, aluminium and detergent industries.
Consumers benefit daily from products which are manufactured, processed or enhanced using fluoride containing chemicals. These include high octane fuel; anaesthetics; metered dose inhalers; polished crystal glasses; frosted glass; electrical insulators; foam insulation and packaging materials; special alloys in aircraft and turbines; telephones; cell phones; diamonds; domestic and industrial refrigeration; non-stick cookware; plastic components in automotive applications; electrical cable insulation; beverage cans; pesticides and herbicides in agriculture; microchips for domestic appliances and computers; memory chips in computers, iPods, flash memory sticks; liquid crystal displays (LCD) on electronic components and LCD televisions; cement; alloy wheels; gaming devices; automotive safety devices (airbags); aluminium foils; designer stainless steel kitchen ware; stainless steel automotive components; soaps and washing powders; fluoride toothpaste, fluoride tablets and fluoride dental treatment.
About Lonza
Lonza is one of the world's leading suppliers to the pharmaceutical, healthcare and life science industries. Products and services span its customers’ needs from research to final product manufacture. It is the global leader in the production and support of active pharmaceutical ingredients both chemically as well as biotechnologically. Biopharmaceuticals are one of the key growth drivers of the pharmaceutical and biotechnology industries. Lonza has strong capabilities in large and small molecules, peptides, amino acids and niche bioproducts which play an important role in the development of novel medicines and healthcare products. Lonza is also the world leader in microbial control providing innovative, chemistry-based and related solutions to destroy or to selectively inhibit the growth of harmful microorganisms. Its activities encompass the areas of water treatment, personal care, health and hygiene, industrial preservation, materials protection, and wood treatment. In addition, Lonza is a leader in cell-based research, endotoxin detection and cell therapy manufacturing. Furthermore, the company is a leading provider of value chemical and biotech ingredients to the nutrition and agro markets.
Lonza is headquartered in Basel, Switzerland and is listed on the SIX Swiss Exchange and secondary listed on the Singapore Exchange Securities Trading Limited (“SGX-ST”). Lonza is not subject to the SGX-ST’s continuing listing requirements. Lonza is subject to the listing rules of the SIX Swiss Exchange, which do not have specific requirements equivalent to the listing rules of the SGX-ST in respect of interested person transactions, acquisition and realisations, and delisting. In 2011, the company had sales of CHF 2.69 billion. Further information can be found at www.lonza.com.
Media statement by the South African government on the establishment of a pharmaceutical manufacturing plant in South Africa
