Aspen secures $30m for African childhood vaccines

SA’s largest pharmaceutical manufacturer Aspen Pharmacare has secured $30m from the Bill & Melinda Gates Foundation (BMGF) and the Coalition for Epidemic Preparedness Innovations (CEPI) to support its plan to make childhood vaccines for Africa, it announced on Monday.

Aspen secured a 10-year agreement with the Serum Institute of India (SII) in August, to bottle four vaccines used in childhood immunisation programmes, which it will market and distribute under its own brand in Africa. The agreement is aimed at using spare capacity in Aspen’s sterile plant in Gqeberha, which has lines lying idle due to slower than expected demand for Covid-19 shots, and reducing Africa’s reliance on vaccine imports, which leave it vulnerable in times of scarcity. Africa imports 99% of its vaccines, and was left at the back of the queue when Covid-19 vaccines were in short supply in the early stages of the coronavirus pandemic.

Aspen CEO Stephen Saad said the funding from the BMGF and CEPI, which each put in $15m to support its partnership with the SII, was an important step in ensuring expanded and enduring access to a pipeline of products that were made in Africa, for Africans. “This support will ensure we can continue to invest and expand our capacities, secure in the knowledge of future offtakes,” he said, referring to a crucial aspect of the SII deal announced in August, which will see the vaccines purchased by multilateral organisations in addition to AU member states.

Vaccines included in the deal with SII are used in childhood immunisation programmes all over Africa. They include vaccines against pneumococcal disease and rotavirus, as well as a polyvalent meningitis jab and a six-in-one hexavalent vaccine that protects babies against diphtheria, tetanus, whooping cough, polio, Hemophilus influenza type B and hepatitis B.

The terms of the deal include a technical transfer and  formulation fill-and-finish arrangement, which grants Aspen the rights to manufacture the products from bulk drug substance supplied by SII.

Sasfin senior equity analyst Alec Abraham said Aspen’s agreement with the SII could be “quite significant” for the company, given that it had existing vaccine manufacturing capacity.

Aspen reached an agreement last year to bottle Johnson & Johnson’s Covid-19 shot, and then extended the deal to produce the jab under its own brand, Aspenovax, but it has seen dwindling demand from J&J and received no orders for its own-brand jab.

Aspens’ share price rose as much as 2% to reach an intraday high of R143.89, before closing at R140.55.

kahnt@businesslive.co.za