Approximately 20% of Uganda's 37.6 million inhabitants live below the national poverty line and the average GNI per capita is USD 600. Chronic political instability and inconsistent economic management has left Uganda among the world's poorest and least-developed countries.
Uganda's labor force is growing more than 4% per annum, equaling more than 500,000 people entering the labor market every year. This growth presents the need to develop local productive industries, such as pharmaceutics, which includes the challenge of finding and/or training local workers for the skills required in these industries. Overall this increases the amount of local good jobs available for the growing labor market.
The local pharmaceutical industry has developed significantly over the last 10 years, however Uganda continues to face challenges such as a sizeable counterfeiting industry, poor healthcare funding, corruption, and regulatory environment deficiencies, and still relies on imports for 90% of its essential medicines and health supplies.
With only 10% of medicines and health supplies produced locally, there is an immense potential for the expansion of the domestic manufacturing sector, including an increase of local jobs and taxes paid, as well as an enhanced availability of the manufactured medicines as the supply grows and prices drop.
The manufacture and operation process for pharmaceuticals is very sophisticated. Highest quality standards have to be guaranteed during every step of the production. Access to capital for expansion and modernization in the region is very limited, and is traditionally non-existent for risky sectors such as pharmaceuticals.
Development Effects in a nutshell
Since its beginning, APDL has maintained a strong quality and compliance record. Maximum standards of hygiene and quality control are ensured throughout the entire manufacturing facility, contributing to the improvement of standards and implementation of best-practice methods across the whole industry.
• APDL expanded its capacity by creating a new production line and constructing a new facility located on 36 acres outside Kampala using capital from AfricInvest II and its holding company, Kiboko. The new plant has the capacity to produce 65 million units of parenteral drugs per year, enabling it to produce intravenous (IV) fluids and sterile ear and eye drops for Uganda, Tanzania, Burundi, Rwanda, South Sudan and Kenya.
• Local production of IV fluids by APDL caused a reduction in the wholesale price by 30% in the first five months of production. This indicates that the local industry has the potential to significantly lower the price of medicines and thereby facilitate accessibility of these vital products to a market suffering from poor healthcare availability and standards.
• APDL is strongly committed to sustainable production and operation standards and promotes the use of environmentally-friendly processes and raw materials. For example, the manufacturing facility was designed to be completely illuminated by daylight to reduce the reliance on electric lighting and APDL has installed a plastic granules recycling plant, alleviating raw material shortages and reducing costs. Additionally, APDL has replaced furnace oil boilers with environmentally-friendly biomass boilers which burn abundantly available coffee husks, saving on fuel costs while recycling a local waste product.
APDL’s corporate social responsibility (CSR) activities include ascholarship program via its holding company, Kiboko, which annuallyprovides five students from low-income backgrounds with full board,tuition fees and other expenses to obtain a Bachelor of Pharmacy at alocal university.
Obviam has made reasonable efforts to ensure the accuracy of the data presented. A case study is made possible both through Obviam’s first-hand experience and/or the information provided by Obviam’s investment partners. Data is valid as per the date recorded.