Kenya was recognized as one of the fastest growing countries in the world with a macroeconomic growth between 5-10%, this is according to the 2016-2017 COMESA Biennial report. Kenya has become a business hub in East African resulting in diverse investments from foreign companies keen to penetrate the lucrative markets in the region. The Pharmaceutical Industry is no exception.
Statistics indicate that Kenya is the largest pharmaceutical market in the EAC, with a market size worth USD$740 million in 2014. Consequently, the country has established herself as an East African hub for the multinational pharmaceutical corporations, hosting numerous multinational companies in Middle Africa region.
The entry of the world’s Top 10 pharmaceutical companies (combined estimated revenue of USD330 Billion in 2017) in Kenya through company representations, local affiliates and their distributors buttresses Kenya’s attractiveness as an investment hub.
However, there has been a long-running debate on the merits and demerits of the multinationals and their impact to the host country. From the Kenyan perspective, they offer benefits such as: Foreign Direct Investment, creating a source of tax revenue for the government, the direct flow of capital improves the balance of payments which result in export promotions and import substitutions as more Kenyans benefit from high quality innovator products including specialised biological products, vaccines and orphan drugs.
The multinational companies, through their local affiliates, also invest heavily in building capacity, offering employment benefits with a plethora of skills transferred to the host country. Other benefits include increased competitiveness in the pharma industry resulting in more competitive prices for the consumers. Technology transfer also means Kenya benefits from the many years of Research and Development already done by the multinational companies.
On the other hand, critics decry the unmonitored influence these companies have on the country. But from a pharmaceutical industry’s perspective, the companies’ influence has been positive by supporting the development of International Pharmaceutical Standards/guidelines and Policies. Other concerns include; uncertainties with evolving business strategies, transfer pricing and export of profits.
Additionally, there have been concerns on environmental, health, safety and substandard activities in the host country. However, this is mitigated by the fact that the Pharmaceutical Industry is a highly regulated Industry.
There are strict regulations by the Pharmacy and Poisons Board (PPB) and the International Standards which the pharmaceutical companies abide to, as well the Ethical Code of Practice from Kenya Association of Pharmaceutical Industry (KAPI), which brings together these innovator companies and their local affiliates. KAPI’s mission is to promote an ethical, innovative and responsible health care industry.
We cannot discuss merits without acknowledging the Corporate Social Responsibility that the pharmaceutical industry through these multinationals and their local affiliates have done and continue to do for the betterment of the Kenyan society.
For example, Merck, Pfizer, GSK and Johnson & Johnson have collectively donated significant amounts of drugs towards the Neglected Tropical Disease control programme. Pfizer embarked on the Mobilize Against Malaria programme to address the gap in malaria treatment in Kenya, Ghana and Malawi. Sanofi created a Foundation, which focuses on three major objectives: controlling childhood cancer, fighting maternal and child mortality, and ensuring access to healthcare for the world’s poorest populations.
In May 2013, GSK and Save the Children Fund embarked on a partnership to save one million children’s lives. The focus of the partnership was widening vaccination coverage, researching on new low-cost products to combat malnutrition, and increasing investment in training and upskilling of health workers.
The Novartis Access Program offers a portfolio of 15 on and off-patent medicines addressing key Non-Communicable Diseases (NCDs), cardiovascular diseases, Type 2 diabetes, respiratory illnesses and breast cancer. Under the deal, the Government of Kenya pays of 1USD per treatment per month.
Reckitt Benckiser, through the Dettol initiative continues to work in communities across the globe and with partners to deliver hygiene education. Recently, Takeda announced the implementation of Seed Global Health programme worth 500 million Japanese Yen for training health professions in Sub Sahara Africa.
UNICEF through Gavi the Vaccine Alliance, has partnered with some of these Multinational Pharmaceutical Companies to successfully provide access of life saving vaccinations to children in the low-income countries.
From the above examples, of the merits and demerits of this debate on the impact of multinational pharmaceutical show that the pros outweigh the cons. With Universal Health Coverage being one of the four pillars being pursued by the Government, it is increasingly evident that, it would be in Kenya’s best interest to exploit the opportunities offered through the Private Public Partnership umbrella and build more on the relations with the ever-growing pharmaceutical sector.
Dr Winnie Mwangi is the Kenya Association of Pharmaceutical Industry (KAPI) Executive Secretary and Public Relations lead. Email: Nimonganga1@gmail.com