Technocrats in the Ministry of Health and the National Treasury are considering to review commercial viability of establishing a multi-billion Covid-19 plant days after South African firm, Aspen Pharmacare announced possibility to close down Africa’s first vaccine plant associated with Johnson & Johnson.
According to insiders, they fear lack of orders would render the factory commercially unviable and could hence shelve the project altogether.
Plans to set up the vaccine plant in the country had a false start after the National Assembly slashed the budget set aside for building the factory by Sh500 million.
This is after the Budget and Appropriations Committee (BAC) backed the Health Committee’s recommendation to slash the Sh900 million seed capital that the Treasury allocated for a vaccine manufacturing plant in the mini-budget.
The Health Committee had proposed a cut of Sh400 million but the BAC enhanced it to Sh500 million.
The factory is earmarked to cost taxpayers Sh60billion which will produce vaccines in the country including Covid-19 vaccine.
An American biotechnology firm Moderna was picked to set up a manufacturing facility in the country to produce messenger RNA (mRNA) vaccines, including Covid-19 shots.
Kenya had in January invited firms through a global tender to bid for the construction of a Covid-19 vaccine plant the Kenya BioVax Institute, a State-owned commercial and manufacturing firm.
“Reduce Sh500 million (development) from establishment of vaccine plant. The committee (Health) had reduced the same project by Sh400 million,” the committee said in a report on the Supplementary Budget I for 2021/22 financial year.
BAC did not provide reasons advanced by the Health committee to justify the huge cut on the budget for construction of the Covid-19 manufacturing plant.
And in South Africa, Aspen Pharmacare executive said they are considering closing down after getting no orders.
In November last year, Aspen Pharmacare in South Africa agreed to package and market Johnson & Johnson’s Covid-19 vaccine and distribute it across Africa under a licensing agreement.
The World Health Organisation (WHO) hailed the agreement as a “transformative moment” in the fight to eliminate severe disparities in Covid vaccination access.
According to the most recent WHO numbers from the end of March, barely a sixth of adults in Africa are completely vaccinated, making Aspen’s agreement to market an Aspen-branded Covid-19 vaccine, Aspenovax, throughout Africa a sure bet.
A fifth wave of illnesses is expected in South Africa, which has vaccinated 30 per cent of its population.
“No orders for Aspenovax have been received,” Aspen senior director Stavros Nicolaou told Reuters over the phone.
“If we don’t get any kind of vaccine orders, then clearly there’ll be very little rationale for retaining the lines that we’re currently using for production,” he said of the Covid-19 vaccine plant in Gqeberha, Eastern Cape.
Africa has been faced with logistical obstacles, a shortage of competent personnel, cold chains, and other issues related to vaccine distribution.
Another difficulty is that, after originally abandoning Africa, donor countries have recently paid up, ensuring that the continent is well-supplied.
Nicolaou stated that the company’s long-term goal was to convert to producing other vaccines, but that the company had relied on these early volumes to purchase time to set up shop.
The African Union’s goal is to produce 60 percent of all vaccines delivered in Africa domestically by 2040, up from 1 percentage currently, and several such plants are currently under construction.
In March this year, Moderna signed an agreement with Kenya to set up its manufacturing plant in the country, the first in Africa.
The announcement was made by Health Principal Secretary Susan Mochache.
President Uhuru Kenyatta said Kenya is “pleased to partner with Moderna in the establishment of this mRNA manufacturing facility to help prepare the country and our sister states on the continent through the African Union to respond to future health crises and stave off the next pandemic.”
Kenyatta said the partnership is a testament to the capabilities of “our community and our commitment to technological innovation. Moderna’s investment in Kenya will help advance equitable global vaccine access and is emblematic of the structural developments that will enable Africa to become an engine of sustainable global growth.”
Noubar Afeyan, Co-founder and Chairman of Moderna said, “We would like to thank the Government of the Republic of Kenya for their support in bringing our mRNA manufacturing facility to Kenya. We would also like to thank the U.S. Government for assisting us in this process. We are honored to have played such a critical role in combatting the COVID-19 pandemic with our vaccine and we are determined to expand our global impact with our first manufacturing facility on the continent of Africa.”