State-backed vaccine manufacturer Biovac has clinched a deal with a consortium of development finance institutions to raise $150m (R2.3bn) to fund the expansion of its Cape Town-based facility, to produce up to 1-billion doses a year.
It bolsters SA’s plans to increase its domestic vaccine production capacity, and reduce the risk of standing at the back of the queue again in future health emergencies.
Vaccine manufacturing is heavily concentrated in a handful of wealthy countries and India, leaving Africa virtually entirely reliant on imports. The lack of local production has contributed to the slow rollout of Covid-19 vaccines in Africa, where the majority of people have yet to have their first shot even as some wealthier countries offer third or fourth jabs to their citizens.
Biovac has been contracted by Pfizer to bottle up to 100-million doses a year of its Covid-19 vaccine, with the first shots due to come off its production line in the third quarter of 2022, and already helps produce smaller volumes of routine childhood vaccines for Pfizer and Sanofi.
However its production facilities currently only have capacity to make 120-m doses a year, according to Biovac CEO Morena Makhoana. Negotiations are under way with authorities from the City of Cape Town and Western Cape province to expand into land adjacent to Biovac's current Pinelands site, in two phases, with the first stage taking annual production up to 500-million doses a year, he said.
The consortium partners include the African Development Bank, the UK’s development finance institution CDC, the German development finance institution DEG, the US International Development Finance Corporation (DFC), the European Investment Bank (EIB), the EU delegation to SA, the International Finance Corporation (IFC), the Industrial Development Corporation of SA (IDC), and the French development finance institution Proparco.
“Covid-19 has proven that a more geographical spread of vaccine manufacturing is much needed globally, with the African continent having the least number of vaccine manufacturers. We are pleased that the consortium of funders is willing to work with Biovac to create sustainable African vaccine manufacturing, not only to respond to the current pandemic, but also to much needed routine vaccines and future pandemic vaccines as well,” said Biovac CFO Craig Mitchell.
African Development Bank Group president Akinwumi A Adesina said the coronavirus pandemic was a wake-up call that Africa could not outsource the health of its people to other continents or rely on global supply chains.
DFC CEO Scott said the project advanced US President Biden’s “Build Back Better World Initiative” by bolstering global health infrastructure. “Supporting the global community’s continued response to the Covid-19 pandemic and strengthening health systems in developing countries are top priorities for DFC,” he said.
Makhoana declined to elaborate on Biovac’s plans to make additional vaccines, saying only that further announcements could be expected later in 2022.
Biovac and the consortium did not provide details of the financing structure.
The IFC said a range of financing instruments were being explored and more details would be provided at a later stage.
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