Barrs Pharmaceuticals has exited business rescue and sold a controlling stake in its business to the South African subsidiary of Indian generic drug manufacturer Hetero, it emerged on Monday.
Hetero South Africa will acquire 78% of the shares in Barrs for R92m, according to business rescue consultant Karl Gribnitz.
The company will also step in to cover Barrs’ share of the government’s latest Aids drug tender, which it has been unable to fulfil.
Business Day reported last month that Barrs and its sister company, Innovata Pharmaceuticals, which each won a share of the contracts to supply the three-in-one pill taken by most HIV patients, went into business rescue in December.
Both companies are subsidiaries of Avacare, which also went into business rescue at the time. Avacare and all its subsidiaries have now exited business rescue, according to Gribnitz.
“Outstanding [Aids drug] stocks will be delivered on or before February 10,” he said.
The health department has granted approval for Barrs to supply Hetero South Africa’s products at the price set out in the tender award, said department spokesperson Foster Mohale.
The development marks an uptick in the fortunes of Hetero South Africa, which launched legal action against the health department for excluding it from the R12.6bn tender to supply monthly and three-month packs of the triple pill combining tenofovir, lamivudine and dolutegravir (TLD) for alleged collusion with other bidders.
The health department referred Hetero South Africa to the competition commission for investigation, and a probe was started in November.
Hetero’s international marketing director Bhavesh Shah said the company was committed to expanding access to high-quality and affordable medicines and anti-retroviral production in South Africa. “This acquisition represents an important milestone in advancing healthcare delivery and strengthening the local production of ARVs to address the unmet medical needs in South Africa,” he said.
While Barrs’ agreement with Hetero South Africa provides the health department with some assurance that critical Aids drug supplies are secure, Barrs’ troubles are not entirely over.
Partial shutdown
Part of the Cape Town-based pharmaceutical manufacturer has been shuttered since September after it failed to rectify problems that had been repeatedly flagged by inspectors from South Africa’s medicines regulator, the South African Health Products Regulatory Authority (Sahpra).
Routine Sahpra inspections in 2021 and 2023 identified problems that had still not been rectified when officials visited the company again in August 2025. Sahpra consequently issued Barrs with a directive instructing it to cease manufacturing activities and quarantine all products manufactured at its non-compliant facility, it told Business Day.
The inspectors had identified problems, including deficiencies in Barrs’ contamination and cross-contamination controls, that posed potential risks to product safety and quality, said Sahpra.
Barrs submitted a plan to Sahpra in January with proposed corrective measures, but it has yet to be approved by the regulator, said Lebohang Mazibuko, senior manager for Sahpra’s Inspectorate and Regulatory Compliance division
Gribnitz said only Barr’s business operations for making creams and liquids were closed. The rest of the business, including the facilities for repackaging imported morphine powder and manufacturing Aids drugs, is unaffected by Sahpra’s directive, he said.
The health department confirmed Sahpra’s directive did not affect the supply of Aids drugs or morphine. Barrs told Business Day last week that it had begun fulfilling outstanding orders for morphine powder after a prolonged shortage at the end of last year, which it attributed to increased global demand.
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