Africa – New nucleus of opportunities for API

Africa – New nucleus of opportunities for API

by avachem, January 11, 2019

Modern lifestyle has led to an increase in life-threatening diseases. To combat them new discoveries and innovations in the field of medicine is a must. The Pharmaceutical Industry has gradually emerged as a leading industry in providing low cost drugs to overcome health issues. Society looks forward to this industry to provide quality generic alternatives not only in the developed countries but also the developing nations. From the business point of view, the pharma industry due to API has become highly competitive and profitable industry.

At present, the objective of the Pharmaceutical Industry is to raise the standard of quality, safety and efficiency of the drugs manufactured. The quality of raw-material utilized, the API and its Excipients play a pivotal role in determining the profit margin of the pharma industry. The API is the vital component in the drug manufacturing process and determines the price of the final product. Such is the value of the API that majority pharma drug manufacturing companies have their own API manufacturing units and are not dependent on API suppliers.

Africa- The largest Importer of generic drugs

Today, every sixth person on the earth is from Africa. The population of Africa has grown by leaps and bounds since 2010. As per statistical data from the UN, Africa’s population increased from 140 Million in 1900 to 1 Billion in 2010. It is estimated to cross a figure of 2.5 Billion by the end of 2050. The reason for the population explosion is that Africa has a very high proportion of young generation of reproductive age between 15 to 49 years.

The increase in population and the current health scenario in Africa has led to an increase in demand for generic drugs. Majority countries of the continent of Africa are facing several health hazards. AIDS, cancer, obesity and other lifestyle diseases are posing a grave threat to the survival of people in this continent. Most of the countries in Africa are inhabited by middle-income and low-income group. Manufacturing medicines at a reasonable price has become absolutely necessary. The precarious situation has put tremendous pressure on the API industry to produce quality drugs. This has given the Indian API Industry a plethora of opportunities to export quality drugs to Africa. It will be wise to say that Africa is one of the biggest importers of API from India. According to Sudarshan Reddy, Chairman of DSR Labs Pvt Ltd. “African Countries are the greatest beneficiaries from the Indian Manufacturers”

There are several factors responsible for the increase in imports of API by Africa. New diseases like Ebola and Swine Flu have forced the pharma industry to discover low cost drugs. These two diseases have created havoc and panic by killing thousands in West Africa. Along with the new diseases, the prevalent communicable and non-communicable diseases are proving to be a colossal burden on the planet earth. Not only India but several nations across the globe have joined hands to produce affordable medicines for the impoverished people of Africa.

The Emerging API Industry in Africa

The local Pharma and the API in Africa is still in the infancy stage. No significant progress and development has been made. The main factors responsible are poverty, high rate of illiteracy and unstable government. There are no guidelines and health strategies to elevate the standard of living. The adverse state of affairs has forced Africa to import pharma drugs from India and other South-Asian countries

According to the United Nations (UN), there are 55 countries in the African Continent. Barring a few, most of them are reeling under abject poverty, hunger, malnutrition and insanitary conditions. As per the World Health Organization (WHO), the low-income population of Africa has shown an alarming increase in deaths due to HIV infection, Malaria and Tuberculosis. The pre-natal and post-natal deaths due to malnutrition are also high as compared to other developing nations of the world.

As per WHO reports, chronic diseases will lead to high rate of mortality in the next 20 years. The sharp increase in demand for low-cost quality drugs has given a thrust to India’s export. India is the leading nation in exporting pharmaceutical products to some major countries of Africa like Nigeria, Kenya, Ghana and South Africa. India is also the forerunner in the production of pharma products, followed by Bangladesh, Pakistan, and Sri-Lanka.

Advantage India

Not all looks gloomy in the African Pharma Industry. They too have realized the critical importance of quality drugs. Gradually, the API industry is growing and offering lucrative opportunities for its domestic and international industries.

With increasing awareness and growing healthcare demand, the African pharma sector offers great opportunities both for its domestic and international companies. Africa is one of the fastest growing economies in the world. The demand for quality drugs to treat chronic aliment is rapidly increasing. It is estimated that by the end of 2020, the African pharma market will comfortably stand at US $45 Billion. With the current trend, the value is expected to rise further as per CAGR.

India continues to hold a tactical advantage as far as the global API market is concerned. Superior quality drugs at a reasonable cost is the prime factor that has boosted the Indian API across the globe. Other factors are higher demand for low cost generic, innovations and new developments in API, and patent of privilege drugs. Coincidentally, rise in chronic diseases, increased geriatric population, rising awareness in healthcare, and increased income have contributed towards the growth of the API industry in India.

The scenario can be corroborated from one of the reports on “Indian API Market outlook 2022”. As per the reports, the Indian API Industry is projected to grow at a CAGR of approximately 10% from the financial year 2016-2022. The reports give a brief insight into the major attributes of the market and the prospective impediments to the growth.

The API industry in India is fragmented on the basis of several factors such as the type of production and the type of therapeutic benefits. The report focuses on the mergers that took place in the API market across India. Top Indian Companies that made headlines internationally in the field of generics, research, and pharmacies are Cadila Healthcare, Ranbaxy, Nicholas Piramal, Aurobindo Pharma, Wockhardt, Sun Pharma and Dr Reddy’s Laboratories. Due to the low cost of production, the International Pharmaceutical Industry has been outsourcing an array of activities including manufacturing, formulation, clinical research, and packaging from India.

As per research conducted by the renowned management firm, Mckinsey & Company, the Indian Pharmaceutical market is projected to be the sixth largest in the world by the end of 2020. It currently exports API, bio-pharmaceuticals, drug intermediaries and various pharma formulations to the international market. Although Africa displays a rather complex market and a highly volatile pharma growth, the challenge remains to successfully navigate and achieve stability. Till then, India shall hold a strategic position and continue to export low-cost affordable drugs to Africa.

AVA Chemicals is an ISO 9001:2015 certified manufacturing company based in Mumbai. We are one of the leading manufacturers of speciality chemicals used as Excipients / and in manufacture of API and Bulk Drugs. API is the backbone of any pharma industry and our well-established plants adhere to strict quality control formulated by experts. We are customer-centric and focus on conducting business for the complete satisfaction of our esteemed clients.AVA Chemicals aims to be known as an ethical company providing specialty chemicals to companies who manufacture products that are used in day-to-day life, thus touching the lives of millions of people.

For more information, please visit or email us at