June 30, 2020 / 10:36 AM / a month ago

S.Africa in talks with India's Macleods to set up HIV drug maker

* South Africa’s Ketlaphela to partner with Macleods

* Macleods could transfer intellectual property

* South Africa has world’s largest ARV treatment programme

By Wendell Roelf

CAPE TOWN, June 30 (Reuters) - South Africa is in partnership talks with India’s Macleods Pharmaceuticals Ltd to set up a state-owned company to make and sell HIV drugs in the local market, industry officials said.

South Africa has one of the highest number of HIV patients in the world, with 5 million infected people. The new firm would make ARVs, or antiretrovirals, to help supply what is the world’s largest ARV treatment programme.

Dave Nicholls, board chairman at the state nuclear research and enrichment agency Nuclear Energy Corporation (NECSA), told Reuters that Ketlaphela Pharmaceuticals, a unit of NECSA’s subsidiary Pelchem, was in discussions with Macleods.

“They are the preferred bidder,” he said, without giving a value for any investment or a timeline.

Ketlaphela Chairman Ivan Radebe said the company planned to make active pharmaceutical ingredients (API) based on a deal under which Macleods would transfer intellectual property to make drugs that the Health Department would commit to buy.

Privately-owned Macleods did not respond to an emailed request for comment.

South Africa has no local facility to produce API, the main therapeutic component in ARVs and accounting for about quarter of the cost of dosages.

Ketlaphela had been searching for a partner since 2013 when Swiss firm Lonza Group pulled back from its investment plans in South Africa. At that time, the cost of setting up an API plant was put at 1.6 billion rand ($92.4 million).

Once authorisations from the government and regulators were in place, Ketlaphela could start formulating and packaging pharmaceuticals to generate revenues and raise funds for an API facility, Radebe said.

Ketlaphela would seek financing from the New Development Bank, an institution promoted by Brazil, Russia, India, China and South Africa, a group known as BRICS, and others, such as South Africa’s Industrial Development Corporation, Radebe said.

$1 = 17.3148 rand Reporting by Wendell Roelf; Editing by Promit Mukherjee and Edmund Blair

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