U.S. International Development Finance Corporation (DFC), IFC of the World Bank Group, the French Development institution Proparco, and DEG – the German development finance institution, today announced a joint financing package for Aspen Pharmacare Holdings Limited, a leading pharmaceutical company in South Africa.
The €600 million long-term financing package, which is subject to the fulfillment of certain conditions precedent, is mobilized by IFC, the private sector arm of the World Bank Group. It includes €200 million from IFC’s own account, €156 million from Proparco, a subsidiary of Agence Française de Développement (AFD Group), €144 million arranged by DEG, and €100 million from DFC. It’s the largest healthcare investment and mobilization IFC has led globally to date.
The company is said currently playing a major role producing COVID-19 treatment therapies and vaccines on the African continent. The announcement about the financing package for Aspen also comes as governments across Africa have called on the international community to bolster the continent’s vaccine supply chain to respond to COVID-19 and promote longer-term health sector resilience.
The financing will help Aspen, Africa’s largest pharmaceutical company, to refinance existing debt and strengthen the company’s balance sheet, supporting Aspen’s operations including production of vaccines, and other therapies in African and emerging markets. The four development finance institutions also have the objective of helping to facilitate an increase in vaccine manufacturing know-how and knowledge sharing within Africa by partnering with Aspen.
Aspen is expanding its role in fighting the COVID-19 pandemic in Africa. Aspen has partnered with Johnson & Johnson to compound, finish, fill and package the Janssen (a Johnson & Johnson company) COVID-19 vaccine at its sterile facility in South Africa. Aspen has recently built a fully certified sterile injectables facility at its existing site at Gqeberha (formally known as Port Elizabeth), South Africa. With this new facility, Aspen was able to offer Johnson & Johnson filling, finishing and packaging capacity for its COVID-19 vaccine, with the first batches having already been manufactured.
“We are grateful for the opportunity to access this funding package arranged by IFC. Aspen’s teams are working tirelessly to optimize production of the Johnson & Johnson COVID-19 vaccine for Africa at our manufacturing site in Gqeberha, South Africa. We are actively seeking opportunities to further extend and capacitate COVID-19 vaccine manufacturing at this world class production facility. Aspen is seeking to play a meaningful role in contributing to the objective of delivering the majority of Africa’s needs from production sites located in Africa,” said Stephen Saad, Aspen’s Group Chief Executive.
“COVID-19 has again highlighted Africa’s reliance on global vaccine supply chains, leaving the continent vulnerable to disruptions and delays,” said Makhtar Diop, IFC’s Managing Director. “By partnering with Aspen, a leading vaccine manufacturer in Africa, and collaborating with partners in the development finance community, the World Bank Group can contribute to the continent’s continued vaccine manufacturing development and support knowledge sharing and technology exchanges. Together, we hope this will save lives now and help ensure that Africa is prepared ahead of any future health crises.”
The African Union and Africa CDC announced in April 2021 an ambition for Africa to manufacture 60 percent of its vaccine needs on the continent by 2040. Currently, Africa manufactures only about one percent of the vaccines it uses.
“French President Emmanuel Macron committed to investing in enabling the production of vaccines in Africa, for local production will be key to win the battle against COVID-19. Today, I am proud that the AFD Group, through its private-sector arm Proparco, partners with other development finance institutions and Aspen, one of the major pharmaceutical companies in Africa and a ‘front-liner’ manufacturer of COVID-19 drugs and vaccines, to help close a gap in the availability of the shots between African and Western nations. This project shows that global public goods require financing in common, to which public development banks are ready to contribute,” said Remy Rioux, CEO of AFD Group and President of Proparco.
“DEG’s mission is to be a reliable partner to private sector enterprises as drivers of development and creators of qualified jobs. We are pleased to contribute to this vaccine production in Africa together with our development finance partner institutions. We are convinced that it is essential to join forces to fight the pandemic effectively, and the private sector plays a key role in this,” said Monika Beck, Member of DEG’s Management Board.
“DFC is proud to be working with our partners at IFC, Proparco, and DEG to support critical vaccine production efforts on the African continent, in alignment with President Biden’s strategy to bring an end to the pandemic. The DFC’s support for Aspen expands critical manufacturing abroad, in Africa, for Africa,” said DFC’s Chief Operating Officer David Marchick. “This project is the first of many that will help build local capacity and create self-reliance for regions around the world, and will help immediately address the current pandemic while also boosting future pandemic preparedness efforts.”
The World Bank Group has been scaling up support to countries to produce, acquire and deliver vaccines to more people, particularly in Africa. The World Bank Group is providing billions of dollars in vaccine financing to help countries purchase and distribute vaccines in order to address readiness issues. IFC’s investment in Aspen falls under its Global Health Platform launched in July 2020 to help developing countries fight the coronavirus pandemic and increase their healthcare systems’ resilience. Including this new project, IFC has committed $1.82 billion in COVID-19 related projects since March 2020, of which $1.15 million falls under the Global Health Platform (GHP) that was created specifically to support vaccines and related initiatives.
Proparco’s investment is part of the initiative launched in April 2020 by the French President and implemented by AFD Group, “COVID-19 – Health in Common” – a €1.2 billion initiative in response to the worldwide public health crisis caused by the COVID-19 pandemic. This French program is being further reinforced in 2021 and is part of a European effort to mount a targeted, partnership-based response to this unprecedented crisis facing developing countries. It complements the work of multilateral and European donors and prioritizes the African continent.
DFC’s investment is part of the agency’s Health and Prosperity initiative which is focused on supporting the global response to the COVID-19 pandemic and strengthening health resilience in developing countries. Through the initiative, DFC is working to invest $2 billion in projects that bolster health systems, support infrastructure development, and expand access to clean water, sanitation, and nutrition.