Novo Nordisk contracts South Africa's Aspen to produce insulin for Africa

Novo Nordisk has contracted Aspen Pharmacare to produce human insulin on its behalf in South Africa for export to African countries through a low-cost government tender system, the Danish drugmaker said on Tuesday.

Announcing the deal on the sidelines of the UN General Assembly in New York, Novo said the contract will lead to the production of 16-million vials of insulin next year, marking its “expanded commitment” to improving access to the life-saving drug for people on the continent living with diabetes.

Novo said the amount Aspen will produce next year under the contract equates to the yearly consumption of 1.1-million people with type 1 and 2 diabetes, adding that it currently reaches 500,000 people with the disease across sub-Saharan Africa.

By 2026, the amount of insulin produced will equate to the yearly consumption of 4.1-million people across the continent, it said.

“Especially in lower- and middle-income countries, diabetes is fundamentally a tragedy,” Katrine DiBona, Novo's corporate vice-president for global public affairs and sustainability, said. She cited a company estimate that 60-million people globally need insulin, but cannot access it.

Novo became Europe's most valuable company earlier this month on booming sales of its obesity and type 2 diabetes drugs. It has a market capitalisation of about $420bn (nearly R8-trillion).

The Aspen-produced insulin will be distributed to health authorities and non-governmental organisations through a tender system, with a guaranteed ceiling price of $3 (about R57) per vial, said Novo. It did not release further financial details about the contract.

The deal could help Aspen, Africa's biggest drugmaker, use the expanded manufacturing capacity it built during the Covid-19 pandemic. Aspen invested about $540m (about R10bn) to expand facilities in South Africa and France, but orders for its vaccine failed to materialise.

That left the increased capacities loss-making, Aspen's CEO said last month after the company announced it had secured agreements with three global companies to produce their drugs at its French facility.

Novo chose Aspen as its partner due to its credibility as a drug manufacturer, DiBona said.

Reuters