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EF: How do you effectively manage and balance this region's diverse priorities, needs, and resources?
KB: The first step is attracting the necessary resources to the region As the company's chairman, the key lies in selecting an investment avenue with a robust system and predictable return on investment. For instance, investing in China might yield a threefold return before finally reaching Africa, where the return might be one and a half times the initial investment at best. Conveying the potential of the continent's opportunities may take much work.
Reflecting on my journey, three defining periods come to mind. Firstly, we meticulously analyzed Africa's healthcare landscape around 2003-2004. This comprehensive assessment encompassed prevalent health challenges, demographics, infrastructure, regulatory environment, and existing healthcare providers. This groundwork laid the foundation for our future endeavors. Subsequently, in 2010, we embarked on our Africa strategy, where we artfully articulated the company's mission and vision for the continent. The convergence of our prior analysis and strategic planning allowed us to approach Africa's potential with clarity and purpose. During the rollout phase from 2010 to 2018, we established more than 12 African affiliates, starting with South Africa as the first existing Merck legal entity. This expansion journey took us to Tunisia, Algeria, Morocco, Côte d'Ivoire, Accra, Lagos, Nairobi, Addis Ababa, Rwanda, and other locations. It was a remarkable experience, rich in cultural and diverse learning opportunities.
Taking on the mission of Africa Affairs, I recognized the importance of engaging with stakeholders to foster a sustainable healthcare system in Africa. Identifying key players, such as government agencies, local communities, NGOs, healthcare professionals, and influential organizations like the WHO, WTO, and intellectual property organizations, became a crucial focus. As a private sector entity, we can contribute significantly to shaping Africa's healthcare landscape and supporting the region's development. This undertaking holds immense promise, and I accepted this responsibility with enthusiasm and dedication.
Engaging all these stakeholders is pivotal in shaping the company's future and positively impacting the industry. As Head of the Africa Bureau at Merck, I actively collaborate with different stakeholders, sharing our sustainable business model and seeking their valuable input. At this stage, we are earnestly working on aligning our business model with the actual realities and needs of the stakeholders. As a private entity, flexibility is key when engaging with public and nonprofit organizations. We must adapt and evolve to effectively serve their interests. If we cannot adapt, we must be open to stepping back from the market and reevaluating our approach. Embracing adaptation is the key to success in building fruitful partnerships and a lasting presence in the African market.
EF: What strategies can address the healthcare spending gap, and how can the healthcare system sustainability be enhanced? Can technology play a pivotal role in expanding access to healthcare as demand rises?
KB: Before delving into the inevitable realm of digitalization, AI, and technology, we must first wholeheartedly commit to and support the UHC goals for 2030. However, we find ourselves in 2023, nearing the year-end, and significantly behind our objectives and those set by the WHO and the United Nations in achieving universal health coverage. This lag poses a substantial challenge as it hinders the creation of a sustainable market and proper service to the African population, making it a critical issue. To grasp the essence of UHC 2030, we recognize the urgent need for a robust and sustainable primary healthcare system. Additionally, ensuring regulatory compliance, along with endorsing the African Medicine Agency, holds paramount importance. Embracing the Free Trade Continental Agreement becomes crucial in this healthcare ecosystem. With standardized prices across Africa, irrespective of VAT and customs duties, we can bridge the current price disparities affecting patients. This agreement requires our unwavering support. Ultimately, the backbone of this transformation lies in the digitalization of primary healthcare, a key aspect in achieving our goals.
Amidst the COVID pandemic, numerous software solutions tailored specifically for Africa, even catering to distinct cultures and religions, have been developed. However, these solutions face a significant funding gap, with an estimated shortage of 120 million, as reported by the World Bank. While funds are available, the challenge lies in accessing them, despite successful efforts in mobilizing resources for local vaccine manufacturers. For instance, the African Development Bank released a substantial 4 billion fund for local manufacturing and finance, yet, six months later, it remains largely untapped. Additionally, there are financial resources from the European Union, making it essential to bridge the gap between available funds and promising African solutions.
Embracing a soft approach, akin to the European Union's model, while respecting diverse methods from other regions like China and the US fosters cooperation between the European and African Union. It's crucial to channel these resources effectively, supporting the growth and implementation of indigenous solutions across Africa.
In 2021, Africa's GDP stood at USD 2.7 trillion, and it's projected to reach USD 5.520 trillion by 2050, making it a formidable economic force, surpassing the US in collective GDP. With a population expected to grow from 1.3 billion to 2.5 billion, investing in Africa becomes unavoidable and promising. As the population urbanizes, with cities expected to house 60% of Africans by 2050, a tremendous market opportunity lies. We can effectively serve urban and rural people by implementing a robust primary healthcare system, fostering significant consumer spending growth from 2 billion to 5 billion.
Pharmaceutical companies must embrace cultural sensitivity, agility, and adaptability to thrive in this evolving landscape. Being digital and modern is vital as changes happen rapidly. Engaging with local communities, understanding their needs, and improving decision-making are paramount for successful and sustainable health systems. The time to act is now, with available solutions and a wealth of experience. Embracing the transformation will yield financial rewards and contribute positively to the well-being of the African population.
Africa carries 25% of the global disease burden, yet only 3% of clinical trials occur on the continent, primarily due to the challenges of building a robust ecosystem. However, establishing the necessary infrastructure, like hospitals, medical centers, ethical committees, and regulatory frameworks, could attract a substantial portion of the industry's pending 100 billion clinical trials. This influx of funds, even capturing just 20%, could significantly buffer Africa's healthcare expenditure.
The pharmaceutical industry has made significant strides in ethics and compliance over the past two decades, leaving behind practices like bribing. Although isolated incidents may still occur, they are swiftly addressed through legal or self-regulatory means. Collaboration and understanding among stakeholders are crucial in realizing the vision of a UHC with accessible primary healthcare, where the private sector plays an integral role in the journey toward progress. Listening, understanding, and responding to each concern ensures a fruitful and united path forward.
EF: How is Merck contributing to the production and localization of manufacturing in Africa?
KB: Merck is a science and technology company focusing beyond pharma, particularly on the life science aspect, which holds greater significance than biopharma. Reflecting on my experience from Serono's biotech journey, I proposed an approach for Africa in 2007. Having been part of Serono's early biotech journey, I understood its challenges. I suggested consolidating our learning into a unified unit for global transfer, recognizing its potential as a business source and for future health security.
Emphasizing local manufacturing, I advocate against multinational companies investing directly. Local manufacturers and investors should lead, fostering voluntary partnerships and product transfers. This safeguards against uninformed decisions by external parties, preventing detrimental factory closures and job losses. Collaborative partnerships are crucial, but local leadership is the backbone, ensuring Africa's health security and robust supply chain through a locally driven approach.
A vital consideration lies in paying attention to APIs (Active Pharmaceutical Ingredients). While it might seem simple to produce tablets using APIs sourced from elsewhere, a mere 20-million-dollar investment, the dynamics change during a pandemic or export restrictions, as seen during COVID. India's export ban and China's border closure highlighted the vulnerability of relying on external APIs. By investing in API production, we gain global control – a lesson evident from my experiences with WHO and during the pandemic. For instance, during COVID, when India held a key role in vaccine production, their decision impacted our vaccine delivery to Africa. Recognizing this, investing in API capabilities becomes a strategic move with far-reaching impact. Securing a local API supply chain empowers us to navigate global uncertainties and strengthens our healthcare resilience.
EF: Can you discuss the treatment gaps in Africa and how newly developed drugs could address these gaps and impact the region?
KB: The initiative began addressing malaria and neglected tropical diseases, like schistosomiasis, in 2007. Collaborating with the WHO was uncommon for the private sector back then. Despite this, my focus was on impact rather than profit. We aimed to donate treatment tablets for bilharzia, a disease affecting school-aged children. However, the tablet size needed to be improved for easy consumption, leading us to form a team of medical experts to develop an oral solution or a more compacted tablet.
Clinical studies were conducted in Africa, hoping to obtain the first approval from an African country. Our team and Merck's R&D department collaboration yielded a locally developed product. Similarly, the approach is customized to Africa's unique conditions in addressing malaria. Genomics plays a significant role, as Africa holds 17% of the global population, necessitating tailored solutions. The industry is heading towards personalized treatments, emphasizing the importance of including Africa in international clinical trials for equitable healthcare progress.
Returning to a specific case, consider a country where a clinical study for a well-known product took a year and a half for ethical committee approval. Facing this delay, I intervened at the highest level, having engaged with African presidents during COVID vaccine negotiations. The process needed to be improved. While certain countries experience lengthy approvals, the product already holds FDA, European, Japanese, and other major approvals. This bureaucratic approach contradicts our continent's aspirations and must change for Africa to be competitive.
I challenge the private sector to be proactive. While I advocate for access and affordability, waiting seven years for a product's market entry compromises innovation. Biotech products, unlike generics, cannot afford such delays. Participation in clinical trials and subsequent negotiations better serves both patients and progress. As we adapt to new medical frontiers, leveraging AI and innovative thinking becomes vital to finding practical solutions that empower Africa's healthcare landscape.
The Africa Engagement Committee embraces a remarkable culture. Patience and cultural sensitivity yield significant rewards for the company and its shareholders. The two aspects are intertwined – our profitability mirrors that of countries in the Middle East. This underscores the synergy between commercial success and fostering sustainable African growth. Viewing these as interconnected facets is key to achieving a profitable and impactful business.
EF: What is your role within the African Engagement Committee at IFPMA, and how are you facilitating collaboration? How is your organization actively contributing to advancing Africa's health ecosystem?
KB: Many significant health decisions are made in Geneva due to its role as the headquarters of WHO, WTO, and other UN agencies that support progress on the SDGs For instance, policies cascaded through WHO, AFRO, and national health ministries. The impact of decisions from global organizations like the World Trade Organization, such as intellectual property (IP) waivers, needs re-evaluation. Discussions on building local production capabilities should precede IP concerns and should be flexible, voluntary, and sustainable. Collaborations with ministries beyond health, like finance, are crucial for effective policy implementation. Geneva's regulatory ranking system aids local manufacturing efforts by guiding nations to meet necessary healthcare regulations before producing vaccines or bioproducts.
A collaborative approach is key; private sectors should avoid working in isolated silos. For instance, as an AMREF commissioner, I advocate for health investments to safeguard against economic collapse during crises like COVID. Health should be viewed as an investment, akin to infrastructure projects with delayed returns. Industry players must harmonize efforts, collaborating for a stronger impact. The IFPMA Africa Engagement Committee plays a vital role in unifying visions, bridging the interests of both the continent and businesses to foster shared progress.
EF: How would you want to be remembered as a leader and an executive, not only for your impact in Merck but your impact in Africa?
KB: Assessing life's impact can be complex, with positive and negative outcomes hard to quantify. I aspire to be recognized as a soldier in the war to establish robust African healthcare systems. This fight is crucial, and being acknowledged as a soldier in this effort would be deeply fulfilling and satisfying to me as an individual.