KENYA— The regional pharmaceutical distribution company, Shalina Healthcare has received approval from the Competition Authority of Kenya (CAK) to purchase Provexa.
Shalina Healthcare will acquire all of Provexa’s issues and that will allow Shalina to now control 2.3% of the market share in the sector, according to CAK.
Provexa, is a local wholesale distributor of cheap generic drugs, enabling customers to find a wide range of cost-effective pharmaceutical products locally.
Shalina Healthcare is a privately-owned firm that has been targeting operations in Africa for the past 30 years, having launched in Angola, the Central African Republic, the Democratic Republic of Congo, Ghana, Kenya, Nigeria, and Zambia.
Most of the company’s operations are in prescription and over-the-counter medication, such as antimalarials, antibiotics, anti-inflammatories, and nutrition.
Shalina asserts that they achieve and meet quality standards by sourcing from WHO-approved production facilities in India and China and by focusing on their distribution expertise.
Through their manufacturing and distribution hubs in the UAE, China, and India, where their source, store, and distribute their generic and branded pharmaceutical products.
The facility is built to adhere to the most stringent operating procedures of cGMP in conformity with national and international standards.
Wang’ombe Kariuki, Director General of the Competition Authority of Kenya said that the merger would not affect competition negatively since the acquirer’s assets meet the threshold for exclusion as provided under the Merger Threshold Guidelines.
“This approval has been granted on the finding that the transaction is unlikely to negatively impact competition in the market for wholesale distribution of pharmaceutical products nor elicit negative public interest concerns,” said Kariuki.
The merged entity will face competition from wholesale pharmaceutical products supplied directly to hospitals and pharmaceutical retailers.
Shalina Healthcare made its entry into the Kenyan market in 2019 by acquiring Pharmaceutical Manufacturing Company (Kenya) Limited.
Africa continues to be a lucrative market for medicines
According to Brookings, Africa Trade in the pharmaceutical report, Africa relies heavily on imported pharmaceutical goods to support the region’s healthcare needs.
Moreover, as of 2019, as much as 70% to 90%, depending on the country, of the drugs consumed in sub-Saharan Africa, estimated at US$14 billion pharmaceutical market were imported.
Likewise, Africa represents nearly 25% of the global demand for vaccines but produces only 0.1% of the world’s vaccines.
Kenya is currently the largest producer of pharmaceutical products in the Common Market for Eastern and Southern Africa (COMESA) region, supplying about 50% of the region’s market.
The country’s formal medical distribution sector has attracted major investors, including private equity funds as a health-conscious middle-class population spawns a booming healthcare market.
In February 2023, Mauritian conglomerate IBL Group bought an undisclosed stake in Nairobi-based pharmaceuticals distributor Harley’s as part of a consortium that has taken control of the company.
The multinational also bought a majority stake in Harley’s which supplies pharmaceutical products and medical equipment.
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