This slide shows about the opportunities in the Pharmaceutical sector investment in Ethiopia! The author can be reached at bonse31@gmail.com

1. 1
Ethiopian Food, Beverage & Pharmaceutical Industry Development
Institute, Ministry of Industry.
June, 2015

2. Invest in Ethiopia
A Guild for Pharmaceutical
manufacturing Investments
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3. I. comparative Advantage to invest in Ethiopia
 The Federal Democratic Republic of Ethiopia welcomes, promotes and protects
private enterprises.
 The comparative advantages to invest in Ethiopian pharmaceutical and
medical supplies sub-sector include:
 Access to the regional market
 Strategic location
 Stable political climate
 Abundant and trainable labor force
 Simple and transparent investment approval procedures
 Ample opportunities in privatization program
 Competitive incentive packages
 Availability of suitable industry zone
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4. I. Comparative advantages and opportunities to invest in Ethiopia/cont’d…
1. Geographic Location Advantage
 Ethiopia is geographically well-positioned and accessible to wide & growing
markets. Ethiopia also enjoys Duty Free and Quota Free (DFQF) privilege
extended by international markets of USA (AGOA), EU (EBA), China, India,
Japan & Korea. COMESA Market about 19 countries, 450 M Pop. Middle East
and International markets
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5. I. Comparative advantages and opportunities to invest in Ethiopia
2. Major Important Facts about Ethiopia
Political ,Social and Macro-economic Stability
 Fast Economic Growth
 Good Governance & Attractive Investment Law
 Zero Tolerance for Corruption
 Lowest Crime Rate in Africa
 Commitment to Support Private Sector Development & FDI
 Competitive Incentive Packages
 Simple and Transparence Investment Approval Procedures
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6. Cont’d…
3. Attractive Investment Policies and Incentives
 No restrictions on equity ownership in joint venture investment with domestic investors
 One incentive policy for domestic & foreign investors
 Generous incentive
 Income tax exemption (2 to 8 years)
 Exemption from the payment of customs duty
 Carry forward of losses: half of the tax holiday period
 Export Incentive Schemes: Duty Draw-Back scheme, Voucher scheme, Bonded
 Manufacturing Warehouse scheme and Export Credit Guarantee scheme
 Hand holding Support through the Sector Supporting Gov. Institutes
 Guarantee against expropriation or nationalization (Constitution & Investment Law, MIGA & BITs
 Full repatriation of profits, dividends, principal and interest payments on external loans
 The right to employ expatriate experts and management staff
 Bilateral Investment Promotion & Protection Treaties with more than 30 countries
 Double taxation avoidance treaties with 18 countries
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7. Cont’d…
 Development of Industry Zones
 A) Industry Zones that are under Development by
Federal Government MoI (Regional
 B) IZ by Private Developers
 * Kilinto Industry Zone
•Kilinto: 308 hectares under Master plan and
design preparation stage
 Kilinto will cater to the pharmaceuticals, agro-processing,
food and beverage sectors.
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8. Incentives for Pharmaceutical Manufacturers
In order to reach the above GTP goals , government has been
providing these incentives for PHARMA industries:
 Importation of all pharmaceutical input materials on zero
tariffs.
 30% advance payment for local producers by
Pharmaceutical Fund and Supply Agency (PFSA)
 PFSA provides closed tender for local PHARMA companies
 PFSA takes up products of local pharmaceutical
manufacturers by a 25% preference in international tender.
 Enabling PHARMA companies to be GMP compliance
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9. Locally Manufactured Pharma Products
 Currently, there are 22 Pharmaceutical and medical supply
manufacturers, out of which 9 are human drug
manufacturers:
• Product types:
 Human Drugs
 Veterinary drugs and vaccines
 Malaria Rapid Diagnostic Kits
 Surgical dressing and antiseptic disinfectants
 Disposible Syring
 Hospital Beds/Delivery & examination beds
 Absorbent Cotton
 Orthopedic Cushions and Pillows
 Surgical meshes
 IV bags
 Diagnostics reagents for laboratories
 Empty hard gelatin capsules
 Mouse serum
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10.  List of Locally manufactured Essential Medicines
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Tablets Capsules Ointments IV
fluids/Injecta
bles
Syrup/Sus
pension
Cimetidin 400 mg
Norfloxacine 400 mg
Cotrimoxazole 480 mg
Tinidazole 500 mg
Ciprofloxacine 500/250
mg
A.S.A 300mg
Al.Hydrox.+Mg.Tristil
(120+250mg)
Amitriptyline 25mg
Arthemeter 20mg +
Lumefantrine 120mg
Ascorbic Acid Tablet
Cetrizine
Chloquine Phosphate
250mg
Frusemide 40mg
Hyoscine BB.
Iburoprofen
Mebendazole100mg
Niclosamdie 500mg
Parcetammole 500mg
Metronidazole
250 mg
Doxycycline 100
mg
Amoxicillin
250/500mg
Chloramphenicol
250mg
Cloxacillin
250/500mg
Doxycycline
100mg
Tetracycline
250mg
Fluxetine
Indomethacine
Zinc Oxide 15%
20/1000gm
Ichthamol 10/20%
Benzoic Acid 6% +
Salicylic Acid 3%
Sulphur 10%
Methyl Salicylate
25 %1000gm
Dermalar cream
0.025 % 10 gm
White Fields 1000
gm
White Fields t 20
gm
White petrolatum
50/1000 gm
Fluconazole 100mg
Chloroquine
phosphate 50 mg/5
ml (inj)
5% dextrose in
water, 1000ml
0.9 % sodium
chloride, 1000ml
5% dextrose in
saline, 1000ml
Ringer Lactate,
1000 ml
BenzathinePenicill
in 2.4miu
Peniciline
G.Sodium 1miu
Procaine Penicillin
4miu
Diclofenac Sodium
Dextromethor
phan HBr
15mg/5ml,125
Diphenhydram
ine HCL 12.5
mg/5 ml, 125
ml
Paracetamol
Syrup 120 mg/5
ml, 60 ml
Piperazine
Citrate 500
mg/5 ml, 30 ml
Albendazole10
0mg/5mlsusp.
20ml

11. Tablets Powders Syrup/Suspension
Theophedrine 120mg/11mg
Tinidazole 500mg
Griseofluvin 125mg
Levamizole 2400 mg
Phenobarbitone 30/100 mg
Predinsolone 5 mg
Promethazin 25 mg
Theo ephedrine compound
Vitamine B-complex Tablet
Chlorpromazine 25/100 mg
Azithromycin 250mg
Atorvastatin 20mg
Ketoprofen 50/100mg
Meloxicam 7.5/15mg
Diclofenac Sodium 50mg
Zinc Sulphate Monohydrate 20mg
Albendazole 200/400mg
Methyldopa
Amilodopine
Famotidine
Qiunine Sulphate
Glibenclamide
Alloprinol
Hyocine
Flavored O.R.S 28.1gm
Lemlem 20.7 gm
Magnesium Sulphate powder
15 gm
Oral rehydration salt 20.5 gm
Omenipazole 20mg
Amoxicillin 125/250mg/5ml -
100ml Dry Susp
ChloquinePhosphate50mg/5ml
syp
Co-Trimoxazole susp.
Mebendazole100mg/5ml
susp.30ml
Metronidazole 250mg
susp.100ml
Piperazine Citrate
Elx.700mg/5ml,29ml
Salbutamol Syrup
Multivitamine Syrup 120ml
Amoxicillin + Clav (125 +
31.125)/5ml - 100ml
Berantin 125 ml
Ephadex cough syrup 125 ml
Morphine 20 mg/5ml 125 ml
Paracetamol syrup 60 ml
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12. Tablets Veterinary Vaccines Veterinary Drugs Antiseptic &
Disinfectants
Enapril Maleate
Erythromycine
stearate
Ranithidine HCL
Sildenafil citrate
Anthrax
Bovine Pasteurellosis
Ovine Pasteurellosis
Black leg
Contagious Bovine
Pleuropneumonia (CBPP)
Contagious Caprine
Pleuropneumonia (CCPP)
Pest Des Petit Ruminants
(PPR)
Sheep and goat pox
Lumpy skin disease (LSD)
African horse Sickness (AHS)
Foot and Mouth Disease
(FMD)
Camel Pox
Rabies Vaccine
Newcastle HB1,Lasoto
Live Newcastle Thermo Stable
Infectious Bursa Disease
(Gumboro)
Fowl pox
Fowl Typhoid
Albendazole
Tetramisole HCL
Oxychlozanide+Levam
isole
Triclabendazole
Tetracycline+Multivita
mine
Multivitamin+Mineral
s
Trimetroprim+sulpha
diazide
Chloroxylenol 1.2 %
Cetrimide 3 % &
Chlorohexidine
Gluconate 0.3 %
Povidone Iodide 7.5/10
%
Denatured Alchohol
70 %
Hydrogen Peroxide 3%
Gluteraldehyde 2 %
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13. II. Supply/demand gap of Pharmaceuticals
 It has to be admitted that the Ethiopian pharmaceutical industry sub - sector is an infant
one. Existing industries produce only generic & similar drugs in small quantities.
Demand supply gap :-
 High rate of increase in the demand of pharmaceuticals
 Essential drug list: more than 350 drugs that need be available in the country. Less
than 100 of them are produced locally – and with small capacity.
 Local producers contribute approximately 15-20 % of the total market share while the
rest 80-85% of pharmaceutical & medical supplies products are imported.
 80% of drugs, medical supply materials and devices are imported
 According to a 2008 report from the Ministry of Health, the country’s demand in
pharmaceutical production increases yearly by 25%.
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14. III. Investment Opportunities
Opportunities for investment in the pharmaceutical and medical supplies sub sector in Ethiopia include: -
A. Production of essential drugs
 Existing industries produce only generic & similar drugs in small quantities
B. production of raw materials
 Local pharmaceutical and medical supplies industries depend a lot on imported sources. The industry
imports over 95% of the required raw materials. Availability of raw materials locally is limited to only about
5% of the total industrial requirements.
Possible potential of raw material production: -
Maize starch Rectified sprite and ethanol
Sodium chloride Refined sugar
Packaging materials Glucose syrup
C. production of medical supplies
 There is a real gap between the demand and supply of medical supplies such as surgical and latex gloves.
Large amount of these products are imported to the country.
D. Active pharmaceutical ingredients (API)
 There is no production of API in the country.
E. Production of Herbal Medicines
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15. 1. Getting Investment License
 The first step for the investor is to get investment license from the Ethiopia Investment Agency. The
agency also has other several responsibilities to render to investors.
Services at Ethiopian Investment Agency
The Ethiopian Investment Agency (EIA) is the government organ responsible for Promoting, coordinating
and facilitating foreign investment in the country. It is a one stop-shop for all investors in Ethiopia, and
renders the following services:
 Provides the necessary information required by investors;
 Approves and issues investment licenses to foreign investors;
 Provides trade registration services to foreign investors;
 Issues operating licenses to approved foreign investments;
 Notarizes Memorandum of Association and Articles of Association;
 Approves and registers technology transfer agreements;
 Registers export-oriented non-equity based foreign enterprise collaborations;
 Provides advisory and aftercare services to investors;
 Approves expatriate posts and issues work permits to foreign employees;
 Facilitate the acquisition of land and utility by foreign investors.
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16. Investment Guide /cont’d…
Requirement for issuance of Investment license
 Application form /containing investors full address and fee for service rendered
 Total investment capital and Foreign exchange it saves for the country
 Details of project implementation schedules indicating major activities with
corresponding period of accomplishment
 Project feasibility study
 The type of service provided / business objective of the project
2. Land acquisition
 Under the new land allocation scheme land acquisition is carried out through bidding
process (auction), direct land offer or through negotiation. Ethiopia Investment Agency
and Ministry of Industry have the mandate to facilitate the allocation of land for FDI
project throughout the country. The responsible bodies to allocate land are the regional
governments.
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17. Investment Guide /cont’d…
Requirements for land acquisition
 Investment license certificate
 Supporting letter from Ministry of Industry
 Project feasibility study and its summary
 If it’s a business organization, articles of association and memorandum of understanding.
 Title deed certificate or proof of ownership of the land if the land is required for expansion of existing
project.
 3D design.
When land request is accepted
 Investors have to provide document showing the investment potential to cover 20% of the total
construction cost approved by the bank to be deposited in a designated blocked account.
 If the project is financed through bank loan, the investor should at least bring a letter from the bank
approving to finance 20% of the construction cost from one bank only.
 Foreign investors should bring document showing their financial status from the respective banks of
origin on which the Ministry of Foreign Affairs and the local bank have approved.
 Industrial zone is given much attention by the government and the necessary infrastructure like roads,
electricity, water and telephone are facilitated. Industrial zones in all regions are allocated at low prices for
priority sectors like pharmaceuticals.
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18. Investment Guide /cont’d…
3. Getting Business license
 Ethiopia Investment Agency is given the mandate to carry out the issuance of business license for
foreign investors /for local investors issuance is through Ministry of Trade/, after the investment
project reaches the pre-operation stage so that the commissioning of the production is completed.
Major Requirements needed to acquire business license
 Lease agreement / Title deed certificate or proof of ownership of the land
 A foreign investor is required to invest not less than USD 100,000 in cash or in kind as an initial
investment capital per project and monitored through their commercial invoice
 Bank statement showing all the capital investment and capital breakdown
 List of the raw material required for the project implementation
 After Ethiopia Investment Agency issues investment permit and business license, it will notify
pertinent government organs to undertake the required follow up.
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19. Investment Guide /cont’d…
4. Bank Services
 All private and government banks are willing to provide loans for pharmaceutical
industries.
4.1 Loan
 Loan types extended by the banks include long term (20years), medium term (3-5years)
and working capital loans.
Banks checklist of requirements for all loans
 The major requirement that an investor should fulfill for all loans,
 Loan application
 License – temporary/permanent work permit for foreign investor
 Investment and principal registration certificate
 Tax payer identification number (TIN)
 Land /proof of ownership/
 Pro-forma invoice, utilities and source of equity
 Project feasibility study- having market, technical and project financial study
 Value added tax registration certificate (VAT)
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20. Investment Guide /cont’d…
Required credit documents list by banks
 Credit Application,
 Renewed trade or investment License,
 Principal Registration Certificate,
 Tax payer registration certificate,
 Profile and financial statement of sisters company/ ies , if applicable
 Detailed project feasibility study and /or business plan,
 Senior management and board of management profiles, if applicable,
 Registered memorandum and articles of Association, if applicable,
 Registered minutes of general assembly, if applicable,
 Publication of official Gazette/ establishment, if applicable.
 Partnership Agreement, if applicable,
 Official letter of consent from board of management, if applicable,
 Collateral,
 Letter of privilege for duty- free status
 Certificate for marital status , if applicable
 Residence and work permit for foreigners,
 Insurance policy, (After the loan is approved)
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21. Investment Guide /cont’d…
4.2 Opening foreign currency account at the
National Bank of Ethiopia
 The Authorization to open non- resident account
/foreign currency account/
 Application letter
 Duly completing two- application forms prepared by
the bank
 Foreign investment license (for foreign investors)
 Memorandum & article of Association (for PLC& Joint
investment)
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22. Investment Guide /cont’d…
5. Manufacturing license
GMP compliance is a requirement within pharmaceutical manufacture and testing of these
materials for human and animal consumption.
Some of the advantages of GMP certification for Ethiopian pharmaceutical industries are:-
 GMP certified factories guaranty safe and quality products.
 Getting GMP certificate is one of the criteria to access to donor funded market
potentials like Global fund, UNICEF etc…
 The GMP compliance will help local pharmaceutical companies to export their products
and to be competitive in the international market.
 Food, Medicine and Health Care Administration and Control Authority of Ethiopia
(FMHACA) is entrusted with the task of administrating and controlling of the
GMP of pharmaceutical sector.
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23. Investment Guide /cont’d…
Minimum requirements by FMHACA to establish pharmaceutical industry in
Ethiopia include:
1. They should collect establishment and GMP guideline from the authority. Here the
authority provides technical support starting from the design and location of the
premises.
2. Once the manufacturer comply with GMP and start manufacturing the products
should be registered by the authority to be marketed in Ethiopia (according to the
national registration guideline)
3. For those manufacturers engaged in exportation of pharmaceuticals, the authority will
give certificate of pharmaceutical product (CPP) if the manufacturer requests it and
submit all necessary information about the product to be exported.
4. The authority gives special attention for local manufacturer and it will give priority for
registration of products manufactured locally.
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24. Addresses of Important Government Bodies
1. Food, Beverage & Pharmaceutical Industry Development Institute
Tel:- 251- (11) -6- 394146
Fax:- 251- (11) -6- 394209
E-mail:-fbpid@ethionet.et
P.o.box:-46883
2. Ministry of Industry (MoI)
Tel:- 251- (11) -1- 5508775
 www.moti.gov.et
3. Ministry of Health
Te:-251- (11) -1- 5517011
Email:- moh@ethionet.et
www.moh.gov.et
4. Ethiopia Investment Agency (EIA)
Tel:- 251- (11) -1- 5510033
Email:- Ethiopia.invest@ethioinvest.org
www.ethioinvest.org
5. Food, Medicine and Health care Administration and Control Authority (FMHACA)
Tel:- 251- (11) -1- 5522750
www.daca.gov.et
6. Pharmaceuticals Fund and Supply Agency (PFSA)
Tel: -251- (11) -1- 275
Email: pfsa@ethionet.et
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