Australia’s top generic drug maker offers to make life saving medicines locally
Medicine supplies are under pressure because of COVID-19 lockdowns around the world. Now Dennis Bastas, head of Australia’s largest generic drug company, has offered a solution.
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Australia’s largest generic medicine company has offered to set up a local drug manufacturing plant after the COVID-19 pandemic exposed Australia’s dangerous reliance on India and China for life saving treatments.
The offer comes as the medicines regulator is doing a stocktake of which medicines are in the country to prevent any shortages as global supply chains come under pressure from COVID-19.
Dennis Bastas, Chairman and CEO of Arrotex Pharmaceuticals, supplies the drugs for one in every three prescriptions filled under Australia’s Pharmaceutical Benefits Scheme.
He holds the intellectual property rights to 250 of the most used medicines in Australia and a half of all the generic medicines sold in this country are made by his company.
But he has revealed 70 per cent of Australia’s most commonly used medicines are produced in India and 80 per cent of the raw ingredients needed for that manufacturing are made in China.
A few weeks ago when India restricted exports of 26 key medicines there were fears it could have a major impact on Australia’s medicines supply at the same time as patients were panic buying from pharmacies.
India’s COVID-19 lockdown saw many of the staff at pharmaceutical factories sent back to their home towns and manufacturing plants are now only working at 50 per cent of their normal capacity.
In a further complication, 60 per cent of Australia’s medicines supply comes into the country aboard passenger flights and most of these have been stopped as a result of international border closures.
The International Generic and Biosimilar Medicines Association (IGBA), this week appealed for effective “green lanes” around the world to enable medicine supplies to get through.
Medicines Australia chief Elizabeth de Somer said pharmaceutical companies were urging governments not to quarantine airline staff entering Australia because it could affect medicine supply.
There were currently no COVID-19 drug shortages but Australia’s medicines regulator was gathering data on critical medicines supply to identify in advance if any shortages were likely to emerge so the problem could be headed off, she said.
Mr Bastas said India’s restrictions did not affect his supply chain as they did not apply to drugs made for export contracts and this week he received a large shipment of medicines.
“We and the other two (generic) suppliers have not seen deliveries impacted even though those came from overseas sources but it’s not to say there won’t be another similar event and we could be left high and dry,” he said.
This week, at a special board meeting, Australia’s generic drug companies discussed ways of ensuring medicine supply now and in a future pandemic.
News Corp also learned the Federal Department of Health is engaging in initial discussions on possible approaches.
Among the options are having the government subsidise the establishment of a local manufacturing plant that could make lifesaving medicines.
Mr Bastas said he holds the intellectual property for 250 of Australia’s most commonly used medications and would be happy to work with the government.
“That would certainly be something I personally would be prepared to have a conversation about,” he said.
“My heart would be in it because I never want to see us as a country being a vulnerable situation because my kids live here and my grandkids live here.”
Mr Bastas said his company was the only Australian-owned player in the generic medicine space.
Unlike other companies which were based overseas, Arrotex could not be subject to the orders of a US president or a national government like India that decided it wanted to restrict exports in a pandemic, he said.
It would take one to two years to set up such a factory and train workers in the production process.
And while it might produce small amounts for the local market, much of the facility would lie idle like the desalination plant in Sydney and only be switched on if an emergency occurred.
It was simply not economic to manufacture the quantities of medicines Australia needs in a local factory because the price paid by the taxpayer under the Pharmaceutical Benefits Scheme would have to increase fivefold, said Mr Bastas.
Another option would be to build a stockpile of the most commonly used medicines and have generic companies manage that supply so that it did not become out of date.
Any disruption in the supply of essential medicines could be more deadly than a viral pandemic, Mr Bastas said.
If diabetics or heart disease patients couldn’t obtain their medicine the emergency department of our hospitals would be overwhelmed and many would die, he said.
Originally published as Australia’s top generic drug maker offers to make life saving medicines locally