(Bloomberg) — Aspen Pharmacare Holdings Ltd. is in talks with Johnson & Johnson to increase production of Covid-19 vaccines and evaluate a potential license for Africa’s biggest drugmaker, positioning itself for further developments in the inoculation sphere.
The discussions are underway as the African Union and European Union look to bolster the supply of coronavirus vaccines to the continent, and could extend an existing agreement for Aspen to package and fill vials of the U.S. company’s vaccine at a plant in South Africa.
“Aspen is hopeful that the current discussions between Johnson & Johnson and Aspen, including a possible license for Africa, could make a meaningful contribution to improving equitable Covid-19 vaccine access for the continent,” Chief Executive Officer Stephen Saad said in a statement.
Aspen shares rose 2.3% as of 9:09 a.m. in Johannesburg Thursday, and have gained more than 54% this year.
South Africa is heavily reliant on the single-dose J&J shot as it looks to inoculate as many of its 40 million adult population as possible this year. Most nations elsewhere on the continent are further behind when it comes to vaccine rollouts, raising the risk of the emergence of dangerous new variants.
Aspen switched focus to producing so-called steriles such as anesthetics a few years ago to tap a higher-value market than its traditional generic medicines, paving the way for a push into vaccines. Gaining a license would allow Aspen to produce a fully-owned African Covid-19 shot manufactured locally, easing a dependence on other nations.
Earlier this year, a batch of about 2 million J%J doses destined for South Africa had to be thrown out following a U.S. manufacturing glitch.
Aspen resumed paying dividends after a two-year pause, the Durban-based company said. The drugmaker also slashed debt to 16.3 billion rand ($1.1 billion) as of the end of June, from 35.2 billion rand a year earlier, following the sale of the European thrombosis business.
(Updates with share price in fourth paragraph)
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