The Sunday News
Robin Muchetu, Senior Reporter
PHARMACEUTICAL manufacturer Datlabs is courting an Iranian investor to rehabilitate its Large Volume Parenterals (intravenous fluids) line that has the potential to generate close to US$4 million in revenue annually.
Datlabs discontinued the LVP line in 2006 due to the unavailability of a market for its products as the largest customer, the public health sector got a huge donation stock of the fluids and stopped taking up the products from the Bulawayo based company.
The country is now importing the fluids that are used in public hospitals.
In an interview, Datlabs chief executive officer Mr Admire Nyika said the IV fluids plant was shut down and they are working on reviving it.
“Unfortunately, the plant was closed as far back as 2006. It has not been operational since then. The major reasons that led to the closure of that plant then was limited uptake from the public sector. So when you look at Zimbabwe in general, your biggest client is the public sector. So if they are not buying from you, you are in trouble. These Large Volume Parenterals are what we call sterile products.
“The level of running that plant, from a cost perspective and compliance is quite high because these are injected into the body, they need to have a certain level of purity. So you have a very expensive plant to run, which you cannot stop. It has to be continuously lit and air-conditioned, but no one was taking the product,” said Mr Nyika.
Mr Nyika said there was an estimated annual revenue of US$3 million from the local market and US$500 000 from the export market if the plant resumes operations and supplies the IV fluids to health institutions locally.
He said when their plant was operational, the Government along the way, got a big donation of almost two to three years’ worth of stock so they could not procure the fluids from Datlabs.
Another issue that affected the company was that of failing to get payments on time.
“So the turnaround in terms of payment was also not as good. So I think those were the two major issues, the access to the market and the payment cycles, which were not sustainable. Following this we could not further upgrade our facilities because of our failure to get payment on time, we were dealing with very old equipment that was no longer compliant and we needed money yet we did not have the market for the product anymore,” he said.
Mr Nyika, however, said Datlabs has the capacity for a new IV fluid plant if there is guaranteed uptake of the products.
“We have enough space to build a plant that can match the requirements of the country, we used to do it in the past and we can still do it. There has to be some form of guaranteed uptake of the products. Government has restricted about 23 products that are locally produced from importation, if such a commitment can be put on the table, it can make business sense to look at that project again. We ask to be treated as an important national project of interest for everyone, if you have diarrhoea and all these other diseases, the first thing that somebody is given are those IV fluids, we cannot wait for them to come from South Africa,” he said.
Diarrhoea virus
Mr Nyika said the management of Datlabs had an engagement with an Iranian company over the resuscitation of the IV plant.
“We had a conversation with an Iranian company two weeks ago, they also thought that the plant was running but we showed them what we have and what can be done. They had a meeting with Natpharm in Harare at the invitation of the Government and they then invited the local industry and they asked us what our plans were with the plant. We told them if they were working with Natpharm and there was a guarantee to take up the product, we have the expertise and the laboratories and we can take up that project. It is something that is under discussion, they are interested in manufacturing products locally,” he said.
The company has, however, managed to stay on course following the takeover by new management and has retained its staff complement despite the closure of the IV fluids section.
Mr Nyika said they were increasing productivity to match increased operating costs and staff increases following the closure of some of its lines adding that they were doing all they could to retain staff including paying competitive salaries and incentivising their employees.–@NyembeziMu
