The Biovac Institute has retained a critical contract to supply the South African state with Hexaxim. Hexaxim is the six-in-one shot provided to infants in the national childhood immunisation programme.
The R5.3bn award was announced in the Department of Health’s next three-year national vaccine tender. This tender is set to begin on January 1, 2027. This contract is vital to Biovac's financial stability. The company relies heavily on state business for its ongoing operations.
Rebuilding Stability After Previous Local Job Losses
The announcement marks a major turnaround for the local manufacturer. Biovac was forced to retrench staff in 2023. This occurred after the Department of Health rejected its pneumonia vaccine. The state chose cheaper imported alternatives from India instead.
While Biovac plans to export vaccines globally in the future, Hexaxim remains key in the short- to medium-term. Biovac CEO Morena Makhoana confirmed this strategic focus. The latest state contract ensures the company can maintain its current workforce and local manufacturing facilities.
Financial Impact of the Biovac Vaccine Tender Success
Biovac won three of the eight available contracts in the broader R8bn state vaccine tender. In addition to Hexaxim, the group secured supply contracts for BCG, which protects babies against TB. It also won the contract for a combined measles-rubella vaccine.
The company imports and packages both the BCG and measles-rubella treatments. However, it provides the final manufacturing step for Hexaxim under a strict agreement with French pharmaceutical giant Sanofi. Biovac is the only firm with a completed technology transfer agreement with Sanofi for the fill-and-finish of Hexaxim. This critical six-in-one shot protects against diphtheria, tetanus, pertussis, hepatitis B, polio, and Haemophilus influenzae B.
Market Risks and Dropping Demand Volumes
Despite the Biovac Vaccine Tender Success, Makhoana cautioned that the full value of the tender might not be realised. This is due to rising concerns about declining immunisation coverage across South African clinics.
Biovac currently receives provincial orders for about 4 million doses of Hexaxim annually. This is significantly lower than the quantities anticipated in the official state tender documents. The state expected to need 16.5 million doses over three years, averaging 5.5 million doses per year.
Competitors Secure Remaining State Vaccine Shares
Other pharmaceutical companies also secured substantial wins in the R8bn state tender. The local subsidiary of Indian generic drug manufacturer Cipla won contracts worth a combined R1.1bn. Cipla will supply vaccines against pneumonia, rotavirus, and hepatitis B.
Cipla South Africa CEO Paul Miller stated the tender reaffirms their partnership to ensure access to affordable healthcare. Notably, Cipla’s rotavirus shot will cost R30 per dose. This is nearly half the R58 price of the current GlaxoSmithKline product. Meanwhile, GlaxoSmithKline secured two contracts worth R1.59bn to supply shots against the human papillomavirus and a combination booster for diphtheria, tetanus, and whooping cough.
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