Project detail - Zanzibar Pharma Limited

Zanzibar Pharma Limited

Status: Proposed investment
Back to map

Disclaimer

The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion.

In case of questions

This proposed investment is online for 30 days. In case of questions, please contact disclosure@fmo.nl

Who is our prospective client?

Zanzibar is a newly incorporated buy and build platform for the acquisition of pan-African biopharmaceutical businesses as well as a manufacturing and innovation center of excellence in India. It is designed to compete in large, fast growing and differentiated therapeutic areas through innovation and cost leadership. FMO is planning to co-invest in this platform alongside ADP III, a private equity fund advised by Development Partners International (DPI). ADP III is a pan-African focused private equity fund, in which FMO invested in 2020.

What is the funding objective?

The platform has received an initial $250 million in capital from its founding investors, ADP III, CDC Group, and the European Bank for Reconstruction and Development, that have been used to fund the acquisition and combination of Adwia Pharmaceuticals, an Egyptian generic drugs manufacturer, and Celon Laboratories Pvt, an Indian oncology and critical care specialist. The platform will leverage its manufacturing and R&D center of excellence in India to strengthen its local manufacturing operations in Africa, while capturing synergies from centralized supply chain management and business development. The newly created platform will improve the delivery of essential and affordable specialty generic pharmaceuticals across the African continent. This will be supported by up to an additional $500 million fund raise, in which FMO targets to participate, to fund a strong pipeline of acquisitions, assist in new drug development, and establishment of new distribution channels.

Why do we want to fund this project?

An investment in Zanzibar aligns strongly with FMO’s strategy to deepen relationships with existing partners and contribute to improving affordability and availability of drugs in Africa. This is the first of its kind Pan-African pharma platform and will generate significant cost savings for healthcare providers across Africa and broaden range of therapeutics available in underserved markets. The platform earmarked a strong pipeline within its existing product portfolio for the potential introduction of over 85 life-saving drugs across the continent at affordable prices.

Environmental and social rationale

The E&S categorization of Zanzibar is B+ based on the current assets in the platform and pipeline/strategy. E&S issues associated with pharmaceuticals formulation and distribution operations are site specific and can be addressed through known and available mitigation practices. IFC PS 1 is applicable, as for the management of the E&S matters, and ESMS is needed both at platform level as well as asset level. IFC PS 2 is applicable, due to risks related to labour and working conditions. IFC PS 3 is applicable due to risk of environmental contamination during production, as well as management of waste, including hazardous waste and asbestos. IFC PS 4 is applicable due to matters related to community engagement, well-functioning grievance mechanism and security. IFC PS 5 is not expected to be triggered as no involuntary resettlement is foreseen. IFC PS 6 is not triggered, as there are no impacts to biodiversity in the current assets. IFC PS 6 could potentially be triggered for future assets, on issues related to testing of new drugs. IFC PS 7 and IFC PS 8 are not triggered, as the operations do not impact Indigenous People or Cultural Heritage.

Region
Africa
Country
Saudi Arabia
Sector
Infrastructure, Manufacturing and Services
Publication date
3/25/2021
Total FMO financing
USD 25.00 MLN
Fund
FMO
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
B+