Cipla Mobilizes to Secure South Africa’s Critical HIV Treatment Supply Amid Pharmaceutical Crisis

South Africa’s antiretroviral drug supply chain faces unprecedented uncertainty following the business rescue proceedings of two major pharmaceutical suppliers, prompting Cipla Medpro South Africa to mobilize resources and expand manufacturing capacity to prevent treatment disruptions for the nation’s eight million people living with HIV.

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The Supply Chain Crisis Unfolds

In December 2025, Avacare Health subsidiaries—Barrs Pharmaceuticals Industries and Innovata Pharmaceuticals—entered business rescue after accumulating debt exceeding R250 million to suppliers. The companies, which between them had won approximately 28.76 percent of the contract for three-monthly packs and 24.49 percent for monthly packs of the critical TLD regimen, failed to notify the Department of Health of their financial distress or their inability to meet contractual obligations.

The timing could not be more critical. The national ARV tender, valued at an estimated R15.5 billion over three years, supplies antiretroviral medications to millions of South Africans dependent on uninterrupted treatment. The tenofovir/lamivudine/dolutegravir (TLD) component alone accounts for approximately R12.6 billion of the total tender value, representing the backbone of South Africa’s HIV treatment program.

According to Statistics South Africa, approximately eight million people—12.7 percent of the population—are living with HIV in the country. For this vulnerable population, any supply disruption creates immediate risks of developing drug resistance and adversely affecting health outcomes, potentially reversing decades of progress in managing the epidemic.

Manufacturing Constraints and Regulatory Violations

The crisis extends beyond financial distress. Barrs Pharmaceuticals’ Cape Town manufacturing facility has been shuttered since September 2025 after failing to rectify problems repeatedly flagged by inspectors from the South African Health Products Regulatory Authority (SAHPRA). Routine SAHPRA inspections in 2021 and 2023 identified deficiencies in contamination and cross-contamination controls that posed potential risks to product safety and quality.

When officials visited the facility again in August 2025, the problems remained unresolved. SAHPRA consequently issued a directive instructing Barrs to cease manufacturing activities and quarantine all products manufactured at the non-compliant facility. The company submitted a corrective action plan in January 2026, but approval remained pending as of early February.

Department of Health spokesperson Foster Mohale confirmed that both suppliers have been experiencing manufacturing constraints affecting their ability to supply, with stock shortages extending beyond HIV medicines to multiple other pharmaceutical items. Neither Avacare nor its subsidiaries notified the department when they entered business rescue on December 9, 2025—a move that caught customers, including the Independent Community Pharmacy Association and the Association of Palliative Care Practitioners, by surprise.

Cipla’s Strategic Response and Manufacturing Capacity

Against this backdrop of uncertainty, Cipla Medpro South Africa has publicly reaffirmed its commitment to providing an uninterrupted supply of critical antiretroviral medicines to the Department of Health. Paul Miller, CEO of Cipla Africa, emphasized the company’s readiness to support the government’s efforts to maintain stability in the ARV supply chain.

“Cipla confirms its willingness to support national requirements under the current tender agreement and, if needed, contribute meaningfully to any supplementary procurement processes to safeguard patient access to essential treatment,” Miller stated in a company announcement.

The pharmaceutical manufacturer has been producing TLD for the South African government for the past seven years, establishing a proven track record in manufacturing this critical triple-combination therapy. The company’s existing infrastructure and regulatory approvals position it to rapidly scale production in response to the current emergency.

Cipla has undertaken substantial investments in its local manufacturing capabilities specifically to ensure supply continuity. The company has upgraded its ARV production line capacity, installed a new Countec bottle line, and increased its tablet filling capacity by 190 percent. These enhancements have elevated the facility’s annual production capacity to approximately 475 million tablets.

“We have mobilised resources to help maintain equitable access to quality, affordable critical medication,” Miller said, emphasizing Cipla’s commitment to caring for life—the company’s foundational ethos that has guided its operations for over eight decades.

Cipla’s Legacy in HIV Treatment Access

Cipla’s intervention in South Africa’s current crisis builds on a remarkable legacy of expanding access to affordable HIV treatment across the developing world. In 2001, the company made history by offering a triple antiretroviral therapy combination at less than one dollar per day in Africa, compared to the prevailing cost of $12,000 per patient per year for branded medications. This paradigm-shifting offer is widely acknowledged as having transformed HIV from a death sentence into a manageable chronic illness for millions across the developing world.

Through its Cipla Global Access (CGA) initiative, the company has championed access to quality, affordable medicines through more than 1,500 products across 65 therapeutic categories in over 50 dosage forms. For more than two decades, antiretroviral drugs have been made available to patients around the developing world at affordable prices, with Cipla leading the development of paediatric fixed-dose variations of ARV treatments specifically designed for children.

The company’s commitment extends to developing innovative formulations that address real-world challenges in resource-limited settings. In 2022, Cipla and the Drugs for Neglected Diseases initiative (DNDi) launched a sweet-tasting, heat-stable ‘4-in-1’ fixed-dose combination specifically designed for infants and young children with HIV. The formulation, which does not require refrigeration and is easy to administer to children of different weights and ages, represents a major improvement over previously available treatments that contained 40 percent alcohol content and required cold chain storage.

The Broader Context: South Africa’s HIV Epidemic

South Africa remains at the epicenter of the global HIV pandemic. With an estimated 7.7 million people living with HIV—representing roughly one-fifth of all HIV cases worldwide—the country faces the largest absolute number of HIV infections globally, despite not having the highest prevalence rate on the continent.

The scale of the epidemic necessitates one of the world’s largest antiretroviral therapy programs. According to the U.S. Centers for Disease Control and Prevention, CDC supports antiretroviral therapy treatment for over 2 million people living with HIV in South Africa, representing 33 percent of the 6 million people who are on ART in the country. By the end of fiscal year 2024, an estimated 96 percent of people living with HIV knew their status, and 81 percent of them were receiving ART.

Progress toward the UNAIDS 95-95-95 targets—that 95 percent of people living with HIV know their status, 95 percent of those diagnosed receive antiretroviral therapy, and 95 percent of those receiving ART achieve viral suppression—has been substantial but remains incomplete. Approximately two million people with HIV are still not receiving the lifesaving treatment they need, underscoring the critical importance of maintaining an uninterrupted drug supply chain.

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The Tender Controversy and Political Fallout

The current crisis has reignited controversy surrounding the tender award process itself. Several established pharmaceutical companies, including Adcock Ingram, Cipla, and Sun Pharmaceuticals, were excluded from the original tender award. Shortly after the contracts were announced, Hetero Drugs’ South African subsidiary launched legal action against the Department of Health, alleging it had been unlawfully excluded from the contracts despite offering lower prices than all but one of the successful bidders.

The Competition Commission subsequently launched an investigation into Hetero for alleged collusion, triggered by a referral from the health department. The complexity of these competing legal claims and investigations has added further uncertainty to an already volatile situation.

The Democratic Alliance has written to Health Minister Dr. Aaron Motsoaledi demanding urgent accountability for the procurement oversight, supplier vetting, and risk management failures that allowed financially distressed companies to win such critical contracts. Faith Muthambi, Chair of Parliament’s Portfolio Committee on Health, has indicated that the committee will require the Minister to appear before Parliament to explain how the situation arose and what it means for patients.

“We need to get to the bottom of this as a matter of urgency,” Muthambi stated, reflecting broader concerns about the governance of pharmaceutical procurement in South Africa’s public health system.

Recent Developments and Path Forward

The business rescue process for Avacare and its subsidiaries has moved rapidly. Business rescue consultant Karl Gribnitz indicated that all three companies were expected to exit business rescue by the end of January 2026, with two groups of investors intending to recapitalize the companies once the process is complete. Creditors have been offered up to 50 cents in the rand under the restructuring plans.

In a significant development, Barrs exited business rescue in early February after selling control to Hetero South Africa—ironically, the same company that had launched legal action against the Department of Health for being excluded from the tender. The Department of Health has granted approval for Barrs to supply Hetero South Africa’s products at the price set out in the original tender award, with outstanding AIDS drug stocks scheduled to be delivered on or before February 10, 2026.

This development marks an uptick in Hetero South Africa’s fortunes and provides some assurance that critical drug supplies will be maintained. However, concerns remain about Barrs’ shuttered manufacturing facility and whether SAHPRA will approve the company’s corrective action plan, allowing production to resume.

The Local Manufacturing Imperative

Miller emphasized that the current crisis presents an opportunity to advance the government’s commitment to strengthening local manufacturing capacity. “By ensuring greater support for locally produced medicines, future allocations could meaningfully contribute to South Africa’s industrial development agenda while maintaining continuity of supply,” he stated.

The argument for robust local pharmaceutical manufacturing extends beyond economic development considerations. Supply chain resilience, particularly for critical medications like antiretrovirals, requires domestic production capacity that can respond rapidly to disruptions without depending on international suppliers or complex logistics chains.

Cipla’s investments in expanding its South African manufacturing capabilities—including the 190 percent increase in tablet filling capacity—demonstrate the company’s long-term commitment to the South African market and its willingness to serve as a strategic partner in ensuring medication security for the nation’s most vulnerable populations.

Implications for Patient Care and Public Health

The potential for supply disruptions carries grave implications for individual patients and public health outcomes. People living with HIV require uninterrupted access to antiretroviral therapy to maintain viral suppression. Even brief treatment interruptions can lead to viral rebound, development of drug resistance, and progression to AIDS.

Research in rural South Africa has documented the emergence of drug resistance even under current treatment protocols, with widespread resistance to older HIV medications detected in community surveys. The introduction of newer drugs like dolutegravir has been specifically intended to address these resistance patterns, making continuity of supply for TLD regimens particularly critical.

Moreover, the success of South Africa’s HIV treatment program has broader implications for the southern African region and global efforts to end AIDS as a public health threat by 2030. Mathematical modeling studies suggest that maintaining high treatment coverage and viral suppression rates is essential to sustaining the declining incidence of new HIV infections that has been achieved through intensive interventions over the past decade.

Beyond ARVs: Broader Medicine Shortages

The problems at Barrs and Innovata extend beyond antiretroviral medications. Barrs Pharmaceuticals serves as South Africa’s sole importer of bulk morphine hydrochloride, which pharmacists repackage and prepare as syrup for use in both public and private healthcare sectors. The company’s business rescue proceedings led to nationwide shortages of morphine powder—not the first time such disruptions have occurred, as similar shortages were reported in 2022.

The Department of Health confirmed that stock shortages of multiple items from both Barrs and Innovata have affected the broader pharmaceutical supply chain, raising questions about over-reliance on a limited number of suppliers for critical medications and the need for greater redundancy in procurement strategies.

The Role of Alternative Suppliers

In response to the crisis, the Department of Health has engaged with other awarded suppliers to increase their production and ensure continuous availability of medicines while Barrs and Innovata address their supply constraints. Aspen Pharmacare, another major pharmaceutical manufacturer in South Africa, has indicated its willingness to step in to fill supply gaps.

Aspen has a long history of supplying antiretroviral medications to South Africa’s public health system. The company was one of the first generic manufacturers awarded contracts to supply ARVs when South Africa’s HIV treatment program launched in earnest in 2005, and it has maintained a significant role in the country’s pharmaceutical landscape ever since.

The involvement of multiple suppliers, including Cipla, Aspen, and potentially Hetero through its acquisition of Barrs, may ultimately strengthen the resilience of South Africa’s ARV supply chain by distributing risk across multiple manufacturing facilities and corporate entities.

Conclusion: A Test of Pharmaceutical Governance

The current crisis represents both an immediate emergency requiring rapid response and a longer-term challenge to South Africa’s pharmaceutical procurement and supply chain management systems. The failure of supplier vetting processes to identify the financial distress at Avacare and its subsidiaries, the exclusion of established manufacturers from the tender process, allegations of collusion, and the regulatory violations at Barrs’ manufacturing facility all point to systemic weaknesses that require urgent attention.

Cipla’s commitment to expanding production and ensuring continuity of supply demonstrates the critical role that established pharmaceutical manufacturers with proven track records can play in stabilizing the system during crises. The company’s investments in local manufacturing capacity, its decades-long commitment to affordable access to HIV medications, and its willingness to step forward during this emergency all underscore the value of partnerships between government and reliable pharmaceutical suppliers.

For the eight million South Africans living with HIV, the resolution of this crisis is not an abstract policy question but a matter of life and death. The mobilization of resources by Cipla and other suppliers, combined with the restructuring of the distressed companies and increased oversight from Parliament and regulatory authorities, offers hope that the immediate threat to treatment continuity can be averted.

However, the longer-term imperative remains: building a pharmaceutical procurement and supply system that can reliably deliver critical medications without the kinds of disruptions that have characterized the past several months. This will require not only robust supplier vetting and contract management but also strategic investments in local manufacturing capacity, diversification of supply sources, and regulatory systems that can ensure product quality while supporting the growth of a sustainable domestic pharmaceutical industry.

As South Africa works toward the UNAIDS goal of ending AIDS as a public health threat by 2030, the stability and resilience of its antiretroviral supply chain will be fundamental to achieving that ambition. The current crisis, while alarming, may ultimately serve as a catalyst for the reforms and investments necessary to build a more secure foundation for the decades of HIV treatment that will be required in the years ahead.

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By: Montel Kamau

Serrari Financial Analyst

10th February, 2026