Cipla invests R185 million in new distribution centre

Cipla invests R185 million in new distribution centre

Cipla Medpro (Cipla SA), the third largest pharmaceutical manufacturer in South Africa, yesterday launched its new, purpose built 16 000 M2 pharmaceutical distribution centre (DC) in Parklands, Cape Town.

The pharmaceutical company invested R150-million in the construction of the DC, named Cipla Distribution Gateway, as well as R35-million in equipment to support its operation.

This is according to Paul Miller, CEO of Cipla SA, who says that the construction of the DC is yet another building block in the pharmaceutical company’s quest to increase access to affordable medication for all South Africans. “Cipla Distribution Gateway will bring us closer to reaching the estimated 44-million patients in need of healthcare and not just the 8-million patients who are privately insured.”

As a testament of Cipla’s commitment to improve healthcare in South Africa, Cipla global invested 4.5-billion into the country as one of the biggest foreign direct investments into South Africa in 2013, explains Miller.

“In addition to the DC, we also recently upgraded our 23 000 square meter manufacturing facility, Cipla Medpro Manufacturing – headquartered in Durban, KwaZulu-Natal. In total R400-million was invested in its local manufacturing facility. The net effect of this investment and best manufacturing practices that were implemented as a result, moved the facility from a R110-million deficit to a profit of R35-million this year.”

He adds that as a top five supplier of HIV medication to the public sector and a longstanding partner of Government and the national Department of Health (DoH) in the distribution of medication, the organisation is constantly finding ways to improve its service delivery. “Each month we distribute over 4.5-million units of pharmaceutical products to the various Government depots, clinics and hospitals nationwide, and this new facility will further enable us to improve delivery times, house more stock and subsequently be a better partner to the DoH.”

Miller says that the decision to invest in this local DC was supported by the pharmaceutical company’s 44% year-to-date growth and its forecasted full year growth of greater than 20%. “The construction of the DC also supports our core corporate objective of placing a Cipla product within one kilometer of every South African in need of medication.”

Miller points to Cipla’s recent exclusive agreement with the world’s largest vaccine manufacturer, Serum Institute of India (SII), which is aimed at ensuring affordable and accessible vaccines for South Africans, and to facilitate a reliable supply stream of vaccines to the South African Government. “The vaccines that form part of this agreement will also be stored and distributed via Cipla Distribution Gateway.

He adds that the DC still employs 72 staff members and will achieve a level 2 Empowerdex BBBEE rating. “With a warehouse capacity of 22 000 pallets, this state-of-the-art storage facility is expertly designed to meet stringent climate control regulations and a great deal of consideration also went into making this new facility a ‘happy’ space for our staff,” concludes Miller.

To celebrate the launch of the distribution centre, Cipla’s Chairman, Dr Yusuf Hamied – known as the pioneer of fixed dose combinations for the treatment of HIV/Aids – travelled from Cipla headquarters in India to attend the official opening of Cipla Distribution Gateway.


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