Some stakeholders fear that a revised policy proposed by the SA Health Products Regulatory Authority (SAHPRA), making it mandatory for applicants to submit broad-based black economic empowerment (B-BBEE) compliance certificates when applying for a licence, or face refusal, could be disastrous.
The move could also discourage both local and international operators, said lobby group Sakeliga, which argues that “such actions offer an alarming preview of the drastic consequences of an NHI system in which the state would have the entire medical supply chain under its control”.
“The addition of BEE requirements – a measure with inherently no relevance for the effective supply of medical products – will lead to declines in the quality, affordability, and availability of medical products,” it said.
The draft policy was published by SAHPRA last year, with the organisation circulating a revised policy this month and requesting submissions from stakeholders before 9 September.
Phasing process
Moneyweb reports that in phase one of the policy, SAHPRA intends to refuse the issuing and/or renewal of licences unless certain BEE levels are reached (phase two).
The intention is to ensure it aligns itself “to the provisions of Section 10 (1)” of the B-BBEE Act, says SAHPRA.
Its authority extends to regulating all medicines, biologicals, radiation equipment, and veterinary medicines and medical products, including entities that import and export these.
Under the proposed policy, SAHPRA will “require an applicant to submit its B-BBEE level certificate when applying for a licence” during the first year of implementation.
It will then “verify the B-BBEE level status” of applicants and “should an applicant fail to submit its B-BBEE level certificate, or the certificate not be verifiable, SAHPRA will not issue a licence”.
Basically, it will determine a threshold level for B-BEEE, and after year one, use this criteria to judge whether or not applicants will be granted licences.
Alarm bells
Sakeliga said it would “oppose the draft policy inside and outside the courts” and make a formal submission to SAHPRA during the comment period.
SAHPRA’s “proposed requirements are part of a larger trend to make economic activity subject to the state’s prior approval, in particular approval based on BEE”, it said.
“We see similar efforts in the financial services industry, the real estate industry…in the agricultural industry on issues such as water, and more. In addition to all these issues, Sakeliga is already busy developing the legal groundwork and court applications, to which we will now add the proposed BEE licensing of health products.”
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