South African tycoon Stephen Saad's Aspen pulls out of making the HIV prevention shot

Aspen Pharmacare, Africa's largest drugmaker, has withdrawn from South Africa's plan to manufacture Gilead Sciences' HIV prevention injection lenacapavir domestically, saying the government would not guarantee it would buy the output.

Stephen Saad, Aspen's founder and chief executive, told Business Day the company had pulled its expression of interest because no purchase volumes were promised to local manufacturers willing to invest in production. "It is off the table for us because no-one's going to promise us volumes," he said, in remarks published on Friday, Sept. 4.

Aspen is instead directing its HIV effort toward alimatravir, an experimental monthly pill from Merck.

Why this matters more than a single contract

Lenacapavir is a long-acting injection given twice a year that prevents HIV infection. Trial results have made it one of the most closely watched products in global public health, and the question of who manufactures it, and at what price, has become the central fight over access in Africa, where the epidemic remains concentrated.

South Africa has been trying to secure a domestic supply rather than importing the drug, and the South African National Aids Council ran an expression of interest process to identify manufacturers able to handle parts of the lenacapavir value chain. Aspen was among a small number of South African companies with the plant capacity to make it. Sterile injectable manufacturing is considerably more demanding than tablet production, which narrows the field sharply.

SANAC said the evaluation has concluded and that it recommended three manufacturers to Gilead, which are now moving into technical assessment. It declined to name them. Business Day reported that Adcock Ingram is not among them. The council said it remains committed to establishing a local manufacturing route for South Africa and the wider Southern African Development Community region.

The commercial logic behind the refusal

Saad's position is a straightforward reading of manufacturing economics. Building sterile injectable capacity for a specific product requires capital committed years before the first vial is sold, and the investment only pays back at volume. A manufacturer that installs that capacity without an offtake agreement carries the entire demand risk.

South African procurement rules make firm multi-year purchase commitments difficult, and the government has been reluctant to guarantee purchases from local producers. That is the gap Aspen has declined to bridge.

The pivot to Merck's alimatravir points at the same calculation from the other side. A monthly oral pill uses manufacturing capability Aspen already has, in a form that is cheaper to produce, easier to distribute and does not require dedicated new sterile lines.

Saad and the company he built

Saad, 62, co-founded Aspen in Durban in 1997 with Gus Attridge and has been chief executive since 1999. He began in pharmaceuticals in 1989 with Quickmed, a prescription drug distributor serving townships under apartheid, and made his first significant money at 29 selling his stake in Covan Zurich.

He remains Aspen's largest individual shareholder with 13.02 percent, or 58,075,716 ordinary shares. At the Sept. 4 close of R150.43 that holding is worth about R8.74 billion, roughly $546 million at approximately R16 to the dollar. Aspen's market value stood at R66.79 billion, about $4.17 billion, and the stock is up more than 48 percent over the past year after a punishing 2025 in which it fell to around R100.

Aspen supplies branded and generic medicines in more than 150 countries and is the dominant supplier in the South African market. Group revenue was flat at R34.9 billion in its most recent results. Its growth case now rests heavily on generic semaglutide, the active ingredient in Novo Nordisk's Ozempic and Wegovy, which it plans to roll out initially through third-party manufacturers including India's Dr Reddy's Laboratories, targeting South Africa, Brazil and parts of the Middle East. It also distributes Eli Lilly's Mounjaro across sub-Saharan Africa.

The company has not said whether its decision on lenacapavir would change if the government offered purchase guarantees.