BUSINESS DAY NATIONAL, COMPANIES & MARKETS 06 Jun 2006 Page 16

Eli Lilly sells SA insulin provider


Science and Health Editor CAPETOWN Multinational drug maker Eli Lilly has sold its local insulin sales and marketing business to a black-owned firm, Batswadi Pharmaceuticals.

Batswadi is headed by Eli Lillys former SACEO, Chris Whitfield. This deal, worth R66,5m, will ensure that Eli Lilly is compliant with governments black economic empowerment policy.

Government targets for black ownership in the pharmaceutical sector are due to be outlined in a forthcoming health-care charter.

This has not yet been finalised.

Whitfield, who owns a 40% stake in Batswadi, said that 31% of the companys equity was in the hands of various disadvantaged groups, including blacks, women and disabled people.

DEC Investment Holdings, the investment arm of the Disability Empowerment Concerns Trust holds 20% of the companys shares. The trust is owned by seven organisations representing 4,8-million disabled South Africans, 85% of whom are black.

Batswadis black women workers own 6% of the shares, and 5% are held by noriexecutive directors.

The remainder of the shares are held by an investor who Whitfield declined to name.

The deal was 80% financed by Standard Bank, and the remainder was financed by Batswadis mystery angel investor, said Whitfield.

Eli Lilly SA MD Jim Ringer said: This (deal) is related to Eli Lillys efforts to become a blackempowered company in SA. We are here for the long term. In terms of the deal, Batswadi will take over local distribution and marketing of Eli Lillys insulin products. It will not manufacture the products. The partnership between the two firms is renewable after 10 years, and 18 of Eli Lillys staff have been transferred to Batswadi.

Lilly, founded in 1876, produced the first commercially available insulin more than 80 years ago. The drug is used to treat diabetes, which is estimated to affect between 2,5-million and 3-million South Africans, a third of whom are undiagnosed.

Whitfield said diabetes had reached epidemic proportions~ The Disability Empowerment Concerns Trusts beneficiaries are: the Thabo Mbeki Development Trust for Disabled People; The Deaf Federation of South Africa; Disabled People South Africa; the National Council for Persons with Physical Disabilities in South Africa; the South African Federation for Mental Health; the South African National Council for the Blind; and Epilepsy SA.