Sovereign wealth funds (SWFs) in the Gulf Cooperation Council (GCC) countries are increasingly investing in healthcare and the life sciences to reinforce their local industries and pursue the region’s economic diversification goals. Following the Saudi fund PIF’s launch of CDMO Lifera and Qatar’s QIA biotech investments, the UAE fund ADQ has now created a huge pharma holding, Arcera.
A Global Giant Headquartered in Abu Dhabi
Sovereign wealth fund ADQ, Abu Dhabi’s third-largest with an estimated USD 200 billion in assets, has created Arcera, a global holding company headquartered in Abu Dhabi, in the United Arab Emirates (UAE), consolidating some of its pharmaceutical assets to create one of the region’s largest life sciences firms.
Amassing ADQ’s previous stakes in Egypt’s Amoun, Switzerland’s Acino International and Turkey’s Birgi Mefar Group, Arcera will boast a workforce of over 6,500 people in 90 countries and offer 2,000 branded medicines across neurology, gastroenterology, cardiovascular, pain relief, rheumatology and anti-infectives. In addition, the company’s manufacturing and packaging capabilities include seven sites across the UAE, Switzerland, Ukraine, Estonia, South Africa, Turkey and Egypt.
Despite its already huge scope, Arcena has set out to double its revenue over the next five years, ADQ said in a statement, through M&A, or “value-accretive strategic acquisitions in key markets globally and forging high-impact global partnerships.”
By consolidating its life sciences companies, ADQ is not only pursuing a “strategic evolution.” The company says it is also looking to bolster the Emirates’ life sciences industry, back up the Abu Dhabi Vision 2030, which has pinpointed life sciences, and contribute to efforts to diversify the economy and move away from reliance on oil. “As a unified force, Arcera is positioned to be a significant contributor to Abu Dhabi’s life sciences sector, reflecting our unwavering dedication to improving patient outcomes through groundbreaking solutions while aligning with the Emirate’s diversification goals,” said ADQ’s CEO Hamad Al Hammadi.
To head up the new entity as CEO, ADQ has recruited pharma industry veteran Isabel Afonso, who comes to the venture from Novartis where she has been head of In-Market Brands & Business Innovation and previously held leadership roles at the company’s China affiliate.
“The growing need for high quality and effective medicines lends tremendous importance to building a global life sciences company like Arcera,” Afonso said. “Arcera enables its businesses to accelerate growth plans and enhance integration, as well as further expand and develop capabilities. We are pursuing bold ambitions and work towards becoming a leading global life sciences company that fosters longer and healthier lives while creating value.”
CDMO in Saudi
The creation of Arcera comes after another SWF in the GCC took a strong hold in the pharma sector when Saudi’s Public Investment Fund (PIF) launched the contract development and manufacturing organization (CDMO), Lifera, last year. Lifera too is looking to strengthen the local biopharmaceutical industry, and reinforce Saudi Arabia’s position as a global pharmaceutical manufacturing destination.
According to Yazeed A. Al-Humied, deputy governor and head of MENA Investments at PIF, Lifera intends to partner with leading companies in the sector to localize manufacturing and attract investment to ensure access to medicines and secure their supply.
“Lifera was established in response to a government mandate aimed at bolstering the biotechnology sector, particularly focusing on vaccines and biomolecules, to ensure pharmaceutical security within the country,” Ibrahim Aljuffali, Lifera’s chairman confirmed in a recent PharmaBoardroom interview. “As part of our mandate, we prioritize around 200 priority molecules essential for the national biopharma security agenda.”
Lifera also serves as an early-stage CDMO. “This allows us to accommodate the manufacturing of various molecules and be responsive to specific product requirements within stipulated timelines, ensuring the timely availability of essential medications,” Aljuffali affirms.
Biotech Funding from Qatar
The Qatar Investment Authority (QIA), the tenth largest sovereign wealth fund in the world, has also taken an interest in life sciences, and is looking to advance the Qatar National Vision 2030 through its diverse biotech investments.
QIA has been investing heavily in biotech since 2020 and last year took part in a USD 85 million series B funding round in genomic specialist Ensoma and led a USD 250 million round in the transformative medicine biotech BridgeBio.
The QIA’s biotech investments are geographically and technically varied, and include companies in various stages of development. There are initial public offerings (IPOs), into which QIA has injected USD 728.7 million, seed and series A to C with USD 3.2 billion, and series D to F funding rounds that represent USD 5.8 billion. “We design a portfolio in a way that it is as diversified as possible, in terms of geography but also in terms of sector,” said Mansoor al Mahmoud, chief executive officer of QIA.
