The man who built one of the world’s biggest pharmaceutical companies in South Africa

Stephen Saad is the CEO of South Africa’s largest pharmaceutical business, Aspen Pharmacare. The company has grown into a R75 billion behemoth with operations in over 150 countries.

Saad was raised in Durban and completed a bachelor of commerce degree at the University of KwaZulu-Natal. He went on to qualify as a Chartered Accountant.

Despite making his name in the pharmaceutical business, Sadd started his career at Coopers & Lybrand, where he completed his articles.

He would later move to Quickmed, a prescription drug distribution company, where he worked as a rep in South Africa’s townships.

He was instrumental in convincing Quickmed to avoid a sale, stating that intellectual property ownership would be the best way to save and grow the business.

He became a 50% shareholder and identified Covan, an eye-drop company, as an acquisition target. The two companies would go on to form Zurich.

Adcock Ingram, then known as Prempharm, saw Zurick as a threat and acquired it for R75 million, which pocketed Saad R20 million when he sold his shares.

Before re-entering the pharmaceutical game, Saad, who was a millionaire before he turned 30, participated in a takeover of Varsity College, which was bought for R1.5 million.

The private “university” was poorly run and faced closure within six months. Saad and his business partner Gus Attridge dismissed the founder and restructured the overhead base.

The group would then sell Varsity College for R100 million later.

Stephen Saad founded South Africa’s largest pharmaceuticals maker, Aspen Pharmacare, in 1997.

Aspen and other successes

Saad founded Aspen in 1997, focusing on buying licences for non-core brands from large multinationals.

With larger players happy to offload their non-essential assets, Aspen recorded R105 million in revenue in its first year.

Aspen would also start acquiring intellectual property like patents and trademarks while avoiding the high manufacturing costs.

However, this would change through the highly leveraged R2.4 billion takeover of South Africa’s oldest pharmaceutical company, South African Druggist, which was involved in pharmaceutical development.

By 2003, Aspen launched the first generic ARC in Africa. Aspen remained an essential player in fighting HIV across South Africa, signing several large contracts with the government.

Aspen continued its acquisition spree, acquiring Cape Town-based Fine Chemicals in 2004. Fine Chemicals was South Africa’s only manufacturer of active pharmaceutical ingredients.

Aspen also expanded internationally, acquiring Royal Numico, a Dutch-based infant nutritional brand, in 2004. It then expanded to Latin America via several acquisitions in Brazil, Mexico, and Venezuela.

In 2011, Aspen acquired the largest Australian-owned pharmaceutical business, Sigma Pharmaceuticals, for R5.9 billion.

Three years later, Aspen entered into a R12 billion agreement with GSK to acquire the Arixtra and Fraxiparine/Fraxodi thrombolytic brands worldwide and a sterile production site in France.

The group would also acquire the exclusive rights to commercialise AstraZeneca’s global anaesthetics portfolio in 100 countries worldwide, excluding the USA.

During the COVID-19 pandemic, Aspen also announced that it entered into a licensing agreement with Johnson & Johnson to produce its vaccine.

The company’s growth over the last two decades has seen it market generic medicines in 150 countries, with Saad benefitting handsomely.

With a 12.82% stake, Saad’s share of Apsen is worth roughly R930 billion. His net worth has dropped substantially in recent years, declining from the $2.1 billion (R24 billion) figure in 2015 from Forbes.

This follows disappointing financial results for the group, especially in the most recent financial year.

Although the group’s revenue increased by 10% to just under R45 billion, net income decreased by 16% to R4.40 billion. Earnings per share (EPS) also increased from R11.77 to R9.91.

Despite the recent drop in the value of his stake in Aspen, he has still earned large amounts from historic dividends. He also owns a large private game reserve at Sabi Sands next to the Kruger National Park.

Saad is the chair of The Sharks rugby team from Durban and serves as a board trustee to his alma mater Durban High School.

Amidst his business successes, Saad received an honorary doctorate from Nelson Mandela Metropolitan University in 2014.

Apsen’s success led to Saad being named Entrepreneur of the Year at the All Africa Business Leaders Awards in 2016.