Aspen Faces Challenging Year Ahead

Considering the limitation on the prices increase of private-sector drugs this year, Aspen Pharmacare is expecting more challenges in the year ahead.

Aspen Pharmacare has warned investors that the company's major business faces challenges in the year ahead as it could be affected either by the government-enforced reduction on AIDS drug prices or the South African Government's decision to freeze prices on medicines.

The government told pharmaceutical companies that they cannot increase the prices of private-sector drugs this year. This is the second blow it has dealt to Aspen, after the government negotiated lower prices for its two-year AIDS drug contract, of which Aspen hold 41%.

The pharmaceutical firm will also face increased competition from generic versions of Truvada, a key product its portfolio.