UPDATE 1-Hikma in joint-venture to tap high-growth Ethiopian market

By Paul Sandle

LONDON, Sept 18 (Reuters) - Jordan's Hikma Pharmaceuticals has formed a joint venture with Sheikh Mohammed HusseinAl Amoudi's MIDROC Group to enter the Ethiopian healthcaremarket, where health spending is likely to more than double inthe next few years.

London-listed Hikma said the joint venture, HikmaCure, wouldcreate an Ethiopian operating company, build a localmanufacturing facility and would begin marketing anddistributing pharmaceutical products in Ethiopia.

"Ethiopia is still very underdeveloped in terms of thepharmaceutical market," Mazen Darwazah, executive vice chairmanand chief executive of Hikma's Middle East and North Africabusiness, said in an interview.

"It's a market that has huge potential for growth. We areexpecting an increase in expenditure on healthcare: today is$400 million but we are expecting it in the next couple of yearsto go up to $1 billion."

Ethiopia, Africa's second most populous nation, has seen adecade of double-digit growth, and it has leapfroggedneighbouring Kenya to become sub-Saharan Africa's fifth biggesteconomy.

The country's population of 91 million people is served byjust 5,000 doctors, compared with 40,000 doctors in Egypt for 85million people, Hikma said.

Hikma and MIDROC will provide up to $22.3 million each tothe joint venture, Hikma said.

Hikma manufactures and sells branded pharmaceuticals inMiddle Eastern and North African markets including Algeria,Saudi Arabia and Sudan. It also has a U.S. focused genericsbusiness and an injectables unit.

Jeddah-based MEDROC, which has operations in sectorsincluding petroleum, agriculture, engineering and construction,is a major investor in Ethiopia, where it has based its Africanoperations. The group's chairman, Sheikh Mohammed Al-Amoudi, isof Ethiopian-Yemeni heritage, according to his website, and heis the largest foreign investor in Ethiopia.

Analyst James Vane-Tempest at Jefferies said the jointventure was a positive for the company and it added furthercredibility to its expansion strategy.

"Ethiopia is one of the largest markets in the region and inour view offers strong long-term growth potential," he said.

Shares in the group were up 0.9 percent at 1,036 pence by1016 GMT.