Setting Up a Pharmaceutical Manufacturing Business in Kenya: A Legal Guide

Kenya imports most of the medicines sold within its borders, and government policy is now pushing hard in the opposite direction, toward local manufacture of essential medicines. For an investor or existing manufacturer, that push translates into a specific, multi-layered legal process at the Pharmacy and Poisons Board (PPB) and several other regulators. Setting up a pharmaceutical manufacturing business in Kenya requires at least three distinct approvals that are often confused with one another: a licence authorising the business to manufacture at a particular facility, a separate registration for each individual medicinal product the business intends to sell, and clearances from other bodies covering the environment and general product standards. Treating the manufacturing licence as if it were the same thing as product registration is one of the most common and costly mistakes investors make, since a fully licensed factory still cannot lawfully sell a single tablet until that specific product has been registered on its own merits. This guide sets out the legal framework governing each stage, from the Pharmacy and Poisons Act itself through to the incentives now available to local manufacturers.

The Pharmacy and Poisons Act and the Role of the Pharmacy and Poisons Board

The Pharmacy and Poisons Board is established under section 3 of the Pharmacy and Poisons Act (Cap 244). Its chairperson is appointed by the President and must be a registered pharmacist of good standing holding a degree in pharmacy with at least ten years’ experience in the sector, while other members are appointed by the Cabinet Secretary from among persons nominated by the relevant professional associations. The Board’s functions extend well beyond issuing licences. Under section 3B it is required to maintain a register of all authorised medicinal substances and to publish, at least once every three months, lists of medicinal substances and products that hold marketing authorisation. In practice, the Board is the single point of contact for almost every stage of setting up a pharmaceutical manufacturing business, from inspecting the factory to evaluating each product dossier and monitoring the market once the business is operating. Anyone planning to manufacture medicinal substances in Kenya should expect sustained, ongoing regulatory contact with the Board rather than a one-off licensing exercise.

The Manufacturing Licence and Good Manufacturing Practice Certification

The starting point for the manufacturing side of the business is section 35A of the Act, which provides that “no person shall manufacture any medicinal substance unless he has been granted a manufacturing licence by the Board.” An applicant must apply in the prescribed form for licensing of the premises, accompanied by the prescribed fee, and the resulting licence expires on 31 December every year, with renewal conditional on continued compliance with conditions the Board sets. Section 35A also gives the Board, or anyone it authorises in writing, the power to enter the manufacturing premises at any time, sample any medicinal substance under production, and confirm that the method of manufacture the Board approved is actually being followed. This is not a passive licence; it carries a standing right of inspection for as long as the business operates.

Before that licence is granted, the facility must satisfy the Board’s Good Manufacturing Practice requirements. The PPB has published the Kenya Good Manufacturing Practices Guidelines together with a set of more specific instruments, including guidelines for establishing manufacturing facilities for health products and technologies and guidance notes for GMP inspections of active pharmaceutical ingredient manufacturers and handlers, with separate procedures for specialised categories such as manufacturers of medical gases. In practice, PPB inspectors physically assess the premises design, equipment qualification, quality management systems, documentation controls, staff qualifications, and sampling and testing arrangements against these standards before any manufacturing licence is issued, and again at renewal and on an ongoing basis under the Board’s statutory inspection powers. A business that fails a GMP inspection, or that manufactures without having obtained a licence at all, exposes itself to prosecution; the Act’s general penalty provision, section 51, sets a fine of up to one million shillings, imprisonment of up to two years, or both, for offences under the Act unless a different penalty is specified.

Registering Individual Medicinal Products: A Separate Process

Holding a manufacturing licence for the factory does not, on its own, authorise the sale of any particular medicine. Each individual product, in its specific formulation, strength and pack presentation, must separately be registered with the Board before it can lawfully be marketed. Since 2022 this process has been governed by dedicated subsidiary legislation, the Pharmacy and Poisons (Registration of Health Products and Technologies) Rules, which set out a structured schedule of regulatory fees for registration activities distinct from the fees payable for the manufacturing licence itself, with the Board confirming that full implementation of the revised fee schedule under those Rules takes effect from 1 January 2026.

The registration dossier follows a five-module structure: administrative information about the product, applicant and manufacturer; summaries of quality, non-clinical and clinical data; and, in Modules 3 to 5, the detailed chemical and pharmaceutical documentation, non-clinical study reports, and clinical study reports. Applicants submit a hard copy and an electronic copy of the dossier together with product samples and batch certificates of analysis, and, for products manufactured outside Kenya, a Certificate of Pharmaceutical Product in the World Health Organization format from the country of manufacture. Under the Board’s published submission guideline, registration fees have historically been set at US$500 for a product fully manufactured in Kenya against US$1,000 for an imported product, with correspondingly lower renewal fees for local products; these figures should be checked against the Board’s current fee notice given the transition to the 2022 Rules. A grant of registration is valid for five years unless earlier suspended or revoked, complete new applications are generally evaluated within twelve months of receipt, and the Board operates a fast-track route for locally manufactured and priority medicines, targeting ninety working days for complete applications. A business expanding its product range, or altering an existing formulation, will typically need a fresh or varied registration even though its manufacturing premises are already licensed.

Environmental Licensing and Other Regulatory Requirements

A pharmaceutical manufacturing plant is an industrial facility, and section 58 of the Environmental Management and Co-ordination Act (Cap 387) requires that a project likely to have a significant environmental impact obtain an Environmental Impact Assessment licence from the National Environment Management Authority (NEMA) before it is implemented. NEMA’s own guidance confirms that projects falling within the Act’s Second Schedule category of processing and manufacturing industries, which captures chemical works and pharmaceutical processing plants, require an EIA licence, and describes a process running from scoping and terms of reference through an EIA study, NEMA’s review and decision, a right of appeal, and, once the plant is operating, annual environmental audits. NEMA’s licensing fee is set at 0.1% of the total project cost, with a minimum of Kshs 10,000, funded by the project proponent. This process runs in parallel with, and independently of, the PPB licensing track described above; a manufacturer needs both.

The Kenya Bureau of Standards (KEBS), established under the Standards Act (Cap 496), has a general mandate to promote standardisation, certify commodities and administer marks of quality such as the mandatory Standardisation Mark and the voluntary Diamond Mark. These schemes are pitched primarily at general manufactured goods and foodstuffs rather than medicines; the quality, safety and efficacy of medicinal products themselves are regulated specifically through the PPB’s GMP and product registration regime described above, not through KEBS’s certification marks. A pharmaceutical manufacturer should still expect Standards Act requirements to apply to ancillary matters, such as the calibration and verification of weighing and measuring instruments used in production and standards applicable to packaging materials and other inputs.

Government Incentives for Local Pharmaceutical Manufacturing

Kenya’s Ministry of Health has confirmed that a presidential directive issued in October 2023 committed the country to manufacturing locally at least fifty percent of the medicines on the Kenya Essential Medicines List by 2026, and that this commitment is now anchored in the Kenya Local Manufacturing Strategy 2025-2030, aimed at scaling up production and moving toward self-reliance in health products and technologies. Alongside this policy push, Kenya’s official investment promotion agency, the Kenya Investment Authority, markets a set of general investment incentives to pharmaceutical manufacturing investors specifically, built on Kenya’s existing Export Processing Zone and Special Economic Zone regimes rather than on pharma-only tax rules. According to its current sector guidance, an Export Processing Zone enterprise can access a ten-year corporate tax holiday, a ten-year withholding tax holiday, perpetual exemption from stamp duty on legal instruments, and a full investment deduction on qualifying new investment, while a Special Economic Zone enterprise can access a reduced corporate tax rate of 10% for the first ten years and 15% for the following ten, together with exemption from VAT and customs import duty on inputs. Outside those zone regimes, the same guidance points to the general 100% investment deduction available under the Income Tax Act for qualifying capital expenditure above Kshs 200 million, VAT zero-rating for local supplies, and a “virtual EPZ/SEZ” model intended to let manufacturers access these benefits without relocating to a designated zone. Because these are general investment incentives rather than instruments specific to the Pharmacy and Poisons Act, eligibility for any particular scheme should be confirmed with the Kenya Investment Authority and the Kenya Revenue Authority against the investor’s actual facility and structure before it is relied upon.