‘The reality is that the future of Barrs is uncertain and, at this stage, not positive.’
There is currently no indication that Barrs Pharmaceuticals is at risk of liquidation, but even if it is the supply of antiretroviral (ARV) medicines will not be disrupted, the national department of health says.
Barrs Pharmaceuticals is one of the 11 companies awarded a national tender to supply HIV medication across South Africa. However, Barrs and its sister company, Innovata Pharmaceuticals, registered for business rescue on 9 December, 2025, just days after the contract to supply ARVs began on 1 December, 2025.
Trouble seems to be mounting for Barrs, after an apparent internal letter to staff, leaked to The Citizen, warned of uncertainty about the company’s future. The letter also provided an update on the court battle between the company and Nedbank, which the latter won.
“The reality is that the future of Barrs is uncertain and, at this stage, not positive,” reads the letter.
No plan to move forward at the moment
The letter details that the court judgment favouring Nedbank represents a setback for the business rescue plan.
“Management met with the union yesterday and communicated that this judgment represents a serious setback to the planned recovery of the business, including the previously indicated timeline to resume operations by July 2026,” reads the letter.
“The business rescue practitioner has advised that consideration is being given to either challenging the court ruling or proceeding with a revised business rescue plan, as directed by the court. No decision has been made, and no timelines have been provided.
“This means that, at present, there is no clear or agreed path forward.”
Skeleton staff at Barrs
In late January, a source close to the matter told The Citizen Barrs has since hired skeleton staff after telling employees to stop reporting for duty on 30 September, 2025. Its business rescue practitioner did not confirm this.
However, the leaked letter to staff reveals that Barrs did move to a skeleton workforce, a measure it appears will remain in place for the foreseeable future.
“In light of the prevailing uncertainty, it now appears more likely that Barrs will need to continue operating under a skeleton staffing arrangement beyond July 2026, with no clear indication of when – or if – full operations will resume,” reads the letter.
A comment from Barrs will be added once received.
Uncertainty
The letter states that the continuation of the business is dependent on three critical and uncertain factors:
1. Whether the business rescue practitioner elects to challenge the court’s ruling;
2. Whether the current investor, Hetero, maintains its interest in the business; and
3. Whether any revised business rescue plan is accepted by creditors.
“Should these not be resolved favourably, there is a significant risk that Barrs may not be able to continue operating, and liquidation remains a real possibility,” reads the letter.
“Employees should understand that this may have direct implications for the future of the business and, potentially, for ongoing employment.”
ARVs tender
Foster Mohale, department of health spokesperson, told The Citizen there is currently no sign that Barrs Pharmaceuticals is at risk of liquidation.
“However, in the unlikely event that this were to occur, the department would not face a significant risk to ARV supply,” he said.
“This is because the ARV tender was deliberately structured with multiple awarded suppliers to ensure security of supply and mitigate potential disruptions.
“The department continuously monitors supplier performance and has contingency measures in place to reallocate volumes where necessary to maintain uninterrupted access to treatment.”
Health Minister Aaron Motsoaledi and a large group of senior officials have previously appeared before the parliament’s portfolio committee on health to answer how the ARV tender is structured.
Supplying morphine
Barrs and the department reached a decision while the former could not deliver ARVs that it would instead supply morphine for the time being.
Mohale said the supply of morphine has not experienced any disruptions and the company has also started supplying ARVs.
“The supply of morphine powder by Barrs Pharmaceuticals remains stable, with no reported disruptions.
“In addition, the company has resumed and is currently maintaining a stable supply of ARVs. The department continues to monitor both product lines closely to ensure consistent availability across facilities.”
Payments
Mohale added that payments to Barrs are made in line with standard government procurement processes.
“This means that payment is effected by provinces only after delivery has been received and a valid invoice has been submitted,” he said.
“Therefore, in instances where provinces have received ARV deliveries from Barrs and invoices have been processed, the corresponding payments would have been made.”