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Boosting Local Drug Production in Nigeria

The value of Africa’s pharmaceutical industry jumped to $20.8 billion in 2013 from just $4.7 billion a decade earlier. That growth is continuing at a rapid pace. It is predicted that the market will be worth $40 billion to $65 billion by 2020 according to reports.

Indeed, while this is good news for the Pharma sector in Africa, it is not yet uhuru for the pharma sector in Nigeria. The travails of Nigeria’s pharmaceutical industry are very well documented. There is no gain saying that, Nigeria’s pharma industry is confronted with an avalanche of challenges. Of note is the fact that Nigeria’s pharma sector is heavily import dependent.

Boosting Local Drug Production in NigeriaAlso, in recent times, local drug manufacturers in the country have bemoaned the increasingly hostile business environment, especially with the country’s weak infrastructural base; coupled with issues of inadequate funding, fake and sub-standard drugs among other challenges. At this rate, most of the local drug manufacturing companies do not have the installed capacity to meet local demands, neither can it in most parts significantly contribute to Nigeria’s economy, talk-less compete with the global drug markets.

It is noteworthy that South Africa remains as the best for pharmaceutical manufacturing in sub-Saharan Africa. Unfortunately, the local drug manufacturing markets in Nigeria is still relatively not well developed nor well positioned to be at par with the top models in India, Brazil, USA among others.

Essentially, the Federal Government through the Central Bank of Nigeria has boosted the manufacturing sector by directing deposit money banks to ensure that at least 60 per cent of foreign exchange sales to end users are given to local manufacturers. Also, the government has created a special intervention fund to revolutionise drug manufacturing in Nigeria. These actions of government are indeed commendable. However, stakeholders say that more still needs to be done, especially in the area of appropriate polices targeted at the sub-sector.

I think the pharmaceutical industry is still not considered a key sector in Nigeria. This is very worrisome. If not for the intervention fund that was provided some time ago for a few companies that were working towards WHO certification, the sector still finds itself sourcing for adequate funding. If the government could have bank of Agriculture, what stops them from having bank of Health or Pharmaceutical industry. This issue should not be diluted with other various sectors. Funding through a proper mechanism is very important. This will help to drive focus and convergence of efforts in all that we are doing”, said Pharm. Lekan Asuni, President, Association of Nigerian Representatives of Overseas Pharmaceutical Manufacturers (NIROPHARM) in an interview with PharmaTimes.

In Nigeria, a lot has been said about the cost of doing business. Some have described the cost of doing business in Nigeria as fragmented and financially unfriendly. There are issues of weak infrastructural base besetting Nigerian business such as lack of good roads, power, security, transportation among others. Definitely, this may put off any possible investor in the sector.

According to Pharm. Asuni, Nigeria should borrow a leaf from what is happening from other pharmaceutical markets across the world on ways to boost the local capacity of manufacturing drugs in the country: “If you look at what the Asians are doing for instance, we should learn from them. For instance, they have dedicated cluster development parks. In India, they have this. In Nigeria, we are all aware that getting a parcel of land is not easy. If you bring in the issue of roads, power, and the rest, it is really a challenge. Imagine, if we have a pharma park in Nigeria, all of the issues associated with infrastructure will be addressed there. There will be concentration on skills and expertise; the land will be on lease. When we have such places, global developers can come in and build structures along the line. You find that some of the raw materials and machineries used by the local manufacturers still come with import duty. There are some basic medicines that can be produced locally. What the Government should do, is to patronise these companies and support them to grow.”

Adding further, Asuni said “When you look back at the listed companies on the Nigerian stock exchange in the 70s and 80s, the pharmaceutical industry contributed about 5 to 10 percent to the total value of stocks in the market. But what we have now is less than 1 percent. However, this does not mean that the Pharma sector cannot contributesignificantly to Nigeria’s economy.”

Stakeholders have stressed that boosting the local pharmaceutical sector will in effect create jobs, avenues for exports, and considerably raise local capacity for drug production in the country. Also, development in the Pharma Manufacturing Sector can generate increased internal revenue for the Government. It can also significantly contribute to Gross Domestic Product (GDP), increase Forex earnings from exports as well as the growth of related industries and sub-sectors.

While it is also clear that government and other policy makers should introduce price controls and import restrictions to encourage domestic drug manufacturing, more importantly in the area of forging partnerships, pharmacy chains are consolidating and manufacturing is expanding. A flurry of mergers and private-equity deals are further extending Africa’s markets. Nigeria’s local drug manufacturers should embrace this trend. Extra effort should be made to attract funding by forging partnerships with Global pharmaceutical companies/entities that need local business partners.

“Nigeria needs to invest in the growth of the pharmaceutical sector; specifically promote generic drug manufacturing that meets international standards. Incentives should be given to indigenous pharmaceutical companies to manufacture high quality and affordable medicines,” said Dr. Nkere Ebube, President Nigerian Association of Pharmaceutical Scientists in the Americas, (NAPPSA) in a chat with PharmaTimes,

Finally, investing in research is important for local drug manufacturers to drive innovation and improve new products. It is the dream of all, for the country to be self-reliant in drug production and supply, not only for economic and health reasons but for security reasons as well.


Gabriel Ifinnwa


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