Revamping nation’s pharmaceutical industry

… critical for economic development

There is no gainsaying that the importance of the pharmaceutical industry is crucial to the economic development of any nation, however, pharmaceutical products, especially drugs, are so priceless that no country can survive without them.

With over 75 percent of essential drugs being imported into the country coupled with perceived weak state of production facilities at Nigeria’s pharmaceutical manufacturing sector, lack of meaningful patent legislation/pricing, reimbursement system, widespread corruption and graft has not only made regulation enforcement difficult, it has further led to serious faking and adulteration of original brands of drugs as well as prevented companies from raising their capacity to produce drugs, in line with international standards.

In a move targeted at repositioning local pharmaceutical manufacturing companies in the country towards manufacturing drugs in line with international standards, NAFDAC, in partnership with the Bank of Industry and the Central Bank of Nigeria (CBN), has decided to bail out the sector with an intervention fund of N200 billion (US $1.3billion) Pharmaceutical Intervention Fund (PIF).

The PIF initiative, which was proposed in April 2011 by the Pharmaceuticals Manufacturing Group of the Manufacturers Association of Nigeria (PMG-MAN) to establish an intervention fund to bail out the industry, and has received the blessing of President Goodluck Jonathan, is expected to create jobs within the expanded pharmaceutical industry.

In a recent chat with newsmen in Lagos, Paul Orhii, director general, NAFDAC, while tracing the genesis of the intervention fund, disclosed that drug importation was a security matter because over 75 percent of essential drugs in Nigeria are being imported, hence, locally manufactured pharmaceutical products would only gain international acceptance if the indigenous industry were upgraded to international standard.

Orhii stated that the need to get the World Health Organisation (WHO), pre-qualification for Nigerian-made pharmaceutical products, is essential toward enabling approval for use of such products anywhere across the globe.

According to the DG, “We need to find a way to ensure that Nigeria is self-sufficient in the production of essential medicines, and encouraging the local pharmaceutical industry to expand its facilities is one way to enable that happen so that we can cope with the situation.

“Right now, one cannot insist that Nigeria buys its pharmaceutical products from the local manufacturing industry so that they will expand, especially when it has been shown that most of the drugs in the country, especially the locally manufactured drugs are fake and substandard. If we are to buy only from our local industry right now, the international community would blackmail us that we are forcing Nigerians to take substandard drugs. It becomes a concern of the entire world.”

While stating that plans are currently underway to enable WHO come to inspect and audit some of the leading pharmaceutical companies in the country, the DG, NAFDAC, lamented that Nigeria could not participate in the international procurement for donated drugs due to the non-availability of WHO pre-qualified products locally.

“If we continue receiving donated drugs, it will kill our local pharmaceutical industry. The highly subsidised antimalarials will kill the local industry. The dumping is not good for us. But with this intervention, once WHO helps to upgrade our facilities, and with the pharmaceutical intervention fund, we can now upgrade to a level where we are at par with other manufacturing companies in the world, and now turn around to request that the donated drugs to Nigeria are purchased from the country,” he further stated.

Lending his view recently at Lagos Business School in a lecture titled “Health Care sector in Nigeria,” Enrico Liggeri, Country manager, Nigeria & East Africa Region (NEAR) Pfizer Specialties, revealed that patented drug producers and large multinational companies are often discouraged from investing in Nigeria’s pharmaceutical market because of the poor regulatory environment, lack of effective IP protection and high import duties.

In his words: “Market reliance on foreign donations and grants to meet shortfalls attributed to poor domestic budgeting and financial management; high registration fees and import duties are negatively affecting access to particular drugs by increasing prices paid by patients. Import restrictions on certain drug items are encouraging chronically low quality production and high prices by removing competitive pressure are among some of the weaknesses identified in the nation’s pharmaceutical sector.

“It is noteworthy to state that the Global Fund acquired $4.7 billion for donation of drugs to developing countries, and Nigeria, although a major recipient, nothing from the sum was spent here in the country because we do not have a single pre-qualified factory. In Africa, only South Africa, Morocco and Uganda have pre-qualified drug manufacturing companies thereby allowing them to only sell medicines to other countries. This situation has left countries like Nigeria without certified pharmaceutical firms to serve as distribution centres for drugs manufactured elsewhere.”

While the intervention fund is expected to raise the capacity utilisation of the firms from the present 50 percent to an acceptable level, aside job creation, a vibrant pharmaceutical manufacturing sub-sector would help fight the menace of fake drugs and make Nigeria self-sufficient in drug production.

With the current intervention plan, questions on the lips of stakeholders in the sector that have remained unanswered are- how is the money going to be disbursed? How many licensed pharmaceutical firms would be involved? What would be the criteria for disbursing the fund? What is government doing to create a conducive environment for industrial manufacturing both now and in the future?

Again, how will the fund be sourced? Is it from extra budgetary allocation? Are we budgeting for interim interventions while ignoring a solid blueprint for the future? Throwing money at industry by way of intervention funds without first addressing the root of the problem is not helping matters.