Driven by the need for sustainable manufacturing of in-country pharmaceutical products, GlaxoSmithKline (GSK) Nigeria Consumer plc, and Fidson Healthcare have announced the commencement of a contract manufacturing agreement. This decision establishes GSK as one of the healthcare multinational companies localising productions of its brands via local contract manufacturing.
The contract manufacturing estimated to be over N10 billion will see GSK outsource its product manufacturing to Fidson at a pre-agreed fee, while GSK will take responsibility for marketing the manufactured products. There is also a five-year renewal agreement in the partnership to allow for further review. “Every agreement should have a process of renewal; so that we rethink a few things at the point of renewal,” said Fidelis Ayebae, the MD/CEO of Fidson Healthcare Nigeria Plc.
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According to Ayebae, the partnership is not quantifiable considering the level of expertise and knowledge being transferred and the investment Fidson is making to ensure it meets GSK manufacturing requirements and standards.
Mojisola Adeyeye, the director-general of the National Agency for Food and Drug Administration and Control (NAFDAC), said the most important aspect of the partnership is Nigeria’s drug security. According to her, the contract manufacturing agreement between GSK and Fidson will also create more employment for Nigerians.
Adeyeye posits that the regulatory agency has been working behind the scene to ensure pharmaceutical companies work in partnership to deepen healthcare service delivery in the country. According to her, NAFDAC seeks to ensure that quality drugs are made in Nigeria either by manufacturers alone or through partnership.
“We don’t have to go out to get some medicines; so, this is going to help local manufacturers and encourage other companies to partner with multinationals and Nigerians who have been importing drugs into the country. Whichever way you look at it, it’s plus-plus for Nigeria,” Adeyeye said.
The transfer of manufacturing capabilities of assets from one company, that is GSK to an indigenous company, Fidson Healthcare plc in Nigeria, simply means that GSK is shutting down its manufacturing plants by outsourcing to Fidson. In other words, GSK has shut down an over 60-year-old plant in a contract manufacturing deal with Fidson, which is considered a big outsourcing deal for Nigeria.
The contract manufacturing agreement is expected to be beneficial to all stakeholders, including the Nigerian consumers who are likely to enjoy and get GSK manufactured products at a reduced rate. The agreement will also ensure that GSK products are made available in Nigeria by an indigenous company, meaning more Nigerians will be employed to carry out the day-to-day manufacturing processes.
Similarly, the contract manufacturing will also be beneficial to professionals like pharmacists, chemists, and microbiologists that are part of the training and technology transfer provided by the GSK team under the partnership agreement provided in the process and in the coming years.
Recall that earlier in 2018, GSK made the announcement that it will be restructuring its supply chain operating model that will allow for contract manufacturing of five (5) formulations (products) by Fidson Healthcare Nigeria Plc. The decision was reached after a detailed and rigorous request for quotation (FRQ) process that involved a number of local manufacturers in Nigeria.
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