• Friday, December 01, 2023
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Drug manufacturing in Nigeria


Nigeria has a growing pharmaceutical market in West Africa. Over 120 pharmaceutical formulation manufacturing facilities account for 60 percent of drug manufacturing in the ECOWAS sub-region. Huge market aside, Nigeria’s quest to become self-sufficient in drug production is dependent on the importation of active pharmaceutical ingredients (APIs) from India, the US and Germany.

APIs are the chemically active substances, which are meant to produce the curative effects on the body. Essentially, a drug has two components, the API and the excipient. The excipient is the substance used as a diluent or vehicle for a drug. Most Nigerian pharmaceutical companies do not manufacture APIs such as Paracetamol powder, Ampicillin dry powder etc. Over N1.5 billion is spent annually to import 85 percent of API used in Nigeria. Facilities required for APIs are high technology equipment and machinery which can only be imported.

Continued dependence on API imports is avoidable. The reason why Nigeria cannot manufacture APIs is because petrochemical and chemical industries in the country are underdeveloped. Petrochemicals are the starting point for pharmaceutical raw materials.

As it stands today, if one decides to invest in API production, the finished products will be very expensive and will not be able to compete with imports as the necessary supporting industry and infrastructure is not in place.

The cost of finished pharmaceutical products is not in the hands of Nigeria; it is determined to a large extent by the cost of imported APIs. If for any reason Nigerian pharmaceutical companies are not able to import APIs, pharmaceutical production will be affected.

A cursory look at the global APIs market shows that North America dominates the market, generating 35.1 percent of global API revenues in 2011. The Asia-Pacific region also saw high growth, second behind North America with a revenue share of 29.7 percent in 2011. Europe is the third largest regional market for APIs by revenue globally with a market share of around 24.2 percent.

Total revenue generated by the European API market was $26,288.96 million in 2011 and is expected to grow at a Cumulative Average Growth Rate (CAGR) of 6.5 percent to reach $38,255.67 million by 2017.This is supported by healthy demand from generic and biotech API sectors.

Nigeria and India signed a Memorandum of Understanding (MoU) on co-operation in the pharmaceutical sector in March 2011, allowing India to export pharmaceutical products, including Active Pharmaceutical Ingredients (API) and fine chemicals to Nigeria, to the tune of $307 million, as at March 31, 2012.

No doubt, non-availability of APIs would significantly cripple Nigeria’s pharmaceutical sector, thereby affecting her quest to become an emerging pharmaceutical hub of the West Africa region.

There is need to develop the chemical/petrochemical industry, provide necessary infrastructure and environment to make locally manufactured APIs competitive in the international market, as any local investor might need to export, if local market is not able to absorb all the products. There is also the need for government to show commitment by encouraging investors in this vital sector of the economy.