Drug makers yet to leverage new executive order on uncertainty

…warns of potential drug scarcity

Pharmaceutical companies are yet to leverage a recent executive order which reduced crippling tariffs on medical imports.

President Bola Tinubu had introduced the widely cheered policy two weeks ago which was targeted at boosting local production of essential medical supplies. Drug makers say one of the reasons for that is that the timeframe for implementation remains unclear.

The uncertainty surrounding its implementation has led many manufacturers to pause or slow down their procurement processes, anticipating the opportunity to benefit from the regulatory change, Patrick Ajah, chief executive of May & Baker Nigeria Plc, said on Wednesday during a briefing on the upcoming 7th Nigeria Pharma Manufacturing Expo (NPME).

If the hesitation to make procurements persists and the government fails to provide a clear guidance for manufacturers, Ajah warned that it could lead to scarcity of drugs, with distributors and pharmacies struggling to maintain adequate inventory levels of essential medications.

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“Immediately that announcement was made, the procurement we wanted to make was paused to ensure we could benefit from this. I am sure many other companies are waiting. What will happen if the implementation doesn’t start is that many of us who are waiting will not import things. If we keep delaying, the things that companies should have placed orders for will be delayed. There will be scarcity,” Ajah, who chaired the planning committee of the expo, said.

“So, it is not enough to make an executive order without stating a particular time. It could just be another media blast.”

Largely, the executive order has been seen as a key action that demonstrates that stakeholders in the healthcare sector have the ears of the government, following a turbulent year of unusual rise in drug prices. Patients face limited access to vital drugs, harming their health and wellbeing.

Muhammad Pate, minister of Health and Social Welfare, has held multiple consultations with the Pharmaceutical Manufacturers Group of the Manufacturers Association of Nigeria (PMG-MAN) and other key stakeholders over the past year to ensure they are all on the same front.

According to the minister, the order introduced zero tariffs, excise duties, and value-added tax on specified machinery, equipment, and raw materials.

Items including active pharmaceutical ingredients (APIs), excipients, and raw materials for syringes and needles, long-lasting insecticidal nets, and rapid diagnostic kits also qualify to benefit from this policy. They will all be imported without tariffs.

The concern is whether the government is ready to match its words with actions, especially knowing certain agencies’ goals to generate revenue often conflicts with the ultimate goal to lower the cost of healthcare for Nigerians.

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While commending the effort behind the executive order, Frank Muonemeh, executive secretary of PMG-MAN, emphasised that a bold declaration is just 10 percent of the work needed to achieve the desired outcome.

He said the previous administrations of President Goodluck Jonathan and President Mohammad Buhari had similar policies to protect pharmaceutical inputs from VAT.

However, the challenge was the lack of implementation.

“Where the problem lies is to achieve implementation which constitutes about 90 percent of efforts. So, while we are excited about the executive order we all worked together with the minister of health to achieve, we are looking forward to the framework to start implementation. I equate political will to the implementation of the policy,” Muonemeh said.

The expo billed for September 4 is expected to offer a platform for a robust discourse on the potential of the order.

The PMG-MAN organises the expo once every two years with a focus on unlocking the untapped potential of the pharmaceutical sector to contribute to national and regional development.

This year’s exhibition promises to feature a display of new technology in machinery, equipment, APIs, as well as locally manufactured medicines, diagnostics and consumables.

About 200 showcasing companies and almost 5,000 trade professionals are expected from five continents, the secretary said.

Considering the exit of multinationals and the rising cost of medicines due to economic challenges, the event is themed, ‘40 Years of Advocacy: Fostering Partnership and Innovation to Unlock the Pharma Manufacturing Value Chain in Nigeria, Central and West Africa’.