COVID-19 has become a blessing in disguise for Nigeria’s drug makers as the pandemic shot up their revenues in the second quarter of 2020.
In the last five second quarters (Q2), the revenue of the second quarter of 2020 appears to be the largest, BusinessDay found.
The affected drug makers are May and Baker (M&B), Fidson and GlaxoSmithKline plc (GSK).
Collectively, the three drug makers reported revenue of N22.47 billion in Q2 of 2020, from N13.06 billion recorded in Q2 of 2016. The three firms reported revenues of N18.49 billion in Q2 of 2017; N20.48 billion in Q2 of 2018; and N21.19 billion in Q2 of 2019, BusinessDay analysis of their financial reports has shown. Their collective revenue in Q2 of 2020 shows an increase of six percent from that of Q2 of 2019.
According to analysts, the growth recorded in the industry stemmed majorly from the impact of the pandemic which forced a change in the lifestyle of people, thereby pushing consumers to spend more on drugs to keep them safe and healthy.
In addition, the pandemic also saw a rise of over 50 percent in the prices of drugs and medical supplies, they said.
Ambrose Oruche, acting director general, Manufacturers Association of Nigeria (MAN), said that the pandemic gave room for essential items such as food and drugs to thrive.
“The pandemic period gave room for essential products which were necessary at that time, especially the food and healthcare subsectors,” Oruche said in a phone interview.
Fidson pharmaceuticals made revenue of N7.37 billion in 2019. However, in 2020, the firm grew its revenue by 11 percent to N8.2 billion with significant contributions from its ethical unit worth N4.6 billion and its over-the-counter goods of N3.5 billion.
M&B’s revenue declined by a marginal one percent, after realising N3.84 billion in Q2 of 2020, as against the N3.86 reported in the corresponding period of 2019. It made its largest sale from pharmaceuticals which contributed N3.8 billion to its revenue. Its gross profit stood at N1.45 billion, representing a 19 percent growth from N1.22 billion in 2019 while its profit after tax stood at N407 million after a 48 percent increase from the N275 million realized in 2019.
GSK recorded an increase of 5 percent in its revenue, moving from N9.96 billion in 2019 to N10.43 billion in 2020, after making N7.5 billion in sales and N1.59 billion in profit from pharmaceutical products sold. Its gross profit dropped by 7 percent to N2.7 billion from N2.9 billion in 2019 while its profit for the period stood at N447 million after a 16 percent drop from the N531 million it made in 2019.
