Manufacturers in the chemical and pharmaceutical sub-sector invested N179 billion in the first quarter of 2014 to grow capacity and gain global market share.
These investments were made in land, building, plants, machines, furniture, equipment, vehicles and assets, Manufacturers Association of Nigeria’s latest data, released to BusinessDay, have shown.
But this represents 18.2 percent decline from N218.8 billion worth of investments made in the second half of 2013. However, this has made the chemical and pharmaceutical sub-sector the best investment destination in the manufacturing sector within the period under review.
“The chemical and pharmaceutical group leads the pack in with about 37 percent share of all investments the manufacturing sector,” MAN says in its data analysis.
Indorama is leading the pack in the chemical industry, having started a four-year $3.7 billion investment run in its Eleme Petrochemicals Company in Rivers State in 2013, according to the company’s quarterly journal.
Read also: Market fundamentals still strong for property demand despite election fears, naira devaluation
The firm began a methanol plant worth $800 million before H1 2014 and a $200 million low density poly-ethylene (LDPE) plant.
“Success brings financiers. When the company desired to raise $800 million from international financiers to add to the $400 million raised from the equity holders, the IFC (International Finance Corporation) mopped up $1.8 billion and returned the surplus. They mobilised funds from Nigeria, Europe, the US and other countries,” Jossy Nkwocha, head of corporate communications, who represented Manish Mundra, managing director said, during the 29th annual general meeting held in Port Harcourt.
Investments in the pharmaceutical industry have been mostly driven by the quest for the World Health Organisation (WHO) pre-qualification or certification, which enable drug makers to market their products in different countries of the world. BusinessDay gathered that many drug makers have been changing the configurations of their factories for this purpose.
To actualise this target, members of the Pharmaceutical Manufacturers Group of the Manufacturers Association of Nigeria (PMG-MAN) pumped N70 billion into expansion between 2010 and 2014, according to Okey Akpa, managing director, SKG Pharma, told BusinessDay.
Already, four major drug makers, notably Swipha, Evans, May&Baker and Chi Pharmaceuticals have gained the WHO certification and can now equate their products to those of international peers.
This feat can be attributed to the Bank of Industry’s (BoI) regular intervention funds to the sub-sector, which have now enabled players to upscale their production facilities and quality control systems to international standards.
“I must say that Swipha is the first company not only in Nigeria but in West Africa to be so certified, so it is a great achievement and we are very proud in BoI that we have been instrumental to this feat. The next stage is now to go to product specific certification and we are also in discussion with them to ensure that they achieve that as well,” Rasheed Olaoluwa, managing director, BoI, said.
With these investments, Nigeria’s pharma sector can now manufacture drugs such as anti-retrovirals (ARVs)for HIV/AIDS, Artemisinnin Combination Therapy (ACTs) for malaria intervention, commodities (zinc sulphate/Oral Rehydration Solution and Chlorhexidine gel, among others.
“We are proud to confirm that a Nigerian company, Drugfield Pharmaceuticals Ltd, has been granted regulatory approval to produce Chlorhexidine gel, a high impact, low-cost medicine that prevents umblical cord infections in newborns.
“ It is the first registered Chlorhexidine gel in Africa. It is noteworthy to state that this medical product is on WHO’s List of Essential Medicines, a list of the most important medication needed in a basic health system,”said Akpa, who is also chairman, PMG-MAN, in an interview with BusinessDay.
