Pharmacists laud Tinubu’s executive order on pharma sector, seek deadline extension

President Bola Tinubu's executive order to impose zero tariffs, excise charges and value-added tax on imported pharmaceutical products and inputs has been praised by the National Association of Community Pharmacists of Nigeria.

In a special interview with PUNCH Healthwise, the body's chairman, Adewale Oladigbolu, hailed the order as a positive development and a move in the right way.

However, he contended that a sustained decrease in medication costs could not be achieved with a two-year limit.

The president of ACPN pointed out that the order would have expired by the time it was put into effect, taking into account the months that were spent on shipment, and that things would have returned to normal.

In order to guarantee the expansion of the pharmaceutical industry, he also urged the federal government to limit the open medication market and provide incentives to the pharmaceutical industry.

Muhammad Ali, the Coordinating Minister of Health and Social Welfare, announced on Friday that Tinubu had signed an executive order to boost domestic manufacturing of medical supplies like pharmaceuticals, diagnostic equipment, and syringes and needles as well as biological and medical textiles.

The Nigeria Customs Service, the Federal Inland Revenue Service, the National Agency for Food and Drug Administration and Control, Standard Organisation of Nigeria, and other authorities will carry out the order, which will provide special waivers and exemptions for the products for a period of two years.

"His Excellency President Bola Ahmed Tinubu, GCFR @officialABAT, has signed an Executive Order aiming to increase local production of healthcare products (pharmaceuticals, diagnostics, devices such as needles and syringes, biologicals, medical textile, etc.)" was the statement made by Pate on his X account, which was formerly Twitter.The next steps towards codifying the new Order are to be taken by Prince Lateef Olasunkanmi Fagbemi SAN, @LOFagbemi, the Attorney General and Minister of Justice of the Federation (@FedMinOfJustice).

He went on to say that the order included certain things such as excipients, active pharmaceutical ingredients, and other necessary raw materials needed to make vital health products like needles, syringes, and medications, as well as long-lasting insecticidal nets and rapid diagnostic kits.

The minister added that in order to support local manufacturers, the directive establishes framework contracts and volume guarantees.

In addition, Pate pointed out that it requires the ministers of Finance, Industry, Trade, and Health to provide a uniform framework for execution in order to speed up regulatory clearances.

Following the departure of the massive British pharmaceutical company GlaxoSmithKline in August of last year, medicine costs spiked.

PUNCH Healthwise had previously shown how the withdrawal, the elimination of fuel subsidies, and the naira's depreciation resulted in a more than 300 percent increase in medication costs.

Oladigbolu responded to the executive order by saying that it shows the FG's concern for the pharmaceutical business in an interview with PUNCH Healthwise.

But he pointed out that the order's timeline would not produce the outcomes the business needs.

Keep in mind that the order is not yet in effect, stated the National Chair of the ACPN. It must go through a few steps. Therefore, if it goes into force today, I estimate that it will take six months for the imported machinery to arrive, and it will take three months for the raw materials or API to ship. Therefore, we will have to wait a year before the market prices for medications start to take shape.

Therefore, if, after two years, they are unable to maintain the order, we will have a problem when we look ahead a year. We're going to return to square one.
"Within the next two years, there won't have been a significant drop in drug prices or an increase in the number of manufacturers in Nigeria." Therefore, it is evident to me that the order's duration needs to be extended and that more work needs to be done to support Nigeria's pharmaceutical sector.

Oladigbolu cited the Indian pharmaceutical industry as an example and urged the FG to offer subsidies to guarantee the sector's continued expansion.

For example, we should emulate what India is doing. Pharmaceutical companies are receiving funds from India to produce drugs, particularly for export. About 20 years have passed since the pharmaceutical industry in India began receiving these kinds of incentives. Thus, we are getting started at the right point, but more things need to be done.
"The Federal Government of Nigeria must provide grants, not loans, to support the pharmaceutical sector if it is to thrive. The pharmaceutical industry will grow at an exponential rate if they take that action. We'll start exporting medications on a net basis.

"They are now claiming zero tariff, which is fascinating, but how will the money be paid for this? You can either borrow money from banks or amass wealth on your own. Bank borrowing makes up almost 30% of total borrowing. That interest rate will be increased by the cost of the infrastructure, and there are additional conditions. These will drive up the cost of pharmaceuticals even further.

Thus, the government can set capital and tariff policies, as well as award assistance to the pharmaceutical industry based on predetermined standards. They can also structure purchases and this was noted in the release, which is good,” the pharmacist said.
In addition, he demanded that the insurance system be strengthened so that 70% of Nigerians are covered, pointing out that this would guarantee that resources would be available to shield them from rising costs.

The chemist added that drug prices will gradually drop if the executive order was upheld for a longer period of time.

The president of ACPN also underlined the necessity of the government shutting down the unregulated drug market, pointing out that these practices upset the equilibrium in the pharmaceutical supply chain and deter private investors from funding the sector.

However, he reiterated, "this does not address the issues facing the pharmaceutical business. Those unrestricted drug markets are one of our biggest issues. Because foreign direct capital cannot comprehend our industry and we are unable to oversee the distribution of medicines in Nigeria, it promotes the circulation of counterfeit medications, making it impossible for them to invest.

"We are in a good position to supply other West African nations, the continent of Africa, and perhaps sell to the United States of America. If the government could give the pharmaceutical industry more importance, we could still accomplish it.

"The National Agency for Food and Drug Administration and Control is working hard to improve our position in relation to other nations. They have reached maturity level 3, which is advantageous for the nation because it indicates that pharmaceutical manufacture is well monitored and regulated there.

Therefore, visitors from other countries won't be afraid of our industry. However, the fact that our drug market is open just serves to fuel that dread. They won't be afraid of our industry and they can be a net exporter of pharmaceuticals if there isn't an open drug market.

Oladigbolu added that since international pharmaceutical companies do not have a production facility in Nigeria, the executive order will not affect their ability to leave the nation.

"Our goals should be to bring in capital, sanitise our system, and improve the calibre of our work before allowing Nigeria to become a net exporter. Foreign multinational corporations will watch us for a while to make sure we are headed in the right way, and then they will come and build up proper manufacturing facilities—not just a marketing outfit—if our infrastructure is strengthened and there are zero tariffs on machines.

The chemist said, "They can come back and set up in the country again with this executive order."