Naira instability threatens local drug production, PMG-MAN warns

The Pharmaceutical Manufacturers Group of Manufacturers Association of Nigeria has stated that the persistent depreciation of the naira against major foreign currencies must be addressed for President Bola Tinubu’s Executive Order on pharmaceuticals to effectively boost local drug production.

Although PMG-MAN acknowledged the benefits of the order, the group emphasised that the most crucial factor for the success of the domestic pharmaceutical industry is a stable exchange rate.

The drug manufacturers maintained that unless the value of the naira was stabilised, achieving 70 per cent local drug manufacturing would be impossible regardless of the order.

The group noted that the Federal Government must begin the implementation of the order to avoid exacerbating the soaring hikes in drug prices.

Recall that in June, the Coordinating Minister of Health and Social Welfare, Prof. Ali Pate, announced that Tinubu signed an executive order to increase local production of healthcare products such as pharmaceuticals, diagnostics, devices like needles and syringes, biologicals, and medical textiles, among others.

The order, which will be implemented by agencies such as the Nigeria Customs Service, National Agency for Food and Drug Administration and Control, Standard Organisation of Nigeria, and the Federal Inland Revenue Service, would grant special waivers and exemptions for these products for two years.

Pate noted on his X account, formerly Twitter, “In a transformative move to revitalize the Nigerian health sector, 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.).”

The immediate trigger of the current instability of the naira has been linked to the decision of the Tinubu administration to float the national currency through the elimination of the multiple exchange regimes, which left the naira at the mercy of market forces.

Speaking in Lagos recently ahead of the forthcoming 7th Edition of the Nigeria Pharma Manufacturers Expo, slated for September 4th to 5th, 2024, Chairman of the Local Organising Committee, Patrick Ajah, urged the Federal Government to provide a timeline for the implementation of the executive order.

Ajah said the government would need to take certain steps to achieve 70 per cent local drug production, lamenting that the recent fluctuations in the value of the naira have made it difficult for companies to plan and invest.

The pharmacist, Ajah, who is the Managing Director of May & Baker Nigeria Plc, noted that it was not enough to issue an executive order; there must also be a timeline for implementation.

He warned that delays in the implementation of the order by the Federal Government agencies involved could lead to the drug shortages the order seeks to address by boosting local manufacturing of medicines and reducing importation.

He also emphasised the need for the government to follow up and ensure the full implementation of the order.

Ajah said, “Nobody has engaged us in the process. Let me be honest, if the government does not ensure the implementation of this, it can turn around to be negative. Many companies are waiting for the implementation.

“If we keep delaying the things that companies should have placed orders for, there will be scarcity. And if the implementation doesn’t start immediately, we’ll have a situation where you do not know where we’re going.

“This is one major reason why multinational companies are leaving. It’s not the fear of subsidy removal. If we didn’t tamper with the currency, all the multinational companies would be here and they would still be making more investments.”

Expressing worry about the negative impact of foreign exchange scarcity on the industry, Ajah disclosed that many companies are waiting to see if the recently announced executive order will be implemented before placing import orders.

He called for increased government support for the local pharmaceutical industry, stressing that with the right backing, Nigeria can produce 70 per cent of the medicines it consumes.

Giving insight into the Expo, Executive Secretary of PMG-MAN, Frank Muonemeh, urged the government to provide support to the pharmaceutical sector similar to that which has been provided to other sectors, such as cement and petroleum.

Muonemeh expressed optimism that Nigeria could achieve the goal of producing 70 per cent of its medicines with the right government support, adding that increased exports from the domestic pharmaceutical industry would also help alleviate the country’s foreign exchange challenges.

On the 2024 Edition of NPME, with the theme “40 Years of Advocacy: Fostering Partnership and Innovation to Unlock the Pharma Manufacturing Value Chain in Nigeria, Central & West Africa,” Muonemeh said their ambitious goal seeks to reverse the country’s dependency on imported medicine from 70 per cent to 70 per cent locally produced.

He said the 7th NPME 2024 is the flagship expo and the largest pharmaceutical manufacturing exhibition in Central and West Africa, organized by PMG-MAN and partners, GPE India.

“Experts predict that the Nigerian pharma space would be the next frontier for smart investment and trade, with great but largely untapped potential to contribute to national and regional development.

“To unlock this potential, the group organizes a biennial Pharma Expo and Exhibition, focusing on the latest pharma technology, machinery, equipment, Active Pharmaceutical Ingredients, and showcasing locally manufactured medicines, diagnostics, and consumables,” he said.