As patients continue to grapple with scarcity of essential medicines for their health conditions, a concerned stakeholder in the pharmaceutical industry, Pharm. Akinjide Adeosun, has said it is only an holistic intervention of the Federal Government that can improve the situation.
Adeosun, who is the chairman & Chief Executive Officer (CEO) of St. Racheal’s Pharmaceutical Nigeria, in a chat with Pharmanewsonline, emphasised that except the President Bola Ahmed Tinubu’s led administration look critically into the root causes of the recent spike in drug prices and scarcity of ethical medicines, there might not be immediate relief for citizens.
He maintained that the challenges are multifaceted and as such require an inclusive approach, because a one-sided intervention will not suffice.
Pharmanewsonline reports that there have been massive public outcry about the scarcity of medicines in the country, since 1 August, 2023 when the British Pharmaceutical giant, GlaxoSmithKline, announced its exit from the Nigerian market after 51 years of operations in the country.
Sooner rather than later, a French Pharmaceutical multinational, Sanofi Aventis, in November of the same year, also subtly informed the public about its exit.
Aside these, other foreign manufacturers like Bolt Food, Unilever, and Procter& Gambles, shut down their Nigerian offices, due to unfavourable economic indices.
The implication of these, and other issues like monetary challenge, fiscal policy, inflation, among others, according to Adeosun is the burden of medicines insecurity, which has led many patients to their graves untimely.
“One primary concern is the monetary challenge, and the susceptibility of the pharmaceutical industry to changes in exchange rates poses a severe threat.
“It becomes evident that these challenges require government intervention, not just to address the symptoms but to tackle the root causes and avert a looming disaster in the pharmaceutical sector.
“The current parallel market exchange rate for the dollar stands at ₦1,251, a significant surge from the pre-existing rate of ₦461 official rate before the current government took office.
“It’s essential to acknowledge that reforms, which should have been initiated even four years ago, have played a role in the economic landscape”, he said.
He further observed the forex challenge has plunged many multinationals into a year-long drought in official allocations, exacerbating production and importation challenges. The ripple effect “is felt in the prices of drugs, with a $2 Free On Board (FOB) remaining constant globally but experiencing a substantial increase in naira due to the elevated exchange rates”.
For instance, he noted that a drug priced at ₦1000 has surged to ₦3000, showing the stark difference in the cost implications. “The once assessable official rate is now inaccessible, leaving industries, especially multinationals, in a challenging predicament as they grapple with the consequences of the evolving economic landscape”, he lamented.
The St. Racheal’s boss didn’t fail to mention the all- time high inflation rate, as one of the root causes of the pharmaceutical industry ailment, even though it cuts across all sectors of the economy, which rose from a previous rate of 17 per cent to the current alarming rate of 27 per cent.
According to him “This inflation, driven by internal factors like food insecurity, inherently impacts the cost of goods, services, and crucially, pharmaceuticals. The intricacies of inflation extend to the lending rate, specifically the Monetary Policy Rate (MPR), adjusted by the Central Bank of Nigeria’s Monetary Policy Committee. MPR is currently 17.5 per cent and lending rate is 30 per cent. For the lending rate to go down, thereby increasing consumer borrowing, the MPR must go down”.
He further identified the fiscal issues exacerbating the ugly scenario to include various taxes and levies, with corporate income tax standing at 30 per cent, and arbitrary levies imposed by the Federal Inland Revenue Service (FIRS) further burden businesses.
The prominent pharmacist explained how this heavy taxation has hampered the manufacturing of certain drugs, including vital high-tech drugs and biologicals, in the country, with import duty at 20 per cent for finished brands and 5 per cent for Active Pharmaceutical Ingredients (API).
Adeosun therefore demanded urgent government action on all these negative forces to give the industry players conducive environment to operate for the overall health benefit of the nation.
