Forex Crisis, High Interest Rate Crippling Pharma Manufacturing, Importation – Oculus MD

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Pharm (Sir) Valentine Ezeiru is the chief executive officer of Oculus PharmaCare Limited. In this email interview with Pharmanews, the Fellow of the Pharmaceutical Society of Nigeria, provides in-depth perspectives on some fundamental issues affecting the Nigerian pharmaceutical landscape. A firm  believer in the provision of quality healthcare products and services, he is equally an advocate of a better Nigeria where the best infrastructure and amenities are made available, especially for importers, manufacturers and all whose businesses are critical to the growth of the nation’s economy. Excerpts:

What gap is Oculus working to bridge in the Nigerian pharmaceutical landscape?

The first National Drug Policy was published in 1990. The objectives of the policy were to make available, at all times, medicines which are effective, affordable, safe and of good quality in all sectors of the healthcare system; and to improve the quality of healthcare, through the rational use of medicines. The extent to which the policy objectives have been met is yet to be evaluated.

Healthcare stakeholders and enlightened individuals recognise that some important gaps still exist. These include: poor quality of some pharmaceuticals, lack of ready accessibility to available pharmaceuticals, high prices of imported pharmaceuticals, high taxes on essential medicines, no national standard treatment guidelines, absence of well-structured drug information services, little or no public education on rational use of drugs, among others.

Pharm (Sir) Valentine Ezeiru

These gaps needed to be bridged and Oculus PharmaCare Limited was actually set up to address the variances.  Oculus has, in fact, done its best these past 20 years and is still working to bridge the gaps as captured by its vision.

 

What is the vision guiding the company?

Our vision in Oculus is to be a highly professional and innovative company, providing high quality healthcare products and first class services to Nigerian patients through our various partners and associates, while satisfying the interest of all stakeholders.

Over the years this vision has been upheld and anything that does not reflect supply of top quality products or support the delivery of first class services, we do not get involved in it.

I am pleased to announce that Oculus is now a well-trusted and highly respected healthcare company, with the well-being and safety of all patients at the heart of the business. Our principal activity is marketing and distribution of pharmaceuticals and allied products.

 

Every day, we strive to provide quality healthcare products and first class services to our various partners, helping millions of people who use our products and services to be well and stay well.

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We are a company guided by a set of core values which make us unique. We are passionate about doing what is right for our customers, colleagues, shareholders and communities and, by doing so, we can better serve the health and well-being of people. We strive to be creative, proactive, using innovative ways to attain our goals.

We are making giant strides in the industry with a new subsidiary of Oculus PharmaCare, NOMEDI Pharmaceuticals Limited. NOMEDI is primarily engaged in the importation and distribution of pharmaceuticals, neutraceuticals and medical devices.

 

How would you describe businesses in the Nigerian pharmaceutical industry?

The Nigerian pharmaceutical industry is an import-dependent one. Businesses in the industry are largely characterised by wholesale importation of finished products, as well as retail pharmacy business.

This scenario comes with its attendant challenges.  These challenges have prompted public and political interests in considering local production of pharmaceuticals, with the aim of promoting self-sufficiency, achieving independence from international suppliers, developing local industrial capacity, producing foreign exchange through exportation of domestically manufactured medicines and creating new jobs.

Of recent, there has been a parallel increase in the number of companies involved in local drug manufacturing. However, the import-dependent ones still flourish more than the due to a number of factors and constraints.

 

What do you consider the toughest challenge facing you as a company here in Nigeria?

There are indeed so many challenges facing us as a company operating in Nigeria.  As importers of pharmaceutical products, the toughest is the forex crisis – lack of access to foreign exchange to buy and pay our partners. The paucity of forex is gradually grinding operations in drug manufacturing and importation to a halt.

The second aspect is low financing in the industry. The banks’ interest rate is at an all time high – at about 22 per cent.  Operating at such a cost will result in high and uncompetitive pricing, in the face of rising inflation and the populace becoming extremely price sensitive.

The third factor is the declining economy and the gradual lowering of the purchasing power of the populace, occasioned by increase in inflationary rate.  These developments are further barriers to the challenge of making high quality and affordable medicines available to a majority of our people. They have also encouraged the embrace of cheap but substandard medicines by our people, with the attendant negative effects on our national growth and development

 

How has the COVID-19 experience affected your business?

I want to say that the COVID-19 pandemic is real.  It has seriously impacted our business.  There are many bad sides to the impact and at the same time, we have learnt some lessons that are indeed helping us to keep the business afloat.

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*Some of the challenges we have encountered include:

*Massive disruptions in global supply chains and Nigeria is particularly vulnerable because nearly 75 per cent of its drug supply is imported from Europe, China and India.

*Some of our products handled under our subsidiary company were affected because of scarcity of APIs; many other pharmaceutical companies are worse hit in this regard.

*Significant pressure on sales performance, due to reduced demand.  The purchasing power of the populace/household income is dwindling.

*Reduced cash inflows and liquidity challenges, due to significant downward pressure on demand.

*Reduced profit levels, as the margins were crashed to make prices of products more competitive.  This has affected the achievement of the targeted profitable growth.

*High receivables due to increased credit risk defaults and lower recoveries, especially from supplies to government institutions.

*Customer interaction has been sub-optimal because of the safety protocol measures instituted to curtail the spread of COVID-19.  We have deliberately shifted interaction from face-to-face engagement to digital platforms and virtual meetings, which have their challenges.

 

On the other hand, the lessons learnt have helped to plan strategically –  for instance, in situations where we place all our orders of one year with our manufacturers, at the beginning of the year.  As a result of this anticipatory action, our major business portfolio is supported by a  solid supply chain and enhanced by good stock planning and effective inventory management.

In all our operations, we have carefully and consistently maintained safety and hygiene protocol measures.  Safety measures are still in place and being reinforced.  Most of our meetings in the offices and the ones with the field force members in the major cities of the country are being organised and conducted virtually.

 

Do you share the view that government is not doing enough to enhance the ease of doing business in the country?

The ease of doing business refers to the conduciveness of the regulatory environment to the starting and operation of a local firm. This is very important because the growth of businesses in any economy provides support to government in addressing and overcoming economic challenges faced by the society like job creation, financial resources generation and in improving the standard of living of the citizens.

Nigeria improved in ranking on the latest World Bank’s ease of doing business index, rankeding 131 in the Year 2020 Index and then moved 15 places from the 2019 Index. It was a welcome development.

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Even though the government has been making efforts in recent times to improve, much more still needs to be done, especially in the area of deficient infrastructure, erratic power supply, foreign exchange shortages, high inflation, currency volatility, corruption, high capital cost, red tape, as well as excessive and unpredictable regulations.

 

How would you assess the role of Pharmacists in the fight against Covid-19?

As healthcare professionals, Pharmacists have been playing key role in the fight against Covid-19. At all levels, whether Hospital Pharmacy, Community Practice or Industry, they have been involved in providing pharmaceutical care to Covid-19 patients.

They also provide reliable information for preventing, detecting, treating and managing coronavirus infections. They have been committed to ensuring that the population has access to healthcare services and to minimize the adverse impact of the pandemic. This is quite commendable!

 

If you were to advise the Nigerian government on pharmaceutical issues, what would you tell them?

My advice to the government is that they should do more in providing infrastructural framework to check illegal importation, manufacture and sale of fake, adulterated and substandard products, due to dishonest drug dealers and some corrupt government officials. The recent 100 per cent check of containers, has no doubt, helped in greatly reducing and discouraging the importation of fake, adulterated and substandard expired goods through the ports of entry.

Government should tackle the forex crisis, as urgently as possible and help provide greater access to foreign exchange for sourcing of imported raw material and finished pharmaceutical products.

In other to enable local pharmaceutical companies in Nigeria to thrive and compete favourably with those in developed countries of the world, the government must play an active role in infrastructural development, stable power supply, stable policies, security of lives and property, creating an enabling environment, as well as developing the money and capital market for easy access to medium and long term funds.

Lastly, there is an urgent need to attract foreign direct investment, if we want our economy to grow robustly.  For this to happen, it is the responsibility of government to provide the appropriate policy frameworks, institutional structures, legal frameworks and apposite regulatory environments.

I sincerely believe that if the government employs the political will to discharge this responsibility, our economy will be the better for it and the pharmaceutical issues would be positively addressed.

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