National competitiveness: Creating the impossible


Some things are impossible until they happen. One of such, I believe, would be the emergence of Nigeria as a global power with a very competitive national economy. Till then, there is no harm in discussing how best we can make things happen even when they appear impossible to many.
From a pharmaceutical industry perspective, it is the stated conviction of many others beside this author that a lot of headway can be achieved by the mutual commitment of concerned stakeholders towards specific objectives. As our nation transitions to a new leadership, it is important that we keep certain issues on the front burner. However, before we proceed to mention specific areas of intervention, it is important to mention the five pillars of successful advocacy:
A. Ability to generate and communicate evidence
B. Intra-sectorial stakeholder engagement
C. Long-term partnerships and networks
D. Sufficiency of resources
E. Ability to effectively assess risks

With the above in mind, we could progress by considering the Porter’s Diamond Model of national competitiveness. The Porter’s Diamond, developed by Prof. Michael Porter of the Harvard Business School provides a very popular tool for analysing national competitiveness.
The essential thought behind this model is that it is the interplay of these four factors in every nation that determines the level of competitiveness of a particular industry in that nation compared to other nations. Using the pharmaceutical and health care industry as our case study, a comparative assessment of the level of human and material resources (factor conditions) with that of North American nations, India and China provides useful insights.
A study also of the demand conditions (the local and neighboring markets) – the size, complexity and mobility –will provide further clues and then the character of the supporting industries and the nature of the firms – their set up, organization, rivalry and regulation. Improving our national competitiveness therefore can be done by interventions that target either or all of these four areas and for each area, there are different stakeholders to engage. Our focus, however, is on the pharmaceutical and health care industry.

Demand conditions
In virtually every report on the Nigerian pharmaceutical industry, a mention is usually made of the chaotic drug distributorship network. The chaotic drug distributorship network is a characteristic feature of our demand conditions that constitute an area of intervention. Also, the size of the local market which is not too large, compared to that of nations like India, China and even South Africa is an indicator of the challenges of the manufacturing sector.
Increasing the size of the local market by interventions like the NHIS-based dedication of 1 per cent of Nigeria’s revenue earnings to primary health care would result in an increased domestic demand. This demand of course would also grow with the size of Nigeria’s GDP and the rise in chronic diseases. Expanding to other West African markets can also be achieved by standardising regulatory procedures such that products registered in any West African country can be sold in member states.
An assessment of the size of the demand which is served by indigenous firms would also point to the competitiveness of the nation. An import-dependent scenario would suggest that other factors like supporting industries, factor endowments and firm structure do not support local production and vice versa or that the prevailing policies do not compel such.

Hoodlums Loot Tramadol, Codeine, Others from Kaduna Warehouse

Factor conditions
The brain drain syndrome is a very big challenge for Africa in general and there are no immediate signs that it is abating. For the health care industry, we do have an emergency. For example, Nigeria is 127th on the physician density ranking and Cuba is 1st(2012).
The salient fact here is that doctors work in hospitals and a low physician population implies a low hospital density which directly affects the size of the pharmaceutical and health care industry. In coherence with this reasoning, Nigeria is 166th on the global hospital bed density ranking (CIA World Fact Book, 2012).
If Nigeria were to dedicate 1 per cent of her revenues to primary health care through a NHIS structure as enshrined in the recently signed Health Bill, the figure would be in the neighbourhood of $300 Million. Assuming the entire amount was placed in a co-pay health insurance plan of N12,000 per person/annum (this is the official rate of the NHIS Adoption Tree health plan) where participants or their state government pay half the sum and the Federal government the rest. That is, at N6000 copay per person, the $300 Million would account for 10 million Nigerians.
The WHO-recommended norm is one doctor per 1,000population; hence, ideally to serve these 10 million Nigerians, we would need 10,000 medical doctors at the primary care level. At present, Nigeria has about 30,000 practising physicians, according to the Nigerian Medical Association, of which 6000 are in Lagos alone.
The point is that throwing money at the problem is good but it is not enough; we need to have more schools to train health care personnel and to create institutions where they can work. Assuming someone gives us enough money throughan insurance scheme to cover 100 million Nigerians, we would need about 100,000 doctors to meet that demand. Considering that Nigeria’s population would double by 2050 (35 years from now) and the average gestation period for training health care personnel is six years, we need a lot of pace to catch up.
Personally, I think we need to invest seriously in telemedicine to be able to maximise the number of doctors that we have without compromising on the quality of care. Besides the numerical strength of our human resources, other factor conditions like the quality of our knowledge base are another challenge. This is one area that Nigeria could gain from the diaspora community. Interventions designed to increase our human resource capacity must be made to reflect present and emerging needs.

UN Urges Coordinated Approach to COVID-19 Fight

Related and supporting industry
The pharmaceutical industry, for example, is dependent on other industries like the petrochemical industry, the agricultural industry, the financial industry, the health insurance industry, the packaging industry, the mechanical engineering industry and the power sector.A consideration of the development of these sectors, in part, informed Prof Charles Soludo’s dialogue in a paper titled, “Can Nigeria’s Manufacturing and Pharmaceutical Industry Compete?” presented to the Nigerian Association of Industrial Pharmacists in 2011. In it, he noted that the pharmaceutical industry cannot compete in a non-competitive manufacturing environment without creating islands of competitiveness.
Creating such islands of competitiveness, for example, would involve perhaps designing a special pharmaceutical fund. Note that when different aspects of an economy are seeking specialist funds, it is an indicator of the level of development of the nation’s financial industry. Fostering the supporting industries could also involve special medicinal plant projects involving the ministries of agriculture and science and technology, led by the private sector.

UI Alumni Association Plans Cancer Centre

Firm strategy and structure
There are a lot of attempts at the moment to tweak the legislation that affect the ownership of retail pharmacies – the result of which would be greater influx of cash to this sector, resulting in the development of chain pharmacies and of a host of newcomers to the retail pharmacy space enjoyed by pharmacists at the moment.
Such decisions are for the government to make.Though this particular step will bring an immediate increase to the competitiveness of the pharmaceutical sector, it is also the belief of this author that if other issues raised in these articles are treated, the retail subsector of the Nigerian pharmaceutical industry would achieve an organic growth without major changes in legislature.
Another major concern is the intellectual property regime. The fact that Nigeria’s patent law is non-examining means that patent practitioners – individuals who should be filing patents – have not been examining existing patents to see if they can file something new. I was not a little bit surprised as a rookie research and development consultant that some of the pharmaceutical research scientists I was working with had never seen a patent document, not to talk of students in our universities. The direct result of this state of affairs is the observed low absorptive capacity of our industries. It is difficult for industry to absorb something that is not there in the first place. From experience, I know that when a research scientist sees a patent, the first comment is “I can do this.”

We can do this
In conclusion, there are so many areas of interventions within the outlined areas above. As individuals, we cannot do all of them, so we all have different areas of contribution. As a group, we can contribute to these different areas at the same time. A structured mediating centre that coordinates these activities would help in ensuring we arrive at our destination.
According to a popular Igbo adage, it is when someone wakes up that is his morning. So, I might as well conclude this piece by saying, “good morning”.



Please enter your comment!
Please enter your name here