Akintayo: We are supposed to produce 70 per cent of our local drug needs
The cost of prescription drugs is skyrocketing, and is posing a lot of concern to Nigerians. Dr. Olumide Akintayo, immediate past president of the Pharmaceutical Society of Nigeria (PSN) told GERALDINE AKUTU why prices of drugs are going up.
Drugs are becoming too expensive, why is this so?
It is very true that drug prices have skyrocketed in recent times. The factors responsible for this are multifaceted. A cursory look will confirm that the two major sources of sourcing drugs in our country are via local manufacturing and importation. For a country that does not have petrochemical plants, manufacturing is only probably at a tertiary level. This is because all the Active Pharmaceutical Ingredients (APIs), excipients, packaging materials, equipment and so on are imported.
I am sure you are familiar with the tragic foreign exchange rate, which is almost $1 to N500. This factor definitely affects both manufacturers and importers with dire consequences, in terms of financial torture to consumers of health. Another major factor, which is gradually taking its toll on drug prices, is the unfortunate delay associated with the composition of our major regulatory agencies, especially NAFDAC and PCN. When you contend with acting managements and sole administrator’s ad-infinitum, it is only logical to encounter avoidable hiccups and challenges.
Today, NAFDAC has created gaps in the availability of life-saving medicines, because it is impeding marketing authorisation of some life-saving products on grounds that it (NAFDAC) has not visited the manufacturing plants in the country of production of these products, so they are not registered. When you deliberately narrow choices, you surreptitiously create a monopoly. If competitiveness is not upheld in a marketing environment, then consumers will naturally suffer. It is on this score that one appeals to President Buhari to immediately re-constitute NAFDAC and PCN, albeit lawfully, to enable us drive a benevolent agenda for the Nigerian people.
Could the competition between manufacturers and importers be based on interests?
I know that a few developments in the ranks of players in our industry in the last few days motivated your question. Our industry is very strategic, because it is always about interventions to save lives. This is why drugs are a priority line of defence in the category of food, clothing and shelter.
As a community pharmacist, who has also been in representative capacity, I am privileged to know that we run a national drug Policy 2005, which advocates as a main thrust, the availability and affordability of safe and efficacious medicines in the health system. Ideally as a nation, we are supposed to produce 70 per cent of our local drug needs. As an erstwhile president of the PSN, we have alerted government ceaselessly on the security implications of a tendency not to protect the local drug industry and I can go on and on. I am briefed that there are over 120 companies, which indulge in local manufacture of drugs.
These companies have installed, but often underutilised capacity for a range of our essential medicines. For a fact, as far back as 20 years ago, only two of our local manufacturers had installed capacity to produce all the liquid installed dosage needs for the entire West African regions.
If Nigeria will be great, we must grow the real sector, so that local manufacturing of drugs and indeed, other sectors remain the way forward. My worry, however, is that successive governments have never incentivised manufacturing. I know of a manufacturer, who runs a factory in the N5bn range, including a fleet of generators worth over N700m. How do you ensure competitiveness of made-in-Nigeria drugs with diesel generators at N260 per litre, coupled with a forex rate of $1 to N500? It certainly does not look attractive, which is why government must come up with strategies to boost local manufacturing.
There is always a difference between reality and expectation. In this regard, installed capacity does not seem to me to transcend to utilised capacity for most of our manufacturers.
Nigeria, a major sub-regional super power had supported ECOWAS position that since there was a dearth of medicine manufacturers in the West African region, a need arose to meet the gap in supply through affordable imported drugs. The pragmatic way to achieve this was charge zero or insignificant duties on medicines.
Even before the ECOWAS position, the World Trade Organisation (WTO), which Nigeria subscribes to in 1988, recommended not more than five per cent duty on medicines, because of its life-saving nature. I guess this was why Nigeria adopted the ECOWAS position of zero percent duty in 2013.
Government must continue to properly evaluate its policies, so that outcomes do not jeopardise existing policies. Earlier, I said the NDP 2005 advocates affordability and availability of safe and efficacious medicines, so the logical question to ask is, how can a medicine imported at $1 to N500 with a 20 per cent import duty charge and other clearing charges be affordable in good conscience?
In Nigeria, we say 65 per cent of clinical visits are malaria based and we insist via our national malaria policy that only ACTs must be dispensed. It is a statement of fact that less than 10 of our 120 local manufactures have installed and utilised capacity to manufacture anti-infectives, which are key to saving lives, yet we do not certainly produce enough locally whether they are solid, liquid dosage forms or injectables.
If about seven out of 10 Nigerians will consume ACTs daily in 2017, I am experienced enough in pharmacy matters to posit that we cannot generate the over 126 million doses of ACTs we need daily through our local industry.
What would happen, therefore, is a further skyrocketing of prices, because this is a country, where our healthcare expenditures is borne through out of pocket expenses in over 70 per cent of discourses. The end result will be calamitous, and we shall record more deaths. Statistically, malaria alone killed 200,000 people in 2015, according to health record, when prices of anti-malarias were an average of N500 per dose.
My very strong appeal to our players in industry is to face the realities on both sides of the divide, whether as manufacturers or importers. Nigeria must work towards self-sufficiency in local production, because it is the hallmark of progress in every decent clime. But in the interim, I would canvas, albeit responsibly, a staggered import duty regime on finished products, especially for anti-malarias, anti-infectives and some analgesics/anti-inflammatory agents.
An import duty of five per cent in the next three years may be more appropriate for life- saving drugs. This may be reviewed upward to about 10 per cent in another three years, when we confirm an increase in installed and utilised capacity of our local industry.
We must, therefore, continue to strike a balance between economic realities and our various laws. I don’t indulge in congressional hypocrisy and will not stand on hypocritical platitudes to present a rosy picture of manufacturing endeavours. If government rises to the challenge, our local manufacturers, at least in the pharmaceutical sector, can contribute significantly to improve national gross domestic product (GDP).
What are pharmacists like you doing in this regard?
Networking with the key stakeholders in pharma manufacturing and importation. I believe the Pharmaceutical Society of Nigeria (PSN) should ultimately bring these players together, so they can present a common front to government. Our unity of purpose in 2015 gave rise to the new methodologies put in place, with regards to drug distribution in open markets. We are winning that battle today. So, I would strongly call on captains of industry to imbibe statesmanship spirit to strike the right cord in the week ahead.