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Why drug prices may rise by 100% in six months

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OPEN DRUG MARKETS… associated with fake drugs, medicines abuse and misuse… inset is Chairman of PSN (Lagos Chapter), Bolanle Adeniran


*Pharmacists, LCCI urge NAFDAC to reverse 350% hike in registration fee for medicines
*PSN says situation will fuel faking, product abuse, misuse, discourage local manufacturing

If nothing is done urgently to reverse the 350 per cent hike in product registration fees by the National Agency for Food and Drug Administration and Control (NAFDAC), there would be drug scarcity in Nigeria occasioned by 100 per cent increase in medicines prices within the next six months.

This is the position of pharmacists under the aegis of the Pharmaceutical Society of Nigeria (PSN) who have urged the Agency to reverse the hike in registration fees. They said the hike would lead to rise in fake drugs as well as medicine abuse and misuse; and consequently discourage local production. The PSN warned that if the hike were not reversed immediately, there would be 100 per cent increase in drugs prices within the next six months.

Chairman, PSN (Lagos State Chapter), Bolanle Adeniran, enjoined the Lagos Chamber of Commerce and Industry (LCCI) to collaborate with NAFDAC to smoothen its unduly long registration procedures, put in place rules of engagement to resolve challenges of the output of its hi-tech regulatory tools which are sometimes out rightly preposterous as it affects the relevant health professional who conducts his practice/business.

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Adeniran, who was a guest speaker, at an event organized by LCCI in Lagos tagged “Ease of doing healthcare business with NAFDAC, SON and Nigeria Customs Service” said: “Stakeholders must prevail on NAFDAC to reverse the 350 per cent hike in registration fee as it is an ill wind that will bring no good to all concerned. As a matter of fact, it would incentivise fake drug dealers who will bring in their deadly merchandise at cheaper rates relative to expensive registered products. The challenges in drug distribution will allow retrogression in the gains and momentum of the drug misuse/abuse menace in our country.

“Today we continue to lament the diminishing value and impact of the Pharma Sector in the national economy. Presently, the total size of the Pharma Sector is a meagre $2b while local drug manufacturing contributes less than 2 per cent to National Gross Domestic Product (GDP). These poor indices will diminish further as the regulatory environment makes operators more vulnerable to vacillations of the consuming evil that lurks.”

The pharmacist said NAFDAC has not been able to conquer the bureaucratic delays associated with registration of drugs and related products. She said in some bizarre instances, this still take over two years to accomplish registration status. Adeniran further explained: “While the industry was grappling with challenges of delays, NAFDAC made a most damaging move in the last couple of weeks by increasing drug and product registration tariff by a whooping 350 per cent. Specifically, it now costs N1.05 million to register a prescription only medicine from N350,000.00, while Over The Counter (OTC) drugs have moved from a hitherto expensive N1 million to N4 million in Nigeria. NAFDAC must have invoked the spirit of Section 5(f) of the enabling Act, which empowers it to ‘undertake the registration of foods, drugs, cosmetics, medical devices, bottled water and chemicals’.”

She added: “In the light of the foregoing, the PSN (Lagos State Branch) has analysed NAFDAC’s 350 per cent increase and we respectfully declare that there is absolutely no basis for such in terms of improvement in the economic fortunes in our industry or a propensity for drastic improvement in service, provisioning a vital index in the ease of doing healthcare business in Nigeria. If this draconian policy is not reversed or immediately remedied, the PSN (Lagos State Branch) wishes to warn through this forum that Nigeria will experience at least a 100 per cent increase in drug prices in about six months with grave consequences of morbidity and mortality to consumers of health in our nation.”

The pharmacist said the Federal Government must sensitise Nigeria Customs Service that drugs are life saving entities, which need some level of prioritization and that processing of “Form M” and Pre-Arrival Assessment Report (“PAAR”) must therefore be accelerated by the industry.

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She explained: “…On an official basis, the Nigeria Customs Services (NCS) subjects all importers of drugs and pharmaceuticals excipients to processing ‘Form M’ before they proceed to import. When the consignment arrives, the Nigeria Customs Services set a condition precedent of prospective importers processing PAAR before batches of goods can be cleared.

Experientially, the pharmaceutical importers are at the mercy of the NCS portal, which sometimes malfunction and therefore delays the clearing process with sometimes excruciating financial consequences to the importers. “The other fundamental issue which is very significant is that the NCS takes a position it does not charge duties on drug imports. Realistically however, depending on the HS codes, importers pay the reflected rates, which includes: Comprehensive Inspection Supervision Scheme of 1 per cent; ECOWAS Trade Levy Scheme of 0.5 per cent; and Levy of 20 per cent.

“These percentages are a function of Cost, Insurance and Freight (CIF) of the drug imports and this transcends to huge costs which are ultimately passed on to consumers.” Adeniran said the Federal Ministry of Finance and Nigeria Customs Services must also tidy the tariff regimen of drug excipients, imports and other gadgetry in tandem with the operating environment.

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