Medical Industrialisation: Pate’s Path Towards Unlocking Nigeria’s Healthcare Value Chain
By Lawal Dahiru Mamman
Sometimes in August, the International Trade Centre (ITC), a multilateral agency, revealed that the importation of pharmaceutical products into Nigeria dropped for the second straight year to $1.05 billion in 2022, a 23.4 percent decline from $1.37 billion in 2021.
The above information would have been a piece of good news. But two things are wrong here. One, the country’s importation bill for pharmaceuticals was still as high as $1.05 billion. Secondly and unfortunately, the reduction between the 2021 and 2022 figures was only as a result of worsening shortage of foreign exchange which also hindered the nation’s ability to maintain steady pharmaceutical supply products. It was not as if we commenced or improved local production and it caused a reduction in importation.
Foreign trade figures from the National Bureau of Statistics (NBS) show that Nigeria imported antimalarial drugs that were valued at a ridiculous N65.988 billion in the third quarter of 2021 and N43.472 billion in the fourth quarter of the same year. The statisticians added that the country’s pharmaceutical demands were even higher than what was imported for the respective quarters, noting that it was shortage of forex that reduced the figures to the above.
Speaking on the development, the immediate-past president of the Pharmaceutical Society of Nigeria (PSN), Sam Ohuabunwa, lamented the sad fact that such decline was only due to other economic reasons which are far from any form of improvement in local pharmaceutical production.
According to him, “the industry is facing a tremendous challenge in terms of accessing foreign exchange as over the years, access to it has reduced imports, especially for raw materials. The decline in pharmaceutical imports is not because local production has become significant as nothing much has happened in that area.
“The devaluation of the naira led to a reduction in the demand for drugs. And with high inflation and devaluation, it becomes difficult for businesses in the pharmaceutical industry to recover the price and when they try to recover it, their products become unaffordable,” Ohuabunwa added.
Dr Olubunmi Jetawo-Winter, the Executive Secretary of the Kwara State Health Insurance Agency, also bemoaned the fact that there are only 60 active pharmaceutical manufacturers in the country out of the 180 that are supposed to be in existence. He lamented the fact that only a few of these companies are involved in active manufacturing while the majority are into packaging or repackaging, despite the potential capacity of the companies to produce between 50 to 75 percent of the nation’s drug and other pharmaceutical needs.
Again, even those that engage in manufacturing get 90 percent of Active Pharmaceutical Ingredients (APIs) excipients and almost all equipment primarily from China and India, sourcing only 30 percent at home.
Away from pharmaceuticals, even for medical consumables like anaesthesia, gauze, medical masks, epidural kits, surgical tape, cotton balls, bandages etc Nigeria still relies heavily on India, the United States, China, parts of Europe, Taiwan and Brazil.
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A renowned community pharmacist, Jonah Okotie, lamented that Nigeria has become a dumping ground for any medical product and to change the narrative in other to achieve medicine security there must be, “intentionality, willingness, monitoring, infrastructure availability, support and incentivisation, affordable finance, guaranteed patronage, development of allied industries such as petroleum products relevant to pharmaceuticals, manpower development and relevant technology acquisition, and improved public perception of the industry among so many others.”
Such overdependence on imported medical supplies with a growing population of over 200 million and high rate of unemployment has remained a major setback in the country’s efforts to achieve medical security. This, experts have said, will hamper effective containment of diseases and mortality.
In April, 2023, KPMG, a multinational consulting firm, disclosed that the Nigerian unemployment rate had increased to 37.7 percent in 2022 and will further rise to 40.6 percent, due to the continuing inflow of four to five million job seekers into the labour market annually.
But the National Bureau of Statistics (NBS) after adopting an “enhanced methodology” of collecting labour market data through the Nigeria Labour Force Survey (NLFS) in line with International Labour Organisation (ILO) guidelines, announced an unemployment rate of 4.1% in the first quarter of 2023 which reduced from 5.3% in the fourth quarter of 2022. The underemployment rate, the NBS said, stood at 13.7% in the fourth quarter of 2022 and 21.2% in the first quarter of 2023.
Though experts are still debating the viability of the new method, unemployment and underemployment figures still end up running into millions of people while the nation creates jobs for others through imports as our population creates demand for products that allow them to employ more to meet our demand and other countries like ours.
With about 60 research institutes in the country like Institute for Advanced Medical Research and Training, Institute of Child Health, Institute of Human Virology, National Centre for Genetic Resources and Biotechnology (NACGRAB), National Institute for Pharmaceutical Research and Development (NIPRD), Nigeria Institute of Science Laboratory (NISLT), Nigeria Institute of Medical Research (NIMR) etc which are mandated to work collaboratively to push the frontiers of medicine and pharmaceuticals through research and innovation, Nigeria is supposed to be doing better than this.
These agencies are supposed to create jobs for the teeming population and provide drugs and medical consumables for local consumption and export. This would have made the health sector a contributor to the country’s GDP and revenue base and not just a consumer.
So when the Coordinating Minister of Health and Social Welfare, Professor Muhammad Ali Pate, talked about medical industrialisation and unlocking the medical value chain in his first press conference last weekend, there was that feeling of hope among journalists that finally, someone is looking in the right direction.
Harnessing the medical value chain, according to him, will result in industrialisation, creation of jobs and enable the sector to contribute to GDP, revenue generation and also make the sector attain some level of self-sufficiency with regards to pharmaceuticals and other medical consumables.
“The area of medical value chain and industrialisation we hope to look at. We have not attended to this over the years. 70 percent of our pharmaceuticals are imported from countries that are just like us. We don’t produce our vaccines, almost 90 percent is imported, medical equipment are imported yet we have unemployed youths.
“Unlocking the healthcare value chain is so vital, so we will do that and increase the contribution of healthcare to Nigeria’s GDP and increase the number of new jobs that can be created in the Nigerian economy. The health sector can be a contributor to national economic development too. This is not traditionally what the health sector has done but the President in his vision to transform this country has mandated us to pursue that,” he said.
The government’s desire to open up the medical value chain and pursue industrialisation in the health sector is no doubt a laudable one and the entire economy will be better for it in the long run.
