Stakeholders have warned that the recently implemented two-year import duty and Value Added Tax waiver on pharmaceutical raw materials may underperform if the Federal Government does not address deeper systemic challenges in infrastructure and personnel.
In separate phone interviews, pharmaceutical manufacturing stakeholders told The PUNCH that while the tax waiver is a major step in boosting local drug manufacturing, gaps from an infrastructure deficit, financial constraints, and regulatory challenges to human resources need attention.
Chairman of the Lagos Chamber of Commerce and Industry Medical Group, Dr Niyi Osamiluyi, welcomed the waiver as a commendable policy move but warned that without tackling unreliable power supply, poor transport infrastructure, limited access to finance, and regulatory bottlenecks, the gains of the waiver may be eroded.
“A holistic approach that includes infrastructure development, financial incentives, and regulatory reforms is essential to achieve comprehensive healthcare coverage,” Osamiluyi said. “Persistent issues such as unreliable electricity supply, poor transportation networks, and inefficient port operations can increase production costs and delay the distribution of medical products.”
He added that financial constraints remain a major hurdle, noting, “Local manufacturers struggle to access affordable credit, which is crucial for scaling operations and maintaining quality standards.”
The LCCI Medical Group chairman also submitted that regulatory delays and a shortage of skilled professionals in pharmaceutical manufacturing need urgent government intervention.
He explained: “Complex and time-consuming regulatory processes can deter investment and slow down the introduction of new products to the market. Streamlining these processes is vital for encouraging innovation and ensuring timely access to medicines.”
The PUNCH reported that the Coordinating Minister of Health and Social Welfare, Prof. Muhammad Pate on April 27 disclosed plans to establish a new pharmaceutical manufacturing training institute named Empower Academy Nigeria, in partnership with Empower Swiss, Geneva as part of efforts to increase local manufacturing of pharmaceutical products in Nigeria to at least 70 per cent by 2030.
Osamiluyi lauded the waiver covering active pharmaceutical ingredients, excipients, packaging materials, rapid diagnostic kits, and long-lasting insecticidal nets, among others.
He noted that the initiative comes at a critical time, especially after the exit of multinational pharmaceutical companies, including GlaxoSmithKline and Sanofi, from Nigeria, due to harsh operating conditions.
Similarly, a former President of the Pharmaceutical Society of Nigeria, Olumide Akintayo, welcomed the implementation policy announced by the Nigeria Customs Service but stressed the need for concrete action beyond announcements.
“On the surface, the Customs waiver is a welcome development,” Akintayo said. “But you only know if it is working when it is operationally effective , when manufacturers actually experience the relief in real transactions.”
He commended the Federal Government’s political will but insisted that a presidential committee should be set up specifically for the pharmaceutical sector to drive reform across the value chain.
“This committee can address long-standing issues like the National Drug Distribution Guidelines, which remain unimplemented,” he stressed.
Akintayo criticised what he described as lopsided appointments in the health sector that favour medical practitioners to the detriment of pharmaceutical professionals. He lamented unequal representation in the political leadership of the pharmaceutical sector as a personnel risk to governmental efforts.
“The pharmaceutical sector is a trillion-dollar global market. It must be treated as a major industry in its own right,” he said.
He cautioned that unless government efforts are matched with sector-wide reforms, the country risks missing out on the full benefits of the waiver, querying “Are we really crashing drug prices? Are we supporting local entrepreneurs to manufacture APIs? That’s the bottom line.”
On March 26, 2025, the NCS announced the two-year waiver exemption, granting eligibility to 87 pharmaceutical companies approved by the Federal Ministry of Health and Social Welfare.
Only firms with valid Tax Identification Numbers are allowed to benefit, according to Assistant Comptroller and National Public Relations Officer, Abdullahi Maiwada.
