New executive order key to unlocking local healthcare manufacturing potential – NAFDAC

The Director General of the National Agency for Food and Drug Administration (NAFDAC), Mojisola Adeyeye, has commended President Bola Tinubu for assenting to the Executive Order (EO) on healthcare, which aims to improve local production of health products, reduce the cost of health equipment and investments.

Mrs Adeyeye described this as a huge step towards achieving the administration’s goal of refining the health sector as the EO sets the stage for sustainable and quality healthcare.

The director general, in a statement issued on Saturday, said the decision to sign the EO underscores the president’s commitment to transforming Nigeria’s health sector.

She said: “This initiative, part of the Nigeria Health Sector Renewal Investment Initiative (NHSRII), addresses longstanding challenges and aims to improve health outcomes for Nigerians.

“It aligns with the broader objectives of the NHSRII and the Presidential Initiative on Healthcare Value Chain (PVAC).

“By addressing core challenges and providing a clear path for improvement, this EO sets the stage for a sustainable and high-quality healthcare system for all Nigerians.”

New order

PREMIUM TIMES reported that President Tinubu signed an executive order to boost local production of health-related material as a part of the national effort to revitalise the health sector.

Enhancing local production will essentially improve access to health materials and reduce the purchase cost for health seekers and providers across the country.

It will reduce the cost of medications, which has been skyrocketing in the past months partly due to the country’s over-reliance on import and foreign products.

The dependence on importation became glaring when pharmaceutical companies, like GlaxoSmithKline (GSK) and Sanofi, exited the country.

The new order introduced zero tariffs, excise duties, and VAT on specified machinery, equipment, and raw materials to give local manufacturers a “chance to excel and be competitive with multinationals dominating the market.

It exempts specified pharmaceutical machinery, equipment such as needles and syringes, biologicals, and medical textiles from tariffs and excise duties to reduce production costs and make healthcare products more affordable.

Announcing the EO on Friday, the Coordinating Minister of Health and Social Welfare, Muhammad Pate, said the order is pivotal to the success of the initiative for unlocking the healthcare value chain, which was approved in October 2023 by the President.

“It provides for establishing market-shaping mechanisms, such as framework contracts and volume guarantees, to encourage local manufacturers,” he disclosed.

NAFDAC’s effort

In the last six years, NAFDAC has vehemently pursued policies and directives targeted at boosting local production and strengthening local manufacturers, according to the agency’s DG.

These efforts, she claimed in the statement, are beginning to yield the desired result.

Mrs Adeyeye said in 2019, the agency issued the Five-Plus-Five RD directive, which sought to ensure that the capacity of local manufacturers is maximised by limiting import renewals of medicines that could be locally produced.

Two years later, she noted that the agency, through its Ceiling 34 Regulatory Directive, limited the number of medicinal products that could be imported into the country after detecting an increase in local capacity.

At the time, the director general said: “Along this path, importers started migrating to local manufacturing or forming partnerships with local manufacturers, thus resulting in a 30 per cent increase in new facilities being built.

“However, the perennial and persistent costly challenge of importation of ALL materials needed for manufacturing (except water) by local manufacturers became an open sore.

“I have advocated for zero tariffs since my assumption of office with a limited moratorium to give local manufacturers industrial breathing space to do what they know how to do best – manufacturing quality medical products,” she stated.

She noted that this zero tariff policy has come to life with the executive order signed by the president.

Implementation

The executive order, by boosting local manufacturing, will, among other things, also create jobs, stimulate economic growth, and ensure a reliable supply of essential healthcare products.

With the President’s approval, the next line of action is for the Attorney General of the Federation, Lateef Fagbemi, to take the next steps towards codifying the new order, Mr Pate earlier stated.

He said implementation of the order will be carried out by NAFDAC, alongside the Nigeria Customs Service, SON and FIRS, with special waivers and exemptions effective for two years.

He also noted that the order mandates the Ministers of Health, Finance, and Industry, Trade and Investment to develop a “harmonised implementation framework, expediting regulatory approvals and reducing bottlenecks.”