By Enyeribe Ejiogu
Leading health sector entrepreneur and Chief Executive of Fidson Healthcare, Dr. Fidelis Ayebae, is not, as would be expected, happy with the lot of the Nigeria Pharmaceutical Industry. In this interview, Ayebae who is also the Chairman of the Pharmaceutical Manufacturing Group of the Manufacturers Association of Nigeria, PMGMAN, and Board Chairman of NEM Insurance Plc, talks about what the country needs to do to prevent collapse of local drug production, which is seriously threatened by several factors.
Looking at the health sector of the economy, what is your assessment of the country’s scorecard in funding infrastructure for drug production?
My take on funding infrastructural development of the pharmaceutical industry in Nigeria is a very simple one. I know that there is paucity of funds in the country (internal revenue has declined and proceeds from oil exports have also declined) but as a country, there are some things that a government must prioritise, no matter the situation. This is very necessary to do, in the event of an emergency in a country. Health is one thing you can’t joke with. For a country of 210 million people, provision of healthcare for Nigerians has been toyed with over the years. Our budget for health is poor, it is very low in terms of the percentage of the overall budget that is allocated to the Ministry of Health. So, to fund the healthcare infrastructure in Nigeria, which goes from active pharmaceutical ingredients (API) to vaccines, research and development for diseases, whether they are chronic or lifestyle diseases, there must be a structure developed by government, working with the Federal Ministry of Finance, Central Bank of Nigeria and the DFIs (development finance institutions), to create a fund that will enable us do big ticket investments. As it is today, nobody is able to make huge health sector investments in the country. We have been talking about vaccines for a long time but Nigeria has been dancing around and paying lip service to it. Look at the case of Biovaccines Nigeria Limited. The truth of the matter is that the project won’t see the light at the of the day. Other people have gone ahead of us. Already there is a big plant inside Africa that is lying virtually unused because there are no off-takers. But they went ahead to build the plant without any commitment from any government. The firm is still figuring out what to do with that plant. Algeria or Morocco is also commissioning a vaccine plant. Even Ghana is ahead of us. In the case of Nigeria, there is still confusion as to who will fund the project – will Biovaccines take a loan or what. Why would anybody take a loan to build a plant for manufacturing vaccines whereas everywhere in the world the national policy governing vaccine is that the main off-taker is the government. Look at what former United States President, Donald Trump, did to speed up production of the COVID-19 vaccine by Moderna and Pfizer. His administration gave the companies adequate funds to produce for the government. So, if the government has not given a commitment that it will purchase the vaccines from the local manufacturer, pay for it and keep it in the national reserve, to ensure that the firm is both viable, and sustainable and that returns on investments are assured, why would anybody build a vaccine plant? An API plant is a logical extension for a serious petroleum refining country that can produce derivatives which can be synthesized to produce ingredients that are fit for drug manufacturing. So a collaboration between the pharmaceutical industry on the one hand, and a petrochemical company like Dangote Refinery and Petrochemicals as well as the government on the other, working together in a concerted effort is necessary to define how that value chain is going to be created. Whilst that is going on, another group is talking to government to formulate a proper off-takers policy on how to protect that industry. Otherwise nobody is going to put their money in vaccine production. Even the ordinary therapeutic manufacturing which we have invested in is not being protected, rather our businesses have been left to either survive or die because our borders are too open, to the extent that the commonest of drugs that should have been the preserve of local manufacturers are being imported. We do not have the mentality of putting Nigeria first when negotiating international trade relationships. Let us not be deceived by the ‘sermon’ of the World Trade Organisation (WTO) on open borders for trade. All other countries producing in Africa , such as Morocco, South Africa, Algeria or even Ghana are targeting the Nigerian market of over 200 million people because they know that we are weak when it comes to protecting our own manufacturers. No API plant can happen without government involvement, commitment, assurance of protection and establishment of a funding agency.
The challenge we have currently with vaccines is also what we are experiencing with respect to therapeutics that are for treating chronic diseases. In this country there will be an explosion of kidney diseases and life threatening diseases but we are not prepared for the looming problems.
At the level of PMGMAN (Pharmaceutical Manufacturing Group of Manufacturers Association of Nigeria), has there been any efforts to educate the civil servants who sign off on these things?
We have had series of meetings, but unfortunately nothing concrete came out of those interactions. Look at it this way, the Minister of Health or the relevant head of a regulatory agency in the health sector has a four-year tenure and the person leaves office, if not reappointed. The agreement with the Federal Government for Biovaccine has been discussed since 2002, when Dr. Joseph Odumodu was the Managing Director of May and Baker Plc. Since then, what has happened? Four people have been Health minister since that time.
The last time we had an interview for the biography of Dr. N.A.E. Mohammed, I learnt that FIDSON would be engaged in API production at the intermediary level. How has that intention progressed?
We are still at the preliminary stage; we have not yet gotten into it. We are working with the International Finance Corporation (IFC) to do a feasibility study, to be sure it will be viable, and determine which 10-15 APIs would be the best to start with. The IFC, the European Bank, the Sovereign Wealth Fund and the African Development Bank are willing to fund it, because it falls under the priority funding areas. The research by the consultant contracted by IFC is going on as I speak. It is only when the result comes out that we can know whether we will go further or not. Bear in mind that you are in a country where you have to generate your own electricity and some of the components for the APIs you want to produce will have to be imported, and the only incentive the government will give you is a four year tax holiday by the Nigeria Investment Promotion Council (NIPC). When a country is serious to build such infrastructure you don’t only get a tax holiday but also a zero-duty waiver for equipment and everything else you need for that factory.
Are you talking about the kind of waivers granted to Dangote Group for the refinery project?
Exactly. Absolutely. Zero duty waiver on the components of the API plant and other necessary equipment. Other countries go all out to prioritise availability of foreign exchange for health infrastructure development projects, but our government is not committed to all that. Unless they play their part no business person would want to go in to a debt they can’t pay just because he loves Nigeria. Yes, I love Nigeria, if not what am I doing in the pharmaceutical industry when it is one of the poorest industries. All my mates when I started just took their money and invested in bonds, commercial paper, Euro-bonds and all that and are just enjoying their lives. I am the only man in manufacturing, the mad man that went into the rough seas with a canoe and I have no protection. Unfortunately for us, the same people am talking about don’t even pay tax. But because I have an address and I am known, the Federal Inland Revenue Service (FIRS), Lagos State Internal Revenue Service (LIRS), Customs, etc, won’t allow me to rest for one day. Policemen will come to harass you even though you are not manufacturing fake drugs. It is one problem after another. There has to be a way of stemming executive rascality by various arms of government. It is no wonder that anybody that wants to set up a tea-drinking place heads to Ghana. It is not as if Ghana does not have its own difficulties but it is doing far better in terms of the enabling environment which they have created for businesses to exist and survive. I run a factory that uses gas as our main source of power – we are not on public power supply grid, we have six generators and out of the six, three are backups. For a period of three months, we did not have gas to power our gas turbines and supply was was epileptic – the pressure fluctuated badly, often dropping suddenly, forcing us to switch over to diesel generators. How do we survive as an industry in a country like this? It is so frustrating. One may ask me what I am still doing in the industry if it is so frustrating. Unfortunately, I have already invested billions of naira in structures to create jobs. I can’t sell the structures because who is going to buy them. How much will the person pay? So many of my colleagues in the industry have only remained because we have no choice, we are tired, completely fade up, very angry. How do we run a country where the whole world thinks that we are mad people, whereas we are such intelligent people yet our country and everything we do falls short of standards because our rulers are selfish, instead of creating an environment where all of us can enjoy our God given life and liberty.
What do you think should be the attitude of the government towards the pharmaceutical industry?
My position is that given the strategic nature of the drugs that we produce, the pharmaceutical industry should be treated like a strategic industry like Dangote Refinery. President Muhammadu Buhari went there and promised that the Federal Government would help in whatever way. The CBN has made a commitment to help him and NNPC even bought 20 per cent and I am sure they have paid. This is the way strategic industries are treated so that they can begin to produce quickly. If Dangote Refinery begins to produce today, I am sure the issue of fuel scarcity and subsidy would end because crude oil to be refined for the domestic market could given at very low price to enable the firm sell at discounted price. Therefore, gas should be given to industries at the lowest price so they can generate their own power. The power generated by the generating companies (GENCOs) can then be distributed to private homes, to ensure regular power supply for citizens.
Through a deliberate national policy the government should provide incentives such as protection because every country in the world protects its strategic industries; they are not left to the whims of WTO and foreign politics that will keep us all impoverished. Western companies benefit from their efforts in research and development by protecting themselves with patents for 10 to 15 years. When such products go off patent, they still want to us to open our doors for more imports of the same thing when we can manufacture in our own country. We should learn to protect ourselves. China did so more than 35 years ago. India and Malaysia followed the same path. Nigeria should learn to shut its doors for things we can produce until we build a viable country; that is the way other countries have done it. Before you import any car into India you pay 200 per cent duty. They built up their indigenous automobile industry to the extent that they could open their doors. Every car brand in the world built a manufacturing plant in India. It is this kind of concerted efforts that is required, national pride and recognition that we have no other nation apart from Nigeria.
Based on what you said about patriotic people who are still committed to Nigeria, is it not possible for those people to now lead this conversation and possibly get others to believe in it?
The fact is that no renaissance of any country is guided from the outside. Nigerians in the Diaspora can only help and support you, lend their own expertise, given the exposure in making it happen. It is first of all the responsibility of government to articulate and get the citizens to buy-in, to show their own commitment to what they have articulated and what they said they are going to do and gather support among the citizenry for a national movement that will drive that project; that is what China did. Our people in the Diaspora are a veritable resource that we can fall back on at some point when we have become serious. Those guys will not abandon what they are doing for some time where they are appreciated and come to a country where they are not.