NAFDAC, stakeholders commend FG over new executive order on local healthcare
By Fatai Kasali
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.”
Recall 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.
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.
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.”
Also, the Centre for the Promotion of Private Enterprise (CPPE) commended the recent Executive Order removing import duties, VAT, Excise duty on pharmaceutical raw materials, intermediate products, medical diagnostic equipment and machineries.
In a statement made available, the Director/CEO, Dr Muda Yusuf said that “the fiscal policy measures would boost domestic production of pharmaceutical products, reduce the cost of medications, improve access to healthcare and impact positively on the wellbeing of citizens. It would also revitalise our pharmaceutical industries and create more jobs.
“Fiscal policy measures have much better prospects of addressing supply side challenges in the economy, if well targeted. Boosting production is very vital to fixing the current inflationary pressures, driven largely by supply side challenges in the economy.”
He said, “Fiscal policy measures are potent tools for the realisation of this objective. We recommend that these fiscal policy measures should be replicated to boost production in other segments of the real sector.
“We need similar executive orders for agriculture, agrochemicals and Agro-allied industries to curb the surging food inflation; we need similar intervention in the energy sector, to promote energy security and incentivise private investments in the sector; there is need for similar support for iron and steel sector to aid the construction industry and reduce construction costs for housing and infrastructure.
“We also need fiscal policy protection to support domestic investments in petroleum refineries to conserve foreign exchange, create jobs, and deepen backward integration. There is a groundswell of economic nationalism globally and we should respond by strengthening our domestic production capabilities across all sectors.
“Fiscal policy measures have proven to be more impactful on real sector performance than monetary policy.
“The real sector of the economy deserves to be effectively protected and incentivized to improve production and ensure sustainability investments in that space. The Nigeria economy cannot afford to submit to a regime of complete trade liberalisation in the light of the challenges faced by domestic manufacturers.
“We need to stem the tide of deindustrialisation of the Nigerian economy, the exit of foreign direct investors and the rising mortality rate of domestic industries. We believe that stepping up fiscal policy interventions would facilitate the realisation of this objective. But we must be ready to trade off some revenue in the short term.
“The economy would be better off in the medium to long term, with regard to growth in domestic production, less import dependence, heightened prospects of disinflation, higher job creation and better economic resilience,” he said.
