Drug manufacturer, May & Baker Nigeria Plc has said pharmaceutical companies in Nigeria cut their profits to help reduce high drug prices.
May & Baker CEO, Patrick Ajah, said the company increased prices only about three times since the past year to help make drugs affordable, particularly the ones they produce.
Ajah said the skyrocketing of drugs following the exit of companies, including GlaxoSmithKline, made the Minister of Health, Muhammad Pate, rally local pharmaceutical manufacturers to find a solution.
“The pharma industry has done a lot to reduce, at least, the cost of the ones (drugs) that we produce. We are compromising our profits, our margins,” the May & Baker CEO said on Monday.
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He said pharmaceutical manufacturers could only hold out for so long until they “cannot help it anymore” as he noted that while companies “need people to be able to afford our products if we are not able to produce, it’s going to be worse.”
Ajah addressed challenges around Active Pharmaceutical Ingredients and foreign exchange impact, research and development, and corporate social responsibility during May & Baker’s recent 80th-anniversary celebration.
Stability in local pharmaceutical manufacturing is still ways to come, as most APIs used by local drug manufacturers are imported, according to May & Baker boss.
He said, “Most of, in fact, if not all the APIs are imported, including packaging materials, and so many other things that we use to produce these medicines.
“They are imported. The difference you’re going to have is if that product can be made by a company like us, the cost will be less than if you were importing the finished product.”
Ajah noted that following the Federal Government policy to float the currency, which shot the exchange rate from N461/$1 to a current N1,600, pharmaceutical companies have been struggling to buy dollars.
“The least we can get is N1,509,” he stated. “Multiply that increase by how much we buy active ingredients, like paracetamol, you find out that most companies are not making a profit.”
Ajah said that unless the Federal Government addressed the high exchange rate, pharmaceutical companies would keep collapsing and drug prices would not come down.
The May & Baker CEO said the import duties waiver recently announced by the Federal Government has remained non-implemented.
He referred to the government notice of the waiver as a “fake announcement” for which nothing has been done.
“We can make this announcement. But if it’s not implemented, nothing is going to happen. But having said that, even implementing that is not going to change much because you’re just dealing with maybe five per cent of the problem,” Ajah added.
Regardless of the monetary challenges, the May & Baker CEO recognised that without local companies securing their APIs, “things are going to keep getting worse” as he announced that the company is part of a consortium of another group of pharmaceutical companies under the PMG-MAN that is going into API.
Ajah announced that May & Baker was making inroads into vaccine manufacturing through its BioVaccine subsidiary whose priority is on routine immunisation vaccines.
He said the company got ratified by the Federal Executive Council and got the first order from National Primary Health Care to supply 15 per cent of Nigerian requirements for routine immunisation vaccines.
According to Ajah, May & Baker Research and Development would lead the company to launch about seven new products in 2024.
