President Bola Tinubu has enacted an executive order to eliminate tariffs, excise duties, and value-added tax (VAT) on imported pharmaceutical inputs.
On Friday, Muhammad Ali Pate, the Coordinating Minister of Health and Social Welfare, announced the order, highlighting its goal of revitalizing Nigeria’s health sector and boosting local production of healthcare products.
“In a transformative move to revitalize the Nigerian health sector, His Excellency President Bola Ahmed Tinubu, GCFR, has signed an Executive Order aiming to increase local production of healthcare products, including pharmaceuticals, diagnostics, medical devices, biologicals, and medical textiles,” Pate stated.
The Minister of Justice and Attorney General of the Federation, Prince Lateef Olasunkanmi Fagbemi, SAN, is tasked with codifying the new order.
Pate emphasized the order’s importance for the healthcare value chain initiative (PVAC_NG), approved by the president in October 2023.
“The order introduces zero tariffs, excise duties, and VAT on specified machinery, equipment, and raw materials, reducing production costs and boosting local manufacturers’ competitiveness,” he said. “This includes Active Pharmaceutical Ingredients (APIs), excipients, and other essential raw materials for manufacturing drugs, syringes, needles, Long-lasting Insecticidal Nets (LLINs), and Rapid Diagnostic Kits.”
The order also sets up market-shaping mechanisms like framework contracts and volume guarantees to support local manufacturers.
Pate explained that the order mandates collaboration among the ministers of health, finance, and industry, trade, and investment to develop a harmonized implementation framework, speeding up regulatory approvals and cutting through bureaucratic red tape.
Agencies such as the Nigeria Customs Service (NCS), National Agency for Food and Drug Administration and Control (NAFDAC), Standard Organisation of Nigeria (SON), and Federal Inland Revenue Service (FIRS) will ensure swift implementation, with special waivers and exemptions effective for two years.
“This order pivots towards market-based incentives to foster medical industrialization, reduce costs through import substitution, create economic value, and generate jobs in the healthcare sector,” the minister added.
Pate expressed gratitude to President Tinubu for his dedication to Nigeria’s prosperity and thanked all contributors to this significant milestone.
This development follows an appeal by TheCable on May 23, urging Tinubu and other leaders to address the rising cost of medications, termed “drugflation.” The appeal, based on proposals from an April 2024 webinar, called for clear executive action to tackle health sector challenges and support local manufacturers.
