Congo and Nigeria s localization efforts hit Indian pharma MSMEs

Mumbai, December 13, 2021:

The steps taken by Democratic Republic of Congo (DRC) and Nigeria, the two sub-Saharan African countries, to reduce import of drugs have hit pharma micro, small and medium enterprises (MSMEs) in India.

DRC, the largest country in sub-Saharan Africa has released a list of 35 pharmaceutical products that can be manufactured by the local pharmaceutical industry in the country. The list includes amoxicillin, chloramphenicol, ciprofloxacin, cotrimoxazole, cyproheptadine, doxycycline, erythromycin, mebendazole, metronidazole, meprobamate, multivitamin tablets, vitamin B1, B6, B12, vitamin C syrup, paracetamol, phenoxymethylpenicillin, promethazine, tetracycline, etc.  

The country has banned import of these drugs with immediate effect thus putting Indian pharma MSMEs which have a significant exposure to it in a fix.

India and DRC signed an agreement on mutual promotion and protection of investments on April 13, 2010. A large portion of DRC’s pharmaceutical imports is sourced from India, some for re-export to neighboring countries like Republic of Congo, Gabon and the Central African Republic.

On the other hand, in a bid to promote domestic production of drugs, the National Agency for Food and Drug Administration and Control (NAFDAC), Nigeria has also come out with a ceiling list of 36 pharmaceutical products which can not be registered by the foreign drugmakers in the country.

The list comprises ampicillin, indomethacin, tetracycline, sulphadoxine, ibuprofen, alcohol based hand sanitizer, piperaquine, paracetamol, albendazole, mebendazole, pseudoephedrine+paracetamol+caffeine FDC, piroxicam, diazepam, amlodipine, chlorpheniramine maleate, ciprofloxacin, cimetidine, vitamine C, amoxicillin, topical penicillin, erythromycin, salbutamol, metformin, griseofulvin, bisacodyl etc.

In Nigeria, regulations allow local drug manufacturers to also be drug importers. Many of the leading local drug manufacturers are also representatives of global drug originators, and hence have a strong incentive to invest in local drug registration and the introduction of lucrative new products. Very few markets in Africa are as potentially lucrative as Nigeria.

India’s drug export to Nigeria was US$ 410.16 million during 2020. In a bid to boost the medicine export from India to Nigeria, the Indian government established warehousing facilities back in 2014.

Upset with this, Indian MSMEs which are exporting medicines to DRC and Nigeria are now looking at the Union ministry of commerce and industry and department of pharmaceuticals to protect their interest.

Madhya Pradesh Small Scale Drug Manufacturers general secretary Amit Chawla said, “Africa is a leading market for Indian pharmaceuticals. At a time when the Indian government is looking at the African region to boost MEMEs exports, two sub-Saharan African countries’ decision to ban import of several pharmaceutical products which are mainly manufactured by Indian MSMEs is a setback to the government’s initiative. It is also a setback for MSMEs which have a significant exposure to the sub-Saharan African region. This would result in a significant forex loss as well as greater job losses in India.”

As per the Nigerian government’s decision, drugmakers exporting the selected pharmaceutical products to the country are not able to re-register their products once their registration expires, said Chawla.

MSMEs are facing a double whammy of skyrocketing prices of raw materials and losing foreign markets, he said.

“India’s pharmaceutical exports grew 18.7 per cent to US$ 24.44 billion in the financial year ended March 31, 2021 spurred by strong demand for the country’s generic drugs. It is one of the major foreign exchange earner industries in the country. The commerce ministry and department of pharmaceuticals need to chip in to protect the interest of MSMEs,” he added. PharmaBiz