FG PLANS TWO-YEAR EXTENSION OF PHARMACEUTICAL MANUFACTURING EXECUTIVE ORDER TO BOOST LOCAL PRODUCTION
By Iroyin Yoruba Television
The Federal Government has indicated plans to extend the Presidential Executive Order supporting local pharmaceutical manufacturing by another two years, a move expected to provide additional policy continuity for manufacturers investing in domestic drug production and help Nigeria reduce its dependence on imported medicines.
The proposed extension was disclosed on Friday, October 2, 2026, following discussions at the eighth Nigeria Pharmaceutical Manufacturers Expo held in Lagos.
The government said the extension would support efforts to strengthen medicine security, increase domestic manufacturing capacity and position Nigeria as a stronger pharmaceutical manufacturing centre within Africa.
The existing executive order is scheduled to expire in March 2027.
Under the proposed extension, the policy would continue until March 2029.
The announcement is significant for pharmaceutical manufacturers because the sector requires substantial investment in factories, machinery, research, raw materials, quality-control systems and other infrastructure.
Manufacturers have argued that long-term policy certainty is important when companies are deciding whether to commit additional capital to expanding production.
The Federal Government's proposed extension therefore comes at a time when Nigerian pharmaceutical companies are seeking to increase their production capacity and reduce the country's reliance on imported medicines.
The Minister of State for Health and Social Welfare, Dr Iziaq Adekunle Salako, said the government remained committed to expanding domestic pharmaceutical manufacturing as part of efforts to strengthen medicine security, healthcare resilience and economic development.
He said the pharmaceutical industry needed stronger capacity across the entire value chain.
That value chain includes research and development, sourcing of active pharmaceutical ingredients, sourcing of excipients, formulation, manufacturing, quality assurance and distribution.
The minister also called for increased investment in advanced pharmaceutical production, including vaccines, biologics and other critical health technologies.
The proposed extension is expected to give manufacturers more time to plan investments around the existing policy incentives.
For businesses, the timing of government policies can influence investment decisions.
Pharmaceutical manufacturing plants require large amounts of capital, and investors generally need to know whether tax and tariff arrangements will remain stable long enough for projects to become commercially viable.
The executive order was introduced to support local production by reducing some of the costs associated with pharmaceutical manufacturing inputs and equipment.
The policy includes tariff and tax measures covering specified pharmaceutical machinery, active pharmaceutical ingredients and excipients.
The objective is to make it easier for domestic manufacturers to obtain the materials and equipment needed to produce medicines locally.
The policy is part of a broader government strategy to reduce dependence on imported healthcare products.
Nigeria has historically relied heavily on imported medicines and pharmaceutical inputs.
That dependence can expose the country to international supply disruptions, foreign-exchange pressures, shipping costs and changes in global prices.
Increasing domestic production can provide an additional source of supply.
It can also create opportunities for Nigerian manufacturers to develop production capacity that can eventually serve markets outside the country.
The government is targeting increased domestic production of essential medicines.
Industry representatives have said that Nigeria still imports a substantial proportion of the medicines consumed in the country.
At the Nigeria Pharmaceutical Manufacturers Expo, manufacturers called for continued policy support to allow companies to expand their factories, acquire modern equipment and develop additional production lines.
The industry also identified several challenges that continue to affect pharmaceutical manufacturing.
These include high energy costs, supply-chain difficulties, port-related delays and limited access to long-term financing.
Manufacturers also face challenges associated with obtaining pharmaceutical raw materials.
Many active pharmaceutical ingredients are still sourced from outside Nigeria.
Developing local production of these ingredients could reduce some of the country's dependence on imported inputs.
However, building an API manufacturing industry requires specialised technology, skilled personnel, research capacity and significant investment.
The government's proposed extension therefore covers a sector in which several stages of localisation are still being developed.
Local manufacturing does not simply mean assembling imported materials into finished products.
A fully developed pharmaceutical industry requires research, formulation, production, testing, packaging and quality assurance.
It also requires regulatory systems capable of ensuring that medicines produced locally meet appropriate safety and quality standards.
The National Agency for Food and Drug Administration and Control plays a major role in that process.
NAFDAC Director-General Professor Mojisola Adeyeye said 37 local pharmaceutical facilities were currently being upgraded to meet international manufacturing standards.
The upgrades are intended to improve the ability of Nigerian manufacturers to produce medicines that can compete in wider markets.
Meeting international standards is particularly important if Nigeria wants to increase pharmaceutical exports.
The African Continental Free Trade Area provides a potential market for Nigerian manufacturers.
A company that can meet the regulatory requirements of other African markets may be able to sell medicines across multiple countries.
However, differences in regulatory systems can create barriers.
Manufacturers may have to satisfy different registration, testing and quality requirements in different countries.
Greater regulatory harmonisation could reduce those barriers.
The African Medicines Agency has been working toward stronger cooperation among African regulatory authorities.
The Director-General of the African Medicines Agency, Dr Delese Mimi Darko, has called for greater regulatory harmonisation to help manufacturers access African markets.
For Nigerian pharmaceutical companies, regional market access could increase the potential return on investments in production facilities.
A factory serving only the Nigerian market has a different potential scale from one capable of exporting to multiple African countries.
Regional trade could therefore encourage manufacturers to increase production capacity.
The government's proposed extension of the executive order is taking place within this wider industrial strategy.
The objective is not only to produce more medicines for Nigeria but also to develop an industry capable of competing regionally.
Industry representatives have said that policy consistency is essential to achieving that objective.
The Pharmaceutical Manufacturers Group of the Manufacturers Association of Nigeria represents more than 200 local manufacturing companies, according to industry statements made during the expo.
The group has asked the Federal Government to extend the executive order beyond its original March 2027 expiry.
Its argument is that manufacturers need additional time to deepen investments already made under the current policy.
Companies may be reluctant to make large investments if they are uncertain about the future of incentives affecting their operating costs.
A two-year extension would provide additional time for businesses to complete projects and expand production.
It could also give investors greater visibility when assessing new pharmaceutical projects.
However, policy incentives alone cannot solve all the challenges facing the sector.
Manufacturers also need reliable electricity.
Pharmaceutical production involves specialised equipment and strict environmental and quality controls.
Interruptions in electricity supply can increase operating costs when manufacturers have to rely on generators or other backup systems.
Energy costs can therefore affect the competitiveness of locally produced medicines.
Financing is another major issue.
Pharmaceutical manufacturing projects can require substantial capital before they begin generating revenue.
Businesses need access to financing with repayment periods that match the long-term nature of manufacturing investments.
The Federal Government has been promoting financing initiatives intended to support the healthcare value chain.
Officials have said that approximately $2 billion in financing commitments have been secured under the Presidential Initiative to Unlock the Healthcare Value Chain, with several Nigerian health companies in discussions for funding.
Such financing could provide additional capital for manufacturers seeking to expand.
The availability of capital, however, is only one part of the investment equation.
Manufacturers also need access to technology.
Modern pharmaceutical production requires specialised equipment and quality-control systems.
Companies may need to invest in laboratories, production lines, packaging technology and automated systems.
The executive order's provisions concerning machinery are intended to reduce some of the costs associated with importing such equipment.
If the policy is extended, companies could continue benefiting from the applicable reliefs for qualifying machinery and inputs.
This could make some expansion projects more financially viable.
The policy could also encourage companies to invest in new categories of medicines.
Nigeria's pharmaceutical industry includes manufacturers of essential medicines, antibiotics, antimalarials, pain medication and other products.
The government wants manufacturers to expand into more sophisticated areas, including vaccines and biologics.
Those areas require greater research capacity and more advanced manufacturing systems.
Developing such capacity could take several years.
A stable policy environment could provide companies with more time to plan those investments.
The proposed extension to 2029 therefore has implications beyond immediate production.
It could support longer-term industrial planning.
Companies could assess whether to upgrade existing factories, establish new production lines or develop new product categories.
Investors could also examine opportunities to form partnerships with Nigerian manufacturers.
Technology partnerships could help local companies acquire expertise in specialised production.
Research institutions could contribute to the development of new medicines and technologies.
Universities and pharmaceutical companies could collaborate on research and training.
The development of skilled pharmaceutical workers is another important part of the sector.
A modern pharmaceutical industry requires pharmacists, chemists, microbiologists, engineers, laboratory scientists, quality-control specialists and other professionals.
As production capacity expands, demand for skilled workers can increase.
This creates potential employment opportunities.
It can also encourage professional training and knowledge transfer.
However, the industry needs to ensure that graduates have the skills required by modern manufacturing facilities.
Investment in training therefore needs to accompany investment in factories and equipment.
The proposed policy extension also has implications for Nigeria's medicine-security objectives.
Medicine security means having reliable access to essential medicines when they are needed.
A country that depends heavily on imports can be vulnerable when international supply chains are disrupted.
The COVID-19 pandemic demonstrated how quickly global supply chains can be affected by emergencies.
Other disruptions, including international conflicts, shipping problems and currency volatility, can also affect the availability and cost of imported medicines.
Domestic manufacturing can provide an additional layer of resilience.
It cannot necessarily eliminate imports entirely, because some pharmaceutical ingredients and specialised products may still need to be sourced internationally.
However, greater local production can reduce dependence on external suppliers for a larger proportion of essential medicines.
This is one of the reasons the government is pursuing local pharmaceutical manufacturing.
The business implications are also significant.
A stronger pharmaceutical manufacturing industry could create demand for local packaging companies, logistics firms, laboratory-service providers, engineering companies and other suppliers.
Factories need packaging materials.
They need maintenance services.
They need transportation.
They need laboratory testing.
They need specialised equipment.
Each activity can create additional opportunities for businesses.
The economic impact therefore extends beyond the pharmaceutical companies themselves.
A growing pharmaceutical manufacturing sector could also support Nigeria's industrial diversification.
The country's economy has historically depended heavily on oil revenues.
Developing manufacturing industries can provide additional sources of economic activity.
Pharmaceutical production is particularly significant because it combines manufacturing, science, technology and healthcare.
A successful pharmaceutical industry can therefore contribute to both economic and public-health objectives.
The proposed extension is intended to help maintain momentum in that development.
Industry representatives have also asked the government to address structural challenges affecting production costs.
High electricity prices can increase manufacturing expenses.
Poor infrastructure can increase logistics costs.
Port delays can slow the arrival of raw materials and machinery.
Foreign-exchange challenges can affect the cost of imported inputs.
Limited access to long-term financing can delay factory expansion.
These factors can make locally manufactured medicines more expensive than imported alternatives in some circumstances.
Reducing these constraints is therefore important if local manufacturers are expected to compete effectively.
The government has indicated that it wants to use fiscal incentives, financing mechanisms and regulatory reforms to support the sector.
The proposed executive-order extension is one component of that approach.
Manufacturers, however, will also need to improve efficiency and productivity.
A policy incentive can reduce some costs, but companies must still operate commercially.
They need efficient production systems, strong management, quality control and effective distribution.
The ability to produce medicines competitively will influence whether local manufacturing can gain a larger share of the domestic market.
The regional market provides another opportunity.
If Nigerian manufacturers can meet international quality requirements, they may be able to export to other African countries.
The African Continental Free Trade Area could potentially expand the market available to Nigerian pharmaceutical companies.
However, exporting medicines involves regulatory requirements, logistics and market competition.
Companies will need to understand the regulations of destination countries.
They will also need reliable distribution arrangements.
The proposed policy extension could give manufacturers additional time to prepare for regional expansion.
The industry expo also focused on localisation and Africa's pharmaceutical and life-sciences sovereignty.
More than 200 exhibitors participated, bringing together manufacturers, regulators, investors, policymakers and other stakeholders.
Such events provide opportunities for businesses to identify suppliers, technologies and potential partnerships.
They can also expose Nigerian manufacturers to new production technologies.
The pharmaceutical manufacturing sector is changing rapidly.
Automation, advanced quality-control systems, biotechnology and new manufacturing techniques are becoming increasingly important.
Nigerian companies that want to compete regionally will need to keep pace with those developments.
The government's policy framework can support that process, but private companies will also need to invest.
Research and development will be particularly important.
A country that simply manufactures existing medicines may remain dependent on imported intellectual property and ingredients.
Developing domestic research capabilities can allow companies and institutions to create new formulations and technologies.
The government has encouraged manufacturers and researchers to invest in research and innovation.
That could create opportunities for collaboration between pharmaceutical companies, universities and research institutions.
The development of vaccines and biologics is one area where research capacity will be especially important.
Such products involve more complex manufacturing processes and quality requirements than many conventional medicines.
Nigeria's ambition to develop stronger pharmaceutical capacity therefore requires long-term investment.
The proposed extension to March 2029 would provide additional policy time, but the development of a competitive pharmaceutical industry is likely to require sustained investment beyond that period.
The government will also need to monitor the effectiveness of the incentives.
Policy incentives should ideally produce measurable improvements in production capacity, investment and medicine availability.
Manufacturers will need to demonstrate that the support translates into expanded operations.
Regulators will need to ensure that quality standards are maintained.
Consumers ultimately need medicines that are safe, effective and affordable.
These objectives need to operate together.
Increasing local production without maintaining quality would not achieve medicine security.
Similarly, producing high-quality medicines that remain unaffordable would limit their public-health impact.
The policy challenge is therefore broader than simply increasing factory output.
The pharmaceutical value chain must function efficiently from raw materials to finished medicines.
The proposed executive-order extension is intended to support that wider process.
It gives manufacturers more time to operate under a policy environment designed to encourage local production.
The Federal Government has said it wants to reduce Nigeria's dependence on imported medicines by 70 per cent.
Industry representatives have also called for a sustained policy framework that allows companies to deepen investment.
The proposed extension to March 2029 would provide a further two years after the current policy is scheduled to expire.
Whether the extension delivers the intended results will depend on implementation.
Manufacturers will need to invest.
Government agencies will need to coordinate.
Regulators will need to maintain standards.
Financial institutions will need to provide appropriate funding.
Infrastructure providers will need to support manufacturing.
Research institutions will need to contribute innovation.
The private sector will also need to identify commercially viable opportunities.
The development of a domestic pharmaceutical industry is therefore a shared economic project.
For businesses, the policy creates a framework within which investment decisions can be made.
For government, it provides an industrial-policy instrument.
For consumers, the ultimate objective is greater availability of safe and affordable medicines.
For workers, the expansion of manufacturing could create employment and skills-development opportunities.
For the wider economy, increased local production could reduce some import pressures and create opportunities for exports.
The proposal also comes as African countries seek greater control over pharmaceutical supply chains.
The COVID-19 pandemic highlighted the risks associated with relying heavily on international sources for critical medical products.
African governments and regional institutions have increasingly discussed the need to strengthen local manufacturing.
Nigeria, as one of Africa's largest economies and consumer markets, has the potential to play a significant role in that process.
A strong domestic industry could serve Nigeria while also supplying other African markets.
Achieving that objective will require manufacturers to meet international standards and maintain competitive production costs.
The government has indicated that it wants Nigeria to become a pharmaceutical manufacturing hub in West Africa.
The proposed extension of the executive order is one measure intended to support that ambition.
The next two years could therefore be important for manufacturers deciding whether to expand their facilities, invest in new technology or enter new areas of pharmaceutical production.
Companies will also be watching developments in energy, financing, trade policy and regulation.
A stable environment across these areas could improve the prospects for long-term investment.
The pharmaceutical industry will also need to monitor demand.
Nigeria's large population provides a substantial domestic market, but purchasing power varies significantly.
Affordability remains an important factor in medicine access.
Manufacturers therefore need to balance production costs with prices that consumers and healthcare providers can afford.
Local production can potentially reduce some costs associated with importing finished products, but domestic manufacturing also has its own expenses.
Raw materials, electricity, labour, equipment and compliance all contribute to the final cost.
Improving efficiency throughout the value chain will therefore be important.
The government's proposed extension does not automatically guarantee lower medicine prices.
Its purpose is to create a more supportive environment for domestic production.
The impact on prices will depend on production efficiency, competition, supply and other market factors.
For businesses, however, policy continuity can provide greater certainty.
That certainty can be particularly valuable when investments have long payback periods.
A pharmaceutical factory may require years of investment before reaching full production.
Companies need confidence that major policy changes will not unexpectedly increase their costs.
The proposed extension is therefore being viewed by industry stakeholders as a way of maintaining continuity.
The government has indicated that the extension would run for another two years.
Manufacturers are expected to continue engaging with government on the details of implementation.
The sector will also continue discussions around financing, infrastructure, regulatory harmonisation and access to regional markets.
The outcome of those discussions will influence the pace of development.
For now, the major business development is the Federal Government's plan to extend the pharmaceutical manufacturing executive order to March 2029.
The proposal responds to calls from manufacturers for continued policy support and comes as Nigeria seeks to expand local production of essential medicines.
The government says the objective is to strengthen medicine security, improve healthcare resilience and develop the pharmaceutical industry as part of Nigeria's wider economic development.
The industry wants the policy environment to remain predictable enough to support investment in factories, machinery, research and production capacity.
If the extension is implemented as indicated, manufacturers will have an additional two-year policy window in which to deepen those investments.
The success of the initiative will ultimately depend on what happens during that period.
More factories, higher production capacity, stronger quality systems, improved access to finance and greater regional exports would provide measurable signs of progress.
The development of local pharmaceutical manufacturing could also create opportunities across other sectors, including logistics, packaging, engineering, laboratory services and professional employment.
For Nigeria, the broader economic objective is to move from dependence on imported medicines toward a stronger domestic manufacturing base.
The proposed policy extension represents another step in that direction.
The government has indicated its intention to continue supporting local pharmaceutical production until 2029, while manufacturers and regulators are expected to work on the investments and reforms needed to make the sector more competitive.
As the March 2027 expiration date approaches, the focus will now shift toward the formal extension of the policy and the implementation of the measures required to expand Nigeria's pharmaceutical manufacturing capacity.