Simeon Mpamugoh
Dr. Michael Oyebanjo Paul, is the Chairman/Managing Director of Mopson Pharmaceutical Limited, one of the earliest indigenous pharmaceutical industries in Nigeria. He began his career as a superintendent pharmacist with Vitabiotics Ltd, an Indian company based in Alausa, Ikeja, Lagos. After years of experience with the company in the early 80’s, he moved to Ojuelegba Surulere, Lagos, where he started out as a compounding chemist before setting up his own drug manufacturing company at a time many Nigerians preferred imported to locally made drugs. In this interview with him at his Osolo Way, Isolo office in Lagos, he takes us through the journey and why locally made drugs are more tropically suitable than the imported brand.
Excerpts:
Transition from a compounding chemist to manufacturer
Before I became a compounding chemist, I started working as a young man with Vitabiotics Ltd. based in Alausa, Ikeja. It was an Indian that owns the company ans after that I went fully on my own in the 80s. I was no longer under anybody and that made most people to think Mopson Pharmaceutical pioneered the indigenous drug manufacturing in Nigeria. There were other Nigerian pharmaceutical companies I met on the scene but what was special about Mopson was that we started making syrups. Before we started manufacturing our own drugs, I started from compounding, which is making drugs for doctors’ use alone. They tell me their formulae or I go get it for them from books of reference, make the drug and give to them for their patients. So, I was a compounding chemist at Ojuelegba. Doctors bring their prescriptions; I mix it and give them, just as they do in the general hospital. In fact, that was my job; to mix drugs for immediate use of doctors and patients. In medical terms, it is called extemporaneous dispensing. It is a situation whereby as a pharmacist, you get the doctors’ need and make the drugs immediately for their need and they give it to their patients. So, I wasn’t seeing the patients but the doctors. Mine was just to make drugs for them and they dispense them for their patients. I started that way and later got specialised formulation to produce one that can be packed and sold to the public. That was the transition. Part of my training in the university includes this, but some of them I got the experience from working with companies. The best experience I ever had was in the general hospital, followed by working in early manufacturing companies such as Vitabiotics. So, most of my early experience in manufacturing was from the company.
I was the company’s superintendent pharmacist in charge of production. So, I had access into their formulations. And that was what I was using and packing. From there, I made some mistakes and went into research to make my own products. The early events were that our Vitamin C syrups were not stable. Vitamin C is a very troublesome product. After six months, it is no longer active.
It would have been converted into something else. We went into experiments and research to produce a stable one that can last longer. By the time we went into the research, it was in conjunction with universities: University of Lagos (UNILAG) and University of Ibadan (UI). They were our early partners. At the end, we developed Vitamin C syrup that could last for 10 years. Our experiment initially showed that it will last for three years from earlier six months but the actual life keeping shows that it is still active after 10 years. The product is called Ascorbion C300. It has the highest potency syrup and highest shelf life in Africa. The product is more active than most of the imported syrups. We have an award for it and we are proud of it. We have developed other products such as Supermag antacid that doesn’t sediment. The taste is fine. We have other products we have extended non-sediment activity to, which is called thixotropy. This system has been extended to many of our products and our suspended products like our suspensions don’t sediment.
If we can produce quality drugs in Nigeria, why do we still import
The reason we still import is because government does not control importation of drugs. In fact, Nigeria is open to more importation and local industries are facing severe competition in terms of drugs coming into the country and they are not as qualitative as the locally made ones. The formulations for drugs made in Nigeria are tropicalised and suitable in African setting but many of the imported drugs people are buying are specifications of other countries, which are suitable for them. Their considerations and licenses are up for use in their own domain. When Nigerians import them, they should know that the quality is not the same with locally made drugs. We are more controlled and regulated than them. And we are proud that in Nigeria, we have very good products. Any imported syrup or tablet of Vitamin C cannot beat the locally made one. One thing that should be noted is that, all the raw materials we are bringing into the country, Nigeria doesn’t produce them. Apart from water, no raw material comes from Nigeria. They are either from Europe, America, China and India, even Philippine or some other countries where they have developed primary industry.
Is it an institutional challenge?
No, it is an industrial challenge. We don’t produce the raw materials. We also don’t produce the machinery for processing them. Nigeria doesn’t produce paper for the carton as well as the ink for printing. The only thing locally sourced is the printer that printed the carton. It becomes expensive to even print in Nigeria. But if India is printing packs, it’ll be cheaper because they produce their paper from grass. They don’t burn grass in India. They convert it into paper but Nigeria would ask you not to burn yet the grass is not used for anything productive. You cannot control what you don’t have. When you say, don’t burn grass; people will burn it because nobody needs it.
Nigeria would have been producing paper because we have forests. We have Oku-Iboku Pulp and Paper Mill in Akwa Ibom State but where is the paper? We also have another one at Iwopin in Ogun State. All these mills would have employed people and Nigeria would have been producing them and things would have been cheap. The effect of this is that if you produce anything in the country, you import the packaging. We don’t have enough glassware companies producing bottles in Nigeria and the one we have is not run fully by Nigerians. Foreigners run it. There used to be five of them. Four have relocated; one is still moribund, trying to come back. The only one around doesn’t satisfy local need. In fact, its products are more expensive than imported ones. So, a factory that waits for them cannot produce. If you wait for Nigerian printer, you cannot meet the demands for product; wait for Nigerian bottles, you cannot meet up. And all the contents of plastic are 100 per cent from abroad, so, it is not going to be cheaper.
Nigeria is the greatest source of its problems. Our past leaders and administrators made policies that killed local industries that today, Nigerians import clothes. But what do they use to make clothes? Cotton, wool, among others, which the country produces; why are they not harnessing it to make clothes? It is because of orientation. Nigerians would even import foods like rice, starch and if we don’t take time, the country would find itself importing maize.
Importance of manufacturing pre-qualified drugs to the country
It is an evil that cannot help Nigeria. We have Nigeria standard in British Pharmacopoeia (BPC) and America standard, all of them are there. Now, you go and take World Health Organisation (WHO) standard. In the WHO standard, do you see any product in the market labelled WHO? It is a standard for the customers of WHO. The organisation would tell you the National Agency for Food and Drug Administration and Control (NAFDAC) is not pre-qualified. It is an insult to the agency. Where do you see pharmacopoeia called WHO? They are only pre-qualifying people who will produce to their standard.
They will tell you your factory must look certain way and this is a procedure you must produce for them. If NAFDAC is going to certify any product coming to Nigeria, it has nothing to do with WHO. Anybody wanting to get WHO certification should go and register with them and produce for them.
WHO market is not for common market. There is no quality specialty in WHO products. Are you going to over-qualify a product that has passed NAFDAC procedure in terms of microbiology, chemistry and all the parameters of the agency? If one says he must be WHO certified, and the organisation says that NAFDAC is not even pre-qualified to inspect its product, what does that mean? It shows that in Nigeria, we sometimes act as if there are no educated people in the country. Are we saying that some of the professors in Nigeria cannot compete favourably or even better than those in WHO? Some of our professors have not even applied for any WHO job. They concern themselves with teaching and research. NAFDAC standard is good enough. The agency uses BPC, United States pharmacopoeia and may be, India pharmacopoeia.
India has a pharmacopoeia for its own country and Nigeria should also have a standard for production. It is in the hands of NAFDAC and the agency is capable. So, if there is anything the agency is not able to do, it can research into it by calling Nigerian professors and research fellows to do it not thinking we should follow WHO standard, which is not universal. It is only for people who want to trade with WHO. Those who have been going there and pre-qualifying, there is nothing to be proud about them other than wanting to be customers and contract manufacturers for WHO. To me, it is foolery and political. I know that those in WHO are mostly from India hence there are more WHO pre-qualified companies in India than Nigeria. And there are some WHO pre-qualified products that cannot sell in Nigerian market. What government should do is to make NAFDAC standard quality. And anybody bringing any drugs as donations to Nigeria, once it has passed NAFDAC standard, it is good enough and locally available. So, any country bringing in donations should buy locally made products.
Zero tariff on imported finished products
This is another evil that does no one any good. When you say zero tariffs from other countries, what happens is that other countries take their drugs to these countries and pay low duties to get it into those countries and then find their market in Nigeria. So, when they cross Nigerian borders, they don’t have to pay. We cannot compete with them. They should repeal the union and let every country consume what it has brought into its own country. If you talk about ECOWAS Common External Tariff (CET), Sierra Leon doesn’t have factories but it has standard. Ivory Coast and other countries like Liberia don’t have factories producing drugs. There are also no industries in Gambia. The only industrially viable country is Ghana. The East African countries are more obedient to French standard than West African countries. Industries in Ivory Coast and Togo are mainly needed to target Nigerian market, Benin Republic; those industries there are targeted at Nigeria and some of these countries targeting Nigeria have warehouses in Benin Republic and Togo where they dump their goods and later find their market in Nigeria. Some of them are from abroad and already carrying NAFDAC number. So, when they come in, it is zero tariffs. And when the local manufacturer is bringing in raw materials from India, he is made to pay between 20-25 per cent. So, why should they come in? They don’t pay anything and I’m paying the Customs tariff. The products come in and are very cheap. It is like signing death warrant. Nigeria should get out of it so that the local industries can survive. Do you know that the Federal Government had a factory in Yaba, which used to produce drips and infusion? Those days, the Federal Government hospitals were not buying any infusion, there were tablets and other medical accessories for use in the hospital, Nigerian Army had Nigerian Army Small Scale Drug Manufacturing Unit (NASDMU) and it is still there. What has happened to the one in Yaba? Where are those drips and Ferrous gluconate Yaba used to supply to general hospitals. Some states like Rivers started it, Ogun State had one at Ijebu Ode. Where are those industries? They closed down because of government’s policies. If private companies are still surviving, it is because of determination to survive: competition, raw materials, machinery and packaging are all coming from foreign countries except water. Even the water, you have to buy their machines and chemicals to treat it for you to be able to use it. It could be said by inference that the water is also imported and the people who sell these inputs are also making finished goods and allowed to come in to compete with the finished products of the local manufacturer.
Effect of forex market on drug manufacturing sector
The government, through its policy on forex, has unleashed hardship on local industries. Looking at it economically, it is a way of taking the capital of manufacturers away from them. When dollar used to sell at N150 and you want to buy $100, how much do you need? It is not only industries; it also affects the average Nigerian. When naira was N150 to a dollar and, a product in America or India is $100 and now it is N360, how much do you need? You need N36,000 instead of N15,000. So, what do you do? Instead of buying 100 pieces of products, you buy less. What has happened is that your capital has been depleted and you have been decapitated. You need a new capital. It means your prices would go up to be able to bring the same quantity you used to and industries’ productivity would drop. Everything would drop and the prices would go up. And the money is extracted from the consumer. The consumer becomes the loser at the end and that creates poverty.
When you increase the dollar and because Nigeria doesn’t produce these things, you need more, you buy less and sell it higher so that you can meet up. And you will be paying staff less. For example, when the dollar was N150 your salary was N20,000. Theoretically, now that it is N360, your salary should be something above N50,000. That is if minimum wage then was N20,000. The minimum wage now should be between N55,000 and N60,000. It is what should be paid to the labourer. But how much are graduates being paid now? Are they still being paid N60,000? Our people have been devalued and any government that does that is an invader government. And due to the situation, many industries can’t pay; that means it is worse. It doesn’t pay the industry and the nation. And if as a farmer in those days you were sending your goods abroad and selling them at N150 but now you are selling them abroad, you will sell them more to have the dollar. And what would happen? All the famers would send their goods abroad and there would be starvation in the country.
Fake drug challenge
It is because of the open market policy of past administrations. Importers would come to me, they sell raw materials, they go to Idumota they sell finished goods. Fake drugs cannot originate from Nigeria because of NAFDAC quality assurance and checking. The agency is monitored. Fake drugs are coming from other countries to Nigeria through our porous borders. What is a fake drug? It is the drug that is not registered by NAFDAC. No matter its efficiency, if it is not registered by NAFDAC, it is a fake drug. What that means is that what we call a fake drug might be a good drug. It is only because NAFDAC has not approved it. Why is it that the agency has not approved it? It will approve it, if it knows the manufacturer, manufacturing process and the factory, which must be inspected before it certifies it as a genuine plant. And what the factory produces must be safe for Nigerians. A fake drug, therefore, is the one purportedly produced by someone not registered by NAFDAC.
There are many types of faking; a product of a good company can be faked such that one would not know. For instance, fake Panadol can be labelled Pazzidol or Passidol. It would be labelled such that it would look like Panadol. This is called nomenclature faking. The faker has faked the name. When this is done, the faker wants it to carry the same colour, which is known as colour faking. Then comes the graphics so that it could look like original Panadol. So, if ‘e no bi panadol, “ce n’est pas, panadol.”
Free trade agreements
We need factories running to meet the Nigerian need, which means running at optimum capacity. Mopson Pharmaceutical started to meet the country’s need. Regrettably, we have imported products in the market. It is easy to close down industries to allow importation of products because it is cheaper to import than manufacture in Nigeria. For example, Acepromazine product; the original company that researched it is selling it N3,000 to consumers but another firm from China is selling it N500. So if I manufacture it in Nigeria, can I sell it at N500? It is not possible if I’m not able to make enough profit and my production cost is N500 locally, but it is the way the Chinese manufacturer is landing. One could even see good packaging of their products and other aesthetics.
The problem with importers is that they are not interested in the profit but in the dollar. They need it in their home countries. So, when they come to Nigeria, their products are very cheap. What do they do with dollar? They use it to expand their industries. If you are importing, you have a special grace from the government. In essence, it doesn’t pay us to be talking about free trade agreements. When you bring some of them into the country, their raw material sourcing and other inputs would be so much that they would invade the local market and one would have to go into the culture of higher turnover, low margin. And any African that does that now, i.e. producing something in large quantity and making little margin, will oppress his workers. It is happening in China. The lifestyle of an average American is higher than that of a Chinese and it is due to their mark up. Chinese equivalent in America lives in Putsch flat with all the trappings of standard flat. Nonetheless, when a product margin is low, the quality of life of workers would be so poor that perpetually, they would be working all their life until they are not meeting ends. And the next generation would be workers with low quality of life. So, low margin, high turnover keep people working with little returns. The best and ideal is high turnover with protected market for one’s internal condition with good margin.
Relocation of manufacturers to neighbouring African countries
It is at the point forex market somersaulted. The dollar went up and many people carried their money out. The business environment does not pay them and they needed new capital. Immediately, they changed their money to dollar to reinvest in other countries that have kept their money stable. Foreign investors in Nigeria don’t keep their money in dollars. At the end of every week, they change all their money to dollars and send it to their countries and bring more goods. They want their goods in Nigeria and their dollars abroad. What this means is that they’ll go and settle abroad, use the dollar to invest and bring the goods to Nigeria and smuggling and corruption would increase in many areas.
The solution for Nigeria is, if nothing else, lower the importation of many goods to Nigeria, lower or ban the importation of rice. It is so interesting, especially in Cross River State, that they mechanised farming, took their children to farm and they have mega farms. Nobody ever knew Nigeria could do that. The same thing happens in Zamfara and Kebbi states; they planted rice. Lagos State has joined as well as Jigawa and other corporate organisations. It pays them because they have ready market and the country saved billions of dollars as a result of the revolution in rice farming. Rice would have been N35,000 per bag because of the dollar rate if not for the intervention. After some time, may be, Nigeria would be exporting rice. Today, Benin Republic exports to Nigeria and they make money. Nigeria did everything so that Benin Republic can buy but as at the time Nigeria was enforcing it that Benin should not come in, the country has not produced enough rice. They should have allowed some period of recovery. If we are buying rice from Benin Republic, we don’t need dollar.
Encouraging local pharmaceutical factories to function optimally
We need to ban the importation of products made in Nigeria. Anything made in Nigeria could either be banned or the inflow reduced. If we didn’t ban rice, people would still be importing rice. Some people put it in the booth of their cars, others put it in the seat because it pays to import. If it doesn’t pay, we should have done what is called laissez-faire, let everything balance itself. When the country produces so much, nobody would tell anyone not to import rice again. Nigerians have rice farms abroad; in China and Thailand, because they need foreign exchange but now Nigerians are growing rice: individuals, government and corporate bodies, those farms would be sold off. A lot of them have made enough profit so they can sell them back to the country.
Expansion and creation of more jobs
The way to go about it is to ensure availability of products. My products are available and I still produce and market quality products at affordable prices. One of our cough mixtures, Neofyline, won award as the best African cough mixture. We also have Asmalyn Syrup Salbutamol, which was voted best asthma management drug in the 2012 African Products Award by Institute for Government Research and Leadership Technology. I’m able to achieve that but it can be improved upon if I have to contend with local competition alone and not imported products. Why should Nigeria bring in multivitamin product into the country? Why should Nigeria bring in cough mixture? Why should they bring in tonic? It is better if we have competition among local manufacturers. So, government should reduce importation; ban any product in syrups from coming into the country. Government should also assess the local capacity of companies in Nigeria to produce certain items like infusion. If Nigerians can produce that sufficiently, stop the importation, ban or reduce its importation. It can be put into quota and Nigerians would slowly be able to boost local production. What is more fundamental is for government to encourage industries producing primary products like antibiotics. We have intelligent Nigerians that can produce Ampicillin and many other products like paracetamol. If you know how much India rakes in in paracetamol, you will marvel. Where does paracetamol come from? Petrochemical. After the crude oil, petrol, etc., have been extracted, the remaining slug, which is sold at stipend, contains paracetamol and other chemicals: dye, grease etc., inside the left over. If Nigeria can invest in this most important residue, it is another secondary refinery to re-refine a refined product. It is not going to come from same machinery but an entirely different investment, which the country is yet to tap. From industrialised economy, people come to buy it from Nigeria in cents, re-refine them and send the byproduct to us in millions of dollars.