Pharmaceuticals now on zero Tarrif and Excise Duties
President Ahmed Bola Tinubu, has signed an Executive Order (EO) to transform Nigeria’s healthcare sector by increasing local production of healthcare products, reducing costs of healthcare equipment and consumables, and promoting local investments.
According to a statement by the Coordinating Minister of Health and Social Welfare, Prof Mohammed Ali Pate, this initiative, part of the Nigeria Health Sector Renewal Investment Initiative (NHSRII), addresses longstanding challenges and aims to improve health outcomes for Nigerians.
Key provisions of the Executive Order as highlighted by the minister include the following measures:
1. Zero Tariffs and Excise Duties: Exempting specified pharmaceutical machinery, equipment, goods, and accessories from tariffs and excise duties to reduce production costs and make healthcare products more affordable.
2. Special Waivers on Pharmaceutical Inputs: APIs, excipients, and other essential raw materials, including those for Long-lasting Insecticidal Nets (LLINs) and Rapid Diagnostic Kits, will benefit from zero tariffs, excise duties, and VAT, lowering the price of essential medicines and medical supplies.
3. Market Shaping: Establishing framework contracts and volume guarantees to stabilize the local manufacturing market.
4. Regulatory Harmonization and Expedited Approvals: Developing a Harmonized Implementation Framework to guide regulatory agencies in streamlining approval processes.
5. Implementation and Compliance: Agencies like the Nigeria Customs Service, NAFDAC, SON, and FIRS are mandated to ensure swift implementation. The waivers and exemptions are valid for two years from the effective date.
The minister noted that the EO is vital for the success of Ithe Nigeria Health Sector Renewal Investment Initiative (NHSRII) in addressing key issues such as:
• Reducing the High Cost of Medicines: By lowering tariffs and providing special waivers, adding that the EO aims to reduce the prohibitive costs of medicines and other pharmaceutical products, making healthcare more affordable for Nigerians.
• Boosting Local Industry: Encouraging local manufacturing will create jobs, stimulate economic growth, and reduce dependence on imports, ensuring a reliable supply of essential healthcare products.
• Enhancing Quality and Innovation: Regulatory harmonization and market shaping will drive innovation and quality improvement in the local healthcare industry.
• Strengthening Health Systems: By addressing underinvestment and regulatory challenges, the EO will strengthen Nigeria’s health system, improving service delivery and health outcomes, and enhancing resilience to future health crises.
The Director General of National Agency for Food and Drug Administration and Control (NAFDAC), Prof. Mojisola Adeyeye, in her reaction,commended the initiative, saying the President’s EO underscores his administration’s commitment to transforming Nigeria’s health sector.
“It aligns with the broader objectives of the NHSRII and the Presidential Initiative on Healthcare Value Chain (PVAC), approved in October 2023.
By addressing core challenges and providing a clear path for improvement, this EO sets the stage for a sustainable and high-quality healthcare syst
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em for all Nigerians”.