President Bola Ahmed Tinubu has signed an Executive Order to boost the manufacturing of healthcare products in Nigeria. The Order allows zero tariffs, excise duties, and value added tax (VAT) on selected machinery, equipment, and raw materials. Healthcare products include pharmaceuticals, diagnostics, needles and syringes, biologicals, and medical textiles. Other items are active pharmaceutical ingredients, excipients, necessary inputs raw for producing vital health products, long-lasting insecticidal nets, and rapid diagnostic kits. It is expected that the new policy will improve the ease of doing business for indigenous healthcare companies.
The Order also introduces models to motivate indigenous healthcare businesses such as framework contracts and volume guarantees. Different government agencies in Nigeria supervise the activities of the healthcare industry. Multiple regulations and levies can reduce the viability of a business. Leaders of regulatory bodies that interface with the healthcare sector such as the Minister of Health, Minister of Finance, and Minister of Industry, Trade, and Investment are required to prepare a Harmonized Implementation Framework, improve efficiency, and improve the duration of time to get regulatory approvals.
Other regulatory bodies including the Nigeria Customs Service (NCS), National Agency for Food and Drugs Administration and Control (NAFDAC), Standard Organisation of Nigeria (SON), and Federal Inland Revenue Service (FIRS) will carry out the order speedily as well as grant specific waivers and exemption for two (2) years.
The Executive Order meets the regulatory and policy goals of PVAC (Presidential Initiative for Unlocking the Healthcare Value Chain). PVAC which was introduced in October 2023 seeks to solve regulatory and policy issues that may limit growth in the healthcare sector. Healthcare reforms that boost investor’s confidence, creativity, and continuous development are top priority. It is expected that the price of locally produced medical products will be lower and more jobs will be created after the Executive Order comes into force.