Nigerian Drug Makers Seek Two-Year Extension of Pharma Executive Order

LAGOS, NIGERIA — Seeking a pharma executive order extension to secure multi-year investments, Nigeria’s pharmaceutical manufacturers have formally asked the Federal Government to extend by two years the Presidential Executive Order granting tax and tariff relief, warning that the current policy window closes in March 2027. Speaking at the 8th Nigeria Pharmaceutical Manufacturers Expo in Lagos, Oluwatosin Jolayemi, Chairman of the Pharmaceutical Manufacturers Group of the Manufacturers Association of Nigeria (PMG-MAN), urged policymakers to maintain long-term consistency to protect recent sector gains.

“The gains recorded by the industry must be protected through policy consistency and a predictable investment environment,” Jolayemi stated.

While the order grants zero tariffs and tax exemptions on active pharmaceutical ingredients, excipients, and equipment across nearly 1,000 Harmonised System codes, the Federal Government has not yet publicly committed to an extension. Minister of State for Health and Social Welfare Dr. Iziaq Adekunle Salako reaffirmed national targets to expand domestic medicine production to 70 percent by 2030, but made no direct statement on the future of the tax waivers.

Why Pharma Executive Order Extension Matters for Local Production

Understanding why pharma executive order extension policies are critical for domestic drug manufacturers highlights key capital, operational, and fiscal benchmarks:

Policy & Industry Metric	Current Operational Baseline	Projected Impact of 2-Year Extension
Local Medicine Market Share	~30% supplied domestically	Supports target of 70% essential medicine production by 2030.
Benefiting Manufacturers	87 local pharmaceutical firms	Guarantees zero-tariff machinery and raw material imports.
Industry Facility Retrofits	37 plants updating standards	Provides policy certainty during multi-year facility commissioning.
Energy Overhead Costs	Over 40% of revenue spent on power	Mitigates production costs compared to China and India (<10%).

Capital Investment Timelines and Energy Challenges

The core argument for a pharma executive order extension stems from the lengthy capital cycle required to build, equip, and validate pharmaceutical manufacturing plants. Because a new production line can take several years before selling a single commercial product, lenders price risk based on guaranteed incentive timelines. A policy expiring before a facility opens offers little security for prospective investors.

In addition to tariff relief, drug makers face severe operational cost pressures:

• High Power Overhead: Nigerian manufacturers spend over 40 percent of revenue on electricity and back-up power, compared to under 10 percent for competitors in India and China.

• Financing Levers: The Federal Government has secured $2 billion in single-digit interest rate funding commitments, with 50 local firms currently in advanced financing negotiations.

Protecting Medicine Supply Chains and Patient Costs

Securing a pharma executive order extension directly impacts consumer medicine pricing and health security across Nigeria. Heavy reliance on imported pharmaceuticals leaves domestic markets exposed to foreign exchange fluctuations and international supply disruptions. Expanding local factory output lowers currency risks and reduces medicine shortages, provided local manufacturers can maintain competitive pricing and high regulatory standards.

Why It Matters: Without policy certainty beyond March 2027, long-term capital investment in local drug factories risks stalling, threatening Nigeria’s strategic goal of producing 70 percent of essential medicines domestically.

Source: The Guardian (Nigeria) Report, October 1, 2026