Prof Mojisola Adeyeye, DG, NAFDAC

By GODWIN DUNIA

Industry stakeholders last lauded the bold step of the National Agency for Food and Drugs Administration and Control (NAFDAC) to rescind its earlier decision to hike fees of its services.

In this part of the world it is usually difficult for government agencies to swallow their pride and back down on the policy decision they have taken which may not be in public interest.

That NAFDAC reversed its decision without resisting the cries and pressure from the public who are always at the receiving end when obnoxious official decisions are taken, has earned it admirable accolades. Business Hallmark had in its previous publication reported the outrage that greeted the agency’s arbitrary hike in fees for its services.

However, in a spontaneous response to the outrage against the hike, NAFDAC)‘s Governing Council moved last week to suspend the implementation of the new tariffs. The body explained that the action was taken due to the tension and to curb the yearnings of stakeholders in the pharmaceutical, food and allied industries.

NAFDAC’s Director, Public Affairs, Dr. AbubakarJimoh, explained that the decision was made following a marathon stakeholders’ forum meeting of the Governing Council, held recently in Lagos.

Jimoh said, “After a marathon stakeholders forum and meeting of the governing council, it was resolved that all NAFDAC stakeholders affected by the new tariff will henceforth revert to payment of the old tariff until further notice.

“The council has considered substantially the inputs of the stakeholders in arriving at a new tariff regime which will soon be released by the agency after doing all the needful including sensitizing the public before it becomes effective.

He also said, the suspension was a reflection of it’s commitment to the promotion of the growth of Micro, Small and Medium Enterprises (MSMEs) in the country.

“We need to promote local manufacture of regulated products as part of Federal Government concerted efforts to create jobs and increase foreign exchange earnings by our dear nation.

“Nigeria has the potential of producing pharmaceutical products for the domestic consumption and export to West African Countries”.

NAFDAC’s seemingly harsh decision had attract wider condemnation from stakeholders as it was alleged to have been taken unilaterally by the agency without consultation with stakeholders nor considered the dire consequences it portends to Small and Medium scale Enterprises (SMEs) and the resultant effects on the employment rate in the country.

Another issue raised by the decision of the agency is that, NAFDAC primarily was established to safeguard the health of the nation by ensuring the quality, safety, efficacy and wholesomeness of food, drugs, medical devices, cosmetics, chemicals, detergents and water in Nigeria. It was not set up as a money generating agency per se as Custom, FIRS and others.

So, the concern among businesses was how to reconcile the good work assigned to NAFDAC and its recent decision to hike its fees at this crucial period of the nation’s economy when everything seems to go against the business people.

Those that would borne the brunt of the fee hike appears to be the pharmaceutical industry because the need to develop and import new drugs which may require packaging and repackaging. They complained that this is already having adverse effect on prices which could endanger the people’s health as the prices of drugs skyrocket out of their reach.

In reaction to the hike, a group under the aegis of ‘Congress of Concerned Citizens’ in a full page advertorial in a national newspaper, last week, reacted to the new policy and called on the appropriate authority to call NAFDAC to order in the interest of our ailing economy and the poor Nigerians.

The group said, “Recently, NAFDAC posted on their website (to be effective from June 1, 2019), astronomical increases in fees to be paid by manufacturers and importers of medicines. For instant, registration fees for prescription medicines went up to as high as 300%. Stakeholders were not carried along, and to make matter worst, the increase of some of them were quoted in U.S. dollars. A clear contravention of the bye laws of the Central Bank of Nigeria”.

The group also alleged that NAFDAC has declared war on the ease of doing business that the office of the Vice President and his team had been working assiduously to make Nigeria a better place to do business for investors and make life better for an average Nigerian.

”These two policies of NAFDAC hit directly at the pockets of the poor and needy, who would now be forced to pay more for pure water, bread, malaria drugs, even drugs for headache, chemicals and other consumables. The same poor and needy people that President Buhari wants to protect.

“It is in bad taste at this time of rise in unemployment and inability of some states to pay the new minimum wage. The attendant strain on the pockets that this policy would create can also open the doors for the unscrupulous to engage in the importation or manufacture of unwholesome and contaminated food, chemicals, cosmetics, drugs and all other products regulated by NAFDAC”.

Presently, SMEs contributes not less than 48% of the entire GDP in Nigeria and with this increase in cost of NAFDAC services, a great number of small scale manufacturers in the SME sector will be affected.

Business Hallmark investigation revealed that NAFDAC has effected changes in fees for registration, laboratory analysis, change of company’s name and ‘package size extension’, among others. Registration fee for bakery has change from N31, 750 to N89, 750, indicating a 90 percent increase. While the cost of registration form has gone up from N250 to N2, 500, indicating a 100 percent increase.

Product registration fee, which was N73,500 is now N147,000, indicating another 100 percent increase. Also, change in pack design is now N84,000 as against N10,500 few weeks ago. Moreover, cost of change of product name has risen from N21,000 to N84,000.

Efforts by Business Hallmark to get officials of the agency to confirm the alleged hike was not successful, as none of the officials in Corporate Department of the agency was willing to oblige information as at press time. The head of corporate Affairs said that only the DG can comment on the issue.

But earlier, the Director General of NAFDAC, Mrs. MojisolaAdeyeye, had stated in a press statement reasons for the hike. She said the decision was made by the regulator’s governing council as a way of reviewing its traffic to generate more revenue.

Adeyeye said NAFDAC has to raise its own Internally Generated Revenue (IGR), which informed the need for increase to get more money from tariffs and the other administrative services.

Meanwhile, the decision has continued to elicit reactions from operators of SMEs in the country as they are groaning under the new fees. For instance, National President of Association of Small Business Owners of Nigeria (ASBON), Mr. Femi Egbesola, had described the action as untimely and unsupportive for small businesses.

He said, “If the hike is allowed to stay, it will impact SMEs negatively as many will be forced to close shop and lots of jobs will be lost. And the move would lead to price hike in the regulated products by NAFDAC and support an increased entry of fake and substandard products into the Nigerian market”.

He also called on the Federal Government to intervene in the issue by asking the regulator to reverse the fees.

Also, spokesman of FCT chapter of Association of Master Bakers and Caterers of Nigeria (AMBCN), MallamNura Musa, urged NAFDAC to review the high tariffs imposed on bakers in the territory. He stated this while addressing newsmen in Abuja over the hike by the agency and the possible adverse effect on their businesses.

Another baker, Alhaji Abdul Owolabi, in his reaction to the hike, told Business Hallmark, “The decision is very untimely. I was told by a fellow bakers; it is very unfair that the federal government agency would take such decision knowing well the implications and that it would affect essential commodities like bread, but he said the new policy cannot stand the test of time.

His words, “I am very optimistic that they would reverse the decision. It would affect us as small scale business operators and also employment, people are looking for jobs and government should encourage small scale business and not the other way round. No business is doing fine now; every where is tight, business is not moving. So, the decision would ground most businesses in the country”.

Also, a pharmacist, who preferred to mention only is first name, Chief Caleb, also confirmed to Business Hallmark the likely consequences of the decision.

“I am a pharmacist of over 35 years experience and an importer of medicines. This decision would create lot of problem that would affect the poor man. Be rest assured that there would be proliferation of fake drugs than we used to experienced in the country and NAFDAC may not be able to contain it.

“Even now, there are fake drugs that I did not import but they are found in my shops mostly in Lagos and another state where I have shops, which I won’t want to mention for personal reasons. But if you ask me how come, that is the hand work of criminals doing business with me in the country.

“When such are detected, I personally destroyed them because, apart from the fact that I won’t want my salesmen to sell such drugs, it is criminal and it can tarnish the long image of your hard earned business. It is the handiwork of those who are desperate to make money at the expense of others at all cost. And the moment there is a policy like this, they would counter it. I pity Nigerians. They should reverse it for this sake of the gullible poor”.

Managing Director of Paint factory in Ikotun, a suburb of Lagos also told Business Hallmark that, he just got information about the development two days ago from a business partner. And I think it is part of the agenda to be deliberated by next week during our bi-monthly meeting.

“The impression given to me was that there is likelihood of increase in the chemicals we used and that I should try to be careful. It is a pity that in the face of this harsh economy government agency still wants to make business environment more unfriendly to small business owners.

“As a private investor, the least salary earner in this factory takes home not less than N25,000.00 every month, what some governor cannot pay. We sold an average of 50 to 100 tins of paints everyday or well over that figures, if we have contract supply. I am a graduate of chemical engineering but forced my father to give me money to start this business three years ago. It is doing well and I have not less than 15-work-force.

“I think government policy is to encourage private investment and not creating bottlenecks. Even the last attempt to get a loan from a bank was very difficult because of one condition or the other. This government is anti-people. NAFDAC cannot take that decision alone; it must have been influenced by governmental pressure”.

However, the clarion call is to the Federal Government to call NAFDAC to order and let private business owners be and continue to manage to operate.

 

 

 

 

 

 

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