Dr Lolu Ojo, Managing Director of Merit Healthcare Limited and a fellow of the Pharmaceutical Society of Nigeria (PSN) has explained why GlaxoSmithKline (GSK) stopped operations in Nigeria.
GSK UK Group, the parent company, had informed GlaxoSmithKline Consumer Nigeria Plc of its strategic intention to discontinue the commercialization of its prescription medicines and vaccines in Nigeria through GSK local operating companies and transition to a third-party direct distribution model for its pharmaceutical products.
Ojo, a former chairman of the Association of Industrial Pharmacists of Nigeria (NAIP) and the Nigerian Academy of Pharmacy (NAP) committee on drug and substance abuse, stated that before this announcement, GSK products were extremely scarce in the market, and the few that were available were extremely expensive, sometimes selling for six to seven times the normal price.
He stated that several issues contributed to GSK's decision, including the Nigerian environment, which is hostile to enterprises, whether multinational or domestic. “Everything is stacked against genuine businesses, and only those who can cut corners are moving on, possibly cheating on the system,” Ojo said.
He said: “It has been extremely difficult to repatriate their (GSK’s) fund or pay for supplies due to scarcity of and fluctuations in foreign exchange. Immediately following are the huge losses attributable to foreign exchange movements.
“The floatation of the naira recently could mean that $10 million (in naira equivalent) waiting to be transferred since January may only amount to $6 million if transferred now.
“Unfortunately, GSK, by its own standard and avowed commitment to ethical ways of doing things, cannot do things the ‘Nigerian way’. There’s also the burden of being part of a Nigerian Public Limited Company with boundaries on what they can do normally.
“They had already exited East Africa, particularly, Kenya, which is their biggest market in that region. They will probably find a way to come back with third-party involvement.
“The market in Nigeria deals with established brands, which is not in alignment with the global strategy. The global focus now is on new molecules which are more profitable.”
