How FG, BoI plan to raise capacities of Fidson, May & Baker
It was a factory tour embarked upon by Okechukwu Enalamah, Nigeria’s minister of industry, trade and investment. Day was Thursday, July 13, 2017. On Enalamah’s entourage was Olukayode Pitan, newly appointed managing director and chief executive officer of Bank of Industry (BoI).
For Pitan, it was a familiarisation tour to ascertain how firms supported by BoI were faring. But for Enalamah, it was more of a fact-check to match fictions coming out of the manufacturing sector with facts.
Also on the entourage was Joseph Ari, the director-general of Industrial Training Fund (ITF), who did not hide his desire to bridge the town-gown gap.
Fidson
The first port of call was Fidson Healthcare Plc’s expansive N9 billion ultra-modern manufacturing plant in Sango-Ota, Ogun State.
It is one of the biggest manufacturing facilities in West Africa and among the five shortlisted for World Health Organisation (WHO) certification in Nigeria.
The plant has six production lines – for tablets, capsules, liquids, cream and ointments, dry powder and intravenous fluids– to meet the needs of the Nigerian and West African markets.
The factory tour was conducted by Fidelis Akhagboso Ayebae, Fidson’s chief executive officer, who was in company of Okey Akpa, CEO of SKG Pharma and chairman of Pharmaceutical Manufacturers Group of the Manufacturers Association of Nigeria (PMG-MAN).
It was interesting to see that the humongous factory was supported by the BoI, which has similarly assisted other manufacturing concerns.
The team felt satisfied that such a large plant was set up by a drug manufacturing plant
May & Baker
From Fidson, the team moved to May &Baker, still in Ota. May & Baker is one of the four pharmaceuticals in Nigeria to get the WHO certification, which enables it to submit tenders for international supply bids.
Just recently, the Federal Executive Council recently approved a joint venture agreement with the drug maker for the manufacture of vaccines in the country from 2017 to 2021. Ever since then, May &Baker’s stock has been on the rise.
The drug maker has the capacity to produce 4.5 billion tablets and 37.5 million bottles of liquid per annum .
At the tour, Nnamdi Okafor, managing director of May &Baker, said getting the WHO certification cost the company billions to achieve.
Okafor said the drug maker struggled to maintain the facility after commissioning but commended the role played by BoI in ensuring that it stayed afloat.
“I must commend BoI which stood by us all through. At the time we were pursuing the WHO certification, we ran back to the BoI and we were obliged some funds. Last year, we were also invited by BoI and we were able to access some funds,” he said.
He commended the Federal Government’s partnership with the firm for the production of vaccines, but added that the company was facing challenges with energy, which had reduced its capacity from 50 percent to 32 percent in less than two years.
“Most of the power supplies are denominated in dollars. I spend about N500 million every year on power. There is some kind of monopoly in gas supply because here, there is only one company supplying gas. You go to them and they tell you the minimum they can supply. Even if you cannot use all of them, you still have to pay. For the first three to four years, I could not use up to 20 percent of the gas I had. At some point, I had N150 million worth of gas I can’t use,” he stated.
Responding, Okechukwu Enalamah said the government was interested in producing more goods locally that met global standards, saying that the present administration was serious with industrialisation.
“The most important thing we want to do is to build an enabling environment in terms of sift and hard infrastructure. We already have executive orders and we are clear-cut on how long it takes to get what you want. The only way we know is if the users of these products give us feedback,” the minister said.
He said industrial power was one of the priorities of the government
On his part, Olukayode Pitan said the bank is a problem-solving institution.
“If there are things you want us to do for you, tell us. You said you have 1,000 staff and can increase your capacity,” Pitan said.
“We have supported you and we will still support you. The problems you have listed are common to industries. There are very few businesses that can pay back 25 percent interest and still remain in business. That is why in BoI, government wants to reduce that. We want many more companies to have the WHO certifications so that we can meet standards everywhere and compete,” he stated.
Kimberly-Clark
Kimberly-Clark is Nigeria’s new investor who manufactures diapers. The company, established in 2013 in Nigeria, has invested about $55 million.
“If there is one thing that stands out, it resonates the confidence of shareholders to continue to invest in this market,” said Tayo Fagbamigbe, company’s senior legal counsel for sub-Saharan Africa.
Fagbamigbe said Kimberly-Clark would be grateful to the government if it could ensure stability in gas supply, deal with illegal importation of diapers and logistics challenges in export to West Africa as well as allow the firm to test some imported finished products locally before setting up a local plant for them.
In his response, Enalamah said Nigeria was no unique in any sense, stressing the need for the private sector to begin to engage the government.
ODINAKA ANUDU