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The Federal Government has granted ₦24 billion in tax waivers to pharmaceutical manufacturers between 2025 and 2026 as part of efforts to expand domestic medicine production and reduce Nigeria’s dependence on imported healthcare products.

The Coordinating Minister of Health and Social Welfare, Professor Muhammad Ali Pate, disclosed the development during the 2026 Nigeria Health Sector Joint Annual Review in Abuja.

He explained that the incentives were introduced under the Presidential Executive Order on healthcare manufacturing signed in 2024 to encourage investments in pharmaceutical production and strengthen the country’s healthcare supply chain.

According to Pate, the tax incentives are part of a broader government strategy to develop local manufacturing capacity, improve access to essential medicines and reduce the vulnerability of Nigeria’s health sector to international supply disruptions.

The minister also disclosed that the government had secured 12 technology-transfer agreements and established a prospective investment pipeline exceeding $5 billion for the healthcare manufacturing industry.

He said the priority was to convert the investment commitments into operational businesses capable of producing safe, effective and affordable healthcare products.

Pate further revealed that 10 factories or manufacturing lines had been commissioned under the healthcare industrialisation programme, including six facilities brought into operation in 2026.

The facilities cover pharmaceutical production, rapid diagnostic tests, insecticide-treated nets and medical oxygen.

The development represents part of the Federal Government’s efforts to reposition healthcare manufacturing as an important component of Nigeria’s industrial and economic development.

Meanwhile, the Minister of State for Health and Social Welfare, Iziaq Salako, disclosed that locally manufactured medicines accounted for approximately 50 per cent of Nigeria’s pharmaceutical market in 2026, compared with 30 per cent in 2023.

He also reported an increase of approximately 10 per cent in the number of active local pharmaceutical companies.

The Presidential Executive Order provides fiscal relief on specified pharmaceutical machinery, equipment, active pharmaceutical ingredients and other raw materials required for manufacturing medicines.

The policy is intended to lower production costs, encourage manufacturers to expand operations and make locally produced medicines more competitive against imported alternatives.

Nigeria’s dependence on imported medicines and pharmaceutical raw materials has remained a major concern, particularly because exchange rate fluctuations and international supply chain disruptions can increase the cost of essential drugs.

Expanding local manufacturing could improve medicine availability, create employment opportunities, encourage technology transfer and strengthen the country’s capacity to respond to public health emergencies.

However, pharmaceutical manufacturers continue to face challenges involving access to affordable financing, reliable electricity, foreign exchange, production equipment and quality-controlled raw materials.

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The government has also indicated its ambition to increase domestic production of essential healthcare products significantly by 2030.

Achieving that target will require sustained investment, effective regulation and stronger support for local manufacturers.

The ₦24 billion tax relief therefore represents an important financial intervention, although its long-term impact will depend on whether manufacturers translate the incentives into increased production, improved affordability and wider access to quality medicines.

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Amarachi Ihesiulo

Ihesiulo Grace Amarachi is a Nigerian journalist, writer and media professional serving as the Editor-in-Chief of TheTraffic.NG, a digital news platform covering national and international affairs. Her editorial interests span politics, business, aviation, health, technology, entertainment, sports and social development. She is committed to credible journalism, insightful reporting and compelling storytelling that informs public discourse and keeps readers abreast of important developments in Nigeria, Africa and beyond.

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