•Global ripple hits nation; consumers bear brunt
•API prices jump 28%, orders cancelled because of shipments’ delay — May & Baker CEO
As the conflict in the Middle East lingers, its impact is no longer confined to the region’s battlefields.
Across continents, economies are beginning to feel the strain.
In Nigeria, one sector quietly edging towards crisis is the pharmaceuticals industry, where industry players have warned that disruptions in global supply chains could soon translate into drug shortages, rising prices, and serious public health consequences.
Findings have shown that from the closure of key shipping corridors such as the Strait of Hormuz to rising global energy costs, the war is triggering shocks that are reverberating through industries worldwide.
For Nigeria, a country heavily dependent on imports for drug manufacturing, the implications are particularly severe.
A recent report by global and regional bodies, including the African Union and the African Development Bank, had warned that African economies could lose up to 0.2 percentage points of GDP growth in 2026 if the conflict persists beyond six months, largely due to disruptions in trade, energy, and critical supplies.
Fragile supply chains
The National Agency for Food and Drug Administration and Control, NAFDAC, has repeatedly warned that heavy reliance on imported medicines carries serious risks for public health, especially in the context of global supply disruptions. According to the Director General, Prof. Mojisola Adeyeye, the majority of Nigeria’s pharmaceutical products come from abroad, particularly from Southeast Asia, and this import dependency exposes the country to vulnerabilities when global trade routes are disrupted.
At the heart of Nigeria’s pharmaceutical vulnerability lies its dependence on imported Active Pharmaceutical Ingredients, APIs, the essential components used to produce medicines.
With most of these inputs sourced from countries like India and China, experts warned that any disruption in global logistics quickly reverberates locally.
In the view of the Managing Director/Chief Executive Officer of May & Baker Nigeria Plc, Mr. Patrick Ajah, the impact is already unfolding.
“It has already started affecting Nigeria,” he said.
“For manufacturers like us, most of our raw materials come from India, and India has been significantly impacted by the war.”
According to Ajah, the disruption was swift. “As early as the second week, some orders were cancelled, while for those who had stock, prices went up immediately. The price of paracetamol APIs increased by about 28 per cent,” he disclosed.
He also explained that beyond price increases, delays in shipment are compounding the situation.
“In some cases, the materials are not available at all. Even when they are, the time it takes to get them has increased significantly,” he added.
Global supply chain experts have echoed similar concerns, warning that delays in petrochemical inputs used to produce APIs are already disrupting medicine production, while transport bottlenecks continue to affect delivery timelines.
The Strait of Hormuz effect
Although Nigeria does not import drugs directly from the Middle East, he said the disruption of major global shipping routes is proving decisive.
Ajah explained that the Strait of Hormuz, a critical artery for global maritime trade, plays a central role.
“You don’t have to buy from that region to be affected. Most global shipments pass through that route. Once it is disrupted, everything is impacted,” he said.
The blockade and reduced traffic through the region have slowed sea freight movements, particularly from Asia, Nigeria’s primary source of pharmaceutical inputs.
Rising costs, shrinking access
He said the ripple effects extend beyond supply disruptions to rising costs. The war has driven up oil and gas prices globally, pushing transportation and production costs higher.
For manufacturers already grappling with energy challenges, the situation is worsening.
He said: “Diesel that was less than N1,100 is now about N1,800 per litre,” Ajah revealed.
“Power is a major constraint, and our energy costs have increased significantly.”
These rising costs, he warned, are unsustainable.
“If this continues, manufacturers will have no choice but to increase prices. You cannot keep absorbing these costs,” he said.
Globally, similar trends are emerging. Supply chain analysts note that even in advanced economies, medicine prices are rising due to increased freight costs and speculation-driven pricing amid fears of shortages.
Limited local capacity
Sunday Vanguard reports that while disruptions in global supply chains could, in theory, create opportunities for local production, Nigeria’s pharmaceutical sector faces structural limitations.
Ajah pointed out that local manufacturing is still heavily dependent on imported inputs.
“Over 80 per cent of our input materials are imported. Even local suppliers depend on imports, so when disruptions happen, the entire chain is affected,” he explained.
He explained that the dependence limits the sector’s ability to respond quickly to supply shocks.
Counterfeit risks and public health concerns
As shortages loom and prices rise, experts have also warned of a familiar danger, the proliferation of counterfeit and substandard medicines.
Historically, gaps in supply have been exploited by illicit operators, increasing the risk of fake drugs entering the market and endangering lives.
If access to genuine medicines becomes constrained, regulatory agencies may face increased pressure to safeguard the supply chain.
For stakeholders, the crisis underscores the urgent need for structural reforms, particularly in local manufacturing of pharmaceutical inputs.
Ajah advocated for long-term investment in API production, noting that the sector requires patient capital and strong government backing.
“These are not investments that will yield returns in two or three years. Government must provide support, especially funding, to encourage local production,” he said.
He pointed to examples from countries like India, where manufacturers benefit from low-interest or zero-interest financing.
“You cannot rely on commercial bank loans for this kind of investment. The cost of capital is too high,” he added.
In the short term, he called for faster port clearance processes to reduce delays in accessing imported materials, as well as the continuation of government incentives such as duty waivers on pharmaceutical imports.
For many in the industry, the current crisis echoes the disruptions experienced during the COVID-19 pandemic, when global supply chains collapsed and access to critical medical supplies became severely constrained.
He recalled that “During COVID, even if you had the money, you couldn’t get the products. We were stuck. That is why local production is important.”
Noting that while the duration of the Middle East conflict remains uncertain, its impact on Nigeria’s pharmaceutical sector is becoming increasingly clear.
For consumers, the consequences may soon be unavoidable.
“Ultimately, the burden will fall on the consumer,” Ajah said.
“When costs go up, prices go up. It is difficult, but companies have to survive.”
He warned that beyond rising prices lies an even greater risk, the possibility of scarcity.
“If the disruption continues, it may not just be about cost. Even if you have the money, the medicines may not be available,” he warned. Also speaking to Sunday Vanguard on the impact, particularly drug pricing, the National President of the Pharmaceutical Society of Nigeria, PSN, Pharm. Ayuba Tanko Ibrahim, confirmed a significant rise in the cost of medicines.
According to him, prices of some drugs, especially, imported products, have surged by as much as 30 per cent.
He, however, noted that locally manufactured medicines have, for now, maintained relative stability, stressing that Nigeria’s healthcare system encourages the use of generics, giving patients more affordable options.
”What that means is that patients can choose from a range of medicines that suit their financial capacity,” he said.
Ibrahim explained that the price increases are already affecting critical, life-saving medications, including antihypertensives, oral hypoglycaemic agents, antibiotics, and oncology drugs.
Despite concerns over rising costs, he clarified that the immediate challenge facing the pharmaceutical sector is less about counterfeiting and more about sustaining a reliable supply chain amid global disruptions.
Corroborating their views, the National Chairman of the Association of Community Pharmacists of Nigeria, ACPN, Pharm. Ambrose Eze, in a chat with Sunday Vanguard, said the cost of importing medicines has also risen by an average of 30 per cent.
He further revealed that shortages of some essential drugs are beginning to emerge as a direct consequence of the Middle East conflict.
On how the increased costs are being managed, Eze explained: “When you appraise our operational modalities, you will realise that every cost parameter affects the quality and availability of stock. Most business models encourage risk-sharing and the absorption of emergency cost elements. We cannot be exceptions.” He, however, reassured that the situation remains under control for now.
“We hope it does not escalate. Pharmacists remain critical at this point. As professionals, quality assurance and control will not be compromised,” he added.
Also, speaking to Sunday Vanguard,
Managing Director/Chief Executive Officer, Merit Healthcare Limited Pharm. Lolu Ojo said that although India and China, where most finished pharmaceutical products are sourced are not directly involved in the war, they are feeling its global effects.
According to him, rising energy costs are already pushing up production expenses, which manufacturers will inevitably pass on to consumers.
“Conservatively, we should expect a 15 to 20 per cent increase in drug prices anytime soon,” he said.
Ojo explained that the war is affecting manufacturers and importers in three major ways. First, lead times have increased as shipments are being rerouted around the Cape of Good Hope, adding about 10 to 14 days in some cases.
Secondly, freight and insurance costs have risen significantly due to war-risk cover, bunker surcharges, and emergency route charges. Thirdly, working capital pressure has intensified, given Nigeria’s heavy dependence on imported medicines and the continued weakness of the naira.
“In practical terms, this means higher landed costs, more cash tied up in inventory, and greater difficulty in planning prices and replenishment cycles,” he said.
He noted that businesses are increasingly unable to absorb these additional costs.
“Ultimately, the cost will be passed on. Margins have become too thin to sustain operations, and the ability to absorb extra costs is fading for most businesses,” he added.
Ojo, however, said the war has not yet forced major changes in sourcing decisions, stressing that quality and regulatory standards remain intact for now.
“However, a boomerang effect is expected if the war is prolonged,” he warned.
“The Iran war has not affected Nigerian pharmaceutical businesses through one single channel; it has hit us through freight, insurance, fuel, and foreign exchange at the same time. For now, the impact has been contained, but it will not be for long.”
The experts say that as the crisis unfolds, Nigeria faces a critical choice either to continue to depend on fragile global supply chains or invest decisively in building a resilient, self-sufficient pharmaceutical industry.
They maintained that the warning signs are clear and the clock is ticking.