(Business in Cameroon) - Cameroon's drug production unit, Africure Pharmaceuticals Cameroon (APC), has been facing difficulties since February 5, 2023, when one of its two production divisions burned down. Even the remaining unit is not operating at full capacity, as reported by Dr. Prosper Hiag, the Chairman of the Board (PCA). He estimates that CFA1 billion is needed to rehabilitate the damaged production block.
Before this incident occurred, the company had been working with its Indian partners for the past nine months to accelerate production. Teams at the Yassa production site are currently reinstalling new machines, with full plant operation expected to resume in December.
"In 2019, when production began, the company was operating at just 20% of its estimated annual capacity (one billion tablets), delivering an average of just 200 million tablets, capsules, and dry syrups a year. But to date, the number of product references has risen from 15 to 60," said Dr. Hiag, regretting that the fire incident had hindered this progress. He also acknowledged that unpaid government bills had contributed to the challenges, with the company claiming CFA400 million from the National Supply Center for Drugs and Essential Medical Consumables (Cename). Indeed, this public entity –APC’s largest customer for essential medicines supplied to hospitals, has faced difficulties settling its bills with the company since 2019, impacting relationships with suppliers.
Also, Cameroon continues to import over 90% of its annual medicine needs, with local producers capturing only about CFA8 billion of the estimated CFA125 billion market. "The local pharmaceutical industry has to rely on Cename (…) if we have no order, we cannot produce. We can't develop our local industry by authorizing a hundred or so drug exporters," said Dr. Hiag. For the former president of the Cameroon Order of Pharmacists, the State is not doing enough to support the local pharmaceutical industry, which is a sensitive and strategic sector.
As a reminder, on October 1, 2021, during a meeting with the Minister of Trade, Luc Magloire Mbarga Atanga, the President of the Association of Pharmaceutical Industries, Loe Gisèle Etame, highlighted that local production units operate at only about 20% of their capacity.
Like things were not bad enough, APC recently faced a tax reassessment of CFA1 billion “related to excise duty on non-returnable packaging, instituted in the 2018 finance law”. In Article 142-9, this law introduced a specific excise duty of CFA5 per unit of non-returnable packaging. "We thought that we had to pay CFA5 per box of medicines and we did so we paid regularly from 2019 to 2021. But to our great surprise, the tax authorities told us the tax is applied for each tablet and we have to pay it over three financial years,” Dr. Prosper Hiag explained, pointing out that this tax imposes a significant burden on the local pharmaceutical industry, since it represents 10% of the plant's sales.
Despite this reality, Hiag remains confident in the market's potential and calls on public authorities to better support the local pharmaceutical industry by reviewing tax provisions.