Book probes origin of fake drugs in Africa
KRISTIN Peterson, a professor of Anthropology at the University of California, Irvine, United States (US), is the author of a new book on the dynamics of Nigeria’s pharmaceutical markets titled “Speculative Markets: Drug Circuits and Derivative Life in Nigeria.” Duke University Press in Durham and London first published the 238-page book with six chapters, in 2014. Peterson had her first degree in Biology and later worked briefly at a biotech firm in San Francisco in California before turning to social science because she wanted to study science and scientists themselves as an anthropologist. Peterson in this book connects multinational drug company policies, oil concerns, Nigerian political and economic transitions, and the circulation of pharmaceuticals in the Global South, Wall Street machinations, and the needs and aspirations of individual Nigerians. Studying the pharmaceutical market in Lagos, she places local market social norms and credit and pricing practices in the broader context of regional, transnational, and global financial capital. Peterson explains how a significant and formerly profitable African pharmaceutical market collapsed in the face of US monetary policies and neo-liberal economic reforms, and she illuminates the relation between that collapse and the American turn to speculative capital during the 1980s. In the process, she reveals the mutual constitution of financial speculation in the drug industry and the structural adjustment plans that the International Monetary Fund (IMF) imposed on African nations, which encouraged the proliferation of open drug markets such as Idumota, in Lagos, and fake medicines. To address the situation, Peterson in an exclusive interview with The Guardian recommended among other things the regulation of prices of medicines and the establishment of a central and regulated drug market in a controlled area. She, however, gave reasons why the government should, at least for now, not shut down open drug markets such as Idumota. CHUKWUMA MUANYA writes. Excerpts:
WHY are you in Nigeria? I have been coming to Nigeria since 2000. So I have been coming for 15 years on and off. I did my initial dissertation research here on Human Immuno-deficiency Virus (HIV)/Acquired Immune Deficiency Syndrome (AIDS) and AIDS activism and AIDS policies, looking at AIDS is getting implemented at the transition time from military to civilian rule.
During that period I was looking at people who were getting access to drugs, people living with HIV and then through that discovered the private drug market here in Nigeria.
So I became very curious so I spent several years studying it, mostly going into Idumota market and examining the system. We have always heard about the chaotic distribution system and my job was trying to understand what is that chaos.
Is it really chaotic or is there logic to it and I found out that there is logic to it all works. So what were your findings? Could you throw more light on that? First of all what I found was that in the 1970s maybe many people probably know, there was a very robust pharmaceutical market.
It was during the oil boom a number of multinational oil companies had come to Nigeria and they were either marketing or manufacturing and distributing here.
It was a very lucrative fund foreign market for these companies and I tell through the first two chapters of the book how this market actually comes into demise.
The thing that finished it off was the Structural Adjustment Programme (SAP) and so on the one hand you have co-operations who can no longer make the kind of money they were making because we now see why spread house-hold poverty that was coming so quickly and so people can no longer purchase drugs.
At the same time the drug industry worldwide was also experiencing immense profit decline. You know there was a recession in the US and many companies were impacted.
The way companies will try and survive their own recession was to get finance capital from Wall Street finance banks and in return for that Wall Street banks now said, ‘alright we give you money but now you have to start turning over short term gains,’ which the drug industries cant do because it takes 15 years to bring new drug into market.
So you cant just make these quick returns. So in order to do that it self-engaged in speculative finance practices that I did tell in the book. So you see these two things happening simultaneously, you see the rise of speculative capitals that drives drug companies to pull themselves out of Nigeria and at the same time you see SAP basically changed the economy in Nigeria.
The result is that an entire industry completely abandoned the Nigerian and West African market. Now we have this vacuum because 80 per cent of the drugs were coming from these companies so we have a huge drug shortage.
So what happens? The answer to this question is that I tried to understand how did markets like Idumota even come into being because it used to be a neighbourhood and now it one of the largest markets in the world.
And that market, at a time I was studying it, I don’t know about now, at least $1 million worth of drugs move through that market everyday.
So it is a massive volume. So how did that happen? During the Nigeria-Biafra civil war there was a local government area (LGA) called Orlu, which is in current day Imo State that was the headquarters for some pharmaceutical companies and Red Cross for humanitarian aid during the war.
The people from that town got training from these organisations and many of them after the war was over became patent medicine dealers. So they migrated out and many of them came to Lagos and they started out basically selling patent medicines.
As soon as this drug distribution system, as some as the multi-brand name drug companies left, and there was this huge vacuum, these traders now stepped in to take over the pharmaceutical distribution.
So that is the history of that particular market and from there it just grew. So that is sort of the background of what I found. So what message in your book conveying? I just gave a background on the first few chapters.
I also looked at the question of fake drugs, which is a big deal in Nigeria. One of the things I wanted to avoid during the book was talk about the way fake drug dealers are evil and nefarious and sort of weaken and cause medical havoc on the population.
We know that is true but I wanted to know more about that and I wanted to know what are the things that drive that besides people being supposedly evil.
So I spent time in Idumota market and was paying attention to how trading actually works. I interviewed a lot of traders and one of the things I found is that the volatility of the Nigerian market is one is the currency exchange and also the boom and burst of the market is a very important part of what drives the fake drug trade.
So while a looked at how that worked in Nigeria, at the same time I looked at the volatility of the global pharmaceutical market because the two are linked between Nigeria and the global distribution patterns.
At the global level, drug companies trying to meet Wall Street investment demands, what they do is that they offshore their production to areas where it cheaper to manufacture such as India and China.
Also, India and China is where Nigeria gets most of its drugs. So here are two countries where the offshoring and then the outsourcing of the production process is so prolific that there is no regulatory agency on this planet that can manage that.
For example there are 80,000 chemical companies in China and some them actually manufacture drugs or they made be drug companies that outsource to villages like smaller manufacturers.
So you never know who is doing the actual manufacturing and because of this proliferation and inability to actually regulate, it is then very easy for companies to do things like making the so-called real drugs during the day and the fake ones at night.
The same company can be making both licit and illicit products. Then the distribution chain, how do those drugs now come into Nigeria? I am talking about both licit and illicit drugs, they may go through several trading companies or they may leave Asia, come into Europe.
Europe has a very loose parallel importation laws. That means it allows traders to just use arbitrary strategies like buy low here, sell high there.
So it goes through five to six trading companies before it then moves into West Africa. These pricing patterns are very important as well as the buying and selling, and arbitrary charges and so on.
You can bring drug into the free trade zone where fake traders will actually re-label products and do things like that. So the way in which the global economy has actually been libralised like through free trade zones also encourages fake drugs.
So the very thing that is supposed to encourage commerce, actually also encourages the proliferation of fake drugs. I was interested in looking at systems not just what people’s motivations were.
It is like you are comparing what happens in US with that in Nigeria. Have you shared your findings with the federal ministry of health (FMoH), the National Agency for Food Drug Administration and Control (NAFDAC)? Have you launched the book? I haven’t actually launched the book here in Nigeria.
The reason is because I am working a publisher here in Nigeria to republish it and then when it gets republished we then look at coming back for a launch. I have sent some of my information to the relevant agencies but I haven’t sent them the book.
Some copies of the book are arriving and I hope to send it to them. In the long run what do you think is the solution to fake drugs and chaotic drug distribution in Nigeria based on your findings? I think one important solution is that the price of drugs needs to be regulated. Right now it is not regulated.
If you regulate the price of drugs at least someone coming to the market will know that a drug should only come within a certain price range, outside that you might detect that it is fake, that is a very big step.
The other thing I think is already happening is that NAFDAC and Pharmacy Council of Nigeria (PCN) have been pushing for the establishment of a central and regulated drug market in a controlled area where people will come and buy their drugs rather than in an open market like Idumota.
From your findings are you recommending the shutting down of open drug markets like Idumota? No! Right now one of the things I said in the book is that if you shut down the open drug markets, what you also do is you shut down the whole wholesale system because most of the wholesale sale system or much of it is running through these drug markets.
So for example Idumota is the place where manufacturers sell directly to traders and from there they sell to the rest of West Africa even Central Africa as far as Kinshasa.
So if you shut down these markets, some of those drugs lose these links. If you are concerned of fake drugs coming into the market, I think the gradual transition that appears to be happening right now is actually the best way to go.
When you say shut it down you have to consider everybody’s livelihood not just the traders but even the people who are selling drinks, phone credits who rely so much on the commerce.
You have to consider what happens to them as well. The FMoH has brought out some new drug importation and distribution laws, which local manufacturers are crying out against that it is not good for business.
What is your take on this considering the lack of basic infrastructure and unfriendly environment for local manufacturing? Absolutely they are right about that because their work is so capital intensive.
It much easier to just buy and sell and dump in the market. You know there are couple of companies in Nigeria that are doing the best they can to deal with the circumstances but in order to compete favourably with importers they need protection and support from the government.
I think Nigeria has the capacity to also supply not only Nigeria but also the rest of West African region. But those companies will actually need several things. One they will need steady supply of electricity.
They will need all the basic sort of state infrastructure available to them. I think they would also benefit from working directly with bench scientists in Nigeria like in the area of research.
For example the United States President’s Emergency Preparedness Fund for AIDS Relief (PEPFAR) programme is shutting down. So where are the drugs going to come from now.
So Nigeria has the capacity to actually manufacture the first line drugs but government needs to be able to work with them. But the companies need a break; they need to be able to produce.
Besides your findings on HIV/AIDS drugs and the drug distribution system in Nigeria, what is your take on Nigeria? I have been coming and going for 15 years.
I have a lot of admiration for the tenacity for people to survive in such an environment. It is actually very moving to see and it is also completely unnecessary because Nigeria has everything, all the expertise, it has everything that it needs to be the kind of country that people envisage it to be since independence.
Right now things are so bad, I have never seen such a disparity between the dollar and the naira. This is killing small businesses; this is making it very difficult for people to struggle.
So the volatility of the economy is a constant problem for folks. I have been an outsider who has observed this for years and I think it is both incredible and tragic at the same time.
The chaotic drug distribution system has inadvertently affected the health system in Nigeria. Did you find out anything regarding the country’s health system? Lets take what happened about Ebola as an example.
What is incredible about that is that first of all you had so much expertise on the ground and people who have had plenty of experience in Nigeria and scientists who have had plenty of experience with infectious diseases control and so were able to step in and just stop this thing in its track.
But at the same time of Ebola there was a cholera outbreak, and cholera is not a disease that arrive at the airport, it is a disease that is linked to water infrastructure.
I think that what needs to happen is that the federal, state and local health authorities need better funding. Bench scientists and universities need more funding. This is where to begin and all of you Nigerians can sort out all the wahalas that come with more funding.