It can be asserted that Nigeria's healthcare system has made progress on various fronts. Through a range of government initiatives, the Nigerian healthcare system has been enhanced to address the growing concerns in public health. The National Health Insurance Scheme (NHIS) serves as the health insurance for the majority of the population in Nigeria. The effectiveness of this insurance scheme is crucial to the overall healthcare system in the country.
Citizens benefit from the National Health Insurance Scheme in several ways, including:
Out-patient Care
Maternity Care: This insurance scheme provides coverage for up to four live maternal births.
Preventative Care: This encompasses immunization, family planning, and health education.
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In-patient Care: A citizen is entitled to access inpatient care in a standard ward for a maximum of 15 days each year.
Preventative Dental Care
These are some of the services that individuals enrolled in this scheme may receive from the government.
Another positive aspect of the Nigerian Healthcare System is its provision of free coverage for children under the age of five and for individuals with disabilities. This represents a significant achievement for the system. It is also important to note that the insurance scheme is relatively affordable, allowing for easier coverage of citizens.
It has been estimated that approximately 30,000 Nigerians spend $1 billion each year on medical tourism. Sixty percent of this expenditure is allocated to four primary areas of healthcare: cardiology, orthopedics, renal dialysis, and cancer treatment. Although Africa is home to less than 15 percent of the global population, it accounts for up to 25 percent of the diseases uncovered or assigned by Western scientists. As the most populous nation in Africa, Nigeria faces a high incidence of widespread communicable diseases, according to the World Health Organization.
The public health system in Nigeria is managed by three levels of government. The Federal government oversees the operations of Federal Medical Centers and University Teaching Hospitals. The State government is tasked with the management of general hospitals, while the local government handles dispensaries. In late 2014, the Federal Government enacted the National Health Act, which sanctioned the creation of a state-supported health insurance scheme, as approved by the National Council on Health. This initiative has allowed the private sector to assume a more significant role in the provision and financing of health services throughout the nation.
The healthcare landscape in Nigeria is extensive and intricate, encompassing primary, secondary, and tertiary healthcare services. The Nigerian Sovereign Investment Authority (NSIA) aims to promote private sector investment in healthcare by fostering public-private partnerships.
The Nigerian healthcare market is vast and varied. Its value chain includes manufacturers, health service providers, medical insurance companies, retailers, distributors, health financing organizations, and medical education institutions. While there is a pressing need for investment across all these sectors, funding has predominantly flowed into multispecialty hospitals, niche healthcare providers, standalone diagnostic facilities, and Health Maintenance Organizations (HMOs).
Due to the preference of most investors for the lucrative returns associated with specialty hospitals and diagnostic centers, primary healthcare in Nigeria has not attracted significant investment. However, investing in primary healthcare can yield substantial benefits for both providers and recipients, especially if it capitalizes on a sufficiently large population and a corresponding network of diagnostic resources and specialist contributions.
There exists a significant opportunity within the Nigerian healthcare system to modernize outdated healthcare technologies, as the lack of infrastructure results in minimal vested interests or high costs associated with the implementation of new technologies.A multitude of investment opportunities is available throughout the healthcare value chain in Nigeria. Investors who wish to capitalize on these prospects will find it advantageous to adopt a long-term perspective on the market while considering the unique dynamics of healthcare investment in developing countries.
In August 1987, the federal government initiated its primary healthcare plan with several key objectives:
Investors looking to leverage opportunities in primary healthcare provision can tailor their proposed initiatives to align with some of the aforementioned objectives to gain greater support from the federal government of Nigeria.
It is estimated that Nigerians allocate approximately $1 billion annually for medical tourism. Prominent destinations for medical tourists include India, Europe, the United States, and the Persian Gulf. Clearly, there exists a substantial market of Nigerians in search of high-quality medical care, equipped with the necessary purchasing power.
Despite the presence of over 130 pharmaceutical companies in Nigeria, only 9 are publicly traded on the stock exchange. Indigenous pharmaceutical companies can only satisfy about 45 percent of the total drug demand in Nigeria. This situation creates an opportunity for import substitution.
The healthcare sector in the nation is drawing the attention of foreign investors, enhancing the prospects of the healthcare industry, which many consider a burgeoning market. Additionally, there is potential for franchise agreements with certain global healthcare service providers, whereby the local company would serve as the exclusive manufacturer of some internationally recognized drugs and healthcare products.
With a population exceeding 180 million, there is a significant disparity between healthcare requirements and actual provisions, presenting vast opportunities for multinationals with substantial research capabilities and investment capital.
Moreover, the industry has experienced numerous significant changes in recent years, including legislation that enforces a mandatory health scheme for employees and an intensified campaign against counterfeit and substandard drugs.
Numerous international pharmaceutical and healthcare companies are presently functioning in Nigeria. Among them are:
Additionally, several other firms are exploring opportunities for acquisitions and partnerships with Nigerian enterprises as part of a global investment strategy focused on the healthcare sector. These investment prospects and collaborations encompass contract manufacturing and the establishment of new facilities by various healthcare service providers.
The federal government demonstrates a commitment to promoting private sector investment in healthcare delivery, particularly in the realm of primary healthcare.
The National Health Bill, enacted in 2014, establishes a framework for the regulation, development, and management of a national health system. It is specifically designed to enhance private sector involvement in the industry.
Initiatives are being implemented to counteract the outflow of funds, exceeding $1 billion annually, allocated to medical tourism. There exists a supply gap within the pharmaceutical sector, presenting a significant opportunity for investors.
Competitive Labor Costs and Abundant Human Capital
Nigeria boasts one of the most competitive labor costs globally, with an average monthly salary of US$250 (as reported by the National Bureau of Statistics). The country is home to a youthful and vibrant population aged between 15 and 35 numbering over 150 million individuals.
The government offers several other incentives within the healthcare sector, including: