MOUNTAIN VIEW, Calif., June 10, 2015 /PRNewswire/ -- Based on its recent analysis of the Nigerian pharmaceutical market, Frost & Sullivan recognizes Fidson Healthcare PLC (Fidson) with the 2014 Nigerian Frost & Sullivan Award for Growth Excellence Leadership. Fidson's definitive vision and strong management stoked a growth rate of 26 percent in 2013, cementing its leadership in the Nigerian pharmaceutical market.
Fidson's aim to enhance the quality of lives of Nigerians by providing affordable, quality pharmaceuticals has helped it evolve from a distributor for multinationals to a distributor of its own brands by 1996. Immediately after entering the market, it focused on extensive brand and production capacity building. In 1998, it purchased a local plant to manufacture its own branded generics in 2008, and after solidifying itself in the Nigerian pharmaceutical market and demonstrating adherence to excellent quality products and a strong business model, it was listed on the Nigerian Stock Exchange (NSE).
"Investing heavily in its own local production capacity has proved a winning strategy for Fidson. In 2006, the company expanded its production facilities to manufacture liquid formulations in addition to the tablets, capsules, cream and gel, and dry powder already in production," said Frost & Sullivan Research Analyst Danielle de la Mare. "It currently operates two factories and has leading brands in antibiotics, diabetes, hypertension, and food supplements."
Furthermore, Fidson is building a Nigerian Dollar N7.5 billion biotech plant that will double its production capabilities by 2015 and thereby facilitate economies of scale. It will also enable Fidson to invert its manufacturing capacity and imports ratio from 40:60 to 60:40. Fidson could be one of only five shortlisted local manufacturing companies to achieve Good Manufacturing Practices (cGMP) compliance.
The Nigerian pharmaceutical market was estimated to be approximately US$1.19 billion in 2013, with year-on-year growth of 12 percent. Fidson's audited report for the same period shows revenue growth of 29 percent, from N7.2bn in 2012 to N9.2bn in 2013. Fidson grew its gross profit by 26 percent, from N4.1bn in 2012 to N5.1bn to 2013, while its operating profit increased by 60 percent and operating margin by 3 percent.
In 2007, Fidson became the first company in Nigeria to manufacture its own brand of anti-retrovirals called Virex Anti-retroviral. This drug was 100 percent formulated and manufactured in Nigeria, and it successfully reduced the cost of anti-retrovirals to the public by 75 percent, compared to the offerings of multinationals. As a result, the federal government purchased the product on an ongoing procurement basis for public hospitals and clinics, boosting Fidson's brand within the market.
"Meanwhile, Fidson has forayed into the IV infusions market, as it expects to increase its turnover by 20-25 percent in the next two to three years from this product pipeline," observed de la Mare. "It also plans to expand geographically into West Africa within a few years, after it further entrenches its presence in the Nigerian market, which constitutes approximately 65-70 percent of the West African market."
Significantly, Fidson prices its products at retail value and leverages its economies of scale to compete with cheaper imports. It has been able to bring down its factory overheads, passing on the savings to customers and simultaneously building its reputation as a company that is compliant with global standards such as ISO 9001.
"The most exciting companies to partner with, or invest in, are those that have an inspirational zeal for growth," said Frost & Sullivan Global President & Managing Partner Krishna Srinivasan. "Fidson Healthcare has demonstrated such a focus in the Nigerian pharmaceutical market by investing smartly, competing effectively, and carving out a unique, sustainable market position."
Fidson has shown keenness in leveraging technology, as is evident from its use of security technologies in product packaging to combat the spread of counterfeit drugs. Each Fidson product has a branded sticker on it with a number that the consumer can text toll free to verify the authenticity of the product.
Fidson estimates that it currently has a market share of approximately 9-10 percent, while its closest local competitors have nearly 8 percent. If this growth rate can be sustained or enhanced when the biotech plant becomes functional, the company could well become a fierce regional competitor in the future.
Each year, Frost & Sullivan presents this award to the company that has demonstrated excellence in growth and customer value. It recognizes the superiority of the product/service as well as the overall customer, purchase, ownership and service experience offered, which has resulted in the recipient company seeing above-market growth and increased share of wallet. The award lauds the growth, diversification and sustainability strategies of the company.
Frost & Sullivan's Best Practices Awards recognize companies in a variety of regional and global markets for outstanding achievement in areas such as leadership, technological innovation, customer service, and product development. Industry analysts compare market participants and measure performance through in-depth interviews, analysis, and extensive secondary research.
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