I invested in quoted pharmaceutical companies in Nigeria recently. A few weeks back, I got the annual report of one of the quoted pharmaceutical companies I invested in and was highly disappointed in the management ability of pharmacists running these companies. The Pharmacists running these companies have been taking the cash of Nigerian pharmacists invested in their company and turning it into thrash?
Quoted pharmaceutical companies on the Nigerian stock exchange, run by pharmacists, have been major money losers for their investors. Quoted pharmaceutical companies from Nemeith PLC through May and Baker, Fidson and pharma Deko have all burnt money of investors faster than the furnace Nebucharnezzar threw Shedrach and co into.
I used to think that Glaxo smithkline was different and invested some money in their stock but from their recently released annual report and their current price on the Nigerian stock market, GSK has also lost more than 40% of the money I invested in it.
I have taken some time to try to understand what the pharmacist managers of these companies are doing wrong? Why is it that we cannot have one single quoted pharmaceutical company based on their financial results that would inspire young pharmacists to strive to build a company that can be quoted on the Nigerian stock exchange.
The first issue I see has to do with the training that pharmacy schools in Nigeria give to pharmacists. The Nigerian pharmacy school trains you to be a very good pharmacists but unfortunately, the business community is not interested in very good pharmacists. What the business community is interested in is people who can run profitable businesses. Unfortunately, the pharmacy schools in Nigeria are not interested in training their students to be good business people.
The second reason I see why quoted pharmaceutical companies are poor performer on the Nigerian stock exchange is that most of them a just importers who have no area of core competence. If quoted pharmaceutical companies are importing more than 70% of their products and have high over head, how do they hope to compete effectively with smaller companies with low over head and very very effective sales team?
The third reason is that the managers of these quoted pharmaceutical companies have not been challenged by their shareholders apparently becuase of share holder apathy in Nigeria. This is the only reason why quoted pharmaceutical companies like Juli plc, Nemeith Pharm. International plc will for years be posting massive loses and their shareholders do nothing about it. The moment we start having activist investors in these quoted pharmaceutical companies, then the managers will sit up.
I hope young pharmacists are not discouraged by these poor results that their senior colleagues are posting
CONTACT US ON +234 8023622171